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Cost control and lower LLPs led to better bottom line in Q2 22
IFIS posted another solid quarter delivering on the BP execution, despite the macro getting tougher. In Q2 22 net income was EUR 38m, 18% ahead vs our estimate of EUR 32m. NII came in line, while trading and other revenues compensated for lower-than-expected fees. LLPs were a touch better, with the main surprise coming from operating costs being the main driver of the bottom-line beat. CET-1 closed at 14.9% vs 15.7% in Q1 22. We note
Companies: Banca IFIS (IF:BIT)Banca IFIS S.p.A. (IF:MIL)
BNP Paribas Exane - Sponsored Research
Underlying trends were solid in Q1 22
IFIS reported a stronger than expected bottom line in the quarter with EUR 35m net income (+74% YoY) vs BNPPE at EUR 27m. The beat came from net revenues with trading gains from the property portfolio (of EUR 8m) being the main driver of the surprise. NII trend was solid with the bank outperforming the market both in factoring turnover growth and new leasing volumes. Below the top line, both LLP and Opex were in line with our forecasts. On cost of risk, we
The Italian leader in unsecured NPLs is ready to benefit from both the next wave of disposals and a growing factoring market. A leaner and more digital organisation should help in expanding returns, while stronger capital boosts the visibility on shareholder remuneration.
A solid positioning built on specialised SMEs lending and NPL investing
IFIS has built its solid positioning focusing on profitable niches targeting SMEs'' needs, while being a specialised investor in NPLs. The bank is the l
IFIS is generating balance sheet growth across many businesses including core trade receivable financing (with initiatives in pharmaceuticals and multi-utilities) and distressed retail loans. Despite this growth, capital ratios remain exemplary. In 2016 and beyond, this loan growth should
deliver underlying, sustainable profit growth. Credit remains excellent. Our forecast 2016 PBT and EPS are largely unchanged.
Companies: Banca IFIS S.p.A.
The group’s strategy to replace bond profits with flows from sustainable business operations continues to be delivered, broadly speaking. Strong growth in the core trade receivables business and in the distressed loans operation meant the group net profit from financial activities fell just €2m to €57m (Q315 vs Q314) despite a €13m reduction in bond portfolio contribution. The bond portfolio contributed less than 10% of group’s net profit from financial activities (Q314 33%). Costs were well con
The key development in Q215 was the already announced crystallisation of the bond portfolio profits, generating a pre-tax gain of €124m. This realised gain is now in regulatory capital. The core business continued to show good growth, especially in the distressed loans and tax receivables units (revenue growth was 9%), and credit quality remained excellent. Further investment has been made to grow existing and new business lines.
In the past week Banca IFIS has made two announcements that reinforce confidence in our expected profit growth. On 23 June it announced the acquisition of three NPL portfolios with a total nominal value of €883m, increasing the number of customers by c 100k (to 900k). On 17 June it announced an expansion into the niche pharmacy market. IFIS has strong capital and liquidity and can exploit market opportunities to grow.
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The group posted a strong set of results showing faster and stronger-than-expected net interest margin expansion and no signs of a deterioration and above all anxiety on the asset quality front. It remains to be seen if the UK government will allow banks to hold on to the benefit of interest rate increases and if the UK economy proves as resilient as expected.
Companies: Lloyds Banking Group plc
Revolution Beauty has announced a downgrade to the outlook for FY23 driven by retailer challenges and the unprecedented macroeconomic backdrop. It has confirmed it will now report FY22 results on 30 August 2022.
Companies: Revolution Beauty 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
Cenkos:Duke Royalty Ltd -Record revenues keep on rolling
Companies: Duke Royalty Limited
Management’s reluctance to commit to precise short-term guidance signals that the strong first-half operating performance cannot be taken for granted. The return to a sustainable decent profitability level (above 10%) remains a distant objective as reminded by the management itself.
Companies: Barclays PLC
Companies: Renewables Infrastructure Group (TRIG:LON)Oakley Capital Investments Limited (OCI:LON)
Market performance washed over Liontrust and was the primary detractor as AuM fell by 11% organically (+2% incl. Majedie completion). There were net outflows (£541m) which are never ideal, but exploring this further we see that these are distributed across products/channels, making them relatively near-negligible despite prevailing caution. The AuM outturn was lower than our £35.7bn estimate, driving a 5-6% reduction to our earnings estimates. We think the current 8x PER is pricing in “worst cas
Companies: Liontrust Asset Management PLC
Singer Capital Markets
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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
Companies: SDI FUL PURP OSI IXI BSE BRSD ATM
A year on from the end of lockdown on July 19 2021, celebrations at the UK's economic bounce-back in H2-21 have long lost their fizz. Two intertwined themes have remained salient / gathered pace over the past six months since our mid-year sector review: exchange rates and inflation. As we write today, press speculation is focussing on the possibility of a 0.5% rise in UK interest rates in August, billed as the biggest move in 27 years. Looking further afield, economists are looking to the F
Companies: FOUR JIM JIM CODE PEN PTD WATR SPSY
NESF has boosted its effective electricity price hedging with the winning of 86W under the UK’s CfD renewable support scheme. This provides an index-linked 15-year income stream providing a strong underpinning to the fund’s earnings.
Companies: NextEnergy Solar Fund Ltd
Purplebricks full year results provides the detail behind its May pre-close update (i.e. 40,141 instructions; £70m revenue; £8.8m EBITDA loss and £43.2m cash) and details Purplebricks’ plan to return to operational cash generation.
Companies: Purplebricks Group Plc
This quarter’s key observations
• Subsector performance: Marketplaces was by far the best performing subsector from an aggregate share price perspective (up 19.9%) vs. an average –5.2% for the other five subsectors. UK Digital Media was the worst performing subsector with a -12.4% aggregate share price move.
• Valuation trends: UK Managed Services saw the largest EV/ EBITDA derating (-2.1x) and is now on the lowest EV/Sales multiple (1.5x FY1) and second lowest average EV/EBITDA (11.3x FY1
Companies: CNIC BIG DEVO LBG OTMP SYS
Trident Royalties Plc (AIM: TRR) has, this morning, provided an update on its activities undertaken during the quarter ended 30 June 2022. Most of the elements of the update had already been announced in another busy quarter for the company as management finessed existing contracts. Momentum remains powerful with a 155% QoQ (15x YoY) increase in net revenue to $5.7m. The contributory components of this were varied with Koolyanobbing comfortably ahead of our forecasts whilst the gold offtake port
Companies: Trident Royalties Plc
Enclosed is our weekly round-up of news and updates from the professional services sector.
Companies: Personal Group Holdings Plc
The global provider of cloud-based secure payment solutions for business communications has given a positive post-YE update for FY22. We had expected a good year after the strong interims, but sales rose a stunning +60% yoy, while TACV and ARR at YE both jumped c.40% yoy. The financials will beat current market expectations, leading us to upgrade our forecast revenue by 3% and reduce our forecast Adj. LBT by 7%. Cashflow seems to have been particularly positive, with YE net cash £0.7m ahead of e
Companies: PCI-PAL PLC