Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Eiffage. We currently have 14 research reports from 1 professional analysts.
Eiffage released a solid set of 9M 17 figures, marked by an equally strong performance of both the Contracting activities and Concessions. Key highlights For the nine-month period: Revenue up 7.1%, to €10,776m (+6% lfl) Contracting up 7.1%, to €8,683m (+5.7% lfl) Concessions up 7.2%, to €2,093m (+7.4% lfl) Order book up 8.7%, at €13bn Guidance maintained
Eiffage released a strong set of first half results, marked by robust contracting activities, whose growth outpaced that of Concessions for the first time since 2009. Key highlights Revenue up 7.6%, to €6,993m Operating profit up 7.4%, to €727m Net profit up 30.8%, to €174m Net debt down €367m, to €11,501m Guidance unchanged Order book up 7% Other developments The group announced the acquisition of Saipem’s Maritime construction business, a non-core asset part of its Offshore E&C division. The business is estimated to have generated around €100m worth of revenue in 2016 from works concentrated mainly in Kuwait, Congo and Panama. Completion is expected to occur in late 2017.
Eiffage released a solid set of Q1 results, marked by the confirmation of the previous guidance, stronger-than-expected Contracting and resilient Concessions despite lower traffic on unfavourable calendar effects. Key highlights Total group revenue up 7.6% (+6.2% lfl) Contracting up 8.4% (+6.7% lfl) Concessions up 4.2% Order book up 7.7 yoy, or +5.2% sequentially Unsurprisingly, management confirmed the previous guidance of a slight increase in sales, along with another increase in earnings.
Eiffage released a positive set of full-year results. Results Group revenue came in at €14bn up 0.7% yoy and 1.3% ahead of consensus. Operating profit was up 11.6%, at €1,597m while the EBIT margin was up 110bp, at 11.4%. Excluding an exceptional non-cash profit due to the future change in the French tax rate, net income was 5% above market expectations, at €416m (+33% yoy). By division, the Concession business performed strongly, revenue being up 4.6%, with Q4 slightly below the nine months growth figure. On the other hand, the contracting activities were broadly flat, implying a strong Q4 (+5%), driven by a continued recovery in the construction business in Europe and particularly in France. The Energy and Infrastructure businesses were down but started to rebound in Q4, particularly in the Energy market were revenue rose by 7.5%, compared to -7.1% during the nine months. The order book of the Contracting divisions increased to €12.0bn, up 5.1% yoy, equivalent to 12.6 months of activity. By division, it was down 1.8% for the construction activities while it was up 14.7% and 3.8% for the Infrastructure and Energy businesses, respectively. At 31 December 2016, Concessions’ net debt stood at €8,705m, down from €9,062m in 2015 while the group’s net debt stood at €11,213m down by €378m. The board proposed a dividend of €1.50, stable compared to 2015. Guidance Unsurprisingly, 2017 is expected to benefit from the 5.1% increase in order intake in 2016 and management sees a slight increase in sales along with another increase in earnings.
APRR, Eiffage’s main toll-road subsidiary, released its revenue and traffic update for the fourth quarter and full year 2016. For the full year: Excluding Construction, APRR’s consolidated revenue totalled €2,327.8m, an increase of 5.1% from €2,213.8m a year earlier. Toll revenues were up 5.2% at €2,257.7m, supported by a 3.6% increase in LV traffic and a +4.5% increase in HV traffic. Revenue from retail facilities, telecommunication and other were up 2.7%, at €70.1m. For the fourth quarter: Excluding Construction, APRR’s consolidated revenue totalled €545.9m, an increase of 4.8% from €521.1m a year earlier. Toll revenues were up 4.7% at €527.3m, supported by a 3.3% increase in LV traffic and a +3.4% increase in HV traffic. Revenue from retail facilities, telecommunication and other were up 7.8%.
Eiffage published a mitigated set of Q3 results. Results During the nine-month period, group revenue reached €10.1bn, down 0.8% yoy. The Contracting activities were down by 2.1% (-2.6% lfl), reflecting the relatively good performance of the Construction division, up 2.4% (+1.3% in France and +6.7% abroad), more than offset by the weaker results of the Infrastructure and Energy divisions, down 1.5% and 7.1%, respectively. Finally, the Concession activities generated €1,952m of revenue, up 4.9% yoy. During the third quarter, group revenue reached €3,565m, up 0.7% yoy. The Contracting activities were down by 0.2%. Construction was down 2.4%, Infrastructure was up 2.7% and Energy down 1.9%. Finally, concessions were up 4.3%, at €732m. The order book for the contracting activities reached €11.9bn, up 4.8% yoy (+7.5% excluding the BPL project), representing c.12.7 months of Contracting activity. Guidance The group confirmed its guidance of a slight decline in activity and improved results over 2016 as a whole. Other developments The company also confirmed that AREA, the APRR subsidiary, has signed an acquisition contract regarding the Bouygues Group’s entire 46.1% interest in ADELAC capital, the concessionaire for the A41 North motorway between Annecy and Geneva for €130m. At closing, AREA will sell this 46.1% to Eiffage and Macquarie. Eiffage’s stake will remain accounted for as an equity associate.
