Original-Research: Aves One AG - von GBC AG
Einstufung von GBC AG zu Aves One AG
Unternehmen: Aves One AG
Anlass der Studie:
Kursziel: 13.50 EUR
Kursziel auf Sicht von: 31.12.2021
Letzte Ratingänderung: -
Analyst: Matthias Greiffenberger, Cosmin Filker
Good performance in HY 2020 especially in the rail segment with results
slightly above last year's level, target price adjusted to € 13.50
(previously: € 13.60); Rating: Buy.
In the first half of 2020, revenues were up 14.4% to €63.57m (previous
year: €55.56m). This significant increase in revenue was achieved despite
the corona crisis, with € 3.39 million coming from the sale of the last
property activity in the first quarter. The rail segment continues to
account for the largest share of revenue at €41.16m (previous year:
€35.76m) and, thanks to the additional assets, was also able to increase
revenue by 15.1%. Revenues from the container segment increased slightly by
0.9% to €18.26m (previous year: €18.09m) and reflect the strategy of
focusing on the rail segment.
The significant increase in sales is primarily the result of investment
activities in the previous year as well as in the current financial year
and the associated increase in sales. Property, plant and equipment as at
30 June 2020 rose by 16.0% to €973.86m (previous year: €839.34m). While
adjustments were made in the container segment, where property, plant and
equipment fell by 6.8% to €260.42m (previous year: €279.51m), property,
plant and equipment in the rail portfolio increased by 27.5% to €713.44m
(previous year: €559.40m). Investments of €65.3m were made and 669 almost
fully leased freight wagons were acquired. Due to the streamlining of the
container portfolio, gross returns (revenue / property, plant and
equipment) rose to 7% (previous year: 6.5%), while gross returns in the
rail sector fell to 5.8% (previous year: 6.4%).
Slightly lower gross returns in the rail segment is due to lower capacity
utilisation. However, capacity utilisation is still at a very high level,
although it has nevertheless declined slightly. This is due, on the one
hand, to the corona crisis, which has caused individual customer sectors to
be more cautious with regard to rents and, on the other hand, to the
ongoing crisis in the steel sector, which had begun even before the corona
crisis. According to the management, Aves One has leased almost all wagons
that can only be used in the steel industry on a long-term basis and
therefore does not expect any further negative consequences from this. If,
in addition, the state players decide to implement an infrastructure
programme to reduce the negative consequences of the corona crisis, Aves
One should benefit disproportionately from this, as many customer segments
would be positively affected.
All in all, good sales growth was thus achieved, as achieved through asset
expansion in the rail division.
Despite the increase in revenue, EBITDA remained virtually unchanged from
the previous year, rising only slightly by 0.8% to €42.16 million (previous
year: €41.85 million). This reduced the EBITDA margin to 66.3% (previous
year: 75.3%). The reason for this was the lower contribution to earnings
from the container segment.
In the rail segment EBITDA rose by 15.2% to €32.36 million (previous year:
€28.09 million), thus parallel to sales and corresponding to a stable
EBITDA margin of 78.6% (previous year: 78.6%). The container segment
recorded a 19.1% decline in EBITDA to €12.75 million (previous year: €15.76
million) with an EBITDA margin in the segment falling to 69.9% (previous
year: 87.1%). This decline in earnings is due to losses of €1.83 million
(previous year: €0.57 million) from the disposal of assets and €1.07
million in other income. Thanks to our lean management approach, staff
costs remained virtually unchanged year on year at €2.42m (previous year:
€2.34m) despite the expansion of assets and the increase in sales.
Interest expenses rose by 11.4% to €21.32m (previous year: €19.14m) as a
result of taking out further loans, particularly to finance the increase in
assets under management.
As a result, EBT fell by 71.3% to €2.28m (previous year: €7.94m), divided
before holding activities and consolidation into €9.41m (previous year:
€10.00m) for the rail segment and € -4.22m (previous year: € -0.26m) for
the container segment. Adjusted for non-cash exchange rate effects, EBT
amounted to €1.78 million (previous year: €6.77 million).
The net result amounted to €1.38 million (previous year: €5.05 million).
Thus, net profitability was maintained. Nevertheless, against the
background of the corona crisis, 2020 must be seen as a transitional year.
The guidance was confirmed in the context of the half-year figures. The
guidance is currently slightly above the previous year's level with
revenues of over €117.00 million and EBITDA of over €84.00 million. Against
the background of the ongoing corona crisis, management has issued
comparatively cautious guidance in this regard. We also confirm our
forecast (research report dated 18 May 2020) and are forecasting revenue of
€119.15m for the current financial year. We anticipate a slight increase in
capacity utilisation and additional revenue from the acquisition of further
assets. For subsequent years we forecast revenues of €127.87m in the 2021
financial year and €142.80m in 2022.
The background to the lowering of the forecast is higher depreciation in
the Container Segment and slightly higher financing costs. In addition, it
is difficult to forecast further developments in the year of the corona
crisis. We assume that the corona crisis year could also be used to bring
forward further potential for writedowns, which could then lead to
improvements in subsequent years. The development in container prices,
demand for containers and prices for used containers are also decisive
factors in this respect.
Aves One AG has medium to long-term rental contracts which ensure a good
sales basis and the rental rates should also remain at a very good level.
The company has a very young wagon portfolio, which is in demand during the
crisis period. Nevertheless, there are also individual sectors affected by
Corona in which there is still restraint. In the medium term, we assume
that the rail portfolio is well equipped to benefit from the growth market.
Thus, in the wake of the possible economic crisis, investments in
infrastructure projects will most likely be made to boost the economy. In
addition, the company will benefit from the liberalization of rail freight
transport and the EU's emission targets. We assume that there will be
further comparatively small transactions in the rail sector of up to €50
million. All in all, we are assuming good medium-term growth and regard
2020 as a year of transition.
In terms of earnings, we expect a slight improvement in the current 2020
EBITDA will increase to €86.44 million (previous year: €84.60 million), as
the asset portfolio has increased during the course of the 2019 financial
year, thus creating a higher sales and earnings base. On the other hand,
capacity utilisation will be slightly lower, which will reduce revenue and
earnings. We assume that revenue growth will continue to have a
disproportionately high impact on EBITDA and expect an EBITDA margin
increase from 72.4% (2019) to 72.5% (2020), or 73.1% (2021) and 73.7%
(2022), respectively. Accordingly, we forecast EBITDA of €86.44 million for
the current financial year 2020, followed by €93.49 million in 2021 and
€105.29 million in 2022.
On a net level, interest expense should be the decisive influencing factor.
We assume that interest expenses will continue to rise as assets under
management increase, as future portfolio acquisitions will most likely be
financed with debt. We expect improvements in the financing mix, especially
from the 2021 financial year onwards, and assume that net earnings will
continue to rise in the medium term. For the current fiscal year 2020, we
expect a decline to € 4.16 million and then solid growth to € 10.45 in 2021
and € 11.87 in 2022.
We are confident that Aves One's business model is well equipped to weather
the corona, trade & economic crisis. Nevertheless, future developments are
difficult to predict, as the duration and extent of the crisis are
difficult to estimate.
Due to the slight forecast adjustment for the current 2020 financial year,
we are adjusting our price target to € 13.50 (previously: € 13.60) and
continue to assign the Buy rating.
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Date (time) of completion: 05.10.2020 10:30
Date (time) first transmission: 05.10.2020 12:00
Validity of the course target: until max. 31.12.2021
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