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Report update on CPH Chemie + Papier Holding AG by Research Dynamics: FY2014 results (News mit Zusatzmaterial)
269 
0 KommentareDGAP-News: Research Dynamics / Schlagwort(e): Research Update
Report update on CPH Chemie + Papier Holding AG by Research Dynamics:
FY2014 results (News mit Zusatzmaterial)
03.03.2015 / 19:10
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Gratifying 2014 results, challenging outlook
FY2014 numbers in line with guidance
CPH's FY2014 results were broadly in line with the expectations set by the
group (guidance given on occasion of 1HFY2014 results), indicating
management's accurate reading of the markets in which it operates. CPH
reported net sales of CHF 492.5mn, a modest rise of 2.3% y/y, as all the
three operating segments posted revenue growth for the first time since
FY2011. Despite price pressures, EBITDA amounted to CHF 50.8mn and
operating profit (EBIT) turned positive and stood at CHF 16mn.
Consequently, EBIT margin for the year returned to black as guided by
management.
Execution of plans yield solid results
CPH reported a healthy set of numbers for FY2014 as the group's key
division - Paper - revenues jumped 2.9% y/y despite a decline in paper
demand (-6.3% in newsprint and -3.2% in magazine papers) due to ongoing
structural changes in the industry. The Chemistry division revenues rose by
1.7%, the first y/y annual growth in the last three years, as shale gas
boom boosted the division's sales. The Packaging division's revenues too
moved northward as demand for its products grew in North and South America.
The group's EBIT margin was positively impacted by a superior operating
performance (y/y) by the Paper division, as the plant was able to operate
the PM4 machine at higher profitability by solely utilizing it for
higher-margin magazine paper. Further, the group saved costs executing its
plans to source a large proportion of recovered paper locally and by moving
to the free electricity market.
A shift to high-growth markets to reduce dependency on Europe
CPH's Packaging division derived a significant 66% of its revenues from
Europe (including Switzerland). However, despite being well positioned in
the region, the group continues to face stagnancy on account of a low
growth rate. To enhance its presence across the globe and enhance sales,
the group has decided to set-up a coating plant in China. CPH has invested
CHF 4.4mn in FY2014 and plans to spend around CHF 20mn towards the China
project. The plant, which is expected to be commissioned in FY2016, will
enable the group to cater to the high-growing Asian market and improve EBIT
margin on the back of low cost base over the medium term.
De-peg of CHF vs. EUR to be a near-term headwind
The Swiss National Bank's sudden decision to scrap the EUR/CHF floor of
1.20 created ripples among the Swiss companies, as the structural change
would negatively impact their revenues and earnings. CPH too would be
impacted as the group derives a significant portion of its revenues from
global markets (ex-Switzerland). Further, with ~70% of expenses being
incurred in Switzerland, cost base remains high. Given the scenario, we
have revised our revenues and EBIT estimates for FY2015 downward.
Attractive entry point at current valuations
Despite the currency headwind, CPH remains attractive on account of its
balanced focus on cyclical and defensive businesses. CPH currently trades
at a P/S multiple of 0.7x (FY2015), which is at a 19% discount to weighted
average of division peers. Given the management's focus on expanding
high-growth markets, we believe a discount to its peers is unwarranted,
despite 2015E being a challenging year. Further, a 20-for-1 split to be
proposed by the management would enhance liquidity of the stock in the
market.
For more information please visit our website: www.researchdynamics.ch/
+++++
Zusatzmaterial zur Meldung:
Dokument: http://n.equitystory.com/c/fncls.ssp?u=ELSAAWODFI
Dokumenttitel: CPH Research Update by Research Dynamics
---------------------------------------------------------------------
03.03.2015 Veröffentlichung einer Corporate News/Finanznachricht,
übermittelt durch DGAP - ein Service der EQS Group AG.
Für den Inhalt der Mitteilung ist der Emittent / Herausgeber
verantwortlich.
Die DGAP Distributionsservices umfassen gesetzliche Meldepflichten,
Corporate News/Finanznachrichten und Pressemitteilungen.
