23/3- Alpha Bank – TITC & Fourlis: (Results Q4/FY:20 preview)

Alpha Bank – TITC & Fourlis: (Results Q4/FY:20 preview)

Alpha Bank (Results Q4/FY:20 preview): Alpha Bank is set to announce Q4 results today after the session followed by a conference call. Alpha is expected to frontload FY:20 results with provisions and potentially offset the high trading income and positive one-offs expected in the quarter. In more details:

§   NII (-2.3% q-o-q) and commission income (+9.5% q-o-q) are expected to post a resilient performance on the back of lower funding cost and credit expansion. Trading income is expected to reach €320m on GGBs swap and sale of Mastercard unit. Operating costs are seen slightly up (+2.9%) most on seasonal grounds. We see PPI to reach €798m. Alpha Bank is expected to increase provisioning at 48% on domestic loans in order to move forward with another securitization taking on Hercules II guarantee scheme. Thus we see CoR to reach €500m. All in we see a negative after tax result of €44m. On FY:20 basis we expect Alpha to post positive profitability in the tune of €76.6m.

§   In the conference call we expect more color on upcoming NPEs disposals aiming to reach single digit ratio and Galaxy scheduling. Alpha trades 0.17x its TBV and 0.23x post Galaxy securitization.

The following table summarises our Q4:20 estimates:

Alpha Bank

 Act.

Act.

Est.

Latest read

Overview

(In Million Euro)

4Q19

3Q20

4Q20

QoQ

YoY

NII

387.1

381.8

387.0

-2.3%

-0.4%

Fee income

93.1

84.8

84.0

9.5%

-11.2%

Trading

121.1

41.9

320.0

-67.4%

-47.5%

Other Income

6.0

7.0

7.0

Total income

607.4

515.5

798.0

-14.0%

-8.8%

Operating costs

-351.1

-268.5

-272.0

-2.9%

4.1%

Pre-provision-profits

256.4

247.0

526.0

-27.0%

-13.4%

Provisions

-244.8

-168.6

-500.0

35.3%

35.5%

Other results

-6

-2.0

-70.0

46.0%

34.3%

PBT

5.4

76.4

-44.0

3.1%

270.8%

Corporate taxes

-0.1

32.5

10.0

238.9%

103.8%

Net profit (continued)

6

44

-54

-55.0%

841.6%

Discontinued operations

0

0.0

1.0

Net profit

5.5

43.9

-54.0

-55.0%

841.6%

Minorities

-0.1

1.0

2.0

Attributable net profit

5.4

44.9

-52.0

-53.9%

863.1%

Conference Call Details (23/03 17:50)

§   GR: +30 210 94 60 800 or +30 213 009 6000

§   UK: +44 (0) 800 368 1063

§   US: +1 516 447 5632

 

Titan (Q4/FY:20 Results preview): Titan is set to announce FY/Q4:20 results today before the opening. A conference call will follow at 16:00 GR-Time. Consenus expect a soft quarter in terms of turnover (-3.1% y-o-y) on lower US and Balkans activity landing at €388.6m. EBITDA is expected to stay also lower by 4.6% reflecting turnover weakness. Finally, strong FX-gains will boost bottom line posting an increase of 59.6% y-o-y at €9.02m. Dividend is seen at 0.35 eur/share. We expect some fresh outlook regarding geographies in the conference call.

The following table summarise consensus estimates:

ΤΙΤΑΝ

2019

2020 Est.

Y-o-Y

2019

2020 Est.

Y-o-Y

EUR thous.

