Masterflex SE — Earnings Release 2016

Apr 7, 2016

Masterflex SE April 7, 2016 P. 1 WGZ BANK RESEARCH

Newsflash

Masterflex SE 3) 4) April 7, 2016

Recommendation:	Buy			Company data
before:	-	as of	-	Sector	Industry
Target price (EUR)	7.00			Market segment	Prime Standard
Share price (Xetra) (EUR)	5.71			ISIN	DE0005492938
04/06/16 5:26 PM				Reuters	MZXG.DE
Share price potential	23%			Bloomberg	MZX

Improvement of EBIT margin is the focus in 2016

• ^Q Masterflex´ sales development was only moderate in 2015: +2.6% to EUR64.1m (62.5; our forecast: 64.4). The 2015 EBIT decreased to EUR4.9m (6.3; our forecast: 5.8; especially low topline dynamics and one-off items (especially optimisation in the personnel area)). The EBIT margin fell to 7.6% (10.1%) in 2015.
• ^Q The comments made during today´s analyst conference have substantiated our forecasts for 2016: sales growth of 3.2% (Masterflex target: >+2.9%); EBIT of EUR6.3m (Masterflex target: clearly over 4.9), which corresponds to an EBIT margin of 9.5% (no special items; first success of the initiated measures such as the in-house cost reductions, optimisation of product portfolio as well as efficiency enhancement in production and warehouse). In 2017 with a sales growth of 3.5% we expect an EBIT margin of 10.1% (Masterflex target: double-digit in 2017 the latest).
• ^Q We confirm our Buy recommendation (anticipated increase of profitability by optimisation and efficiency enhancement programme; attractive 2016 valuation; mid-term growth perspectives especially in North America) with an unchanged price target of EUR7.00.

	2012	2013	2014	2015	2016E	2017E
Gross revenue	55.0	57.9	62.5	64.1	66.2	68.5
Growth in revenue	3.7%	5.3%	7.9%	2.6%	3.2%	3.5%
EBIT	7.6	6.1	6.3	4.9	6.3	6.9
EBIT margin	13.7%	10.6%	10.1%	7.6%	9.5%	10.1%
Net income	3.4	2.6	3.0	1.9	3.1	3.5
Net margin	6.3%	4.5%	4.9%	3.0%	4.8%	5.1%
EPS	0.39	0.29	0.34	0.22	0.35	0.39
DPS	0.00	0.00	0.00	0.00	0.00	0.00
Net financial debt / EBITDA	2.0	2.2	1.8	2.1	2.0	1.9
Net gearing	1.1	0.8	0.7	0.6	0.7	0.6
Free cash flow (FCF)	0.9	4.0	3.0	-0.6	-2.5	2.7
FCF per share	0.10	0.45	0.34	-0.07	-0.28	0.30
EV/sales	1.2	1.2	1.2	1.2	1.1	1.0
EV/EBITDA	6.2	7.7	8.5	9.7	7.6	7.0
EV/EBIT	8.4	11.0	12.3	15.3	11.3	10.3
EV/FCF	57.6	16.0	25.6	-106.1	-29.0	25.4
P/E	13.1	19.1	20.4	30.0	16.1	14.6
P/B	2.4	2.3	2.6	2.2	1.7	1.6
Dividend yield	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

Figures in EURm except EPS, DPS and FCF per share (EUR); source: Masterflex SE, own estimates Authors: A. Vashkevich, S. Röhle (analysts)

Share data
Shares (m)	8.866
Freefloat	51.9%
Market cap. (EURm)	50.6
∅ Trading volume (shares)	2,855
52W High 08/19/2014	EUR7.41
52W Low 10/16/2014	EUR5.45
Events
Q1 results	05/09/16
General Meeting	06/14/16
Performance
	absolute	relative to
		DAX
1M	1.0%	3.0%
3M	-1.6%	2.4%
6M	-9.5%	-5.9%
12M	-20.6%	0.3%

Index weighting

No index membership

Source: Bloomberg

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