APRR released its revenue and traffic update for the 9-month and Q3 periods. For the 9-month period: Excluding Construction, APRR’s consolidated revenue totalled €1,781.9m, an increase of 5.3% from €1,692.7m a year earlier. Toll revenues were up 5.4% at €1,641.8m, supported by a 3.6% increase in LV traffic and a +4.9% increase in HV traffic. Revenue from retail facilities, telecommunication and other were up 1%. For the third quarter: Excluding Construction, APRR’s consolidated revenue totalled €665.4m, an increase of 4.6% from €635.9m a year earlier. Toll revenues were up 4.7% at €617.0m, supported by a 3.6% increase in LV traffic and a +2.7% increase in HV traffic. Revenue from retail facilities, telecommunication and other were up 2%.
- Consolidated revenues €6.5bn, -1.6% (-2% lfl); - EBIT +13.6% with operating margin improvement (+104bp to 10.4%) with the contribution of contracting; - Net profit attributable to holders of the parent +68% to €133m (despite higher restructuring costs mainly at Metallic Construction); - Net debt: -€0.4bn over 12 months and +€0.3bn since 01/01/2016; - Order book: €12.1bn, up 1.6% (+4.7% excluding BPL) since 01/01/2016 (12.8 months activities); - Increase in liquidity to €2.4bn at 30/06/2016 (vs €2.1bn at 30/06/2015). Eiffage reiterated its guidance for a FY 16 increase in net attributable profit. Post-closing event: 3 acquisitions of medium.
H1 16 traffic (number of kms travelled) +4.1% vs H1 15 with: Light vehicles +3.7% Heavy vehicles +6% Excluding Construction, Q2 16 APRR’s consolidated revenue: €575.7m + 4.6% (+€25m) Q2 16 traffic +1.8% with: Light vehicle +0.7% (unfavourable calendar effects) after +6.5% in Q1 15 (favourable weather effect) Heavy vehicles +8% (favourable calendar effects and traffic diversions linked to bad weather) after +3.9% in Q1 15
APRR released yesterday Q1 16 traffic figures after the market close. They are excellent (vs. Q1 15): + 6.5%, of which LV (light vehicles) +3.9% and HV (heavy vehicles) +3.9%. Traffic revenues: €506m, +6.8% (last tariff increase 01/04/2016), of which toll roads +7%. The annual contractual revision of tariffs agreed with the French State has translated from 01/02/2016 into an average increase of 1.23% and 1.27% respectively for light and heavy vehicles.
FY 15 performance is globally in line with expectations and slightly above our FY 15 forecasts (much above for the dividend) with the 2.8% decline of the order book as the only downside (+1.6% for Q4 15). A 25% increase in the dividend will be proposed, to €1.50 (AV forecast €1.25). FY 16 guidance: a small decline in consolidated revenues and a new increase in net profit (new contribution of lower D&A and lower financial expenses).
Eiffage has presented its reorganisation targets (only two head offices) and its management's tools based on digitalisation: - they respond to the most demanding requests in tenders (BIM); - they are the basis for cost control and efficiency; - they should enhance the efforts to improve margins. However, for 2015/16, the hefty costs implied by the restructuring should swallow the benefits. FY 15 guidance is unchanged. The newsflow should be rich in Q4 15 with the expected announcement in c.10 days of the results on the first bids for Grand Paris (Eiffage is the preferred bidder for at least one project, some PPPs and Eole). However, the expected revenues from these offers will not change the size of the group until at least 2017/18. These offers would be won in a price-pressured context but they have no lump sum risks. The recovery in civil works in France is still not here, the Real estate division is maintaining its size and the Energy division is being reorganised to align its EBIT margins on Vinci Energy’s. New progress is expected in financing costs.
- Consolidated revenues €6.6bn, +1.4% - EBIT +3.8% with operating margin improvement (+20bp to 9.0%) - Net profit attributable to holders of the parent +14.5% to €79m (despite higher restructuring costs mainly at Metallic Construction) - Net debt: down €0.4bn over 12 months - Order book: €11.9bn, up 1.1% since 1 January 2015 (12.2 months activities) - Sharp increase in liquidity to €2.1bn at 30/06/2015 (vs €1.5bn at 30/06/2014). Eiffage is guiding for a FY 15 increase in net attributable profit. Post-closing event: the 09/04/2015 protocol between the State and APRR & AREA and incorporating the motorway stimulus package amounting to €720m were published in the Journal Officiel on 23/08/2015.
