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Dolfines

CR
Bloomberg   ALDOL FP
Engineering-Heavy Constr.  /  France  Web Site   |   Investors Relation
Acquisitions and new management ensure growth but financing still a headache
Target
Upside 26.4%
Price (€) 0.00
Market Cap (€M) 9.63
Benchmarks Current multiplesWeightValues (€)Upside 
DCF (Edit and simulate)  35%0.00-7%
NAV/SOTP per share   20%0.00229%
EV/Ebitda Peers 13.9 x 20%0.00-28%
P/E Peers 64.5 x 10%0.00-9%
Dividend Yield Peers 0.0% 10%0.00-100%
P/Book Peers 3.0 x 5%0.00-9%
Target Price  100%0.0026% 
Valuation matters
Oil & Gas

We expect 2020 to be the nadir in activity, yet maintain a cautious stance as oil majors continue to exert a strong capital discipline.
We expect the Solutions and Contracting divisions to win c. €400-600k of awards from 2022 to 2024. Dolfines has expertise that can be applied early in the cycle, such as technical refurbishment, yet offshore drilling remains subdued.
The DCF is based on a 4% EBITDA growth for the oil and gas activities.

New Energies

We have decided to isolate the New Energies division and show the sum of its discounted cash flows in 2023. This gives more clarity on the contributions of both the Oil and Gas and New Energies divisions and allows for a more suitable modelling of start-up projects. We expect Dolfines to receive c.50 orders for 15MW floaters, c. 5% of the total market. From 2033 onwards, we have applied a long-term EBITDA and capex growth rate of 9%. Note that, worldwide, floating wind installations are expected to grow by close to 20% CAGR from 2030 to 2040.

Key DCF metrics for selected years

Sum of the parts

Our sum of the parts valuation is based on multiples from comparable companies in each business line. 8.2 France is valued at the transaction price (c. €800k).

We value the Audit & Inspection division (Fatorig) at 8.5× 2023-24 EBIT, vs 15-17x for pure plays in inspection, testing and certification (Bureau Veritas, SGS, Eurofins Scientific), and justified by the cyclicality of the oil and gas sector.

The Services division is value at a multiple of 0.2x to 2023 sales, a 40% discount over its peers specialised in human resources and support services (Randstad, Adecco) and justified by the volatility in activity.

For the Contracting and Services divisions, we have applied a multiple of 5x to 2023 EBIT, using a discount to engineering companies operating in the energy field (Elecnor, Technip Energies) in order to reflect the risks inherent to a smaller company.

For the NAV of the New Energies division, we value the floating offshore wind division using a DCF method as applying a multiple on EBIT or EBITDA would require to select arbitrarily a reference year and therefore be dependent on a still uncertain timing. As a reminder, we use a 8% cost of debt and a 10% WACC.

Comparison Based Valuation
Computed on 18 month forecastsMcap (€M]P/E (x)Ev/Ebitda (x)P/Book (x)Yield(%)
Peers ratios 45.3 8.09 2.11 2.86
Dolfines's ratios 64.5 13.9 3.02 0.00
Premium 30.0% 30.0% 30.0% 0.00%
Default comparison based valuation (€) 0.00 0.00 0.00 0.00
Nordex SE 2,892 95.88.552.750.00
Elecnor 1,770 24.07.451.517.65
DCF Valuation Per Share Help View DCF history
WACC % 9.84
PV of cashflow FY1-FY11 €th 3,626
FY11CF €th 1,563
Normalised long-term growth"g" % 2.00
Sustainability "g" % 1.85
Terminal value €th 19,558
PV terminal value €th 7,649
PV terminal value in % of total... % 67.8
Total PV €th 11,275
Avg net debt (cash) at book v... €th 2,353
Provisions €th 3.34
Unrecognised actuarial losses... €th 0.00
Financial assets at market price €th 0.00
Minorities interests (fair value) €th 0.00
Equity value €th 8,918
Number of shares Th 9,626,...
Implied equity value per share 0.00
Sustainability impact on DCF % -1.59
Assessing The Cost Of Capital Help
Synthetic default risk free rate % 3.50
Target equity risk premium % 5.00
Tax advantage of debt financ... % 25.0
Average debt maturity Year 5
Sector asset beta x 1.16
Debt beta x 1.60
Market capitalisation €th 9,626
Net debt (cash) at book value €th 2,686
Net debt (cash) at market value €th 1,733
Company debt spread bp 800
Marginal Company cost of debt % 11.5
Company beta (leveraged) x 1.31
Company gearing at market v... % 27.9
Company market gearing % 21.8
Required return on geared eq... % 10.1
Cost of debt % 8.63
Cost of ungeared equity % 9.28
WACC % 9.84
DCF Calculation Help
  12/22A 12/23E 12/24E 12/25E Growth 12/26E
Sales €th   7,650 7,817 9,833 14,304 13.0% 16,163   
EBITDA €th   -1,280 -846 413 1,180 13.0% 1,333   
EBITDA Margin %   -16.7 -10.8 4.20 8.25 8.25   
Change in WCR €th   0.00 0.00 0.00 0.00 8.00% 0.00   
Total operating cash flows (pre tax) €th   -1,280 -846 413 1,180 1,333   
Corporate tax €th   0.00 0.00 -11.2 -232 8.00% -251   
Net tax shield €th   -600 -300 -34.1 -34.1 8.00% -36.8   
Capital expenditure €th   -600 -600 -600 -600 8.00% -648   
Capex/Sales %   -7.84 -7.68 -6.10 -4.19 -4.01   
Pre financing costs FCF (for DCF purposes) €th   -2,480 -1,746 -232 313 397   
Various add backs (incl. R&D, etc.) for DCF... €th   24,648   
Free cash flow adjusted €th   -2,480 22,902 -232 313 397   
Discounted free cash flows €th   -2,480 22,902 -211 260 300   
Invested capital   4.96 5.21 5.43 5.63 6.08   
NAV/SOTP Calculation
 % ownedValuation technique Multiple used Valuation at 100%
(€th)
Stake
valuation
(€th)
In currency per share
(€)
% of gross assets
Dietswell New Energies 100% DCF 25,160 25,160 0.00 72.8%
Aegide International 100% EV/EBITDA 10 3,000 3,000 0.00 8.68%
Dietswell Factorig 100% EV/EBIT 8.5 2,980 2,980 0.00 8.63%
8.2 France 100% AlphaValue valuation 1,500 1,500 0.00 4.34%
Dietswell Services 100% EV/Sales 5 1,400 1,400 0.00 4.05%
Dietswell Solutions 100% EV/EBIT 5 500 500 0.00 1.45%
Dietswell Contracting 100% EV/EBIT 5 10.0 10.0 0.00 0.03%
Other
Total gross assets 34,550 0.00 100%
Net cash/(debt) by year end -2,686 0.00 -7.77%
Commitments to pay -150 0.00 -0.44%
Commitments received
NAV/SOTP 31,714 0.00 91.8%
Number of shares net of treasury shares - year end (Th) 9,626,615
NAV/SOTP per share (€) 0.00
Current discount to NAV/SOTP (%) 69.6 View history

Changes to Story : 02/11/2023, Changes to Forecasts : 02/11/2023.