Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on SEB SA. We currently have 8 research reports from 1 professional analysts.
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Very strong growth
22 Feb 17
Organic sales growth remained dynamic in Q4 16 (+6%) and China contributed largely to the positive trend (+17.1%). In 2016, the operating income from the activity (€505m, +18%), or 10.1% of sales (+1.1pts), was above expectations despite a huge negative currency effect (€-122m). Q4 2016 sales: Sales reached €1,632m (+6.7%). Organic sales growth was significant (+6%) driven by Asia and the Other EMEA countries (respectively +13.3% and +19.5%). In Asia, China continued to be a fast-growing market for Seb (+17.1%). Conversely, there was practically no organic growth in Western Europe (+0.7%, o/w +4.1% in France) considering the high basis of comparison in Q4 15 (+9.1%) and the Americas (+0.1%, o/w -1.5% in North America and +3.1% in South America). FY2016 figures: Sales reached €5,000m (+4.8%). This included a negative currency effect (€-122m) and a change in the perimeter (€+60m) reflecting the contribution of OBH Nordica for 12 months vs 4 months in 2015 and EMSA for 6 months. Organic revenue growth was strong (+6.1% vs +8% in 2015) thanks to Asia (+12.3%, o/w +15.4% in China), EMEA (+5.6%, o/w +3.1% in Western Europe and +12.7% in the Other EMEA countries). Conversely, organic sales decreased in the Americas (-1.8%, o/w -4% in North America and +1.8% in South America). The operating income from the activity surged to €505m (+18%) and the margin rate improved to 10.1% of sales (+1.1pts) despite a huge negative currency effect (€-122m vs €-100m in 2015). The operating income was €426m (+15%) after higher other net operating expenses (€-42m vs €-25m in 2015) due to the reorganisation of operations in Brazil and acquisition/consulting fees related to EMSA and WMF. Group net profit was €259m (+26%) after higher net financial expenses (€-58m, +21%) due to commitment fees for the funding of WMF, a lower income tax rate (21.1%, -4.4pts) due to the utilisation of tax loss carryforwards in the US, lower minority interests in Supor following the purchase of 50m shares for a total of €196m. The operating cash flow was €452m. Seb funded the acquisition of EMSA and WMF by debt. At year-end 2016, net debt amounted to €2,019m and represented 110% of total equity. The net debt/adjusted pro forma EBITDA ratio was below 3x (2.81x). The proposed dividend in respect of FY2016 is €1.72/share (+11.7%).
Strong organic growth and margin improvement
26 Oct 16
Seb had a very good Q3 16 with strong organic revenue growth (+6.5%) and a significant increase in the operating result from activity (+21%) despite a negative currency effect. Q3 2016: Sales reached €1,204m (+6.8%). Overall growth included a negative currency effect (-1.7% or €-18m) and a change in perimeter (+2% or €21m) related to the full contribution of OBH Nordica (vs one month in Q3 15) and the integration of EMSA since 1 July 2016. Organic growth was 6.5%. Organic sales growth was attributable to Asia (+9.5%, o/w +10.2% in China) and the EMEA region (+6.9%, o/w +4.6% in Western Europe, +13.1% in other countries). The Americas was the weakest market (+2%, o/w +1.4% in North America, +3% in South America). The operating result from activity was €140m (+21%) corresponding to 11.6% of sales (+1.3pts). The improvement in the operating performance was attributable to the increase in volume, a price/mix effect and favourable raw material costs. 9 months 2016: Seb posted sales of €3,368m (+3.9%). Organic growth was 6.2%, o/w +11.9% in Asia (including +14.9% in China), +6.1% in EMEA (including +4.7% in Western Europe), -2.6% in the Americas (including -5.3% in North America, +1.4% in South America). The operating result from activity surged to €312m (+19%) after a significant negative currency effect of €-104m and a negative impact of €-3m related to the change of perimiter. Net debt increased to €619m on 30 September 2016 (vs €481m on 30 September 2015). In H1 16, the group funded the purchase of an additional 7.9% stake in Supor and the acquisition of EMSA in Germany.
