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Nothing special to say regarding the Q3 performance which was pretty much in line with our expectations, with a reassuring Spain but a modest growth slow down in Africa.
The key point is that having confirmed its outlook of EBITDA growth coupled with a capex decline, the group had been expected to increase its dividend. Unfortunately this will not be the case. Since Telcos are yield stocks and shareholders have been overlooked, this news is likely to weigh on the stock in the coming months.
Companies: Orange (ORA:EPA)Orange SA (ORA:PAR)
A decent set of Q2 results for Orange with stable revenues yoy in reported terms and EBITDA up by 4.5% yoy (adjusted for the co-financing).
With a forecast of a fairly significant increase in EBITDA less capex, the group should be able to steadily increase its dividend from 2023.
We stick to our Strong Buy on the stock. However, in the short term, the rotation toward quality growth stocks at the expense of telcos is likely to continue.
Companies: Orange SA (0OQV:LON)Orange SA (ORA:PAR)
The Q1 figures were in line with our expectations but they confirmed the outlook for 2022 of an EBITDA growth of 2.5/3% and a c.5% decrease in capex.
We still expect the group to enter a virtuous circle of vigorous FCF growth in the coming years allowing steady dividend growth. So we stick to our Strong Buy. Orange deserves to return to the best-in-class group in the telecom sector consistent with its 4.5% dividend yield.
Orange and MasMovil announced this morning the combination of their operations in Spain.
The combined entity would become a strong second player in Spain with revenues of €7.5bn (vs €12.5bn for Telefonica), EBITDAaL of €2.2bn. It is expected to generate €450m of synergies from the third year post closing onwards.
So, clearly a nice leaving gift for Orange from its future ex-CEO Stephane Richard.
We maintain our Buy on the stock.
Nothing special to say about the Q4 results which were in line with expectations. For the whole year, revenues were up by 0.8% yoy and lfl, while EBITDA was down by 0.5% yoy.
The key point is indeed the outlook for 2022 which is finally as we hoped. EBITDA should grow by 2.5-3%, while capex should decrease by 5%. The time has arrived to see a regular increase in the FCF in the coming years.
We stick to our Strong Buy.
A correct Q2 for Orange but the poor EBITDA outlook for 2021 has been confirmed and the dividend proposed for 2021 will be stable at €0.7. So nothing to wake up the stock.
The group is not expensive compared to its peers, and it offers an enticing c.7.5% dividend yield. Although not for this year, the group could surprise the market by a higher dividend increase than expected in the coming years. We stick to our Strong Buy.
The EBITDAaL was eventually down by 1% yoy but should have grown by 3.2% excluding the COVID-19 impact.
Despite this solid performance and the return to normal of its dividend, the stock is still languishing 20% below its pre-pandemic levels.
At first investors were also quite circumspect about Orange’s determination to keep its new towers company within the scope of the group. But later, Stephane Richard made it clear that Orange won’t go it alone in the towers space.
Companies: Orange SA
A decent Q3 for Orange as the impact of COVID-19 was more limited than in Q2 with only the sharp decline in roaming due to travel restrictions.
The key point of this release is, however, a proposed return to a €0.70 dividend for 2020 (with an interim dividend of €0.40 in December).
We maintain our Strong Buy on the stock with a 7.75% dividend yield for the coming 12 months.
Q2 revenues were down by only 0.4% yoy and the impact of COVID-19 was indeed very limited. This correct Q2 performance reflects a better than expected solid growth in France.
But, more importantly, given an expected stable EBITDA less capex in 2020, Orange will pay a dividend of €0.70 for 2020 (to be confirmed after Q3). So a return to normal which deserves a better price. We maintain our Strong Buy on the stock.
Orange presented yesterday its new strategic plan “Engage 2025”. The stock was, however, down by 4% yesterday while the group refused to commit to increasing its dividends over the period.
We maintain, however, our opinion at Buy on the stock with a significant upside.
Q2 revenues were up by 0.7% yoy and lfl, a satisfactory number and better than the zero growth recorded in Q1. The correct Q2 performance reflects this time a very solid resilience in France (+0.4%) and an acceleration in Africa & Middle East (+5.8%), while Spain was disappointing with revenues down by 1.6% due to a highly promotional market.
EBITDA has grown by 2% yoy and lfl and was slightly above expectations.
We maintain our Buy on the stock.
Q4 revenues grew organically by 1.4%, a satisfactory number in line with the growth recorded in H1 (+1.7%) after a weaker Q3 (+0.6% yoy). The 2.4% growth recorded in Spain is quite good as Orange had seen its impressive growth trend of 2017 slowing in the two previous quarters (+0.5% in Q3 vs. +1.8% in Q2, +4.3% in Q1 and +7.1% for the whole year 2017). In France, Q4 revenues were however only flat yoy and that is a little bit disappointing.
Q4 EBITDA has grown by 1.4% yoy but by 2.6% for the t
A good Q3 performance despite a slowdown in growth in Spain. Quarter after quarter, the group is confirming it has crossed an inflection point in terms of revenue and EBITDA growth.
