Seguimiento de Babcock International (BAB)

Buena recuperación estas últimas semanas de Babcock ya por encima de 300

Situación complicada de Babcock

Jan 15 (Reuters) - Babcock shares plunged almost 20% on Friday after the British engineer said it was reviewing the profitability of its contracts and its finances might take a hit as a result.

It said the review was being supported by an independent accounting firm and the results would be assessed by its auditor PwC, audit committee and board before its annual results announcement, expected in May.

It did not say what led it to launch the review, but added the results could affect either just the current financial year or potentially also future years.

Babcock brought in a new CEO and finance chief last year as it dealt with a slowdown in most of its markets due to the COVID-19 crisis and higher costs related to that. [nL4N2A529F]

For the first nine months of the current financial year, underlying operating profit slumped to 202 million pounds ($276 million) from 320 million pounds a year earlier, it said.

Its order book at the end of 2020 was 16.8 billion pounds versus 17.6 billion pounds at the end of March.

"Trading in the third quarter saw a continuation of trends in the first half of the year, with weakness in our civil aviation businesses and a negative impact from COVID-19," Babcock said.

The company has contracts in the aerospace, defence, emergency services and civil nuclear sectors and counts Britain's Ministry of Defence as its biggest customer.

JP Morgan analysts, who have a "neutral" rating on the stock, cut their earnings estimate for the company for the current and next two financial years by as much as 9%.

"Q4 21 (Jan-Mar 2021) looks very challenging, as the latest wave of COVID-19 is having a bigger impact than we thought," they wrote in a note.

Muy buenas compañeros, he estado mirando la nota de prensa que hoy ha publicado Babcock. Apuntan unas caída del 3% de los ingresos  y del beneficio operativo un 34% con respecto al mismo período del 2019 respectivamente. 

No obstante, debemos considerar la excepcionalidad de estos resultados fruto de la pandemia. Por lo tanto, incluso admitiendo que los beneficios operativos declarados en 9M son 202 millones de libras (no sería raro que terminasen el año fiscal 2021 con unos ingresos cercanos a los 250 millones de libras), es una barbaridad que esta empresa capitalice 1,1bn de libras. Todo esto contando con que este año ha sido un desastre. En un año normal, y cotizando a múltiplos "normales" o "medios históricos", esta empresa debería capitalizar 4 - 4,5bn de libras cómodamente.

Sinceramente, me parece una ganga. Más si cabe teniendo contratos firmados a tan largo plazo.

El problema es el riesgo de que te hagan una ampliación de capital. Pasaba lo mismo con Meliá, o con Unibail, por ejemplo. La valoración era ridícula, pero si te hacen ampliación con la cotización tan baja, te diluyen mucho, y se acaba el potencial.
Creo que en Babcock pasa lo mismo. Tiene un nuevo CEO que todavía no ha definido su estrategia, después de unos cuantos meses. Y seguramente, querrá dejar limpias las cuentas en su primer año de gestión. 

Babcock International Group PLC ("Babcock" or "the Group") issues the following update for the financial year ending 31 March 2021 (FY21) including an update on reviews currently taking place and our headline unaudited results. This announcement is being made ahead of the Group's Preliminary Results announcement to provide some early transparency on key issues.

 

Note: these are subject to the finalisation of our reviews and the year end audit

·    Babcock will focus on being an international aerospace, defence and security company with a leading naval business and providing value add services across the UK, France, Canada, Australia and South Africa

·   The contract profitability and balance sheet review ("CPBS") has identified impairments and charges totalling approximately £1.7 billion

·      The vast majority of the impact of the CPBS is one-off in nature and non-cash affecting

·   The CPBS is expected to result in an ongoing reduction in Group underlying operating profit of approximately £30 million each year

·    We are changing our operating model to simplify the business and reduce layers. The consequential restructuring will have a one off cash cost of approximately £40 million and is expected to deliver realisable annualised savings of approximately £40 million. The benefit in FY22 will be roughly half this due to timing

·    We will rationalise the Group's portfolio by divesting certain businesses. We anticipate this will generate proceeds of at least £400 million over the next twelve months

·   Draft unaudited management results show FY21 underlying revenue of £4,690 million (FY20: £4,872 million) with underlying operating profit of £307 million (FY20: £524 million) before CPBS impacts. These results include our share of joint ventures and associates (note 1)

·      Net debt (excluding lease obligations) at 31 March 2021 was £750 million, with an estimated net debt to EBITDA ratio of 2.5 times

·    We have confidence that the markets we address and our capabilities to address those markets will be favourable in the medium term. However, we will be revising our forecasts for profitability for future periods as we continue to assess the business. We are cautious about progress in FY22 profitability as it will be a year of transition

·      We aim to return Babcock to strength without the need for an equity issue

We will set out further details of the above at our Preliminary Results, the publication of which is likely to be delayed as a result of COVID-19 working constraints and the large number of potential adjustments under consideration in our CPBS. We will prioritise quality of reporting over speed.

 

¿One-off? Claro que sí, guapi. Empresa dañada de muerte por la reducción de gasto militar de UK. Están recortando costes de forma brutal (personal, aeronaves, filiales) lo que les hará perder más capacidad. El intento de entrar en otros mercados les va a ser muy complicado siendo un sector estratégico como el de la defensa. Han entrado en una espiral de destrucción de valor de la que parece complicado que puedan salir a corto o medio plazo sin un aumento del gasto militar de UK.

Nuevos resultados, nuevo "one-off":  reported a bigger annual loss after taking charges and impairments of 2 billion pounds ($2.79 billion) following a review of its contracts and balance sheet.

Y cuando el río suena, agua lleva:  "We have a plan in place to strengthen the group without the need for an equity issue," said Chief Executive David Lockwood.