Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on BOUYGUES SA. We currently have 7 research reports from 1 professional analysts.
Frequency of research reports
Research reports on
A stock returned to last spring's prices
23 Feb 17
The annual release has confirmed the trend seen in the first 9m. On one side, we have the rather stable performance of the construction businesses (80% of Bouygues’ turnover but only 55% of its EBITDA) with a global revenue decline in 2016 of 1% yoy and lfl (stable on construction itself and -4% yoy on Colas, but +11% for Bouygues Immobilier in a market boosted by historically low interest rates). And, on the other side, Bouygues Telecom (15% of Bouygues’ turnover but 32.5% of its EBITDA in 2016) is delivering quite impressive results given a French market still shared by four players: revenues were up by 6% yoy in Q4, as in the first 9m, but above all the EBITDA was up by 22% yoy for the whole year, with a margin up by 3ppts at 23% reflecting the savings made through the restructuring of the group. Net debt was at €1.9bn at end-December (corresponding to 0.7x the EBITDA), €695m lower than at the end of 2015. This decrease reflects the sharp growth in the group’s cash flow, up 21% yoy to €2.5bn at end-2016, the proceeds of the Alstom public share buy-back offer, asset disposals and very tight management of the working capital requirement by all the group’s business segments. As for the outlook for 2017, since the construction businesses have a high level order book at end 2016 and a solid competitive edge on their rivals, the current operating margin should continue to improve with a selective approach and focus on profitability rather than volumes. Management has also confirmed for Bouygues Telecom an EBITDA margin target of 25% for 2017.
A return to a 25% margin on telecoms within reach
18 Nov 16
The first 9m release has confirmed the trend in the last few quarters. On one side, we have the rather negative performance of the construction businesses (80% of Bouygues’ turnover but only 55-60% of its EBITDA) with revenue declines of 2% yoy on construction itself and 5% yoy on Colas, even if Bouygues Immobilier (property development) looks better in a market boosted by historically low interest rates. And, on the other side, Bouygues Telecom (15% of Bouygues’ turnover but probably again 35% of its EBITDA in 2016) is delivering quite impressive results given a French market still shared by four players: revenues were up by 6% yoy for the first 9m (and also in Q3) but above all the EBITDA was up by 23% yoy, with a margin up by 3.4 ppts at 23.1% reflecting the savings made through the restructuring of the group. Note the operating profit will be affected by non-current charges of around €270m, including the roll-out of network sharing with the SFR group and adaptation plans in the business segments, before taking into consideration non-current income related to the sale of towers by Bouygues Telecom. (On 11 July, Bouygues Telecom entered into a definitive agreement for the sale of towers to Cellnex. The agreement initially covers 230 towers for a total amount of €80m, although the number of towers could rise to 500. A gain of €56m on the sale of the first 230 towers was recognised as of 30 September 2016.) As for Bouygues Telecom, management has confirmed the return to long-term sales and earnings growth, and maintains an EBITDA margin target of 25% for 2017 with a plan to save at least €400m in 2016 versus end-2013.
A good Q1, reassuring for the future
13 May 16
Q1 revenues were down by 2% yoy while the EBITDA was up by 59%. But this operating performance has to be put in perspective given the fact that, as usual, Colas’ EBITDA due to seasonality was a negative €187m (vs -€173m a year ago) and therefore the 59% global increase represents only €26m, thus only 1% of the global annual EBITDA of the group. Commercial momentum continued in the construction businesses with an order book up 3% at end-December 2015 and almost flat at end-March 2015. Note some major contracts were won in France during Q1, including the Port of Calais extension, Tour Alto in La Défense and the renovation of the Louvre Post Office building in central Paris. As for the Telecom business, revenues were up by 6% yoy while the EBITDA increased by 23.7% yoy. A very good performance even if the growth recorded in terms of EBITDA has also to be put in perspective: the EBITDA in Q1 includes the impacts of IFRIC 21 which affect the timing of recognition of some taxes and represents only 15% of the full-year EBITDA. Nonetheless, the EBITDA margin is up by 2.3ppt!
So the big deal has collapsed
04 Apr 16
So the big deal, which was supposed to reduce from four to three the number of telcos in France and to lead to a more serene French market, collapsed on Friday evening… to the total surprise of nearly all investors on the stock market this morning. It seems that Martin Bouygues felt humiliated by the demands of the French minister of economy, Emmanuel Macron (especially on the future governance of Orange of which Bouygues would have become the second largest shareholder behind the French state). Martin Bouygues was indeed asking for too much from the beginning: €10bn for its telecom unit which is currently generating an annual EBITDA of only c.€800m (vs c.€1.3bn five years ago before the arrival of Free on the French mobile market)! Even if it was at this price that Patrick Drahi wanted to buy the unit a year ago, it was clear that in the case that Orange did the work for the others (Orange is the French leader and is indeed the least interested in the reduction from four to three of the number of telcos in France), it could not buy high Bouygues Telecom and sell low more than half of its assets to the others (Iliad and SFR). And Bouygues had to realise that two other players Xavier Niel and Patrick Drahi are used to being quite uncompromising in negotiations. Put in a nutshell, the deal has collapsed and the French telcos stocks dropped sharply this morning as a result.
