German Small Caps in 2016 - Leifheit...

German Small Caps in 2016 Cloudy with sunny spells

28/01/2016

BANKHAUS LAMPE // 2

CONTENTS 2

EXECUTIVE SUMMARY – CLOUDY WITH SUNNY SPELLS 4

STOCK PICKING BECOMING MORE IMPORTANT 9

COMPANY PROFILES 15

Adler Modemärkte AG 16

Ahlers AG 22

AIXTRON SE 28

Amadeus FiRe AG 34

Bastei Lübbe AG 40

BAUER Aktiengesellschaft 46

BayWa AG 52

Borussia Dortmund GmbH & Co. KGaA 58

Capital Stage AG 64

CEWE Stiftung & Co. KGaA 70

CHORUS Clean Energy AG 76

comdirect bank AG 82

DATRON AG 86

Delticom AG 92

Deutz AG 98

DIC Asset AG 104

euromicron AG 110

Evotec AG 116

Gerry Weber International AG 122

Gesco AG 128

GfK SE 134

Grammer AG 140

Hawesko Holding AG 146

Koenig & Bauer AG 152

Leifheit AG 158

LPKF Laser & Electronics AG 164

Manz AG 170

Masterflex SE 176

MLP AG 182

Contents

PUMA SE 186

QSC AG 192

R. STAHL AG 198

Schaltbau Holding AG 204

SGL CARBON SE 210

SHW AG 216

SÜSS MicroTec AG 222

technotrans AG 228

TOM TAILOR Holding AG 234

Tomorrow Focus AG 240

VIB Vermögen AG 246

Villeroy & Boch AG 252

Wacker Neuson SE 258

WashTec AG 264

windeln.de AG 270

SCREENING TABLES 276

THE AUTHORS 283

DISCLAIMER 284

CONTACTS 295

BANKHAUS LAMPE // 3

BANKHAUS LAMPE // 4

German Small Caps in 2016 - Cloudy with sunny spells 28/01/2016

Executive Summary Cloudy with sunny spells

For 2016 we highlight our top seven small-cap BUY recommendations for which we

assume that the strength of the business model, the strategic positioning and not

least the qualities of the management team suggest a positive performance

regardless of macro-economic uncertainties. This portfolio is not only geared

towards yield potential, it also includes a risk assessment and is therefore

diversified. We augment this portfolio with three SELL recommendations for

companies where we perceive the greatest downside potential.

STOCK PICKING BECOMING MORE IMPORTANT

Since the start of the bull market in 2009, small-and-mid caps have beaten the

large caps driven by share price gains across the whole equity market. However, the

overall picture is likely to reverse in 2016. Investors should overweight large caps.

The status quo in many portfolios is probably the opposite. Up to now, investors have

placed their faith in the faster growth and takeover speculation available with small

caps. Now, however, investors will have to be more selective when picking small-and-

mid caps.

MAIN SMALL-CAP RECOMMENDATIONS

At the following companies, we see significant up/downside with clear company-

specific catalysts:

In line with our strategy, our top picks focus on defensive stocks. These include:

Capital Stage, Cewe Stiftung and Leifheit. DIC Asset represents the real-estate

sector. Evotec illustrates a special situation. Grammer and QSC round off the list.

We still perceive risks for SGL Carbon. Due to weak business with graphite

electrodes for steel production, we still expect it to make losses. We also have a

negative stance with regard to Hawesko due to the valuation and the unclear share

price drivers. Due to the structural weaknesses it faces, we are not positively

disposed towards Delticom either.

28/01/2016

Christoph Schlienkamp, Investmentanalyst DVFA

Phone: +49 (0)211 4952-311

[email protected]

Top BUY recommendations in the

small-cap sector

Top SELL recommendations in the

small-cap sector

Company Bloomberg

Recommendat

ion

Previous

Recommend.

Price

Target

Previous Price

Target

Close Price

25.01.2016

EPS

2016E

DPS

2016E

CEWE Stiftung & Co. KGaA CWC Buy Hold 60.00 EUR 60.00 EUR 48.51 EUR 3.69 EUR 1.65 EUR

Capital Stage AG CAP Buy Buy 10.60 EUR 10.60 EUR 7.56 EUR 0.51 EUR 0.25 EUR

DIC Asset AG DIC Buy Buy 10.50 EUR 10.50 EUR 8.70 EUR 0.65 EUR 0.35 EUR

Delticom AG DEX Sell Hold 16.00 EUR 22.00 EUR 18.20 EUR 0.92 EUR 0.50 EUR

Evotec AG EVT Buy Buy 4.60 EUR 4.60 EUR 3.47 EUR 0.02 EUR 0.00 EUR

Grammer AG GMM Buy Buy 32.00 EUR 32.00 EUR 26.70 EUR 2.89 EUR 0.80 EUR

Hawesko Holding AG HAW Sell Sell 37.00 EUR 37.00 EUR 40.34 EUR 1.94 EUR 1.00 EUR

Leifheit AG LEI Buy Buy 60.00 EUR 60.00 EUR 46.13 EUR 3.01 EUR 2.10 EUR

QSC AG QSC Buy Buy 2.20 EUR 2.20 EUR 1.55 EUR -0.02 EUR 0.06 EUR

SGL CARBON SE SGL Sell Sell 8.00 EUR 9.00 EUR 8.81 EUR -0.34 EUR 0.00 EUR

Source: Company information, Bankhaus Lampe Research estimates

BANKHAUS LAMPE // 5


Our universe includes German companies with a free float market capitalisation of

less than € 500 m (as per: 31/12/2015) that are part of our coverage. This

compilation is supplemented with eight further stocks. Although only some of these

qualify as BUY ratings, they should offer upside potential in the medium term.

TOP BUY PICKS

Capital Stage (BUY, € 10.60, upside potential 40%)

The business model generates steady and reliable revenues with attractive yields

independent of the economic conditions. In light of the company’s strong

acquisition pipeline, we expect to see steady positive newsflow. Our price target is

based on the current portfolio. This also applies to the company’s own guidance.

Acquisitions should lead to a systematic uptrend in the company’s business

projections.

Cewe Stiftung (BUY, € 60.00, upside potential 24%)

The 2015 results should be well received by the market, all the more so as they

suggest the dividend may well be increased. Strategically speaking, Cewe is on

course to grow via value-added products and therefore decouple positively from the

market trend. After a weak phase in mid-2015, the Online Print business recently

regained momentum and should continue to grow this year. In this regard, we

primarily see additional opportunities arising from the increased demand for print

products generated by major sporting events, such as the UEFA European

Championship or the summer Olympics.

DIC Asset (BUY, € 10.50, upside potential 21%)

DIC Asset is trading at a discount of more than 30% to its NAV. However, the

company has substantially reduced one of the reasons for this, i.e. the high debt

level. It will therefore probably reach the YE 2016 target of 60% early and

ultimately undercut it quite appreciably. In a phase of ongoing consolidation, the

company will therefore be in a much better position.

Evotec (BUY, € 4.60, upside potential 33%)

Evotec’s hybrid business model (a self-financing biotechnology company) makes it

the sector’s "safe haven". In our view, the latest share price setbacks to the level hit

in mid-2015 after the announcement of the failure of EVT302 represent an excellent

opportunity to buy into the stock. In the meantime, the company has signed a raft

of new collaborations, some of which are extensive, e.g. with Pfizer, Sanofi, UCB,

academic research facilities), and all of the critical pre-clinical milestones (Bayer,

Janssen) have been achieved. We assume that following an estimated 45% growth

in 2015, Evotec will increase its revenue (excl. milestone payments) by at least 10%

in 2016E. The company consequently has considerable leeway to further expand its

portfolio of more than 70 partner projects. The current valuation implies, in our

view, that the market is not ascribing any positive value to the company’s

collaboration network. We do not share this view.

BANKHAUS LAMPE // 6


Grammer (BUY, € 32.00, upside potential 20%)

Thanks to major orders won in recent years (order intake in the Automotive segment

of € 1.2 bn in both 2014 and 2015), Grammer is likely to generate appreciable

revenue growth in the years ahead. We therefore believe this can easily compensate

for the weakness in the Seating Systems segment (truck market in Brazil and

agricultural machinery). Since in 2016 the one-off expenses from a) the structural

adjustments in seat production and b) the plant consolidation in the Czech Republic

should not be incurred again (BHLe ~ € 10 m), we expect to see substantial earnings

growth potential this year. In addition, Grammer acquired Reum (revenue

contribution of € 130 m BHLe). We believe that the improvement in the horizontal

value-added chain came at a cheap purchase price multiple (EV/sales of close to

0.5x).

Leifheit (BUY, € 60.00, upside potential 30%)

In 2015, sales and earnings should have performed better than recently expected. In

our view, this is the positive outcome of the “Leifheit 2020” strategy implemented

more than a year ago. Growth in the Brand Business, a healthy balance sheet, and

strong dividends coupled with the prospect of further dividend increases in the next

few years are the key arguments that persuade us to confirm our BUY rating with an

unaltered price target of € 60.00.

QSC (BUY € 2.20, upside potential 42%)

We believe that QSC will re-invest most of the cost savings achieved in 2015 in

developing its own cloud platform in FY 2016. This should negatively affect the

EBITDA vs. 2015, which will only grow marginally. But it will lay the foundation for

future growth. The market for cloud applications, particularly in the core target

group of German SMEs, is still in its infancy. It offers the prospect of years of

growth. QSC’s existing traditional IT outsourcing business for German SMEs should

put it in a good position to benefit from the trend towards the virtualisation of

business processes. At the same time, it should cut the company’s dependence on

the shrinking traditional telecoms business. We confirm our BUY rating in view of a

positive growth outlook for IT services, moderate valuation multiples and

consolidation opportunities.

TOP SELL PICKS

Delticom (SELL, € 16.00, downside potential -12%)

The trend from offline to online gives Delticom structural support. Nonetheless, the

competitive environment remains difficult, because the European tyre market is

hardly growing structurally, the entry barriers for online tyre retail are low and the

key advantage of an e-commerce business model – the elimination of bricks-and-

mortar retail – is only partially effective as the customer almost always requires a

garage for a tyre change. High logistics costs could also mean that greater unit sales

do not always lead to higher earnings.

Hawesko (SELL, € 37.00, downside potential -8%)

In our view, Hawesko is still undergoing a transformation phase. The new CEO

Thorsten Hermelink joined the company at the start of the year. However, we do not

BANKHAUS LAMPE // 7


expect to see any major change in strategy that would require us to reassess the

stock before mid-April.

SGL Carbon (SELL € 8.00, downside potential -9%)

Due to weak business with graphite electrodes for steel production, SGL Carbon is

still making losses. As a result, we expect the share price to keep falling, and we

reiterate our SELL rating.

BANKHAUS LAMPE // 8


Overview: German Small Caps

Company Bloomberg Recommendation Previous Rec.

Price Target

Previous Price Target

Close Price 25.01.2016

EPS 2016E

DPS 2016E

Adler Modemärkte AG ADD Hold Hold 10.00 EUR 10.00 EUR 9.12 EUR 0.95 EUR 0.50 EUR

Ahlers AG AAH3 Hold Hold 8.50 EUR 9.00 EUR 7.30 EUR 0.36 EUR 0.35 EUR

AIXTRON SE AIXA Hold Hold 4.00 EUR 6.00 EUR 3.51 EUR -0.15 EUR 0.00 EUR

Amadeus FiRe AG AAD Hold n.a. 73.00 EUR n.a. 67.42 EUR 3.43 EUR 3.43 EUR

Bastei Lübbe AG BST Buy n.a. 8.50 EUR n.a. 6.98 EUR 0.65 EUR 0.33 EUR

BAUER Aktiengesellschaft B5A Hold Hold 16.00 EUR 19.00 EUR 14.39 EUR 1.40 EUR 0.40 EUR

BayWa AG BYW6 Hold Hold 32.00 EUR 36.00 EUR 27.53 EUR 1.93 EUR 0.90 EUR

Borussia Dortmund GmbH BVB Buy Buy 5.00 EUR 5.00 EUR 3.93 EUR 0.07 EUR 0.05 EUR

Capital Stage AG CAP Buy Buy 10.60 EUR 10.60 EUR 7.56 EUR 0.51 EUR 0.25 EUR

CEWE Stiftung & Co. KGaA CWC Buy Hold 60.00 EUR 60.00 EUR 48.51 EUR 3.61 EUR 1.65 EUR

CHORUS Clean Energy AG CU1 Buy n.a. 12.00 EUR n.a. 9.50 EUR 0.67 EUR 0.20 EUR

comdirect bank AG COM Hold Hold 10.00 EUR 10.00 EUR 9.90 EUR 0.52 EUR 0.30 EUR

DATRON AG DAR Buy Buy 12.50 EUR 12.50 EUR 9.55 EUR 0.82 EUR 0.20 EUR

Delticom AG DEX Sell Hold 16.00 EUR 22.00 EUR 18.20 EUR 0.69 EUR 0.30 EUR

Deutz AG DEZ Hold Hold 3.50 EUR 3.50 EUR 2.99 EUR 0.01 EUR 0.07 EUR

DIC Asset AG DIC Buy Buy 10.50 EUR 10.50 EUR 8.70 EUR 0.65 EUR 0.35 EUR

euromicron AG EUCA Hold Hold 7.70 EUR 9.70 EUR 7.00 EUR 0.56 EUR 0.00 EUR

Evotec AG EVT Buy Buy 4.60 EUR 4.60 EUR 3.47 EUR 0.02 EUR 0.00 EUR

Gerry Weber International GWI1 Hold Hold 14.50 EUR 17.00 EUR 11.14 EUR 0.93 EUR 0.50 EUR

Gesco AG GSC1 Hold Hold 72.00 EUR 70.00 EUR 66.49 EUR 5.10 EUR 1.90 EUR

GfK SE GFK Buy Buy 43.00 EUR 45.00 EUR 26.42 EUR 2.66 EUR 0.70 EUR

Grammer AG GMM Buy Buy 32.00 EUR 32.00 EUR 26.70 EUR 2.89 EUR 0.80 EUR

Hawesko Holding AG HAW Sell Sell 37.00 EUR 37.00 EUR 40.34 EUR 1.94 EUR 1.00 EUR

Koenig & Bauer AG SKB Hold Hold 29.00 EUR 29.00 EUR 30.30 EUR 2.57 EUR 0.51 EUR

Leifheit AG LEI Buy Buy 60.00 EUR 60.00 EUR 46.13 EUR 3.01 EUR 2.10 EUR

LPKF Laser & Electronics LPK Buy Buy 8.50 EUR 9.00 EUR 6.93 EUR 0.13 EUR 0.05 EUR

Manz AG M5Z Hold Hold 40.00 EUR 45.00 EUR 29.96 EUR 0.03 EUR 0.00 EUR

Masterflex SE MZX Hold n.a. 6.00 EUR n.a. 5.50 EUR 0.42 EUR 0.00 EUR

MLP AG MLP Hold Hold 4.00 EUR 4.00 EUR 3.08 EUR 0.32 EUR 0.20 EUR

PUMA SE PUM Sell Sell 133.00 EUR 133.00 EUR 187.35 EUR 3.64 EUR 0.60 EUR

QSC AG QSC Buy Buy 2.20 EUR 2.20 EUR 1.55 EUR -0.02 EUR 0.06 EUR

R. STAHL AG RSL2 Hold Hold 29.00 EUR 29.00 EUR 31.16 EUR 1.26 EUR 0.50 EUR

Schaltbau Holding AG SLT Buy n.a. 55.00 EUR n.a. 50.35 EUR 3.89 EUR 1.10 EUR

SGL CARBON SE SGL Sell Sell 8.00 EUR 9.00 EUR 8.81 EUR -0.36 EUR 0.00 EUR

SHW AG SW1 Hold Hold 24.00 EUR 24.00 EUR 23.00 EUR 1.98 EUR 0.60 EUR

SÜSS MicroTec AG SMHN Hold Hold 8.00 EUR 6.00 EUR 8.47 EUR 0.31 EUR 0.00 EUR

technotrans AG TTR1 Buy Buy 20.00 EUR 20.00 EUR 17.26 EUR 1.18 EUR 0.59 EUR

TOM TAILOR Holding AG TTI Hold Hold 5.50 EUR 5.50 EUR 4.34 EUR 0.22 EUR 0.00 EUR

Tomorrow Focus AG TFA Hold Hold 3.90 EUR 3.90 EUR 3.13 EUR -0.06 EUR 0.00 EUR

VIB Vermögen AG VIH Buy Buy 19.50 EUR 19.50 EUR 16.72 EUR 1.34 EUR 0.55 EUR

Villeroy & Boch AG VIB3 Hold n.a. 13.00 EUR n.a. 12.48 EUR 1.06 EUR 0.50 EUR

Wacker Neuson SE WAC Buy Buy 16.00 EUR 16.00 EUR 12.26 EUR 1.05 EUR 0.40 EUR

WashTec AG WSU Buy n.a. 33.00 EUR n.a. 26.94 EUR 1.79 EUR 1.30 EUR

windeln.de AG WDL Hold n.a. 10.00 EUR n.a. 9.43 EUR -0.72 EUR 0.00 EUR

Source: FactSet, Bankhaus Lampe Research estimates

BANKHAUS LAMPE // 9


Stock picking becoming more important

There a few reasons that support our case that investors will have to be more

selective when picking small-and-mid caps: 1) a very volatile sideways market

(which favours large stocks) instead of a steady uptrend (which would fuel

small-and-mid cap growth), 2) the high valuation premium of the smaller stocks

compared with the heavyweights coupled with an increased risk of disappointing

earnings, and 3) the missing discount for the lower liquidity in volatile markets.

Since the start of the equity bull market in 2009, small-and-mid caps beat the large

caps driven by stock gains in the market overall. In 2016, the opposite is set to

happen. Investors should overweight large caps. The status quo in many portfolios is

probably the contrary. So far, investors have bet on higher growth and takeover

speculation related to small-and-mid caps. Investors will have to be more selective

when picking small-and-mid caps. There are a few factors supporting this shift:

#1: A VERY VOLATILE SIDEWAYS MARKET

Whether large or small-and-mid caps perform better depends first of all on the

general market outlook. Bull markets favour small-and-mid caps, troubled times the

heavyweights. Relatively speaking, large caps are the “safer” haven. This is

underpinned by the historical trend since the early 2000s. In the last upturn from

2004 to 2007, the period of relative strength ended significantly before the general

market peak. A very volatile sideways movement, as we expect for 2016, supports

the relative strength of large caps or at least suggests the relative strength of the

small-and-mid caps is set to fade.

In the past few quarters, it was observed that small-and-mid caps reacted with a

delay to losses on the market (see right chart on next page). The first wave on the

market involved large caps, often via forward sales of liquid DAX futures. Small-and-

mid caps were less affected. Investors reacted only in a second step with outright

sales of small-and-mid caps. This may be partly attributable to the fact that small-

and-mid caps react more strongly to quarterly reports, whereas the heavyweights

depend more on key economic indicators, which have often influenced the overall

market even before the quarterly reports.

Ralf Zimmermann Fon +49 211 4952-841

[email protected]

Large caps are – in relative terms –

a safe haven

Small-and-mid caps react with a

delay

BANKHAUS LAMPE // 10


Small-and-mid caps struggle when the climate gets

rougher

In the past few months, small-and-mid caps reacted with a

delay

Source: Thomson Reuters Datastream Source: Thomson Reuters Datastream

The pattern in the US also favours the heavyweights. In the earlier cycles (1994/95,

1999/2000, 2008/09), the market pattern of “large caps vs. small caps” in the US

had a head start of three to nine months compared with the German market (see

chart). In the current cycle, US small-and-mid caps have not been able to build up

their relative strength compared with the heavyweights in the stock market since

early 2014. Recently, the small-and-mid caps have even shown a noticeable relative

weakness – which is also a leading indicator for the fading relative strength of the

MDAX in Germany.

Rising volatility supporting DAX In the US, no longer any relative strength for mid caps

Source: Thomson Reuters DataStream Source: Thomson Reuters DataStream

#2: LESS LIQUIDITY DEMANDS A VALUATION DISCOUNT

The key element of our general equity outlook is the higher volatility – which also

favours large caps. Heavyweights perform better than small-and-mid caps in phases

of rising volatility. By contrast, small-and-mid caps are ahead of the game when

volatility decreases or remains low. This is closely tied to the lower liquidity of

smaller stocks. Investors come under greater pressure to sell if volatility rises.

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0.850.951.051.151.251.351.451.551.651.751.851.952.052.15

2002 2004 2006 2008 2010 2012 2014 2016

Relative performance MDAX/DAX, l.s. DAX, r.s.

Relative price %

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2012 2014 2016

Relative performance MDAX/DAX, l.s. DAX with 10 weeks lead, r.s.

Relative price %

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2002 2004 2006 2008 2010 2012 2014 2016

Relative performance DAX/MDAX, l.s. VDAX (smoothed), r.s.

Relative price %

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1992 1995 1998 2001 2004 2007 2010 2013 2016

Relative Performance MDAX/DAX, l.s.Relative Performance S&P Mid Caps/S&P Large Caps, r.

Relative price Relative price

US small-and-mid caps show

relative weakness – in the past a

leading indicator for the pattern on

the German market

Higher volatility favours the liquid

large caps



An analysis of trading volumes for the various German indices shows the liquidity

advantages that heavyweights enjoy:

• First of all, trading on the Xetra in the four German indices (DAX, MDAX,

TecDAX & SDAX) is on a par with 2006, but has been declining in recent years.

Within the indices, trade with DAX stocks has decreased as a percentage

overall, while TecDAX and MDAX stocks have increased their share of the

market in particular.

• Nevertheless, DAX stocks remain more liquid, even though the lead has

decreased. A position in DAX stocks can be reduced quicker than is the case

for small-and-mid caps. If an investor owns one percent of the free float for a

share, this corresponds to 2.4 days’ trading revenue on the Xetra (as an

average for all DAX stocks). This figure is 28% higher for the MDAX, and for

the SDAX hypothetically it even takes 2.5 times longer in order to place 1%

based on the latest volumes (30 days). Owing to a few extremely liquid shares,

only the TecDAX can match the DAX – although it should be borne in mind

that in part TecDAX trading was distorted upwards by profit warnings that

weighed on share prices (i.e. Manz, Dialog Semiconductor).

• In addition, investors in small-and-mid caps will typically hold a greater

proportion of the company faster; this is particularly true for SDAX stocks.

As the liquidity of smaller stocks is generally less than that of large caps, winding

down an investment (and building up a position) is associated with a greater share

price risk. It takes longer to sell off a position in smaller caps and divestments (e.g.

after disappointing quarterly reports) can therefore lead to higher stock losses. This

became already apparent with the Q3 2015 reports with some shares showing

double-digit losses. In our view, this pattern is set to continue in 2016.

