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Thales has published robust H1 results. The massive Rafales contract has been recorded and pushed the order intake to a new record, boosting FCF with the downpayments associated with it. The improved guidance is mainly due to FX, and the organic sales midpoint has only improved by 50bp, which is in line with our view. Thales is still committed to bolt-on acquisitions of less than €500m, but does not totally exclude Atos.
Companies: Thales (HO:EPA)Thales SA (HO:PAR)
Thales Q1 figures came as no surprise to the market. Despite the contract wins in space, the commercial traction for the other business divisions has been slow. As it will take time for governments to organize and place orders for Thales solutions, the FY22 guidance remains unchanged, which is a slight disappointment. Although the mid-term fundamentals of Thales remain exceptionally strong, we believe most of the positive dynamic has been already been factored into the stock price.
Thales has reported strong Q4 results, with the order intake at its highest level and strong cash generation. It has resulted in the first share buy-back programme in Thales’ history. The given guidance was a disappointment but does not encompass the major momentum that Defence companies have been witnessing in the current days due to the intensifying Ukraine/Russia war. Though the short-term consequences will be shy on financial figures, the long-term growth of the stock is unquestionable.
Thales has provided solid numbers which were globally in line with consensus. It has confirmed its new guidance (without the Transport division), where it seems well on track to achieve it. Overall, we are still impatiently waiting for an M&A opportunity to see which sector Thales will reinforce.
In 2016, the French group DCNS (currently known as the Naval Group) had won the largest contract in the history of Australia with a value of AUD90bn worth of conventional submarines. After five years of escalating tensions between the Australian government and the Naval Group due to technical issues, the Australian government announced today that it would drop the Naval Group in favour of a new alliance with the US and the UK.
After months of rumours, Thales finally found an acquirer of its Ground Transportation System business: the Japanese company Hitachi. This transaction will be paid in cash and the business will be considered as a discontinued operation for FY21. Therefore, guidance has been re-adjusted.
Thales published a solid set of results for its H1 this morning. All key figures are above consensus: order intake, sales, EBIT and FCF. Its guidance has been improved and the range is now more precise.
The return to growth of Thales is warmly welcomed by investors. The order intake was higher than expectations and proves that a recovery is in place. FY21 is expected to be a great year for Thales, with all sectors improving with time.
Results came in line with expectations, with still good commercial momentum and a major positive surprise concerning cash generation. Guidance points towards a return to growth in 2021, matching expectations. Buy recommendation reiterated.
Thales’ 9M order book and sales figures were in line with the company’s compiled consensus. These results showed a decent qoq improvement in demand, especially in Defence and Space. Going forward, all the 2020 financial objectives confirmed.
Companies: Thales SA
A resilient set of results (in line with consensus), thanks to the diversification of its activity as well as cost-containment measures. A return to normal productivity is expected by this summer, which should help the company to recover in most activities except for civil aero, where visibility on traffic remains low. Still, this should lead to a sharp rebound in both sales and EBIT in the second half of the year.
Thales released its Q1 order book and sales figures, suffering from the early COVID-19 effects, but still within consensus expectations. Most of the impacts are expected in Q2 with various implications depending on the activities and regions. In the longer run, and despite expected disruption for 2020, we expect a certain form of resilience in demand for Thales’ products, which are mainly exposed to Defence and long-term government contracts.
Thales published solid FY19, with positive surprises on both the profitability and cash generation level. Medium-term guidance remains unchanged with an acceleration of growth expected from 2021 onwards. 2020’s guidance is roughly in line with expectations. We maintain a positive view on Thales which we believe has recently discounted several negatives, while the outlook is improving.
Thales has unveiled its order intake for the third quarter after having already done this for its sales. Overall, there were no major surprises despite order intake falling 3% below the consensus average. The company has maintained its FY19 order intake guidance, implying a strong catch-up in Q4, but the company is used to this exercise.
Profit warning issued after delays in contract awards in Defence and the continuous soft market in the Telco Space business. We estimate the impact of the revised guidance to be c. 1% on the group’s sales for 2019, while the EBIT generation and all other long-term guidance are left unchanged. We therefore believe that, putting this into perspective, volatility should remain high on the stock over the coming weeks as investors’ sentiment has been hurt.
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Today’s trading update for H1 22 highlights the difficult operating environment over the first six months of the year, particularly in Q1. Trading picked up in Q2 and is expected to continue to improve in H2 22, in part, due to the inherent seasonality of the business, but also due to some catch up in demand. Guidance is for FY22 post-tax profit to be in line with the consensus estimate of £32.2m, as a result Zeus reduces its estimate by 2.5% to £32.2m. Previous guidance of £3.0m potential impac
Companies: Strix Group PLC
Last week, the UK government published the consultation paper on its Review of Electricity Market Arrangements (REMA). Any change potentially represents uncertainty in a market that has been wary of changes with a number of shares falling after early details of possible reforms were flagged in the press. We review the possible changes and conclude that while there is some risk, from what we can see at present the likely outcomes could be either minimal or beneficial for investors in clean energy
Companies: EQT IES DRX NESF PHE SAE
Companies: Crestchic PLC
Invinity has begun trading shares on the OTCQX Best Market in the USA. We see this as adding liquidity for North American investors and more generally increasing visibility for the company in key markets in North America.
Companies: Invinity Energy Systems PLC
Companies: Flowtech Fluidpower plc
The US Inflation Reduction Act of 2022 now has a chance of passing the Senate next week as it is being voted under the Reconciliation procedure which allows bills related to the budget to pass on a simple majority rather than the 60-vote majority required to overcome a filibuster. If the act does find its way onto the statue books it will bring US$369bn in clean energy tax credits, grants and other incentives. Much is directed to protecting clean energy manufacturing in the USA, but it is a wide
Companies: IES DRX ITM VLS
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Unigel Group, intends to join the Aquis Growth Market. Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a supplier of laminated steel tapes to the fibre optic cable industry in the US. Thixotropic gels and laminated steel tapes are essential components to the rapidly growing global fibre optic cable market. The Group export
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Rolls Royce published mixed figures. Profitability was particularly low, pushing the net result back into the red zone. However, FCF generation was a positive surprise despite the rise in inventory. It has finally found an agreement to sell ITP Aero and will use the resulting cash to repay its only floating interest rate debt.
Companies: Rolls-Royce Holdings plc
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Companies: Open Orphan Plc (ORPH:LON)Renold plc (RNO:LON)
Oil posted the biggest weekly decline since early April on growing signs that a global economic slowdown is curbing demand. Prices are near the lowest level in six months.
West Texas Intermediate settled at $89 a barrel, ending the week nearly 10% lower. US gasoline consumption has dropped, stoking demand concerns, while low liquidity has added to volatility. Supplies from Libya also picked up, helping to shrink key oil futures time-spreads and ease the tightness in the market.
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