Dynamic growth, margin improvement
25 Jul 16
H1 16 earnings Sales reached €2,164m (+2.4%). There was a significant negative currency effect (-€96m) due principally to the depreciation of various currencies of the emerging countries against the euro. Organic sales growth was significant (+6% vs +8.7% in H1 15) thanks to a positive contribution from all product categories, in particular vacuum cleaners, home comfort, beverage preparation and electrical cooking. Organic sales grew in two geographic areas (+13.1% in Asia, o/w +17.2% in China, +5.6% in EMEA). Conversely, organic sales dropped in the Americas (-5.4%, o/w -9.5% in North America and +0.4% in South America). The operating result from activity increased to €172m (+17.7%) and the margin rate improved by 1pt to 8% of sales. The negative currency effect was higher yoy €-61m (vs €-32m in H1 15) and was attributable to lower hedging gains on the purchasing currencies ($ and yuan) and the depreciation of the rouble, Brazilian real, South American pesos and Turkish lira. Operating income increased at a lower pace (+9% to €134m) due to higher profit sharing (€14m vs €8m in H1 15 becasue of improved results in the French operations) and Other operating expenses (€-24m vs €-15m in H1 15) which included provisions for restructurings in Brazil. Group net profit was €62m (+15%) after higher net financial expenses (+9.6% to €25m) and a lower income tax rate (-1pt to 24%) and stable minority interests following the purchase of 8% of the shares of Supor and an increase in the stake to 81% of the capital. Operating cash flow was €144m, reflecting strong operating income and a signficant reduction in inventories. Seb has a sound financial situation. On 30 June 2016, gearing was 39% and the net debt/EBITDA ratio was 1.14x since net debt increased to €629m (vs €453m on 30 June 2015) due to the funding of the purchase of Supor’s shares and the acquisition of EMSA in Germany. The acquisition of WMF is pending the approval of the authorities and the funding of the operation is expected by the end of H2 16.
A significant and attractive acquisition in Germany.
26 May 16
Seb has signed an agreement with KKR for the acquisition of WMF in Germany. The company’s product-portfolio includes automatic coffee machines for the professional market segment (37% of sales), cookware which comprises high-end stainless steel articles essentially (56% of sales) and premium tabletop equipment for hotels/restaurants/cruise ships (7% of sales). WMF sells its products under the leading WMF-brand and other brands such as Schaerer in Switzerland (professional coffee machines), Silit and Kaiser (cookware) and HEPP (hotel equipment). The company owns a network of 200 shops in Germany. In 2015, WMF had sales of €1,060m (+4.3%) o/w 74% in Europe (51% in Germany) and 26% well-balanced in the US (6%), China (5%), Japan and Korea (9%), rest of world (6%), and adjusted EBITDA of €118m, c.11% of revenue. The headcount comprises 5,700 employees o/w 3,800 people in Germany. WMF operates six plants in Europe (four manufacturing facilities in Germany, one site in Switzerland and one site in Czech Republic) and two plants in Asia (one site in China and one site in India). The purchase price for the WMF shares is €1,020m. In addition, the transaction includes the acquisition of WMF’s net debt and early retirement and pension liabilities by Seb, representing a respective €565m and €125m at year-end 2015. The operation will be funded by debt. Seb had low financial net debt of €184m as of 31 March 2016. The approval from the relevant competition authorities is expected in H2 16, but more probably at the end of the year. Seb has said that the integration of WMF will be accretive (>20%) at the EPS level during the first full year of consolidation.
