£1013.2m market cap
5160p last close
XP Power is a developer and designer of power control solutions with production facilities in China, Vietnam and the US, and design, service and sales teams across Europe, the US and Asia.
Investment summary
XP reported a strong finish to 2020, with Q4 revenues up 24% y-o-y and 4% ahead of our forecast, driving FY20 profitability ahead of expectations. Order intake has normalised to pre-COVID-19 levels (Q420 £55.9m, down 4% y-o-y), reflecting continued strong demand from the semiconductor sector. Year-end net debt of £18.0m was substantially lower than our £38.2m forecast, mainly due to good working capital management, but aided by the weaker dollar at year-end. We have revised our estimates to reflect the strong Q420 performance and the weaker dollar, driving a 3.0% increase in FY20 EPS and a 2.3% cut to our FY21 EPS.
Y/E Dec |
Revenue (£m) |
EBITDA (£m) |
PBT (£m) |
EPS (fd) (p) |
P/E (x) |
P/CF (x) |
|---|---|---|---|---|---|---|
| 2019A | 199.9 | 44.5 | 32.3 | 141.4 | 36.5 | N/A |
| 2020A | 233.3 | 56.8 | 44.3 | 198.4 | 26.0 | N/A |
| 2021E | 227.8 | 54.6 | 41.5 | 171.4 | 30.1 | N/A |
| 2022E | 237.8 | 58.4 | 44.9 | 185.3 | 27.8 | N/A |
Industry outlook
XP supplies four end-markets: healthcare, industrial electronics, semiconductors and technology, across Europe, North America and Asia. The industrial electronics segment is relatively fragmented, but the company sees demand across various applications. The healthcare business continues to gain market share, with corporate approvals from the major suppliers in place. The semiconductor segment is the most cyclical, tracking the capex requirements of semiconductor manufacturers.
Last updated on 04/03/2021
Sector |
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Share price graph
Balance sheet |
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|---|---|
| Forecast net debt (£m) | 18.8 |
| Forecast gearing ratio (%) | 11 |
Price performance
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12m |
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Key management |
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| James Peters | Chairman |
| Gavin Griggs | Chief Financial Officer & Executive Director |
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