Greggs’ interim results were heavily affected by the estate closure for the majority of Q220, due to COVID-19. The key takeaways are that operating cash burn during lockdown was in line with management expectations, and current trading, albeit with limited data, indicates gradual weekly progress in revenue, described by management as encouraging. We assume recovery through H121e, before stabilising at a revenue run-rate equivalent to 90% of the level in FY19. The resulting EV/sales multiple of 1.2x for FY21e, is in line with recent multiples. It reflects lower estimated revenue in that year and uncertainty about the rate of recovery.

Greggs Plc

• 04 Aug 20
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Carrefour’s Q2 performance was better than expected. The positive lfl sales momentum in LatAm and Spain was aided by the continued success in cost savings, which is part of the Carrefour 2022 plan. E-com is also moving in the right direction. Moreover, we are optimistic about the performance of the new head of the French operations. We maintain a positive stance on the stock’s valuation.

Carrefour SA

• 30 Jul 20
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Tesco’s share price has declined over the past few weeks, and this is despite announcing strong Q1 results. While FY20/21 is likely to be a tough year (benefits of high sales volume and business rate relief offset by the spike in pandemic related expenses), we reiterate our faith in the business strength of the retailer.

Tesco

• 12 Jul 20
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Colruyt’s performance in H2 FY19/20 was below our expectations, largely due to a soft performance by the retail segment. Perhaps, investors were also spooked by 40bp erosion in the Belgian market share (vs H1 FY19/20). We believe the top line will remain under competitive pressure in the forecast years. The recent improvement in the gross margin is also unlikely to make an impactful contribution to the bottom line, in our opinion.

Colruyt SA

• 17 Jun 20
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Jeronimo’s Q1 performance was in line with our expectations. However, we see some chinks in the armour considering revenue came under pressure in April, especially in the Portuguese retail banner Pingo Doce. The EBITDA margin’s erosion is not a structural issue, however. The reduction of the dividend and withdrawal of FY20 guidance has also added to investors’ discomfort.

Jerónimo Martins SGPS SA

• 15 May 20
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Casino’s top-line performance was strong, akin to other European grocers. While the panic buying is a temporary phenomenon, we note a strong improvement of €67m in the French EBITDA (+190bp yoy, according to our calculation). The retailer is well placed vs close competitors to tackle the ongoing crisis, on the back of a higher reliance on proximity formats and better developed e-com business. We maintain a positive stance on the stock.

Casino, Guichard-Perrachon SA

• 27 Apr 20
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While Casino’s underlying performance was strong, the overall increase in net debt was a sore point. However, French net debt, a pain-point for a long time, witnessed a decline. Casino is also better placed relative to other close competitors on the home turf, largely due to its strategically-placed premium / convenience stores and a strong e-com proposition. We maintain our positive stance on the stock.

Casino, Guichard-Perrachon SA

• 06 Apr 20
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COVID-19 will have an uncertain but important impact on Greggs' profitability in FY20. The profit and cash flow impact of lost sales will be mitigated by internal initiatives and government support on operating costs (rates and employees). The strong balance sheet means that Greggs is well placed for tougher times. Our forecasts are now under review and we are planning to publish a note to update them shortly.

Greggs Plc

• 24 Mar 20
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