(Boursier.com) — Fnac-Darty widens its losses this weekend with a title that now drops more than 8% to 365.2 euros. The action is weighed down by 2022 results in decline and 2023 forecasts without relief. The distributor reported a net loss of 28 million, against a profit of 160 ME in 2021 for sales of 7.95 billion euros, down 1.9% like-for-like, but growing by + 7% compared to 2019 pro forma. “This performance is part of a context of tensions on purchasing power linked to a high level of inflation which has persisted throughout the year, and after a record year 2021”, specifies the group. Current operating income reached 231 ME after 271 ME in 2021, while the gross margin rate stands at 30.3%, up +80 basis points.
For 2023, the Group expects sales to be down slightly in the 1st half, with a sharp rise in costs, in particular for energy, but should benefit from less unfavorable market conditions in the second half with a level of inflation that could be lower than in the first semester. Overall, Fnac Darty expects current operating income in 2023 to be down around €200 million (but in line or up compared to 2022 excluding the impact of the expected rise in energy costs). This decline should be more pronounced in the 1st half than in the 2nd half, due to a greater weight of fixed costs on the activity and higher energy costs over this part of the year.
Bryan Garnier explains that the EBIT forecast for FY2023 is 10% below consensus and is also ‘loaded’ given a still gloomy consumer environment and an inflationary shock to OPEX which is expected to exceed Fnac Darty’s cost reduction efforts. The broker maintains its ‘neutral’ advice even though it considers a takeover bid from Daniel Kretinsky increasingly likely, as it also foresees shorter-term risks related to a governance conflict between Kretinsky and Ceconomy and to the potential acquisition of Cdiscount.
SocGen lowered its target from 48 to 43 euros while remaining ‘buy’ while TP ICAP Midcap maintains its ‘buy’ recommendation and its target of 54 euros. The essential was not so much in the results of the group already known but rather the rumors of rise in the capital of Daniel Kretinsky, affirms the analyst. The latter expects a complicated first half while consumption remains sluggish. Banque de France figures published this morning indicate a drop of 4.7%
on audio and video equipment and -2.8% on household appliances in January 2023 vs January 2022. However, the broker considers the valuation to be very reasonable and speculation around the stock could restore its appeal to investors.
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