THE TREND
(Boursier.com) — Due to a lack of catalysts, the CAC40 is struggling to get back to 8,200 points. At midday, the index fell 0.13% to 8,169 points after setting a new session high on Thursday at 8,229.25 pts. After the Central Banks in the middle of the week, investors don’t have much to eat this Friday. Good news to report nevertheless from Germany where the business climate improved more than expected in March. Companies’ outlooks became much less pessimistic in March and their assessments of the current business situation also recovered, according to the IFO survey.
The market rally remains fueled by announcements from the Fed, which confirmed on Wednesday that it still plans three rate cuts this year, while the Swiss National Bank is the first of the G10 CBs to reduce its rates in 2024. The Central Bank of Norway and the Bank of England have hinted at a relaxation of their monetary policy in the coming months.
Not much to report also on the corporate side except the resumption of operational functions exercised by Toni Belloni by Stéphane Bianchi at LVMH. The latter will chair the Group’s Executive Committee and, alongside Bernard Arnault, will exercise strategic and operational supervision of the Group’s Houses.
Quoting…
On the oil market, a barrel of Brent fell 0.1% to $85.7 in London. Finally, on the currency front, the euro is losing ground against the dollar, at $1.0818 while Bitcoin is down 2.5% around $65,230 on Coindesk.
RISING VALUES
* Guerbet topped the charts this Friday thanks to a jump of almost 10% to 33.5 euros. The stock is gaining ground after losing ground following the presentation of the 2023 accounts. The global specialist in contrast products and solutions for medical imaging reported an operating profit of €38.7 million, compared to a loss of 18.2 ME a year earlier (the 2022 financial year was marked by significant asset depreciation), for an annual turnover of 785.7 ME, an increase of 4.3%. The increase reached 6.4% at constant exchange rate, excluding an unfavorable currency effect of 15.5 ME largely due to Asian currencies. Free Cash Flow stands at -65.4 ME in 2023; in the second half alone, it was in positive territory at +6.6 ME. For the 2023 financial year, the Board of Directors will propose to the General Meeting of May 24, 2024 the payment of a dividend of 0.50 euros per share, stable over one year. Guerbet confirmed that for 2024 it expects growth in its turnover of more than 8% on a comparable basis and CER and a restated EBITDA margin rate at a level higher than that experienced in 2021 (14.4% ). Finally, Free Cash Flow is expected to be in positive territory for the entire financial year.
* La Française de l’Energie advances 2% to 33.4 euros after losing almost 10% during the last two sessions. The company revealed a half-year EBITDA of €10.8 million, with an EBITDA margin of 62%, beyond the target margin objectives for FY2026, as the Group continued to control its costs, with costs of goods and services stable over the half-year (excluding 979,000 euros of previous ARENH rights which had been retroceded as of December 31, 2022). The Operating Profit amounts to 9 ME, or 52% of turnover. With financial charges, associated in particular with green bonds of 45 ME dedicated to the development of FDE’s low-carbon energy portfolio, and current and deferred taxes of 1.4 ME, the Group’s share of net income comes to 6.3 ME , compared to 10.4 ME as of December 31, 2022. Over this first half of 2024, FDE confirms its ability to generate operational cash flows of 10.5 ME (before variation in WCR of 2.6 ME). In the opinion of the board of directors and management of FDE, the entire activities of FDE are worth significantly more than the current market capitalization. In this context, and under the authorizations currently in place, FDE will relaunch a share buyback program, thus making it possible to increase the intrinsic value per share of FDE securities for the benefit of existing shareholders, without affecting its financing capacity for the development plan for 2026. FDE reiterates its objectives of annualized turnover of more than 100 ME, an EBITDA of more than 50 ME, combined with more than 10 million tonnes of CO2eq emissions avoided per year by 2026.
