paragon

DE: PGN

€64.5m market cap

€14.26 last close

paragon designs and supplies automotive electronics and solutions, selling directly to OEMs, including sensors, interiors, digital assistance and body kinematics. Production facilities are in Germany, the US and China. Following the IPO in October 2017, paragon owns 60% of Voltabox.

Investment summary

On 12 August paragon revised guidance for FY19 to revenues of between €200m and €210m, down around €30m with a negative group EBIT margin of -1% to -2% (from 8% previously). Our forecasts are under review. The vast majority of the change comes from the Voltabox business where a battery supplier is transitioning to the latest cell technology leading to supply delays, compounded by a postponed US order. In addition, the known market challenges in the Automotive segment have led to a worsening mix, as well as one-off costs of €7m to consolidate development and production sites. These will depress segment EBIT margins to between 3–4%.

Y/E Dec
Revenue (€m)
EBITDA (€m)
PBT (€m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2017A 124.8 18.3 5.9 (8.52) N/A 80.2
2018A 187.4 30.3 14.8 144.58 9.9 N/A
2019E 240.2 38.6 18.8 241.14 5.9 1.3
2020E 295.3 47.0 24.3 299.33 4.8 1.8
Last updated on 18/09/2019
Industry outlook

We believe paragon’s identification of, and investment in, solutions to address megatrends in global automotive and electromobility markets is understood by the capital markets. It is growing substantially faster than its markets due to innovative products that are driving changes in customer perceptions, creating new growth engines for the group.

Last updated on 18/09/2019
Sector
Industrials
Share price graph
Balance sheet
Forecast net debt (€m) 72.6
Forecast gearing ratio (%) 34
Price performance
%
1m
3m
12m
Actual 48.2 (33.2) (67.0)
Relative* 38.3 (33.5) (67.6)
52-week high/low €44.1/€9.6
*% relative to local index
Key management
Klaus Frers CEO

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