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Research: Metals & Mining
Endeavour’s Q123 results are to be published on 4 May 2023. Ahead of their release, we have refined our forecasts for Q123. Following a strong Q422 we are perhaps conservatively assuming a slower rate of production in Q123, albeit leaving our full year production forecast little changed. In addition, we have revised our gold prices for the quarter from US$1,849/oz previously to US$1,883/oz and our assumption for the full year from US$1,819/oz to US$1,937/oz.
Endeavour Mining |
Rising gold prices begin to feed through |
Q123 preview |
Metals and mining |
18 April 2023 |
Share price performance
Business description
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Analysts
Endeavour Mining is a research client of Edison Investment Research Limited |
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Endeavour’s Q123 results are to be published on 4 May 2023. Ahead of their release, we have refined our forecasts for Q123. Following a strong Q422 we are perhaps conservatively assuming a slower rate of production in Q123, albeit leaving our full year production forecast little changed. In addition, we have revised our gold prices for the quarter from US$1,849/oz previously to US$1,883/oz and our assumption for the full year from US$1,819/oz to US$1,937/oz.
Year end |
Revenue (US$m) |
EBITDA (US$m) |
PBT* |
Operating cash flow per share (US$) |
DPS |
Yield |
12/21 |
2,903.8 |
1,517.3 |
756.5 |
4.83 |
56 |
2.2 |
12/22 |
2,508.1 |
1,261.3 |
527.2 |
4.12 |
81 |
4.0 |
12/23e |
2,611.8 |
1,317.1 |
585.8 |
4.71 |
82 |
3.1 |
12/24e |
2,235.7 |
1,228.0 |
708.5 |
4.34 |
100 |
3.8 |
Note: *PBT is normalised, excluding amortisation of acquired intangibles and exceptional items.
Rallying gold prices boost EPS
For now, we have reduced our production estimates for Q123 at Houndé, Boungou, Mana and Sabodala-Massawa by c 33koz (or roughly 10.0%) for the group as a whole in Q123. For the full year, this equates to a 1.7% reduction in our overall production forecast to 1,348koz, which is nevertheless still comfortably within the company’s guidance range for FY23 of 1,325–1,425koz, at an all-in sustaining cost of US$940–995/oz. However, this reduction in production has been more than offset by a rallying gold price, such that our net adjusted EPS forecast for the full year has increased by 7.7%, from US$1.296/share previously to US$1.396/share currently (see below for full details).
Valuation: Trading at a discount to peers
Using our traditional absolute valuation methodology, whereby we discount back four years of cash flows and then apply a perpetual ex-growth multiple to steady-state terminal cash flows in FY26, implies a present valuation for the company of US$35.59 (C$47.92 or £28.45) per share if performed using a 10% discount rate or US$57.02 (C$76.78 or £45.58) per share if performed using a CAPM-derived (real) discount rate of 6.61% (based on inflation expectations of 2.24% derived from US 30-year break-even rates). These compare to valuations of US$36.92 and US$58.99 at the time of our last note in March, respectively. To these valuations a further US$4.30–7.45/share may be added to reflect the value of Endeavour’s five-year exploration programme (see The second five-year plan, published on 20 October 2021). In the meantime, we estimate that Endeavour is trading at a discount to its peers on at least 85.2% of common valuation measures, regardless of whether Edison or consensus forecasts are used. Reverse engineered, the average valuation measures of its peers imply an average share price for Endeavour of US$38.44 (C$51.76 or £30.73) per share.