APRR released after the 20/07/15 market close, H1 15 traffic figures. They are good (vs H1 14): +2.2%, of which LV (light vehicles) +2.3% and HV (heavy vehicles) +2%. Traffic revenues +2.7% (last tariff increase on 01/04/2014). Q1 15 traffic figures were +1.8%, of which LV (light vehicles) +1.8% and HV (heavy vehicles) +1.9% with traffic revenues +2.4% (last tariff increase on 01/04/2014).
Research Tree provides access to ongoing research coverage, media content and regulatory news on Eiffage. We currently have 14 research reports from 1 professional analysts.
Since our last missive, we have continued to experience volatility but there have been some signs recently of increasing stabilisation, although some nervousness clearly still persists. We have a Spring Statement from the Chancellor of Exchequer on 13 March where he will respond to the forecasts from the Office for Budget Responsibility. We have the prospect of a rise in interest rates in the short run, with further increases likely over the medium term with negative implications for ‘defensives’. In Share News & Views, we comment on Hargreaves Services, RWS Holdings, Staffline and Synectics*.
Companies: APC BMS CRPR ECSC EUSP FDM GETB PCF SNX SPRP TCN W7L
Bacanora Lithium—Readmission. No new money. Mkt cap £140m. Due 21 March. the new holding company for Bacanora Minerals Ltd | Stirling Industries—Acquisition vehicle focusing on industrials. Offer TBA. Due 5 March | GRC International Group— holding company for a group of companies providing a range of products and services to address the IT governance, risk management and compliance requirements of organisations. Offer TBC, expected 5 March 2018 | Core Industrial REIT—established to invest in Irish-based industrial properties, predominantly located in the Greater Dublin Area . Vendor placing and new funds to a total of €225m, Target gross proceeds €207m. expected 21 Feb | Polarean - Medical drug-device combination company operating in the high resolution medical imaging market. Offer TBC. Due 22 Feb | Block Energy—a NEX Listed UK based oil exploration and production company whose main country of operation is the Republic of Georgia, looks to join AIM end of February 2018. Offer TBC
Companies: RRL TMT CNC GHH EVRH IHC BILB EUSP VRS SBTX
• The Centrica Business division hammers the group’s results. • The company lost 5.2% of its clients (-1.4m) in the customer segment and -7.1% in the Business one (-100k). • Price cap should hurt 2019 margins (and earnings), but impact unknown. • Reassurance on the dividend side and OCF guidance (£2.1-2.3bn) is a positive.
e il futuro
Companies: ABBY BDEV BWY BKG BVS CRN CSP CRST GLE INL MCS PSN RDW SPR TW/ TEF WJG
In the February 2018 edition of the Hardman Monthly Newsletter, Nigel Hawkins addresses the issue of the UK's infrastructure expenditure, much of which is energy-related.
Companies: OPM ABZA AVO AGY APH ARBB AVCT BUR CMH CLIG COS DNL EVG GTLY GDR INL MCL MUR NSF OBT OXB PPH NIPT PHP RE/ REDX SCLP SCE SIXH TRX TON VAL
Vitec FY2017 results were slightly better than expectations on a continuing basis helped by new product launches, business mix and new acquisitions. The outlook statement points to confidence in further growth in 2018. We raise 2018E EPS by 10% to 83p (new consensus 82p), introduce 2019E EPS of 88.6p and maintain a buy rating.
Companies: Vitec Group
This quarter we use finnCap’s Slide Rule to provide both top-down and bottom-up analysis of the UK’s Technology and Telecoms sectors. Our findings are very reassuring: the Tech sector scores the best (across all sectors) when considering Growth and Quality – Taptica*, Frontier Developments* and dotDigital* in particular stand out on these metrics. Given these attractive characteristics and growth prospects, the Tech sector is unsurprisingly one of the most expensive – currently trading at 17.2x FY1 EV/EBIT and 23.8x FY1 P/E, versus 15.0x and 18.5x respectively for the wider market. Despite valuations appearing high, we believe there are value opportunities. For example, Proactis* features in finnCap’s QVGM+ portfolio (ranked 17/462) – the company offers attractive organic and inorganic growth, with earnings forecast to grow by 26% CAGR over the next two years, but despite this, only trades on 15x FY1 earnings and offers 8% FCF yield in FY2.
