Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Alstom. We currently have 11 research reports from 1 professional analysts.
Alstom reported H1 17/18 figures which were above market expectations overall. Revenues reached €3,756m, 5% organic growth versus last year (€3,570m) and in line with expectations. Orders received amounted to €3,170m, a 49% decrease yoy (€6,212m), and included two contracts in Canada for almost 100 light rail vehicles, a first metro system contract in Vietnam, a metro system contract in Philippines, contracts for regional trains in Italy, Senegal and Germany, a maintenance contract in Sweden, as well as a fleet modernisation project in the USA. The backlog reached €32.7bn, slightly below last year’s level of €33.49bn. The operating profit was €231m (versus €200m last year), corresponding to a 6.2% operating margin (versus 5.6% last year). Net income was €213m (versus €128m) and FCF generation was €227m (€333m last year). The company confirmed its 2020 targets: 5% organic growth per year and an EBIT margin of 7%.
Deal confirmed with Bouygues; French and German states supporting the transaction. Creation of a pro forma €15.3bn company and adjusted EBIT of €1.2bn. Listing in France and group headquarters in Paris area; led by Alstom’s current CEO and 50% shares of the new entity owned by Siemens. Annual pre-tax EBIT synergies of €470m expected by the latest four years after closing (procurement, SGA, R&D and others). Up to €8 per share dividend to Alstom’s existing shareholders: €4 per share at closing + €4 per share after the exercise of the put options in the energy JVs with GE valued at €2.5bn (in line with AV’s estimate). The closing is expected at the end of 2018.
During Q1 17/18, Alstom recorded €1.91bn worth of orders (versus €900m last year), including two contracts in Canada for almost 100 light rail vehicles, a first metro system contract in Vietnam, contracts for regional trains in Senegal and Germany, a fleet modernisation project in the USA, as well as part of a metro system contract for Manila in the Philippines. Sales, at €1.9bn, were up 5% organically in the first quarter 2017/18. The backlog reached €34bn on 30 June 2017. Objectives for 2020 are confirmed: By 2020, sales should grow organically by 5% per year. The adjusted EBIT margin should reach around 7% by 2020, driven by volume, portfolio mix and the results of operational excellence actions. By 2020, Alstom expects a c. 100% conversion from net income into free cash flow.
Alstom has reported its annual results for 2016/17, confirming an improvement in both its operating and commercial performance. 2016/17 revenue reached €7.3bn, corresponding to +6% organic growth, and in line with expectations, while the order backlog reached €34.7bn (+10.6bn of new orders in 2016/17). The adj. operating profit reached €421m up 5% yoy, corresponding to a +5.8% margin, slightly above market and AV expectations (€411m). The net result was €289m (versus AV €296M), leading to positive FCF of €182m. The net debt was stable at €208m. The company is proposing a dividend of €0.25 and has confirmed its 2020 targets.
Alstom booked €1bn of orders in Q3 16/17 (versus €2.35bn in Q3 15/16) following very strong activity in Q2 (€5.3bn). For the first nine months of 2016/17, Alstom’s order intake reached €7.2bn, up 16% compared to €6.3bn over the same period last year. The group’s sales amounted to €5.2bn, up 6% yoy. The book-to-bill remained strong at 1.4x. Sales increased to €1.7bn, up 3% yoy, of which 2% organically. The company also announced a €190m metro system contract in Vietnam. Objectives for 2020 confirmed: By 2020, sales should grow organically by 5% per year. Adjusted EBIT margin should reach around 7% by 2020 driven by volume, portfolio mix and the results of operational excellence actions. By 2020, Alstom expects c. 100% conversion from net income into free cash flow.
Alstom reported strong figures in H1 16 which were above market expectations. Main facts: Order intake reached €6.2bn, a +66% yoy organic increase and leading to a record €33.6bn order book (+22% yoy organic increase). Revenues came in at €3,570m, a +7% organic increase. Adjusted EBIT was up 20% yoy at €200m and corresponding to a 5.6% margin (versus 5.1% in H1 15). Free cash flow of €333m (versus €-1,336m), was exceptionnaly high with several down-payments. 2020 guidance confirmed: organic growth of 5% per year and the EBIT margin to reach 7%.
