LISI - EBIT margin and FCF under pressure in H1 as expected, but better performance expected in H2
Continued and even accelerated organic growth in all 3 divisions.H1 EBIT down 10% due to a 1.4pt contraction in EBIT margin, slightly above our expectations.It is taking time for inflation to be passed on to customers, particularly in the Aerospace division, which lost more than 3pts of EBIT margin.Negative FCF due to the increase in working capital requirement, linked to safety stocks in a complicated supply chain environment and to the rise in trade receivables.Negotiations are still under way to pass on inflation to customers, particularly in the aeronautical industry. These will be necessary to improve EBIT in value termsLISI manufactures multifunctional fasteners and assembly and structural components for three business sectors: aerospace, automotive, and perfurmery. Co.'s activities are also split into three divisions: LISI Aerospace division, LISI Medical division and LISI Automotive division. LISI Aerospace division produces fasteners and assembly components for the aerospace and motor racing markets. LISI Medical division produces medical implants and is a sub-contractor of auxiliary parts. LISI Automotive division produces automotive fasteners and assembly components.
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