Centrale del Latte d'Italia - Steady performance in a tough environmen...

Centrale del Latte d’Italia (CLI) had a good year in FY18, with total revenue up 1.2% and EBITDA margins up 40bp. The economic and consumer environment in Italy remains challenging. The export business continues to be a standout performer, albeit relatively small. We leave our underlying forecasts unchanged and our fair value remains €3.35 per share.

Centrale del Latte d'Italia - Deteriorating consumer environment

The economic and consumer environment in Italy remained challenging in Q3, and Centrale del Latte d’Italia (CLI) also faced tough comparatives as we start to cycle a full year of price increases. The export business continued to be a stand-out performer, albeit from a low base. We leave our forecasts unchanged, but we note the current headwinds are unlikely to abate in the near future. We expected H2 to be more difficult than H1 as the comparatives got tougher, so we leave our estimates unchan...

Centrale del Latte d'Italia - Steady progress

Despite the continued challenging consumer environment in Italy and across Western Europe during H118, Centrale del Latte d’Italia’s (CLI’s) business continued to perform well, in part due to the price increases implemented during Q217. Vegetable-based drinks and the export business remained stand-out performers, albeit from a low base, and fresh milk also performed well. We leave our FY18 revenue forecasts unchanged, but we adjust our estimates for the sale of the prepared salads plant. O...

Centrale del Latte d'Italia - Solid performance

Despite the challenging economic and political environment in Italy during Q118, Centrale del Latte d’Italia’s (CLI) price increases, implemented mostly during Q217, continued to drive revenue growth. We should see the effect of this subside during Q218 as we start to cycle a full year of price increases. Vegetable-based drinks and the export business continued to witness excellent growth, albeit from a low base. At this early stage, we leave our FY18 forecasts unchanged, and our fair value ...

Centrale del Latte d'Italia - Sales improvement

Centrale del Latte d’Italia’s (CLI) price increases, implemented during H1, continue to drive revenue growth, with total revenue of €187m in FY17 above our forecast of €181m. Newer initiatives, such as vegetable-based drinks and the export business continue to generate good growth. We have raised our revenue forecasts to reflect the higher FY17 base, but trim our EBITDA forecast as the FY17 figure was below our forecast. Now that the CLF business has been owned for a full year, revenue s...

Centrale del Latte d'Italia - Recovery continues

Centrale del Latte d'Italia’s (CLI) price increases – which were successfully implemented during H1 – continue to drive the recovery. Underlying sales growth excluding M&A was an impressive 14% during Q317, and EBITDA margin more than doubled from 2.0% in Q316 to 5.4% in Q317. Revenue synergies continue to feature following the acquisition of CLF, as cross-selling of products across the CLI platform continues to contribute to growth. In October CLI announced that it had signed an agreement with ...

A director bought 50,001 shares at 3.441EUR and

A director at Centrale Del Latte Di Torino bought 50,001 shares at 3.441EUR and the significance rating of the trade was 68/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last...

- Steady

The domestic market remains subdued, and raw material costs have been increasing. Centrale del Latte d’Italia (CLI) implemented some price increases on 1 April in order to offset some cost inflation, with full effect from 1 June. However, spot milk prices are starting to fall, both domestically and across Europe, so we expect a more benign cost environment during H217. We leave our forecasts unchanged and our fair value moves to €2.82 per share (from €2.85).

Integration progressing

The domestic market remains challenging, and raw material prices are now increasing. FY16 revenues were slightly ahead of our forecast and FY17 seems to have got off to a good start. Centrale del Latte d'Italia (CLI) is due to increase its list prices as of 1 April, which should help it offset the cost inflation. The main event of FY16 – the merger between CLT and CLF which gave rise to the new entity CLI – is still being bedded in, and we expect the integration to continue to make progress.

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Integration proceeding to plan

The domestic market remains challenging and beset by deflation, and Centrale del Latte d’Italia’s (CLI’s) flat nine-month revenues led to lower profitability as a result of increased brand support costs. The merger between Centrale del Latte di Torino (CLT) and Centrale del Latte di Firenze, Pistoia e Livorno (CLF) completed as expected on 30 September 2016. The new entity has been formed and is now the third largest dairy/cheese player in Italy. We maintain our forecasts and valuation.

CLI emerges

The merger between Centrale del Latte di Torino (CLT) and Centrale del Latte di Firenze, Pistoia e Livorno (CLF) completed as expected on 30 September 2016. The new entity, Centrale del Latte d’Italia (CLI), has been formed and is now the third largest dairy/cheese player in Italy. Since the two businesses are complementary, it gives scope for synergies as new products can be distributed across both platforms. We maintain our forecasts and valuation, which have taken into account the merger.

Challenging backdrop