IBERIAN DAILY 26 FEBRUARY + 4Q’23 RESULTS. HIGHLIGHTS AND REST OF PREVIEWS (ANÁLISIS BANCO SABADELL)
NEWS SUMMARY: CAF, CIE AUTOMOTIVE, IBERDROLA, MAPFRE, SANTANDER, TELEFÓNICA.At the end of today’s report, and during the entire results season, we will include a presentation with positive and negative results highlights and previews for the 4Q’23 results to be released over the coming days in Spain.
Results drove stock markets to highs
With the exception of the FTSE 100, European stock markets ended the week with gains, and many of the main global indices hit new record highs, thanks in part to the solid results released. In the STOXX 600, Chemicals, Autos and Consumer Goods led the gains (around +3.0%, whereas Basic Materials fell more than -2.0%. On the macro side, in Germany the IFO rose slightly in February, in line with expectations. Meanwhile, the latest ECB survey showed a slight rise in 12M consumer inflation expectations. From the ECB, J. Nagel (Bundesbank) was in favour of delaying any rate cuts until the second half of the year and waiting to see 2Q’24 data. In US business results, Warner Bros came in below expectations and Berkshire Hathaway better.
What we expect for today
European stock markets would open with profit taking, falling around -0.3%. Currently, S&P futures are down -0.10% (the S&P 500 ended -0.12% lower vs. the European closing bell). Asian stock markets are mixed (China’s CSI 300 -0.93%, Japan’s Nikkei +0.35).
Today in the US we will learn January’s new home sales and February’s Dallas Fed index. In US business results, Domino’s Pizza and ONEOK, among others, will release their earnings.
COMPANY NEWS
CIE AUTOMOTIVE, BUY
The results are slightly below expectations in sales, but better than we expected in margins (+150bps vs. 2022 to 18.0% vs. 17.2% BS(e)), and thus EBITDA has grown +13% over the full year (vs. +8% BS(e)). Sales € 3.86 Bn (+3.1% vs. +4.0% BS(e)), EBITDA € 713.2 M (+12.6% vs. +8.2% BS(e)), Net Profit € 320.2 M (+6.7% vs. +2.5% BS(e)).
By regions, we highlight the strong sales performance in North America (+14%), and on the negative side China (-19%), in line with what was seen in 9M’23.
The company has confirmed its long-term targets (2025): (i) sales growth of around +20pp above the market (+41% total in 2020-25e, vs. +41% BS(e) and +51% consensus) and (ii) an EBITDA margin target above 19% (vs. 18.2% BS(e) and 18.3% consensus).
Banco Santander is a holding company, providing a range of financial products. Co.'s products and services include: retail banking business that covers all customer banking businesses; wholesale banking business; as well as asset management and insurance business. Co.'s principal operations are in Spain, the U.K., Portugal, Germany, Italy and Latin America. As of Dec 31 2014, Co.'s total assets amounted to Euro1,266,296,000,000 and total customer deposits amounted to Euro647,627,000,000.
CIE Automotive is the parent company of an industrial group formed by several companies that are engaged in the design, manufacture and sale of automobile component and sub-units on the world market. In addition, Co. is also engaged in the bio-fuels business which is in the initial stages of development and is made up of various companies devoted to the production and distribution of bio-fuels.
Iberdrola is a holding company. Through its subsidiaries, Co. operates in four segments: network business, which includes all the energy transmission and distribution activities, and other regulated activity originated in Spain, the U.K., the U.S. and Brazil; deregulated business, which includes electricity generation and sales businesses as well as gas trading and storage businesses carried on by Co. in Spain, Portugal, the U.K. and North America; renewable business, with activities related to renewable energies in Spain, the U.K., the U.S. and the rest of the world; and other businesses, including the engineering and construction businesses and the non-power businesses.
Mapfre is an insurance company based in Spain. Co. is the parent company of a group engaged in the underwriting and provision of insurance in Spain and abroad. Insurance policies provided include: life, non-life, accident, home-owner, general and health. Through its subsidiaries, Co. is also engaged in the provision of reinsurance, the management of investment funds, pension funds and pension plans, real estate and related services. On the domestic market, Co.'s activities include managing investment funds, pension funds and pension plans, real estate and other service businesses.
Telefonica is engaged in the provision of public or private telecommunications services, including ancillary or complementary telecommunications services or related services. Co.'s fixed business includes: traditional fixed telecommunication services, Internet and broadband multimedia services, data and business-aplications services, and wholesale services for telecommunication operators. Co. also provides a range of mobile and related services and products to consumer and business customers, including mobile voice services, value added services, mobile data and Internet services, wholesale services, corporate services, roaming, fixed wireless, and, trunking and paging.
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