FNM: coverage dropped

We have dropped our coverage of FNM owing to internal reorganisation. Our rating, target price and estimates are therefore no longer valid.

The route is well paved

On track with FY guidance In nine months FNM has shown nice progress, with LfL EBITDA growing by c.6% thanks to traffic returning to nearly pre-pandemic levels. We see FNM on to track to meet its FY guidance (in line with current consensus), pointing to low to mid-single digit EBITDA growth and a quicker-than-expected deleveraging this year. Stable regulation makes room for c.10% organic EBITDA growth by 2025e... With no major regulatory changes ahead, FNM looks well positioned to deliver on

A favourable business mix boosts margin; guidance confirmed

A favourable business mix boosts margin FNM posted increasing results in Q2 2023 YoY, substantially in line with our estimates: revenues were up by nearly 0.3% YoY, adj. EBITDA +8.9% (margin at ca. 34% vs. 31% in Q2 2022), EBIT +19.7%, adj. net profit +25.2%. The profit of companies at equity was nearly EUR5.4m, +54.3% YoY. The adj. net financial position reached ca. EUR-762m slightly down vs. ca. EUR-751m as at the end of Q1 2023. The main drivers of the results were: higher traffic YoY (ca. +8

Q1 results bode well for FY guidance

Supportive traffic trends drove Q1 results FNM posted improving results at the EBITDA and net income level in Q1 2023 YoY, in line with our estimates. Revenues were up by nearly 5% YoY, adj. EBITDA +5%, EBIT -9%, adj. net profit +3%. The profit of companies at equity was negative at nearly EUR 6m compared to a loss of ca. EUR 13m in Q1 2022. The adj. net financial position reached ca. EUR -751m slightly down vs. ca. EUR -767m as at the end of 2022. The main drivers of the results were: higher tr

Further growth expected in 2023

Better than expected results. FNM posted a strong set of results in Q4 2022 YoY, ahead of our estimates: revenues were up by nearly 8% YoY, adj. EBITDA +27%, EBIT +19%, adj. net profit +228%. The profit of companies at equity was nearly EUR 22m, it was ca. EUR 19m in Q4 2021. The net debt reached ca. EUR 767m up vs. ca. EUR 739m as at the end of Q3 2022. The main drivers of this positive set of results were an increase in traffic YoY and higher tariffs. The company is proposing EUR 0.023 as a D

Results considerably up. FY guidance within reach

Results considerably up in Q3 2022, bang in line with our estimates FNM posted an improved set of results in Q3 2022 YoY, substantially in line with our estimates: revenues were up by nearly 9% YoY, adj. EBITDA +7%, EBIT +12%, adj. net profit +28%. The profit of companies consolidated using the equity method was negative by nearly EUR 12m, versus positive by ca. EUR 14m in Q3 2021, mainly due to COVID compensations. The net financial position reached ca. EUR 739m down vs. ca. EUR -757m as at the

Strong set of Q2 results

Results strongly up in Q2 2022 on the back of higher volumes, tariffs and efficiencies FNM results saw an increase in Q2 2022 YoY, substantially in line with our estimates: revenues were up by nearly 13% YoY, adj. EBITDA +16%, EBIT +6%, adj. net profit +55%. The profit at equity was positive by nearly EUR3.5m, vs negative ca. EUR15m in Q2 2021. The net financial position reached ca. EUR -757m, down vs. ca. EUR800m as at the end of Q1 2022. The main drivers of this positive set of results were a

Feedback from investor meetings: cyclical fears prevail

Elections confirm polls, with the right-wing coalition winning a majority of seats The Italian elections resulted in the right-wing coalition led by Giorgia Meloni of the Brothers of Italy winning a majority of seats in both lower and upper chambers, though far from the 2/3 needed to change the constitution. The new government will officially start in the week of Oct 10th, and after an initial phase of selecting ministers, it can begin effectively governing from early November. Thus, we may ne

Zeus Building Products and Construction Round-Up - 3 May 2024

Market sentiment turned more cautious in the month of April, particularly regarding interest rates, with economic data producing mixed results. Despite housing transactions and net mortgage approvals continuing an upward trend, with the latter at an 18-month high and +20.1% YoY and +1.4% MoM to 61.3k (seasonally adjusted), Nationwide’s House Price Index dropped 0.4% MoM (seasonally adjusted) in April, below the +0.2% expected. This comes as mortgage lenders nudge rates up to factor in the potent

