reports
Renewi: 1 director
A director at Renewi bought 19,500 shares at 7.735EUR and the significance rating of the trade was 55/100. 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 two years clearly showing...
- Joren Van Aken
Renewi - Hoping for a tender offer
We downgrade from Buy to Hold as in our view management did not deliver on their promises and destroyed shareholder value in recent yearsThe company overpaid on the UK Municipal divestment in our view and the ramp up at ATM is going slower than previously guided. We also expect Renewi to miss its FY28 revenue target by 30%The best outcome for shareholders therefore would be a takeover by either a PE player or strategic acquirer. As hoping for a tender offer is not really the foundation for a sol...
- Joren Van Aken
Renewi - Results slightly below, but ATM & UK more important
Results were slightly below expectations on revenue & EBIT levelUK Municipal to be sold at EUR 154m, a value-destructive price in our viewATM TGG inventory going down slower than expectedReinitiation of dividend at EUR 0.05 p/s, below CSS and DPeOverall we are quite disappointed. We do not believe the EUR 154m is an attractive price and expect investors to be disappointed. We put our rating and TP under review. We also remove Renewi from our Preference List.
- Joren Van Aken
Renewi - FY24 trading update but nothing new on UK Municipal or TGG
• Renewi issued its trading update confirming it “remains on track for announcement by 30 June 2024” for the UK Municipal business. A ‘modest' dividend will be proposed for FY24, as guided at H1• Management confirmed that results would be in line with consensus. We are slightly below consensus currently. No info on progress of TGG sales, which may be disappointing• Overall, the trading update had nothing in it that impacts the investment case of Renewi. Our investment case is based on 1) a ...
- Joren Van Aken
Renewi - Challenging market conditions forcing warning
Market conditions continued to be challenging, especially in the Netherlands which could not be fully offset by mitigating actions Consequently, Renewi warned that FY24 results would be below market expectations. We were already below market expectations. Hence, we expect to change our estimates only modestlyWe maintain our Buy rating, as our investment case is based on the expected actions, which could double profitability
- Fernand de Boer
Preference List 2024 - Divergence to reverse or to continue?
2023 was a year of growing divergence2023 can be characterized as a year that was almost entirely dominated by the CPI question: “Is inflation coming down fast enough to allow the European Central Bank and the Fed to stop raising the rates or even lower them”? Every CPI and employment figure resulted in sharp reactions in share prices. On top came the question whether we entered a recession. There was no clear answer and the expected recovery in China was much softer than expected. Altogether th...
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- Joren Van Aken
Renewi - A potential to double in 4 years
Renewi has been trading at a discount to peers for years and for good reasonsHowever, thanks to the sale of the UK Municipal business and the recovery of ATM, Renewi should be entering a phase of increased profitability (FY28e EBIT margin 8.3% vs. FY23: 6.4%) leading to an improved ROIC profile (FY28e ROIC 11% vs. FY19-FY23 average of 2.4%).Instead of potentially dilutive M&A, we prefer Renewi to focus on improving profitability and productivity of its core business, to use FCF to delever and de...
- Joren Van Aken
Renewi - H1 disappointing but looking positively at H2
H1 Revenue of EUR 937m (-1.6% YoY) was in line with our estimateUnderl. EBITDA EUR 113.6m, 12.1% margin below our estimate of 14.3%Leverage at 2.1x leaving room for some M&AMargin evolution was below expectations. We would expect a negative share price reaction to this print. Our TP remains under review as we delve deeper in the CMD targets announced on October 4
- Joren Van Aken
Renewi - Back to square one: No bid from Macquarie
Macquarie announced that it will not pursue an official bid after multiple attempts to engage with Renewi, including a renewed bid of 815pRevised bid shows little intent of actually wanting to buy the firm.Investors/Analysts will have to go back to the drawing boards and actually try to implement the new information of the CMD which many people deemed to be lacking quite some financial details (e.g. profitability & cash generation).We put our TP under review for the time being as we delve deeper...
- Joren Van Aken
Renewi - CMD Feedback: No Big Shock
Renewi hosted its CMD with the aim to explain its financial targets, with a big focus on the EUR 3bn revenue target in 5 yearsDue to the UK Takeover Code, Renewi was limited in what it could say and hence the CMD was not the ‘fight' that some were hoping forIn our view, the organic revenue targets are definitely manageable. Regarding the other targets (M&A), UK Municipal exit, FCF conversion and ROCE, we have more of a ‘Wait and See' stanceWe do not expect to make major changes to our ...
- Joren Van Aken
Renewi - Potential offer at 775p, small chance of success
Macquarie Asset Management made an all-cash proposal to Renewi at 775p per share (~EUR 8.93 p/s)Renewi's Board immediately rejected the bid stating it significantly undervalues the company and urges its investors to stay putMacquarie is willing to negotiate but seems to try and gain support from the street by making the proposal publicRenewi issued a second press release late last night announcing among others the strategic evaluation of the UK municipal businessWe believe this is a big pos...
- Joren Van Aken
Renewi - Q1 Trading update without surprises
Q1 EBIT lower compared to last year due to lower recyclate prices (no surprise).FY24 results are expected to be in line with market expectations (CSS EUR 1,968m Revenue, EUR 257m EBITDA).Renewi will host a CMD on October 4 to outline the EUR 3bn revenue target in 5 years.No impact on our investment case. TP and Buy reiterated. We continue to focus on end of waste status at M&W, Vlarema 8,TCG inventory offloading and a potential dividend announcement.
- Liberum Research Team
- Liberum Research Team
- Liberum Research Team
- Alex O’Hanlon
- Joe Brent
LIBERUM: Renewi - Many reasons to get excited
The FY 23 results were in line, but we expect FD EPS to fall in FY 24, mainly due to increased interest costs. However, the business’s key attractions remain: 1) There is rising structural demand for Renewi’s services; 2) Renewi is well positioned in advanced circular economies; 3) an exciting M&A pipeline which could accelerate growth; and 4) new targets suggest FD EPS of 197c can be achieved in FY 28, which is 70% ahead of our current FY 26 estimate. In terms of valuation, Renewi trades on a t...
- Liberum Research Team
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JE00BLR94N79 INVINITY ENERGY
- Liberum Research Team
APH ALLIANCE PHARMA PLC
DPH DECHRA PHARMACEUTICALS PLC
RCDO RICARDO PLC
EZJ EASYJET PLC
KIE KIER GROUP PLC
YNGA YOUNG & CO.'S BREWERY PLC A
PETS PETS AT HOME GROUP PLC
LMP LONDONMETRIC PROPERTY PLC
RMG ROYAL MAIL PLC
SPI SPIRE HEALTHCARE GROUP PLC
FEVR FEVERTREE DRINKS PLC
AJB AJ BELL
BYIT BYTES TECHNOLOGY GROUP PLC
JE00BLR94N79 INVINITY ENERGY
- Alex O’Hanlon
- Joe Brent
LIBERUM: Renewi - Recyclate prices have stabilised, EBIT in line
Underlying FY 23 FD EPS fell 8% to 90c, in line with consensus. Core net debt (ex leases) of €371m at FY 23 was in line, and provisions nudged down. Our FY 24 and 25 EBIT estimates unchanged but FD EPS down 9% and 10% respectively due to higher interest; DPS re-instated in FY 24. New targets are introduced which suggest 197c of FD EPS is achievable. We maintain our FY 24 core net debt estimate of €412m. Looking at the three divisions: 1) At Commercial Waste, Renewi seeks to win new customers and...
- Liberum Research Team
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