Eurocash 2Q 20 - Covid-19-impacted quarter better than feared
Eurocash delivered a stronger than expected set of 2Q 20 operating results. While the top line was close to our and consensus estimates (+2.4%/-1.0% respectively), operating profitability was significantly better than expected. EBITDA was 25.9% above our estimate and 7.3% above the PAP consensus median, while EBIT outperformance was optically even better (138.9% and 22.8% beat respectively) as the delta to EBITDA forecasts trickled down. The bottom line of PLN 41.1 mn was more than double the consensus estimate of PLN 19.5 mn. We had expected net financial costs of PLN 31 mn vs. the actual result of PLN 19.5 mn (while 1Q 20 delivered PLN 54.3 mn).Eurocash, through its subsidiaries, is engaged in the distribution of food products, household chemicals, alcohol, and tobacco products (fast moving consumer goods). Through a range of distribution formats, Co. and its subsidiaries focus its business activities on the wholesale distribution to customers across the wholesale market segments, in particular, to stores throughout Poland such as retail stores, convenience stores at petrol stations, restaurants, hotels and cafeterias. Co. and its subsidiaries operate a range of distribution formats focused on supplying independent stores in Poland, which primarily include: Cash and Carry, Franchise Systems, and Distribution.
The Institutional Equity Research team of Raiffeisen Bank International AG covers 85 stocks from Austria, Central & Eastern Europe with sell-side research and thus levers our local broker status with excellent company relationships. For corporates in Austria, CEE and Western Europe, we offer co-sponsored research, which includes research coverage and marketing activities to investors. Additionally, through our Spotlight Research product we also shed light on leading European small and micro-caps, seeking greater visibility with investors.
The Institutional Equity Research team consists of roughly 15 analysts, both in Vienna and the CEE countries. Our analysts provide long-standing sector expertise in tandem with profound local market know how and a sectoral approach across the entire region.
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