Findel

LN: FDL

£142.6m market cap

165p last close

Findel is a multi-channel retailer operating across the business-to-consumer and business-to-business market places. It is a market leader in the home shopping and educational supplies sectors in the UK.

Investment summary

Findel continues to differentiate its performance positively against the mainstream of UK retail. Studio’s product sales grew 13.6% in the 15 weeks to end December, up on 12% previously reported for 10 weeks. Online sales hit a new peak of 78% of orders, and margins continue in a range 125–175bp ahead of the prior year. In a quiet period for schools spend, Q3 Education core revenue grew 3.8%. We have upgraded our underlying PBT forecasts (now adjusted for IFRS9) by 3.8% for FY19 and 3.5% for FY20, reflecting the higher level of product sales. We value the shares at 348p.

Y/E Mar
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (p)
P/E (x)
P/CF (x)
2017A 457.0 40.8 22.2 20.4 8.1 11.6
2018A 479.0 46.6 26.8 25.9 6.4 12.4
2019E 506.6 49.8 27.0 26.3 6.3 5.0
2020E 539.9 53.8 29.2 28.2 5.9 4.9
Last updated on 21/03/2019
Industry outlook

In the three months to January 2019, UK retail sales (excluding fuel) grew 3.5% y-o-y by volume and 3.9% by value. However, online sales rose 11.8% in the same three months y-o-y, creating additional tailwinds for Studio which trades 78% online. The squeeze on schools’ budgets continues to restrain the education supply sector.

Last updated on 21/03/2019
Sector
Consumer
Share price graph
Balance sheet
Forecast net debt (£m) 229.4
Forecast gearing ratio (%) 368
Price performance
%
1m
3m
12m
Actual (9.8) (17.1) (26.7)
Relative* (11.8) (24.3) (29.0)
52-week high/low 302.0p/154.0p
*% relative to local index
Key management
Ian Burke Chairman
Philip Maudsley CEO
Stuart Caldwell CFO

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