Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Eiffage. We currently have 12 research reports from 1 professional analysts.
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 12 research reports from 1 professional analysts.
CyanConnode* (CYAN): Leader of the narrowband (CORP) | Ideagen* (IDEA): Consistent strength in delivery (CORP) | K3 Capital* (K3C): Director changes (CORP) | Lighthouse Group* (LGT): Trading update (CORP) | Somero Enterprises* (SOM): Strong June trading shows a pick-up in US market activity and affirms FY forecasts (CORP) | Castleton Technology* (CTP): Solid prelims (CORP) | Cello (CLL): Strengthening the offer in Health (BUY) | dotDigital* (DOTD): Yet again – positive trading update (CORP) | Allergy Therapeutics* (AGY): FY trading update drives 7% upgrade (BUY)
Companies: CYAN IDEA K3C LGT SOM CTP CLL DOTD AGY
Carador Income Fund (CIFU LN) CLO new issuance and reset activity continues | eg solutions (EGS LN) Strong H1 drives full year upgrade | Howden Joinery Group (HWDN LN) Successful NPD/pricing see pick up in recent LFLs, but risks growing | IQE (IQE LN) Photonics ramp up begins in earnest | Nichols (NICL LN) Strong interims and an accretive deal
Companies: IQE CIFU HWDN NICL EGS
We update this table which we first published in early January and highlight the continued progress of the biggest AIM companies so far this year and activity in general. The latest AIM Statistics show that there are 963 companies currently, with 28 new issues year to date raising £441m. What’s more, this momentum has been maintained since June. This demonstrates that despite, the uncertainty surrounding the UK economy, generally investors continue to be active in the AIM market. In Share News & Views we comment on Cohort, ECSC*, Porvair, Quarto*, SQS* and Xafinity.
Companies: BMS CRPR ECSC EUSP FDM PCF PPIX QRT SNX SPRP SQS TCN W7L
Since its inception in 2010, the Panmure Gordon Conviction List has outperformed the market, returning 284% against a Small Companies index that would have returned 221% over the same period.
Companies: ALD AVON CTH GKN HVN HCM INF NOG OTB POLY SNR SQS STJ
Nasstar* (NASA): Trading update (CORP) | Solid State* (SOLI): Initiation of coverage: Intention to double revenues in five years (CORP) | Mortice* (MORT): Further strong growth (CORP) | Petra Diamonds (PDL): Trading and guidance update (BUY) | The Mission Marketing Group* (TMMG): Positive trading update (CORP) | Connect (CNCT): In line but with a different mix (BUY) | Quixant* (QXT): Strong H1 performance underpins FY forecasts (CORP)
Companies: NASA SOLI MORT PDL TMMG CNCT QXT
Solid State continues to make progress towards management’s goal of doubling revenues over the next five years. It delivered pre-exceptional profit growth from continuing businesses of 6% during FY17. The record order book combined with investment during FY17 in both the Manufacturing and Distribution divisions shows management is driving organic growth to complement its successful acquisition programme.
Companies: Solid State
No change to forecasts following H117 update; our forecast equates to earnings growth of 23% in FY17. We believe a PE valuation around 10x remains inconsistent with current trading, geographical alignment and delivery of the strategy to acquire niche growth businesses such as Rishworth and ConSol. We anticipate an ongoing narrowing of the discount to its peer group as superior growth rates compensate for size/liquidity and cash generation drives a rapidly improved balance sheet. A rating of at least 13x is a realistic short term expectation providing scope for meaningful share price outperformance from current levels.
Companies: Empresaria Group
accesso Technology (ACSO LN) TE2 accelerates growth, but does not materially benefit EPS until FY19 | Alliance Pharma (APH LN) In line update; Diclectin UK approval expected Q3 | Cello Group (CLL LN) Trading update | City of London Investment Group (CLIG LN) FuM +7% in Q4, modest positive earnings surprise, better final dividend | Clinigen Group (CLIN LN) Clinigen Group (CLIN LN) | Horizon Discovery Group (HZD LN) Synergistic acquisition and proposed placing | Renold (RNO LN) AGM trading update reiterating expectations for FY18
Companies: CLL CLIG RNO CLIN HZD APH
Recent FY results were in line with expectations. Significant investment in facilities and people has positioned the group to up-scale its activities. Its ambition is to double revenue over the next five years through acquisitions and organic growth. The group should experience a recovery in its manufacturing business and is also well placed to continue consolidating a fragmented market, with acquisitions that extend its technology reach and result in market share growth. The shares remain attractively rated, at a discount to its peers, and offer decent upside to our 535p price target.
