AlphaValue Corporate Services Fundamental Analysis FR
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AlphaValue Corporate Services
This research has been commissioned and paid for by the company and is deemed to constitute an acceptable minor non-monetary benefit as defined in MiFID II

Dolfines

CR
Bloomberg   ALDOL FP
Engineering-Heavy Constr.  /  France  Web Site   |   Investors Relation
Activity recovers in oil & gas
Target
Upside 28.4%
Price (€) 0.42
Market Cap (€M) 7.96
Debt

Late 2019, Dolfines has signed a financing contract in the form of convertible bonds into shares with share warrants (“OCABSA”) for up to €3m. The funding is made of 19 tranches (the first tranche is of €300k and the 18 remaining of €150k). Our model integrates the financing line of €3m with subsequent share dilution.

On 31/12/2018, Dolfines posted a net debt of €1.2m, with €490k being an interest-free loan from BPIfrance (Banque publique d’investissement) to finance offshore floaters. In Q4 18, the company issued €1m of convertible debt to pre-fund the EOLFLOAT project from ADEME. The remainder is credit cash facilities (€80k) and a loan from CIC (€150k) due in H1 20.

New Energies

More complex is the funding of the New Energies growth plans as they obviously hinge on the choice of business model. We assumed that Dolfines remains in control (full consolidation) of the New Energies ventures and would seek funds by diluting its ownership of an ad hoc SPV through recaps in cash or in kind paying for the initial capex. This dilution is assumed to be such that Dolfines will have received in all c.€25m over an unspecified period of time.
For the Trussfloat business to gain some buoyancy, it will need to spend c. €5m in 2019, which we allow for as extra equity in our funds flows statement coming from minorities. Obviously, the negatives (sharing earnings of the SPV) will not be visible in early P&Ls.

We eventually based our valuation (see ad hoc section) on a scenario where Dolfines shares the New Energies division’s ownership with an industrial partner, keeping a 50% + 1 share in the entity. We chose this approach as we see a partnership (industrial first and financial later on) as key for the future growth of the new floating wind business. The industrial steps of a partnership will back the technical know-how in the field of maritime works (installation, moorings…). Please see Money Making section for more details on the proposed structure.

Funding - Liquidity
  12/20A 12/21E 12/22E 12/23E
EBITDA €th -1,827 -917 -416 -444
Funds from operations (FFO) €th -1,899 -1,105 -603 -631
Ordinary shareholders' equity €th 2,374 1,669 777 843
Gross debt €th 2,461 4,342 3,144 1,946
   o/w Less than 1 year - Gross debt €th 1,198 1,198 174
   o/w 1 to 5 year - Gross debt €th 788 1,472 274 100
   of which Y+2 €th 1,198 174 100
   of which Y+3 €th 174 100 0.00
   of which Y+4 €th 100 0.00 0.00
   of which Y+5 €th 0.00 0.00 0.00
   o/w Beyond 5 years - Gross debt €th 1,673 1,673 1,673 1,673
 + Gross Cash €th 1,439 2,575 474 -656
 = Net debt / (cash) €th 1,023 1,768 2,671 2,602
Other financing €th 2,461 4,342 3,144 1,946
Gearing (at book value) % 79.4 83.6 286 313
Equity/Total asset (%) % 56.5 37.9 17.6 19.1
Adj. Net debt/EBITDA(R) x -0.56 -1.93 -6.42 -5.86
Adjusted Gross Debt/EBITDA(R) x -1.36 -4.94 -8.02 -4.82
Adj. gross debt/(Adj. gross debt+Equity) % 51.2 73.1 81.1 71.8
Ebit cover x -27.0 -6.33 -3.75 -3.98
FFO/Gross Debt % -76.4 -24.4 -18.1 -29.5
FFO/Net debt % -186 -62.5 -22.6 -24.3
FCF/Adj. gross debt (%) % -88.4 -35.5 -27.2 -43.7
(Gross cash+ "cash" FCF+undrawn)/ST debt x 0.81 -0.36 -9.17
"Cash" FCF/ST debt x -1.34 -0.75 -5.37
Credit Risk
Covenants
Changes to Story : 22/12/2021, Changes to Forecasts : 22/12/2021.