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Research Tree provides access to ongoing research coverage, media content and regulatory news on Korian. We currently have 11 research reports from 1 professional analysts.
H1 EBITDAR was €401m (+2.0% yoy), broadly in line with expectations. Net profit came in at €38m (+18.8% yoy). Korian confirmed its guidance of 2017 revenue growth above 5%, and the EBITDA margin at around 13.7%.
Q2 revenue increased by 5.1% yoy (organic +2.5%). Korian confirmed its guidance of 2017 revenue growth above 5%, and the EBITDA margin at around 13.7%.
Korian gained almost 6% yesterday following a robust pace in the FY16 results, coming in line with the consensus and the group’s guidance (September 2016). Sales were up 15.8% on a reported basis, fuelled by acquisitions completed by Korian with a strong contribution from the German Casa Reha. EBITDA leaped by 23.5% (EBITDA margin at 14.1% vs 13.3% in 2015) boosted by c.€12m of non-recurring income (EBITDA margin at 13.7%, i.e. +40bp excluding this one-off). Sales grew by 3.8% lfl, reflecting robust performances across the group’s geographies, particularly outside France (47% of group sales, +6.7% lfl), in Germany (+8.4% lfl, reflecting the ramp-up of new facilities opened and acquired in 2015) and Belgium (+9.1%) both benefiting from increased occupancy in mature facilities. Growth in France (+1.3% lfl) was held up by the rehab clinic business, penalised by a regulatory pricing decrease but slightly offset by a steady nursing home segment. Italy (+1.8% in sales lfl) benefited from the portfolio optimisation measures (exit from four non-performing facilities). The opening of 2,744 new beds along with a favourable pricing environment also contributed to Korian’s robust organic performance. The occupancy rate reached 95% in three out of the four geographies. The group’s EBITDAR margin gained 30bp to 26.7%, fuelled by France (+50bp at 27.2%) which benefited from the synergy gains from the Korian-Medica merger and a steady activity. In Germany, the acquisition of Casa is behind the 59.7% rise in EBITDAR, while the EBITDAR margin stood at 27%, experiencing a drop of 80bp in H1 but the strategic efforts (the 2020 Action Plan) led to an upturn in H2. Italy recorded a 23% EBITDAR margin, flat compared to 2015 (impact of the Brescia facility). Promising 2017 targets with growth to accelerate in H2 The group added 2,744 new beds to the network excluding the additional beds stemming from the Casa Reha acquisition (10,182 beds) which brought the total number of beds to c.72k at the end of 2016. At year end, Korian’s portfolio was made up of 715 facilities (vs 621 at end 2015), including 600 retirement homes. The group confirmed its 2017 targets (+5% in sales, EBITDA margin at 13.7%, flat vs 2016 but in line with the 2020 Plan) on the back of the steady pricing environment in the Senior Business, the ramp-up of new facilities opened in 2016 and to be opened in H2 17 (“greenfield”) and the expected growth in the number of beds (c.2,500 beds to be opened in 2017).
Korian lost up to 5% this morning after the announcement yesterday that 13 residents of a 110-room Korian retirement-home passed away (average age of 91.5 years-old), all victims of flu. However, six of the 13 victims had been vaccinated against seasonal flu. Six other residents who are showing flu symptoms are still hospitalised, while a seventh resident has been admitted to hospital as a precautionary measure. The immunisation rate within this residential home is a dramatically low 38% (against an average of 80% in the rest of Korian’s retirement homes and the Ehpad network in 2015). In December 2016, a severe outbreak of flu began in France and there have been numerous alerts sent to the public in recent weeks. The Ministry of Health announced it had opened an investigation. Korian’s reputation under pressure This stands as a hard blow for Korian since it raises questions about the quality of care given by the group’s staff and the possible lack of preventive measures taken by the retirement home (hygienic ones in particular) which is crucial for both clients and the brand’s reputation. It also raises questions about Korian’s capacity to cope with risky situations and, in this case, to manage sick and very contagious residents despite the high degree of vulnerability of Korian’s elderly residents. These dead residents may highlight that the staff were too slow in alerting there was a problem when they should have sent the sick residents to hospital or placed them in quarantine to prevent any contagion risk within the retirement home.
