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Research, Update 8 Dec 2022

UPDATE – 13.10.2022

The Group, in the consolidated half-year financial report as of 30 June 2022, reported that it had generated revenues of € 14.35 million, compared to a value of € 9.18 million in the first half of last year, showing an increase of 56.3%. Adj. EBITDA, equal to € -0.99 million, recorded a slight contraction compared to € -0.85 million in the first half of 2021. EBIT amounted to € -1.35 million, while in the first half of 2021 it amounted to € -1.14 million. Net income amounted to € -0.91 million, essentially in line with the value of € -0.92 million in the first half of last year. The NFP amounted to € 5.75 million, a worsening compared to 31 December 2021 (equal to € 3.53 million).

In the light of the results published in the half-yearly report for 1H22A, we modify our previous estimates both for the current year and for the coming years. In particular, we estimate FY22E revenues of € 32.00 million and EBITDA Adj. of € -0.30 million, corresponding to a marginality of -0.9%. For subsequent years, we expect the revenues to increase up to € 50.00 million (CAGR 21A-25E: 17.4%) in FY25E, with EBITDA Adj. of € 3.80 million (corresponding to an EBITDA Adj. margin of 7.6%), up from € -0.45 million in FY21A (corresponding to an EBITDA Adj. margin of -1.7%). 

We have conducted the valuation of L&C’s equity value based on the DCF methodology. For prudential purposes, we have included a specific risk of 2.5%. This results in a WACC of 6.80%. With the above data and taking as a reference our estimates and assumptions, the result is an equity value of € 25.3 million. The target price is, therefore, € 4.05 (prev. € 4.30), BUY rating and MEDIUM risk. 

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