LOTUS BAKERIES: A Sharp Cookie: price increases will BEAR fruit LOTB BB
The 13% y/y sales growth in 1H21 continued unabated in 2H21 but 2H21 REBIT margin was below our forecasts. And 2022 looks to be challenging as Lotus Bakeries is faced with unprecedented increases in costs. They are aiming for a price increases for its products to meet its targets for margins and Lotus Bakeries will continue to invest in the growth of its brands.We updated our model and increase our target price slightly to € 5,750 (from € 5,450), in line with our DCF valuation (€ 5,768) as the consistently high growth we saw in FY21 confirms once more that the focused strategy is working and reinforces Lotus Bakeries’ conviction in the international growth ambitions set for both Lotus Biscoff and Lotus Natural Foods. We maintain our Hold rating.
Lotus Bakeries is a bakery group based in Belgium. Co. produces and sells bakery products under the Lotus, Peijnenburg and Annas brand names. Co. focuses on authentic specialties from the biscuit and cake world: original caramelized biscuits (Biscoff), gingerbread, cake specialties, waffles and pepparkakor biscuits. Co. maintains production facilities in Belgium, the Netherlands, France and Sweden. Co. maintains its own sales organizations and cooperates with commercial partners in approximately 10 European countries including the United States, Hong Kong, China, South Korea and Chile.
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