Xetra turnover in German stocks falling until YE 2014 DAX stocks still more liquid despite market share losses

Source: Thomson Reuters DataStream Source: Thomson Reuters DataStream

Due to the low growth environment, we expect disappointments in 2016 as

consensus expectations remain this optimistic. We expect higher losses for small-

and-mid caps than for the heavyweights. Thus, in a volatile environment, investors

need to have faith in the profits of smaller companies. If they don’t, it is sensible to

0

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Jan 05 Jan 07 Jan 09 Jan 11 Jan 13 Jan 15

Xetra trade volume (shares) DAX, MDAX, SDAX, TecDAX - rolling average1 year

volume in m shares

Index

How many days are needed by the average of

index constituents to sell off a position of

1% of free float?

(assumption: Xetra trading volume similar to

average of last 30 days)*

2005 2015

DAX 2.4 83% 75%MDAX 3.1 10% 12%SDAX 6.0 3% 4%TecDAX 2.5 4% 8%

Share in trading volume

* Assumption for free float: Number of publicly available shares. This number is calculated bydeduction of shares owned by insiders or shareholders who are long-term investors from the shares outstanding. Long-term investors are among others employees, pension trusts, companies which have no active asset management, venture capital companies and governments holding shares.

It takes longer to reduce positions

in smaller caps

Earnings disappointments at small-

and-mid caps do potentially lead to

greater stock losses



sell of positions before the start of the reporting season. This is particularly true if

the leading indicators (PMI, Ifo) have not risen. This means, investors should invest

anti-cyclically when it comes to smaller stocks.

#3: HIGH VALUATION PREMIUM OF MDAX WITH INCREASED RISK OF NEGATIVE

EARNINGS REVISION

Small-and-mid caps have not had a valuation discount for years now in order to

compensate for their lower liquidity. Investors are betting on higher growth rates

and – in some cases – takeover hopes. After the strong performance of the small-

and-mid caps, their valuation premium to the heavyweights is close to historic

highs. The MDAX is trading at a premium of 38%, only topped in early 2015. What is

more, given the optimistic growth expectations for the MDAX (+16% for 2016, IBES

consensus); we see a high risk of negative revisions of MDAX estimates. Based on

our top-down earnings expectations for each index, the relative earnings estimates

are set to favour the DAX as we anticipate a higher risk for revisions of the MDAX

estimates. If this risk materialises, the valuation premium for the MDAX would

increase further based on constant share prices.

High valuation premium of MDAX vs. DAX Earnings revisions are likely to have a stronger negative

effect on the MDAX

Source: Thomson Reuters Datastream Source: Thomson Reuters Datastream

The other German small-and-mid-cap indices paint a similar picture. However, the

quality of data is not as good. IBES valuations are not available and the FactSet

valuations for the SDAX and the TecDAX are very volatile.

Analysts expect sustained high earnings growth of over 25% for both the SDAX and

the TecDAX. Some earnings estimates have even been increased recently and are

probably far too optimistic. The smaller the stock, the more pronounced is the delay

in earnings estimates in an environment of weakening growth.

0.7

0.9

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-40%

-30%

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-10%

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02 04 06 08 10 12 14 16

relative valuation MDAX/DAX (PE next 12 months), > 0 = valuationpremium of MDAX, <0 = valuation discount of MDAX, l.s.relative Performance MDAX/DAX, r.s.

distortion due to collapsing earnings at MDAX

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118

Dec 13 Jun 14 Dec 14 Jun 15 Dec 15 Jun 16Relative Performance MDAX/DAX

Relative earnings estimates (next 12m) MDAX/DAX

MDAX/DAXend 2013 = 100 respectively

Top-down assumptionsfor relative earnings estimates

The MDAX is more expensive than

the DAX

Estimates for SDAX and TecDAX

are too high



Unrealistic growth expectations at all German small and mid cap indices

Even based on aggressive growth expectations, the indices are trading at a high

premium. With more realistic lower estimates the “actual” premium would be even

higher. The current valuation of all three German small-and-mid-cap indices is

above the average since 2004 (see table). The premium vs. the DAX also stands at

0.8 (SDAX) and 1.8 (TecDAX) times the standard deviation above the long-term

average (see charts).

However, we question whether the lower liquidity compared with the large caps is

sufficiently taken account of. This is especially true if disappointments were to arise

from the optimistic analyst consensus.

High absolute and relative valuation of small and mid-cap indices

Earnings estimates for German stock market segments

2015/14 2016/15 2015 2016 12m forward

DAX 15.5% 4.4% 1.0% 0.1% 1.2%

MDAX 14.7% 12.7% 2.9% 1.1% 3.4%

SDAX 35.8% 32.2% -2.1% 1.8% 5.8%

TecDAX -36.5% 24.0% -3.5% -6.9% -4.7%

Source: FactSet

Revisions last 2mGrowth

Earnings estimates are based on Factset consensus. They do deviate from IBES consensus data.

Valuation of German stock market segments

DAX MDAX SDAX TecDAX

Absolute 12month forward PE

Current 12m forward PE 11.4 15.6 15.4 22.4Average since 2004 (03/2009-11/2009 excluded) 12.0 14.2 14.8 18.2

Z-Score 1) -0.4 0.6 0.3 1.0Max. 18.1 19.0 21.5 28.9Min. 8.0 8.1 8.3 10.3

Valuation premium/discount vs DAX

Based on current 12m forward PE 37% 35% 96%Average since 2004 (03/2009-11/2009 excluded) 19% 25% 53%

Z-Score 1) 1.1 0.8 1.8

Max. 45% 55% 115%Min. -24.0% -17.9% 4.1%

Source: FactSet

1) Z-Score = (current value - mean)/standard deviation. Z-Score > 1 indicates strong deviation from the past

High valuation premium across all



SDAX: Higher premium than DAX TecDAX: Always more expensive than DAX, but more

expensive than usual

Source: FactSet Source: FactSet

What does that mean?

• Investors should be strategically (beyond the fluctuations) long in the DAX and

short in the MDAX and overweight large caps in a broad-based portfolio.

• Stock picking becomes much more difficult in an environment of persistently

low growth, in which discussions about a recession can certainly arise (even

without an actual recession).

• Small-and-mid caps react more strongly to quarterly reports (and

disappointments). In periods of stagnating or falling leading indicators,

positions in small-and-mid caps should be reviewed more critically ahead of

the reporting season and should be sold.

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Company Portraits



in m EUR 2013 2014 2015e 2016e 2017e

Sales 528.6 535.3 564.0 585.9 603.5

EBIT 28.9 26.2 14.8 28.0 31.9

EBIT margin 5.5% 4.9% 2.6% 4.8% 5.3%

Net financial debt 7.9 -8.8 -11.3 -21.9 -31.5

Free cash-flow 31.8 24.9 5.5 16.0 18.7

EPS (in EUR) 1.05 0.77 0.37 0.95 1.09

DPS (in EUR) 0.45 0.50 0.30 0.50 0.60

Dividend yield 4.5% 3.7% 3.0% 5.5% 6.6%

EV/Sales 0.4 0.5 0.3 0.3 0.2

EV/EBIT 6.8 9.4 12.4 5.5 4.6

Price Earnings ratio (P/E) 9.4 17.6 26.9 9.6 8.4


Next event

Annual Results 17/03/2016

Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Christoph Schlienkamp , Investmentanalyst DVFA

Phone: +49 (0)211 4952-311

[email protected]

See end of document for disclaimer.

Adler Modemärkte AG Attractive niche player

Adler was also not spared by the effects of the weak German fashion sector in the

past few months. But we continue to assume that Adler is active in an attractive

market niche. However, an upgrade would require improved newsflow from the

textile retail sector.

INVESTMENT CASE

Adler is the only large vendor in fashion retail with a clear focus on the 45+ age

target group. This means that the company not only has a clear positioning, but is also

benefiting from the demographic trends in Germany and Europe. Its target group and

therefore the revenue potential are set to grow significantly in the coming decades.

This foundation is complemented by careful additions to the portfolio range, which

should lead to steady growth in new customers. Opportunities lie also in the group’s

growth strategy. This includes new fashion stores in so far little developed regions, the

roll-out of brand shop concepts and the modernisation of its existing stores. In

addition to organic growth, Adler is also planning on acquisitions provided that these

offer a sustained increase in the return on assets.

CATALYSTS

The most important catalysts will be more positive general newsflow from the German

fashion sector. We regard strategic acquisitions by Adler as positive in the medium

term; however, like in 2015, they will probably curb earnings growth in the short-

term. Changes in the exchange rates of the yuan and the US dollar could be both

upside or risk.

VALUATION

The stock is currently trading at a 2016e PER of 10x, which appears attractive at

first glance. However, this also reflects the low liquidity with a free float of below

50%. In contrast, the dividend yield of 3% should limit possible share price declines.

28/01/2016

Hold (Hold )

10.00 EUR (10.00 EUR )

Close 25/01/2016 9.12 EUR

Bloomberg: ADD GY WKN: A1H8MU

Sector Retail

Share price performance

52 week high 13.40 EUR

52 week low 8.86 EUR

Compared to Prime All Share

YTD -0.6%

1 month 5.0%

12 months -19.6%

Share data

EV (m EUR; 2016) 154.6

Market Cap (m EUR) 168.9

No. of shares (m) 18.5

Free float 42.2%



SWOT

Strengths/Opportunities

• High level of brand recognition in Germany

• Strong customer retention thanks to loyalty card

• Growth in international markets

• Adler is benefiting from demographic trends

Weaknesses/Threats (Risks)

• Highly competitive environment

• Unit sales of new collection are dependent on weather conditions

• Changes in consumer behaviour

• Further increase in competitive pressure

MANAGEMENT COMPANY BACKGROUND

• Lothar Schäfer (CEO)

• Karsten Odemann (CFO)

Adler is a fashion retailer with stores in Germany, Austria, Luxembourg and

Switzerland. The company has a long history spanning over 60 years. Its

product range and business strategy focus on the 45+ target group.

SHORT-TERM GUIDANCE MEDIUM-TERM GUIDANCE

• 2015: revenue growth in mid-single-digit percentages

• 2015: EBITDA of € 30-33 m

• 2015: positive earnings after tax

• 2016: notable earnings improvement expected

HISTORICAL P/E REVENUE BREAKDOWN (LAST ACTUAL YEAR)

COMPANY EVENTS MAJOR SHAREHOLDERS (%)

Next event: 17/03/2016 Annual Results Steilmann Holding 52.8

Gerhard Woehrl 5.0

Taaeleritehdas AM 3.1

KEY RATIOS BHL VS. CONSENSUS

Source: Company information, FactSet, BHL estimates

0

10

20

2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

100.0%

Fashion Stores

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 564.0 585.9 603.5

Consensus 561.1 583.8 604.8

EBIT (in m EUR)

BHL 14.8 28.0 31.9

Consensus 15.5 22.6 29.2

EPS (EUR)

BHL 0.37 0.95 1.09

Consensus 0.39 0.65 0.91

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 2.1% 2.2% 3.0% 2.9% 2.9%

Capex/Depreciation 0.8 0.8 1.0 1.0 1.0

ROCE 18.0% 15.1% 8.6% 15.2% 16.3%

Free cash flow yield 18.2% 14.1% 2.9% 9.1% 10.6%

Equity ratio 40.3% 43.2% 41.5% 44.0% 46.0%

Net debt / Equity 9% -8% -11% -19% -25%

Net debt / EBITDA 0.2 -0.2 -0.4 -0.5 -0.6

Interest cover > 10 > 10 > 10 > 10 0.0



Adler Modemärkte AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 528.6 535.3 564.0 585.9 603.5

Own work capitalised 0.0 0.0 0.0 0.0 0.0

Total sales 528.6 535.3 564.0 585.9 603.5

Material expenses -234.9 -243.2 -251.0 -260.7 -268.5

Personnel expenses -92.0 -95.2 -100.4 -104.3 -107.4

Unusual or infrequent items 0.0 0.0 0.0 0.0 0.0

Other operating result -158.8 -155.3 -181.6 -176.3 -178.6

EBITDA 42.9 41.5 31.0 44.5 48.9

Depreciation 14.0 15.4 16.2 16.5 17.0

EBITA 28.9 26.2 14.8 28.0 31.9

Amortisation of goodwill 0.0 0.0 0.0 0.0 0.0

Amortisation of intangible assets 0.0 0.0 0.0 0.0 0.0

EBIT 28.9 26.2 14.8 28.0 31.9

Financial result -4.3 -5.0 -4.9 -3.0 -3.0

Income on ordinary activities 24.6 21.2 9.9 25.0 28.9

Extraordinary income/loss 0.0 0.0 0.0 0.0 0.0

EBT 24.6 21.2 9.9 25.0 28.9

Taxes -6.0 -7.1 -3.0 -7.5 -8.7

Net income from cont. operations 18.6 14.1 6.9 17.5 20.2

Net income from discont. operations 0.0 0.0 0.0 0.0 0.0

Minority interest 0.0 0.0 0.0 0.0 0.0

Net income (adj.) 18.6 14.1 6.9 17.5 20.2

No. of shares 17.6 18.5 18.5 18.5 18.5

EPS 1.05 0.77 0.37 0.95 1.09


2013 2014 2015e 2016e 2017e

Gross margin 55.6% 54.6% 55.5% 55.5% 55.5%

EBITDA margin 8.1% 7.8% 5.5% 7.6% 8.1%

EBITA margin 5.5% 4.9% 2.6% 4.8% 5.3%

EBIT margin 5.5% 4.9% 2.6% 4.8% 5.3%

EBT margin 4.7% 4.0% 1.8% 4.3% 4.8%

Net profit margin 3.5% 2.6% 1.2% 3.0% 3.4%

Tax rate 24.5% 33.3% 30.0% 30.0% 30.0%


Growth rates yoy 2013 2014 2015e 2016e 2017e

Sales 4.5% 1.3% 5.4% 3.9% 3.0%

EBITDA 20.8% -3.1% -25.3% 43.6% 9.8%

EBIT 41.0% -9.3% -43.4% 89.3% 13.7%

EBT 52.0% -13.7% -53.3% >100% 15.4%

Net income (adj.) 83.9% -23.7% -51.0% >100% 15.4%

EPS 87.0% -27.4% -51.0% >100% 15.4%


Key figures



Adler Modemärkte AG – Balance sheet

Assets (in m EUR) 2013 2014 2015e 2016e 2017e

Fixed assets 89.1 93.1 93.7 94.4 95.1

Property, plant and equipment 72.2 72.5 73.2 73.9 74.7

Intangible assets 6.2 6.8 6.7 6.6 6.6

Financial assets 1.5 1.5 1.5 1.5 1.5

Other long-term assets 9.1 12.3 12.3 12.3 12.3

Current assets 139.4 151.2 155.4 167.9 179.3

Inventories 77.5 75.6 77.1 78.6 80.2

Accounts receivable 0.1 0.2 0.2 0.2 0.2

Other current assets 7.3 5.5 5.8 6.1 6.4

Securities 0.0 0.3 0.3 0.3 0.3

Cash 54.5 69.7 72.1 82.7 92.3

Total assets 228.4 244.3 249.1 262.3 274.4

Equity and liabilities in m EUR

Shareholders’ equity 92.0 105.6 103.3 115.3 126.3

Shareholders’ equity (before minority) 92.0 105.6 103.3 115.3 126.3

Minorities 0.0 0.0 0.0 0.0 0.0

Non-current liabilities 62.1 63.5 70.0 70.3 70.7

Pension provisions 5.9 7.1 7.4 7.6 7.8

Other provisions 1.5 1.5 1.5 1.5 1.5

Long-term financial debt 52.1 50.9 50.9 50.9 50.9

Other long-term debt 2.6 4.0 10.2 10.4 10.5

Current liabilities 74.3 75.1 75.9 76.6 77.4

Short-term debt 10.3 10.2 10.2 10.2 10.2

Other accruals short-term 3.6 4.2 4.2 4.2 4.2

Accounts payable 39.6 38.0 38.8 39.5 40.3

Other liabilities 20.8 22.8 22.8 22.8 22.8

Total equity and liabilities 228.4 244.3 249.1 262.3 274.4


Adler Modemärkte AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 39.0% 38.1% 37.6% 36.0% 34.6%

Property, plant and equipment 31.6% 29.7% 29.4% 28.2% 27.2%

Intangible assets 2.7% 2.8% 2.7% 2.5% 2.4%

Current assets 61.0% 61.9% 62.4% 64.0% 65.4%

Inventories 33.9% 30.9% 30.9% 30.0% 29.2%

Accounts receivable 0.0% 0.1% 0.1% 0.1% 0.1%

Cash 23.9% 28.5% 28.9% 31.5% 33.6%

Equity and liabilities

Shareholders’ equity 40.3% 43.2% 41.5% 44.0% 46.0%

Non-current liabilities 27.2% 26.0% 28.1% 26.8% 25.8%

Pension provisions 2.6% 2.9% 3.0% 2.9% 2.8%

Long-term financial debt 22.8% 20.9% 20.4% 19.4% 18.6%

Current liabilities 32.5% 30.7% 30.4% 29.2% 28.2%

Short-term debt 4.5% 4.2% 4.1% 3.9% 3.7%

Accounts payable 17.3% 15.6% 15.6% 15.1% 14.7%




Adler Modemärkte AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 18.6 14.1 6.9 17.5 20.2

Depreciation 14.0 15.4 16.2 16.5 17.0

Amortisation of goodwill & intangible assets 0.0 0.0 0.0 0.0 0.0

Change of provisions -0.3 1.8 0.2 0.2 0.2

Other 6.6 1.3 0.0 0.0 0.0

Operating Cash-flow before changes in w/c 38.9 32.6 23.4 34.2 37.4

Change in inventory 4.8 2.0 -1.5 -1.5 -1.6

Change in accounts receivable 2.1 -0.1 0.0 0.0 0.0

Change in accounts payable -0.9 -1.6 0.8 0.8 0.8

Change in other working capital positions -3.9 3.5 -0.3 -0.3 -0.3

Operating Cash-flow 40.9 36.4 22.3 33.2 36.4

Capex, excluding maintenance -11.1 -11.7 -16.9 -17.2 -17.7

Payments for acquisitions 0.0 0.0 0.0 0.0 0.0

Financial investments 0.0 0.0 0.0 0.0 0.0

Income from asset disposals 1.9 0.2 0.0 0.0 0.0

Income from financial investments 0.0 0.0 0.0 0.0 0.0

Cash-flow from investing activities -9.2 -11.4 -16.9 -17.2 -17.7

Free cash-flow 31.8 24.9 5.5 16.0 18.7

Capital measures 0.0 0.0 0.0 0.0 0.0

Increase/decrease in debt position -0.3 -0.3 0.0 0.0 0.0

Purchase of own shares 0.0 8.9 0.0 0.0 0.0

Other financing Cash-flow -12.0 -10.1 6.2 0.2 0.2

Dividend paid -7.0 -8.3 -9.2 -5.6 -9.3

Cash-flow from financing activities -19.4 -9.8 -3.0 -5.4 -9.1

Increase/ decrease in liquid assets 12.4 15.1 2.4 10.6 9.6

Effects of exchange rate changes 0.0 0.0 0.0 0.0 0.0

Cash at beginning of period 42.1 54.5 69.7 72.1 82.7

Change in total cash and cash equivalents 12.4 15.1 2.4 10.6 9.6

Cash at end of period 54.5 69.7 72.1 82.7 92.3




Adler Modemärkte AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 1.05 0.77 0.37 0.95 1.09

Book value per share 5.23 5.72 5.58 6.23 6.82

Free Cash-flow per share 1.81 1.35 0.30 0.87 1.01

Dividend per share 0.45 0.50 0.30 0.50 0.60

Valuation ratios

EV/Sales 0.4 0.5 0.3 0.3 0.2

EV/EBITDA 4.6 6.0 5.9 3.5 3.0

EV/EBIT 6.8 9.4 12.4 5.5 4.6


Price to book (total equity) 1.9 2.4 1.8 1.5 1.3

Dividend yield 4.5% 3.7% 3.0% 5.5% 6.6%

Profitability ratios

EBITDA margin 8.1% 7.8% 5.5% 7.6% 8.1%

EBIT margin 5.5% 4.9% 2.6% 4.8% 5.3%

Net return on sales 3.5% 2.6% 1.2% 3.0% 3.4%

Return on capital employed (ROCE) 18.0% 15.1% 8.6% 15.2% 16.3%

Productivity ratios

Capital turnover 24.0% 24.4% 23.4% 22.8% 22.4%

Operating leverage -0.4 0.1 0.4 -0.9 -0.1

Sales per employee 121,970 128,852 134,275 137,853 140,337

EBIT per employee 6,664 6,304 3,527 6,596 7,415

Number of employees (in thousands) 4.3 4.2 4.2 4.3 4.3

Financial ratios

Equity ratio 40.3% 43.2% 41.5% 44.0% 46.0%

Net financial debt (in m EUR) 7.9 -8.8 -11.3 -21.9 -31.5

Net debt / Equity 8.6% -8.4% -10.9% -19.0% -24.9%

Interest cover > 10 > 10 > 10 > 10 0.0

Net debt / EBITDA 0.18 -0.21 -0.36 -0.49 -0.64

Working Capital (in m EUR) 38.0 37.7 38.5 39.2 40.0

Change Working Capital (in m EUR) -1.8 -0.3 0.8 0.8 0.8

WC /sales 7.2% 7.0% 6.8% 6.7% 6.6%

Stocks in days of sales 54 52 50 49 48

Trade debtors in days of sales 0 0 0 0 0

Trade creditors in days of COGS/Material cost 27 26 25 25 24

Cash conversion cycle 27 26 25 24 24

Invest. (property/plant/equity) / Depreciation 79.3% 75.9% 104.1% 104.0% 104.0%

Others

Sales CAGR (last 3 years) 5.9% 3.9% 3.7% 3.5% 4.1%

EBIT CAGR (last 3 years) 5.9% 17.1% -10.2% -1.0% 6.8%

Net income CAGR (last 3 years) -12.2% 19.0% -11.7% -1.9% 12.6%

Pay out ratio 42.7% 65.3% 80.0% 52.8% 54.9%

Free cash-flow (in m EUR) 31.8 24.9 5.5 16.0 18.7





in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Sales 246.7 257.1 244.2 252.7 261.5

EBIT 7.3 9.2 5.1 8.4 10.7

EBIT margin 3.0% 3.6% 2.1% 3.3% 4.1%

Net financial debt 27.9 26.8 29.9 28.8 32.0

Free cash-flow -2.8 7.2 8.0 3.8 4.6

EPS (in EUR) 0.38 0.42 0.20 0.36 0.47

DPS (in EUR) 0.50 0.45 0.20 0.35 0.45

Dividend yield 4.2% 4.0% 2.6% 4.8% 6.2%

EV/Sales 0.8 0.7 0.6 0.5 0.5

EV/EBIT 26.7 20.4 28.5 16.3 13.0



Next event


Change in model

Sales EBIT EPS

2014/15e --- --- ---

2015/16e --- --- ---

2016/17e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Ahlers AG Lower dividend – but more positive outlook

We expect Ahlers to publish disappointing results for 2014/15 on 10 March.