Medienarchiv unter http://www.dgap-medientreff.de und
http://www.dgap.de
---------------------------------------------------------------------
329431 03.03.2015
Gratifying 2014 results, challenging outlook
FY2014 numbers in line with guidance
CPH's FY2014 results were broadly in line with the expectations set by the
group (guidance given on occasion of 1HFY2014 results), indicating
management's accurate reading of the markets in which it operates. CPH
reported net sales of CHF 492.5mn, a modest rise of 2.3% y/y, as all the
three operating segments posted revenue growth for the first time since
FY2011. Despite price pressures, EBITDA amounted to CHF 50.8mn and
operating profit (EBIT) turned positive and stood at CHF 16mn.
Consequently, EBIT margin for the year returned to black as guided by
management.
Execution of plans yield solid results
CPH reported a healthy set of numbers for FY2014 as the group's key
division - Paper - revenues jumped 2.9% y/y despite a decline in paper
demand (-6.3% in newsprint and -3.2% in magazine papers) due to ongoing
structural changes in the industry. The Chemistry division revenues rose by
1.7%, the first y/y annual growth in the last three years, as shale gas
boom boosted the division's sales. The Packaging division's revenues too
moved northward as demand for its products grew in North and South America.
The group's EBIT margin was positively impacted by a superior operating
performance (y/y) by the Paper division, as the plant was able to operate
the PM4 machine at higher profitability by solely utilizing it for
higher-margin magazine paper. Further, the group saved costs executing its
plans to source a large proportion of recovered paper locally and by moving
to the free electricity market.
A shift to high-growth markets to reduce dependency on Europe
CPH's Packaging division derived a significant 66% of its revenues from
Europe (including Switzerland). However, despite being well positioned in
the region, the group continues to face stagnancy on account of a low
growth rate. To enhance its presence across the globe and enhance sales,
the group has decided to set-up a coating plant in China. CPH has invested
CHF 4.4mn in FY2014 and plans to spend around CHF 20mn towards the China
project. The plant, which is expected to be commissioned in FY2016, will
enable the group to cater to the high-growing Asian market and improve EBIT
margin on the back of low cost base over the medium term.
De-peg of CHF vs. EUR to be a near-term headwind
The Swiss National Bank's sudden decision to scrap the EUR/CHF floor of
1.20 created ripples among the Swiss companies, as the structural change
would negatively impact their revenues and earnings. CPH too would be
impacted as the group derives a significant portion of its revenues from
global markets (ex-Switzerland). Further, with ~70% of expenses being
incurred in Switzerland, cost base remains high. Given the scenario, we
have revised our revenues and EBIT estimates for FY2015 downward.
Attractive entry point at current valuations
Despite the currency headwind, CPH remains attractive on account of its
balanced focus on cyclical and defensive businesses. CPH currently trades
at a P/S multiple of 0.7x (FY2015), which is at a 19% discount to weighted
average of division peers. Given the management's focus on expanding
high-growth markets, we believe a discount to its peers is unwarranted,
despite 2015E being a challenging year. Further, a 20-for-1 split to be
proposed by the management would enhance liquidity of the stock in the
market.
For more information please visit our website: www.researchdynamics.ch/
+++++
Zusatzmaterial zur Meldung:
Dokument: http://n.equitystory.com/c/fncls.ssp?u=ELSAAWODFI
Dokumenttitel: CPH Research Update by Research Dynamics
---------------------------------------------------------------------
03.03.2015 Veröffentlichung einer Corporate News/Finanznachricht,
übermittelt durch DGAP - ein Service der EQS Group AG.
Für den Inhalt der Mitteilung ist der Emittent / Herausgeber
verantwortlich.
Die DGAP Distributionsservices umfassen gesetzliche Meldepflichten,
Corporate News/Finanznachrichten und Pressemitteilungen.
Medienarchiv unter http://www.dgap-medientreff.de und
http://www.dgap.de
---------------------------------------------------------------------
329431 03.03.2015
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