Bouygues Telecom recovers before its possible merger with Orange
24 Feb 16
As expected Bouygues’s 2015 revenues were down by 2% yoy while the EBITDA was perfectly flat yoy thanks to stable profitability at the construction businesses and improved profitability at TF1 and Bouygues Telecom. The group has given in parallel a rather light outlook for 2016: “the group should continue to improve profitability in 2016.” Note, however, the group confirms its target of a return to long-term growth in sales and profits for Bouygues Telecom. Nonetheless, we have this time one number: Bouygues Telecom has an EBITDA margin target of 25% for 2017 (vs 19.7% in 2014 and 18.5% in 2015) with a plan to save at least €400m in 2016 versus end-2013. A quite impressive target but it is to make the bride more beautiful: the group is unlikely to achieve it as, at the same time, Bouygues is continuing the discussions announced on 5 January 2016 concerning a merger between Bouygues Telecom and Orange.
Bouygues Telecom's EBITDA is returning to sustainable growth
27 Aug 15
Bouygues's H1 revenues were down by 1% yoy while the EBITDA was up by 19%. The Q2 is a little bit better than the Q1 with flat sales yoy while revenues were down by 2% during Q1. As for the EBITDA, the good performance has to be put in perspective: Bouygues generates 70% of its EBITDA in H2 and the +19% recorded in H1 corresponds to less than 5% of the global annual EBITDA. But the good performance of Bouygues Telecom must be emphasised: while H1 revenues are down by only 1% yoy, the EBITDA is up by 7%, reflecting a real tight control of marketing and operating costs. The group has revised its outlook for Bouygues Telecom upwards and confirmed it for its construction businesses and TF1.
N+1 Singer - T. Clarke - Strong conclusion to FY16, record order book
28 Mar 17
After significant upgrades at the time of the full year update (PBT forecast +43% FY16; +14% FY17), today’s results are c.4% ahead of our expectations at the PBT level and show strong growth on the prior year (PBT +48%). All regions achieved positive growth in revenue. The outlook statement refers to a still growing order book (£350m at the end of February vs. £330m at the year end) and the strength of recent trading, with London & the South East and Scotland said to be particularly positive. The Group has reiterated its ambitions to improve margins, but we have not incorporated this into our forecasts at this stage. We have nudged up our FY’17 forecasts (PBT +5%) and introduced FY’18 forecasts that imply 2% PBT growth. Despite the well justified bounce in the share price, the shares still trade at a significant discount to the peer group (7.6x FY17 PE, 4% yield).
Panmure Morning Note 29-03-2017
29 Mar 17
We are cutting our recommendation to HOLD as we see little upside from current levels given the lack of positive surprises in today’s trading update. Multiples of 4.4x 2017 sales and 17x 2017 EBITDA imply an expectation of at least slightly exceeding expectations. We had assumed that acquisitions will provide the momentum until organic investments deliver. However, acquisitions are proving elusive and excess cash is diluting returns. Moreover, our forecast relies on at least one order in vehicle simulator market, which has yet to be announced. The management has shown that it can use the financial markets to raise equity but it now needs to show that it can deploy excess equity productively.
N+1 Singer - Severfield - Strong H2 drives upgrades; CEO temporarily steps down due to ill health
28 Mar 17
Severfield’s trading update highlights that trading during H2 was strong and the Group now expects results to be ahead of expectations. Cash flow performance has been similarly strong with net funds at the year end also expected to be ahead of expectations. The strong performance was driven by both a better than expected revenue performance and better than expected growth in the operating margin. We expect to increase our FY16 PBT forecasts by c.9% to around £19.5m. In addition, we are disappointed to see that Ian Lawson (CEO) has taken a temporary leave of absence due to physical ill health. John Dodds (non-executive Chairman) will step up to Executive Chairman on an interim basis and Alan Dunsmore (FD) has agreed to assume the role of CEO on a similar basis. This should ensure the continuity of the business whilst Ian is recovering. The outlook for Sevefield remains positive and the Group has reiterated its medium term target to double PBT from £13.2m in FY16 by FY20. We remain positive on Severfield (one of our best ideas for 2017) and continue to see clear potential for it to outperform its medium term targets.
28 Mar 17
ClearStar* (CLSU): Building a background for growth (CORP) | Sound Energy (SOU): TE-8 results (HOLD) | LiDCO* (LID): 2017 should be a transformative year (CORP) | Proteome Sciences* (PRM): FY 2016 in line. Moving towards breakeven (CORP) | Fulcrum (FCRM): Significant market potential, rising margins and a strong balance sheet (BUY) | Mortgage Advice Bureau (MAB1): Strong and growing intellectual property (BUY) | 7digital* (7DIG): Open offer result (CORP)