However, we regard the outlook as more positive as we expect the group’s EBIT

margin to improve in the current full year (BHLe: 3.3% after 2.1%). Nevertheless,

profitability is set to remain slightly below the 3.6% achieved in FY 2013/14 overall.

INVESTMENT CASE

The company currently focuses on leveraging growth potential. With regard to

Pierre Cardin, the company is not only pressing ahead with the expansion of its

business primarily in France, Spain, Belgium and Poland, it also intends to establish

Pierre Cardin Woman on the market. At Baldessarini, the group has reorganised its

product management, which should lead to renewed success. After structural

changes, the e-Commerce segment has also seen significant improvements in the

last few months, which have led to revenue growth of 26% in the first nine months

of 2014/15. In order to maintain this growth momentum, marketing campaigns

strengthening the brand awareness for the products will be required.

CATALYSTS

The largest factor of uncertainty remains the Russian market, in our view, which

carries a certain amount of risk not only in terms of distribution but also payment.

The annual results for 2014/15 are likely to disappoint in line with expectations,

however, the outlook should be optimistic. Ahlers recently confirmed its intention to

pay an adequate dividend in view of the expected positive cash flow. Our estimate

of € 0.20 remains unchanged.

VALUATION

The share is currently trading at a dividend yield of close to 3%. We are optimistic

that 2014/15 was the last year of transition and therefore trust that dividend

payouts will rise again in future.

28/01/2016

Hold (Hold )

8.50 EUR (9.00 EUR )

Close 25/01/2016 7.30 EUR

Bloomberg: AAH3 GR WKN: 500973

Sector Retail





YTD 6.5%

1 month 5.7%

12 months -26.5%

Share data

EV (m EUR; 2016) 136.1



Free float 48.2%



SWOT


• Attractive dividend yield

• Verticalisation of business models yields opportunities for growth

• Increasing internationalisation

• Continuous optimisation of procurement and logistical processes


• Stronger branding necessary

• Capital structure with ordinary and preference shares is outdated

• Low liquidity of the share


• Dr Stella Ahlers (CEO)

• Dr Karsten Kölsch (CFO)

Ahlers AG is one of Europe's largest exchange-listed fashion makers with a

focus on men's wear. The company sells clothing under various brands,

including Pierre Cardin, Otto Kern, Baldessarini, Gin Tonic, Jupiter, Pioneer

Authentic Jeans, Pionier Jeans & Casuals and Pionier Workwear. Ahlers is

headquartered in Herford, Germany.


• 2014/15: Revenue decline of up to 5%

• 2014/15: significant decline in group earnings

• -



Next event: 10/03/2016 Annual Results Vz: Stella Ahlers 20.8



0

10

20

30

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

64.3%

27.0%

8.7%

Premium Brands

Jeans & Workwear

Men's & Sportswear

Company Overview

2014/15e 2015/16e 2016/17e

Sales (in m EUR)

BHL 244.2 252.7 261.5

Consensus 243.6 251.4 259.5

EBIT (in m EUR)

BHL 5.1 8.4 10.7

Consensus 4.2 10.0 11.7

EPS (EUR)

BHL 0.20 0.36 0.47

Consensus 0.17 0.46 0.54

2012/13

2013/14

2014/15e

2015/16e

2016/17eR&D/Sales - - - - -

Capex/Sales 1.8% 2.4% 2.5% 2.3% 2.2%


ROCE 5.0% 6.2% 3.4% 5.6% 7.1%

Free cash flow yield -1.7% 4.7% 7.2% 3.4% 4.1%

Equity ratio 59.9% 57.9% 57.3% 57.8% 59.1%

Net debt / Equity 25% 24% 28% 26% 29%

Net debt / EBITDA 2.2 1.8 2.8 2.0 1.9

Interest cover > 10 > 10 > 10 > 10 > 10



Ahlers AG – Income statement

in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Sales 246.7 257.1 244.2 252.7 261.5


Total sales 252.6 260.0 244.2 252.7 261.5





EBITDA 12.6 14.6 10.7 14.1 16.5

Depreciation 5.3 5.4 5.6 5.7 5.8

EBITA 7.3 9.2 5.1 8.4 10.7



EBIT 7.3 9.2 5.1 8.4 10.7




EBT 6.7 8.4 4.2 7.3 9.5

Taxes -1.1 -2.4 -1.2 -2.1 -2.8



Minority interest -0.4 -0.3 -0.3 -0.3 -0.3

Net income (adj.) 5.2 5.8 2.7 4.9 6.5

No. of shares 13.7 13.7 13.7 13.7 13.7

EPS 0.38 0.42 0.20 0.36 0.47


2012/13 2013/14 2014/15e 2015/16e 2016/17e

Gross margin 48.0% 48.8% 48.8% 49.0% 49.0%

EBITDA margin 5.1% 5.7% 4.4% 5.6% 6.3%

EBITA margin 3.0% 3.6% 2.1% 3.3% 4.1%

EBIT margin 3.0% 3.6% 2.1% 3.3% 4.1%

EBT margin 2.7% 3.3% 1.7% 2.9% 3.6%


Tax rate 16.8% 28.3% 29.0% 29.0% 29.0%


Growth rates yoy 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Sales -2.5% 4.2% -5.0% 3.5% 3.5%

EBITDA -26.7% 15.5% -26.9% 32.0% 17.3%

EBIT -33.7% 24.8% -44.8% 65.4% 27.9%

EBT -34.9% 26.1% -50.1% 74.0% 30.6%

Net income (adj.) -25.0% 11.1% -53.5% 82.2% 32.5%

EPS -25.0% 11.1% -53.5% 82.2% 32.5%


Key figures



Ahlers AG – Balance sheet

Assets (in m EUR) 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Fixed assets 62.2 60.7 61.3 61.3 61.3





Current assets 120.2 129.7 125.1 127.2 126.0

Inventories 75.7 79.4 79.0 80.0 82.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 3.9 6.3 5.1 6.2 3.0

Total assets 182.4 190.4 186.4 188.5 187.2




Minorities 2.2 2.3 2.3 2.3 2.3







Short-term debt 6.4 8.9 9.0 9.0 9.0






Ahlers AG – Balance sheet structure

Assets 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Fixed assets 34.1% 31.9% 32.9% 32.5% 32.7%



Current assets 65.9% 68.1% 67.1% 67.5% 67.3%

Inventories 41.5% 41.7% 42.4% 42.5% 43.8%


Cash 2.2% 3.3% 2.7% 3.3% 1.6%







Short-term debt 3.5% 4.7% 4.8% 4.8% 4.8%





Ahlers AG – Cash flow statement

in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Net income (adj.) 5.2 5.8 2.7 4.9 6.5

Depreciation 5.3 5.4 5.6 5.7 5.8



Other 0.1 1.4 4.7 -0.1 0.1


Change in inventory -9.8 -3.8 0.4 -1.0 -2.0

Change in accounts receivable -1.2 -2.7 3.5 0.0 0.0

Change in accounts payable 3.0 2.6 -2.5 0.0 0.0

Change in other working capital positions -0.1 1.0 -0.7 0.0 0.0




Financial investments -0.2 -0.3 0.0 0.0 0.0




Free cash-flow -2.8 7.2 8.0 3.8 4.6


Increase/decrease in debt position 2.5 -1.8 1.9 0.0 0.0


Other financing Cash-flow 0.0 0.0 -0.2 0.0 -3.0

Dividend paid -8.6 -6.5 -6.2 -2.7 -4.8


Increase/ decrease in liquid assets -8.9 -1.0 3.5 1.1 -3.2

Effects of exchange rate changes -0.2 0.0 0.0 0.0 0.0


Change in total cash and cash equivalents -9.1 -1.0 3.5 1.1 -3.2





Ahlers AG – Ratios

2012/13 2013/14 2014/15e 2015/16e 2016/17e

Per Share Data

EPS 0.38 0.42 0.20 0.36 0.47


Free Cash-flow per share -0.20 0.53 0.59 0.28 0.33


Valuation ratios

EV/Sales 0.8 0.7 0.6 0.5 0.5

EV/EBITDA 15.5 12.8 13.5 9.7 8.4

EV/EBIT 26.7 20.4 28.5 16.3 13.0



Dividend yield 4.2% 4.0% 2.6% 4.8% 6.2%


EBITDA margin 5.1% 5.7% 4.4% 5.6% 6.3%

EBIT margin 3.0% 3.6% 2.1% 3.3% 4.1%



Productivity ratios


Operating leverage 13.2 5.9 8.9 18.7 8.0




Financial ratios

Equity ratio 59.9% 57.9% 57.3% 57.8% 59.1%

Net financial debt (in m EUR) 27.9 26.8 29.9 28.8 32.0

Net debt / Equity 25.5% 24.3% 28.0% 26.5% 29.0%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 2.21 1.84 2.80 2.05 1.94


Change Working Capital (in m EUR) 7.9 3.9 -1.5 1.0 2.0

WC /sales 37.1% 37.1% 38.5% 37.6% 37.1%






Others

Sales CAGR (last 3 years) -0.5% 0.1% -1.2% 0.8% 0.6%

EBIT CAGR (last 3 years) -21.4% -16.7% -23.0% 4.4% 5.3%

Net income CAGR (last 3 years) -15.5% -16.2% -27.1% -2.0% 3.9%

Pay out ratio 131.8% 106.7% 102.0% 97.9% 95.1%

Free cash-flow (in m EUR) -2.8 7.2 8.0 3.8 4.6





in m EUR 2013 2014 2015e 2016e 2017e

Sales 182.9 193.8 192.0 190.0 238.0

EBIT -95.7 -58.3 -35.5 -25.0 0.1

EBIT margin -52.4% -30.1% -18.5% -13.2% 0.0%

Net financial debt -306.3 -268.1 -209.5 -196.2 -185.3

Free cash-flow -1.3 -47.0 -58.6 -13.3 -15.0

EPS (in EUR) -0.97 -0.56 -0.31 -0.15 0.01

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 4.3 4.0 1.3 1.0 0.9

EV/EBIT -8.3 -13.4 -7.1 -7.9 3,469.3

Price Earnings ratio (P/E) -10.9 -16.8 -13.4 -23.4 530.2


Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Dr. Karsten Iltgen , Analyst

Phone: +49 (0)211 4952-351

[email protected]


AIXTRON SE Hopes pinned on OLED

After the disappointment at Sanan, all hopes are essentially pinned on the non-LED

business and in particular the growing OLED business (organic LED). However, the

potential for success in this attractive market is hard to predict.

INVESTMENT CASE

• For a few years, Aixtron has been developing coating plants for large OLED

displays and even full production lines for small OLED displays. It remains to

be seen this year, how successful Aixtron can be in this business. If the

segment performs well, it may well become the key driver of the business in

the next few years.

• Although other non-LED businesses such as power electronics are still

performing well, are too small to become real growth drivers, in our view.

CATALYSTS

• The management team expects the first OLED order by mid-2016. In our

model, we project OLED revenues of € 20 m in 2017.

• We expect an order from OSRAM in H2 2016. We estimate the entire order

volume to be € 160 m. It is still uncertain, what share of this will go to

Aixtron.

VALUATION

We estimate the net cash position at the end of the year to be € 2.00 per share.

Taking this into consideration, the valuation appears to be very low. To take account

of the persisting uncertainties, we have reduced our long-term projections. Our

price target has dropped from € 6.00 to € 4.00.

28/01/2016

Hold (Hold )

4.00 EUR (6.00 EUR )

Close 25/01/2016 3.51 EUR

Bloomberg: AIXA:GY WKN: A0WMPJ

Sector Technology




Compared to TecDAX

YTD -7.3%

1 month -10.0%

12 months -65.6%

Share data

EV (m EUR; 2016) 197.2



Free float 93.2%



SWOT


• LED lighting cycle is just in its infancy

• LED end market offers >20% volume growth p.a.

• Oligopolistic competitive situation

• No significant competitor in Asia

• Technology can be scaled to address different markets


• Very cyclical end market

• Low market share in China

• Prolonged downturn

• USD/EUR FX risk


• Martin Goetzeler (CEO)

• Dr. Bernd Schulte (COO)

AIXTRON SE produces systems for the manufacture of compound

semiconductors. The company’s tools are mainly used for the production of

LEDs, power semiconductors and memory chips. In recent years, the LED

market grew by ~20% p.a. Aixtron’s biggest customers are in China, Taiwan

and Korea. Its biggest competitor is US-based Veeco. Aixtron currently has a

market share of about 40%. The new management’s strategy focuses on

developing new end markets (e.g. OLED and power semiconductors).


• Revenues of € 190 m in 2015

• Positive EBITDA in H2 2015

• Gross margin >40%

HISTORICAL P/E EV/SALES RATIO REVENUE BREAKDOWN (LAST ACTUAL YEAR)


Next event: Annual Results 23/02/16 CAMMA GmbH 7.5

AGI 5.0

Baillie Gifford 5.0



0

1

2

3

4

5

6

01/11 01/12 01/13 01/14 01/15 01/16EV/SALES Mean Mean+SD Mean-SD

75.5%

24.5%

Equipment

Spare Parts & Service

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 192.0 190.0 238.0

Consensus 191.8 194.9 250.0

EBIT (in m EUR)

BHL -35.5 -25.0 0.1

Consensus -28.6 -18.8 2.5

EPS (EUR)

BHL -0.31 -0.15 0.01

Consensus -0.26 -0.12 0.01

2013 2014 2015e 2016e 2017e

R&D/Sales 31.3% 34.4% 29.2% 30.5% 25.2%

Capex/Sales 5.3% 6.8% 6.8% 6.8% 6.3%

Capex/Depreciation 0.3 0.8 0.9 0.8 -

ROCE -20.6% -14.0% -9.3% -6.9% 0.0%

Free cash flow yield -0.1% -6.4% -7.5% -1.7% -1.9%

Equity ratio 82.6% 77.9% 80.8% 80.2% 77.8%

Net debt / Equity -66% -64% -55% -54% -51%

Net debt / EBITDA 4.5 6.5 10.2 21.8 -3087.7

Interest cover 0.0 0.0 0.0 0.0 0.0



AIXTRON SE – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 182.9 193.8 192.0 190.0 238.0

Cost of Sales -190.3 -152.3 -147.8 -133.0 -149.9

Gross profit -7.4 41.5 44.2 57.0 88.1

Sales and marketing -29.0 -16.0 -12.0 -12.0 -14.0

General and administration -18.2 -19.3 -16.0 -16.0 -18.0

Research and development -57.2 -66.7 -56.0 -58.0 -60.0

Other operating result 16.0 2.2 4.3 4.0 4.0

EBITDA -67.9 -41.3 -20.5 -9.0 0.1

Depreciation 27.8 17.0 15.0 16.0 0.0

EBITA -95.7 -58.3 -35.5 -25.0 0.1



EBIT -95.7 -58.3 -35.5 -25.0 0.1

Financial result 0.5 1.2 0.9 1.0 1.0

Income on ordinary activities -95.2 -57.1 -34.6 -24.0 1.1


EBT -95.2 -57.1 -34.6 -24.0 1.1

Taxes -5.8 -5.4 0.0 7.2 -0.3

Net income from cont. operations -101.0 -62.5 -34.6 -16.8 0.7



Net income (adj.) -101.0 -62.5 -34.6 -16.8 0.7

No. of shares 104.4 112.2 112.2 112.2 112.2

EPS (in EUR) -0.97 -0.56 -0.31 -0.15 0.01


2013 2014 2015e 2016e 2017e

Gross margin -4.0% 21.4% 23.0% 30.0% 37.0%

EBITDA margin -37.2% -21.3% -10.7% -4.7% 0.0%

EBITA margin -52.4% -30.1% -18.5% -13.2% 0.0%

EBIT margin -52.4% -30.1% -18.5% -13.2% 0.0%

EBT margin -52.1% -29.5% -18.0% -12.6% 0.4%

Net profit margin -55.2% -32.3% -18.0% -8.8% 0.3%

Tax rate -6.1% -9.4% 0.0% 30.0% 30.0%



Sales -19.7% 6.0% -0.9% -1.0% 25.3%

EBITDA -41.2% -39.2% -50.3% -56.2% ---

EBIT -27.6% -39.1% -39.0% -29.7% ---

EBT -26.7% -40.0% -39.4% -30.7% ---

Net income (adj.) -30.5% -38.1% -44.6% -51.5% ---

EPS -32.9% -42.5% -44.6% -51.5% ---


Key figures



AIXTRON SE – Balance sheet


Fixed assets 152.8 149.2 147.2 144.2 143.2





Current assets 410.5 384.4 324.4 310.0 325.8

Inventories 66.2 81.7 80.0 79.2 99.2



Securities 138.9 151.5 151.5 151.5 151.5

Cash 167.5 116.6 58.0 44.7 33.8

Total assets 563.2 533.5 471.6 454.2 468.9

Equity and liabilities (in m EUR)



Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 0.0 0.0 0.0 0.0 0.0






AIXTRON SE – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 27.1% 28.0% 31.2% 31.7% 30.5%



Current assets 72.9% 72.0% 68.8% 68.3% 69.5%

Inventories 11.8% 15.3% 17.0% 17.4% 21.1%


Cash 29.7% 21.8% 12.3% 9.8% 7.2%







Short-term debt 0.0% 0.0% 0.0% 0.0% 0.0%





AIXTRON SE – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -101.0 -62.5 -34.6 -16.8 0.7

Depreciation 27.8 17.0 15.0 16.0 0.0


Change of provisions 3.9 -4.0 0.0 0.0 0.0

Other 0.0 0.0 0.0 0.0 0.0

Operating Cash-flow before changes in w/c -69.3 -49.5 -19.6 -0.8 0.7

Change in inventory 59.8 -15.5 1.7 0.8 -20.0

Change in accounts receivable 9.6 1.3 -0.3 0.3 -6.7

Change in accounts payable 3.8 2.9 -3.1 -0.1 3.3

Change in other working capital positions 4.3 27.1 -24.3 -0.4 22.6

Operating Cash-flow 8.3 -33.8 -45.6 -0.3 0.0







Free cash-flow -1.3 -47.0 -58.6 -13.3 -15.0


Increase/decrease in debt position 0.0 0.0 0.0 0.0 0.0


Other financing Cash-flow 100.9 -1.1 0.0 0.0 0.0

Dividend paid 0.0 0.0 0.0 0.0 0.0

Cash-flow from financing activities 100.9 -1.1 0.0 0.0 0.0

Increase/ decrease in liquid assets 99.6 -48.1 -58.6 -13.3 -15.0



Change in total cash and cash equivalents 99.6 -48.1 -58.6 -13.3 -15.0





AIXTRON SE – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.97 -0.56 -0.31 -0.15 0.01


Free Cash-flow per share -0.01 -0.42 -0.52 -0.12 -0.13


Valuation ratios

EV/Sales 4.3 4.0 1.3 1.0 0.9

EV/EBITDA -11.6 -19.0 -12.4 -21.8 3,456.2

EV/EBIT -8.3 -13.4 -7.1 -7.9 3,456.2

Price Earnings ratio (P/E) -10.9 -16.8 -13.4 -23.4 529.2


Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin -37.2% -21.3% -10.7% -4.7% 0.0%

EBIT margin -52.4% -30.1% -18.5% -13.2% 0.0%

Net return on sales -55.2% -32.3% -18.0% -8.8% 0.3%

Return on capital employed (ROCE) -20.6% -14.0% -9.3% -6.9% 0.0%

Productivity ratios




EBIT per employee 0 0 0 0 62


Financial ratios

Equity ratio 82.6% 77.9% 80.8% 80.2% 77.8%

Net financial debt (in m EUR) -306.3 -268.1 -209.5 -196.2 -185.3

Net debt / Equity -65.8% -64.5% -55.0% -53.9% -50.8%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 4.51 6.49 10.20 21.80 -3,087.72


Change Working Capital (in m EUR) -73.3 11.3 1.7 -1.0 23.3

WC /sales 43.9% 47.3% 48.6% 48.6% 48.6%





Invest. (property/plant/equity) / Depreciation 34.5% 78.0% 86.7% 81.3% -

Others

Sales CAGR (last 3 years) -38.4% -31.8% -5.5% 1.3% 7.1%

EBIT CAGR (last 3 years) -170.3% -180.2% -35.5% -36.1% -110.1%

Net income CAGR (last 3 years) -180.7% -192.3% -38.0% -45.0% -122.8%

Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) -1.3 -47.0 -58.6 -13.3 -15.0





in m EUR 2013 2014 2015e 2016e 2017e

Sales 142.1 161.1 170.7 177.5 188.2

EBIT 23.3 26.8 28.2 28.3 30.0

EBIT margin 16.4% 16.6% 16.5% 16.0% 16.0%


Free cash-flow 17.6 19.6 16.0 15.4 17.8

EPS (in EUR) 2.83 3.37 3.48 3.43 3.66

DPS (in EUR) 2.83 3.37 3.48 3.43 3.66

Dividend yield 5.2% 5.4% 4.6% 5.1% 5.4%

EV/Sales 1.7 1.8 2.0 1.8 1.7

EV/EBIT 10.1 10.6 12.4 11.0 10.4



Next event

Preliminary Results 11/02/2016

Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Amadeus FiRe AG Watch the leading indicators – Initiation of Coverage

We initiate our coverage of Amadeus FiRe with a HOLD rating and a price target of

€ 73.00. We are convinced of the business model’s quality and the medium-term

growth prospects. In the short term, however, we anticipate rather moderate

newsflow.

INVESTMENT CASE

The economic sentiment is currently marked by uncertainties, which will probably

have an influence on the group’s operating business. The fourth quarter of 2015 had

only 64 billable days, two days less than in Q3. However, compared with Q4 2014,

the quarter had two days more with a corresponding positive revenue effect.

Nonetheless, the order intake in Temporary Work has been declining since Q3 and

we did not see a sustainable turnaround in Q4. The Recruitment segment should

have grown steadily. In the Continuing Education segment, the positive trend seen

after nine months has continued, in our view.

As a result, personnel expenses should come in below budget since hiring plans are

unlikely to be met due to the difficulties in recruiting suitable employees. Against

this background, Amadeus FiRe had raised its guidance earlier in 2015 and expects

the operating profit to be on a par with the year before (previously: below 2014).

CATALYSTS

Due to the customers’ preference to now hire permanently for open positions, which

would have been filled with temporary staff some time ago, Amadeus FiRe is

expected to report a rather moderate outlook for 2016. We regard any improvement

of the macro-economic leading indicators as a signal to buy into the stock.

VALUATION

Our price target is DCF-based and an attractive dividend yield of roughly 5% should

offer the stock downside protection.

