Thursday, June 25, 2020
¢ Market Comment
Stocks in Athens ended lower, in line with Europe’s losses as an uptick in the number of COVID-19 cases all over the world has dented sentiment. Concerns about a second wave of the coronavirus in the Northern Hemisphere and downwardly revised global economic forecasts for this year dampened the mood further at Athinon Avenue. General index ended at 665.01 points, shedding 1.63% from Tuesday’s 676.04 points. The large-cap FTSE 25 index contracted 1.52% to 1,609.61 points.
The banks index dropped 2.68%, as National parted with 4.27%, Alpha fell 3.07%, Piraeus gave up 2.77% and Eurobank eased 1.15%. Motor Oil dived 5.69%, Ellaktor slumped 5.21%, Mytilineos conceded 4.37%, GEK Terna slid 2.66%, Lamda Development lost 2.11% and Viohalco shrank 2.02%. Sarantis grew 2.20% and Jumbo increased 1.94% In total 31 stocks posted gains, 62 endured losses and 22 remained unchanged. Turnover amounted to €49.4m just shy from Tuesday’s €50m.
Market starts lower possibly testing strength levels at 650 points, international trend is a key factor for reversal during the day.
¢ In the Spotlight
Greece/GDP: Finance Minister Staikouras said he expects a 16% recession in the second quarter, bringing the annual economic contraction to up 8%. In an interview with local Athens based radio station, Staikouras said that Greece’s cash buffer has reached €37.5bn higher than mid-March figure, due to the country’s two successful exits to debt markets and higher Treasury-bills auctions. He added that there will be no other foray into bond markets for the June-July period. He also reassured that the country will not face cash problem “even if there will be a second wave (of pandemic resurgence)”.
Alpha Bank: Alpha Bank is reportedly nearing completion of the sale of €1.8bn portfolio of secured non-performing corporate loans to debt purchaser Fortress. Press reports said that the signing of the deal is expected in the next 10 days. Alpha Bank has declared Fortress as the preferred bidder for the so-called Neptune portfolio last December, but the pandemic outbreak led the two parties to revise the initial terms. Also, Fortress will reportedly pay the cost of the portfolio in instalments.
Lamda Development: During AGM yesterday, CEO Mr Athanasiou projected construction works commencement in Helliniko plot by end 2020 and listing of Lamda Malls subsidiary (managing The Mall Athens, Golden Hall Mall and Mediterranean Cosmos Mall) on the ASE in 2021.
PPC: During AGM CEO Mr Stasis reiterated the company’s target for FY’20 EBITDA in excess of €700mn and above €1bn in 2024. He also mentioned target of 1GW installed RES production by 2024 and personnel reduction to 11,500 employees.
OTE: On June 23, the company bought 52,183 shares at €12.6080/share for a total consideration of €657.923K. OTE now controls 4,092,481 own shares or 0.87% of its share capital. AGM cleared FY’19 gross dividend distribution €0.55/share. Dividend ex-date July 9. Dividend payment July 15.
NEWSPHONE: Mandatory tender offer (pending approval by HCMC) for the 44.93% (12,510,898 shares) of the company that basic shareholders (currently commanding 55.07% and acting in common) do not control at €0.47/share.
TRASTOR REIC: As of today, the trading of the right of the company ceases following the recent share capital increase carried out in the form of a rights issue. The expiration date of the pre-emption right’s subscription period is set on June 29, 2020.
MOH: AGM cleared 5mn shares buyback at a price range €8-€18/share up to May 2022.
Hellenic Petroleum: Shares trade ex FY 2019 remaining dividend €0.25/share on June 29. Payment on July 6.
AUTOHELLAS: AGM on July 15. Dividend ex-date July 22. Dividend payment July 28.