Hybridan Small Cap Feast - 17 April 24

17th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi

Hardman & Co Healthcare Index: 2023 – Capital demands dent performance

The Hardman & Co Healthcare Index (HHI) has been running since 2009. Its main function is to highlight the attractions of life sciences investments over the long term. For the second year running, apart from global economic influences affecting world markets, performance in 2023 was dented by the capital-intensive nature of the sector. The HHI fell 3.7%, to 483.8, underperforming the main London markets – FTSE 100 (+3.8%) and FTSE All-Share (3.8%) but outperforming the FTSE AIM All-Share Index (

Domino's Pizza - Growing the base

Domino’s Pizza Group’s (DOM’s) new CEO has set an ambitious long-term growth target, including an acceleration in its net store opening programme. With better alignment between the company and its franchisees, management believes DOM should be capable of generating improved profit growth, versus that achieved in recent years, and potential higher returns.

Cornerstone FS+ (CSFS, House Stock at 27p) - Strong close to FY23F, another beat

Cornerstone FS+ (CSFS, House Stock at 30p) - Canada regulatory licence obtained

Vertu Motors (VTU LN) - Market dynamics drive downgrade

An ongoing correction in used car prices has driven lower gross profit per unit for Vertu in recent months and this is expected to continue in the near term. There has been particular weakness in premium vehicle values. Additionally, higher stocking charges on increased new vehicle supply, has led to lower overall profitability. As a result, we have reduced forecast FY24 adjusted PBT by £8.0m (17%) to £39.3m and FY25 by £3.2m (6.2%) to £48.6m. This downgrade to expectations is indicative of mark

Tortilla Mexican Grill - Cracking on

Notwithstanding its sector ‘sweet spot’ (a healthy, customisable product at a competitive price), Tortilla Mexican Grill (Tortilla) has taken the opportunity of a change in management to refine its strategy to address challenges since its successful IPO in 2021 as well as expedite growth. Significant benefit is expected from a new delivery structure to mitigate commission charges in an important part of the business (c 30% of sales), from enhanced marketing to tackle surprisingly low brand aware

Topps Group (TPT LN) - Initiation: Market leader trading at cyclical lows

Topps Group is the UK’s largest specialist supplier and distributor of tiles and associated products to the UK’s domestic and commercial markets. Each of the last three years the Group has successfully achieved record revenue in a market that’s seen recent volume declines and regional peers enter administration. Following the right sizing of its business, Topps Group is now well positioned to capitalise on the economic recovery and continue taking share from competitors, supported by its global

N+1 Singer - Photo-Me International - Growth at inflection point, no need for cold towel in Laundry

Excluding a £2m property disposal gain and £1m restructuring charge adjusted H1 PBT was £31.5m, bang in line with our forecasts (N+1E £31.5m), equating to growth of 2% but -2% YoY on a CER basis given the drags in the UK & Japan (as flagged), which we do not expect to recur helped by strategic, operational and regulatory factors. In Laundry, ARPU and supplier production capacity comfortably exceeds our growth scenario assumptions (see initiation for details). Combined, this underpins our view t

ME Group - Modernising and growing the estate driving growth

During 2023, ME Group commenced the deployment of its next generation photobooths, which are integrated with the group’s newly developed proprietary software, gained market leadership in the Japanese photobooth market with an acquisition, continued to roll out laundry units with existing and new location partners, commenced a share buyback programme and gained entry into the FTSE 250. 2023 was a year of significant strategic and financial progress, with sales up 15%, EPS up 31% and net cash main

Morning Note – 29 April 2024

N+1 Singer - Photo-Me International - Snap it up

PHTM is at an inflection point. We see new technology and rapid expansion in a complementary segment as key factors behind an imminent step-up in profit growth. The stock also provides a substantial level of exposure to recovering European economies, especially France (c45% of PBT). In our view, consensus significantly underestimates these improving profit dynamics and emerging growth in Photo/ID, Laundry & Kiosks. Our base case assumes a 3-yr EPS CAGR of 10% (vs cons c5%) and our analysis sugge

Rapid innovation within very tight parameters

Photo-Me is something of a paradox – although it is a £600m market cap business, it still operates as if it were a nascent entrepreneurial business. It is risk averse and yet highly innovative. Its strength derives from the interaction between three core capabilities - building durable relationships with retail site owners, strong management of technology and product development, and delivery of operational logistics excellence. This note describes the Group’s positioning, and the core investmen

Launch of Irish ID photobooths

Management has announced plans to launch 300 encrypted ID photobooths in partnership with the Irish government. While the agreement will have a negligible impact on our forecasts, this is far outweighed by the strategic value in strengthening the group’s position as a leading operator of integrated security-based applications.