Braemar is the second largest shipbroker in the world, providing broking services to the dry cargo, deep sea tanker, specialised tanker and sale and purchase markets. It also addresses the fast-growing areas of offshore and renewables, securities and financial markets.
The global deep sea shipping fleet has been steadily expanding. A key driver has been growing international trade, which is likely to continue and should have a direct benefit on the shipbroking industry. Some charter rates are currently very high, for example tanker ship charter rates, while others, like the Baltic Dry Index, are broadly within a historical average range and other indicators such as fleet age and low new vessel order books for certain key trades point to greater future demand, thus balancing risks and growth.
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Flash note
Grant Foley
CFO
James Gundy
CEO
Nigel Payne
Chairman
Forecast net cash (£m)
4
Forecast gearing ratio (%)
N/A
% | 1M | 3M | 12M |
---|---|---|---|
Actual | (0.4) | (2.9) | (11.4) |
Relative | (3.5) | (5.4) | (17.2) |
52 week high/low | 312.5p/224.0p |
Braemar’s FY24 trading update was in line with expectations, with revenues of c £150m and underlying operating profit of c £18m. Underlying operations continue to expand and diversify and the company remains well-positioned to drive its future growth strategy. The trading outlook is promising and Braemar should be able to leverage its strong balance sheet in pursuit of strategic growth. We have maintained our underlying estimates for FY24 and FY25, but edge down the valuation based on the lower FY24 dividend expectations. The revised valuation offers nearly 100% upside.
Y/E Feb | Revenue (£m) | EBITDA (£m) | PBT (£m) | EPS (fd) (p) | P/E (x) | P/CF (x) |
---|---|---|---|---|---|---|
2022A | 101.3 | 13.5 | 8.9 | 18.79 | 14.0 | N/A |
2023A | 152.9 | 23.4 | 18.0 | 37.85 | 6.9 | N/A |
2024E | 150.2 | 20.1 | 15.0 | 36.39 | 7.2 | N/A |
2025E | 150.2 | 20.4 | 15.8 | 36.97 | 7.1 | N/A |