| The value of production amounted to € 13.21 million, compared to € 10.85 million recorded at the end of 2022, and € 14.60 million estimated in our previous report. EBITDA, equal to € 3.19 million, saw an increase of 62.5% compared to € 1.96 million in the previous year, and came in slightly better than our expectation of € 3.10 million. The EBITDA margin, equal to 24.1%, came in higher than both the previous year’s figure (18.1%) and our estimate (21.2 %). EBIT, after depreciation and amortization of € 1.14 million, stands at € 2.05 million (€ 1.00 million in FY22A). Net Income amounted to € 1.68 million, marking a relevant growth of 101.8% compared to € 0.83 million in FY22A. In light of the results published in the annual report for FY23A, we have adjusted our estimates for both the current year and the following years. In particular, we now estimate an FY24E value of production of € 15.70 million, and an EBITDA of € 3.80 million, corresponding to a margin of 24.2%. In the following years, we expect the value of production to reach € 26.00 million (CAGR 23A-27E: 18.4%) in FY27E, with EBITDA equal to € 6.40 million (corresponding to a margin of 24.6%), up from € 3.19 million in FY23A (corresponding to an EBITDA margin of 24.1%). We conducted our valuation of the equity value of Circle based on the DCF method and multiples of a sample of comparable companies. The DCF method (including, for prudential purposes, a specific risk of 2.5% in the calculation of the WACC) returned an equity value of € 31.5 million. Using market multiples, the equity value of Circle was calculated as € 33.0 million (including a 25.0% discount). The result is an average equity value of approximately € 32.2 million. The target price is € 8.00, with a BUY rating, and MEDIUM risk. |