Updated FY23 forecasts
In the wake of company guidance, our updated forecasts for Endeavour for FY23, by quarter, are as follows:
Exhibit 1: Endeavour Mining FY23e forecasts, by quarter
US$000s (unless otherwise indicated) |
Q123e (prior) |
Q123e |
Q223e |
Q223e |
Q323e |
Q323e |
Q423e |
Q423e |
FY23e |
FY23e |
Houndé production (koz) |
55.1 |
42.6 |
55.1 |
71.1 |
79.3 |
80.0 |
87.9 |
80.0 |
277.2 |
277.5 |
Karma production (koz) |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
Ity production (koz) |
73.2 |
83.6 |
71.0 |
74.4 |
65.4 |
74.4 |
75.4 |
74.4 |
306.9 |
285.0 |
Boungou production (koz) |
28.0 |
22.1 |
28.0 |
25.2 |
29.5 |
29.5 |
29.5 |
29.5 |
106.2 |
114.9 |
Mana production (koz) |
52.5 |
39.5 |
52.5 |
44.7 |
52.5 |
52.5 |
52.5 |
52.5 |
189.1 |
209.9 |
Sabodala-Massawa (koz) |
78.8 |
63.5 |
78.8 |
78.8 |
77.3 |
77.3 |
86.3 |
86.3 |
306.0 |
321.3 |
Wahgnion (koz) |
37.9 |
37.9 |
38.9 |
38.9 |
42.2 |
42.2 |
43.7 |
43.7 |
162.7 |
162.7 |
Total gold produced (koz) |
325.5 |
292.8 |
324.2 |
333.1 |
346.2 |
355.8 |
375.3 |
366.4 |
1,348 |
1,371 |
Total gold sold (koz) |
325.5 |
292.8 |
324.2 |
333.1 |
346.2 |
355.8 |
375.3 |
366.4 |
1,348 |
1,371 |
Gold price (US$/oz) |
1,849 |
1,883 |
1,809 |
1,952 |
1,810 |
1,953 |
1,809 |
1,952 |
1,937 |
1,819 |
Mine level cash costs (US$/oz)* |
725 |
828 |
773 |
791 |
718 |
702 |
650 |
651 |
738 |
714 |
Mine level AISC (US$/oz) |
968 |
1,102 |
1,014 |
1,052 |
954 |
931 |
876 |
877 |
983 |
950 |
Revenue |
||||||||||
– Gold revenue |
601,720 |
551,230 |
586,486 |
650,330 |
626,457 |
694,938 |
679,137 |
715,344 |
2,611,842 |
2,493,800 |
Cost of sales |
||||||||||
– Operating expenses |
236,044 |
242,456 |
250,676 |
263,492 |
248,724 |
249,917 |
244,015 |
238,545 |
994,410 |
979,459 |
– Royalties |
37,869 |
34,603 |
36,943 |
41,358 |
40,195 |
44,406 |
43,557 |
45,604 |
165,971 |
158,564 |
Gross profit |
327,807 |
274,171 |
298,868 |
345,479 |
337,537 |
400,615 |
391,566 |
431,195 |
1,451,460 |
1,355,778 |
Depreciation |
(140,624) |
(153,872) |
(144,597) |
(159,994) |
(158,508) |
(173,287) |
(172,724) |
(185,239) |
(672,392) |
(616,454) |
Expenses |
||||||||||
– Corporate costs |
(15,000) |
(15,000) |
(15,000) |
(15,000) |
(15,000) |
(15,000) |
(15,000) |
(15,000) |
(60,000) |
(60,000) |
– Impairments |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
– Acquisition etc costs |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
– Share based compensation |
(6,453) |
(8,584) |
(6,453) |
(7,957) |
(6,453) |
(7,315) |
(6,453) |
(7,315) |
(31,171) |
(25,814) |
– Exploration costs |
(8,750) |
(10,800) |
(8,750) |
(10,800) |
(8,750) |
(10,800) |
(8,750) |
(10,800) |
(43,200) |
(35,000) |
Total expenses |
(30,203) |
(34,384) |
(30,203) |
(33,757) |
(30,203) |
(33,115) |
(30,203) |