Alstom booked €0.9 bn of orders in Q1 16, compared to c.€2bn over the same period last year. Sales reached €1.7bn and were up 7% organically over Q1 2016/17 mainly driven by regional, high-speed and suburban trains in France, regional trains in Italy, Germany and Sweden, the progressive ramp-up of the PRASA project in South Africa, maintenance of high speed trains in the UK as well as a signalling project in Canada. At €29.7bn on 30 June 2016, the backlog represented over four years of sales.
Alstom reported positive full-year 2015/16 results, which confirmed back to normal, coupled with positive prospects ahead according to the 2020 strategic plan. Main facts: Orders grew 7% yoy at €10.64bn (versus €10.05bn in 2015/14) while the backlog reached €30.63bn, a +14% yoy organic increase and corresponding to more than four years revenue. Revenue was €6881m, 12% growth reported but corresponding to 7% organic growth. The adjusted EBIT was €366m, a +23% increase, corresponding to a 5.3% margin versus 4.8% last year. Net debt was €200m at the end of March 2015. Net income was €3.0bn, impacted by the selling of the energy division. The company confirmed its 2020 targets: By 2020, sales should grow organically by 5% per year. Adjusted EBIT margin should reach around 7% by 2020, driven by volume, portfolio mix and the results of operational excellence actions. By 2020, Alstom expects c. 100% conversion from net income into free cash flow.
Alstom Q3 results and press conference call on first nine months’ orders & sales for FY 2015/16 (April 1st to December 12). Alstom booked €2,358 million of orders in Q3 2015/16, versus €1,615 million last year corresponding to a +46% increase. Major commercial successes included regional trains in Belgium, Pendolino trains and associated maintenance in Italy, electrification, a signaling and telecommunications project in India, locomotives in Switzerland, regional trains in Germany, extension of the metro in Panama as well as the tramway for Nice in France. Revenues increased to €1,613 million in the third quarter 2015/16, compared to €1,501 million for the same period last year. (7.4% increase). Nonetheless, Q3 organic sales growth was around 3% on a YoY basis, falling below the 5% organic annual sales growth target previously announced by Alstom Chief Executive Officer Patrick Kron. These results give the company a book-to-bill ratio of 1.46x for the quarter and 1.29x for the first nine months. In the press conference Mr. Kron stated that the GE Signaling business, acquired in November 2015, had been consolidated in the last two months' results and had generated €60m of Sales over this period (€360m on an annualised basis); this was slightly disappointing given the expected €400m increase in annual Sales. Thanks to the grid and power businesses divestment, Alstom is sitting on a substantial amount of cash, even after the $3.2 billion share buyback, the €700m acquisition of GE’s signaling business and the stake increase in Russia’s Transmashholding from 25% to 33% late last year for 54 million Euros. The company is currently net debt free, meaning that in-hand cash balances the gross debt, giving the company a window for external growth and/new share buybacks although CEO Patrick Kron did say in the press conference that external growth and share buybacks were not the first priority. The press conference was Mr. Kron's last and he took the opportunity to thank his teams for the ‘’great work they’ve done’’ during his 13-year career as CEO. He is replaced by the Alstom Transportation’s segment president, Mr. Henri Poupart-Lafarge.
Alstom reported its H1 15/16 results, governance changes and a return to shareholders.
Alstom reported €1.96bn of orders in Transport for its Q1 15/16, a 59% decrease yoy but Q1 14/15 included the jumbo contract of €4.0bn in South Africa. If we exclude the jumbo contract, the order level is rather strong in comparison with last year although fuelled by small and mid-sized contracts including maintenance of Kazakh locomotives, locomotives in Azerbaijan and a signalling system in Hong Kong.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Alstom. We currently have 11 research reports from 1 professional analysts.
We are upgrading our forecasts, target price and recommendation on AB Dynamics. Thanks to a growing portfolio of unique testing products that are critical to developing and launching increasingly sophisticated autonomous driving in shortest possible time, we now believe that AB Dynamics can grow at 28% per annum over the next three years. This is much superior growth to Renishaw, the top rated UK robotics/automation stock, which has a consensus forecast CAGR of 8% over the next three years. Applying Renishaw’s 2018 EBITDA multiple of 23x to AB Dynamics generates a minimum valuation of 1,030p per share. We therefore raise our target price to 1,030p and recommendation to BUY. Frankly speaking, for UK investors starved of mainstream self-driving/electric car plays there are very few alternatives.
