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Research Tree provides access to ongoing research coverage, media content and regulatory news on SWEDISH MATCH AB. We currently have 6 research reports from 1 professional analysts.
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SWEDISH MATCH AB
SWEDISH MATCH AB
Q3: another solid quarter but the stock seems to be fairly valued
28 Oct 16
Swedish Match Q3 update: good quarter with an improvement in the snus & snuff margin. Sales are up +9% in local currencies and +10% on reported figures. The operating margin is up 100bp to 26.5% on the back of good performances in all divisions. By product, Snus & snuff sales were up 2% with the operating margin up 70bp yoy driven by the solid performance in both Scandinavia and US. Cigars and chewing tobacco performed strongly with revenue up +22% and the operating margin up 90bp partially supported by channel loading ahead of FDA regulations. Lights continues its recovery, recording a good +11% in sales and 240bp in the operating margin. Other operations (distribution & corporate overheads) increased by 8%. In September, SWMA reduced its ownership in STG to 18.1% (from 31.1%). Following this event, a special dividend of SEK9.5 will be proposed to the shareholders. No changes to the FY guidance.
Great Q2 driven by snus & cigars; regulatory pressure rises
22 Jul 16
SWMA released its Q2 update. Sales are up +10% in local currencies and +8% on reported figures. The operating margin stood at 25.5% (vs. 26.4% in Q1). By division, sales of snus & snuff were up +7% on constant FX (+5% on reported) with a good 41.6% operating margin. Underlying sales grew in both Scandinavia and the US, however, in Sweden and Norway, SWMA experienced some market share loss. Other tobacco products performed well (+8% on constant FX and +5% on reported figures) driven by cigars (very strong volumes +15%). The company announced that FDA user fees on cigars will be implemented starting from October 2016 (with a $2m impact in Q4). Chewing tobacco sales were down. A positive surprise comes from lights which saw flat sales and a significant improvement in profitability driven by higher volumes in Western Europe and Russia.
Q1: Good start to the year driven by better than expected snus results
04 May 16
SM reported its Q1 results. Sales were up +6% (+7% on an organic basis). The operating profit margin was up +70bp. Results by division: Snus & Snuff sales grew +5% (operating margin was up +260bp) being positively impacted by lower destocking effects (however, SM lost some 0.6% market share in Sweden and -3.8% in Norway). Other tobacco products’ performance was relatively stable (sales up +7%, but the margin was down by 90bp due to weak chewing tobacco and some more intensive competition in cigars). Lights continue to perform poorly (sales -9%, margin down -340bp) on tough comps and the weak Brazilian real. For the rest of the year, the group expects: Scandinavian snus as well as US moist snuff consumption to continue to grow as measured by the number of cans. In Scandinavia, the average net selling price per can is expected to decline slightly versus last year. For cigars, the market is expected to continue growing although competition will remain high.
19 Feb 16
Swedish Match released its FY & Q4 results. In Q4, sales grew organically 2% and +5% on reported figures. Operating profit was down organically by 4% (+1% on reported figures). For the FY, sales grew organically +2% and +9% on a reported basis. The operating profit was down 2% organically (+7% on reported figures). The operating margin contracted by 40bp. The full-year net profit was up +7%. The proposed dividend is SEK20.00 (SEK8.00 of ordinary dividend +SEK12.00 special dividend linked to the partial divestment in STG). Performance by division: - Snus & snuff organic sales were flat in Q4 and +2% for the FY. The operating margin was down 220bp in Q4 and down 340bp for the FY, affected by the weak Norwegian krone and a negative price/mix in Scandinavia. - Cigars and chewing tobacco performed strongly with revenue up +32% in Q4 and +35% for FY. The operating margin was down 150bp in Q4 (higher operating costs) and up 140bp for FY. The segment's performance was positively affected by the absence of tobacco buy-out programme fees, which have now expired. The results of division have been driven by strong cigars (+20% volumes in Q4), whereas chewing tobacco volumes and operating profit in local currencies declined. - Lights performed poorly in Q4 with a decline of 8% in sales and -240bp in the operating margin. On a FY basis, sales were flat and the operating margin contracted by 220bp. The weak performance was linked to the decline in the Brazilian real and lower matches volumes. - Other operations (distribution & corporate overheads) increased by 2.2% for FY. As a reminder, in February 2016, STG was listed on Nasdaq Copenhagen. Following this event, SM now owns 31.2% of STG. No profit was recognised in Q4 as SM is now reporting STG with a lag of one quarter.
Q3 shows some improvement in snus & snuff
04 Nov 15
Swedish Match reported its Q3 results. Sales grew by 10% on reported figures and by 4% in local currencies. The operating profit excluding JV & associates grew by 12% on reported figures and by 4% in local currencies. The operating margin was up 40bp to 26%. Profit for the period increased by 7% to SEK745m. By product, Snus & snuff sales were up 4.3% with the operating margin down by 230bp yoy due to lower margins in Scandinavia and higher costs for the expansion of snus (however, the margin progressed on a qoq basis: 42.4% vs. 40.4% in Q2 15). Cigars and chewing tobacco performed strongly with revenue up +32% whereas the operating margin progressed by 260bp, thanks to an outstanding performance by cigars which more than offset a weakness in chewing tobacco. Lights recorded -2% in sales and -90bp in the operating margin (however the operating margin improved on a qoq basis: 15.1% vs. 11.3% in Q2). Other operations (distribution & corporate overheads) increased by 5%. STG's share of the profit decreased to SEK87m (vs. SEK115m last year) due to the implemented restructuring costs in Q3.