Following the unconvincing H1, Korian released a satisfactory Q3 slightly above consensus. It was marked by an organic growth of 4.1% yoy, while the reported growth reached 15.5%. Revenues year-to-date reached €2,224m, mainly growing in Belgium and Germany. In Germany, revenues grew by 66.3% on a reported basis thanks to the integration of Casa Reha, while Belgium saw the integration of Foyer de Lork making reported revenues rise by 12.9%.
1/ Q1 sales grew by 16.3% reported and 4.1% organic, with France 2.5% reported and 2.1% organic and International +37.1% reported and +7.2% organic. 2/ The company announced an acquisition in Belgium.
FY15 sales were up 16.1% (+3.2% pro forma), EBITDAR increased by 11% (-1.3% pro forma), EBITDA by 8.8% (-4.1%). Operating CF fell slightly (-0.8%). Net financial debt reached €1.6bn at 31/12/2015 including €0.6bn related to real estate. The restated debt ratio represented 3.1x EBITDA, well below its ceiling (4.5x).
FY15 sales were up 16.1% (+3.2% pro forma). The FY15 EBITDA margin is expected to be lower than in FY14 (c. -100bp) due to a stricter definition, by the new management of the group, of some non-current items as well as capitalised expenses and lower than expected operating performance in H2.
The company announced the removal of Yann Coleou with immediate effect and decided « unanimously » to appoint Sophie Boissard, who will arrive on 26 January. Until this date, Christian Chautard, chairman of the board, will assume the role of CEO.
Q3 revenue grew 3.5% (pro-forma). Over the first nine months, growth was 3.1% pro forma, 21% as reported and 2.7% lfl.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Korian. We currently have 11 research reports from 1 professional analysts.
FY results were marginally ahead of July’s trading update, boosted by FX tailwinds and stronger-than-expected gross margins. Revenue growth of 19% was driven by overseas markets (+42%), despite intentional declines in non-ClO2 chemistry-based products. We make only minor changes to our FY 2018 forecasts, with EPS 2% higher than previously forecast and representing c.2% growth (+10% if adjusted for 2017 lower tax charge) during a period of higher investment ahead of the US launch expected in FY 2019. We re-introduce a target price of 275p, underpinned by a DCF analysis, which depends on the timing and success of the company’s entry into the US market.
SCISYS* (SSY): Good heavens (CORP) | Solid State* (SOLI): Half-year update signals shift in business mix (CORP) | Petra Diamonds (PDL): Q1 trading update (BUY) | ANGLE* (AGL): New application for Parsortix harvesting cells from bone marrow (CORP) | Omega Diagnostics* (ODX): Half-year trading update (CORP) | Real Good Food* (RGD): Significant reduction in guidance (CORP) | Firestone Diamonds (FDI): Q1 trading update (U/R) | Trakm8* (TRAK): H1 is on Trak (CORP)
Companies: SSY SOLI PDL AGL ODX RGD FDI TRAK
We upgrade our sector stance to POSITIVE, as the next 9 months is due to be a strong period for UK life science company news, with multiple significant trial readouts expected, companies generally well-funded and many of the headwinds seen in previous quarters easing.
Companies: ABC AMS AGY ANCR BTG C4XD CTH CSRT DPH DNL EKF FARN HZD HCM IMM MXCT MTPH PLI SCLP VEC VLG VER
Tristel* (TSTL): FY 2017 results – RoW now dominates (CORP) | Capital Drilling* (CAPD): Q3 trading update, on track for FY forecasts (CORP) | Europa Oil & Gas* (EOG): Holmwood planning update (CORP)
Companies: TSTL CAPD EOG
Anpario’s interim results highlighted a period of impressive growth with exceptionally strong performances from key target regions Asia, the Americas and Middle East. The group’s transformation of sales and distribution channels is still in its early stages and we expect the group to continue its strong growth over our forecast horizon (12% 3-year CAGR). We upgrade our Target Price from 354p to 432p. We note the strong share price performance (+52% since our initiation in Feb) and move to Hold.