28/01/2016

Hold (n.a. )

73.00 EUR (- EUR )

Close 25/01/2016 67.42 EUR

Bloomberg: AAD GY WKN: 509310

Sector Services




Compared to SDAX

YTD -1.6%

1 month -2.8%

12 months -2.8%

Share data

EV (m EUR; 2016) 311.7



Free float 100.0%



SWOT


• Specialised personnel services provider with a focus on finance and

accounting

• Mastering the challenge of consistently recruiting qualified professionals

• High operating margins

• Market leader in the field of finance and accounting in Germany


• Temporary employment correlates strongly with economic cycle

• Highly dependent on German market

• Negative reputation of temporary employment

• General dependence on changes / regulations


• Peter Haas (CEO)

• Robert von Wülfing (CFO)

Amadeus FiRe AG is one of the leading recruiting services providers in

Germany. The company offers flexible personnel solutions recruiting

professionals and executives in the fields of accounting, office, banking and IT

services in 19 locations. Through its subsidiaries Steuer-Fachschule Dr. Endriss

and Akademie für Internationale Rechnungslegung, Amadeus FiRe offers a

broad range of complementary services, which are custom-tailored to

companies’ individual needs.


• 2015: moderate revenue growth

• 2015: EBITA on a par with last year

• By 2018-2020: revenues of € 200 m; EBITA of € 30 m



Next event: 11/02/2016 Preliminary Results Main First 10.1

Deutsche Asset & Wealth Management 9.2

Union Investment 6.1



0

5

10

15

20

25

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

89.2%

10.8%Temporary Staffing /Interim & ProjectManagement /Permanent Placement

Training

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 170.7 177.5 188.2

Consensus 0.0 0.0 0.0

EBIT (in m EUR)

BHL 28.2 28.3 30.0


EPS (EUR)

BHL 3.48 3.43 3.66

Consensus 0.00 0.00 0.00

2013 2014 2015e 2016e 2017e

R&D/Sales - - 0.0% 0.0% 0.0%

Capex/Sales 0.5% 0.9% 1.3% 1.2% 1.2%


ROCE 57.0% 61.2% 63.5% 64.2% 66.3%


Equity ratio 66.3% 64.3% 63.2% 61.3% 60.5%

Net debt / Equity -92% -95% -91% -88% -87%

Net debt / EBITDA -1.6 -1.5 -1.4 -1.3 -1.3

Interest cover 0.0 0.0 0.0 0.0 0.0



Amadeus FiRe AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 142.1 161.1 170.7 177.5 188.2

Cost of Sales -82.0 -93.2 -98.0 -101.9 -108.0

Gross profit 60.0 67.8 72.7 75.6 80.2

Sales and marketing 0.0 0.0 0.0 0.0 0.0


Research and development 0.0 0.0 0.0 0.0 0.0


EBITDA 24.1 27.6 29.0 29.1 30.8

Depreciation 0.8 0.8 0.8 0.8 0.8

EBITA 23.3 26.8 28.2 28.3 30.0



EBIT 23.3 26.8 28.2 28.3 30.0

Financial result -0.6 -0.1 0.1 -0.4 -0.4



EBT 22.7 26.7 28.3 27.9 29.6

Taxes -7.0 -8.1 -8.8 -8.6 -9.2




Net income (adj.) 14.7 17.5 18.1 17.8 19.0

No. of shares 5.2 5.2 5.2 5.2 5.2

EPS (in EUR) 2.83 3.37 3.48 3.43 3.66


2013 2014 2015e 2016e 2017e

Gross margin 42.3% 42.1% 42.6% 42.6% 42.6%

EBITDA margin 17.0% 17.1% 17.0% 16.4% 16.4%

EBITA margin 16.4% 16.6% 16.5% 16.0% 16.0%

EBIT margin 16.4% 16.6% 16.5% 16.0% 16.0%

EBT margin 16.0% 16.6% 16.6% 15.7% 15.7%


Tax rate 30.7% 30.5% 31.0% 31.0% 31.0%



Sales 3.7% 13.4% 6.0% 4.0% 6.0%

EBITDA 2.5% 14.5% 5.1% 0.5% 5.8%

EBIT 18.7% 15.1% 5.3% 0.5% 6.0%

EBT 15.6% 17.4% 5.9% -1.3% 6.1%

Net income (adj.) 9.0% 19.0% 3.4% -1.4% 6.6%

EPS 9.0% 19.0% 3.4% -1.4% 6.6%


Key figures



Amadeus FiRe AG – Balance sheet


Fixed assets 9.4 10.0 11.4 13.8 15.2





Current assets 52.2 58.1 58.8 58.2 59.7

Inventories 0.0 0.0 0.0 0.0 0.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 37.6 41.7 40.5 39.0 39.4

Total assets 61.6 68.1 70.2 72.0 74.9




Minorities 0.1 0.3 0.3 0.3 0.3







Short-term debt 0.0 0.0 0.0 0.0 0.0






Amadeus FiRe AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 15.3% 14.6% 16.2% 19.2% 20.4%



Current assets 84.8% 85.4% 83.8% 80.8% 79.7%

Inventories 0.0% 0.0% 0.0% 0.0% 0.0%


Cash 61.0% 61.2% 57.6% 54.2% 52.7%





Long-term financial debt 0.0% 0.0% - - -


Short-term debt 0.0% 0.0% - - -





Amadeus FiRe AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 14.7 17.5 18.1 17.8 19.0

Depreciation 0.8 0.8 0.8 0.8 0.8


Change of provisions 0.0 0.0 0.0 0.0 0.0

Other 1.1 2.1 0.0 -1.1 0.1


Change in inventory 0.0 0.0 0.0 0.0 0.0

Change in accounts receivable -0.1 -1.7 -1.9 -0.7 -1.1

Change in accounts payable -0.3 0.2 0.1 0.1 0.1

Change in other working capital positions 2.0 2.1 1.0 0.7 1.1








Free cash-flow 17.6 19.6 16.0 15.4 17.8





Dividend paid -15.3 -14.7 -17.5 -18.1 -17.8


Increase/ decrease in liquid assets 2.2 4.1 -1.2 -1.4 0.4



Change in total cash and cash equivalents 2.2 4.1 -1.2 -1.4 0.4





Amadeus FiRe AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.83 3.37 3.48 3.43 3.66




Valuation ratios

EV/Sales 1.7 1.8 2.0 1.8 1.7

EV/EBITDA 9.8 10.3 12.1 10.7 10.1

EV/EBIT 10.1 10.6 12.4 11.0 10.4



Dividend yield 5.2% 5.4% 4.6% 5.1% 5.4%


EBITDA margin 17.0% 17.1% 17.0% 16.4% 16.4%

EBIT margin 16.4% 16.6% 16.5% 16.0% 16.0%



Productivity ratios






Financial ratios

Equity ratio 66.3% 64.3% 63.2% 61.3% 60.5%


Net debt / Equity -92.0% -95.1% -91.2% -88.5% -87.1%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA -1.56 -1.51 -1.39 -1.34 -1.28


Change Working Capital (in m EUR) 0.4 1.5 1.7 0.7 1.0

WC /sales 9.2% 9.1% 9.6% 9.6% 9.6%






Others


EBIT CAGR (last 3 years) 7.2% 6.2% 12.9% 6.8% 3.9%

Net income CAGR (last 3 years) 6.7% 5.4% 10.3% 6.6% 2.8%

Pay out ratio 100.0% 100.1% 100.0% 100.0% 100.0%






in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Sales 108 110 106 117 130

EBIT 14 15 13 14 17

EBIT margin 13.4% 13.2% 12.1% 11.8% 12.9%

Net financial debt 22 20 13 10 5

Free cash-flow 9 -4 12 7 9

EPS (in EUR) 0.75 0.80 0.55 0.65 0.84

DPS (in EUR) 0.28 0.30 0.30 0.33 0.35

Dividend yield 3.8% 3.8% 4.3% 4.7% 5.0%

EV/Sales 1.0 1.2 1.0 0.9 0.8

EV/EBIT 7.5 8.8 8.4 7.6 5.9



Next event

Quarterly Results 15/02/2016

Change in model

Sales EBIT EPS

2015/16e --- --- ---

2016/17e --- --- ---

2017/18e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Bastei Lübbe AG Pillar of the portfolio – initiation of coverage

We initiate our coverage of Baste Lübbe with a BUY rating and a price target of

€ 8.50. We believe the company is on the right track with its strategy of developing

positively in a changing market and using digitalisation to increase its margins.

INVESTMENT CASE

Unlike a traditional publisher, Bastei Lübbe covers the entire value-added chain,

which we regard as a strategic advantage. Accordingly, the company does not only

buy in content and rights, but also develops these by itself in collaboration with

several authors. This leads to the competitive advantage that the group owns the

rights for this content in all languages and territories. On the sales side, Bastei

Lübbe co-operates with trading partners and various platforms – as all traditional

publishing houses do. When the company cannot exploit rights itself, it sells

licences, e.g. overseas. In addition, since late 2014 Bastei Lübbe has had its own

e-book shop (beam-ebooks.de), which besides Bastei Lübbe content also offers titles

from other publishers. The international launch of “oolipo“ (the company’s own

streaming portal) is slated for 2016. oolipo is a platform for digital series content.

CATALYSTS

We expect the first contracts with other publishers to supply content to oolipo to be

signed in the weeks to come. A glance at the bestseller lists shows that Bastei Lübbe

should have done well during the important Christmas trade. Titles worth noting

include: “Das Joshua-Profil“ by Sebastian Fitzek, “Der Palast der Meere“ by Rebecca

Gablé and the tenth volume of the Diary of a Wimpy Kid series “Old School” by Jeff

Kinney.

VALUATION

Our price target is based on a peer group analysis. A dividend yield of at least 4%

should limit the share price performance risks.

28/01/2016

Buy (n.a. )

8.50 EUR (- EUR )

Close 25/01/2016 6.98 EUR

Bloomberg: BST GR WKN: A1X3YY

Sector Media





YTD 3.3%

1 month 3.5%

12 months 1.4%

Share data

EV (m EUR; 2016) 105

Market Cap (m EUR) 92

No. of shares (m) 13

Free float 42.6%



SWOT


• Digitalisation is opening up growth opportunities

• Internationalisation is presenting opportunities

• Digitalisation is improving cost structures and margins

• Long-term collaboration with best-selling author Ken Follet

• New syndicated loan signed in October 2015


• Dependent upon business development of best-selling authors

• Market acceptance of digital products

• Internationalisation is not a given

• Self-publishing can weaken position of publishers


• Thomas Schierack (CEO & CFO)

• Klaus Kluge

Based in Cologne, Bastei Lübbe AG has 335 staff and is the largest family-run

SME in German publishing. Founded 60 years ago, its 12 publishers have ~

3,600 titles (fiction, non-fiction, and books for children and young people). Top

authors, such as Ken Follett, Dan Brown, Jeff Kinney, Rebecca Gablé and

Andreas Eschbach as well as bestsellers, such as the "Pillars of the Earth", "The

Da Vinci Code" and "Jesus Video" have made Bastei Lübbe the undisputed

market leader among the German language trade publishers. The company has

three segments: Books, Paperbacks/Puzzle Magazines and Non-Book.


• 2015/16: Revenue slightly down on a year ago due to deconsolidation of

Daedalic

• 2015/16: EBITDA slightly down on a year ago



Next event: 15/02/2016 Quarterly Results Stefan Lübbe 39.1

Allianz 9.8



8

10

12

2014 2015PER AVG STD + 1 STD - 1

79.8%

9.5%

10.7% Book

Novel Booklets &Puzzle Magazines

Non Book

Company Overview

2015/16e 2016/17e 2017/18e

Sales (in m EUR)

BHL 106 117 130

Consensus 108 117 127

EBIT (in m EUR)

BHL 13 14 17

Consensus 13 14 18

EPS (EUR)

BHL 0.55 0.65 0.84

Consensus 0.57 0.75 0.96

2013/14

2014/15

2015/16e

2016/17e

2017/18eR&D/Sales - - - - -

Capex/Sales 3.2% 5.7% 2.8% 2.6% 2.3%


ROCE 16.8% 15.3% 13.1% 13.5% 15.4%

Free cash flow yield 10.9% -4.0% 12.2% 7.1% 9.6%

Equity ratio 48.1% 48.8% 50.3% 52.1% 54.4%

Net debt / Equity 42% 33% 20% 14% 7%

Net debt / EBITDA 1.3 1.1 0.8 0.6 0.2

Interest cover > 10 > 10 > 10 > 10 0.0



Bastei Lübbe AG – Income statement

in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Sales 108 110 106 117 130

Own work capitalised 1 0 0 0 0

Total sales 109 111 106 117 130

Material expenses -49 -53 -50 -53 -57

Personnel expenses -19 -22 -23 -24 -25

Unusual or infrequent items 0 0 0 0 0

Other operating result -24 -18 -17 -23 -28

EBITDA 16 18 16 17 20

Depreciation 2 3 3 3 3

EBITA 14 15 13 14 17

Amortisation of goodwill 0 0 0 0 0

Amortisation of intangible assets 0 0 0 0 0

EBIT 14 15 13 14 17

Financial result -2 -2 -2 -2 -1

Income on ordinary activities 12 12 10 12 16

Extraordinary income/loss 0 0 0 0 0

EBT 12 12 10 12 16

Taxes -3 -2 -3 -4 -5

Net income from cont. operations 9 10 7 9 11

Net income from discont. operations 0 0 0 0 0

Minority interest 0 0 0 0 0

Net income (adj.) 9 11 7 9 11

No. of shares 12 13 13 13 13

EPS 0.75 0.80 0.55 0.65 0.84


2013/14 2014/15 2015/16e 2016/17e 2017/18e

Gross margin 54.5% 51.8% 52.8% 54.7% 56.2%

EBITDA margin 15.0% 16.0% 15.1% 14.5% 15.4%

EBITA margin 13.4% 13.2% 12.1% 11.8% 12.9%

EBIT margin 13.4% 13.2% 12.1% 11.8% 12.9%

EBT margin 11.2% 11.1% 9.8% 10.5% 12.2%


Tax rate 28.6% 16.6% 30.0% 30.0% 30.0%



Sales 9.4% 2.5% -3.8% 10.4% 11.1%

EBITDA 27.9% 9.3% -9.5% 6.3% 17.6%

EBIT 31.6% 0.3% -11.8% 7.8% 21.7%

EBT 25.9% 1.8% -15.3% 18.3% 28.5%

Net income (adj.) 8.8% 23.1% -31.4% 18.3% 28.5%

EPS 8.8% 7.6% -31.4% 18.3% 28.5%


Key figures



Bastei Lübbe AG – Balance sheet


Fixed assets 48 64 64 63 63

Property, plant and equipment 4 3 3 3 3

Intangible assets 11 26 26 26 26

Financial assets 4 8 8 8 8

Other long-term assets 29 27 27 27 27

Current assets 61 61 64 68 75

Inventories 19 20 16 17 18

Accounts receivable 14 17 17 18 19

Other current assets 16 10 10 10 10

Securities 0 0 0 0 0

Cash 12 14 21 24 29

Total assets 108 124 127 132 139


Shareholders’ equity 52 61 64 69 75

Shareholders’ equity (before minority) 52 58 61 66 73

Minorities 0 3 3 3 3

Non-current liabilities 30 35 35 35 35

Pension provisions 0 0 0 0 0

Other provisions 0 0 0 0 0

Long-term financial debt 30 30 30 30 30

Other long-term debt 0 5 5 5 5

Current liabilities 26 29 28 28 28

Short-term debt 4 4 4 4 4

Other accruals short-term 6 6 6 6 6

Accounts payable 13 12 12 12 12

Other liabilities 3 6 6 6 6

Total equity and liabilities 108 124 127 132 139


Bastei Lübbe AG – Balance sheet structure

Assets 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Fixed assets 44.0% 51.3% 50.0% 48.1% 45.6%



Current assets 56.0% 48.7% 50.0% 51.9% 54.4%

Inventories 17.5% 15.8% 12.2% 12.5% 12.6%


Cash 11.2% 11.0% 16.7% 18.2% 20.9%







Short-term debt 3.7% 3.4% 3.3% 3.2% 3.0%





in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e



Amortisation of goodwill & intangible assets 0 0 0 0 0

Change of provisions -1 0 0 0 0

Other 1 -11 0 0 0

Operating Cash-flow before changes in w/c 10 2 10 12 14

Change in inventory 1 -1 4 -1 -1

Change in accounts receivable 0 -3 0 -1 -1

Change in accounts payable -1 -1 0 0 0

Change in other working capital positions 2 9 0 0 0

Operating Cash-flow 13 6 15 10 12

Capex, excluding maintenance -3 -6 -3 -3 -3

Payments for acquisitions 0 -4 0 0 0

Financial investments 0 0 0 0 0

Income from asset disposals 0 0 0 0 0

Income from financial investments 0 0 0 0 0

Cash-flow from investing activities -3 -10 -3 -3 -3

Free cash-flow 9 -4 12 7 9

Capital measures 23 0 0 0 0

Increase/decrease in debt position -6 0 0 0 0

Purchase of own shares 0 0 0 0 0

Other financing Cash-flow -4 0 0 0 0

Dividend paid 0 -4 -4 -4 -4

Cash-flow from financing activities 13 -4 -4 -4 -4

Increase/ decrease in liquid assets 22 -9 8 3 5

Effects of exchange rate changes 0 0 0 0 0

Cash at beginning of period 0 22 14 21 24

Change in total cash and cash equivalents 22 -9 8 3 5

Cash at end of period 22 14 21 24 29




Bastei Lübbe AG – Ratios

2013/14 2014/15 2015/16e 2016/17e 2017/18e

Per Share Data

EPS 0.75 0.80 0.55 0.65 0.84


Free Cash-flow per share 0.82 -0.32 0.88 0.51 0.70


Valuation ratios

EV/Sales 1.0 1.2 1.0 0.9 0.8

EV/EBITDA 6.7 7.2 6.7 6.2 5.0

EV/EBIT 7.5 8.8 8.4 7.6 5.9



Dividend yield 3.8% 3.8% 4.3% 4.7% 5.0%


EBITDA margin 15.0% 16.0% 15.1% 14.5% 15.4%

EBIT margin 13.4% 13.2% 12.1% 11.8% 12.9%



Productivity ratios






Financial ratios

Equity ratio 48.1% 48.8% 50.3% 52.1% 54.4%

Net financial debt (in m EUR) 22 20 13 10 5

Net debt / Equity 41.5% 33.4% 19.8% 14.3% 6.5%

Interest cover > 10 > 10 > 10 > 10 0.0

Net debt / EBITDA 1.34 1.15 0.79 0.58 0.25

Working Capital (in m EUR) 19 24 20 22 24

Change Working Capital (in m EUR) -1 5 -4 2 2

WC /sales 18.0% 22.0% 18.9% 18.8% 18.5%

Stocks in days of sales - - - - -

Trade debtors in days of sales - - - - -

Trade creditors in days of COGS/Material cost - - - - -

Cash conversion cycle - - - - -


Others

Sales CAGR (last 3 years) - - 2.5% 2.9% 5.7%

EBIT CAGR (last 3 years) - - 5.2% -1.6% 5.0%

Net income CAGR (last 3 years) - - -2.8% 0.0% 1.4%

Pay out ratio 37.5% 37.4% 54.5% 50.7% 41.9%

Free cash-flow (in m EUR) 9 -4 12 7 9





in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,402 1,376 1,404 1,451 1,495

EBIT 30.1 76.4 73.2 74.2 79.8

EBIT margin 2.1% 5.6% 5.2% 5.1% 5.3%


Free cash-flow -28.7 67.9 8.4 9.1 32.3

EPS (in EUR) -0.99 0.85 1.30 1.40 1.65

DPS (in EUR) 0.00 0.15 0.30 0.40 0.50

Dividend yield 0.0% 1.1% 1.7% 2.8% 3.5%

EV/Sales 0.8 0.7 0.8 0.7 0.7

EV/EBIT 36.5 13.2 14.6 13.7 12.4

Price Earnings ratio (P/E) -19.0 15.8 13.4 10.2 8.7


Next event

Analyst conference 18/04/2016

Change in model

Sales EBIT EPS

2015e -1.6% -1.4% 11.9%

2016e -3.0% -7.7% -12.0%

2017e -3.0% -7.8% -11.5%

Analyst

Marc Gabriel , CIIA, CEFA

Phone: +49 (0)211 4952-313

[email protected]


BAUER Aktiengesellschaft Operations a little better in 2016

Based on lower earnings expectations, we are confirming our HOLD rating with a

new price target of € 16.00. Although 2016 will probably start better due to the

strong order book (> € 1 bn) and one-off effects will disappear, the EBIT will

probably only increase marginally.

INVESTMENT CASE

Overseas projects account for 70% of BAUER’s business. It is a leading international

provider of specialist civil engineering solutions and BAUER’s specialist construction

machines are also much sought-after worldwide. For the first time in BAUER’s

history, the order backlog reached the one billion euro mark (+30% yoy) driven by

new construction projects. In the Machinery segment, BAUER founded a joint

venture with Schlumberger for large specialist drilling equipment that should soon

generate more than € 100 m in revenue. There is the prospect of further growth in

the Resources segment (order backlog: +59% yoy), which e.g. won the largest single

contract in the history of the company for the remediation of a landfill.

CATALYSTS

• The total revenue guidance of € 1.6 bn and an EBIT of ~ € 75 m for 2015 is likely to

be achieved by the time the results are published in April thanks to one-off non-

operating effects.

• Given the market environment (oil price shock curbing investment, Middle East

and Central Asia account for 14% of group revenue), the outlook is likely to be

cautious and in line with market expectations at between € 75 m and € 85 m

(FactSet consensus € 80 m).

VALUATION

The peer group analysis indicates that BAUER shares are trading very cheaply in

terms of PBV2016e (0.5x vs. 1.0x), and in line with the group in terms of EV/EBITDA

multiple (5.9x vs. 5.8x for peers). Our peer-group fair value comes to € 18.50. We

average this with our DCF fair value of € 13.30 (WACC 6.2%, TG 0.5%) and

rounding the result down to reach our price target of € 16.00.

26/01/2016

Hold (Hold )

16.00 EUR (19.00 EUR )

Close 25/01/2016 14.39 EUR

Bloomberg: B5A GY WKN: 516810

Sector Construction





YTD -8.3%

1 month -12.4%

12 months -3.2%

Share data

EV (m EUR; 2016) 1,015



Free float 51.8%



SWOT


• Business model includes three future-oriented segments with strong

potential for synergies

• Global market leader for foundations and excavation base sealing for

dams

• High demand for infrastructure construction globally (new construction

and restoration)

• Broad diversification through roughly 600 construction projects per year

around the world (volume € 0.1 - 70 m)


• Production capacity in equipment segment not yet fully utilised after

ramp-up

• In mechanical engineering, higher competition means more pressure on

margins

• BAUER failed to deliver its earnings forecasts in the last few years

• Project delays as well as restructuring costs burdened the results.


• Thomas Bauer (CEO)

• Hartmut Beutler (CFO)

• Heinz Kaltenecker

Bauer AG activities primarily focus on deep mining as well as engineering

and construction of machinery and equipment for special foundation

construction and resource exploration.


