Belgium's Bekaert slips as outlook points to slimmer margin

NV Bekaert SA

18/11/2022 09:50

** Shares in Bekaert  BEKB.BR  edge down around 1% as the
Belgian steel wire maker's full-year outlook suggests weakening
margin in the second half of the year
    ** Bekaert anticipates FY underlying EBIT of 450-460 million
euros ($466-$476 million), and a margin dilution impact of
zero-margin cost inflation pass-through of around 150 basis
points
    ** Its consolidated sales rose 17.9% to 1.48 billion euros
in Q3
    ** The update shows a strong beat on Q3 sales but a light
warning on FY underlying EBIT, ING analyst Stijn Demeester says
    ** Oddo BHF's Martijn den Drijver says the mid-point of EBIT
guidance implies an 8.0% margin, below consensus
    ** The broker is also unsure what to read into the lack of
net debt figure in the Q3 update
    ** "But we assume that the high inventory of raw materials,
a slower than expected sell out in units and perhaps adverse
accounts receivables developments have impacted net working
capital and thus net debt" - Oddo BHF
    ** Bekaert expects the challenging demand environment to
continue in Q4, particularly in Latin America and EMEA, analysts
note
($1 = 0.9656 euros)
 (Reporting by Dagmarah Mackos)
 ((dagmarah.mackos@thomsonreuters.com))