Asseco Poland: Nice dividend...but in the price
We keep ACP as a NEUTRAL but lift our FV to PLN 59.90 (from PLN 50.9) thanks to 13%/4% upgrades to 19E/20E NI estimates from faster than expected growth of Formula Systems and Asseco Int. Recently announced 3Q19 results showed that ACP’s backlog was 14% higher YoY driven by Formula Systems +21% YoY, Asseco International +15% YoY and Asseco Poland at -10% YoY driven mostly by the high base of 2018 (banking upgrades) and reduction of the scale of the hardware business (Asseco Data Systems). ACP has shown very good momentum in healthcare winning ca. 32% of total tenders YTD worth PLN 57m. With solid cash flow, OpCF at PLN 791m in 9M19 (vs PLN 482m in 9M18) and not materially higher invCF at PLN -421m in 9M19 (vs PLN -306m in 9M18), we expect Asseco to maintain its hefty dividend with a DPS of PLN 3, implying DY 5.0%.Asseco Poland is a provider of proprietary information technology ("IT") solutions which is based in Poland. Co. is engaged in provision of consulting on IT infrastructure, security solutions, human resources solutions, outsourcing services as well as fully comprehensive IT support. Co.'s profile includes software and computer hardware consultancy, production of software as well as supply of software and hardware. This category includes analysing, developing, and programming ready-to-use IT systems. In addition to IT services, Co. also sells goods including mainly computer hardware.
Haitong is the first international Chinese investment bank and our goal is to be the primary channel for capital flows into and out of China. During 2015 the Senior Management Team in London was expanded significantly to focus on this objective and to provide a full-service cross-asset markets business coupled with sector-focused investment banking. We work closely with our world-wide network of offices to bring a true depth of understanding to all client situations.
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