Back on its toes after previous year’s fall
FY19 was a good year for Vinci with top line growth of 10% to €48.1bn (with growth being observed along all the divisions and geographies of operations). NI went up by 9% to €3.3bn. Overall, the company fared better than the consensus and expects single digit growth in 2020. The company will pay a dividend of €3.05/share. We believe that we have already priced in the current and expected performance in our target price.
06 Feb 20
VINCI: Solid 2019 but less growth expected in 2020 | NEUTRAL | EUR97(-3%)
VINCI - NEUTRAL | EUR97(-3%) Solid 2019 but less growth expected in 2020 Solid revenues in 2019, in line with expectations EBIT roughly in line too (approx. 2% above consensus) Confidence in 2020 performance But overall growth likely to be more limited
05 Feb 20
VINCI: No more upside combined with a less favourable macro environment. | NEUTRAL vs. BUY | EUR97 vs. EUR92 (-3%)
VINCI - NEUTRAL vs. BUY | EUR97 vs. EUR92 (-3%) No more upside combined with a less favourable macro environment. Downgrade to Neutral following the strong share price performance Macro environment slightly less favourable with rates higher …inflation-interest rates spread not that wide anymore… While comparison basis will gradually get tougher.
22 Nov 19
Q3 19: good set of results
Vinci posted a good trading update. However, risks are mounting in real estate, in our opinion. Hopefully, a crash will not take place without a sharp increase in interest rates and on top of that Vinci Immobilier is only a small share of the group’s revenue contribution. Following this earnings release, we expect no change in our Add recommendation.
28 Oct 19
H1 19: strong performance but concessions are never beds of roses
The main driver over the following quarters will be the integration of Gatwick into the Airports portfolio and the potential impact of Brexit on the number of passengers. Management confirmed its rather vague guidance of higher revenue and net income for FY19. Following this earnings release, we expect to keep our Buy recommendation unchanged with a somewhat higher target price, namely a 5-10% increase.
13 Aug 19
Q1 19: good top-line figures bode well for FY19
Concessions’ revenue was up 7.9%, mainly thanks to Airports and contracting’s sales were up 10.3% thanks to strong organic growth in each business line. The key message in the 2019 outlook is that management expects further growth in its revenue and net income. Overall, we expect to increase our revenue assumption with a proportional increase in EBITDA, meaning that our target price will increase by 2-5%.
24 Apr 19
FY18: one-off “Yellow Vests”, guestimating the 30% discount impact on EBITDA
Vinci published a set of figures which were a bit disappointing, especially concerning toll roads traffic, mainly because of the “Yellow Vests” unrest. The big question is what will be the impact of the 30% discount for the 10 round-trip per month subscription. Note that French toll roads account for 55% of gross assets in our NAV, so this will be key to forecast next year’s EBITDA contribution from toll roads. Overall, we guestimate an impact of less than 5% on EBITDA.
06 Feb 19
Pre-FY18: eyeing further investments in Airports concessions!
Here, we discuss what the market will look like in the next FY18 earnings release and the main topic that could be dwelt upon during the conference call. Note that we haven’t had contact with management since we are in the quiet period.
05 Feb 19
Vinci Airports publishes strong traffic figures for Q4 18 and FY18
The Airports division accounts, after the integration of Gatwick Airport, for some 25% of gross assets in our NAV. There was 6.8% passenger traffic growth in FY18 on a lfl network base excluding Gatwick, as well as 7.2% growth in Q4, which is really good. We are currently reworking our model to integrate the Gatwick acquisition and the deal with the Portuguese government as well as this solid set of traffic figures. For now, we don’t expect a significant impact.
14 Jan 19
Vinci reinforces its position in airports
Vinci recently reinforced its position in airports thanks to the acquisition of a controlling stake in Gatwick and the decision to expand Lisbon’s airport capacity. Overall, this helps the company’s position as the favourite player in the bidding for ADP.
09 Jan 19
9m 18: solid performance, FY guidance confirmed
Management confirmed its full-year rather vague guidance, namely that Vinci expects to see growth in revenue, operating income and net income. Overall, we don’t expect a change in our recommendation and our adjustments to our model will have little impact on the overall valuation.
25 Oct 18
H1 18: outstanding results, Vinci slowing down activity in the UK
In the UK, there is a deliberate effort to reduce the order intake, in our opinion as a consequence of Brexit and Carillion bankruptcy, and in order to focus on margin quality. Concerning real estate and property development, management spoke of a most likely peak in activity in 2018 and expects to reach a plateau or even that it will begin trending downwards. Following this earnings result, we will revise our model. We don’t expect a change in recommendation.
01 Aug 18
Q1 18: good revenue growth driven by higher airport traffic and Energies
Business indicators in Q1 18, despite adverse weather conditions in Europe, confirmed the positive trends seen in 2017 and support the group’s forecasts of higher revenue and income for the FY. Following this earnings release, we will revise our model. We expect no change in our recommendation.
02 May 18
Upturn in Contracting margins supports earnings growth in Q4 17
Vinci released a robust set of FY figures which were slightly above street expectations and translating the continued momentum of Concessions in Q4 as well as improved Contracting margins. The dividend has been raised to €2.45, higher than we had anticipated (AV: €2.30), while the group gave a positive albeit unsurprising 2018 guidance.