FY

FY

(%)

Q4

Q4

(%)

Sales

1,609,778

1,591,038

-1.2%

401,231

388,638

-3.1%

EBITDA

267,133

285,425

6.8%

58,718

56,025

-4.6%

EBITDA Mrg

16.6% 

17.9% 

+135 bps 

14.6% 

14.4% 

-22 bps 

Net Income

50,905

67,025

31.7%

5,655

9,025

59.6%

Net Mrg

3.2%

4.2%

+105 bps

1.4%

2.3%

+91 bps

 

Conference Call Details (23/03 16:00 GR-Time)

§   GR: +30 210 94 60 800 or +30 213 009 6000

§   UK: +44 (0) 800 368 1063

§   US: +1 516 447 5632

FOURLIS (Q4/FY:20 preview): The company will report FY:20 results after market close. We expect a weak quarter driven by an extensive lockdown in the company’s network and Greece and poor performance in international markets driven by consumers’ lack of appetite for consumption due to covid fears. Despite electronic sales continuing exceptional performance we note the following:

§   In Greece, where lockdown was in place for c.2months we expect IKEA sales to land 22.9% lower y-o-y to €148.63mn driven by an exceptionally weak Q4 performance (sales down 34% to €35.5mn). IKEA International despite the operation of an additional IKEA store in Bulgaria since September 2020 are seen coming in 18.4% lower y-o-y to €89.4mn with Q4 sales down 31.3% y-o-y to 20.87mn driven by lagging consumer consumption trend. All in IKEA sales are seen retreating 21.4% y-o-y to €238mn.

§   We expect reported IKEA EBITDA at €29.5mn for the FY (-25.7%) on 75bps margin erosion to 12.4% bringing IKEA’s Q4 EBITDA performance to a poor €8.2mn (Q4 EBITDA margin at 14.51%) as hybrid operations (internet only sales/click away/click in shop) hurts both top line performance and operational profitability due to the lack of the ability to take advantage of the state’s introduced covid relief measures (reduced rents, government subsidized employees’ payroll).

§   For the INTERSPORT/TAF segment we forecast FY:20 sales retreat by 25.91% to €121.57mn, with Greece down 16.2% (for the same reasons as in IKEA Greece case) to €74.2mn and international network adding another €47.4mn (-37.28%). Q4:20 will also be weak -44.31% to €23.9mn sales figure.

§   On INTERSPROT/TAF operational profitability front, we see FY:20 segment’s EBITDA at €16.7mn (EBITDA margin at 13.75%, 345bps margin dilution) with Q4:20 EBITDA to just €3.5mn (14.76% EBITDA margin for the quarter) due to the mixed operating framework in Q4 again (which does not allow for full exploitation of the covid financial measures introduced by the state as was the case in the previous lockdown in March to June 2020).

§   Thus consolidated EBITDA is forecasted to launch at €49.28mn with consolidated EBITA margin settling at 13.7%.

§   Net income for FY:20 will be marginally positive to €0.6mn, implying a Q4:20 €3.7mn net income performance.

§   FOURLIS trades at a projected PE/21 34, EV/EBITDA 6.4. We maintain our TP and Recommendation €8.1/share, OVERWEIGHT and will elaborate further after the FY:20 results announcement. We expect covid recovery in 2021 in the retail sector with FOURLIS being one of the highest rated beneficiaries.

The following table summarize our estimates for FOURLIS Q4/FY:20 financial performance:

 

FOURLIS

2019

2020 Est.

Y-o-Y

2019

2020 Est.

Y-o-Y

EUR thous.

FY

FY

(%)

Q4

Q4

(%)

Sales

466,322

359,580

-22.9%

126,922

80,280

-36.7%

EBITDA

66,582

49,280

-26.0%

22,182

15,880

-28.4%

EBITDA Mrg

14.3%

13.7%

-57 bps

17.5%

19.8%

+230 bps

Net Income

11,933

580

-95.1%

5,933

3,680

-38.0%

Net Mrg

2.6%

0.2%

-240 bps

4.7%

4.6%

-9 bps

Conference Call Details (23/03 17:00 GR-Time)

§   GR: +30 210 94 60 800 or +30 213 009 6000

§   UK: +44 (0) 800 368 1063

§   US: +1 516 447 5632