Investing in Europe #40
More Capital Markets Day: Greggs, Infineon, Sika. Deutsche Post - another guidance raise. Logistics related warnings and more
Company news and results
If you live outside the UK you probably haven't heard of Greggs, the bakery chain famous for its sausage rolls. The share price has performed very well over time, as they expanded their stores. This week, Greggs hosted a Capital Markets Day and announced a target to double the turnover over the next five years, to circa £2.4bn in 2026:
Estate growth will be the main growth driver:
Estate growth – we continue to see potential for at least 3,000 UK shops and are challenging ourselves to increase the rate of net shop number growth to 150 shops per year from 2022, of which around 50 per year are expected to be opened in partnership with franchisees…
Followed by evening and delivery:
We see evening daypart sales as a significant opportunity for the business, as we seek to replicate our success in the daytime beyond traditional trading hours…
The opportunity to grow delivery sales reflects the expanding reach of delivery services across the UK combined with the development of our menu. More than 900 of our shops currently service the delivery channel and we expect this to develop to around 80 per cent of the company-managed estate in the years ahead…
Ambu, the MedTech company that focuses on single-use endoscopy solutions, issued a profit warning due to shipping issues:
Sales of Anaesthesia and Patient Monitoring & Diagnostics products held back by shipping issues resulting in full year growth and earnings below financial guidance. Organic growth of the Visualization business is expected to end at approx. 31%
GN Store Nord had similar issues. The manufacturer of hearing aids and headsets, issued a profit warning due to “delays in product development deliverables leading to postponement of key product launches planned for H2 2021”:
The delays result in a revised financial guidance for 2021:
The GN Hearing organic revenue growth guidance for 2021 is revised from more than 25% to around 16%
Due to the lower-than-expected revenue development, the GN Hearing EBITA margin guidance for 2021 is revised from more than 16% to more than 12%
As a consequence of the revised financial guidance for GN Hearing, GN Store Nord revises the financial guidance on growth in EPS from more than 60% to more than 50%
The 2021 financial guidance for GN Audio is unchanged and confirmed.
On the other hand, DHL's owner Deutsche Post pre-released its Q3 numbers and announced they will raise guidance - again:
The positive development of the group's businesses seen in the first half of the year has continued well through the third quarter 2021. Q3 volume trends confirm base assumptions with continued well supported B2B recovery and B2C volumes staying at high previous year levels across all major networks. At the same time the tight capacity situation both in Ocean and Air Freight markets continued.
Infineon, the semiconductor manufacturer, hosted a Capital Markets Day. Some interesting slides there. They are guiding for mid-teens revenue growth and 20% margin in FY22. Capex will increase from €1.6bn this year to 2.4bn.
Sika, the specialty chemical company that supplies to the building sector and motor vehicle industry, hosted a Capital Markets Day:
Sika is seeking to grow by 6%–8% a year in local currencies until 2023. It is aiming for a higher EBIT margin of 15%–18% from 2021 onwards
Yes, it is Capital Markets Day season so here is another one: Verallia, the leading European and third‐largest global producer of glass containers for food and beverages:
Deals and IPO
Naspers-backed Udemy files for Nasdaq IPO (link)
LVMH Acquires Officine Universelle (link)
TUI to raise 1.1 bln euros in equity after summer bookings boost (link)
Geely's Volvo Cars aims to raise $2.9 bln in IPO (link)
IPOs Go From Winners to Losers in Europe as Stock Rout Deepens ($link)
More than 40% of Europe’s initial share sales that raised more than $500 million are now under water, according to data compiled by Bloomberg.
Other news
Amazon opens Britain's first '4-star' non-food store (link)
Nestle expands vegan options with plant-based egg and shrimp substitutes (link) 🤔🦐
EU energy chief says gas price surge has no quick fixes ($link)
A new research note from Michael Mauboussin on “Cash Flow Statement Adjustments to Improve Insight”: