DAY: Positive LFL Iberia, stability margins, negative currency impact

DAY: Positive LFL Iberia, stability margins, negative currency impact



Second quarter results in stock once our estimates at the full of beans level. LFL exaggerate the benefit of Iberia, which returns to the certain trend in 2T16 + 2% (+ 2.5% vs. -1.4% 2T16 4T15 1T16 e), as soon as significant underlying shape on (eg calendar and former cannibalization + 2.1% vs. + 0.4% 2T16 1T16 4T15 and + 0.2%).

In terms of margins, the continued stability despite the dilution effect in the Iberian Peninsula by recent acquisitions and investments in prices in Portugal, thanks to a athletic cost base and certain impact of the higher weight of franchisees, and cause offense yet to be payment in emerging. The impact of the dispute rate remains remarkably negative (-34.5% a.i.). However, sales greater than before slightly + 0.3% + 1.8% EBITDA mount taking place (thanks to improvements in Iberia revenues) to 150.4 million euros and net profit fell 5.5% due to increased purchases writedowns and the financial consequences of emerging countries.

2T16 Sales + 0.3% (-0.1% vs R4e) and EBITDA + 1.8% (+ 1.9% vs R4e). Margin of 10 bp 14 bp vs. estimated affected by recent acquisitions in Iberia and investment in prices in Portugal, but supported by Emergent.

In Iberia there is the remarkable go ahead in LFL, upsetting into true territory approaching + 2% (vs + 2.3% and -1.4% R4e 2T16 1T16 4T15 and in), meeting the try set for the year prematurely to accomplish final territory the 2T16. Excluding the unconditional directory (+ 1.2% vs + 1.3% 2T16 R4e) In fact, we continue to see completely significant underlying improvements: LFL ex-directory and former cannibalization 2T16 + 2.1% (vs + 0.4 1T16 4T15% and + 0.2%), confirming the highly developed recovery of the LFL (supreme inflation in its production basket, far-off afield along desertion of cannibalization effect, the favorable impact of remodeled stores, reduced brake force). The EBITDA margin of 8.7%, in heritage when our estimates (8.8% R4e) due to the dilution effect of the captivation of Eroski stores. Looking ahead to 2016, reflecting stable margins Iberia throughout the year at in bank account to 8.8%, where the effect of dilution of Eroski stores will be more noticeable during the first allocation of the year.

Emerging: meet our estimates, continuous press on in LFL in 2T16 + 18% (vs + 20% 2T16 R4e, + 1T16 15% and + 9% 4T15) supported by the acceleration of inflation in Brazil and Argentina, although the contribution of the argument rate will remain negative -35pp (-44pp vs 1T16 and 4T15 -15pp, the devaluation of the Argentine late addition, the Brazilian genuine and the Chinese yuan). However, there was a subside in sales of -5.5% (-8% vs. R4e). Excluding the effect of currency would obtain some of + 28% heavens (+ 24.5% vs. 1T16). In terms of margins, we observed a outrage enlarge on vs. 2T15 (+12 bp), although continuous build happening.

Net debt rose to 1.124 billion euros in 2T16 (1.8x ND / EBITDA) 1.167 billion euros vs 1T16 (1.9x ND / EBITDA). The cash generation in 1H16 is in lineage bearing in mind the targets set for 2016-2018.

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