A really good set of figures
29 Apr 16
Q1 16 figures Sales reached €1,115m (+2.3%). Sales growth included a negative currency impact (€-39m vs €+60m in Q1 15). Integrated on 1 September 2015, OBH brought in €9m for the quarter. Organic sales grew by 5.1%. This was a very good performance considering the high basis of comparison last year (Q1 14: +9.4%). Q1 16 organic growth corresponded to volume increases and a substantial positive price/mix effect. Price increases were implemented in various countries to offset the negative currency headwinds. Organic sales growth was driven by EMEA (+5.3% vs +7.9% in Q1 15) and Asia (+10.1% vs +15.1% in Q1 15). Within EMEA, Seb performed well in France (+5% vs +11.9% in Q1 15 which was boosted by a number of loyalty programmes). In Asia, China was the most dynamic market and Supor’s organic sales were up 12.5%. Conversely, organic sales decreased in the Americas (-5.5% vs +3.4% in Q1 15) due to a drop in sales in North America (-12.4% vs +6.4% in Q1 15). In South America, Seb performed well. Organic sales were up 4.3% (vs -0.1% in Q1 15) despite the adverse macro-economics in Brazil. The operating result from activity increased very slightly to €93m (+1%). It included a significant negative currency effect of €-45m which was higher than last year in the same period (€-15m in Q1 15). Price increases and the favourable product-mix offset the negative currency effects. In addition, Seb benefited from savings on raw material costs, reflecting lower prices and negotiations with suppliers. Seb continued to invest in marketing/advertising and R&D which are key-expenses for growth. On 31 March 2016, Seb had low net debt, i.e. €184m (vs €132m at year-end 2015 and €357m on 31 March 2015), thanks to a reduction in inventories.
Very strong organic sales growth in 2015
20 Jan 16
Seb delivered very strong organic sales growth in 2015 (+8%, 1pt above our estimate) and a positive organic trend in all geographic areas. *2015 sales:* Seb posted sales of €4,770m (+12.1%). There was a positive currency effect (+3.5% or €149m) attributable to the appreciation of the $ and yuan vs the euro which more than offset the negative impact of the Brazilian real, rouble and peso. The significant positive currency effect seen in H1 15 (€127m) declined in H2 15 (€22m o/w €10m in Q4 15). The integration of OBH Nordica increased overall sales growth by 0.6%. The strong organic sales growth (+8%) was principally driven by Asia-Pacific (+12.8%), Western Europe (+9.7% excluding France, +5.6% in France) and North America (+6.7%). Although South America and Central Europe/Russia/other countries were challenging, Seb succeeded in posting moderate organic sales growth (+3.4% and +3.9% respectively). *2015 results expectation:* Management expects an operating result from activity of close to €430m in 2015 (earnings release on 25 February 15). Our current estimate is in line with this (€436m estimated). These are a good set of figures, particularly considering the strongly negative currency effect which should be €-100m at the operating level in 2015 (vs €-94m in 2014, €-35m in 2013).
24 Mar 17
We note the share transaction yesterday, and think the stock will benefit from the increased liquidity. We continue to believe there is good valuation upside to the shares. However, we are terminating coverage of Watkins Jones from this morning and withdrawing our forecasts from the market.
Outperformance in the bag
24 Mar 17
IG Design has had a very good second half trading and has issued a year-end update indicating that numbers will exceed market estimates. We have lifted our FY17 and FY18 numbers by 8-10% at the pre-tax and EPS levels, following an 11% uplift to earnings with the interims. Particularly notable is the comment on strong cash flow, with the group reaching its target of average leverage less than 2.5x EBITDA two years ahead of plan. With the earnings and cash flow momentum, strong balance sheet and progressive dividend, there is good potential for further share price upside.
Panmure Morning Note 20-03-2017
20 Mar 17
Today’s strong H1FY17 trading statement is encouraging on multiple levels; (1) H1FY17’s revenue growth of c.+23% to £32m indicates revenue growth running well above our forecast assumption of +15% for FY17 (August 2017); (2) the revenue growth continues to be broad-based across the two main brand groups (Focusrite and Novation) and all of TUNE’s global regions (USA, Europe, and RoW); (3) H1FY17’s constant currency revenue growth of c.+12% is a sequential acceleration from the c.+9.5% of H2FY16 and c.+5.5% of H1FY16; and (4) H1FY17’s net cash of £9.4m is well ahead of our forecast of £7.7m by August 2017, reflecting strong revenue/profit conversion combined with much improved w/c control. In short, we think there is excellent scope for our FY17 forecasts to be raised at the time of the H1FY17 results on May 3. We maintain our BUY.
20 Mar 17
Focusrite has positioned itself in a way that makes its shares a particularly attractive investment: leadership in a niche product area protected from general consumer swings; an international market structure that makes it relatively currency agnostic; a habit of profit over delivery; a strong and further strengthening balance sheet; and an undemanding valuation. This first half trading statement confirms every one of those points.