Companies: Solid State
Today we publish our H1 review of our Best Ideas for 2017 – the document in which we also outlined our key top down and bottom up investment themes for the year. Our 12 top picks in January were Cineworld, Elementis, Herald Investment Trust, Hill & Smith, IQE, MySale, Redde, ReNeuron, RhythmOne, SDL, Servelec and Severfield which have collectively outperformed the wider market by 13% YTD. At the half way stage we retire Cineworld and Hill & Smith from the portfolio (both were moved from Buy to Hold in May after outperformance), to be replaced by CVS Group and Renold. We also give a brief update on the rationale for our picks.
Companies: IQE RNO SDL CVSG ELM REDD RENE MYSL SERV HRI SFR RTHM CINE HILS
Diskus Werke is a sound business with a defensible leading market position, but extreme illiquidity in the stock curtails potential investor interest. Core clients’ industries, most notably automotive, are mature and cyclical and in 2016 profits were held back by losses at three subsidiaries. Eliminating this effect should boost margin, while diversification into the contract manufacture of end parts could boost the top line and profitability.
Companies: Diskus Werke
Good overall progress was achieved in H117 – although market conditions and business unit performance were somewhat mixed – and full year expectations are unchanged. A business strategy of increasing focus on better performing niche markets and margin enhancement is consistent with our double-digit earnings growth expectations. The rating acknowledges this and perhaps anticipates further improvement.
Companies: Low & Bonar
Last week the S&P 500 Information Technology Index set an all-time high, finally surpassing its prior record set way back in March 2000, at the peak of the dot com bubble. Far from being greeted with euphoria, the new high was seen as a red flag that the technology sector was once again overvalued and in the midst of tech bubble 2.0. We examine if these fears are indeed warranted. 2017 is shaping up to be a great year for Amazon. We see how Amazon’s 2017 Prime Day event fared and how its share price has performed since the start of the year
Companies: BBSN ECSC EUSP FDM PPIX QRT SPRP SQS SNX
Renold’s AGM update has confirmed that trading is on track to deliver FY18 results in line with expectations. The group has delivered strong underlying sales growth for Q1, ahead of our assumptions. However this outperformance has been offset by a decline in margin due to rising raw material costs, and while prices have been raised in response, there will be a time lag before this benefits margin. Growth prospects remain positive, with order intake 11.4% ahead of sales, or 4.7% ahead excluding revenues to be delivered post year end. STEP 2020 self-help initiatives remain on schedule. We do not anticipate making changes to our headline profit forecasts at this stage. The shares are trading on a significant discount to sector EV/EBITDA and P/E multiples and offer material upside to our target price.