Companies: AB Dynamics
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 CFHL CYAN ISL DTC DOTD ELCO ESV FDEV GBG IDEA IDOX IMTK IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET ONEV PHD QTX QXT RCN 932 SSY SEE SIM SPE SRT STR TAP TAX TEP TPOP TRAK UNG VIP ZOO
T Clarke’s trading update strikes a confident tone and reiterates full year expectations. After a period of share price weakness, we expect this to be well received, with the order book for outer years also being replenished. The Group is on track to deliver PBT of £6.5m and revenue in excess of £300m, which would represent another year of good progress after the significant profit growth of the past two years. It has been a busy period for the Group, which has seen the handover of two significant schemes, Bloomberg HQ and Facebook’s new London HQ at Rathbone Square. The integration of ETON Associates (acquired in August) is progressing well and the reception from the market place has been positive. The order book stands at £380m (£320m at this stage last year) and importantly £190m of planned revenue for FY18 (c.60% of our forecast) has already been secured.
Solid State* (SOLI): Interim results, distribution shows strong growth (CORP) | Europa Oil & Gas* (EOG): Holmwood planning update (CORP) | President Energy* (PPC): Open Offer result (CORP) | Stride Gaming (STR): Back to form (BUY) | Stride Gaming (STR): Back to form (BUY) | Telecom Plus (TEP): Optimism at interims (BUY) | Renew (RNWH): Solid foundation for continued growth (BUY)
Companies: SOLI EOG PPC STR TEP RNWH
Keystone Law Group— full service law firm with over 250 self-employed lawyers . Due late Nov. Offer TBA | Beeks Financial Cloud -niche cloud computing and connectivity provider for automated (algorithmic) trading in Forex and Futures financial products . Raising £7m. Mkt Cap c.£24.5m. Due 27 Nov. FYJun17 rev £4m. Profitable at operating level | City Pub Group - owner and operator of an estate of 34 premium pubs across Southern England. £30m raise. Consistent track record of strong revenue and EBITDA growth, with a three year CAGR from FY14 to FY16 of 34.9% and 44.8% respectively, and an EBITDA margin of 14.7% in FY16. Due late Nov. Offer TBA | Boku - Independent direct carrier billing company. Revenues were up 21% to US$10.2 in HYJun17. Q32017, revenues grew to $6.5m, up by 44%. The Company also saw continued growth across all of its key metrics: user numbers, total payment and a positive adjusted EBITDA for the month of September 2017. Due 20 Nov. Offer raising £45m at 59p with mkt cap of £125.9m | Ten Lifestyle Hldgs. Technology-enabled lifestyle and travel platform providing trusted concierge services to the world's wealthy. Net revenue increased from £20m in the year ended 31 August 2015 to £33m in the year ended 31 August 2017, a compound annual growth rate of 29%. Offer TBA, expected 27 Nov 2017 | OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m | OG Graphite, brownfield development-stage graphite company focused on the reactivation of its wholly-owned Kearney natural flake graphite mine and mill located 280 km north of Toronto, Canada. Offer TBA, expected mid November |
Companies: FRR AST ABDP BZT AVCT MTFB WEY FFI SAV
Elementis (ELM LN) Share price drift presents buying opportunity | Springfield Properties (SPR LN) Springboard to sustainable long term growth | T. Clarke (CTO LN) Positive update, order book building for FY18/19
Companies: TClarke Elementis
In the November edition of the Hardman Monthly Newsletter, Nigel Hawkins assesses the achievements of AIM – and how it has thrived, despite a challenging financial environment, in recent years.
