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In Q3 FY23, Bic’s sales was below but the EPS was ahead of market expectations. The Group comparative revenue improved by 3.2% yoy, as the positive momentum in the stationary and shavers businesses (+1.2% and +13.9%, respectively) was partially offset by lighters (-1.3% yoy). Among the positives, the company gained market share in most regions and enjoyed a strong margin improvement in the Q3. We expect the margin progression to continue in the subsequent years. The management’s FY23 target is a
Companies: Societe B I C (BB:EPA)Societe BIC SA (BB:PAR)
AlphaValue
Bic hosted an Investors Day and shared the new financial targets of its Horizon strategic plan. We note management’s progress of the past 2-3 years and a credible roadmap through to 2025. The focus on all key levers (sales growth, margin progression and higher / sustainable FCF) are steps in the right direction. We will improve our financial estimates and target price. However, the stock’s valuation looks unattractive at the current levels.
Bic’s Q2 performance was stronger than the market expectations – sales were in line but the profitability was ahead. The company clocked +6.9% comparative sales growth during the quarter, led by positive contributions from all the business segments (Stationery: +6.7%, Lighters: +0.9% and Shavers: +16.8% yoy). All core geographies witnessed strong performances, except for North America which remained flat (+0.2% yoy). Despite this weakness, the NA business gained market share in all divisions, in
Bic’s Q1 FY23 revenue was in line but the adjusted EPS was 10% below the consensus. The Group’s revenue improved by 0.9% yoy (comparative basis), as the positive momentum in the human expressions and blade excellence divisions was largely offset by flame for life. Weakness is North America (-11.4% yoy) was the key headwind. We do not see any structural issues with the business and expect both sales and profitability to improve in H2 FY23. We will trim our financial estimates slightly but maintai
Bic’s Q4 FY22 performance was a mixed bag. Group sales grew 9.1% on a comparative basis (vs consensus: +7.7% yoy). However, the adjusted EBIT of €43.2m was 16.9% below the street’s expectations. For 2023, the management expects 5-7% sales growth (constant currency), an improvement in the adjusted EBIT margin and FCF of above €200m. While the sales growth in the Stationary business looks fragile, we expect its profitability (as for the overall group) to improve from 2023 onwards. We maintain our
Bic’s Q3 performance was a mixed bag – the comparable base was strong but EBITDA was below the street’s expectations. The group’s comparable revenue improved by 7.6% (vs consensus of +6.6% yoy), with strong momentum in two segments – Flame for Life (+11.0% vs consensus of +5.6%) and Blade for Excellence (+12.3% vs consensus of +8.3%). However, a c.20% slump in the group’s EBITDA and the management’s relatively cautious outlook on adjusted profit spooked investors. We maintain our cautious stanc
Bic’s Q1 FY22 performance was ahead of our as well as the market’s expectations. All business segments clocked double-digit growth. The adjusted operating margin benefitted from operating leverage, which was more than enough to offset the inflationary headwinds. Management now expects FY22 sales growth to be at the upper end of the 7-9% guidance. We expect the momentum to moderate in H2. Our positive stock recommendation is maintained.
Bic’s stock price has been under pressure for the past few quarters. This is despite the CEO (Gonzalve Bich) pressing ahead with a time-bound plan to turnaround the business. While the 2022 margins could witness some pressure, it is a non-structural issue in our opinion. The performance improvement plan is on track, plus management is potent enough to sustain top-line momentum during the mid-term. A cheap valuation (both fundamental and relative) also adds to the investment case.
The Q3 performance was ahead of AV and the market estimates. The top line momentum was largely led by the Stationery business. Geography wise, the US remained slightly soft, as other regions clocked positive growth. We expect FY21 to end with an overall improvement in profitability, despite the headwinds associated with rising raw material and freight costs. Our positive recommendation is maintained based on the valuation of the stock.