• EBIT 2015: roughly € 75 m - net profit before minorities: € 18-23 m



Next event: 18/04/2016 Analyst conference Familie Bauer 48.2



3

13

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

46.1%

39.6%

14.2%

Construction

Equipment

Resources

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,404 1,451 1,495

Consensus 1,515 1,601 1,668

EBIT (in m EUR)

BHL 73.2 74.2 79.8

Consensus 74.2 80.4 87.0

EPS (EUR)

BHL 1.30 1.40 1.65

Consensus 1.16 1.60 1.86

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 6.4% 5.0% 6.7% 6.6% 6.6%


ROCE 2.4% 6.3% 5.9% 5.9% 6.3%


Equity ratio 26.5% 26.6% 27.4% 27.9% 28.6%

Net debt / Equity 160% 153% 145% 138% 127%

Net debt / EBITDA 5.4 3.8 3.8 3.7 3.4

Interest cover 0.7 > 10 > 10 > 10 > 10



BAUER Aktiengesellschaft – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,402 1,376 1,404 1,451 1,495


Total sales 1,417 1,417 1,445 1,492 1,536





EBITDA 124.0 171.0 167.7 170.6 178.2

Depreciation 93.9 94.6 94.6 96.5 98.4

EBITA 30.1 76.4 73.2 74.2 79.8



EBIT 30.1 76.4 73.2 74.2 79.8


Income on ordinary activities -6.0 37.8 37.6 39.2 44.9


EBT -6.0 37.8 37.6 39.2 44.9

Taxes -13.5 -22.1 -13.5 -13.3 -14.8

Net income from cont. operations -19.4 15.7 24.1 25.9 30.1


Minority interest 2.5 -1.2 -1.8 -1.8 -1.8

Net income (adj.) -16.9 14.5 22.3 24.1 28.3

No. of shares 17.1 17.1 17.1 17.1 17.1

EPS -0.99 0.85 1.30 1.40 1.65


2013 2014 2015e 2016e 2017e

Gross margin 46.1% 45.5% 47.0% 46.6% 46.5%

EBITDA margin 8.8% 12.4% 11.9% 11.8% 11.9%

EBITA margin 2.1% 5.6% 5.2% 5.1% 5.3%

EBIT margin 2.1% 5.6% 5.2% 5.1% 5.3%

EBT margin -0.4% 2.7% 2.7% 2.7% 3.0%

Net profit margin -1.2% 1.1% 1.6% 1.7% 1.9%

Tax rate -226.2% 58.4% 36.0% 34.0% 33.0%



Sales 4.3% -1.9% 2.0% 3.4% 3.0%

EBITDA -24.3% 37.9% -1.9% 1.7% 4.5%

EBIT -58.2% >100% -4.3% 1.4% 7.6%

EBT --- --- -0.6% 4.3% 14.5%

Net income (adj.) --- --- 53.7% 8.2% 17.4%

EPS --- --- 53.7% 8.2% 17.4%


Key figures



BAUER Aktiengesellschaft – Balance sheet


Fixed assets 587.8 594.8 594.8 594.8 594.8





Current assets 998.0 980.3 1,004 1,043 1,079

Inventories 419.4 439.2 452.4 482.4 497.4



Securities 0.0 0.0 0.0 0.0 0.0

Cash 57.2 41.8 47.7 41.6 67.0

Total assets 1,586 1,575 1,599 1,638 1,673




Minorities 22.8 19.6 19.6 19.6 19.6







Short-term debt 447.6 293.6 293.6 293.6 293.6




Total equity and liabilities 1,586 1,575 1,599 1,638 1,673


BAUER Aktiengesellschaft – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 37.1% 37.8% 37.2% 36.3% 35.5%



Current assets 62.9% 62.2% 62.8% 63.7% 64.5%

Inventories 26.4% 27.9% 28.3% 29.4% 29.7%


Cash 3.6% 2.7% 3.0% 2.5% 4.0%







Short-term debt 28.2% 18.6% 18.4% 17.9% 17.5%





BAUER Aktiengesellschaft – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -16.9 14.5 22.3 24.1 28.3

Depreciation 93.9 94.6 94.6 96.5 98.4



Other 0.0 4.1 0.0 0.0 0.0


Change in inventory -22.7 -37.3 -13.2 -30.0 -15.0

Change in accounts receivable -95.7 47.3 -5.0 -15.0 5.0

Change in accounts payable 11.1 20.2 4.4 30.0 14.0

Change in other working capital positions 71.8 -28.2 0.0 0.0 0.0




Financial investments 0.0 -5.2 0.0 0.0 0.0




Free cash-flow -28.7 67.9 8.4 9.1 32.3


Increase/decrease in debt position 83.3 -46.5 0.0 -10.0 0.0



Dividend paid -6.6 -2.9 -2.6 -5.1 -6.9

Cash-flow from financing activities 43.6 -86.9 -2.6 -15.1 -6.9

Increase/ decrease in liquid assets 14.8 -18.9 5.9 -6.1 25.4



Change in total cash and cash equivalents 12.0 -15.4 5.9 -6.1 25.4





BAUER Aktiengesellschaft – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.99 0.85 1.30 1.40 1.65




Valuation ratios

EV/Sales 0.8 0.7 0.8 0.7 0.7

EV/EBITDA 8.8 5.9 6.4 6.0 5.6

EV/EBIT 36.5 13.2 14.6 13.7 12.4



Dividend yield 0.0% 1.1% 1.7% 2.8% 3.5%


EBITDA margin 8.8% 12.4% 11.9% 11.8% 11.9%

EBIT margin 2.1% 5.6% 5.2% 5.1% 5.3%

Net return on sales -1.2% 1.1% 1.6% 1.7% 1.9%


Productivity ratios


Operating leverage -13.6 -81.5 -2.1 0.4 2.5




Financial ratios

Equity ratio 26.5% 26.6% 27.4% 27.9% 28.6%


Net debt / Equity 159.7% 153.4% 145.2% 138.3% 126.8%

Interest cover 0.7 > 10 > 10 > 10 > 10

Net debt / EBITDA 5.41 3.76 3.80 3.71 3.41


Change Working Capital (in m EUR) 39.7 9.4 13.8 15.0 -4.0

WC /sales 46.8% 48.4% 48.4% 47.8% 46.2%






Others


EBIT CAGR (last 3 years) -30.2% -2.4% 0.5% 35.1% 1.5%


Pay out ratio 0.0% 17.7% 23.1% 28.5% 30.3%

Free cash-flow (in m EUR) -28.7 67.9 8.4 9.1 32.3





in m EUR 2013 2014 2015e 2016e 2017e

Sales 15,958 15,202 14,631 14,923 15,167

EBIT 221.9 146.8 153.3 187.0 181.4

EBIT margin 1.4% 1.0% 1.0% 1.3% 1.2%

Net financial debt 1,628 1,997 2,145 2,157 2,172

Free cash-flow 234.9 -337.0 -117.6 20.0 18.8

EPS (in EUR) 2.84 2.03 1.51 1.93 1.84

DPS (in EUR) 0.75 0.80 0.85 0.90 0.95

Dividend yield 2.0% 2.6% 3.0% 3.3% 3.5%

EV/Sales 0.2 0.3 0.3 0.3 0.3

EV/EBIT 16.7 27.1 26.4 21.5 22.3



Next event

RPC 31/03/2016

Change in model

Sales EBIT EPS

2015e -2.9% -17.2% -25.1%

2016e -2.9% -16.5% -22.8%

2017e -5.6% -20.1% -27.6%

Analyst


Phone: +49 (0)211 4952-313

[email protected]


BayWa AG EBIT harvest once again in Q4

We reduce our price target for BayWa to € 32.00. The revision of the earnings

expectations is already reflected in the share price, in our view. We anticipate a

strong final quarter in 2015 and an improvement in the current financial year.

INVESTMENT CASE

The growth drivers in BayWa’s portfolio remain Agricultural Trade and Renewable

Energy. The group is pressing on with its internationalisation strategy in these

segments. In the agricultural business, the company is planning to expand the

trading volume to 40 million tonnes by 2020 (2015e: >30 million tonnes), which

should be realised much quicker, given the latest acquisitions. The subsidiary

BayWa r.e. is expanding its wind and solar park business increasingly in the

United States and in Asia.

CATALYSTS

• The company may release preliminary figures for 2015 as early as the beginning

of March. Like last year, BayWa will probably have raked in most of its earnings

in Q4. We project a Q4 EBIT of € 78 m.

• This would put the FY EBIT at € 153 m, which would be below what we had

expected up to now. However, this is already reflected in the current FactSet

consensus (€ 154 m) and thus, we believe that the stock’s recent upward trend is

set to continue.

• The Materials Trade segment is likely to fuel exit speculation, because its 2015

results have not been convincing so far; plus there is € 300 m in tied-up capital.

VALUATION

Our reduced price target of € 32.00 is based on an SOTP valuation, primarily due to

the reduced expectations and the increased net debt. We have only applied a

weighting of two thirds to these negative factors as the price risks for the cereals

stocks are covered since they can be converted into cash quickly. BayWa still has a

high net asset value (real estate assets ~ € 870 m) and thus, the share price has

probably bottomed out at € 27.00.

26/01/2016

Hold (Hold )

32.00 EUR (36.00 EUR )

Close 25/01/2016 27.53 EUR

Bloomberg: BYW6 GY WKN: 519406

Sector Retail




Compared to SDAX

YTD 5.4%

1 month 3.5%

12 months -30.4%

Share data

EV (m EUR; 2016) 4,029



Free float 39.7%



SWOT


• Expansion of the international agricultural business: Aim is to trade 40

million tonnes of cereals (CAGR 5%) by 2020

• Strong order backlog for agricultural equipment, esp. strong trailer

business

• Exit from traditional low-margin energy trading conceivable

• Renewable energies segment increases earnings potential.

• Catch-up effects expected in the German materials business


• Earnings trend in agricultural business shaped by volatile markets

• Heating oil sales have been falling for years

• Building Materials segment cannot meet earnings expectations

• Regulatory changes could weigh on Renewable Energy segment

• Anti-trust authorities are investigating allegations of pesticide price

fixing


• Prof. Klaus-Josef Lutz (CEO)

• Andreas Helber (CFO)

• Matthias Taft

• Roland Schuler

• Reinhard Wolf

BayWa AG is an international trading and services group with a focus on

agriculture, building materials and energy. The company’s largest segment,

Agriculture, trades in agricultural products as well as raw materials. The

Energy segment is involved in the trade of fossil fuels and builds and

operates renewable energy plants. The Building Materials segment mainly

trades in building materials. The company was founded in 1923 and is

headquartered in Munich, Germany.


• 2015: Slight increase in revenue •



Next event: 31/03/2016 RPC Bayerische Raiffeisen-Beteiligungs-AG 35.2

Raiffeisen Agrar Invest GmbH 25.1



10

20

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

49.0%

35.0%

16.0%

Agricultural Trade

Energy

Building Materials

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 14,631 14,923 15,167

Consensus 15,202 15,772 16,306

EBIT (in m EUR)

BHL 153.3 187.0 181.4

Consensus 153.8 199.5 195.3

EPS (EUR)

BHL 1.51 1.93 1.84

Consensus 2.02 2.67 2.55

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 0.7% 0.5% 1.0% 0.9% 0.8%


ROCE 6.4% 3.7% 3.8% 4.6% 4.4%

Free cash flow yield 23.6% -31.9% -11.8% 2.0% 1.9%

Equity ratio 23.6% 20.5% 20.6% 21.1% 21.5%

Net debt / Equity 138% 177% 186% 181% 178%

Net debt / EBITDA 4.5 7.5 7.7 6.9 7.1

Interest cover > 10 > 10 > 10 > 10 > 10



BayWa AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 15,958 15,202 14,631 14,923 15,167

Own work capitalised 29.7 -37.8 40.0 42.0 45.0

Total sales 15,987 15,164 14,671 14,965 15,212

Material expenses -14,668 -13,817 -13,304 -13,570 -13,791




EBITDA 360.3 264.6 280.3 314.0 306.4

Depreciation 138.5 117.8 127.0 127.0 125.0

EBITA 221.9 146.8 153.3 187.0 181.4



EBIT 221.9 146.8 153.3 187.0 181.4




EBT 168.2 87.6 98.0 125.3 119.4

Taxes -47.0 2.8 -24.5 -36.3 -34.6




Net income (adj.) 98.2 70.2 52.1 66.7 63.6

No. of shares 34.5 34.5 34.5 34.5 34.5

EPS 2.84 2.03 1.51 1.93 1.84


2013 2014 2015e 2016e 2017e

Gross margin 8.1% 9.1% 9.1% 9.1% 9.1%

EBITDA margin 2.3% 1.7% 1.9% 2.1% 2.0%

EBITA margin 1.4% 1.0% 1.0% 1.3% 1.2%

EBIT margin 1.4% 1.0% 1.0% 1.3% 1.2%

EBT margin 1.1% 0.6% 0.7% 0.8% 0.8%


Tax rate 27.9% -3.2% 25.0% 29.0% 29.0%



Sales 51.5% -4.7% -3.8% 2.0% 1.6%

EBITDA 17.5% -26.6% 5.9% 12.0% -2.4%

EBIT 18.8% -33.8% 4.4% 22.0% -3.0%

EBT 37.2% -47.9% 11.8% 27.9% -4.7%

Net income (adj.) 1.5% -28.5% -25.8% 28.1% -4.7%

EPS 0.9% -28.5% -25.8% 28.1% -4.7%


Key figures



BayWa AG – Balance sheet


Fixed assets 1,915 2,104 2,119 2,134 2,132

Property, plant and equipment 1,074 1,163 1,178 1,193 1,193




Current assets 3,100 3,382 3,482 3,511 3,554

Inventories 1,836 1,987 2,067 2,087 2,129

Accounts receivable 1,060 1,240 1,302 1,315 1,323


Securities 45.6 20.6 20.6 20.6 20.6

Cash 92.1 106.1 64.2 59.8 52.7

Total assets 5,015 5,486 5,601 5,645 5,686


Shareholders’ equity 1,182 1,127 1,152 1,189 1,222


Minorities 267.8 265.0 265.0 265.0 265.0

Non-current liabilities 1,419 1,903 1,935 1,945 1,956



Long-term financial debt 628.6 952.5 1,000 1,010 1,020


Current liabilities 2,414 2,456 2,514 2,511 2,509

Short-term debt 1,137 1,171 1,229 1,227 1,225






BayWa AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 38.2% 38.4% 37.8% 37.8% 37.5%



Current assets 61.8% 61.6% 62.2% 62.2% 62.5%

Inventories 36.6% 36.2% 36.9% 37.0% 37.4%


Cash 1.8% 1.9% 1.1% 1.1% 0.9%







Short-term debt 22.7% 21.3% 21.9% 21.7% 21.5%





BayWa AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 98.2 70.2 52.1 66.7 63.6

Depreciation 138.5 117.8 127.0 127.0 125.0


Change of provisions -1.6 -72.4 -12.3 3.9 3.9

Other 24.0 0.0 0.0 0.0 0.1


Change in inventory 230.0 -159.5 -79.5 -20.7 -41.7

Change in accounts receivable 0.0 0.0 -62.0 -13.0 -8.2


Change in other working capital positions -130.0 5.7 -10.1 -9.8 -9.5

Operating Cash-flow 219.3 -112.4 24.1 161.7 142.4


Payments for acquisitions -175.0 -142.2 0.0 0.0 0.0




Cash-flow from investing activities 15.6 -224.7 -141.7 -141.7 -123.6

Free cash-flow 234.9 -337.0 -117.6 20.0 18.8


Increase/decrease in debt position -184.4 389.2 106.2 7.7 7.8


Other financing Cash-flow -9.6 -9.5 -2.8 -2.7 -2.7

Dividend paid -25.4 -33.0 -27.6 -29.3 -31.1

Cash-flow from financing activities -217.1 351.0 75.8 -24.3 -25.9

Increase/ decrease in liquid assets 17.8 13.9 -41.8 -4.4 -7.1



Change in total cash and cash equivalents 8.8 13.9 -41.8 -4.4 -7.1





BayWa AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.84 2.03 1.51 1.93 1.84


Free Cash-flow per share 6.80 -9.76 -3.41 0.58 0.55


Valuation ratios

EV/Sales 0.2 0.3 0.3 0.3 0.3

EV/EBITDA 10.3 15.1 14.4 12.8 13.2

EV/EBIT 16.7 27.1 26.4 21.5 22.3



Dividend yield 2.0% 2.6% 3.0% 3.3% 3.5%


EBITDA margin 2.3% 1.7% 1.9% 2.1% 2.0%

EBIT margin 1.4% 1.0% 1.0% 1.3% 1.2%



Productivity ratios


Operating leverage 0.4 7.1 -1.2 11.0 -1.8




Financial ratios

Equity ratio 23.6% 20.5% 20.6% 21.1% 21.5%

Net financial debt (in m EUR) 1,628 1,997 2,145 2,157 2,172

Net debt / Equity 137.7% 177.1% 186.2% 181.4% 177.8%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 4.52 7.54 7.65 6.87 7.09

Working Capital (in m EUR) 2,130 2,482 2,615 2,641 2,682


WC /sales 13.3% 16.3% 17.9% 17.7% 17.7%






Others

Sales CAGR (last 3 years) 26.4% 16.6% 11.6% -2.2% -0.1%

EBIT CAGR (last 3 years) 19.9% -0.5% -6.4% -5.5% 7.3%

Net income CAGR (last 3 years) 24.9% 11.6% -18.6% -12.1% -3.2%

Pay out ratio 26.4% 39.3% 56.3% 46.6% 51.6%

Free cash-flow (in m EUR) 234.9 -337.0 -117.6 20.0 18.8





in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Sales 260.7 276.0 265.0 278.3 292.2

EBIT 18.5 13.2 10.3 16.5 18.6

EBIT margin 7.1% 4.8% 3.9% 5.9% 6.4%


Free cash-flow 17.6 -55.5 9.6 9.4 11.3

EPS (in EUR) 0.19 0.06 0.07 0.12 0.13

DPS (in EUR) 0.10 0.05 0.05 0.10 0.10

Dividend yield 3.0% 1.3% 1.3% 2.5% 2.5%

EV/Sales 1.4 1.2 1.2 1.1 1.1

EV/EBIT 19.2 25.0 31.2 19.2 17.0



Next event


Change in model

Sales EBIT EPS

2015/16e --- --- ---

2016/17e --- --- ---

2017/18e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Borussia Dortmund GmbH & Co. KGaA There is still potential

Borussia Dortmund has performed well in all competitions so far this season and

thus laid the foundation for a solid second half of the year. We therefore still feel

comfortable with our BUY rating for this stock and an unchanged price target of

€ 5.00.

INVESTMENT CASE

Due to the capital measures carried out about a year ago resulting in the

strengthening of equity capital, and the strategic co-operation with important

sponsors, Borussia Dortmund is able to weather even less successful years from an

economic perspective. Nevertheless, the recent successes have further strengthened

its foundation for continued growth. BVB is regarded as the top contender for the

title of the Europa League (odds at bwin as per 25/01/2016: Borussia Dortmund

17/2, Liverpool, Manchester United and Naples all 12:1). In addition, by reaching the

quarter finals in the DFB Cup and being in the runner-up spot in the Bundesliga,

BVB is in an optimal position to qualify for the Champions League again next

season. From an investor’s point of view, it should be noted that the risk management

still has the highest priority, i.e. avoiding economic risks or keeping them at a

manageable level.

CATALYSTS

In the Bundesliga, BVB next faces Ingolstadt and then plays away against

Hertha BSC. In the DFB Cup, the team will play in Stuttgart on 9 February. This

match will also be broadcast on public TV. In the Europa League, BVB will meet

FC Porto in a home match on 18 February. A week later, the team will play the

return match in Portugal. All in all, the tasks ahead are not easy at first glance, but

still manageable.

VALUATION

Our price target of € 5.00 still takes account of the adjusted value of the squad and

the brand value minus a risk discount of 25%.

28/01/2016

Buy (Buy )

5.00 EUR (5.00 EUR )

Close 25/01/2016 3.93 EUR

Bloomberg: BVB GY WKN: 549309

Sector Media





YTD 6.9%

1 month 8.2%

12 months 10.8%

Share data

EV (m EUR; 2016) 321.7



Free float 60.8%



SWOT


• Sporting success has a leverage effect on the revenue structure

• Continuity in sporting and commercial management

• Improvement of infrastructure


• It is a challenge to accommodate both sporting and financial objectives

• There is a particular need to improve marketing in Asia

• Sporting success cannot be relied upon

• Sporting injuries and periods of weak form are imponderables


• Hans-Joachim Watzke (CEO)

• Thomas Tress (CFO)

Borussia Dortmund GmbH & Co. KGaA operates a professional football club.

The company generates most of its revenues from ticketing, marketing

television broadcast rights, advertising, the sale of merchandise, and

transfers. The company was founded in 1909.


