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Volume growth back in Q4 as expected SAB released its FY23 numbers which were broadly in line with consensus expectations. Q4 sales (ex IAS-29) increased by c.6.6% at constant perimeter, closing at EUR c63m, likely on DD volume growth and negative pricing (pass-through of lower costs). Reported EBITDA (ex IAS-29) was EUR c8m (+36%) and adj. for start-up costs increased by c42%. Growth was driven by increasing volumes triggering 170bps of reported EBITDA margin expansion (or c280bps adj.) vs las
Companies: Sabaf (SAB:BIT)Sabaf S.p.A. (SAB:MIL)
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OEM outlook hints at stabilising demand this year... Last week, Electrolux (+) and Whirlpool (not covered) released their outlooks for 2024. Changes in Whirlpool''s reporting structure makes its outlook for EMEA (60% of SABAF sales) less relevant. The OEMs expressed a slightly different degree of confidence, though both are more constructive vs 2023. Net-net (see figures 1-2), Whirlpool points to LSD growth (with stronger H2), while ELUX had a more cautious tone, guiding for flat demand. Togeth
With the share having suffered the effects of destocking, we believe SABAF is at a turning point. Volume recovery and normalising profitability should seal 20% net income CAGR and improving momentum support rerating. End of destocking hints at a visible rebound in 2024e-2025e The combined effects of slowing demand and excess inventory make 2023 a tough year for SABAF. That said, our analysis shows that there is room for a rebound in appliance shipments as (temporary) destocking comes to an end.
Lower volumes put pressure on margins in Q1 In Q1, SABAF posted soft start to the year. Sales (at EUR 58.1m) were down by 18% (at constant perimeter -20% vs BNPPe -17%) mirroring mainly a volume decline. We note that the comparison base is tough as Q1 22 was a strong quarter (+9%). Reported EBITDA (at EUR 6.5m) dropped by c.50% with the margin declining by c7pp. Earnings suffered from IAS29 and start-up costs for plants worth c.EUR 0.6m. The gap vs our estimate (of EUR 10.8m) was due to lower vo
Q4 22 results still affected by destocking as expected SABAF''s FY results were broadly in-line with our and cons. estimates. In 4Q 22, sales declined 18% YoY (-22% at constant perimeter) with pricing only partially compensating for volumes (20% down BNPPe) and still significantly impacted by destocking. By region, we note strong outperformance in North America (+30% in FY) where SABAF gained share. EBITDA dropped 33% YoY (vs -26% BNPPe) and the margin came in at c.13% (-310bps YoY) which was up
Lower profitability with declining working capital boosting FCF SABAF posted a weaker than expected PandL but better than expected FCF generation in Q3. Revenues dropped by c.11% in the quarter (vs -17%e) with pricing and FX partially mitigating the effects of declining volumes (c.20% BNPPe). By region, we saw a better-than-expected performance in North America (+17%) and Turkey (-5%). However, profitability in the quarter was lower and this was mainly the result of declining production volumes.
Q3 industry datapoints indicate a tough H2 22... In recent weeks the main large domestic appliance operators (i.e., Electrolux and Whirlpool) have released their Q3 numbers. The message from the earning season was clear, with demand under pressure and cost inflation peaking. Weakness was evident across developed markets, which have worsened sequentially. EU appliance shipments were down -15% YoY in Q3 22 (-10% in Q2), while the US drop was -13% YoY (vs -9% in Q2). ...with demand weakness that is
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
Companies: SAB LUVE FNM IRE MN SES HER AIW IF TIP FNM IRE GHC CEM IGD WIIT COM SAB IF UNIR SCF CEM ILTY MN LUVE IGD TIP HER SES ORS
Better sales in Q2 22 but with softer margins In Q2 22 SABAF reported a mixed set of number with better revenues and softer margins. The company has started to apply IAS-29 in Turkey as the country is hyperinflationary. Net of this IAS effect (not yet included in our Q2 numbers), SABAF reported higher revenue growth (we estimate up in the LSD region) in the quarter with pricing being the main driver. By region, we saw a strong performance in the US coupled with stable EU, more than compensating
Companies: Sabaf S.p.A. (0NIG:LON)Sabaf S.p.A. (SAB:MIL)
Stable volumes in Q1 22 with cost inflation weighing on margins SABAF posted a set of results overall in line with estimates confirming FY22 outlook. In Q1 22 sales closed at EUR70.9m (+9% YoY) with stable YoY volumes (in line with BNPPE) and a slightly higher contribution from pricing. EBITDA of EUR13m (-14% YoY) was in line with our forecast, translating into a c.490bps margin deterioration in the quarter. We remind that the comparison base was challenging as Q1 21 benefitted from lower raw m
4Q21 results impacted by higher energy costs and non-cash FX items In Q4 21 SABAF posted c.5% organic growth with pricing being the main driver of the top-line performance. EBITDA was down c.30% in the quarter and it was the result of tough comparison base (100% YoY growth in 4Q 20) and EUR 2m of energy cost headwind which was not factored in our numbers. However, operating profit is in line with our expectation due to lower DandA. Q4 bottom-line contribution (of EUR 0.6m) was negligible as net
The leading EU supplier of components for major domestic appliances (MDA) is going global, with an eye on consolidating its leadership in the market for gas and hinges and expanding into the profitable, fast-growing electronics segment. Market share gains to drive 75% of 2021-24 MSD top-line growth SABAF is on the verge of becoming a global supplier as it grows in North America and APAC. Share gain in the gas and hinge markets represents more than 75% of our (c.5%) 2021-24 top-line CAGR, impro
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