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Research Tree provides access to ongoing research coverage, media content and regulatory news on Legrand. We currently have 53 research reports from 4 professional analysts.
Legrand’s Q4 19 results beat expectations, with a higher-than-expected organic growth of 2.6% and FCF of €1,1010m. Despite a tough macro environment, Legrand ended the year with a good performance. Management reaffirmed its ambition to become a “strategic player” in connected buildings. The 2020 guidance is wide (cautious), though in line with our current estimates which are within at the mid-point. It trades on high levels, which might be seen as expensive, but the digital equity story is what matters now.
Legrand reported a lacklustre set of Q2 results, albeit in line with expectations. The organic revenue growth of +1.5% was not really convincing and the operating margin declined 40bp to 21.3% (or 22% adjusted for acquisitions). Management is confident regarding the activity in H2 which should benefit from favourable comps and several new product launches.
Legrand reported mixed results this morning with declining margins over the first quarter. This was mainly due to the French market which posted weak organic sales mainly due to destocking over the period. After a strong performance year-to-date (+33%), we see more room for consolidation following the disappointment in margins.
Legrand posted a solid set of numbers for its Q4/FY18 results. 2018 sales reached €5,997m, an 8.6% change yoy of which 4.9% organic. For Q4 18 alone, organic growth reached 5.2%. The adjusted operating profit was €1,212m, a 9.7% increase yoy and corresponding to a 20.2% margin. For Q418 alone, the margin was 19.9%, up 100bp from 18.9% in Q4 17. The net attributable profit was up 23% to €772m for FY18, leading to a strong FCF of €746m. Legrand expects organic growth in sales of between 0% and +4% in 2019 coupled with an adjusted operating margin before acquisitions (at 2018 scope of consolidation) of between 19.9% and 20.7% of sales in 2019.
Legrand reported F9M18 revenue of €4,437m, +11.3% increase yoy (+4.8% organic growth), coupled with an adjusted profit of €908m corresponding to a 20.5% margin to sales. Net profit grew by 21% yoy to €574.5m and FCF was 6.4% higher at €441.6m. In Q3 18, organic revenue growth was +3.9%, but this was impacted by a one-off in France (-4.3% yoy organic decline in Q3 18). The adjusted operating margin was 18.8% in Q3 18, 160bp lower than in Q3 17. Legrand adjusted its FY18 guidance for organic revenue growth to “close to 4%” versus “between +1 and +4%”, and the adjusted operating margin remained unchanged at “between 20% and 20.5%”.
Legrand reported robust figures for Q1 18, including a +3.9% organic growth coming from both mature & developed countries. The adjusted operating margin before acquisitions rose thanks to the company’s ability to pass on raw material price inflation to clients. The FY18 guidance is maintained, while Q1 points now more for the top of the range. Encouraging.
A strong Q4 17, including 3.6% organic growth led by France (+5.8%) and Italy (+5.7%). The adjusted operating margin was a tick lower in Q4 17 at 19% (versus 20% in 9M17) but, for the whole year 2017, the OP is finally in the higher range of the company’s guidance. The prospects remain positive for 2018, and the company aims to continue to grow organically by a low single-digit (1-4%) coupled with an operating margin between 20% and 20.5%.
Legrand reported solid Q3 17 figures. Q3 17 sales increased by 2.4% organically, mainly driven by Europe. For the first 9M17, revenue increased by 7.7% In Q3, the operating margin was 19.5%, in line with H1 17, as well as the adjusted margin before acquisitions at 20.6%. For the first 9M17, the operating profit increased by 10% yoy. Net profit increased by 11.4% for the first 9M17, while the normalised FCF increased by 12.2% to €542m. Net debt was €2,284m (a +99% increase yoy) as a result of the five acquisitions during the year. Acquisitions should continue to drive growth, adding nearly 15% to the group’s growth over two years. Legrand raised its minimum targets for organic growth from “0 to +3%” to “2 to 3%” and also the adjusted operating margin from “19.3 to 20.1%” to “19.8 to 20.1%”.