Companies: 7DIG ALT AMO ARTA BOTB BLTG CTP CITY D4T4 DTC DOTD ELCO ESG FDEV GBG IDEA IDOX IMTK IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET PHD QTX QXT RCN 932 SSY SEE SIM SPE SRT STR TAP TAX TEP TPOP TRAK UNG VIP ZOO CYAN ONEV
Driver’s FY17 results confirm the significant turnaround of the Group over the past 12 months. Revenue from continuing operations increased by 15% to £60.2m. Compared to last year’s loss making position (£0.4m LBT), Driver has reported underlying PBT of £2.5m, slightly ahead of our forecast (£2.4m). Cash generation has been a priority under the new management team, translating into negligible net debt at the year end (£0.2m and falling), compared to £9.9m (and rising) at the last year end. Driver is delivering on all the priorities set out at the time of the equity raise in February and begins the new year on very strong footing.
Companies: Driver Group
A look back at our 2017 ideas In aggregate our analyst picks outperformed the FTSE All Share last year by 9% and the cumulative performance of our portfolio over 6 years would have given a total return of 300% (almost double the return on the FTSE All Share). In addition, many of our top-down themes played out very well such as our focus on secular growth in Tech, Life Sciences, Healthcare and Financials, an increase in M&A, our cautious stance on the Consumer and especially our bet on continued strength in the Industrials last year and solid growth in the global economy. What does 2018 have in store? We continue to play ongoing secular growth themes in Tech, Life Sciences, Healthcare and Financials. In addition, we tap into domestic areas of cyclical strength such as regional construction and house building, plus self-help initiatives and potential market share gains. We maintain a favourable view of Industrials given the global economic backdrop but think this could moderate during the year. Other changes of nuance include the potential for a better H2 in the Consumer sectors, which remain under pressure for now, and a better outlook in Media from a mini-quadrennial year in 2018.
Companies: AMO AVG CBP CVSG DNLM EKF FENR IOM SAA GLE RLM SFR PGIT RLM SFR SOG VRP
Following the nomination of preferred bidder status in November, Avon has announced that an agreement has been reached with the UK Ministry of Defence (MOD) for the General Service Respirator contract. The contract builds order visibility on both sides of the Atlantic while demonstrating the new strategy in action.
Companies: Avon Rubber
Having delivered FY2017 results in line with expectations, Synectics plans to increase its investment in R&D by c.£0.5m in FY2018 to maintain its technological competitive advantage. We have adjusted our PBT forecasts to reflect this and that we now expect lower sales in Systems. The £3.8m of net cash at end November 2017 supports both the additional investment and a continuation of the progressive dividend policy in our view. With further profit recovery merely deferred we retain our DCF-derived 315p TP and Buy rating.
The developer of advanced security and surveillance has been awarded £1.5 million in contracts from the UK Ministry of Defence for the provision of communications equipment and services in the UK.
Companies: Petards Group
Organic revenue growth of 3%, improving net margins and incremental uplift from acquisitions provided for 15% earnings growth in FY17. We are confident the Group can maintain double digit earnings trends as industrial and internet retail clients outperform within this market and new business wins build revenues alongside M&A activity. Placing FY18 earnings on a peer group average multiple results in a one year price target of 99p. However, this does not factor the upside potential as management deliver acquisitions in line with strategic ambition of £300m revenues and £20m profit. Applying a FY1 sector multiple on delivery of 2020 reported PBT of £20m generates an indicative valuation of 155p, 83% upside on the current share price.
Companies: Macfarlane Group
BAE Systems reported mixed FY result figures with slightly increasing sales thanks to all divisions except for UK Platform & Services. The EBITA margin also slightly increased to 10.4%. However, the operating profit has been strongly impacted by the impairment of some intangible assets, leading profit for the year to decrease by almost 6%. The dividend is almost flat yoy as is the order backlog.
Companies: BAE Systems
The AIM Healthcare index has shown positive returns in all but three out of the past 11 years (2007, 2008 and 2011), growing at a CAGR of 7.6% over the period. This compares with a CAGR of -0.3% for the broader FT AIM All Share, +0.6% for the AIM 100 and +3.5% for its more senior FT All Share Health index. Sector growth and relative performance to the AIM All Share index has accelerated over the past five years; the sector having risen 19.19% CAGR since 1 Jan 2012. This compares with 6.8% growth in the AIM All Share and 6.1% in the FT All Share. This outperformance can be attributed to the increasing success amongst the Healthcare constituents which have progressed their business plans to a point where substantial value has been/is being created and where many companies have successfully scaled their businesses to sustain future growth. We highlight four companies that have different business models but exemplify the opportunities that are increasingly becoming evident within the sector.
Companies: ABZA AKR AGY APH AGL AVCT BVXP COG CTH IHC LID MTFB ODX OPTI NIPT PRM SDI STX SNG TSTL