Orange’s dividend has been raised to €0.65 in 2017 and looks to be €0.7 for 2018. We believe that the prospect of a regular rise in the dividend in the coming years, if it officially committed to this, would be likely to make Orange’s stock break the €15 level.
A good Q2 performance despite a less impressive growth in Spain. Quarter after quarter, the group is confirming it has crossed an inflection point in terms of revenue and EBITDA growth. Full-year EBITDA should grow by 3 to 4% yoy… and with capex which should decrease from 2019, the dividend could be better than expected next year.
Q1 revenues grew organically by 2% yoy, as in the previous quarter (+1.8% yoy): this is a good quarterly performance due partially to a recovery in the Africa & Middle East segment. All in all, it confirms the good trend recorded in the previous quarters. In France, revenues were up by 2.1% yoy (for the fourth time in a row), benefiting from the impact of digital media apps available since October, while the fixed broadband services have continued to grow steadily. The great story in Spain conti
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H1/23 interim results showed continuing strong trading for Calnex, with revenue of £12.7m, 38% ahead of H1/22 and PBT up 34% to £3.1m. Revenues increased across all its product lines driven by the sustained transition to 5G and continuing growth in cloud computing, particularly as hyperscale and enterprise companies drive greater efficiency and performance within data centre operations. Though component supply has been an issue throughout H1/23, Calnex has managed the supply chain well and shipp
Companies: Calnex Solutions Plc
Good Q3 update from MTI Wireless Edge Ltd (MWE.L). Each division (MTI Summit, Antenna and Mottech) demonstrated revenue growth and remained profitable. Overall, 9m revenue +8% to $34.8m and EBITDA +14% to $4.6m. Net cash remains a healthy $5.2m. Q4 has started well with two contract wins already announced for the Antenna division in India and Israel worth $1.2m in total. India represents a major opportunity for MTI’s 5G backhaul solution given the number of Eband towers that will be required. Th
Companies: MTI Wireless Edge Ltd
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What’s cooking in the IPO kitchen?**
AT85 Global Mid-Market Infrastructure Income plc, a UK investment trust targeting an innovative, adjacent-space strategy in some of the most sought-after sectors in infrastructure, is proposing to undertake an IPO on the Premium Segment of the Main Market. The Company has access to an initial portfolio of assets of £98.5m and a total pipeline (including the Initial Assets) of £539.8m. Targe
Companies: SAR CMX FIH ZIN ACRL UPR MWE NCCL
Focusrite’s revenue has been driven by acquisitions against a period of tough comparatives for the core brands. Current trading looks more encouraging for the majority of the brands, which is leading to gross margin improvements and a better outlook for EBITDA margin. We upgrade EBITDA forecasts for FY20e and FY21e by c 7%, but a higher tax rate in FY21 limits EPS upgrades in that year. For FY20e, an EV/EBITDA of 15.4x and a P/E of 24.9x are above long-term averages.
Companies: Focusrite PLC
Companies: D4T4 GHH FTC MEGP HVO HAYD ARB
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Altona Rare Earths, the AQSE listed mining exploration company focused on the evaluation, acquisition and development of Rare Earth Elements mining projects in Africa, intends to join the Main Market. Admission to trading of the Company's Ordinary Shares on the AQSE Growth Market will be cancelled simultaneously with Admission. It is also proposed that on Admission, the Company will change its EPIC from AQSE
Companies: TRX TENG CRCL TUNE DUKE BREE AMRQ
In line with the October trading update, Calnex has reported a c20% increase in revenue to £9.3m for H1/22 (H1/21: £7.7m) following substantial demand for telecoms testing equipment and strong levels of trading in H1/22. This strong trading has continued into H2/22. Investment in product development and operational scalability has been increased with the strong cash position enabling Calnex to accelerate investment and expand capacity in line with the growth in the order pipeline.
Calnex Solutions has announced that the strong levels of trading throughout H1/22 have continued and FY22E trading is in-line with expectations, subject to fulfilment of certain orders in March 2022. The order book into 2023 has increased substantially following a significant order from a large datacentre customer and FY23E trading is now expected to be materially ahead of current expectations. We have increased our FY23E revenue and PBT forecasts by 15.4% to £25.5m and 17% to £7.0m respectively
Calnex Solutions has announced the acquisition of iTrinegy, a provider of SDN network emulation and application testing technology headquartered in Stevenage and with a presence in Reno, Nevada. Initial consideration of £2.5m in cash will be paid with up to £1m additional consideration in shares depending on targets being met by FY24. iTrinegy's NE-ONE hardware and software platforms enable organisations, especially across the technology, financial, gaming and military/government sectors, to acc
FY21 results show another very strong year of trading for Calnex, with revenue of £22.0m, 8.9% ahead of our forecast £20.2m, with PBT up 64% to £6.0m. Demand for telecoms testing equipment has remained very strong. The order backlog has continued to grow and was at record levels entering FY23E. Calnex has managed component supply chain issues well, though component supply will remain an issue throughout FY23. Investment in product development and operational scalability has increased substantial
Companies: ARBB TON SBRY MTW TMG HFG WINK UJO FDM EPWN MWE