BNPP Exane View:
Q3 organic growth came in at 6% vs consensus of 4.5%, EBITDA of EUR395m was +1% ahead. Management narrowed the FY organic growth range to 7-8% from 6-8% (implying MSD for Q4 and flagging favourable timing impact in Q3). EBITDA margins expected to be at the bottom end of the 37-38% range. Both are broadly in line with expectations with company consensus at 7.3% organic growth and 37.2% EBITDA margins for the FY. They also revise down the expected tax rate to 22% vs 24% previously. Positioning had been fairly negative into the print so a positive share price reaction is likely (3-5%?), even if the new guide is in line with consensus.
Headline figures
. Q3 sales: EUR1065m, +0.7% vs cons
. Q3 organic growth: +6% vs cons +4.5% (of which price ~1%)
. Q3 adjusted EBITDA: EUR395m, +1.2% vs cons with a margin of 37.1% vs cons 36.9%
Note: All consensus estimates are as per company consensus
Top line drivers
. Q3 Food and Health Biosolutions organic growth +6% vs cons +4.3%
. o.w. Food and Beverage Biosolutions organic growth +5% vs cons +3.3%. Strong growth in dairy incl positive timing impact
. o.w. Human Health Biosolutions organic growth +8% vs cons +7.5%. Growth supported by Alt Proteins and Early Life Nutrition (incl HMO)
. Q3 Planetary Health Biosolutions organic growth +6% vs cons +4.7%
. o.w. Agriculture, Energy and Tech organic growth +7% vs cons +6%. Stronger growth in Energy, supported by Ag but Tech softer.
. o.w. Household Care organic growth +6% vs cons +2.6%. Positive timing effects mitigation impact of end market normalisation
Bottom line drivers
. Q3 Food and Health Biosolutions adjusted EBITDA: EUR162m, -4% vs BNPPEe with a margin of 34.5% vs BNPPEe 36%. Impacted by timing of expenses, increased investment and FX headwinds
. Q3 Planetary Health Biosolutions adjusted EBITDA EUR233m, +4% vs BNPPEe with a margin of 39.2% vs BNPPEe 37.9%. Benefitting from economies and scale, Feed Enzymes Alliance somewhat offset by FX...
