Report

Lower profitability incorporated (Drone Volt)

Lower profitability incorporated

TARGET CHANGE

CHANGE IN TARGET PRICE € 0.01 vs 0.02 -36.0%

Our target price has been reduced due to the peer-based metrics having been impacted by a lower EBITDA forecast for 2024 and the lack of net profits until 2026 vs 2025 previously. Moreover, this lower EBITDA generation has reduced our DCF-derived valuation, further reducing the target price. Finally, we incorporate the new capital increase with an oversubscription thesis resulting in 19% dilution.

CHANGE IN DCF € 0.02 vs 0.03 -23.3%

Due to the lower forecasted EBITDA generation in 2024 than we had previously expected, we have reduced our EBITDA forecasts accordingly for the years ahead, especially after the H1 results which showed a lower gross margin on the distribution side especially (7% vs 10% previously). Our FCF for 2024 onwards are affected as we have not modified our growth assumptions for the out years.
Underlying
DRONE VOLT SA

Drone Volt SA. Drone Volt SA is a France-based company principally engaged in the aerospace industry. The Company provides civilian drone manufacturing. It specializes in the production, integration and sale of drones for professionals. Drone Volt is a provider of the audiovisual market in the field of aerial photography by drone. The Company is also present in many other markets such as security and topography, among others. The Company's main product is the Pack PRO FOR GH4 S900. It cooperates with Ministry of Internal Affaires, Ministry of Defense, CERN, Gendarmerie Transports Aeriens (aerial transport police), Dakar 2015, Spie, TF1, Bouygues, CNRS, Bonne Pioche, RAID and GEDEON Programmes, among others. It operates through Dandrone.

Provider
AlphaValue Corporate Services
AlphaValue Corporate Services

AlphaValue Corporate Services capitalise on the research and credit analysis expertise deployed by AlphaValue with major institutional investors at European level over the past nine years. The proprietary tools and processes enabling AlphaValue Corporate Services to establish a valuation and/or a credit risk assessment are identical to those used by AlphaValue to the benefit of its institutional clients. The only difference is the recognition that a company evaluation cannot be dissociated from the fact that the latter is paying for the service (AlphaValue Corporate Services), as opposed to the investor footing the bill (AlphaValue). AlphaValue’s research tools are characterised by the transparency of the valuation methodologies, their responsiveness to market data and by nine years’ experience of a universe numbering more than 450 European companies. Through its coverage and sector exhaustiveness, AlphaValue ranks alongside the major research houses in Europe and constitutes the only new entrant to the European space in the past decade. This significant presence is reflected in an unrivalled distribution capability via platforms commonly adopted by investors to access research: Factset, Bloomberg, Capital IQ and the numerous websites. AlphaValue is one the largest research contributors to these platforms, to the benefit of AlphaValue Corporate Services issuer clients.  The AlphaValue Corporate Services analysts are AlphaValue’s sector specialists. Their robust knowledge of the business models in their sectors enables the rapid generation of incisive, relevant research and advantageous interaction with the management teams.

Analysts
Alexandre DESPREZ

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