* Crossroads advances 1.8% to 16.2 euros. Moody’s has affirmed the distributor’s long-term issuer rating at ‘Baa1’. The outlook remains ‘stable’. This confirmation reflects Moody’s expectations that adjusted (gross) debt/EBITDA, which increased to 3.5x in 2023, will decline to 3.0x over the next 12 to 18 months, reflecting the acquisition of 60 Cora hypermarkets and 115 Match supermarkets in France, pre-financed in 2023 and integrated in 2024, and the ramp-up of 129 stores transformed and reopened in Brazil in 2023 following the acquisition of GrupoBIG in 2022. Moody’s also expects FCF and EBITDA margin improve over the next three years as the company realizes cost savings and implements its growth initiatives under its 2026 strategic plan, generates synergies from recent acquisitions and continues to grow organically and through targeted acquisitions in its key geographies.
* Renault (+0.9% to 45.5 euros) and Volvo have obtained the necessary regulatory approvals to officially launch a new company to develop a completely new generation of 100% electric vans based on a Software Defined Vehicle (SDV) architecture, and dedicated services. “The new company will respond to the growing needs for efficient and carbon-free urban logistics and will be based in France,” explains Renault, which plans to invest 300 million euros over the next three years, as Volvo is also committed to doing. Following the non-binding agreement signed on October 6, CMA CGM Groupe confirmed its interest in a strategic investment of up to 120 million euros in Flexis SAS through PULSE, its 1.5 billion investment fund. euros aimed at promoting the decarbonization of the logistics value chain. The new range of 100% electric SDV vans will be presented later by the new company. Production is expected to begin in 2026.
* Bureau Veritas points up slightly by 0.15% to 28 euros despite a favorable rating from Barclays. The British bank has in fact raised its recommendation on the certification specialist to ‘overweight’, targeting 33 euros. Following the CMD which makes it possible to project growth in the sector and the progression of the margin over the long term, Oddo BHF (‘outperform’) for its part is raising its target from 30 to 32 euros. Ultimately, this objective meets Wendel’s convertible strike, a sort of psychological ceiling, underlines the broker.
FALLING VALUES
* Wallix fall of 8.3% to 9.2 euros after widening its losses last year despite record turnover. The group nevertheless explains that it has reached critical size and benefits from a solid base of nearly 3,000 active contracts with significant recurrence of its revenues. This new dimension allows it to enter a new phase of its development combining ‘ramp-up’ and return on investment, with the objective of generating strong, recurring and profitable growth under the effect of a 5-step performance plan points. The 2023 accounts, more heavily in deficit than expected, mainly bear the trace of the accelerated switch to subscription mode and the weight of expenses relating to the overhaul of the commercial organization, underlines TP ICAP Midcap. In terms of outlook, management reaffirms its confidence in the Group’s ability to maintain high growth rates in its recurring revenues and in achieving positive operating income from the second half of 2024.
* LVMH fell 1.7% to 833.6 euros. RBC Capital says the luxury giant’s growth will likely be moderate in the first quarter. The “reality of a quarter with stagnant revenue growth” as well as a sequential slowdown has been “well signaled” for months, the analyst writes, to ‘outperform’ on the record. Nonetheless, the demand environment suggests “limited upside risk” and “few near-term challenges.” LVMH also announced Thursday evening that Antonio Belloni would leave his position as Deputy CEO and Chairman of the Executive Committee in April. After discussions with the Governance and Compensation Committee, Bernard Arnault decided to entrust Stéphane Bianchi with the operational functions carried out by Toni Belloni; consequently, he will chair the Group’s Executive Committee and will exercise, alongside Bernard Arnault, the strategic and operational supervision of the Group’s Houses. He will also supervise the Presidents of the Regions and the Group’s Digital and Data transformation. Toni Belloni retains positions within the Group. He will be responsible for strategic missions with Bernard Arnault and will be named President of LVMH Italy.
* Kering drops another 1.7% to 365 euros, still penalized by its income warning. The luxury group indicated Tuesday evening that current market trends lead it to an estimate of a drop in consolidated turnover of around 10% on a comparable basis in the 1st quarter of 2024. Sales of Gucci, the star brand of the company, are notably expected to decline by around 20% due to a stronger decline than expected in the Asia-Pacific region. Management nevertheless welcomed the success of the Ancora collection prepared by Gucci’s new artistic director, Sabato de Sarno, on sale in certain stores since mid-February.