Bolloré closed an upbeat Q3, posting impressive revenue growth for its Transportation & Logistics business, as well as a sales surge for Oil Logistics boosted by rising oil prices. On the Vivendi side, the de facto takeover bid of Lagardère following its agreement signed with Amber Capital points to the family’s next major move after the successful completion of the UMG spin-off, which has led to the Bolloré parent holding an 18% stake on the now independent crown jewel.
Companies: Bollore (BOL:EPA)Bollore SA (BOL:PAR)
Bolloré could be looking to exit its long-standing logistics activities in Africa according to French media. Although the company has not commented on the matter — so it remains all speculation — we see this potential move as a clear positive. Bolloré is faced with the high capital intensity of the business while affronting competitive pressures from deeper-pocketed and expanding rivals. Supportive valuations for logistics & port operators and the upcoming departure of Vincent Bolloré suggest th
In a letter addressed to Vivendi, Bolloré has committed to not ask the French market authority (AMF) for an exemption of launching a takeover bid on Vivendi, triggered if the HoldCo finds itself crossing the regulatory threshold of 30% of the share capital.
Bolloré closed a strong first quarter for its Transportation and Logistics division, partly offset by the weakness from Oil Logistics, while Vivendi was led once again by top performer UMG (soon to be spun-off). The transport and logistics activity outperformance was driven by the strong trading environment stemming from global inventory rebuilding efforts as cyclical sectors emerge from a post-pandemic slumber, a trend that should extend through H1 21.
Vivendi has finally revealed its future plans for UMG, with Bolloré now finding itself as one of the major beneficiaries from the upcoming spin-off of what is, by far, Vivendi’s most valuable asset. This surprising development, which has been most likely orchestrated by Bolloré (up to a certain extent), could result in a complete rethink of the HoldCo’s investment strategy for years to come.
Companies: Bollore SA
Following the unexpected resilience shown by the transportation & logistics division in H1, the third quarter trading statement held fewer surprises. The second half seems less challenging than expected for Bolloré’s key businesses, with both communications and transportation & logistics posting very modest, but still positive, sales growth. Nonetheless, the continued weakness in oil logistics risks pulling down the group’s full-year results.
While we were anticipating Bolloré’s Q2 to be tough, particularly for its transportation & logistics division, an unexpected rise in air freight and positive price developments supported the division’s trading results and profitability in H1. The proven resilience of Vivendi (and UMG in particular), in addition to stronger ‘core activities’ at the Bolloré level, point to a less gloomy outlook despite the challenges of a still uncertain H2 economic recovery.
While Bolloré’s group revenues in Q1 saw a limited impact from the COVID-19 outbreak, banking on Vivendi’s relative resilience to the crisis may not prove to be enough to offset the negative impact on the holding’s transport and logistics activities. The 2020 scenario for Bolloré ex-Vivendi remains quite challenging indeed.
Bolloré released sales figures that, despite falling in line with our estimates, paint a worrisome picture for the group’s ‘core activities’ (i.e. excluding Vivendi). Particularly in the context of a latent global slowdown due to the Covid-19 outbreak and its potential impact on global freight volumes and oil product prices. The outlook for 2020 may not differ much from the disappointing performance of Bolloré’s core businesses in 2019.
The widespread decline in air and sea freight volumes spurred on by the trade war and the uncertain macro-economic environment is catching up with Bolloré, with revenues decreasing by 4% lfl in Transportation & Logistics. Nonetheless, the scenario is more upbeat in the Communications division, as UMG continues to post solid rates of growth (up +16%), much to the benefit of Vivendi (+7%). Opportune disposals of non-core assets should keep the cash flowing in spite of a challenging outlook for Bol
Capital Continues to Flow Into LMIs
Through April and May we have seen three more listed managed
investment vehicles (LMIs) start trading on the ASX including two
fixed income focused listed investment trusts (LITs), Perpetual Credit
Income Trust (ASX:PCI) and MCP Wholesale Income Opportunities
Trust (ASX:MOT). Refer to our LMI Monthly Update of 18 March 2019
for more details on these LITs.
Pengana Private Equity Trust (ASX:PE1) units listed in April after
it raised $205m, at the lower
The 11% organic growth posted by Transportation & Logistics, the historical heart of Bolloré, is a positive surprise in a context of downgraded world GDP growth.
Putting it simply, we find it difficult to reconcile our 2018 forecasts with the H1 release which is a measure of the group’s complexity. The underlying business is in better shape than expected while building up the stake in Vivendi is a high-wire exercise.
The boss and owner of Bolloré SA is meeting French judges on African corruption allegations. This matters less than a business which is far too complicated for comfort when issues are surfacing from too many corners (Africa, Italy, Batteries).
Bolloré SA fully consolidates Vivendi and has published unappetising earnings.
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Companies: Vertu Motors PLC
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Companies: Whitbread PLC
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