WOOD Flash – CCC: back to the past
CCC has published its long-awaited mid-term strategy for 2020-22E, with the message that, after two years of restructuring, the company is back on track to deliver profitable growth. Besides an in-depth discussion of changes in product procurement, the evolution of the market ecosystem, and rapid changes in clients’ needs and environment, the company also presented detailed 2022E forecasts and its rough guidance for 2020-21E. Management’s guidance implies 2020E sales and EBIT of c.PLN 7.2bn and 4.5%, respectively, spot on our forecasts. However, going forward, CCC assumes a major recovery in margins, driving 2022E net profit of PLN 595-720m, more than 2x higher than our and the consensus expectations. On CCC’s guidance, the stock is trading at a 2022E P/E of 5-6x, strongly below its five-year 3YF average of 16x. We expect a positive market reaction.CCC is engaged in the wholesale and retail trade of clothing and footwear. Co. offers its products to wide range of consumers, from demanding clientele of trendy boutiques to value-oriented medium segment customers, to less wealthy customers seeking reasonably priced quality footwear. Co. pursues a strategy of brand diversification, which is reflected in its three autonomous distribution channels: a chain of official CCC stores, BOTI footwear shops and QUAZI boutiques. Co. offers more than 2,500 designs of footwear. Co. also owns more than 67 proprietary brand names e.g. Lasocki.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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