H1 17 Highlights : • Total sales grew by 9.1% to €2,671m, driven by organic (+3.2%) and external growth (+4.1%) while the exchange rate effect was +1.6%. • Adjusted operating profit increased by +10.9% to €546.3m. • Adjusted operating margin has improved by 30bpsto 20.4% of sales. • Double-digit increase in results and cash flow. • Net profit attributable to the group has reached €316.2m (+11.5%), while free cash flow amounted to €227.8m (+19.1%). Legrand confirmed its 2017 targets on the basis of its strong showings in the first half. It still expects an organic growth in sales in the 0-3% range and an adjusted operating margin before acquisitions of between 19.3% and 20.1% of sales. Nevertheless, the company did not raise its outlook for FY17 as it still expects unfavourable impacts on sales in Q3 due to calendar effects and a high comparison base.
Legrand reported Q1 17 results above expectations - Sales reached €1,318.8m vs €1,189.6m in 2016 (+10.9% yoy change). - The operating profit increased by 14.3% yoy (€246.9m vs €216m in Q1 2016) - The free cash flow reached €83.1m in 2017 vs €37.4m in Q1 16. - Organic growth in sales: +4.6% - Payment of €1.19 per share dividend Legrand confirmed its 2017 target on the basis of its strong showings in Q1 17. However, the company takes into account the unfavourable effects on sales in the coming quarters. Firstly, the effect of orders placed in advance by distributors should reverse in Q2. Secondly, the high comparison basis in Italy and the US and the calendar effect should weigh negatively in next quarter. Legrand confirms organic growth in sales of between 0% and +3% and an adjusted operating margin before acquisitions of between 19.3% and 20.1% of sales.
Legrand reported its Q4 16 and FY16 figures. - Growth excluding FX: +6.5% (vs. +2.1% in 2015), of which organic growth of 1.8% (the target was 2%) and external growth of 4.7%; - 8 acquisitions were made in 2016 vs 4 in 2015: over €170m annual sales acquired; - Adjusted EBIT margin before acquisition: 19.7% when the target was 19.6%; - Total sales have been reached €5,019m (vs €4,810m in 2015): growth of 4.3%; - Adjusted net income excluding minority interest up 3% to €567m; - Robust cash flow from operations: €791.4m, i.e. 15.8% of sales; - Net debt has risen by €0.8bn to €1.0bn including more than €300m dividend paid and more than €400m invested in eight acquisitions (vs >€250m in 2015); - Dividend proposal: €1.19 in 2016 (+3.5%) from €1.15 in 2015.
Legrand 9 Months 2016 total Sales grew +4.1% (+2.1% organic) . Company Mgmt Guidance for 2016 is +2% in Organic Sales with 19.4% Ebit Margin (from 19.3% in 2015) By Regions, France organic Sales dropped -2.3% in 9M 2016 (base effect will be clearly negative in Q4 2016 in France !), Europe grew +5.7% (17% of total Sales), Italy +3.8% (10% of total) North America +6.5% (30% of total) and Others -2.2% (25% of total) with weak Sales in Brazil and Middle-East
Legrand reported satisfactory numbers for Q3 16 Revenues in the first 9M16 came in at €3.7bn, a +4.1% increase yoy, of which 2.1% organic growth. In Q3 16 alone, organic growth reached 2.5% and was mainly driven by North America (+7.8%) and other Europe (+5%), while Italy grew 2.4%. The operating margin in the first 9M reached 20% (20.2% before acquisitions), +5.7% yoy, and in Q3 16 alone the adjusted operating margin was 19.7%. FCF generation was also very strong at €482.5m (versus €479.8m) representing 13% of sales. The company revised its FY16 guidance slightly upwards with organic growth now expected between 0% and +2% (versus -2% to +2%) coupled with an adjusted operating margin of between 19.3% and 19.6% (versus 18.5% to 19.5%). The company achieved eight acquisitions since the beginning of the year, totalling annual acquired sales of over €170m, of which 80% with products N°1 or 2 in their markets. For 2016, acquisitions should contribute over +4% to growth.
