D'Ieteren slips after 'only' slight profit beat, lower FCF
09/03/2023 09:26
** Shares in D'Ieteren IETB.BR drop around 3% after
"solid" annual results and 2023 profit outlook, as analysts
point to even higher investor expectations and weak cash flow
** It sees adjusted profit before tax (PBT), group share, of
around 900 mln euros ($950 mln) this year, compared with the
733.4 mln euros it posted for 2022
** KBC Securities analyst Michiel Declerc told Reuters in an
email that "yesterday's results were only slightly better than
expected", while ING says in a note the PBT outlook is only 2%
above consensus
** "In the past D'Ieteren has often exceeded css (consensus)
expectations by a wide margin, which is clearly what investors
were hoping for again today looking at the share price
reaction," Declerc says
** He also flags a demand slowdown in the group's TVH & PHE
businesses due to the tough economic environment
** ING points to weaker FCF generation across the board:
"Key culprit here is the explosion in inventories at Auto, which
led to a negative FCF of €101m vs. a guidance of at least
+€108m"
** D'Ieteren's FCF after tax dropped to 298.8 mln euros in
2022, from 422.9 mln a year earlier
** The stock is on track for its worst day since Jan. 10
($1 = 0.9474 euros)
(Reporting by Olivier Sorgho)
((Olivier.Sorgho@thomsonreuters.com))