08 Feb 18
Contracting upturn offsets weaker LV traffic in Q3 17
Vinci released a rather strong set of 9m figures, marked by a lower-than-anticipated traffic on French highways largely offset by a staggering 40% growth in airport revenue and continued recovery in the Contracting activities. Key highlights For the nine-month period: Revenue up 5.6%, to €29.2bn (+4.5% lfl) Concessions up 11%, to €5,318m (+6% lfl) Contracting up 3.8%, to €23,595m (+3.4% lfl) Order book up 9%, intake up 13% Net debt up 11.9% at €14.6bn 2017 guidance unchanged
25 Oct 17
Lower Construction margins spoil concession euphoria
Vinci release a mixed set of first half results, marked by disappointing EBITDA margins in Construction, although offset by a strong performance elsewhere and a 9.5% dividend increase. Key highlights Revenue up 5.1%, to €18.5bn EBIT up 9.5%, to €1.9bn Net profit up 11.9%, to €1,030m Interim dividend up 9.5%, to €0.69 Order book up 5%, to €30.7bn Net debt up €1.2bn to €15.5bn Outlook confirmed Management confirmed previous FY17 guidance of “growing revenue, EBIT and net income (before exceptional items)”. It sees contracting activities return to growth in France while activities outside France will mainly depend on the financial health of customers in the O&G industry. Revenue at Vinci Autoroutes will continue to grow, albeit at a lower rate than in 2016, while Airports are expected to grow by “more than 25%”.
28 Jul 17
Positive set of Q1 results
Vinci released a positive set of Q1 results, marked by the strong performance of Eurovia, solid traffic growth in airports and the confirmation of management’s 2017 guidance (“growth in revenue, operating income and net profit”). Key highlights Revenue reached €8.4bn, up +5.1% (+3.5% lfl). Concessions up 11% (+3.3%) and Contracting up 2.7% (+2.3%). France up 5% (+3.9%) and international +5.3% (+3%). Order intake up 9%, at €9.5bn, showing good momentum in all divisions. Order book up 3%, to €30.2bn. Net debt at €14.5bn, up from €13.1bn.
28 Apr 17
2016 results boosted by better than expected Construction and Airport activities
Vinci released full-year results ahead of market expectations, beating Q4 consensus by 2.8% on stronger Construction and Airport activities. Results For the full year, revenue came in ahead of expectations, at €38.1bn, representing a decrease of 1.2% compared to 2015 (consensus: €37.8bn, AV: €37.7bn). EBITDA came in 5.3% higher than last year, at €5.97bn, slightly above the €5.96bn consensus while EBIT was up 11.1%, at €4.17bn (€4.06bn consensus). The EBIT margin increased 250bp for the Concession business, at 46.9% and was up 30bp for Contracting activities, at 3.7%. Net profit was up 22.5%, at €2.51bn (vs €2.31bn consensus). In 2016, the concession business was up 8.5% (+6.5% lfl) at €6,298m, supported by a 14.2% lfl increase in Airports and a 4.9% increase in Toll roads. Contracting activities were down 3.4% (-3.8% lfl) translating a 0.2% increase at Vinci Energies, a 4% decrease at Eurovia and a 5.6% decline at Vinci Construction. During the fourth quarter, overall revenue was up 1% (+1.1% lfl), at €10,445m, beating the €10,156m consensus by 2.8% and translating a 12.1% increase in Concession revenue offset by a 1.4% decline in Contracting. Vinci Energies was down by 2.7% (-4.4% lfl), Eurovia was down 4.3% (-3.4% lfl) while Construction was up 1.1% (+3.6% lfl). The board proposed a €2.10 dividend, up 14.1% yoy, and 3.4% ahead of expectations. Outlook The company confirmed that 2017 should be the year when Contracting activities return to growth, with a slight upturn expected in France, while foreign activities are set to follow oil and commodity prices. The Concessions businesses are expected to continue growing albeit at much lower rates given the high base for comparison. For the group as a whole, Vinci expects consolidated revenue, EBIT and net income (before exceptional items) to rise.
08 Feb 17
Continued pressure on Contracting activities partly offset by a strong Concession business
Vinci released a mitigated set of Q3 results, broadly in line with the first half of the year. Guidance confirmed The company expects a slight decrease in revenue and an increase in operating income and net income. Revenue During the 9-month period, total group revenue reached €27.6bn, down 2% yoy on an actual basis and down 2.9% on a like-for-like basis. Concessions revenue was up 7.4% yoy (+6.1% lfl) driven by a strong increase in revenue at Airports (+22.7% reported, +12.9% lfl) and Motorways (+4.8%). Finally, Contracting revenue was down 4.1% (-5% lfl) due to the continuing underperformance of the Construction (-8% actual, -8.4 lfl) and Eurovia (-3.9%, -2.8%) businesses, partly offset by a slight increase at Vinci Energy (+1.3%, -1.6%). Orders Order intake reached €23.8bn, up 1% yoy while the order book reached €27.9bn, down 2% compared to the previous year (-1% excluding the SEA project). Management confirmed that several major projects including the Fehmarnbelt tunnel and the Bogota-Girardot project were not yet part of the group’s backlog. Additionally, the group confirmed that several tender processes related to the Grand Paris were currently being negotiated but refused to make any further comments, arguing it was still too early. Net debt down by c.€200m At 30 September, Vinci’s net debt stood at €13bn, down €200m compared to a year earlier. This decrease mostly reflects the sale of the parking business that was closed in Q3 and generated c.€230m cash. Note that this figure does not include the acquisition of Lamsac and Aéroport de Lyon, both expected to be closed before the year end.
