Monbat reveals 5y strategy and revises its budgeting (POSITIVE)
At an investors’ meeting yesterday Monbat updated on mid- and long-term strategic plans for organic and strategic growth. So far YTD sales were up 17.5% YoY and the expected full-year results are for 11.5% YoY increase in revenue and an EBITDA in the EUR 18.9m-19.6m range (+32% YoY). The five-year plan of the company is to add EUR 16.9m to the EBITDA organically and EUR 28m with strategic projects. The key drivers for the improved performance in the key segments (batteries & recycling) include market diversification and technology improvement targeting cost-effectiveness; predictable LME also contributed to the results. The group is working up to capacity and immediate plans are focused on expanding production in the Dobrich-based unit. According to the management, despite the delay of around 8 months, the EAS batteries project is on the right track. The target markets for these high power cells are marine, mining and aerospace. Another project Monbat Group will focus on is the manufacturing of 48V Bi-polar batteries. Upon finalization of pre-production stage, the group intends to build a factory with 250k production capacity (with the option to upgrade it to 500k). This new product will be a higher-margin substitute of the stationary battery products group. BoD also revealed that they have started negotiations for the acquisition of another Tunisian battery manufacturing company with an EBITDA of 2.1m. The latter has 1m batteries production capacity that would significantly relieve Monbat’s current capacity stretch. The plan is to close the deal in Q1'20; deal estimated value is up to EUR 10m.
At an investors’ meeting yesterday Monbat updated on mid- and long-term strategic plans for organic and strategic growth. So far YTD sales were up 17.5% YoY and the expected full-year results are for 11.5% YoY increase in revenue and an EBITDA in the EUR 18.9m-19.6m range (+32% YoY). The five-year plan of the company is to add EUR 16.9m to the EBITDA organically and EUR 28m with strategic projects. The key drivers for the improved performance in the key segments (batteries & recycling) include market diversification and technology improvement targeting cost-effectiveness; predictable LME also contributed to the results. The group is working up to capacity and immediate plans are focused on expanding production in the Dobrich-based unit. According to the management, despite the delay of around 8 months, the EAS batteries project is on the right track. The target markets for these high power cells are marine, mining and aerospace. Another project Monbat Group will focus on is the manufacturing of 48V Bi-polar batteries. Upon finalization of pre-production stage, the group intends to build a factory with 250k production capacity (with the option to upgrade it to 500k). This new product will be a higher-margin substitute of the stationary battery products group. BoD also revealed that they have started negotiations for the acquisition of another Tunisian battery manufacturing company with an EBITDA of 2.1m. The latter has 1m batteries production capacity that would significantly relieve Monbat’s current capacity stretch. The plan is to close the deal in Q1'20; deal estimated value is up to EUR 10m.
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