Companies: SPH AVO SCLP VAL AGY CLIG TRX AVCT APH CMH MCL MUR
Xaar has issued a trading update downgrading expectations for 2017. This has been driven by lower sales of the 2001 printhead in the competitive Ceramics market, as well as a slower ramp-up of the new 1201 printhead for Graphic Arts due to supply constraints. Management is guiding to H2 17 sales broadly in line with H1, which we have reflected in our estimates, along with reductions for the following years. This has driven cuts in our adjusted PBT forecasts of 31% for 2017, 15% for 2018 and 5% for 2019. These downgrades are disappointing. However it is notable that the issues relate to the decline of Xaar’s legacy Ceramics business, along with short-term issues in meeting demand for the new Graphics product. Demand continues to grow for the portfolio of new products introduced in the last two years, as previously reported. The group’s transition continues towards more diversified and resilient revenue streams, and more effective leverage of its IP, albeit with more volatility than had been hoped. The group’s new and broader product portfolio offers exciting growth prospects, with management’s vision unchanged of £220m sales by 2020.
The company has today warned that revenue in the second half of the year will be broadly in line with the first half. The shortfall against previous expectations of growth results largely from fewer than planned new printer installs of Xaar's 2001 Printhead, and slower than anticipated ramp up of the Xaar 1201 Printhead due to supply constraints. We are placing the stock under review as we assess our forecasts and recommendation.
Avon Rubber has delivered a confident FY17 performance and has set out a clear threefold strategy to drive medium-term growth. The core business is buoyed by strong order activity in Protection while dairy market trends look set to stay positive into 2018. Cash performance has also been solid, which underpins selective future acquisitions.
Companies: Avon Rubber
Empresaria is an international staffing group operating a multi-brand strategy and addressing both permanent (FY16 revenues 40%) and temporary (FY16 revenues: 60%) recruitment markets. We have today reduced our forecast expectations
Companies: Empresaria Group
The 2017 fiscal results and the outlook reported last week were broadly in line with our top of the range forecasts for FY17 and beyond. Therefore, fundamentally, there is no change to our forecasts for FY18 and FY19. The company has successfully allayed investor concerns over the expected fall in M50 sales with significant gains in other masks/respirators with the DoD and the MoD, and without requiring the help of acquisitions. However, we have adjusted our numbers marginally to account for the negative impact from strength of the sterling against the US dollar. We believe, ultimately, that current forecasts are academic in that we expect the management to deploy the strong balance sheet on acquisitions. With £25m of net cash at end-October 2017, it has the capacity to spend around £90m and still keep net debt to EBITDA around 1.5x.
Companies: Avon Rubber
A strong set of interim results from Severfield this morning, indicating that full year results are expected to be comfortably ahead of previous expectations. All key metrics were moving in the right direction in H1. Revenue was up 16% to £137.1m and further self help led the operating margin higher to 9.3% from 7.0% last year, slightly flattered by a number of contract completions in the period. Adj. PBT was up 59% to £12.9m. Encouragingly, the order book has increased, with the UK order book at £245m in November vs. £221m in September and the India order book at £79m vs. £64m in September. The Group continues to win contracts across its end markets and with a strong pipeline of projects, we are confident that Severfield is on its way to achieving its target to double PBT by FY’20 (from £13.2m in FY’16). We expect to upgrade our current year PBT forecast by 11% to c.£23.5m. Trading on an FY’18 P/E multiple of 9.7x (post upgrades), we believe that Severfield is attractively valued vs. peers.
While a trading update might have been anticipated the departure of the CEO is a major surprise. The return of the Chairman to the CEO role as an interim measure provides an element of reassurance and continuity, as does the commitment to an increased final dividend despite a cut of 9% to FY17 EPS. The UK declines are concerning, however it is not the largest regional contributor. We believe the larger US and export market contributions and recent order intake should provide a solid foundation for future growth, with the invest and grow strategy to remain in focus.
Companies: Ultra Electronics
Vp’s interims confirm another period of significant progress. The key infrastructure, residential and general construction markets remain supportive and Vp is investing in fleet expansion and M&A to accelerate growth. The outlook statement is confident and the Group is well on track to deliver a strong full year outturn. Having upgraded FY19 by 14% for the Brandon Hire acquisition last week, we leave our PBT forecasts unchanged at this stage, but nudge EPS higher by 2%. We also introduce FY20 forecasts, which give an indication of the full potential of the Brandon deal, showing 6% PBT growth yoy. In our view, an FY20 P/E rating of <9x significantly undervalues this high quality Group.