EUR 100.00 For Business Accounts Only

CIE AUTOMOTIVE: 1Q’21 RESULTS (ANÁLISIS BANCO SABADELL)

1Q'21 vs 1Q'20 Results
Sales: € 873.8 M (+6.3% vs. +4.7% expected and +5.2% expected by the market consensus);
EBITDA: € 157.2 M (+12.0% vs. +4.2% expected and +6.2% expected by the market consensus);
EBIT: € 104.3 M (0.0% vs. +3.1% expected and +2.6% expected by the market consensus);
Net Profit: € 78.2 M (+7.7% vs. -5.1% expected and -3.6% expected by the market consensus);
1Q’21 Results came in better than expected in EBITDA (+7.5% vs. BS(e) and +5.5% vs. consensus) and the company raised its 2021 guidance.
Sales fared slightly better than expected, growing +6.3% vs. 1Q’20 (+1.6% vs. BS(e) and +1% vs. consensus; +3.6% in 4Q’20). The market in CIE’s geographic mix grew +8.3% vs. +12.4% of CIE’s sales on the organic level and vs. +10% we assumed in our estimates. The EBITDA margin came in at 18%, +100bps above our estimates and those of the consensus (17.0% BS(e) and consensus), growing +90bps vs. 1Q’20, with a positive performance in all regions. Thus, EBITDA grew +12% vs. 1Q’20 (+7.5% vs. BS(e) and +5.5% vs. consensus) up to € 157.2 M.
NFD came in at € 1.594 Bn (3.48x NFD/EBITDA) vs. € 1.595 in December’20, very much in line with expectations (€ 1.596 Bn BS(e) and € 1.609 Bn consensus) due to working capital (€ -46 M vs. € -40 M BS(e)) and slightly higher capex. The company has announced it has € 1.39 Bn of liquidity reserves (vs. € 1.49 Bn as of Dec 2020), and reiterated the waiver of its financial covenants (without specifying their origin) until 30 Jun 2021.
Lastly, as we have already mentioned, the company has raised its guidance’21. We highlight: (i) medium-high single-digit growth above current market expectations (vs. sales in line with expectations previously), which compares to +14% BS(e) and +12% consensus; (ii) EBITDA margin of >17.5% (vs. >17% previously; 17% BS(e) and 17.1% consensus); and (iii) NFD/EBITDA ratio of between 2.3x and 2.4x (vs. 2.5x previously; 2.7x BS(e) and 2.6x consensus).
In short, these results beat expectations on the operating level, and came with an increased guidance’21, which, on the other hand, would not mean a significant difference on the EBITDA’21 level vs. our estimates and those of the consensus. We expect a slightly positive share price reaction (the stock is rising by +1% vs. +1.2% for IBEX), given that CIE has increased only by +2% YTD, underperforming the IBEX by -7%. There will be a conference call at 15:30 (CET). SELL. Target Price: € 25.60/sh. (upside 13.78%)