Full-year adjusted EPS was 7% above our expectations, driven by higher revenues, gross margins and a lower tax charge. FY 2018 is a year of transition; the need to replace revenues from the loss of its second-largest licence income stream (c.£1.0m) with existing product growth and the introduction of troponin by Siemens. We reintroduce a target price of 2,600p implying 2018 P/E of 30x falling to 26x for 2019. Despite an 11% decline in EPS in FY 2018 as it transitions the licence loss, the shares should be underpinned by free cash flow (+11%), which supports a 3.5% yield, 3.4% free cash flow yield, 46% free cash flow/capital employed and 56% ROCE. Bioventix remains a top quartile investment in the finnCap Slide Rule.
Dialight (DIA LN) Production issues at Sanmina | Ergomed (ERGO LN) Positive top line PeproStat™ Phase II data | First Derivatives (FDP LN) Kx selected to power AI solution for healthcare sector
Companies: DIA ERGO FDP
Totally (TLY) - Sch 1 for £11m RTO of Vocare, a provider of integrated urgent care services to the NHS throughout the UK. £76.8 million rev in the year ended 31 March 2017. Totally to address Care Quality Commission concerns. Due 24 Oct. Central Asia Metals (CAML) -RTO of Lynx Resources. Anticipated market capitalisation at Admission: £404.8m. Raising £113m at 230p. Acquiring the SASA zinc-lead mine in Macedonia from Solway Industries. Due 15 Dec. 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. Orogen plc, to be renamed Sosandar plc on Admission. Sosander is an online womenswear brand specifically targeted at a generation of women who have graduated from younger online and high street brands, and are looking for affordable clothing with a premium, trend-led aesthetic. Offer to raise £5.3m with market cap of £16.1m, expected 2 November 2017 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 late October .
Companies: PPC BMK HCM IHC KCR DOTD STI TIDE
Since its inception in 2010, the Panmure Gordon Conviction List has outperformed the market, returning 278% against a Small Companies index that would have returned 232% over the same period. Our Q4 portfolio reflects our view that the UK equity market stands to benefit from a coordinated upturn in global growth. Low nominal fixed income spreads continue to provide a valuation underpin for global equities. There are increasing signs that the world’s central bankers are making a concerted effort to wean markets off near zero interest rates. However with global debt exceeding 200% of GDP and unfavorable demographic trends, we think their chances of rapid progress are slim.
Companies: CPI CTH CINE JE MJW NOG RPC VM/ XAR
President Energy* (PPC): Placing and open offer (CORP) | Allergy Therapeutics (AGY): Focus on pre-R&D EBIT growth (BUY) | Boot (Henry) (BOOT): Materially head of expectations (BUY)
Companies: PPC AGY BOOT
Ergomed has announced positive top line data from its Phase II trial of PeproStat™. The liquid haemostat met the primary efficacy endpoint of superiority over standard of care in time to haemostatis across all surgery types tested. PeproStat™ offers a differentiated approach to current products in the haemostat market in that it is manufactured from blood-free components and formulated in a ready-to-use solution. Ergomed now intends to undertake a Phase III trial evaluating PeproStat™ in an enlarged group of patients. We reiterate our highly positive stance and upgrade our intrinsic value to 376p per share (from 355p).