(33,115) |
(134,371) |
(120,814) |
Earnings from operations |
156,979 |
85,915 |
124,067 |
151,729 |
148,826 |
194,213 |
188,638 |
212,840 |
644,698 |
618,511 |
Interest income |
0 |
|||||||||
Interest expense |
(17,842) |
(14,407) |
(19,603) |
(15,370) |
(18,853) |
(14,655) |
(17,090) |
(14,439) |
(58,871) |
(73,387) |
Net interest |
(17,842) |
(14,407) |
(19,603) |
(15,370) |
(18,853) |
(14,655) |
(17,090) |
(14,439) |
(58,871) |
(73,387) |
Loss on financial instruments |
(901) |
(1,890) |
300 |
(4,020) |
300 |
(4,020) |
300 |
(4,020) |
(13,950) |
(1) |
Other expenses |
0 |
0 |
0 |
0 |
0 |
0 |
||||
Profit before tax |
138,236 |
69,618 |
104,790 |
132,339 |
130,326 |
175,538 |
171,926 |
194,382 |
571,876 |
545,277 |
Current income tax |
40,896 |
26,803 |
34,138 |
41,687 |
37,611 |
47,618 |
46,031 |
51,376 |
167,484 |
158,676 |
Deferred income tax |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
Total tax |
40,896 |
26,803 |
34,138 |
41,687 |
37,611 |
47,618 |
46,031 |
51,376 |
167,484 |
158,676 |
Effective tax rate (%) |
29.6 |
38.5 |
32.6 |
31.5 |
28.9 |
27.1 |
26.8 |
26.4 |
29.3 |
29.1 |
Profit after tax |
97,340 |
42,815 |
70,651 |
90,651 |
92,715 |
127,920 |
125,895 |
143,005 |
404,392 |
386,602 |
Net profit from discontinued ops. |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
Total net and comprehensive income |
97,340 |
42,815 |
70,651 |
90,651 |
92,715 |
127,920 |
125,895 |
143,005 |
404,392 |
386,602 |
Minority interest |
17,205 |
10,190 |
14,297 |
17,239 |
16,132 |
20,801 |
19,869 |
22,407 |
70,637 |
67,503 |
Minority interest (%) |
17.7 |
23.8 |
20.2 |
19.0 |
17.4 |
16.3 |
15.8 |
15.7 |
17.5 |
17.5 |
Profit attributable to shareholders |
80,135 |
32,625 |
56,355 |
73,412 |
76,583 |
107,119 |
106,027 |
120,599 |
333,755 |
319,099 |
Basic EPS from continuing ops (US$) |
0.326 |
0.229 |
0.311 |
0.431 |
1.296 |
|||||
Diluted EPS from continuing ops (US$) |
0.324 |
0.132 |
0.228 |
0.296 |
0.310 |
0.431 |
0.429 |
0.486 |
1.345 |
1.292 |
Basic EPS (US$) |
0.326 |
0.132 |
0.229 |
0.297 |
0.311 |
0.433 |
0.431 |
0.487 |
1.349 |
1.296 |
Diluted EPS (US$) |
0.324 |
0.132 |
0.228 |
0.296 |
0.310 |
0.431 |
0.429 |
0.486 |
1.345 |
1.292 |
Norm. basic EPS from cont. ops (US$) |
0.329 |
0.140 |
0.228 |
0.313 |
0.310 |
0.449 |
0.430 |
0.504 |
1.406 |
1.296 |
Norm. diluted EPS from cont. ops (US$) |
0.328 |
0.139 |
0.227 |
0.312 |
0.309 |
0.448 |
0.428 |
0.502 |
1.401 |
1.292 |
Adj net earnings attributable (US$000s) |
80,877 |
34,065 |
56,115 |
76,668 |
76,335 |
110,485 |
105,774 |
123,989 |
345,207 |
319,101 |
Adj net EPS from continuing ops (US$) |
0.329 |
0.138 |
0.228 |
0.310 |
0.310 |
0.446 |
0.430 |
0.501 |
1.396 |
1.296 |
Source: Endeavour Mining, Edison Investment Research. Note: *Excludes royalty costs.