Legrand released its H1 sales, reaching €2.45bn vs €2.41bn yoy. Also, H1 adjusted operating profit amounted to €492.7m vs €478.1m yoy. Its H1 organic growth in sales stood at +1.9% as a result of solid performance in the US growing by +5.5%, while growth in mature European economies reached +1.6%. Legrand’s net profit stayed at €283.5m but decreased slightly as a percentage of sales. Finally, the Eliot programme that Legrand launched in 2015 continued successfully and ahead of schedule in implementing targets set in the programme. The group confirmed its 2016 outlook saying that it expects organic change in sales of between -2% and +2%, and adjusted operating margin before acquisitions of between 18.5% and 19.5% of sales.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Legrand. We currently have 53 research reports from 4 professional analysts.
Trading below its 5-year PE low, compelling entry point
Companies: Somero Enterprises
Results ahead; forecast upgrades, special dividend, yielding 7% SPSY has announced a strong set of results, with EBITDA and PBTA some 6% and 4% respectively ahead of our forecasts, following a succession of upgrades and some notable wins during 2019. Reflecting the strong momentum, and with forecasts well supported by firm contracts which exist independently of the current global crisis, the company is (1) trading ahead of expectations in the current year, and (2) with strong cashflow, feels confident to announce a special dividend this morning to be paid in June. With meaningful upgrades to the current year, and new, progressive, forecasts for FY2021E, the current outlook is strong at a time when this is rare for a mid-cap company; while key opportunities developed over the past eighteen months continue to be highly promising. SPSY provides advanced technology solutions for banknote, product authentication, and secure lottery transactions as a highly specialised operator, working in fields which offer valuable respite from Covid 19. Cash of $US14.3m is ahead of our expectations and some 13% ahead YoY. Well-invested and with well-controlled costs (and high gross margins), today's results provide further support for our fair value assessment, which in turn is far ahead of the current share price.
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US & German manufacturing PMI hits lowest readings since 2009, UK manufacturing PMI heads below 50, BorgWarner expects material financial impact from customer production halts
Companies: AVON CGS HAYD HEAD HILS JHD RNO SCPA TWD TRI ZTF SOM GHH
3 weeks ago, we thought the coronavirus would be a Chinese/Italian phenomena impacting global supply chains, but not triggering full/partial lockdowns across large swathes of the planet. How things have changed.
The Indian Government and Reserve Bank of India has announced several relief packages to combat the adverse impacts of COVID-19 and the lockdown implemented last week. The lockdown encompasses all non-essential industries and has resulted in OPG's industrial customer shutting down operations and reducing their short-term demand levels. As a result of the current market uncertainty, we are withdrawing our forecasts from the market and move our recommendation to Under Review until macroeconomic conditions stabilise. We believe OPG's strong portfolio of customers from diverse industries will enable it to quickly revert to normal operating levels once the situation improves.
Companies: OPG Power Ventures
Breedon is effectively moving to a (temporary) lockdown position on all its sites save Hope cement plant (which will produce to storage) and those in the Republic of Ireland where the principal customer is central and local government and as such will continue to operate until directed otherwise. Crucially, the group is in a strong financial and liquidity position with undrawn facilities of £220m and £60m in cash whilst any unwind of working capital from here is likely to actually generate cash. Moreover, the planned £155m cash outlay on the Cemex assets to be acquired is almost certain to be delayed beyond the coronavirus period due to the associated stalling of the TUPE process and IT migration. This position seen against a cash ‘burn' of probably no more than £15m per month (gross of any government support schemes and noting employee cost is the largest single constituent of fixed overheads) is comfort indeed for shareholders. We are withdrawing our forecasts for 2020 (formerly £200.7m of EBITDA, £113m underlying PBT and 5.6p EPS) and beyond on the simple basis that we cannot predict either the depth or duration of the coronavirus impact. Nonetheless we are happy to retain a Buy on the basis that: (a) there will be no structural damage done to the group's operational, asset or financial base as a result of coronavirus, (b) it should see a rapid scale-up when normality returns and (c) management can be relied on to re-assert relative growth versus its peers which has been a hallmark of Breedon's history to date. For long term investors these are opportune times.