Dechra Pharmaceuticals (DPH LN) AGM statement confirms all in line | IQE (IQE LN) Unexpected historic US tax bill | PCI-PAL (PCIP LN) Continuing compliance with PCI DSS and new contract win | Renold (RNO LN) Forecasts trimmed to reflect H1 update | SDL (SDL LN) CMD highlights: Technology key to long term competitive advantage
Companies: IQE RNO SDL DPH PCIP
Augean (AUG LN) Board changes and reduction in expectations | First Derivatives (FDP LN) Agreement with European Space Agency | Futura Medical (FUM LN) Market research supports the commercial potential of Eroxon® | Low & Bonar (LWB LN) Civil Engineering struggling | Sinclair Pharma (SPH LN) Forecast update; profitability inflection and strong growth ahead
Companies: AUG SPH LWB FUM FDP
Data presented at the World Conference on Lung Cancer (WCLC) on combination approaches to treat resistant EGFR-driven non-small cell lung cancer (NSCLC) highlight a widening of the patient population that could be eligible to receive savolitinib in combination with either Tagrisso or Iressa. Partner AZN now has the data set to make a decision on global Phase III trials and evaluate breakthrough therapy designation (BTD) potential in both 2L and 3L EGFR-resistant NSCLC; in our view, data to date supports both. BTD could offer earlier entry into the US market. Furthermore, Phase II data presented on fruquintinib in combination with Iressa (first line EGFRm NSCLC) showed encouraging efficacy and acceptable safety. We place our forecasts and valuation under review as we revisit our peak sales assumptions.
Companies: Hutchison China Meditech
Totally (TLY) - Sch 1 for £11m RTO of Vocare, a provider of integrated urgent care services to the NHS throughout the UK. . £76.8 million rev in the year ended 31 March 2017. Totally to address Care Quality Commission concerns. Due 24 Oct. | Central Asia Metals (CAML) -RTO of Lynx Resources. Anticipated market capitalisation at Admission: £404.8m. Raising £113m at 230p. Acquiring the SASA zinc-lead mine in Macedonia from Solway Industries. Due 15 Dec. | Springfield Properties—Scottish housebuilder. “Our turnover exceeded £100 million for the first time this year and now we employ around 500 people. This IPO is the next step in our growth.” Expected Mid October. Offer TBA. | 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. | Orogen plc, to be renamed Sosandar plc on Admission. Sosander is an online womenswear brand specifically targeted at a generation of women who have graduated from younger online and high street brands, and are looking for affordable clothing with a premium, trend-led aesthetic. Offer to raise £5.3m with market cap of £16.1m, expected 2 November 2017 | 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 late october | SolGold—Publication of prospectus regarding transfer from AIM. Due 6 Oct | ContourGlobal LP— contracted wholesale power generation businesses, with 69 thermal and renewable power generation assets in Europe, Latin America and Africa. In the year ended 31 December 2016 it generated $905.2 million of combined revenue and $440.4 million of Adjusted EBITDA. Raising c.$400m. Expected November. | TI Fluid Systems—Maybe second time lucky? Pulled last October. global manufacturer of automotive fluid storage, carrying and delivery systems seeking to raise €425m to reduce financial leverage (to approximately 2.0x net debt to Adjusted EBITDA by the end of FY 2017). Possible partial sale by Bain. Revenue for FY 2016 was €3.3 billion and Adjusted EBIT was €362.1 million | M7 Multi-Let REIT—Intends to raise up to £300m at 100p. Aims to acquire and hold a portfolio of UK regional light industrial and regional office assets diversified by geography, asset type and tenants that is expected to generate stable income returns and, where appropriate, offer the potential to leverage and enhance returns through active asset management initiatives. Due 13 Nov. | Bakkavor Group - Provider of fresh prepared food intends to float in November. FY 16 Revenue: £1,763.6 million FY 16 Adjusted EBITDA: £146.4 million (13.7% CAGR FY 14-FY 16). Part vendor sale and primary raise of c. £100m. Price TBA. | Russia’s En+, owned by Russian aluminium tycoon Oleg Deripaska, has assets in metals and energy, including hydropower. reported to be seeking dual London and Moscow listing raising $1.5bn | TMF Group , which provides tax, admin and legal support services, reported to be seeking London IPO to raise c. £200m | People’s Investment Trust—Objective of sustainable wealth creation. Also to list on the Social Stock Exchange. Targeting £125m raise on 17 Oct. No performance fees or executive bonuses in order to focus on long term rather than short term performance.
Companies: DKE WDC FLO XLM NKTN APQ GEO POLR AEG BSE