Reway Group S.p.A.

8/03/2023

On 6 March 2023 Reway Group S.p.A. announces that it has received from Borsa Italiana the order for the admission of the Company’s Ordinary Shares and Warrants on “Euronext Growth Milan”, a multilateral negotiations system organized and managed by Borsa Italiana. Negotiations began on 8 March 2023.

The total equivalent of the resources collected through the placement is equal to Euro 20 millions.

The enterprise Reway Group S.p.A. società a capo del più grande Gruppo italiano specializzato nelle opere di risanamento e manutenzione di infrastrutture stradali e autostradali, opera per numerose realtà tra cui i tre principali operatori autostradali italiani (A.N.A.S, Autostrade per l’Italia e Gruppo ASTM).

Last research Reway Group S.p.A.

UPDATE

In 2024, Reway Group recorded strong growth results, with a value of production of € 232.32 million, up 75.6% compared to the previous year, driven by the acceleration in new contracts and the contribution of railway restoration activities. EBITDA amounted to € 42.63 million (+61.3%), with a margin of 18.8%. EBIT reached € 32.61 million (+46.9%), while net income rose to € 17.89 million (+22.6%). Net financial position shifted from a debt of € 34.61 million to a debt of € 66.97 million due to the acquisitions of Gema and Vega. The order backlog exceeded € 1,044.00 million, supported by significant contracts in the railway and road sectors worth over € 450.00 million, consolidating Reway’s position as a national leader in infrastructure restoration.

In light of the results published in the FY24A annual report, we are revising our estimates for the current year as well as for the coming years. Specifically, we now estimate a FY25E value of production of € 255.50 million and an EBITDA of € 49.60 million, corresponding to a margin of 19.4%. For the following years, we expect the value of production to increase to € 287.50 million by FY27E (CAGR 24A–27E: 7.4%), with an EBITDA of € 62.20 million, corresponding to a margin of 21.8%, up from € 42.63 million in FY24A (EBITDA margin: 18.8%). On the balance sheet side, we estimate a net financial position of € 10.87 million for FY27E, showing a strong improvement compared to the € 66.97 million recorded in FY24A, thanks to the progressive generation of operating cash flow. We conducted Reway Group’s equity valuation using both the DCF method and a market multiples approach based on a peer group. The DCF method (which, for prudential purposes, includes a 1.0% specific risk in the WACC calculation) yields an equity value of € 351.5 million. The equity value based on market multiples stands at € 331.8 million. The resulting average equity value is approximately € 341.7 million. The target price is € 8.80, with a BUY rating and a MEDIUM risk profile.