(Boursier.com) — Results poorly received for Saint Gobain which now drops almost 5% to 67.9 euros, at the bottom of the CAC40. The construction materials giant generated a net profit of 2.67 billion euros last year, down 11.1%, for a turnover of 47.94 billion euros, down by 6.4% (-0.9% like-for-like despite a difficult environment in new construction in Europe). The operating margin reached a new record to stand at 11.0% (compared to 10.4% in 2022), an increase of 330 basis points since the launch of the Group’s transformation at the end of 2018. Despite a difficult macroeconomic environment, all Regions showed an increase in operating margin, further proof of the Group’s resilience.
For the 2024 outlook, despite a context that remains difficult in certain markets, the group is targeting a double-digit operating margin for the fourth consecutive year.
“I am confident that 2024 will be another year of success for Saint-Gobain, thanks to good momentum in the high-growth American, Asian and emerging markets, and also thanks to the good integration of our recent acquisitions, particularly in the construction chemistry. In Western Europe, renovation will continue to resist, while new construction will remain difficult but will gradually reach, country by country, a low point in a market which remains structurally healthy given construction needs. In this context, we are targeting a double-digit operating margin in 2024, for the fourth consecutive year,” says Benoit Bazin, Managing Director of Saint-Gobain.
Oddo BHF (‘outperform’) remains generally convinced that the changes of recent years have not yet been integrated at their fair value (green deal, sustainable ESG profile, strong pricing power, change in the group’s profile via acquisitions and new emblematic disposals) . At less than 6.0x in 2024 EV/EBITDA, Saint-Gobain presents significant catch-up potential compared to its peers. Citi (‘buy’) says FY2023 results and FY2024 margin guidance are broadly in line with expectations. Prices continue to deteriorate, but the decline in volumes has moderated. Morgan Stanley (‘overweight’) says cash flow is a ‘healthy’ positive surprise, while working capital is strong. “More qualitative than quantitative” perspectives which already seem to be reflected in the consensus, even if Morgan Stanley sees higher margins.