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Linde

Second share buy-back announced

Linde plc had announced a $1.0bn share buy-back in mid-December and has now announced a $6.0bn buy-back. Based on the current share price, this represents almost 7% of Linde’s current outstanding number of shares. The transaction will start on 1 May 2019 (or earlier if the previous share buy-back has been finalised before this date) and last until 1 February 2021. Management has decided to pass a large chunk of the proceeds received from forced disposals to shareholders.

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  • 22 Jan 19
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Renault

2018 deliveries were short of our projections

Including the Chinese joint-venture that was set up in 2017 (it operates Jinbei and Huasong light commercial vehicle brands), deliveries amounted to 3.88m, an increase of 3.2% compared to the 2017 number which excluded any joint-venture deliveries. Excluding this volume of 166k LCVs, deliveries fell by 1.2% to 3.72m in 2018. We had expected 3.9m units. This gap of almost 5% or around 180k units is not insignificant. Africa, the Middle East, India was the weak spot last year. Regional deliveries fell by 16% to 449k and, outside France, deliveries fell by 0.6% to 1.23m in Europe (the number was up by 2.4% to 690k in France). Finally, APAC was another weak spot with deliveries down by 16% to 164k when the joint-venture is excluded. Renault experienced some growth of 2% to 748k in Eurasia (i.e. Russia and surrounding countries) and strong growth in LatAm (+12% to 437k). Management sees the volume increasing slightly in 2019, but positive growth is not expected to start in H1.

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  • 18 Jan 19
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Royal Bank Of Scotland Group

The undesired shareholder

The group has confirmed its intention to kill two birds with one stone through the buy-back of shares held by the Treasury. From a shareholders’ standpoint, beyond the positive signal sent, we see limited share price support from the reduction in the State’s stake or of the excess equity.

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  • 18 Jan 19
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Wacker Chemie

Better than expected

Wacker’s FY 18 profitability was negatively impacted by higher raw material prices (Polymers) and lower volumes and sales prices (Polysilicon) accompanied with the re-ramp up costs for the Charleston site. In addition to the difficult business environment, the compensation for the business interruption is still pending. All in all, Wacker’s preliminary figures exceeded our cautious expectations, but more information is needed to have a deeper dive into the figures.

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  • 18 Jan 19
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Casino Guichard Perrachon

Strong Q4 lifts investor confidence

Casino’s Q4 performance is commendable considering the apprehensions about lost sales from Yellow Vest protests in France. However, non-food remains a pain-point and its revival is vital for further margin improvement. We expect the positive momentum to continue in FY19, both in France as well as in Brazil. We reiterate our confidence in the food retailer – management should be able strengthen its omni-channel proposition and also de-leverage the company in the forecast years. No change in our stock recommendation.

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  • 18 Jan 19
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Experian

Robust Q3 FY18/19 performance

The Q3 results came in ahead of our expectations, gaining strength from the robust US performance. Also, the UK provided much-needed support to its topline, led by positive B2B growth and moderating B2C losses. LatAm and EMEA/Asia also remained positive. Moving forward, regulatory risk (dealing with data privacy laws) seems to be the only risk in the US, whereas in the UK, we maintain our cautious stance given Brexit-led uncertainty stretching further. We have revised our estimates upwards. No change in the stock recommendation.

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  • 18 Jan 19
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