A number of features of our earnings forecasts are notable, including a 9.4% increase in our depreciation charge for Q1 (versus our prior estimate) following a number of changes in the method of depreciation calculation in late 2022. This in addition to our decreased production forecasts has resulted in a 16.4% decrease in our estimate for gross profit during Q123 and a 58.1% drop in adjusted net EPS compared to our prior forecast of US$0.329. Albeit we leave our full year production forecast little changed at 1348koz (cf 1371koz, previously), comfortably within the FY23 guided range (1,325–1,425koz). This, together with an assumed increase in the gold price for the remainder of the year, has resulted in an increase in our net adjusted EPS for FY23 overall. We believe that we remain relatively conservative with our gold price assumptions. If the prevailing gold price of US$2,005/oz (Bloomberg: 11 April 2023) continues for the remainder of the year (Q223–Q423), then our EPS forecast would be US$1.511/share.
A comparison between our quarterly and full-year forecasts and consensus forecasts for FY23 is as follows:
Exhibit 2: Edison adjusted net EPS from continuing operations estimates cf consensus FY23 by quarter
(US$/share) |
Q123e |
Q223e |
Q323e |
Q423e |
Sum Q1–Q423 |
FY23e |
Edison |
0.138 |
0.310 |
0.446 |
0.501 |
1.395 |
1.396 |
Mean consensus forecast |
0.43 |
0.38 |
0.54 |
0.61 |
1.96 |
2.10 |
High consensus forecast |
0.54 |
0.61 |
0.93 |
1.20 |
3.28 |
3.28 |
Low consensus forecast |
0.28 |
0.30 |
0.37 |
0.30 |
1.25 |
1.43 |
Source: Refinitiv, Edison Investment Research. Note: Consensus at 11 April 2023.
While we do not explicitly forecast cash flows on a quarterly basis, we believe that cash flows at Endeavour in Q1 will have been restrained by the payment of FY22’s final dividend during the quarter, an increase in cash taxes (after three assets deferred tax payments in Q4), share repurchases totalling some US$12.5m and Endeavour’s decision to redeem its US$330m convertible bond, rather than allowing it to convert into ordinary shares. Finally, we also assume Endeavour will have settled a US$50m payment in respect of a deferred payment to Barrick relating to the former’s acquisition of Teranga in Q121.
Valuation
Endeavour is a multi-asset company that has shown a willingness and desire to trade assets to maintain production, reduce costs and maximise returns to shareholders (eg the sale of Youga in FY16, Nzema in FY17, Tabakoto in FY18, Agbaou in FY20 and Karma in FY22, and the acquisition of SEMAFO in FY20 and Teranga in FY21). Historically, rather than our customary method of discounting maximum potential dividends over the life of operations back to FY23, for Endeavour we have opted to discount four years of forecast cash flows in FY23–26 back to FY23, then apply an ex-growth terminal multiple of 10x (consistent with using a standardised discount rate of 10%) to forecast cash flows in that year (ie FY26). We would normally exclude exploration expenditure from such a calculation on the basis that it is an investment. In the case of Endeavour, however, we included it because it was a critical component of the company’s ability to continually expand and extend the lives of its mines.
Our estimate of cash flows remains consistent in FY26 at US$4.25/share (cf US$4.28/share previously), which implies a terminal valuation of Endeavour at end-FY26 of US$42.48/share, calculated using a discount rate of 10%. With our forecast intervening cash flows, this terminal valuation then discounts back to a present valuation of US$35.59/share at the start of FY23, as shown in Exhibit 3 below.
|
Exhibit 3: Endeavour forecast valuation and cash flow per share, FY23–26e (US$/share) |
|
|
Source: Edison Investment Research |
Given its elevation into the ranks of the world’s foremost producers of gold, however, we believe Endeavour can increasingly attract lower-cost finance and, as such, we may also consider a CAPM (capital asset pricing model) derived valuation. In this case, long-term nominal equity returns have been 9% and 30-year break-evens indicate an inflation rate of 2.2240% (source Bloomberg, 11 April 2023) versus 2.2853% previously. These two measures imply an expected real equity return of 6.61% (1.09/1.022399) and applying this to our forecast cash flows would imply a terminal valuation for Endeavour of US$64.25/share (US$65.18/share previously) and a current valuation of US$57.02/share (US$58.99/share previously).
