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ALMIRALL: 2Q’20 RESULTS (ANÁLISIS BANCO SABADELL)

2Q'20 vs. 2Q'19 Results
Sales: € 184.7 M (-10.3% vs. -15.7% BS(e) and -8.7% consensus);
EBITDA: € 48.9 M (-43.1% vs. -55.2% BS(e) and -42.8% consensus);
EBIT: € 17.8 M (-66.7% vs. -86.0% BS(e) and -66.5% consensus);
Net Profit: € -6.2 M (€ 32.0 M in 1H'19 vs. € 3.6 M BS(e) and € 12.0 M consensus);
1H'20 vs. 1H'19 Results
Sales: € 426.0 M (-1.0% vs. -3.6% BS(e) and -0.3% consensus);
EBITDA: € 137.2 M (-17.4% vs. -23.7% BS(e) and -17.3% consensus);
EBIT: € 75.3 M (-25.4% vs. -35.6% BS(e) and -25.3% consensus);
Net Profit: € 42.4 M (-31.5% vs. -15.7% BS(e) and -2.1% consensus);

The 2Q’20 Results were in line with the consensus on the operating level but below the guidance’20. The quarter’s EBITDA were in line with the consensus’ estimate (-43% vs. –44% consensus) and above our expectations (–55% BS(e)), with sales very much in line (-9% vs.–10% consensus) although lower in Net Profit (€ -6 M vs. € 12 M consensus) due to a € -17 M deterioration (legacy portfolio in the US) without impact on cash, excluding which, it would have been in line. Good performance of net debt, which was lowered by -4% to € 371 M ex pension plans (~1.3x NFD/EBITDA vs. € 411 M BS(e)). Its 2020 guidance was cut by -11% on average (which the company presented as of YE2019 and was kept unchanged in its 1Q’20 results presentation after Covid-19) to between € 230-250 M of EBITDA (vs. € 260-280 M previously vs. € 231 M BS(e) and € 255 M consensus). We will not change our estimates, but we foresee a negative reaction as the consensus expectations were higher, although limited following its recent performance: -16% vs. IBEX and -17% vs. sector in one month (+4% vs. IBEX since the beginning of the pandemic). BUY. Target Price: € 17.00/sh (upside 70.00%)