• 2014/15: Revenue of more than € 220 m • 2018: Revenues of € 300 m



Next event: 26/02/2016 Quarterly Results Evonik 14.8

Bernd Geske 7.9

BV Borussia 09 e.V. Dortmund 4.8



0

10

20

30

40

50

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

29.7%

27.4%

14.5%

14.2%

9.6%4.5%

TV Marketing

Advertising

Match Operations

Merchandising

Conference, Catering, Miscellaneous

Transfer Deals

Company Overview

2015/16e 2016/17e 2017/18e

Sales (in m EUR)

BHL 265.0 278.3 292.2

Consensus 290.9 302.4 323.5

EBIT (in m EUR)

BHL 10.3 16.5 18.6

Consensus 27.4 12.0 12.9

EPS (EUR)

BHL 0.07 0.12 0.13

Consensus 0.25 0.10 0.10

2013/14

2014/15

2015/16e

2016/17e

2017/18eR&D/Sales - - - - -

Capex/Sales 4.2% 3.8% 19.7% 18.0% 17.1%


ROCE 8.9% 4.3% 3.3% 5.3% 5.8%


Equity ratio 49.7% 74.0% 73.2% 73.5% 73.5%

Net debt / Equity 30% -11% -14% -15% -16%

Net debt / EBITDA 0.9 -0.6 -0.7 -0.7 -0.7

Interest cover > 10 > 10 0.0 0.0 0.0



Borussia Dortmund GmbH & Co. KGaA – Income statement

in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Sales 260.7 276.0 265.0 278.3 292.2


Total sales 260.7 276.0 265.0 278.3 292.2





EBITDA 49.1 55.6 58.3 64.5 66.6

Depreciation 30.7 42.4 48.0 48.0 48.0

EBITA 18.5 13.2 10.3 16.5 18.6



EBIT 18.5 13.2 10.3 16.5 18.6




EBT 14.6 6.0 9.6 15.8 17.9

Taxes -2.6 -0.5 -3.0 -4.9 -5.5



Minority interest -0.3 0.0 0.0 0.0 0.0

Net income (adj.) 11.7 5.5 6.6 10.9 12.3

No. of shares 61.4 92.0 92.0 92.0 92.0

EPS 0.19 0.06 0.07 0.12 0.13


2013/14 2014/15 2015/16e 2016/17e 2017/18e

Gross margin 92.2% 92.5% 92.2% 92.2% 92.2%

EBITDA margin 18.8% 20.1% 22.0% 23.2% 22.8%

EBITA margin 7.1% 4.8% 3.9% 5.9% 6.4%

EBIT margin 7.1% 4.8% 3.9% 5.9% 6.4%

EBT margin 5.6% 2.2% 3.6% 5.7% 6.1%


Tax rate 18.0% 7.8% 31.0% 31.0% 31.0%



Sales -14.5% 5.9% -4.0% 5.0% 5.0%

EBITDA -43.9% 13.2% 4.9% 10.7% 3.2%

EBIT -71.7% -28.7% -21.7% 60.3% 12.3%

EBT -75.7% -58.9% 60.0% 64.7% 12.9%

Net income (adj.) -77.1% -52.6% 19.7% 64.7% 12.9%

EPS -77.1% -68.3% 19.7% 64.7% 12.9%


Key figures



Borussia Dortmund GmbH & Co. KGaA – Balance sheet


Fixed assets 249.5 289.5 293.7 295.7 297.7





Current assets 42.8 97.0 100.0 104.8 106.9

Inventories 5.9 9.4 8.0 8.0 8.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 17.9 53.7 60.0 64.8 66.9

Total assets 292.3 386.5 393.6 400.4 404.5




Minorities 0.3 0.3 0.3 0.3 0.3







Short-term debt 8.9 0.0 0.0 0.0 0.0






Borussia Dortmund GmbH & Co. KGaA – Balance sheet structure

Assets 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Fixed assets 85.4% 74.9% 74.6% 73.8% 73.6%



Current assets 14.6% 25.1% 25.4% 26.2% 26.4%

Inventories 2.0% 2.4% 2.0% 2.0% 2.0%


Cash 6.1% 13.9% 15.2% 16.2% 16.5%







Short-term debt 3.0% 0.0% 0.0% 0.0% 0.0%





Borussia Dortmund GmbH & Co. KGaA – Cash flow statement

in m EUR 2013/14 2014/15 2015/16e 2016/17e 2017/18e

Net income (adj.) 14.6 5.5 6.6 10.9 12.3

Depreciation 30.7 42.4 48.0 48.0 48.0



Other -65.2 -12.2 0.0 0.0 0.0

Operating Cash-flow before changes in w/c -19.9 35.8 54.6 58.9 60.3

Change in inventory 1.6 -3.5 1.4 0.0 0.0



Change in other working capital positions -10.2 -5.3 -5.6 0.0 0.0








Free cash-flow 17.6 -55.5 9.6 9.4 11.3


Increase/decrease in debt position -5.7 -42.9 -1.6 0.0 0.0



Dividend paid -6.1 -6.1 -4.6 -4.6 -9.2

Cash-flow from financing activities -12.3 91.4 -3.4 -4.6 -9.2









Borussia Dortmund GmbH & Co. KGaA – Ratios

2013/14 2014/15 2015/16e 2016/17e 2017/18e

Per Share Data

EPS 0.19 0.06 0.07 0.12 0.13




Valuation ratios

EV/Sales 1.4 1.2 1.2 1.1 1.1

EV/EBITDA 7.2 5.9 5.5 4.9 4.7

EV/EBIT 19.2 25.0 31.2 19.2 17.0



Dividend yield 3.0% 1.3% 1.3% 2.5% 2.5%


EBITDA margin 18.8% 20.1% 22.0% 23.2% 22.8%

EBIT margin 7.1% 4.8% 3.9% 5.9% 6.4%



Productivity ratios


Operating leverage 4.9 -4.9 5.4 12.1 2.5




Financial ratios

Equity ratio 49.7% 74.0% 73.2% 73.5% 73.5%


Net debt / Equity 29.8% -11.2% -13.9% -15.2% -15.8%

Interest cover > 10 > 10 0.0 0.0 0.0

Net debt / EBITDA 0.88 -0.58 -0.69 -0.69 -0.70


Change Working Capital (in m EUR) -56.5 13.5 -12.7 -0.5 -1.0

WC /sales 1.0% 5.9% 1.3% 1.1% 0.7%






Others

Sales CAGR (last 3 years) 19.8% 8.6% -4.6% 2.2% 1.9%


Net income CAGR (last 3 years) 30.0% -41.3% -49.3% -2.2% 30.6%

Pay out ratio 52.7% 83.2% 69.4% 84.3% 74.7%

Free cash-flow (in m EUR) 17.6 -55.5 9.6 9.4 11.3





in m EUR 2013 2014 2015e 2016e 2017e

Sales 57 78 115 147 170

EBIT 32 46 69 90 98

EBIT margin 55.6% 59.6% 60.1% 60.9% 57.7%

Net financial debt 271 521 857 1,047 1,184

Free cash-flow -11 -29 -429 -195 -148

EPS (in EUR) 0.25 0.36 0.45 0.51 0.52

DPS (in EUR) 0.10 0.15 0.20 0.25 0.25

Dividend yield 2.7% 3.1% 2.5% 3.3% 3.3%

EV/Sales 5.2 11.2 12.6 11.1 10.4

EV/EBIT 9.4 18.9 21.0 18.2 17.9



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- -0.2%

2017e --- --- -0.2%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Capital Stage AG Share price drop as buying opportunity

We reiterate our BUY rating for Capital Stage with a price target of € 10.60. Of late,

the stock has come under pressure due to macro-economic issues such as China. We

recognise that many market players still view Capital Stage as a traditional solar

manufacturer, not realising that the company can generate stable and particularly

predictable cash flows that are insensitive to economic cycles.

INVESTMENT CASE

• Risk-averse business model: Capital Stage operates a broadly diversified

portfolio of 80 solar and wind farms in Germany, France, Italy and the UK with a

total output of some 550 MWp. It generates stable and predictable revenues

resulting in sustainable cash flows regardless of economic conditions. We expect

the company to increase the capacity to 1,000 MWp in the medium term.

• High-quality portfolio limiting risk: Capital Stage is focused on investments in

high-quality plants in selected European markets with both secure and attractive

general conditions. Guaranteed feed-in tariffs (FIT) secure steady revenues and

attractive yields.

• Own subsidiary for operational management: With Solar Service, Capital Stage

has its own subsidiary in charge of the technical management of many of the

company’s owned solar parks. The company also offers its services to third

parties. This opens up additional earnings potential.

CATALYSTS

In light of the company’s strong acquisition pipeline, we expect to see steady

positive newsflow. The company’s guidance is always based on the current portfolio,

which means that acquisitions should lead to systematic increases in the company’s

forecast.

VALUATION

The DCF-based price target of € 10.60 takes account of a portfolio of 600 MWp.

28/01/2016

Buy (Buy )

10.60 EUR (10.60 EUR )

Close 25/01/2016 7.56 EUR

Bloomberg: CAP GY WKN: 609500

Sector Financial Services




Compared to SDAX

YTD 4.3%

1 month 1.8%

12 months 44.5%

Share data

EV (m EUR; 2016) 1,625



Free float 51.2%



SWOT


• Low-risk business model

• New projects (e.g. in the UK) improving regional diversification

• Focused on investment in "safe" countries

• Funding options represent opportunities

• Strong acquisition pipeline


• Depends on national subsidy programmes for renewable energies

• Raising capital to fund projects represents risk

• Technical risk and degradation


• Prof. Dr. Klaus-Dieter Maubach (CEO)

• Dr. Christoph Husmann (CFO)

Capital Stage invests in solar parks and wind farms. The company is

Germany’s largest solar park operator.


• 2015: Sales increase to more than € 110 m

• 2015: operating EBIT should increase to more than € 52 m

• -



Next event: 31/03/2016 Annual Results AMCO Service GmbH (Fam. Büll) 20.4

Dr. Liedtke VV 9.9

Blue Elephant 7.1



-10

10

30

50

2011 2012 2013 2014 2015 2016

PER AVG STD + 1 STD - 1

79.2%

9.4%

7.0%3,5%

0.8%PV Parks

Wind Farms

Financial Investments

PV Services

Administration

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 115 147 170


EBIT (in m EUR)

BHL 69 90 98

Consensus 56 71 81

EPS (EUR)

BHL 0.45 0.51 0.52

Consensus 0.35 0.33 0.37

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 1.2% 45.9% 223.3% 93.9% 60.5%


ROCE 5.9% 5.3% 5.9% 6.4% 6.5%


Equity ratio 35.0% 24.7% 19.0% 17.7% 17.2%

Net debt / Equity 131% 214% 322% 361% 382%

Net debt / EBITDA 5.4 6.1 7.5 7.3 7.8

Interest cover > 10 > 10 > 10 > 10 > 10



Capital Stage AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 57 78 115 147 170


Total sales 57 78 115 147 170




Other operating result 6 18 10 5 -9

EBITDA 50 85 114 143 151


EBITA 32 46 69 90 98



EBIT 32 46 69 90 98




EBT 16 24 39 46 52

Taxes -2 2 -6 -7 -13




Net income (adj.) 14 26 33 39 39

No. of shares 56 72 74 75 75

EPS 0.25 0.36 0.45 0.51 0.52


2013 2014 2015e 2016e 2017e

Gross margin 88.7% 95.1% 96.7% 98.6% 98.8%

EBITDA margin 88.4% 109.6% 99.2% 96.9% 88.8%

EBITA margin 55.6% 59.6% 60.1% 60.9% 57.7%

EBIT margin 55.6% 59.6% 60.1% 60.9% 57.7%

EBT margin 27.8% 30.7% 34.1% 31.0% 30.7%


Tax rate 11.3% -9.2% 15.0% 15.0% 25.0%



Sales 26.3% 36.6% 47.8% 27.8% 15.8%

EBITDA 49.4% 69.2% 33.8% 24.9% 6.1%

EBIT 54.1% 46.4% 49.0% 29.5% 9.7%

EBT 66.8% 50.7% 64.4% 16.0% 14.7%

Net income (adj.) 53.6% 85.5% 28.0% 16.0% 1.2%

EPS 53.6% 44.0% 23.8% 14.4% 1.2%


Key figures



Capital Stage AG – Balance sheet


Fixed assets 524 843 1,305 1,540 1,740

Property, plant and equipment 408 676 1,015 1,255 1,430









Cash 56 119 53 53 6

Total assets 593 986 1,400 1,640 1,799





Non-current liabilities 355 676 1,036 1,226 1,336



Long-term financial debt 304 595 850 1,020 1,100







Total equity and liabilities 593 986 1,400 1,640 1,799


Capital Stage AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 88.4% 85.5% 93.2% 93.9% 96.7%



Current assets 11.6% 14.5% 6.8% 6.1% 3.3%

Inventories 0.3% 0.2% 0.2% 0.2% 0.3%


Cash 9.4% 12.0% 3.8% 3.2% 0.3%







Short-term debt 3.9% 4.5% 4.3% 4.9% 5.0%





Capital Stage AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 14 26 33 39 39



Change of provisions 0 0 1 0 0

Other 3 -12 1 0 0


Change in inventory 2 0 -1 -1 -1

Change in accounts receivable 0 -5 -8 -3 -3

Change in accounts payable -2 11 12 3 3

Change in other working capital positions 0 -3 -6 2 14



Payments for acquisitions -46 -50 -250 -150 -150





Free cash-flow -11 -29 -429 -195 -148




Other financing Cash-flow -12 -23 104 20 30

Dividend paid -4 -4 -11 -15 -19

Cash-flow from financing activities 32 91 364 195 101

Increase/ decrease in liquid assets 21 62 -65 0 -47



Change in total cash and cash equivalents 21 62 -65 0 -47





Capital Stage AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.25 0.36 0.45 0.51 0.52




Valuation ratios

EV/Sales 5.2 11.2 12.6 11.1 10.4

EV/EBITDA 5.9 10.3 12.7 11.4 11.7

EV/EBIT 9.4 18.9 21.0 18.2 17.9



Dividend yield 2.7% 3.1% 2.5% 3.3% 3.3%


EBITDA margin 88.4% 109.6% 99.2% 96.9% 88.8%

EBIT margin 55.6% 59.6% 60.1% 60.9% 57.7%



Productivity ratios

Capital turnover 927.7% 1,080.9% 1,130.4% 1,044.9% 1,020.6%


Sales per employee 850,612 1,179,182 1,642,857 2,100,000 2,431,429

EBIT per employee 472,672 702,530 987,143 1,278,571 1,402,857


Financial ratios

Equity ratio 35.0% 24.7% 19.0% 17.7% 17.2%

Net financial debt (in m EUR) 271 521 857 1,047 1,184

Net debt / Equity 130.8% 213.8% 322.2% 361.3% 381.8%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 5.38 6.10 7.51 7.35 7.83

Working Capital (in m EUR) 4 -2 -5 -4 -3

Change Working Capital (in m EUR) 1 -6 -3 1 1

WC /sales 7.8% -2.6% -4.3% -2.7% -1.8%






Others




Pay out ratio 39.8% 41.5% 44.7% 48.8% 48.2%

Free cash-flow (in m EUR) -11 -29 -429 -195 -148





in m EUR 2013 2014 2015e 2016e 2017e

Sales 536.2 523.8 529.0 544.9 561.2

EBIT 28.9 32.6 36.0 38.8 41.8

EBIT margin 5.4% 6.2% 6.8% 7.1% 7.5%


Free cash-flow 13.6 28.1 12.7 23.8 27.7

EPS (in EUR) 3.40 3.07 3.35 3.61 3.90

DPS (in EUR) 1.50 1.55 1.60 1.65 1.70

Dividend yield 3.5% 3.0% 2.9% 3.4% 3.5%

EV/Sales 0.6 0.7 0.7 0.6 0.6

EV/EBIT 11.0 10.9 10.7 8.4 7.4



Next event


Change in model

Sales EBIT EPS

2015e 0.0% 0.0% -2.2%

2016e 0.0% 0.0% -2.2%

2017e 0.0% 0.0% -2.2%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


CEWE Stiftung & Co. KGaA There will always be print

We believe the current share price offers an attractive opportunity to buy into this

stock again. We have therefore re-assigned it a BUY rating with an unchanged price

target of € 60.00.

INVESTMENT CASE

The current news about the positive retail sales performance (apart from textile

retail) assures us that the group has met the expectations for 2015. Strategically,

the company is focusing on growing the Online Print business unit and developing

the brands in photofinishing.

• CEWE is pushing the growing market share of value-added products in order

to compensate for the decline in the analogue business and the transition

from paper to digital images. Overall, the new product mix offers an

opportunity to slightly increase margins further.

• The commercial online print business is benefiting from customers trending

towards cheap and very small batches with just-in-time delivery. In our view,

the marketing expenses necessary for the business expansion will still have

affected the segment’s P&L in 2015. It should break even by no later than this

year and its scalability and consequently lower marketing cost ratio should

lead to above-average earnings effects.

CATALYSTS

We assume that the company will publish preliminary figures in mid-February that

will enhance our overall view. Moreover, we expect the company to announce

another dividend increase in March.

VALUATION

Our price target of € 60.00 is still based on our DCF and peer-group models. In

addition, a dividend yield of 3% appears attractive.

28/01/2016

Buy (Hold )

60.00 EUR (60.00 EUR )

Close 25/01/2016 48.51 EUR

Bloomberg: CWC GY WKN: 540390

Sector Consumer




Compared to SDAX

YTD -2.7%

1 month -1.9%

12 months -15.6%

Share data

EV (m EUR; 2016) 327.6



Free float 69.9%



SWOT


• Trend points towards value-added products

• Large product variety in order to exploit pricing potential

• Growth potential in online print


• Highly dependent on the Christmas business

• P&L structure is changing due to value-added products

• Digital imaging also declining currently


• Dr. Rolf Hollander (CEO)

• Dr. Olaf Holzkämper (CFO)

• Harald H. Pirwitz (Member of the Board)

• Frank Zweigle (Member of the Board)

• Dr. Reiner Fageth (Member of the Board)

• Andreas F. L. Heydemann (Member of the Board)

• Thomas Mehls (Member of the Board)

CEWE Stiftung & Co. KGaA is Europe’s leading photofinishing company

offering printing services and related products such as photo books, gift

articles, cameras and accessories. The company markets its products through

both retail stores and e-commerce with more than 30,000 retail partners in

24 European countries. Together with the Cewe Fotowelt division, which

encompasses photo retail and photo services, Cewe-Print.de, Saxoprint und

Viaprinto, Cewe’s online printer, represent the core of the family brand

“Cewe best in print”.


• 2015: Revenues of between € 515 m and € 535 m

• 2015: EBIT of between € 32 m and € 38 m

• 2015: EPS of between € 2.87 and € 3.45

• -



Next event: 23/03/2016 Analyst conference Erbengemeinschaft Neumüller 27.4

Cewe Stiftung & Co. KGaA 2.3

Sparinvest 2.4



5

10

15

20

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

73.7%

13.5%

12.8%

Photofinishing

Retail

Online Printing

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 529.0 544.9 561.2

Consensus 533.0 546.5 561.1

EBIT (in m EUR)

BHL 36.0 38.8 41.8

Consensus 36.0 39.0 42.0

EPS (EUR)

BHL 3.35 3.61 3.90

Consensus 3.36 3.72 3.98

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 6.6% 6.8% 8.7% 7.0% 6.6%


ROCE 15.1% 16.3% 16.6% 16.8% 17.0%


Equity ratio 42.4% 51.1% 51.2% 52.8% 54.4%

Net debt / Equity 14% -14% -15% -20% -26%

Net debt / EBITDA 0.3 -0.4 -0.4 -0.5 -0.7

Interest cover 0.0 0.0 0.0 0.0 0.0



CEWE Stiftung & Co. KGaA – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 536.2 523.8 529.0 544.9 561.2


Total sales 537.6 524.9 529.0 544.9 561.2





EBITDA 66.8 66.1 71.0 74.8 78.8

Depreciation 37.9 33.5 35.0 36.0 37.0

EBITA 28.9 32.6 36.0 38.8 41.8



EBIT 28.9 32.6 36.0 38.8 41.8




EBT 27.2 31.5 34.8 37.6 40.7

Taxes -4.8 -10.1 -11.0 -11.9 -12.9




Net income (adj.) 22.4 21.4 23.8 25.7 27.7

No. of shares 6.6 7.0 7.1 7.1 7.1

EPS 3.40 3.07 3.35 3.61 3.90


2013 2014 2015e 2016e 2017e

Gross margin 64.6% 68.9% 68.9% 68.9% 68.9%

EBITDA margin 12.5% 12.6% 13.4% 13.7% 14.0%

EBITA margin 5.4% 6.2% 6.8% 7.1% 7.5%

EBIT margin 5.4% 6.2% 6.8% 7.1% 7.5%

EBT margin 5.1% 6.0% 6.6% 6.9% 7.2%


Tax rate 17.6% 32.1% 31.6% 31.7% 31.8%



Sales 5.7% -2.3% 1.0% 3.0% 3.0%

EBITDA 1.1% -1.1% 7.4% 5.4% 5.4%

EBIT -0.4% 12.8% 10.3% 7.8% 7.8%

EBT 1.2% 15.7% 10.7% 8.1% 8.0%

Net income (adj.) 18.8% -4.6% 11.5% 7.9% 7.9%

EPS 18.2% -9.9% 9.1% 7.9% 7.9%


Key figures



CEWE Stiftung & Co. KGaA – Balance sheet


Fixed assets 159.7 167.8 178.6 180.6 180.6





Current assets 171.8 171.9 186.0 200.5 218.5

Inventories 59.1 48.9 55.0 57.0 59.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 14.0 27.7 35.0 47.5 63.5

Total assets 331.5 339.6 364.6 381.0 399.0




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 26.1 1.6 5.0 5.0 5.0






CEWE Stiftung & Co. KGaA – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 48.2% 49.4% 49.0% 47.4% 45.3%



Current assets 51.8% 50.6% 51.0% 52.6% 54.7%

Inventories 17.8% 14.4% 15.1% 15.0% 14.8%


Cash 4.2% 8.1% 9.6% 12.5% 15.9%







Short-term debt 7.9% 0.5% 1.4% 1.3% 1.3%





CEWE Stiftung & Co. KGaA – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 22.4 21.4 23.8 25.7 27.7

Depreciation 37.9 33.5 35.0 36.0 37.0



Other 1.1 -2.4 0.0 0.1 0.0


Change in inventory 3.5 10.2 -6.1 -2.0 -2.0

Change in accounts receivable -16.6 4.5 -0.7 0.0 0.0










Free cash-flow 13.6 28.1 12.7 23.8 27.7





Dividend paid -9.0 -10.6 -10.8 -11.4 -11.7










CEWE Stiftung & Co. KGaA – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 3.40 3.07 3.35 3.61 3.90




Valuation ratios

EV/Sales 0.6 0.7 0.7 0.6 0.6

EV/EBITDA 4.8 5.4 5.4 4.4 4.0

EV/EBIT 11.0 10.9 10.7 8.4 7.4



Dividend yield 3.5% 3.0% 2.9% 3.4% 3.5%


EBITDA margin 12.5% 12.6% 13.4% 13.7% 14.0%

EBIT margin 5.4% 6.2% 6.8% 7.1% 7.5%



Productivity ratios


Operating leverage -0.1 -5.5 10.3 2.6 2.6




Financial ratios

Equity ratio 42.4% 51.1% 51.2% 52.8% 54.4%


Net debt / Equity 13.7% -13.5% -14.6% -19.8% -25.7%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 0.29 -0.35 -0.39 -0.53 -0.71


Change Working Capital (in m EUR) 14.2 -9.8 0.9 0.0 0.0

WC /sales 8.7% 7.1% 7.2% 7.0% 6.8%






Others




Pay out ratio 44.1% 50.5% 47.8% 45.7% 43.6%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 3.6 3.3 62.0 90.0 105.0

EBIT 0.8 -1.4 23.3 36.0 42.2

EBIT margin 21.1% -40.7% 37.6% 40.0% 40.2%

Net financial debt -0.9 325.2 416.9 488.7 432.5

Free cash-flow -6.7 19.2 -172.9 -71.8 61.7

EPS (in EUR) 0.03 -0.09 0.55 0.67 0.79

DPS (in EUR) 0.00 0.00 0.00 0.20 0.25

Dividend yield - - 0.0% 2.1% 2.6%

EV/Sales - - 9.9 8.4 6.6

EV/EBIT - - 26.3 20.9 16.5

Price Earnings ratio (P/E) - - 17.9 14.1 12.0


Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


CHORUS Clean Energy AG More solar and wind for the portfolio – initiation of coverage

We initiate our coverage of Chorus with a BUY rating and a price target of € 12.00.