Companies: Breedon Group
At Recruitment, there is a significant variance between customer segments, with food currently strong. Staffline is well placed to benefit from its strong candidate database.
Companies: Staffline Group
The latest body armour contract for the US Defense Logistics Agency is for up to $333m, to be delivered over 3.5 years for a legacy product. Avon had identified it as an incremental value-creating opportunity which, when won, would trigger the contingency consideration of up to $25m for the Helmets and Armor business acquired at the start of 2020. We have increased our FY21 EPS estimates by 13% following the award of the first delivery contract. Avon operates in defence and dairy markets that should be relatively resilient as they are deemed essential in the US, UK and Italy.
Companies: Avon Rubber
Despite a promising start to the year, Filta has inevitably been impacted by the widespread closure of sports venues, universities, restaurants and other similar sites across its key markets, in order to control the spread of COVID-19. This has led to a material reduction in trading. Given the lack of certainty around when such restrictions will be eased, or how quickly consumers will return to normal habits once they are, visibility in the business is very limited at this stage. As such, we withdraw our FY20E forecasts and move our rating to Hold, until such visibility improves.
Companies: Filta Group
The Group has announced interim results, which include the impact of the decision to cease its Thin Film operations, and also extensive Board changes. In view of the Stratasys transaction we remain restricted and can therefore provide factual comment only. Interim results show an IFRS loss before tax of £52.3m and an adjusted loss before tax of £15.0m. A separate announcement covers management succession that will see the Chairman, SID, CEO and CFO leave the Group.
SMS has the morning issued an update to the market in relation to Covid-19. SMS has, with immediate effect, temporarily halted all non-essential field engineering activity, including the installation of smart meters. Essential emergency field engineering work will continue and SMS has increased safety procedures in place to ensure the protection of employees, supply chain and consumers. Whilst this short-term halt in installation activity will have some impact on profitability in the current year, SMS benefits from sustainable and predictable (upwards only) index-linked annually recurring meter rental and data service revenue (£73.2m at end February 2020) which is totally unaffected by the current environment. Whilst the short-term impact on profitability is difficult to quantify precisely and will depend on the length of time installation activity is halted, the full 2m smart meter order book will remain to be completed in its entirety once installation activity recommences. The longer-term prospects for SMS are thus unaffected in our view and the business comfortably has the balance sheet resources and expertise to see it through this difficult period.
Companies: Smart Metering Systems
Unscheduled trading statement indicates an adverse impact from C-19 on the business. In the absence of guidance, we reduce our FY20 FD EPS by 52% from 12.0p to 5.8p. The high public sector exposure around the world is positive.
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discoverIE’s year-end trading update confirms that coronavirus-related disruption in China is expected to modestly affect FY20 earnings. While trading elsewhere has been as expected, with good order wins, efforts to contain the virus in Europe and North America could reduce demand and introduce supply constraints over at least the next quarter. We have revised our forecasts to take a more cautious stance in H121 before factoring in a recovery starting in H221.
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FY19 Results: in line with January Trading Update
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For fighter pilots, it is a minimum requirement. But having 20/20 ‘visual acuity’ (correct term) does not necessarily mean you have perfect vision (as convention assumes); instead, it indicates sharpness and clarity of vision at a distance. It is measured by a Snellen Chart, which displays letters of progressively smaller size and whereby 20/20 means that the test subject sees the same line of letters at 20 feet that a person with normal vision sees at 20 feet (or 6 metres; but 6/6 simply didn’t catch on).
Companies: ABBY BDEV BWY BKG VTY CRN CSP CRST GLE GLV INL MCS PSN RDW SPR TW/ WJG