Endeavour peer valuation
On a series of commonly used measures relative to a selection of gold mining majors (the ranks of which it has now joined since its takeovers of SEMAFO and Teranga), Endeavour’s valuation is as follows:
Exhibit 4: Endeavour’s valuation relative to peers
Company |
Ticker |
Price/cash flow (x) |
EV/EBITDA (x) |
Yield (%) |
||||||
Year 1 |
Year 2 |
Year 3 |
Year 1 |
Year 2 |
Year 3 |
Year 1 |
Year 2 |
Year 3 |
||
Endeavour (Edison) |
EDV |
5.6 |
6.1 |
5.5 |
4.9 |
5.2 |
4.8 |
3.1 |
3.8 |
5.5 |
Endeavour (consensus) |
EDV |
5.9 |
5.5 |
5.1 |
5.2 |
4.8 |
4.8 |
3.3 |
3.2 |
3.9 |
Majors |
||||||||||
Barrick |
ABX |
8.4 |
7.9 |
7.3 |
8.1 |
7.0 |
6.9 |
2.1 |
2.9 |
3.4 |
Newmont |
NEM |
10.2 |
9.9 |
9.5 |
8.7 |
8.0 |
7.9 |
3.2 |
3.1 |
3.2 |
Newcrest |
NCM AU |
11.7 |
10.6 |
10.6 |
8.9 |
9.1 |
8.7 |
2.1 |
1.2 |
2.3 |
Kinross |
K |
5.2 |
5.1 |
5.4 |
6.1 |
6.1 |
6.0 |
2.4 |
2.4 |
2.4 |
Agnico-Eagle |
AEM |
11.5 |
10.9 |
12.0 |
9.9 |
9.2 |
8.9 |
3.0 |
3.1 |
3.2 |
Eldorado |
ELD |
6.0 |
5.4 |
4.4 |
5.5 |
4.8 |
3.8 |
0.0 |
0.0 |
0.0 |
Average |
|
8.8 |
8.3 |
8.2 |
7.9 |
7.4 |
7.0 |
2.1 |
2.1 |
2.4 |
Implied EDV share price (US$) |
36.43 |
39.07 |
35.57 |
40.60 |
39.88 |
35.98 |
38.03 |
38.81 |
41.60 |
|
Implied EDV share price (C$) |
50.36 |
54.00 |
49.17 |
56.11 |
55.12 |
49.73 |
52.56 |
53.65 |
57.50 |
|
Source: Edison Investment Research, Refinitiv. Note: Consensus and peers priced at 11 April 2023.
Of note is that, without exception, Endeavour’s valuation is materially lower than the averages of all nine of the measures shown in Exhibit 4, regardless of whether Edison or consensus forecasts are used. On an individual basis, it is lower than its senior gold mining peers on at least 46 out of 54 (85%) valuation measures if Edison forecasts are used and 49 out of 54 (91%) valuation measures if consensus forecasts are used. Reverse engineered, the average valuation measures of its peers imply an average share price for Endeavour of US$38.44 (C$51.76 or £30.73) per share.
