AlphaValue Corporate Services Fundamental Analysis FR
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AlphaValue Corporate Services
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Chargeurs

CR
Bloomberg   CRI FP
Holding Companies  /  France  Web Site   |   Investors Relation
Carrying on with strategic acquisitions
Earnings/sales releases25/04/2017

Surprisingly strong Q1 growth at Protective Films

Fact

Chargeurs SA has released a very strong set of figures for Q1 17 with lfl sales up 5.6% (excluding Luxury Materials, see table below) and pulled by the +10.2% of Protective Films, the key business of the firm.


Analysis

For Q1 sales only releases, the information is only in a summary format but it is clear that the 10.2% lfl growth posted by the Protective Films business is an excellent figure. The group combines better volumes with firming up prices (as would be expected from a cyclical industry) but also seems to benefit from its R&D efforts and ever better mix as a result.

Chargeurs SA is also purchasing two very small companies (combined 2016 turnover of €2.4m, expected to be up strongly in 2017) that supply equipment (“laminators”) improving the productivity of temporary protective films clients. Such equipment will be sold to clients as a solution and improve the overall offer of Chargeurs, presumably creating as well more stickiness (so to say in this industry).

The yoy decline of Fashion Technologies is a non-event to the extent that 2016 saw an excessive proportion of the business booked in Q1. 2017 is better balanced with limited overall growth and a strong focus on bigger fast-fashion clients. Here again Chargeurs is confirming its strategy of standing closer to bigger fashion groups by opening capacity next to their plants (new Ethiopian unit due on stream this year).

Technical substrates is in line while the Luxury Goods turnover surge has no impact on margins.


Impact

These strong Q1 sales figures help back a 7% upgrade to our 2017 EPS forecasts. The issue for the following years is that by 2017 it will have reached peak margins for the last 11 years. More is certainly possible but will presumably depend on successful acquisitions that cannot be discounted at this stage.


Target
Upside 75.3%
Price (€) 17.6
Market Cap (€M) 406
Perf. 1W: -5.38%
Perf. 1M: 4.89%
Perf. 3M: 13.4%
Perf Ytd: 1.85%
10 day relative perf. to stoxx600: -0.62%
20 day relative perf. to stoxx600: 3.75%
Updates

10 Sep 17 Other news/comments
Ship-shape form and growth-minded

20 May 17 Other news/comments
Chargeurs opens its heart

25 Apr 17 Earnings/sales releases
Surprisingly strong Q1 growth at Protective Films

14 Mar 17 Earnings/sales releases
Excellent 2016 delivery, confidence reinforced

31 Jan 17 Earnings/sales releases
Strong 2016 sales and operating delivery

15 Nov 16 Earnings/sales releases
Very solid Q3 revenues indeed

14 Sep 16 Earnings/sales releases
Very convincing first half indeed

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