Titan (Trading update 5M:20): Rather unexpectedly, the group announced yesterday a 5 month period trading update, providing colour across geographical segments as a follow up to Q1:20 results which also had some information regarding the course of the year (4M:20) and the impact of Covid-19 to its core business operations. 5M period sales came in at €641.8m (-2.1% y-o-y) on stronger East Med and solid US performance, while EBITDA was shaped at €97.3m, (+5.5% y-o-y) on lower energy costs. Group net profit decreased by 9.5% at €3.5m impacted by higher financial costs (€30.6 vs. €25.5m a year ago). In more details:
§ Activity in the USA saw a strong start to the year and in Q1, positive market trends and favorable weather conditions led to a 6.2% Revenue growth compared to 2019. Operations continued uninterruptedly with a moderate slowdown of demand in Florida and the Mid-Atlantic recorded since mid-March. The effect of lockdown measures was more pronounced on import terminal which supplies the New York Metro area during April, followed by a recovery of sales volumes since the beginning of May. Overall, May 2020 year-to-date Revenue and EBITDA in the USA were close to the performance of the same period last year, with Revenue at €391.9m (-0.4%) and EBITDA at €64.7m (-2.0%).
§ In Greece, the market setoff on a positive growth momentum in Q1 2020, thanks to public works projects and increased private investment, while cement export sales were at similar levels to 2019. Revenue was up by 2.4%. In April, domestic sales volumes were impacted by the Covid-19 lockdown measures. Most export destinations moreover postponed cement shipments because of local lockdowns. Following a weak April, resurgent demand in the domestic construction sector, as well as restored export volumes, resulted in a May performance which was at par with last year. Total Revenue for the Greece and Western Europe region in the first five months of 2020 declined by 11.4% to €92.1m. At the operating level, EBITDA reached €3.4m compared to €6.1m in the first 5 months of 2019 reflecting the lower production levels in April-May.
§ Construction in Southeastern Europe had a good start to the year with Revenue at 2019 levels, which turned to a slowdown in late March and April, primarily due to the Covid-19 lockdown measures. In May, sales volumes gradually recovered. Despite the lockdown measures and state of emergency imposed in some countries in the region, which inevitably affected construction, overall market demand proved quite resilient. Construction activity resumed and January-May Revenue for the region posted a 10.4% decrease at €88.9m. The combination of a positive pricing environment with the declining cost of solid fuels, led to an improvement in profitability as EBITDA reached €27.5m, increasing by €1.6m (+6.1%) compared to the first 5 months of 2019.
§ Group net debt at the end of May 2020 closed at €866m, €30m higher vs. end 2019. Operating free cash flow generation was stronger (€19m vs. €9m in 2019) owing to higher EBITDA levels and the reduction of capital expenditure in the current year. As of May 31st the Group maintained liquidity position in excess of €400m in cash balances and available committed bank credit facilities
§ Demand in Egypt recorded significant growth in Q1, with the market posting an increase of about 4.7%. Total revenue in the Eastern Mediterranean region posted a 16.9% increase reaching €68.9m in the first 5 months of 2020. In Q1 Revenue increase had been 21.3%. In an environment of declining solid fuel costs, but stagnant market prices at low levels, operating performance improved as EBITDA was €1.8m positive versus a €5.8m loss in the first 5 months of 2019.
§ In other news press reports state that the company plans to issue a new €300mn bond loan that will repay existing €300mn 3.5% coupon expiring in July 2021
Results stress the fact that the impact of the Covid-19 pandemic on Group was less severe than what was initially feared. We are cautiously optimistic since Q3 is the most important for Group’s profitability while stocks trade (6.6x EV/EBITDA) at a considerable discount vs. its historical EV/EBITDA average.
MYTILINEOS: On June 23, the company bought 20,000 own shares at €8.1542/share and a total consideration of €163.084K. The company now controls 685,029 shares or 0.4794% of share capital.
TERNA ENERGY: On June 23, the company bought 41,000 own shares for a total consideration of €388.2K (€9.47 avg price per share).
BRIQ PROPERTIES: On June 23, the company bought 3,000 own shares at €1.699/share for a total consideration of €5.057K.
FOURLIS: On June 23 the company bought 1,474 own shares at €3.9767/share for a total consideration of €5.8K. total treasury stock stands at 0.8736% of share capital (454,319 shares).
THRACE PLASTICS: The company called for its AGM on July 15.
KARELIAS: AGM approves FY’19 gross dividend distribution €9.4/share (net €8.93/share). Ex dividend date set on June 29. Dividend payment July 6.
ALPHA TRUST: The company goes ex FY 2019 gross dividend €0.1765/share (net €0.167675/share) as of today.
ADMIE HOLDING: AGM on July 16
AVE: FY’19 results out on June 24. AGM July 20. No dividend for FY 2019.
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