Benefiting from softer comps, organic revenue growth accelerated in Q2 with all three segments reporting double-digit gains. The profitability beat was also encouraging thanks to robust operational leverage. Based on these strong results, the FY21 sales outlook has been upgraded, though management still anticipates a deceleration in H2 given the challenging trading environment. Also, raw materials and freight costs are likely to remain high, due to the disruption of supply chains worldwide, and
FY21 has got off to a perfect start, led by strong growth in the US lighters market. Amidst weak market trends, shavers also reported decent numbers, thanks to value-added products and e-commerce. Nonetheless, within stationery, trading conditions worsened in developing countries, though solid demand for digital writing instruments provided some respite. FY21 sales are now expected to be at the higher end of the +5-7% range, though a volatile business environment refrained management from taking
Q4 20 was disappointing with all segments and geographies trading in the red – the stationery segment, particularly in emerging markets, was a key drag as online classes delayed back-to-school seasons. Given the continued weak underlying trends across segments, management anticipates a slow recovery in FY21, though new product launches, line extensions and strong commercial execution should keep the group afloat. In our view, investments into new avenues of growth (like Rocketbook, Djeep) could
Research Tree provides access to ongoing research coverage, media content and regulatory news on Societe B I C. We currently have 40 research reports from 3 professional analysts.
Surface Transforms has issued new revenue guidance for FY24, with the company now expecting revenues in the range £17.5-22m. We are withdrawing our previous forecasts for FY24 and withdrawing our price target while we review the impact of the new guidance.
Companies: Surface Transforms PLC
Cavendish
We note the regulatory announcement this morning from Surface Transforms and withdraw our estimates and valuation, pending conversations with management.
Zeus Capital
Companies: BILN ELCO NXQ CUSN ATG
Companies: Nexteq PLC
Canaccord Genuity
Surface has issued a brief Q1 update. Production will ramp-up this year as final new equipment is installed, and manufacturing teething problems recede.
Companies: UTL ASC DNLM BWNG MONY DFS BOO
Shore Capital
16th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radical Limited for
Companies: IP BILN SAR GATC ASTO PHE SHOE CCS IP CUSN
Hybridan
Dowlais Group’s first set of results were ahead of our expectations, with positive cash generation a highlight despite restructuring and demerger costs. Softer automotive markets will limit margin progress in FY24 towards the double-digit target. Despite this, margins of c 6.5% are still ahead of automotive peers, although the shares trade at a significant discount to our implied generic peer-based valuation.
Companies: Dowlais Group PLC
Edison
Companies: SCE HVO VLG
On 9 January last year, we set out our ten top stock picks for 2023, for what turned out to be another relatively poor twelve months for UK equities due to two wars, stubbornly high inflation and further tightening of monetary policy. This was even as other major markets, such as the US, largely recovered in the year. In the 2023 calendar year, the AIM All-Share index fell 8.2% and is still 42% off its 2021 high. From the release of our 2023 top picks note, the average total return (assuming div
Companies: PTAL GHH IGP MSLH PINE NXQ EQLS NXR AXL
Companies: GHH PHC GETB DEC LORD GELN
Companies: CPH2 ITM CNA AFC DRX IKA CWR CHAR IES AT/ HE1 ATOM
Liberum
17th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi
Companies: ARS TIDE SCE SNX ECK CNS TST SPEC SSTY
Gooch has issued a positive update for H1. Trading has started to recover with stocking levels normalising at industrial and medical devices customers. The outlook is positive with growth returning, and management has confirmed our full year estimates (adjusted for the disposal of EM4). The order book and order flow appear healthy, and net debt is comfortable. Gooch clearly still has plenty to do to lift operating margins from a lacklustre 8.1%, but the transformation plan appears to be back on
Companies: Gooch & Housego PLC
Nexteq’s FY23 results show adjusted EBITDA +4% ahead of the +6% upgrade at the January trading update, record FY23 EFCF of $17.4m, and a confident outlook that leads us to reiterate our FY24E revenue and upgrade FY24E gross profit, adj EBITDA, and EFCF by +1-10%. The strategic focus on higher-margin products and customers reducing elevated inventory levels led FY23 group revenue -5% yoy to $114.3m, with Quixant 6% lower at $69.3m and Densitron 2% lower at $45.1m. Effective supply-chain managemen
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