Financials: Mid-term guidance confirmed
Consus announced that the EBITDA (PPA) reform (excluding non-recurring expenses) in the 18th financial year was $ 204 million, a significant level of € 253 million. Management has confirmed that it aims to have an adjusted EBITDA of 450 million by 2020, which means job creation in the following areas. According to the chairman, the revenue stream should play a major role in improving performance, with the company’s average credit adjusted to the standard EITITDA resolution of 3.0x (vs. 8.3xi for the FY18 format). In addition, debt repayment plans should offer significant benefits from the 20th financial year onwards.
Successful forward-sale strategy boosts cash flows
By the end of 2018, the company had already sold 2.5 billion NPV projects, representing 24% of total revenue. This includes letters of intent (LOI) that have been signed or forwarded. This meant advances of EUR 356 million, resulting in a good return of EUR 132 million. In the 119th quarter, Consus completed three-thirds of its sales, with an NPV of 170 million, and is negotiating two more LOIs. Two transactions were made to restructure the business environment and reduce credit costs.
Valuation: Discount implied by bottom-line growth
The inflation rate compared to the current definitive consensus was translated into a P / E value of 34% in the 19th financial year, from 35% and a 45% decline in prices in the 20th and 21st financial years. Based on EV / EBITDA estimates for the 20th and 21st financial years, Consus generally trades in the same way as its counterparts. The difference in the P / E level may be related to a higher level of consensus than the average market.