23 NOE 2021- FOURLIS (9M:21 results preview)

FOURLIS (9M:21 results preview)

  • The company is set to report Q3/9M:21 financial performance today after market close. We expect a strong recovery across all segments and markets with top line figures approaching Q3:19 levels. In specific:

§  For the IKEA segment we anticipate an acceleration (compared to H1:21) sales to 7.44% (+5.2% in H1:21) driven by reversion in Greek top line performance (+14% in Q3:21 to €53.61mn, +2% in 9M:21 to €115.43mn) and consistency in IKEA International figures (+5% in Q3:21 to €30.1mn, +16.4% in 9M:21 to €79.8mn) bringing total segment to 9M:21 sales of €195.2mn (+7.44% y-o-y sighting though a strong Q3:20 comparable basis) and Q3:21 performance to low double digit growth rate (+10.6% to €83.7mn). E-sales as well as partial further uplifts of mobility restrictions point to this direction.

  • §  On the IKEA margin front we expect mild erosion in 9M:21 gross margin to 40.8% (vs 41.6% a year earlier) same (reported) EBITDA margin dilution (11% from 11.7% a year earlier) bringing 9M:21 gross profit and EBITDA figures to €79.6mn and €21.4mn respectively.

§  On the athletics division segment, we also expect a deceleration in the growth presented in Q2:21 in Q3 citing a strong Q3:20 basis effect, still affected by back to school strong dynamics demand, e-sales channel unified operation and retail sales network rationalization. Thus in Greece we see 9M:21 sales up 13.63% to €67.43mn (+5% in Q3 to €27.83mn) and in SEE we factor in 9M:21 top line growth +40.1% to €53.72mn (Q3:21 +8%) vs +67.4% in H1:21 and +197.4% in Q2:21.

  • §  We see deceleration of gross margin presented in Q2:21 (46.87%) to 43% in Q3 and 43.96% in 9M (44.56% in H1:21) bringing segment’s gross profit figure up 26.8% y-o-y to €53.25mn (9M:21) and +8.9% (€20.15mn) in Q3:21. Reported EBITDA is seen coming in 44.76% stronger in Q3 (€10.3mn) and +80% in 9m:21 (€23.76mn).

§  Overall, on a consolidated basis we forecast 9M figure at €316.33mn, up by 13.24%, Reported EBITDA at €45.17mn (+35.16%0 and 9M:21 net profit reversal to €9.7mn vs loss of €3.1mn a year earlier.

  • §  We are optimistic for a strong finish for the year (Q4:21) in terms of top line performance (aided by weaker comparable basis in Q4:20 amid the lockdown effect for 1.5 months last year ie November and half December) with FY sales projected at €433mn.

§  We maintain an OVERWEIGHT Recommendation of FOURLIS as a means to play Greek economic recovery in 2022.

§  On November 19, the company bought 16.5K shares at €4.03/share for a total consideration of €66.495K. Total treasury at 1,247,137 shares or 2.3941% of share capital.

§  83,574 stock option to executives to be exercised at €3.2226/share (stock option plan 2013) and another 1,766,991 stock options at €5.5637 (unlikely as share price hovers around the €4 area).

§  The following tables summarize our estimates for FOURLIS Q3/9M:21 financial performance:

IKEA (€mn)

Q3 2020 (A)

Q3 2021 EST

  % chng y-o-y

9M 2020 (A)

9M 2021 EST

  % chng y-o-y

IKEA Greece

47.02

53.61

14.00%

113.15

115.43

2.02%

IKEA International

28.65

30.08

5.00%

68.51

79.75

16.40%

Total Sales

75.68

83.69

10.59%

181.66

195.18

7.44%

Gross Profit

31.63

34.48

9.01%

75.50

79.60

5.43%

Gross Profit margin

41.80%

41.20%

-60 bps

41.56%

40.78%

-78 bps

EBITDA (Reported)

12.06

11.72

-2.82%

21.30

21.41

0.52%

EBITDA margin

15.93%

14.00%

-193 bps

11.73%

10.97%

-76 bps

EBIT (Reported)

9.29

8.73

-6.04%

12.80

13.60

6.28%

EBIT margin

12.27%

10.43%

-185 bps

7.05%

6.97%

-8 bps

source: Company, BETA Securities Research estimates

Intersport/TAF (€mn)

Q3 2020 (A)

Q3 2021 EST

  % chng y-o-y

9M 2020 (A)

9M 2021 EST

  % chng y-o-y

Sports Division Greece

26.50

27.83

5.00%

59.34

67.43

13.63%

Sports Division International

17.63

19.04

8.00%

38.35

53.72

40.09%

Total Sales

44.14

46.87

6.20%

97.69

121.15

24.02%

Gross Profit

18.51

20.15

8.87%

42.00

53.25

26.80%

Gross Profit margin

41.95%

43.00%

+105 bps

42.99%

43.96%

+96 bps

EBITDA (Reported)

7.12

10.31

44.76%

13.20

23.76

79.98%

EBITDA margin

16.14%

22.00%

+586 bps

13.51%

19.61%

+610 bps

EBIT (Reported)

2.59

5.31

105.01%

-0.50

10.07

-2113.56%

EBIT margin

5.87%

11.33%

+546 bps

-0.51%

8.31%

+882 bps

source: Company, BETA Securities Research estimates

FOURLIS

2020

2021

Y-o-Y

2020

2021

Y-o-Y

EUR thous.

9M

9M Est.

(%)

Q3

Q3 Est.

(%)

Sales

279,300

316,330

13.3%

119,784

130,656

9.1%

EBITDA

33,400

45,170

35.2%

28,119

31,824

13.2%

EBITDA Mrg

12.0%

14.3%

+232 bps

23.5%

24.4%

+88 bps

Net Income

-3,100

9,720

413.5%

4,148

9,146

120.5%

Net Mrg

-1.1%

3.1%

+418 bps

3.5%

7.0%

+354 bps

  • CC Details: Wednesday November 24, 5pm local GR time

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

§  USA: +1 516 447 5632

§  UK: +44 (0) 800 368 1063

§  INTL & UK: +44 (0) 203 059 5872

Manos Chatzidakis

mchatzidakis@beta.gr