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Research Tree provides access to ongoing research coverage, media content and regulatory news on Arkema. We currently have 13 research reports from 1 professional analysts.
Arkema reported +10% (v: +4%; p: +7%; FX: -4%; portfolio: +3%) higher sales (to €2,019m) and the gross profit margin improved from 22.3% to 23.4% in Q3. EBITDA clearly rose +17% to €331m and net profit attributable to shareholders jumped +48% to €142m, additionally boosted by a lower tax rate. 9M operating CF rose by +14% to €658m due to the strong organic performance and despite higher NWC outflows (€-135m after €-86m). Investing CF (€-19% to €-274m) was helped by lower changes in fixed assets payables and capex. Financing CF swung by €833m to €754m the higher inflow from net gross debt issuance (€926m after €26m). For 2017, management’s marginally adjusted FY guidance still expects to achieve EBITDA in the €1,310m to €1,350m range, and now sees EBITDA to come in at the upper end of the range.
Q2 sales were clearly up by +13% (v: +2%, p: +7%; FX: +1%: portfolio: +3%) to €2,198m and the gross profit margin slightly improved by 40bp to 24.0%. EBITDA rose +9% to €383m and net profit attributable to shareholders came in at €160m after €147m. Operating CF strongly improved from €73m to €242m based on the good operating performance and additionally fuelled by lower NWC outflow (€-50m after €-179m). Due to lower expenditures (€-145m after €-114m), investing CF moved from €-121m to €-106m. Financing CF swung from €-94m to €748m predominantly pushed by €899m net gross debt proceeds despite higher dividends (€-155m after €-143m). For 2017, management has marginally lifted FY guidance, now expecting to achieve between €1,310m and €1,350m (previously: €1.3bn) EBITDA.
Arkema announced its 2023 targets at its investors day. Management aims to generate a REBIT margin of 11.5-12.5% (2016: 9.7%; 2014: 7.5%) and EBITDA (based on recurring EBIT!)/free cash conversion of 35% (2016: 36%). The financial frame consists of ROCE to be at least at 10%, a net debt/EBITDA of <2x and an investment grade rating (2016: S&P: BBB; Moody’s: Baa2).
Arkema was up +14% (v: +5%; p: +5%; portfolio: +3%) to €2,152m and the gross profit margin improved from 22.1% to 23.0% in Q1. EBITDA increased +17% to €340m and net profit attributable to shareholders came in at €137m (€98m). Operating CF (+20% to €73m) was driven by the better operating performance despite the higher NWC outflow (€-179m after €-151m) due to higher receivables against the seasonality backdrop. Investing CF was broadly unchanged (€-97m after €-101m) slightly lifted by divestment proceeds. Financing CF doubled (€-20m after €-10m) seeing a decrease in short-term debt. For 2017, management had already confirmed its guidance of €1.3bn in EBITDA.
Arkema reported +5% (v: +6%; price: +1%; FX: -1%; portfolio: -1%) higher sales (to €1,852m) and the gross profit margin clearly improved from 18.0% to 19.3% in Q4. EBITDA strongly rose +26% to €246m and net profit attributable to shareholders jumped +76% to €86m. Operating CF came down from €380m to €246m, despite the higher operating performance, but NWC inflow declined from €205m to €97m and D/A was also lower. Investing CF moved from €-19m to €-327m burdened by significantly higher acquisition costs (€-337m after €2m) due to the closing of the Den Braven takeover. Financing CF was €-177m (€-57m), which suffered from higher net gross debt repayments (€-147m after €-25m). Management proposes a €0.15 higher dividend of €2.05 (€1.90) per share at the AGM on 23 May 2017. For 2017, management confirmed the achievement of the 2014 target of €1.3bn EBITDA. We expect the publication of the annual report in the coming weeks.
Arkema’s Q3 sales dropped 6% to €1,838m, but the gross profit margin improved from 20.2% to 22.3%. EBITDA went up +5% to €284m and net profit attributable to shareholders rocketed +57% to €96m. 9M operating CF strongly grew (+20% to €575m) due to the higher operating performance, despite a strong increase in NWC outflow (€-86m after €-19m). Lacking the huge cash outflow for the Bostik acquisition, investing CF abated from €-1,616m to €-337m, seeing capex far below D/A. Financing CF swung from €428m to €-79m, primarily due to the strong decline in net gross debt issuance (€26m after €478m). Management lifted FY guidance again, now expecting EBITDA growth in the 9-10% (7-9%) range based on the assumption that energy costs, raw material costs and FX will be in line with current levels. This does not include the announced acquisition of Den Braven. Closing is still expected in Q4 16.
