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Chargeurs

CR
Bloomberg   CRI FP
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From an industrialist to a luxury player
Target
Upside 7.87%
Price (€) 13.12
Market Cap (€M) 326
Perf. 1W: -0.76%
Perf. 1M: 15.9%
Perf. 3M: 10.1%
Perf Ytd: 12.3%
10 day relative perf. to stoxx600: 0.94%
20 day relative perf. to stoxx600: 14.4%
Earnings/sales releases16/11/2011

Visible slowdown in order inflow for Q4

Fact

For Q3 11, Chargeurs reported a 4% increase yoy in revenues to €132.9m, mainly due to a price effect of +8.3% partly offset by a 4.3% decline in volumes.
For the first 9M, revenues jumped to €423.6m, +10.4%, with volumes up only 0.7%.
The Wool division performed well to €140.1m (33% revenues) which represented a 24.3% increase compared to the same period last year (+18% in Q1 and +27% in H1) driven by the wool price.
The Protective films and Interlining divisions brought weaker top-line growth, with respectively +3.8% and +5.3% vs 7.7% and 8.1% in H1.
For FY 11, despite the lack of visibility on the macro-economic environment, the group guides for revenues to reach €551.1m (+7.6%), operating income to stand at €22.8m (+7%) and the net result to drop to €10m (-22.5% due to higher interest expenses).


Analysis

After a good start to the year, the group was much more cautious for H2 and has been proved right.
Weakening demand will have a huge impact and debt should increase further (c.€8m according to our calculations to €83.24m).
Moreover, doubts remain on the group’s pricing power from Q4 and onwards: higher costs could also threaten the group’s profitability (time lag between cost increases and the rise in selling prices and resistance from customers).


Impact

Downward revision of our EBITDA forecasts for 2011, 2012 and 2013 by respectively -7.7%, -6.8% and -5.9%, to take into account the economic / financial turmoil.


Updates

04 May 12 Other news/comments
Lower volumes will impact profitability

04 May 12 EPS change
A challenging 2012

19 Mar 12 Earnings/sales releases
Increasing profitability in a challenging context

21 Jan 12 Earnings/sales releases
Sales release: in line with our expectations

02 Dec 11 Other news/comments
Eduardo Malone has increased his stake

16 Nov 11 DCF Change
Visible slowdown in demand

16 Nov 11 Earnings/sales releases
Visible slowdown in order inflow for Q4

16 Nov 11 EPS change
Visible slowdown in demand

29 Aug 11 Earnings/sales releases
For H1 11, Chargeurs reported a 13.6% increas...

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