Exhibit 5: Financial summary
US$'000s |
2019 |
2020 |
2021 |
2022 |
2023e |
2024e |
2025e |
||
Year end 31 December |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
|||||||||
Revenue |
|
|
1,362,121 |
1,847,894 |
2,903,756 |
2,508,100 |
2,611,842 |
2,235,703 |
2,497,482 |
Cost of Sales |
(884,869) |
(1,061,891) |
(1,675,393) |
(1,607,100) |
(1,294,752) |
(1,007,684) |
(1,154,374) |
||
Gross Profit |
477,252 |
786,003 |
1,228,363 |
901,000 |
1,317,089 |
1,228,019 |
1,343,107 |
||
EBITDA |
|
|
618,443 |
910,295 |
1,517,263 |
1,261,300 |
1,317,089 |
1,228,019 |
1,343,107 |
Operating Profit (before amort. and except.) |
|
281,400 |
546,072 |
859,409 |
645,300 |
644,698 |
707,316 |
766,293 |
|
Exceptionals |
(199,159) |
(201,532) |
(266,000) |
(382,600) |
(13,950) |
0 |
0 |
||
Other |
(9,392) |
8,886 |
(32,263) |
(51,900) |
0 |
0 |
0 |
||
Operating Profit |
72,849 |
353,426 |
561,146 |
210,800 |
630,748 |
707,316 |
766,293 |
||
Net Interest |
(51,607) |
(53,774) |
(70,623) |
(66,200) |
(58,871) |
1,162 |
2,437 |
||
Profit Before Tax (norm) |
|
|
220,401 |
501,184 |
756,523 |
527,200 |
585,826 |
708,479 |
768,731 |
Profit Before Tax (FRS 3) |
|
|
21,242 |
299,652 |
490,523 |
144,600 |
571,876 |
708,479 |
768,731 |
Tax |
(97,253) |
(158,466) |
(178,253) |
(175,600) |
(167,484) |
(149,734) |
(161,588) |
||
Profit After Tax (norm) |
123,148 |
342,718 |
578,270 |
351,600 |
418,342 |
558,745 |
607,142 |
||
Profit After Tax (FRS 3) |
(76,011) |
141,186 |
312,270 |
(31,000) |
404,392 |
558,745 |
607,142 |
||
Net loss from discontinued operations |
(4,394) |
0 |
0 |
9,100 |
0 |
0 |
0 |
||
Minority interests |
33,126 |
44,719 |
64,486 |
35,400 |
74,637 |
88,338 |
105,690 |
||
Net profit |
(80,405) |
141,186 |
312,270 |
(21,900) |
404,392 |
558,745 |
607,142 |
||
Net attrib. to shareholders contg. businesses (norm) |
90,022 |
297,998 |
513,784 |
316,200 |
347,705 |
470,407 |
501,453 |
||
Net attrib.to shareholders contg. businesses |
(109,137) |
96,466 |
247,784 |
(66,400) |
333,755 |
470,407 |
501,453 |
||
Average Number of Shares Outstanding (m) |
157.4 |
160.8 |
250.7 |
247.8 |
247.3 |
247.5 |
247.5 |
||
EPS - normalised (c) |
|
|
57.20 |
185.34 |
204.95 |
127.59 |
140.59 |
190.07 |
202.62 |
EPS - normalised fully diluted (c) |
|
|
56.95 |
181.51 |
203.21 |
125.32 |
138.08 |
186.69 |
199.01 |
EPS - (IFRS) ($) |
|
|
(0.72) |
0.60 |
0.99 |
(0.23) |
1.35 |
1.90 |
2.03 |
Dividend per share (c) |
0 |
37 |
56 |
81 |
82 |
100 |
144 |
||
Gross Margin (%) |
35.0 |
42.5 |
42.3 |
35.9 |
50.4 |
54.9 |
53.8 |
||
EBITDA Margin (%) |
45.4 |
49.3 |
52.3 |
50.3 |
50.4 |
54.9 |
53.8 |
||
Operating Margin (before GW and except.) (%) |
20.7 |
29.6 |
29.6 |
25.7 |
24.7 |
31.6 |
30.7 |
||
BALANCE SHEET |
|||||||||
Fixed Assets |
|
|
2,330,033 |
5,093,409 |
5,404,900 |
4,968,300 |
5,060,908 |
5,194,383 |
5,008,413 |
Intangible Assets |
5,498 |
24,851 |
10,000 |
0 |
0 |
0 |
0 |
||
Tangible Assets |
2,254,476 |
3,968,746 |
4,980,200 |
4,517,000 |
4,609,608 |
4,743,083 |
4,557,113 |
||
Investments |
70,059 |
1,099,812 |
414,700 |
451,300 |
451,300 |
451,300 |
451,300 |
||
Current Assets |
|
|
652,871 |
1,168,382 |
1,366,000 |
1,446,400 |
1,252,933 |
1,302,514 |
1,725,307 |
