06.09.2017

Zugemailt von / gefunden bei: Baader Helvea (BSN-Hinweis: Lauftext im Original des Aussenders, Titel (immer) und Bebilderung (oft) durch boerse-social.com aus dem Fotoarchiv von photaq.com)

    On 19 September voestalpine will present its automotive strategy in Frankfurt. In the last year 2016/17 (April-March) voestalpine generated 34% of its total sales with the automotive industry. The presentations will be held by the group CEO Mr. Eder, the Head of the Steel Division, Mr. Eibensteiner and the Head of the Metal Forming Division, Mr. Schwab. Furthermore the president of MAGNA Europe will make a keynote speech.

Our conclusion

    This CMD is another option for the management to highlight the strength of the product portfolio. Especially in the light of the current discussion concerning upcoming structural changes in the automotive industry. We think that voestalpine is well positioned to generate also above average margins in the future.

    We stick to our Buy rating, especially before the years of rising FCF and a high probability for a special dividend. The EBIT consensus increased during the last weeks from approx. EUR 980mn above EUR 1bn. They gave no concrete guidance after the 1Q report on 9 August and pointed to the fact that there are still some uncertainties when it comes to prices development or the USD. However, that quarter confirmed that the management has implemented the right strategy and that the high investments in the past start to deliver their required share of profits.

    The FCF is intact. The FCF guidance for this year is EUR 200-300mn, including the working capital build-up of up to EUR 300mn for the relining of the big blast furnace in summer 2018.It will affect approximately 1mn tons. This will reverse with the sale of the products during 2018, meaning everything else equal, and FCF can reach EUR 800mn in 2018/19. We think that discussions concerning the question how to use the funds going forward will intensify in the quarters to come. M&A will play a minor role because of high multiples. But extra dividend or a share buyback might be an option.

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voestalpine

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