We have revised our earnings expectations after incorporating the FY20 figures and rolling forward our estimates through to 2023. The FY21 EPS forecast sees a slight decline due to a more gradual recovery at CFT-PCC, with the fast-fashion market still in a weakened state due to the sanitary and economic crisis. Based on this, the FY21 margin stands at 5.5% versus 6.2% previously. Meanwhile, Protective Films should bounce back to 2019 margin levels by H1 22, and reach 10.0% by 2023, driven by strong pricing and improved mix towards higher-end products.
For Healthcare Solutions, we expect revenues to decline to a normalised level of c.€85m in FY21-22 as the demand for PPE tapers off with no 'shortage scenarios' in sight as the pandemic is brought under control by the current vaccination efforts. With the available offer, pricing should also normalise which leads to a lower recurring operating income margin of 12.7% compared to 20.9% in FY20. CHS is still a remarkable asset that has helped the group leapfrog its diversification ambitions; organic expansion and potential acquisitions in the "Wellness" space should help the division reach €113m in revenues by 2023, with a strong 13.9% recurring operating margin.