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Chargeurs

CR
Bloomberg   CRI FP
Support Services  /  France  Web Site   |   Investors Relation
From an industrialist to a luxury player
Target
Upside 33.1%
Price (€) 10.52
Market Cap (€M) 262
Perf. 1W: -11.6%
Perf. 1M: -20.7%
Perf. 3M: -12.0%
Perf Ytd: -9.93%
10 day relative perf. to stoxx600: -18.2%
20 day relative perf. to stoxx600: -18.2%
Target Change15/11/2023

Adjustments to our FY 23-24 outlook

Change in Target Price€ 13.9 vs 17.4-20.2%

Change in EPS2023 : € 0.18 vs 0.39-53.5%
2024 : € 0.60 vs 0.74-19.2%

We have downgraded our EPS estimates for 2023 and 2024. The main factor impacting our revenue estimates is Chargeurs Luxury Fibers, whose sales are expected to decrease significantly vs. 2022 due to a negative price effect (strong drop in the conventional wool price (i.e.: micron 17 down by -30% on Q3 and -21% for 9M 23), and a change in product mix (less conventional and growing certified Nativa wool).

In terms of margins, the main drivers of our downward revision are (i) we had been overly optimistic about Fashion Technologies' margins considering the figures published in H1 23, (ii) we have removed the Healthcare solutions division, which is no longer contributing to Chargeurs' sales and underlying profit, (iii) we have aligned our numbers with the guidance provided by Chargeurs for Museum Studio as we had been a bit too bullish and (iv) as we did not have any information on Swaine, and given the scale-up work that will require opex, we had assumed that Swaine would be consolidated in 2024 and will not contribute to margins.

In 2024, our estimates have been negatively impacted mainly by the downward revision of our estimates for Museum Studio.

Despite these revisions, we remain positive overall especially on CAM, on which we are confident of a rebound, leading to similar margins in absolute terms, despite the fall in our revenue estimates.



Change in NAV€ 28.1 vs 32.2-12.9%

Given that we have based our NAV valuation on EV/EBITDA multiples with an average estimated EBITDA for 2023, 2024 and 2025, the downward revision to our EBITDA forecasts has penalised our NAV estimate. Specifically, consistent with the downward revision of our EBITDA estimates for Chargeurs Fashion Technology, the division's valuation has fallen from €300m to €270m. In addition, we have removed Healthcare solutions, which has also penalised our NAV.



Change in DCF€ 11.8 vs 17.0-30.6%

The sharp fall in our DCF comes from the downward revisions to our FY 23-24 EPS forecasts (see EPS commentary). In 2023, we now expect revenues of €669m (vs. €702m) and an underlying operating profit of €27m (vs. €35m), representing a margin of 4% (vs. 5%). In 2024, we expect revenues of around €753m, compared with €788m previously, and an underlying operating profit of €43m (or a margin of 5.7%), compared with €49m (or a margin of 6.2%).



Updates

30 Apr 24 Earnings/sales releases
Q1-24 Chargeurs kicks off the year in high gear

16 Feb 24 Earnings/sales releases
Operational results in line with the 2023 expect...

15 Nov 23 Target Change
Adjustments to our FY 23-24 outlook

13 Nov 23 Earnings/sales releases
The worst is over as Chargeurs Advanced Mate...

12 Sep 23 Earnings/sales releases
Solace in museums

25 May 23 Earnings/sales releases
Heading for a Chargeurs Advanced Materials re...

13 Mar 23 Earnings/sales releases
Strong 2022 introduces a promising 2023

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