We believe that Chorus will continue to benefit from the currently secured cash

flows. It should also be able to expand the portfolio profitably and extend its asset

management activities.

INVESTMENT CASE

Chorus should also gain from the trend towards increasing the proportion of

renewable sources of energy in the overall electricity supply. Due to this favourable

future outlook, we are confident that Chorus will be able to achieve the following

strategic targets in a shareholder-friendly manner. As a result, encouraging

newsflow should ensure that the share price performs positively:

• Expansion of the power generation business through the acquisition of further

solar and wind parks

• Expansion of asset management activities to include professional investors

• Expansion of facility management activities to include third-party parks

Nevertheless, it should be noted that the achievable yields have recently continued

to decline and we do not expect this trend to reverse. Besides this, we see a

potential conflict of interest when Chorus acquires parks because it is not always

clear to outside shareholders how much of a park is assigned to the company's own

portfolio or to the asset management, all the more so as the company benefits from

asset management fees.

CATALYSTS

The investment of the IPO proceeds worth roughly € 100 m should generate good

newsflow in the next few weeks. In addition, we expect Chorus to be admitted to

one of Deutsche Börse’s selection indices in March.

VALUATION

Our price target of € 12.00 is based on our DCF model and assumes that the

available funds will be invested in the next two years.

28/01/2016

Buy (n.a. )

12.00 EUR (- EUR )

Close 25/01/2016 9.50 EUR

Bloomberg: CU1 GR WKN: A12UL5






YTD 6.5%

1 month 7.4%

12 months -

Share data

EV (m EUR; 2016) 751.9



Free float 86.9%



SWOT


• Payment streams are guaranteed in the long term thanks to fixed feed-in

rates

• Broadly diversified solar and wind park portfolio

• Low risk profile

• Experienced management team

• Sufficient cash available following IPO


• Yields under pressure for acquisition of new projects

• Potential conflict of interest between power generation units and asset

management of new projects


• Holger Götze (CEO)

• Helmut Horst (CFO)

• Heinz Jarothe (COO)

CHORUS Clean Energy AG is not only an independent operator of solar and

wind parks, but a full-service provider for investments in renewable energies.

Chorus currently manage a portfolio of over 70 plants located in five

European countries with a total installed capacity of more than 300

megawatts.


• 2015 only qualitative: Continuation of positive business trend up to Q3 • -



Next event: 31/03/2016 Annual Results Peter Heidecker 13.1

Daniel Crasemann 4.9



0

10

20

30

40

2015 2016PER AVG STD + 1 STD - 1

100.0%

Solar & Wind Parks

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 62.0 90.0 105.0

Consensus 58.6 80.0 99.0

EBIT (in m EUR)

BHL 23.3 36.0 42.2

Consensus 25.0 35.0 45.0

EPS (EUR)

BHL 0.55 0.67 0.79

Consensus 0.44 0.59 0.80

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales - - 355.7% 133.3% 0.0%

Capex/write-downs - - 10.0 4.0 0.0

ROCE 18.1% -0.3% 3.2% 4.6% 5.5%

Free cash flow yield -4.0% 11.3% -88.6% -25.9% 22.3%

Equity ratio 42.9% 24.3% 30.7% 30.7% 33.7%

Net debt / Equity -21% 263% 180% 195% 162%

Net debt / EBITDA -1.1 -252.3 9.2 7.4 5.7

Interest cover > 10 < -10 > 10 > 10 > 10



CHORUS Clean Energy AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 3.6 3.3 62.0 90.0 105.0


Total sales 3.6 3.3 62.0 90.0 105.0

Material expenses 0.0 0.0 0.0 0.0 0.0




EBITDA 0.8 -1.3 45.3 66.0 76.2

Depreciation 0.0 0.1 22.0 30.0 34.0

EBITA 0.8 -1.4 23.3 36.0 42.2



EBIT 0.8 -1.4 23.3 36.0 42.2

Financial result 0.0 0.1 -7.7 -9.4 -10.9

Income on ordinary activities 0.8 -1.2 15.6 26.6 31.3


EBT 0.8 -1.2 15.6 26.6 31.3

Taxes -0.2 -0.4 -4.7 -8.0 -9.4

Net income from cont. operations 0.6 -1.6 10.9 18.6 21.9



Net income (adj.) 0.6 -1.6 10.9 18.6 21.9

No. of shares 17.4 17.4 20.0 27.7 27.7

EPS 0.03 -0.09 0.55 0.67 0.79


2013 2014 2015e 2016e 2017e

Gross margin - - - - -

EBITDA margin 22.4% -38.5% 73.1% 73.3% 72.6%

EBITA margin 21.1% -40.7% 37.6% 40.0% 40.2%

EBIT margin 21.1% -40.7% 37.6% 40.0% 40.2%

EBT margin 21.9% -36.8% 25.2% 29.6% 29.8%

Net profit margin 16.6% -47.7% 17.6% 20.7% 20.9%

Tax rate 24.0% -29.2% 30.0% 30.0% 30.0%



Sales 0,0% -6.3% >100% 45.2% 16.7%

EBITDA 0,0% --- --- 45.7% 15.5%

EBIT 0,0% --- --- 54.5% 17.2%

EBT 0,0% --- --- 70.5% 17.7%

Net income (adj.) 0,0% --- --- 70.5% 17.7%

EPS 0,0% --- --- 23.2% 17.7%


Key figures



CHORUS Clean Energy AG – Balance sheet


Fixed assets 0.3 457.3 655.9 745.9 705.9





Current assets 9.4 52.0 100.3 69.3 86.3

Inventories 0.0 0.0 0.0 0.0 0.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 0.9 37.3 83.1 51.3 67.5

Total assets 9.7 509.3 756.1 815.2 792.1




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 0.0 21.4 25.0 25.0 25.0






CHORUS Clean Energy AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 2.7% 89.8% 86.7% 91.5% 89.1%



Current assets 96.8% 10.2% 13.3% 8.5% 10.9%

Inventories - - 0.0% 0.0% 0.0%


Cash 8.9% 7.3% 11.0% 6.3% 8.5%




Pension provisions - - 0.0% 0.0% 0.0%



Short-term debt 0.0% 4.2% 3.3% 3.1% 3.2%





CHORUS Clean Energy AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 0.6 -1.6 10.9 18.6 21.9

Depreciation 0.0 0.1 22.0 30.0 34.0



Other -4.2 0.4 16.1 -0.1 6.1




Change in accounts payable 5.2 -0.5 0.3 0.5 0.5

Change in other working capital positions -6.4 5.9 -1.6 0.0 0.0

Operating Cash-flow -6.6 4.5 47.6 48.2 61.7

Capex, excluding maintenance 0.0 0.0 -220.5 -120.0 0.0





Cash-flow from investing activities -0.1 14.6 -220.5 -120.0 0.0

Free cash-flow -6.7 19.2 -172.9 -71.8 61.7


Increase/decrease in debt position 0.0 0.0 137.5 40.0 -40.0


Other financing Cash-flow 4.4 1.2 0.3 0.0 0.0

Dividend paid 0.0 0.0 0.0 0.0 -5.5

Cash-flow from financing activities 4.4 1.2 234.8 40.0 -45.5

Increase/ decrease in liquid assets -2.3 20.3 61.9 -31.8 16.2



Change in total cash and cash equivalents -2.3 20.3 61.9 -31.8 16.2





CHORUS Clean Energy AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.03 -0.09 0.55 0.67 0.79


Free Cash-flow per share -0.39 1.10 -8.64 -2.59 2.23


Valuation ratios

EV/Sales - - 9.9 8.4 6.6

EV/EBITDA - - 13.5 11.4 9.1

EV/EBIT - - 26.3 20.9 16.5

Price Earnings ratio (P/E) --- --- 17.9 14.1 12.0

Price to book (total equity) --- --- 0.8 1.1 1.0

Dividend yield --- --- 0.0% 2.1% 2.6%


EBITDA margin 22.4% -38.5% 73.1% 73.3% 72.6%

EBIT margin 21.1% -40.7% 37.6% 40.0% 40.2%

Net return on sales 16.6% -47.7% 17.6% 20.7% 20.9%

Return on capital employed (ROCE) 18.1% -0.3% 3.2% 4.6% 5.5%

Productivity ratios

Capital turnover -83.1% 13,707.0% 1,061.4% 831.5% 674.9%


Sales per employee 119,133 111,633 1,878,788 2,500,000 2,692,308

EBIT per employee 25,100 0 706,061 1,000,000 1,082,051


Financial ratios

Equity ratio 42.9% 24.3% 30.7% 30.7% 33.7%

Net financial debt (in m EUR) -0.9 325.2 416.9 488.7 432.5

Net debt / Equity -20.8% 262.6% 179.9% 195.2% 162.1%

Interest cover > 10 < -10 > 10 > 10 > 10

Net debt / EBITDA -1.08 -252.30 9.20 7.40 5.68

Working Capital (in m EUR) -3.2 1.7 2.2 2.5 2.8

Change Working Capital (in m EUR) -3.2 4.9 0.5 0.3 0.3

WC /sales -90.4% 50.9% 3.5% 2.8% 2.7%






Others

Sales CAGR (last 3 years) - - - 193.1% 215.3%

EBIT CAGR (last 3 years) - - - 262.9% -414.0%

Net income CAGR (last 3 years) - - - 215.1% -339.3%

Pay out ratio 0.0% 0.0% 0.0% 29.8% 31.6%

Free cash-flow (in m EUR) -6.7 19.2 -172.9 -71.8 61.7

Free cash flow yield --- --- -88.6% -27.3% 23.4%




in EUR m 2013 2014 2015e 2016e 2017e

Total income 327.0 338.9 367.1 343.9 380.8

Profit before tax 80.0 82.6 88.1 100.6 98.2

CET1 ratio % 13.3% 13.2% 11.7% 11.5% 11.3%

EPS 0.43 0.47 0.46 0.52 0.51

TNAV per share 3.69 4.02 4.00 4.17 4.38



P/TNAV 2.25 2.07 2.72 2.37 2.26

Dividend yield 4.3% 4.8% 3.2% 3.0% 3.0%


Next event


Change in model

PBT EPS DPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Neil Smith , ACA

Phone: +49 (0)211 4952-478

[email protected]


comdirect bank AG Growth potential: long term intact, but near term vulnerable

FY 2015 trading volumes grew ~30% yoy, driven by market volatility. But after such

a strong year we now expect FY 2016 revenues to decline again, driven by (a)

persistently low interest rates, and (b) lower trading volumes as declining equity

markets give rise to greater customer risk aversion. So although the positive long

term trends remain intact (migration to on-line banking), we nevertheless adopt a

more cautious view on a 12-month horizon.

INVESTMENT CASE

• FY 2016 PBT should be supported by a € 37 m disposal gain (Visa Europe)

• Long term, revenue growth should be supported by migration to online banking

BUT

• We expect FY 2016 commission to decline due to growing customer risk aversion

• We expect FY 2016 net interest income to decline due to low interest rates

• The treasury portfolio risk is higher than the RWAs suggest (~€ 10 bn CBK debt)

• The share price (12m: +33% vs. sector) may now be vulnerable to correction

CATALYSTS

We expect a slowdown in trading volumes to become evident towards the end of Q1

2016 (Q1 2016 results are reported on 27 April).

VALUATION

• Assuming the P/E (18.4x) reverts to the LTA (18.0x) suggests € 9.40 (-3%)

• Assuming the P/TB (2.21x) reverts to the LTA (2.19x) suggests € 9.55 (-1%)

• The ROTE (12.0%) suggests a P/TB of 1.02x and € 4.44 (-54%) (regression)

Our PT of € 10.00 (+4%) is derived from an estimate of the Intrinsic Value (see ARL

note of 24/11/15 for valuation methodology). It suggests a P/TB of 2.23x (+2YR,

based on FactSet consensus) and a sector premium of 225%, compared with a LTA

P/TB of 2.19x and sector premium of 110%. We believe that this is sufficient to

reflect the potential for long term growth and ownership change.

28/01/2016

Hold (Hold )

10.00 EUR (10.00 EUR )

Close 25/01/2016 9.90 EUR

Bloomberg: COM GR WKN: 542800

Sector Banks




Compared to SDAX

YTD -0.7%

1 month -1.1%

12 months 7.2%

Share data

Market Cap (m EUR) 1,398


Free float 18.7%



SWOT


• Above-average CET1 ratio

• Above-average revenue growth

• Below-average litigation risk

• Flexible cost base


• Increasing levels of competition

• Below-average leverage ratio

• Dependence on CBK for certain services


• Arno Walter (CEO)

• Holger Hohrein (CFO)

• Martina Palte (COO)

comdirect comprises two divisions. The B2C division (comdirect) provides

online banking services to private customers in Germany. Products and

services include securities trading, current and savings accounts, and lending

(consumer and home finance). The B2B division (ebase) offers online banking

services to institutional clients (e.g. insurance companies, asset managers,

IFAs) in Germany.


• - • -



Next event: 27/01/2016 Quarterly Results Commerzbank 81.1

Shareholder Value 0.8

ACATIS 0.7



5

15

25

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

85.0%

15.0%

B2C

eBase

Company Overview

2015e 2016e 2017e

PBT (m)

BHL 88.1 100.6 98.2

Consensus 91.8 117.2 98.2

DPS (EUR)

BHL 0.35 0.30 0.30

Consensus 0.40 0.40 0.41

EPS (EUR)

BHL 0.46 0.52 0.51

Consensus 0.47 0.52 0.51

in EUR m 2013 2014 2015e 2016e 2017e

Total income 327.0 338.9 367.1 343.9 380.8


CET1 ratio % 13.3% 13.2% 11.7% 11.5% 11.3%

EPS 0.43 0.47 0.46 0.52 0.51

TNAV per share 3.69 4.02 4.00 4.17 4.38



P/TNAV 2.25 2.07 2.72 2.37 2.26

Dividend yield 4.3% 4.8% 3.2% 3.0% 3.0%



comdirect bank AG – Income statement

EUR m 2013 2014 2015e 2016e 2017e

Total income 327.0 338.9 367.1 343.9 380.8

Loan loss provisions -1.4 -0.3 -2.6 -1.1 -1.6

Costs -259.9 -270.9 -284.4 -287.2 -290.1

Other income / expense 14.4 14.8 8.0 45.0 9.0


Taxes -19.5 -16.3 -23.8 -27.2 -26.5

Profit after tax 60.5 66.3 64.3 73.4 71.6

NCI & other (PL) 0.0 0.0 0.0 0.0 0.0

Earnings 60.5 66.3 64.3 73.4 71.6

Dividend paid -62.1 -50.8 -56.5 -49.4 -42.4

Retained earnings -1.6 15.5 7.8 24.0 29.3


.

comdirect bank AG – Balance sheet

EUR m 2013 2014 2015e 2016e 2017e

Customer loans 189.9 235.4 256.5 282.2 310.4


Other assets 13,943 14,910 16,256 16,891 17,378

Total assets 14,163 15,170 16,535 17,196 17,712

Customer deposits 13,488 14,455 15,901 16,537 17,033


NCI & other (BS) 0.0 0.0 0.0 0.0 0.0


Total liabilities 14,163 15,170 16,535 17,196 17,712


comdirect bank AG – Balance sheet structure

2013 2014 2015e 2016e 2017e

Customer loans 189.9 235.4 256.5 282.2 310.4


Other assets 13,943 14,910 16,256 16,891 17,378

Total assets 14,163 15,170 16,535 17,196 17,712

Customer deposits 13,488 14,455 15,901 16,537 17,033


NCI & other (BS) 0.0 0.0 0.0 0.0 0.0




Key figures



comdirect bank AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

No. of shares (m) 141.2 141.2 141.2 141.2 141.2

Number of Shares (Average) (m) 141.2 141.2 141.2 141.2 141.2

EPS 0.43 0.47 0.46 0.52 0.51

TNAV per share 3.69 4.02 4.00 4.17 4.38


Profit & loss data

CIR 79.5% 79.9% 77.5% 83.5% 76.2%

Tax ratio 24.4% 19.8% 27.0% 27.0% 27.0%

PBT growth - 3.2% 6.7% 14.1% -2.4%

EPS growth - 9.5% -3.0% 14.1% -2.4%

ROTE - 12.2% 11.4% 12.7% 11.9%

Balance sheet data

RWA (m) 3,486 3,492 4,051 4,299 4,605

CET1 ratio % 13.3% 13.2% 11.7% 11.5% 11.3%

Tier 1 ratio % 13.3% 13.2% 11.7% 11.5% 11.3%

Leverage ratio % 3.3% 3.0% 2.9% 2.9% 2.9%

LCR % - - - - -

NSFR % - - - - -

Valuation ratios


P/TNAV 2.2 2.1 2.7 2.4 2.3

Dividend yield 4.3% 4.8% 3.2% 3.0% 3.0%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 33.5 38.2 42.4 46.6 51.3

EBIT 1.8 3.0 3.5 4.7 5.8

EBIT margin 5.5% 7.9% 8.1% 10.0% 11.2%


Free cash-flow 2.2 1.1 0.3 2.0 1.6

EPS (in EUR) 0.31 0.52 0.60 0.82 1.01

DPS (in EUR) 0.10 0.15 0.15 0.20 0.25

Dividend yield 1.3% 1.7% 1.5% 2.1% 2.6%

EV/Sales 0.8 0.8 0.8 0.7 0.6

EV/EBIT 14.4 9.7 9.9 6.7 5.3



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


DATRON AG Prospects for 2016 are good

Following our latest discussions with the management team, we still believe that

the company has good growth prospects. We are therefore reiterating our BUY

rating with an unaltered price target of € 12.50.

INVESTMENT CASE

We assume that Datron’s position in niche markets and a worldwide installed base

of more than 3,400 machines in the next few years will allow it to achieve a

double-digit EBIT margin. When examining the margin for 2015 (BHLe EBIT: 8.1%),

it should be borne in mind that the company has made further significant

investments in its workforce of late and also plans to in future. We regard these

investments and ramp-up costs for the growth to be expected in future. In addition,

when analysing the figures, it should be borne in mind that the company prepares

its financial statements in accordance with the German Civil Code (HGB). For

example, in 2014 Datron booked around € 3.6 m as R&D expenses, which was

therefore about 10% of revenue. We assume that these expenses have risen to

€ 4.0 m in 2015, which corresponds to a ratio of 9.4%. On balance, we expect to see

organic revenue growth of 10% in the next few years. This growth could also be

supported by acquisitions. In our view, the production capacities could generate

revenue of well in excess of € 50 m, which suggests that there will be no step-fixed

costs from investment.

CATALYSTS

Since the company achieved record-breaking order intake levels in Q3, we expect

the company to publish favourable newsflow about 2015 at the end of February.

The outlook for 2016 should also clearly show that Datron has significantly

outperformed the global engineering sector.

VALUATION

Our peer group is trading at a 2016E PER of 15.7x (Datron: 11.7x), which implies

further upside. Our new price target of € 12.50 is also confirmed by our DCF model.

28/01/2016

Buy (Buy )

12.50 EUR (12.50 EUR )

Close 25/01/2016 9.55 EUR

Bloomberg: DAR GY WKN: A0V9LA

Sector Engineering




Compared to SDAX

YTD 5.0%

1 month 0.1%

12 months -3.8%

Share data

EV (m EUR; 2016) 31.4



Free float 27.5%



SWOT


• High-tech products for fast-growing markets

• Considerable barriers prevent rivals from entering Datron’s market

• Highly innovative

• Large volume of machines installed worldwide (>3,400)

• Using synergy potential for internationalisation


• As SME, reliant upon highly skilled staff

• As engineering company, Datron depends on industry investment activity

• Corporate structure has to be adjusted constantly to meet growth

requirements


• Dr. rer. pol. Arne Brüsch (CEO)

• Michael Daniel (CFO)

• Thorsten Müller

Datron is an engineering SME that develops, produces and markets various

CNC milling machines worldwide, particularly for the processing of light-

weight materials. In 2009 and 2010, Datron established a new business unit

that focused on CNC milling machines for dental applications. Besides this,

The company develops, manufactures and markets dispensing machines for

industrial adhesive, sealant and EMC applications globally. These almost

mass produced machines offer individually customisable solutions for the

widest possible range of industrial applications.