26 Oct 16
Vinci is impressive cash machine
Vinci H1 2016 Sales dropped -1.5% Y-o-Y while Ebit jumped +11.7% at EUR 1’720 Mln and Ebit Margin climbed +120 Bps at 9.8%. Order Book rose +2% in H1 2016 to reach EUR 29.2 Bln (highest ever was EUR 33 Bln) while Order Intake was very strong at +11% in the first six months of 2016 In Motorways, road traffic was +3.3% in H1 2016 while airport traffic jumped +10.2%. Vinci owns today 36 airports worldwide (12 in France, 10 in Portugal, 3 in Cambodia, 2 in Japan and 1 in Chile + 2 newly acquired airports in Lyon and 6 in Dominican Republic this year) from 27 in Sept 2015. Vinci is controlling 55% of French motorways network with its 5 motorways Vinci 2016 Guidance expects +2.5% in motorways traffic and +7.5% in airports traffic. Company expects stable contracting with drop in construction (roads)
21 Sep 16
H1 16 bringing so much good news!
H1 16 revenues released and previous guidance reiterated. Consolidated revenue was €17.6bn, down by €260m (-1.5%) of which: - -3.3% lfl, with -1.2% due to negative forex and +2.3% due to positive consolidation scope; - concessions revenues €2.9bn (+€183m; +6.8%; +538% lfl); - contracting revenues €14.8bn (-€549m; -3.6%; -4.7% lfl); - outside France, revenue €7.3bn +0.2% and -1.4% lfl: the integration of recently-acquired companies was partly offset by the depreciation of several currencies, mainly sterling, against the euro; - proportion of total revenue generated outside France rose to 41.3% (40.6% in H1 15) with 47% in Contracting (vs 45% in H1 15). The order book at 30/06/2016 stood at €29.2bn, +2% over 12 months with +7% in France despite the near completion of the Tours-Bordeaux HSL project and -3% internationally. VINCI Immobilier continued to record growth in the number of apartment reservations in H1 16 (+24%). Revenue growth in the residential market in France offset the decline in the commercial property business, attributable to the timing of project phases. - Net income attributable profit was €920m, +12.4%. Interim dividend was €0.63, +10%.
29 Jul 16
Contracting recovery starts smoothly, concession traffic growth higher than expected
Q1 16 revenues released and previous guidance reiterated Consolidated revenue was €8,025m, down by €145m (-1.8%) of which: -3.3% lfl with -0.8% due to negative forex and +2.4% due to positive consolidation scope; - concessions revenues €1,306m (+€105m; +8.7%); - contracting revenues €6712m (-€249m; -3.6%; -5.4% lfl). Order intake was €8.7bn, up 12% yoy (+6%; rose 6% in France and +21% internationally) of which: - +10% in VINCI Energies - +12% at Eurovia - +14% at VINCI Construction The order book at 31/03/2016 was stable yoy (€29bn; +5.5% vs 31/12/2015) representing almost 11 months of average business activity.
29 Apr 16
FY 15 and FY 16 guidance in line with expectations
FY 15 results released and to be presented 05/02/16 at 11 am. FY 15 in line with our expectations. The most noticeable aspect is the improvement of EBIT margin and the stabilization of contracting activities in Q4 15. Consolidated revenue: €38.5bn (-€180m vs FY 14; our forecast was €38.7bn) of which +9% growth outside France (which represents almost 42% of total revenue). EBITDA €5664m +1.9%: EBIT margin improved by 60 bp to 9.8%: EBIT above our forecasts (€3758m vs. €3641m) due to lower D&A than expected. Reported attributable net profit €2046m not comparable to FY 14 due to asset sale. Recurrent attributable net profit €2102m (AV forecast €2085m). Proposed dividend: €1.84ps (above our €1.79 forecast).
05 Feb 16
Q3 15: Slight traffic acceleration and contracting order recovery.
Q3 15 consolidated revenue was €10.3bn (+2.8%; -1.5% lfl) with - Concessions revenue +3.9% thanks to strong performances at VINCI Autoroutes and VINCI Airports which saw a slight acceleration in traffic growth (vsQ3 14). - Contracting revenue +1.6% (after falling for five consecutive quarters) driven by acquisitions at VINCI Energies and general business growth outside France. 9M 15 consolidated came to €28.2bn: -0.9% lfl excluding VINCI Park (deconsolidated on 04/06/14) and -4.9% excluding +2% from positive forex movements and +2 % from acquisitions.
23 Oct 15