Welcome to a new issue of Investing in Europe, a weekly newsletter on what’s happening in European companies and markets, filtered for what matters. Your feedback is very important, please comment below or DM me on Twitter 🙏
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Weekly performance update
Company news and results
Pernod Ricard upgraded its full-year 2021 (June) guidance. Organic EBIT growth is expected at +16% compared to the +10% guidance released last April.
The pace of recovery is proving stronger than anticipated. The Off-trade continues to be resilient while On-trade demand is accelerating as restrictions are progressively lifted.
Resource management remains dynamic, with strong reinvestment to capture current and future growth opportunities, including A&P at c. 16% of Sales.
Thanks to this dynamism, Pernod Ricard now expects an organic growth in Profit from Recurring Operations for FY21 of c. +16%. As a result, FY21 PRO should, in organic terms, be broadly in line with that of FY19, albeit with Sales still impacted by restrictions in the On-trade and Travel Retail, and Structure costs not yet at their normative levels.
Zalando announced a partnership with LVMH-owned beauty retailer Sephora.
The partnership brings together Zalando’s unparalleled customer experience and deep ecommerce expertise with Sephora’s carefully curated assortment of several thousand exciting beauty products from more than 300 prestige and exclusive brands, beauty expertise and marketing power in prestige beauty.
Cosmetics are a very good fit for e-commerce (27% of L'Oreal sales are online).
Prosus is mostly - 90% ca of NAV - but not only Tencent. The ex-Tecent and Mail.ru ecommerce portfolio grew revenues 54% in 2021, with the Food segment (iFood, Swiggy and Delivery Hero) up 127%. Prosus shared an independent valuation of this portfolio:
For the first time, we are confirming an independent valuation of our Ecommerce portfolio of $39bn. This is almost double the valuation of a year ago and it has delivered an annual return in excess of 20% since 2008.
Prosus discount to NAV is approx 40%.
Other news
Bill Ackman explains why he bought a 10% stake in UMG
Deliveroo defeats another workers’ rights challenge in UK courts (link)
Have a great week and good investing!
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Disclaimer: this newsletter is for informational purposes only and does not represent investment advice. I might have a position in some of the stocks discussed. Always do your own research before investing. Your feedback is important - please contact me on Twitter