On balance, most concluded he had been slightly more dovish than expected. ECB President, Mario Draghi, certainly did a good job in keeping the markets guessing during his Central Bank's Monetary Policy Statement and press conference yesterday afternoon. But in saying "We were unanimous in setting no precise date for when to discuss changes in the future," and going on to point out "In other words, our discussions should take place in the Fall, or in the Autumn, since we are in Europe", he appears to have ruled out the opportunity for next month's Jackson Hole Symposium to be his platform for the big announcement. Whilst he is simply putting off the inevitable, Draghi's insistence that "Inflation is not where we want it to be or where it should be", while also voicing commitment to bolster the bond buying programme should it be necessary, the 'can' now appears to have been kicked down the road to either the September or October meetings. This all left the US in a rather anticlimactic mood, having already received mixed macro news inputs as the Labor Department reported a fall in weekly first-time unemployment claims, while the Federal Reserve Bank of Philadelphia released a report showing that regional manufacturing activity grew at a notably slower rate in July and the Conference Board said its index of leading indicators rose by more than expected for the month of June. With a Bloomberg report suggesting the investigation into association between Trump's Campaign and Russia was also to be extended into his business dealings, the three major averages drifted downward shortly after the opening on profit taking, going on to traded fractionally either side of unchanged for the remainder of the session. Reporting majors Travelers and American Express both weighed on the Dow Jones after releasing dull second quarterlies, while Best Buy and Home Depot were hit after Sears said it would start selling its Kenmore line of refrigerators and stoves on Amazon.com; Trucking, Railroad, Telecom, and Steels also all met modest selling. Post-close, Microsoft firmed 0.9% in after-hours trading, on reporting that its quarterly profits had more than doubled, boosted by strong demand in its cloud operations plus tax benefits. So far, the Wall Street's Q2'2017 earnings have tended to surpass consensus expectations, which presently appears to be the principal bull support for equity indices which remain at or close to their record highs. Treasuries found demand as the ECB deflated some concerns over an early shift toward reducing monetary stimulus. The yield on the benchmark ten-year note fell as low as 2.239%, before settling virtually unchanged at 2.266%. Crude prices rose to a seven-week high Thursday, with the international benchmark Brent touching the $50/barrel level for the first time in more than a month during US hours, although this succumbed to profit taking late in the session and crude went on to decline fractionally during Asian trading. Traders eyeing the recent decline in US stockpiles, will be sensitive to this evening's weekly US Oil Rig Count data and Monday's meeting of OPEC delegates to review an extension to existing production cuts and discuss now also including Libya and Nigeria into the agreement. Following recent strength coming from Bank of America Merrill Lynch's bullish stance on Asia-Pacific equities, the region's markets appear to have somewhat run out of steam this morning. Just ahead of their close, most had made just fractional moves with only the S&P/ASX-200 showing a reasonable decline with its export plays being pressurised by the AUS$'s recent strengthening against the US$, while weak Energy stocks also kept the Nikkei pointing downward. European shares started on a positive note yesterday, following new record highs amongst the principal US indices on Wednesday and a firm closing of Asian trading first thing Thursday morning. This was further bolstered by strong earnings reports from media heavyweight Publicis and consumer giant, Unilever (ULVR.L). The STOXX 600 peaked almost 0.5% higher immediately before the ECB president spoke, but then collapsed into the red where it remained following the US's lacklustre opening. The Euro dipped slightly during this morning's Asian session, having extended recent gains to hit its highest level against the US$ since August 2015 yesterday. The IMF Board this morning has reportedly accepted Greece's latest bailout plans 'In Principle', while an earthquake in the county resulted in 2 deaths and multiple casualties. By comparison, the FTSE-100 opened in the positive yesterday, going on to rise further on receipt of better than expected June retail sales data and then just blipped modestly on the ECB statement, to close with a good 0.77% gain on the day. The highly international index benefitted from a further sharp fall in Sterling as the EU's Chief Brexit Negotiator, Michel Barnier, highlighted continuing "fundamental" differences over the issue of citizen rights and willingness to recognise obligation to pay exit bill that remained. Amongst individual stocks, Sports Direct (SPD.L) rallied as full year profits highlighted the damage Sterling's devaluation had inflicted to its full year profits, while easyJet (EZJ.L) led a round of profit taking amongst European airlines. There are limited macro releases due today. The UK details just its Public Sector Net Borrowing for June, while nothing is due form the EU and the US provides its Baker Hughes US oil Rig Count. UK corporates due to provide earnings or trading updates include Vodafone (VOD.L), Homeserve (HSV.L), Close Brothers (CBG.L), AO World (AO..L), Acacia Mining (ACA.L), Record (REC.L), Beazley (BEZ.L) and Capital & Counties Properties (CAPC.L). Majors reporting in the US later today include General Electric and Honeywell. Lacklustre overnight markets bode for a similar European opening this morning, with the FTSE-100 seen trading between 0 to 10 points down in early business.
Companies: EZJ HWDN UKOG ULVR