Elior drops after lowered margin guidance

Elior SA

17/05/2023 08:26

** Shares in Elior  ELIOR.PA  fall 16% after the French
caterer lowered its full-year EBITA margin and forecast a volume
slowdown in H2 as inflation weighs
    ** J.P. Morgan points to a mixed set of H1 results, with
revenue and EBITA broadly in line with its estimates, free cash
flow still in negative territory and cautious guidance
    ** "The new guidance will likely trigger around 10% EBITA
downgrades for FY 23 and new FY 24 targets will now only be
presented at the FY 23 results in November", the broker adds
    ** Elior said the margin for adjusted earnings before
interest, taxes and amortisation (EBITA) for 2022-23 financial
year would be at the lower end of its initial range of 1.5% to
2%
    ** "The drop of over 16% to under 3.30 euros should be
rather explained by speculations as no major surprises have been
provided in the H1 results released", Alphavalue analyst Yi
Zhong says
    ** She notes Elior's share price rose by 19.5% from 3.23
euros on May 8 to 3.86 euros on May 16
    ** The stock sits at the bottom of France's SBF 120
 .SBF120  index

 (Reporting by Federica Mileo)
 ((Federica.mileo@thomsonreuters.com))