Arkema’s Q2 sales (-7% to €1,952m) suffered from lower prices (-5%) stemming from lower raw material prices, adverse FX developments (-3%) and divestments (-2%), which may have been partly offset by higher volumes (+3%). EBITDA saw a strong increase (+38% to €351m) and net profit attributable to shareholders was up +11% to €147m. Operating CF remained broadly unchanged at €259m after six months of 2016. The better operating performance was mostly absorbed by higher NWC outflows (€-186m after €-67m). Lacking the cash outflow for the Bostik acquisition (~€1.3bn) in the previous year’s period, investing CF declined from €-1,531m to €-222m. Financing CF swung from €484m to €-104m as net gross debt proceeds melted away (nil after €486m). Management lifted the FY guidance and now expects EBITDA growth in the 7-9% range based on the assumption that energy costs and FX will be in line with their current levels. This does not include the announced acquisition of Den Braven for which the close is still expected in Q4 2106.
Arkema plans to acquire Den Braven, a leader in sealants for insulation and construction in Europe, for an EV of €485m. As the deal is subject to anti-trust approvals, closing of the deal is expected to take place in Q4 16.
Q1 sales were slightly up (1% to €1,893m) seeing one month of Bostik and some divestments (portfolio: +5%) and higher volumes (+3%), but lower raw material prices and the low point of the acrylic cycle ate up 6%. The gross profit margin improved from 18.25% to 22.1% and EBITDA strongly rose +32% to €291m. Net profit attributable to shareholders more than doubled (€98m after €42m). Operating CF (€61m after €34m) reflected the stronger operating performance, which was partly offset by higher NWC outflow (€-151m after €-110m). In Q1 15, investing CF was characterised by the Bostik payment and CF came back to a more normal level (€-101m after €-1,415m). The same is true for the financing CF (€-10m after €489m), which saw very minimal financing activities. Management confirmed its previously given guidance, expecting EBITDA to grow based on the assumption that energy costs and FX will be in line with current levels.
Bostik was a game-changing acquisition and the figures are dominated by this effect. In Q4, sales clearly improved +23% to €1,760m and the gross profit margin strongly improved from 15.5% to 18.0%. EBITDA went up +23% to €195m and net income attributable to shareholders nearly doubled (€49m after €27m). Operating CF more than doubled (€380m after €162m), driven by higher D/A and, additionally, propelled by a stronger NWC inflow (€205m after €61m), helped by lower inventories and receivables as well as higher payables. Investing CF came up from €-288m to €-19m as the previous year’s quarter was impacted by acquisition costs. Financing CF swung from €907m to €-57m. In the previous year’s quarter, Arkema issued a hybrid bond as a first building block to finance the Bostik acquisition. Management proposes a slightly higher dividend (€1.90 after €1.85 per share) at the next AGM on 7 June 2016. The payout ratio drops from 73.1% to 49.1%. For FY 2016, management is confident it can increase EBITDA, based on the assumption that energy costs and FX will be in line with current levels. The annual report should be available within the next few weeks.
Arkema will receive €73.6m from Klesch Group as compensation for the majority of costs incurred in the arbitration procedure.
Q3 figures remained dominated by the Bostik acquisition as sales strongly ramped up by +32% to €1,946m (volumes: -1%; prices: -4%; portfolio: +29%; FX: +7%) and the gross profit margin increased from 17.9% to 20.2%. EBITDA jumped +65% to €271m and net profit attributable to shareholders more than doubled (€61m after €24m). Operating CF (+31% to €224m) reflects the better operating performance and benefited from higher D/A. Investing CF (€-85m after €-111m) was helped by fixed assets payables (€79m after €-12m) despite higher capex (€-161m after €-107m). Financing CF swung from €128m to €-56m due to the lack of the previous year’s quarter inflow from short-term borrowings and the change of dividends to be paid (balance qoq: zero). In 2015, management expects EBITDA including Bostik in the range of €1,020-1,040m (previously: slightly above €1bn).
Q2 sales went up strongly by +39% (organic: -1%) to €2,106m and the gross profit margin improved from 18.1% to 20.3%. EBITDA ramped up by +35% to €254m and net income attributable to shareholders more than doubled (€133m after €50m). In H1, the operating CF benefited from the far higher operating performance coming in at €254m (€174m). Due to the Bostik acquisition, investing CF swelled from €-271m to €-1,531m, of which €-1,298m is attributable to the acquisition. Financing CF swung from €-107m to €484m due to the net gross debt issuance (€486m after €-25m). In 2015, management expects EBITDA including Bostik to be slightly above €1bn (previously: EBITDA to grow excluding the effect of the Bostik acquisition).
Research Tree provides access to ongoing research coverage, media content and regulatory news on Arkema. We currently have 13 research reports from 1 professional analysts.
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