Q2 driven by strong cigars coupled with a positive currency effect
17 Jul 15
Q2 figures: revenue was up by 9% driven by a positive FX effect of 8.6% (in local currencies sales were marginally higher than last year). The operating profit excluding JVs and associates increased by 8.6% whereas the operating margin was down by 10bp. By division, other tobacco products (including cigars and chewing tobacco) recorded an impressive +40.5% in sales (10% in local currency) and +220bp in the operating margin being driven by good local performance in the US, additionally supported by currency tailwinds. Snus and snuff revenue was flat, however the operating margin was down by 400bp yoy being impacted by the lower margin level in Scandinavia. The lights division was impacted by lower volumes to Russia and recorded -510bp in the operating margin. STG's profit contribution increased to SEK126m (vs. SEK92m last year including the asset reassessment).
Panmure Morning Note 01-12-16
01 Dec 16
Consistent with the FY16 trading update/pre-close on September 14, today’s FY16 results are in line with our and consensus underlying PBT expectations of £12.5m (+22.5% YoY). The total FY16 dividend is up 36%, covered 3.4x, whilst net cash is £6.9m (+53%). FY16 represented another good year of execution, and FY17 has started well. The company's business mix is now more diverse across geographies (International accounted for 26% of total sales vs 21% in FY15) and we see CCT’s increasing diversity in retail distribution as both a further risk-mitigation and opportunity driver. We make no changes to our FY17 and FY18 PBT forecasts of £13.5m and £14.5m (albeit, we make some changes to the constituent parts) and introduce a FY19 PBT of £15.5m. We maintain our BUY and TP of 635p.
Strong H2 expected
30 Nov 16
H1 results were in line with expectations with PBT of £9.0m, EPS of 9.9p and DPS of 7.2p. The NAV / share is 253p. We expect the company to have a strong H2 based on its forward sales position and the timing of developments coming through. Telford has a strong balance sheet, a large development pipeline and impressive forward sales position, as well as good levels of demand for its product and geography from a diverse group of buyers. No change to forecasts at this stage.
US$500m to be invested in start-ups by 2026
28 Nov 16
BMW started a venture capital fund in 2011 with an initial investment of $100m. This is now to be expanded to $500m within the next ten years. The fund, called ‘BMW i Ventures’, has been moved from NYC to Mountain View, CA, to have closer access to the technology developed in the Silicon Valley. The investment focus will be on Enabling Technology and Digital Vehicle Technology, Mobility and Digital Services, Customer Experience, and Advanced Production Technology. According to BMW, the fund has closed 15 deals in ‘mobility-related’ technologies so far. It typically acquires a minority stake in start-ups which allows it to gain access to external innovations (so-called ‘outside-in’) that secure the company’s role as a technology pioneer. Simultaneously, it provides support for start-ups by offering internal resources (so-called ‘inside-out’) such as technical expertise and access to its own network of an established car producer.
N+1 Singer - Morning Song 29-11-2016
29 Nov 16
Vp has reported another impressive set of interims, confirming strong growth in most markets and a positive outlook. Recent acquisitions are bedding in well and the full year outturn is set to exceed previous expectations (5%/6% EPS upgrades in FY17/FY18). The recent Capital Markets Day provided a reminder of Vp’s qualities (specialist focus, high returns, strong cash generation) and its growth potential, which in our view are not reflected in a modest <11x P/E rating. We firmly believe the shares are due a re-rating and see intrinsic value in excess of 800p.
Joy of Techs
21 Nov 16
ICT evolution is driven by technological development as advances are made which both meet and shape customer requirements. Our 2011 note No such thing as a telco described the modern reality in that former ‘telcos’ now deliver varying elements of a range of managed services. We built on this theme last year, exploring in further detail their evolutionary paths, operating fundamentals, and cashflow yield similarities. In the consumer environment, demand for bundles of technology is complemented by demand for content. Across the pond, the mooted combination of AT&T and Time Warner typifies the bundled need of ‘pipe’ and content, since unbundled alternatives such as FaceTime and WhatsApp can be easier and clearer to chat over, and Amazon and Netflix are easier to watch anywhere. In the UK, BT’s defensive actions cover delivery, content and capabilities, acquiring EE yet also buying football rights. While TV was long ago added to triple play to become quad play, voice is now merely an app, and fixed and mobile seen as just dumb pipes: it's the content that will influence consumer choices. Growth of TV and film as well as music and gaming over IP leads to UK small cap opportunities. In context of the drive to maximise value from pipes and access by offering content and data, we look at some amongst the potential tech small cap beneficiaries: Amino*, Keyword Studios, ZOO Digital*, 7digital*, KCOM* and CityFibre*.
Small Cap Breakfast
29 Nov 16
Asia Pacific Investment Partner - the research-driven emerging and frontier markets real estate development business intends to float on AIM and conduct a placing in December RM Secured Direct Lending - The secured direct lending fund intends to float on the Main Market on 15 December raising up to £100m Diversified Oil & Gas— Schedule One now out. $60m to be raised. Expected admission 6 December. Creo Medical Group —UK based medical device company focused on surgical endoscopy, a recent development in minimally invasive surgery. Admission due 7 December. Fundraising details TBA.