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Research: Consumer
Veganz has reduced its FY21 guidance for both revenues and EBITDA. Revenues were lower than expected owing to the Omicron variant, which affected consumer spending in Q4, typically a seasonally strong quarter. Supply chain disruption, particularly on the packaging side, was also unhelpful. The EBITDA loss of €9.8m is wider than anticipated, primarily due to a delay in the payment of state subsidies for the new production site. This was caused by the state subsidies being oversubscribed and receipt of payment is now expected in 2022. We note there is enough liquidity to absorb the costs and hence it is only a timing issue. Also, IPO and bond placement costs were higher than the company forecast. On an underlying basis, the EBITDA loss was €5.3m (excluding subsidies and one-offs).
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Veganz |
Reducing FY21 guidance
Consumer |
Scale research report - Flash
3 March 2022 |
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Veganz has reduced its FY21 guidance for both revenues and EBITDA. Revenues were lower than expected owing to the Omicron variant, which affected consumer spending in Q4, typically a seasonally strong quarter. Supply chain disruption, particularly on the packaging side, was also unhelpful. The EBITDA loss of €9.8m is wider than anticipated, primarily due to a delay in the payment of state subsidies for the new production site. This was caused by the state subsidies being oversubscribed and receipt of payment is now expected in 2022. We note there is enough liquidity to absorb the costs and hence it is only a timing issue. Also, IPO and bond placement costs were higher than the company forecast. On an underlying basis, the EBITDA loss was €5.3m (excluding subsidies and one-offs).
Q4 revenue was affected by the rapid spread of the Omicron variant in the final two months of FY21, which coincided with a typically seasonal strong quarter as consumers increase their food expenditure around Christmas. FY21 sales were €30.4m versus guidance published in October 2021 of €32m. While we do not have quarterly sales splits, this implies a c 15% shortfall in the final quarter. Although some impact is likely to have persisted into Q1, we would expect consumption to return to more normal levels for the rest of FY22. In addition, the gradual easing of restrictions globally is resulting in more on-the-go and out-of-home consumption, which should be helpful for Veganz’s sales in the foodservice channel. To counterbalance this benefit, reduced consumption of food at home may result in slower growth in the more traditional food retail channel compared to the elevated levels witnessed while COVID-19 restrictions were in place across Veganz’s main markets in the DACH region. Altogether, Veganz is well-placed to benefit from increased consumer interest in plant-based diets, and should continue to expand its on-shelf presence as it rolls out new products and in new geographies.
Consensus forecasts are not available. There are few direct listed peers, but we compare Veganz’s valuation to a range of food manufacturers, both within vegan/alternative protein markets and in the European small- and mid-cap food space. Veganz’s FY21 EV/sales multiple of 1.3x is now in line with the average of the mid-cap food manufacturers, at 1.2x, while the vegan/alternative protein manufacturers are on 4.8x. Veganz had higher revenue growth on average than most of its peers for FY20 and FY21, although it lagged the newer and more disruptive players. Veganz remains loss making, like its more direct peers.
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Source: Veganz |
Edison Investment Research provides qualitative research coverage on companies in the Deutsche Börse Scale segment in accordance with section 36 subsection 3 of the General Terms and Conditions of Deutsche Börse AG for the Regulated Unofficial Market (Freiverkehr) on Frankfurter Wertpapierbörse (as of 1 March 2017). Two to three research reports will be produced per year. Research reports do not contain Edison analyst financial forecasts.
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Research: Investment Companies
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