Stocks |
266,451 |
305,075 |
311,300 |
320,700 |
326,480 |
279,463 |
312,185 |
||
Debtors |
83,836 |
104,545 |
139,900 |
163,400 |
271,172 |
240,256 |
261,772 |
||
Cash |
288,186 |
751,563 |
906,200 |
951,100 |
658,031 |
785,544 |
1,154,099 |
||
Other |
14,398 |
7,199 |
8,600 |
11,200 |
(2,750) |
(2,750) |
(2,750) |
||
Current Liabilities |
|
|
(354,931) |
(661,171) |
(567,100) |
(1,045,600) |
(813,252) |
(731,861) |
(793,917) |
Creditors |
(312,427) |
(612,862) |
(552,700) |
(690,800) |
(788,452) |
(707,061) |
(769,117) |
||
Short term borrowings |
(42,504) |
(48,309) |
(14,400) |
(354,800) |
(24,800) |
(24,800) |
(24,800) |
||
Long Term Liabilities |
|
|
(963,736) |
(1,647,799) |
(1,818,100) |
(1,281,800) |
(1,231,800) |
(1,231,800) |
(1,231,800) |
Long term borrowings |
(770,902) |
(1,026,337) |
(878,600) |
(517,000) |
(517,000) |
(517,000) |
(517,000) |
||
Other long term liabilities |
(192,834) |
(621,462) |
(939,500) |
(764,800) |
(714,800) |
(714,800) |
(714,800) |
||
Net Assets |
|
|
1,664,237 |
3,952,821 |
4,385,700 |
4,087,300 |
4,268,789 |
4,533,235 |
4,708,003 |
CASH FLOW |
|||||||||
Operating Cash Flow |
|
|
628,617 |
1,046,370 |
1,415,306 |
1,211,200 |
1,332,360 |
1,224,561 |
1,350,924 |
Net Interest |
(35,413) |
(53,774) |
(26,900) |
(66,200) |
(58,871) |
1,162 |
2,437 |
||
Tax |
(109,494) |
(186,332) |
(205,573) |
(189,200) |
(167,484) |
(149,734) |
(161,588) |
||
Capex |
(401,227) |
(335,599) |
(587,496) |
(534,300) |
(815,000) |
(654,178) |
(390,844) |
||
Acquisitions/disposals |
3,654 |
(19,000) |
(4,700) |
12,900 |
5,000 |
0 |
0 |
||
Financing |
2,402 |
100,000 |
(89,400) |
(101,200) |
(12,547) |
0 |
0 |
||
Dividends |
(6,154) |
(88,288) |
(159,800) |
(223,800) |
(246,527) |
(294,299) |
(432,375) |
||
Net Cash Flow |
82,385 |
463,377 |
341,437 |
109,400 |
36,931 |
127,513 |
368,555 |
||
Opening net debt/(cash) |
|
|
518,607 |
525,220 |
323,083 |
(13,200) |
(79,300) |
(116,231) |
(243,744) |
Other |
(88,998) |
(261,240) |
(5,154) |
(43,300) |
0 |
0 |
0 |
||
Closing net debt/(cash) |
|
|
525,220 |
323,083 |
(13,200) |
(79,300) |
(116,231) |
(243,744) |
(612,299) |
Source: Company sources, Edison Investment Research
|
|
Research: Healthcare
Creo Medical has announced that it has acquired the remaining 5% stake in Albyn Medical (for €1.2m), a subsidiary that is Creo’s primary revenue contributor (c €20m in FY22 sales, per our estimates). The payout also included a previously agreed €1m earnout payment. Albyn Medical is a seller of own and third-party consumables and systems (primarily gastrointestinal (GI) endoscopy related) with core focus on the UK and European markets and complements Creo’s core portfolio of minimally invasive electrosurgical devices. Creo acquired a 90% stake in Albyn in July 2020 for an equity value of €24.8m and €2.7m in performance-related payments over two years. Creo then acquired another 5% stake in March 2022 (for €1.2m and an additional €1.7m as the first earnout tranche) followed by the balance in the latest announcement. We expect the franchise to contribute steadily to the top line, driven by ongoing expansion efforts into the US market.
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