• 2015: Revenue at least € 42 m

• 2015: EBIT margin of 8%

• 2016: 10% revenue growth



Next event: 22/02/2016 Preliminary Results Dr. Arne Brüsch (CEO) 64.6

restl. Management 2.0

Manfred Becker 4.9



0

10

20

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

54.4%

18.8%

14.3%

8.7%3.8% CNC Milling Machines

CNC/Dental Milling Tools

After Sales Service & Other

Dental-CAM Milling/Grinding Machines

Dosing Systems

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 42.4 46.6 51.3

Consensus 43.6 47.9 52.5

EBIT (in m EUR)

BHL 3.5 4.7 5.8


EPS (EUR)

BHL 0.60 0.82 1.01

Consensus 0.60 0.82 1.01

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 1.2% 0.5% 3.3% 1.5% 3.1%


ROCE 9.8% 14.8% 15.6% 18.8% 20.5%


Equity ratio 82.9% 82.1% 83.0% 83.9% 85.1%

Net debt / Equity -28% -28% -24% -27% -27%

Net debt / EBITDA -2.1 -1.5 -1.3 -1.3 -1.2

Interest cover 0.0 0.0 0.0 0.0 0.0



DATRON AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 33.5 38.2 42.4 46.6 51.3

Own work capitalised -0.3 1.3 1.3 1.3 1.3

Total sales 33.2 39.5 43.6 47.9 52.5





EBITDA 2.4 3.7 4.1 5.4 6.5

Depreciation 0.6 0.7 0.7 0.7 0.7

EBITA 1.8 3.0 3.5 4.7 5.8



EBIT 1.8 3.0 3.5 4.7 5.8

Financial result 0.0 0.0 0.0 0.0 0.0



EBT 1.8 3.0 3.5 4.7 5.8

Taxes -0.6 -0.9 -1.0 -1.4 -1.7




Net income (adj.) 1.3 2.1 2.4 3.3 4.0

No. of shares 4.0 4.0 4.0 4.0 4.0

EPS 0.31 0.52 0.60 0.82 1.01


2013 2014 2015e 2016e 2017e

Gross margin 58.5% 54.6% 56.0% 57.0% 57.0%

EBITDA margin 7.2% 9.7% 9.8% 11.5% 12.6%

EBITA margin 5.5% 7.9% 8.1% 10.0% 11.2%

EBIT margin 5.5% 7.9% 8.1% 10.0% 11.2%

EBT margin 5.4% 7.9% 8.1% 10.0% 11.2%


Tax rate 30.5% 30.1% 30.0% 30.0% 30.0%



Sales 2.0% 13.9% 10.9% 10.0% 10.0%

EBITDA -6.6% 52.0% 12.1% 29.5% 20.4%

EBIT -11.6% 63.4% 14.8% 35.3% 23.5%

EBT -19.5% 66.1% 14.9% 35.3% 23.5%

Net income (adj.) -21.5% 67.0% 15.2% 35.3% 23.5%

EPS -21.5% 67.0% 15.2% 35.3% 23.5%


Key figures



DATRON AG – Balance sheet


Fixed assets 4.5 4.0 4.7 4.7 5.6





Current assets 18.1 20.8 21.9 24.9 27.4

Inventories 6.8 8.6 9.5 10.5 11.5



Securities 0.0 0.0 0.0 0.0 0.0

Cash 5.2 5.7 5.4 6.8 7.6

Total assets 22.7 24.8 26.7 29.6 33.0




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 0.0 0.0 0.0 0.0 0.0






DATRON AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 20.0% 16.2% 17.7% 16.0% 17.0%



Current assets 79.8% 83.7% 82.2% 84.0% 82.9%

Inventories 29.8% 34.6% 35.7% 35.4% 34.9%


Cash 22.8% 23.1% 20.2% 23.0% 23.0%







Short-term debt 0.0% 0.0% 0.0% 0.0% 0.0%





DATRON AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 1.3 2.1 2.4 3.3 4.0

Depreciation 0.6 0.7 0.7 0.7 0.7



Other -0.4 0.1 -0.1 0.1 0.0



Change in accounts receivable 0.2 -0.3 -0.6 -0.6 -0.6










Free cash-flow 2.2 1.1 0.3 2.0 1.6



Purchase of own shares 0.0 -0.2 0.0 0.0 0.0


Dividend paid -0.4 -0.4 -0.6 -0.6 -0.8


Increase/ decrease in liquid assets 1.8 0.5 -0.3 1.4 0.8



Change in total cash and cash equivalents 1.8 0.1 -0.3 1.4 0.8





DATRON AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.31 0.52 0.60 0.82 1.01




Valuation ratios

EV/Sales 0.8 0.8 0.8 0.7 0.6

EV/EBITDA 10.9 7.9 8.3 5.9 4.7

EV/EBIT 14.4 9.7 9.9 6.7 5.3



Dividend yield 1.3% 1.7% 1.5% 2.1% 2.6%


EBITDA margin 7.2% 9.7% 9.8% 11.5% 12.6%

EBIT margin 5.5% 7.9% 8.1% 10.0% 11.2%



Productivity ratios


Operating leverage -5.7 4.6 1.4 3.5 2.3




Financial ratios

Equity ratio 82.9% 82.1% 83.0% 83.9% 85.1%


Net debt / Equity -27.5% -28.1% -24.4% -27.4% -27.1%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA -2.13 -1.55 -1.30 -1.27 -1.18



WC /sales 29.6% 32.0% 32.0% 32.0% 32.0%






Others


EBIT CAGR (last 3 years) -0.9% 0.0% 18.4% 36.4% 24.3%

Net income CAGR (last 3 years) -2.8% -3.0% 14.8% 37.6% 24.4%

Pay out ratio 31.9% 28.6% 24.8% 24.5% 24.8%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 505.5 501.7 530.0 548.6 567.7

EBIT 17.8 7.1 6.8 12.7 21.9

EBIT margin 3.5% 1.4% 1.3% 2.3% 3.9%

Net financial debt 21.4 -10.2 2.0 -5.4 2.2

Free cash-flow -35.2 35.0 -8.3 10.3 -4.0

EPS (in EUR) 0.97 0.24 0.35 0.69 1.23

DPS (in EUR) 0.50 0.25 0.25 0.30 0.60

Dividend yield 1.6% 1.3% 1.2% 1.6% 3.3%

EV/Sales 0.8 0.4 0.5 0.4 0.4

EV/EBIT 18.1 14.0 16.3 11.7 8.1



Next event

- -

Change in model

Sales EBIT EPS

2015e -1.3% -20.0% -21.8%

2016e -1.3% -23.4% -24.3%

2017e -1.3% -8.0% -8.1%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Delticom AG Flat tyres

Delticom is active in a mature market in two ways: 1) the company sells

replacement tyres to consumers, and 2) this market is saturated in Europe.

Following the release of the latest market statistics, we have revised our estimates

and we downgrade this stock from Hold to SELL.

INVESTMENT CASE

As a European market leader in online shopping for tyres, the company sets itself

apart from the competition through a very broad product range and good service.

The trend from offline to online gives Delticom structural support.

• Online shopping is becoming ever more commonplace

• The penetration rate of the online sales channel is increasing steadily

• In addition, Delticom is pressing ahead with its international expansion

Nonetheless, the competitive environment remains difficult, because the European

tyre market is not growing structurally, the entry barriers for online tyre retail are

low and the key advantage of an e-commerce business model – the elimination of

bricks-and-mortar retail – is only partially effective as the customer almost always

requires a garage for a tyre change. High logistics costs could also mean that

greater unit sales do not always lead to higher earnings.

CATALYSTS

Looking at the weather conditions in Europe during Q4 2015 (no bad winter

weather) leads us to believe that the company’s earnings will tend to fall short of

the consensus estimates. Moreover, early 2016 is unlikely to have brought

corresponding catch-up effects.

VALUATION

Even though Delticom’s valuation appears cheap with an EV/sales multiple of 0.4x,

given the environment and the structural challenges we do not consider it necessary

to take up a positive position.

28/01/2016

Sell (Hold )

16.00 EUR (22.00 EUR )

Close 25/01/2016 18.20 EUR

Bloomberg: DEX GY WKN: 514680

Sector Retail





YTD -3.5%

1 month -4.4%

12 months 12.8%

Share data

EV (m EUR; 2016) 211.4



Free float 49.9%



SWOT


• Biggest tyre retailer in Europe with corresponding purchasing power

• In-house warehousing capacity

• Multi-brand strategy, e.g. Tirendo and reifendirekt


• Low market entry barriers

• Prices in market coming under major structural pressure

• Winter tyre business is very weather dependent

• Weather-related shifts between quarters and base effects vs. previous

year are unavoidable


• Andreas Prüfer (Co-CEO, CFO)

• Philip von Grolman (Co-CEO)

• Susan Dörsel-Müller (Großhandel,Operation-Center, B2B)

• Thierry Delesalle (B2C, Marketing)

Delticom AG is Europe’s leading online tyre retailer with roughly 200 online

shops in 41 countries. The company sells tyres and wheels for cars, light

trucks and trucks, buses, motorcycles and bicycles, and special tyres to

private and business customers. It also offers selected car parts and

accessories such as motor oil and batteries.


• 2015: Revenue between € 530 m and € 540 m

• 2015: EBITDA at least on a par with a year ago

• 2015: More than 1 million new customers

• -



Next event: - - Andreas Prüfer 25.0

Rainer Binder 25.0

Acatis 9.8



10

15

20

25

30

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

100,0%

Tires & other Products

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 530.0 548.6 567.7

Consensus 539.0 566.8 600.8

EBIT (in m EUR)

BHL 6.8 12.7 21.9

Consensus 8.1 18.1 21.3

EPS (EUR)

BHL 0.35 0.69 1.23

Consensus 0.41 0.92 1.34

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 0.3% 0.3% 0.6% 0.6% 0.6%


ROCE 21.1% 10.2% 9.0% 16.8% 26.8%

Free cash flow yield -9.3% 15.6% -3.3% 4.3% -1.7%

Equity ratio 29.2% 30.7% 29.7% 32.1% 41.5%

Net debt / Equity 41% -20% 4% -9% 3%

Net debt / EBITDA 1.0 -0.7 0.1 -0.3 0.1

Interest cover 0.0 > 10 > 10 0.0 0.0



Delticom AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 505.5 501.7 530.0 548.6 567.7


Total sales 505.5 501.7 530.0 548.6 567.7





EBITDA 22.2 15.4 15.3 18.1 27.1

Depreciation 4.3 8.3 8.5 5.4 5.2

EBITA 17.8 7.1 6.8 12.7 21.9



EBIT 17.8 7.1 6.8 12.7 21.9




EBT 17.7 6.3 6.1 12.1 21.4

Taxes -6.2 -3.4 -2.0 -3.9 -6.9




Net income (adj.) 11.6 2.9 4.2 8.2 14.6

No. of shares 11.9 11.9 11.9 11.9 11.9

EPS 0.97 0.24 0.35 0.69 1.23


2013 2014 2015e 2016e 2017e

Gross margin 24.8% 24.5% 25.0% 25.0% 26.0%

EBITDA margin 4.4% 3.1% 2.9% 3.3% 4.8%

EBITA margin 3.5% 1.4% 1.3% 2.3% 3.9%

EBIT margin 3.5% 1.4% 1.3% 2.3% 3.9%

EBT margin 3.5% 1.3% 1.2% 2.2% 3.8%


Tax rate 34.8% 53.7% 32.0% 32.0% 32.0%



Sales 10.8% -0.8% 5.6% 3.5% 3.5%

EBITDA -37.2% -30.7% -0.5% 18.5% 49.5%

EBIT -45.3% -60.1% -4.4% 87.3% 72.0%

EBT -45.7% -64.2% -3.4% 97.6% 76.9%

Net income (adj.) -48.0% -75.0% 44.2% 97.6% 76.9%

EPS -48.0% -75.0% 44.2% 97.6% 76.9%


Key figures



Delticom AG – Balance sheet


Fixed assets 66.7 58.1 52.9 50.8 49.1





Current assets 110.3 105.9 120.5 126.3 114.2

Inventories 72.8 56.2 79.9 82.7 77.8



Securities 0.0 0.0 0.0 0.0 0.0

Cash 11.3 30.0 22.0 24.4 11.8

Total assets 177.0 164.0 173.4 177.1 163.3




Minorities 0.0 1.0 1.0 1.0 1.0







Short-term debt 21.7 4.4 4.0 4.0 4.0






Delticom AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 37.7% 35.4% 30.5% 28.7% 30.1%



Current assets 62.3% 64.6% 69.5% 71.3% 69.9%

Inventories 41.2% 34.2% 46.1% 46.7% 47.6%


Cash 6.4% 18.3% 12.7% 13.8% 7.2%







Short-term debt 12.2% 2.7% 2.3% 2.3% 2.4%





Delticom AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 11.6 2.9 4.2 8.2 14.6

Depreciation 4.3 8.3 8.5 5.4 5.2



Other -2.5 0.4 0.0 0.0 -0.1


Change in inventory 1.3 16.7 -23.7 -2.8 4.9

Change in accounts receivable -4.0 -3.2 1.4 -0.5 -5.1

Change in accounts payable -2.9 1.2 3.9 2.8 -20.4


Operating Cash-flow 8.1 36.7 -5.0 13.6 -0.6


Payments for acquisitions -42.3 0.0 0.0 0.0 0.0





Free cash-flow -35.2 35.0 -8.3 10.3 -4.0


Increase/decrease in debt position 22.9 -12.9 4.2 -5.0 -5.0


Other financing Cash-flow 0.0 0.7 -0.9 0.0 0.0

Dividend paid -22.5 -5.9 -3.0 -3.0 -3.6

Cash-flow from financing activities 0.5 -16.9 0.3 -8.0 -8.6

Increase/ decrease in liquid assets -34.7 18.1 -7.9 2.3 -12.6



Change in total cash and cash equivalents -34.8 18.7 -7.9 2.3 -12.6





Delticom AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.97 0.24 0.35 0.69 1.23


Free Cash-flow per share -2.97 2.95 -0.70 0.87 -0.34


Valuation ratios

EV/Sales 0.8 0.4 0.5 0.4 0.4

EV/EBITDA 18.1 14.0 16.3 11.7 8.1

EV/EBIT 22.5 30.2 36.7 16.6 10.0



Dividend yield 1.6% 1.3% 1.2% 1.6% 3.3%


EBITDA margin 4.4% 3.1% 2.9% 3.3% 4.8%

EBIT margin 3.5% 1.4% 1.3% 2.3% 3.9%



Productivity ratios


Operating leverage -0.3 2.8 0.0 0.3 0.5

Sales per employee 2,824,257 2,031,178 3,312,500 3,428,438 3,548,433



Financial ratios

Equity ratio 29.2% 30.7% 29.7% 32.1% 41.5%

Net financial debt (in m EUR) 21.4 -10.2 2.0 -5.4 2.2

Net debt / Equity 41.4% -20.2% 3.8% -9.4% 3.3%

Interest cover 0.0 > 10 > 10 0.0 0.0

Net debt / EBITDA 0.96 -0.66 0.13 -0.30 0.08

Working Capital (in m EUR) 9.4 -5.3 13.1 13.5 34.2

Change Working Capital (in m EUR) 0.5 -14.7 18.3 0.5 20.7

WC /sales 1.9% -1.1% 2.5% 2.5% 6.0%






Others


EBIT CAGR (last 3 years) -27.9% -48.5% -40.7% -10.6% 45.5%


Pay out ratio 51.3% 102.5% 71.1% 43.2% 48.8%

Free cash-flow (in m EUR) -35.2 35.0 -8.3 10.3 -4.0

Free cash flow yield -9.3% 15.6% -3.3% 4.8% -1.9%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,453 1,530 1,231 1,265 1,355

EBIT 48 13 0 6 19

EBIT margin 3.3% 0.8% 0.0% 0.5% 1.4%

Net financial debt 32 -14 -27 -50 -96

Free cash-flow 20 58 22 32 52

EPS (in EUR) 0.30 0.18 -0.02 0.01 0.10

DPS (in EUR) 0.07 0.07 0.07 0.07 0.07

Dividend yield 1.1% 1.8% 1.9% 2.3% 2.3%

EV/Sales 0.7 0.5 0.5 0.4 0.4

EV/EBIT 21.5 54.4 -4,887.4 88.2 26.3

Price Earnings ratio (P/E) 21.8 22.8 -163.4 270.1 30.0


Next event

RPC 17/03/2016

Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Gordon Schönell , CIIA, CEFA

Phone: +49 (0)211 4952-455

[email protected]


Deutz AG End markets still weak, but interesting nonetheless

Looking at the sales markets by region and by application there is currently not

much positive news about Deutz. As there is no sign of an improvement in the sales

markets, we are still in a waiting position. However, the cyclical nature of both the

end markets and the stock means that a turnaround could happen quickly.

INVESTMENT CASE

A weak economy in almost all of the end markets and pre-buying effects associated

with the new engine generation are likely to have led to a revenue decline of about

20% in 2015. We do not see any Deutz-specific issues. It appears that Deutz is

rather gaining market share with the new engines.

At the moment, there is also no indication of a turnaround in the sales markets. We

merely see a stabilisation at a low level. With the pre-buying effects petering out,

we expect Deutz to slightly outperform the market in 2016 (BHLe: sideways).

Because the engines just launched onto the market already meet the 2019 emission

standards, R&D investment is set to decline significantly. This should enable Deutz

to generate a solid free cash flow.

CATALYSTS

• Deutz’s end markets are very cyclical, and so is the share. Positive newsflow, e.g.

from manufacturers of agricultural machinery, should be well received by the

market.

• Deutz owns a large plot of land in a good location in Cologne. We estimate that

selling this land (planned for 2017) could rake in an amount in the mid-double-

digit millions.

VALUATION

Deutz stock is currently trading at a P/B ratio of merely 0.8x. In view of an EBITDA

margin of around 8%, however, we expect the FCF yield to remain above 10% in

future, after 12% in 2014.

28/01/2016

Hold (Hold )

3.50 EUR (3.50 EUR )

Close 25/01/2016 2.99 EUR

Bloomberg: DEZ GY WKN: 630500

Sector Engineering




Compared to SDAX

YTD -10.5%

1 month -11.4%

12 months -39.2%

Share data

EV (m EUR; 2016) 548



Free float 75.0%



SWOT


• Strong brand in Europe.

• Investments to meet new emission standards completed => high FCF

potential

• Successful acquisition of new customers

• Strong balance sheet


• Repeatedly fallen short of market expectations

• Very volatile business

• Biggest customer (Volvo) is also major shareholder

• Margins always low compared with the capital goods sector


• Dr Helmut Leube (CEO)

• Dr Magarete Haase (CFO)

• Michael Wellenzohn (CSO)

Deutz AG is one of the largest independent manufacturers of diesel engines

in the power range up to 500 kW. The company’s engines are mainly used in

commercial vehicles, agricultural machinery, stationary machines

(emergency power supply), and mobile machinery (construction, logistics).

Deutz was founded in 1864 and is headquartered in Cologne, Germany.


• 2015 revenue: -10%, EBIT breakeven

• 2016 revenues: first indication of marginal growth



Next event: 17/03/2016 RPC Volvo 25.0

Old Mutual 3.1

Norges Bank 3.0



0

10

20

30

40

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

83.7%

16.3%

Compact Engines

Customised Solutions

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,231 1,265 1,355

Consensus 1,226 1,263 1,360

EBIT (in m EUR)

BHL 0 6 19

Consensus 0 20 44

EPS (EUR)

BHL -0.02 0.01 0.10

Consensus -0.03 0.09 0.25

2013 2014 2015e 2016e 2017e

R&D/Sales 4.0% 4.9% 6.3% 5.8% 5.5%

Capex/Sales 5.9% 4.0% 4.7% 4.9% 3.5%


ROCE 6.1% 1.6% 0.0% 0.8% 2.5%


Equity ratio 45.0% 44.5% 45.4% 45.7% 45.4%

Net debt / Equity 6% -3% -5% -10% -20%

Net debt / EBITDA 0.2 -0.1 -0.3 -0.5 -0.8

Interest cover 0.0 > 10 0.0 > 10 > 10



Deutz AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,453 1,530 1,231 1,265 1,355

Cost of Sales -1,257 -1,328 -1,046 -1,068 -1,138

Gross profit 196 203 185 197 217

Sales and marketing -63 -66 -70 -70 -75

General and administration -34 -34 -37 -38 -41

Research and development -59 -74 -78 -74 -74

Other operating result 7 -16 0 -9 -8

EBITDA 142 120 96 102 114


EBITA 95 69 47 53 64



EBIT 48 13 0 6 19


Income on ordinary activities 42 7 -5 2 15


EBT 42 7 -5 2 15

Taxes -6 13 1 0 -2

Net income from cont. operations 36 20 -4 1 12



Net income (adj.) 36 21 -3 1 12

No. of shares 121 121 121 121 121

EPS (in EUR) 0.30 0.18 -0.02 0.01 0.10


2013 2014 2015e 2016e 2017e

Gross margin 13.5% 13.2% 15.0% 15.6% 16.0%

EBITDA margin 9.8% 7.9% 7.8% 8.1% 8.4%

EBITA margin 6.5% 4.5% 3.8% 4.2% 4.7%

EBIT margin 3.3% 0.8% 0.0% 0.5% 1.4%

EBT margin 2.9% 0.4% -0.4% 0.1% 1.1%

Net profit margin 2.5% 1.3% -0.3% 0.1% 0.9%

Tax rate 13.3% -191.0% 17.0% 17.0% 17.0%



Sales 12.5% 5.3% -19.5% 2.8% 7.1%

EBITDA 16.7% -15.3% -20.1% 6.6% 11.0%

EBIT 28.0% -73.1% --- --- >100%

EBT 56.6% -83.9% --- --- >100%

Net income (adj.) 71.4% -41.1% --- --- >100%

EPS 71.4% -41.1% --- --- >100%


Key figures



Deutz AG – Balance sheet


Fixed assets 627 626 575 543 499





Current assets 494 523 503 514 571

Inventories 225 245 240 240 250




Cash 59 102 104 118 154

Total assets 1,121 1,149 1,079 1,056 1,070

















Deutz AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 56.0% 54.5% 53.3% 51.4% 46.7%



Current assets 44.0% 45.5% 46.7% 48.6% 53.3%

Inventories 20.0% 21.3% 22.3% 22.7% 23.4%


Cash 5.3% 8.8% 9.7% 11.1% 14.4%







Short-term debt 0.7% 1.3% 1.1% 1.2% 1.2%





Deutz AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 36 21 -3 1 12



Change of provisions 6 18 -25 3 4

Other 1 -16 12 -1 -4


Change in inventory -43 -14 5 0 -10

Change in accounts receivable -34 31 7 4 -8

Change in accounts payable 49 -33 -21 -8 10

Change in other working capital positions -4 -1 8 -1 0



Payments for acquisitions 0 0 0 0 0







Increase/decrease in debt position -10 -3 -10 -11 -9


Other financing Cash-flow -7 -6 -1 0 2

Dividend paid 0 -9 -8 -8 -8

Cash-flow from financing activities -13 -18 -19 -19 -16

Increase/ decrease in liquid assets 7 41 3 13 36



Change in total cash and cash equivalents 7 43 3 13 36





Deutz AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.30 0.18 -0.02 0.01 0.10




Valuation ratios

EV/Sales 0.7 0.5 0.5 0.4 0.4

EV/EBITDA 7.2 5.8 6.8 5.4 4.4

EV/EBIT 21.5 54.4 -4,887.4 88.2 26.3



Dividend yield 1.1% 1.8% 1.9% 2.3% 2.3%


EBITDA margin 9.8% 7.9% 7.8% 8.1% 8.4%

EBIT margin 3.3% 0.8% 0.0% 0.5% 1.4%

Net return on sales 2.5% 1.4% -0.2% 0.1% 0.9%


Productivity ratios



Sales per employee 367,713 390,756 0 0 0

EBIT per employee 12,019 3,269 0 0 0


Financial ratios

Equity ratio 45.0% 44.5% 45.4% 45.7% 45.4%

Net financial debt (in m EUR) 32 -14 -27 -50 -96

Net debt / Equity 6.3% -2.7% -5.4% -10.5% -19.7%

Interest cover 0.0 > 10 0.0 > 10 > 10

Net debt / EBITDA 0.22 -0.11 -0.28 -0.49 -0.84


Change Working Capital (in m EUR) 31 24 9 4 8

WC /sales 11.9% 12.8% 16.7% 16.5% 16.0%






Others

Sales CAGR (last 3 years) 6.9% 0.0% -1.6% -4.5% -4.0%



Pay out ratio 23.5% 39.9% -310.0% 632.4% 70.1%

Free cash-flow (in m EUR) 20 58 22 32 52





in m EUR 2013 2014 2015e 2016e 2017e

Sales 125.2 147.5 134.9 110.4 111.5

FFO 45.9 47.9 48.3 43.5 47.4

FFO margin 36.7% 32.5% 35.8% 39.4% 42.5%

Net financial debt 1,667 1,569 1,337 939.7 974.4

Net asset value per share 12.58 12.61 13.05 13.19 13.46

FFOPS (in EUR) 0.94 0.70 0.70 0.63 0.69

DPS (in EUR) 0.35 0.35 0.35 0.35 0.35

Dividend yield 5.2% 4.7% 3.8% 4.0% 4.0%

EV/EBITDA 20.3 17.1 15.2 12.2 17.0

P/NAV 0.5 0.6 0.7 0.7 0.6

P/FFO 7.1 10.6 13.2 13.7 12.6


Next event


Change in model

Sales FFO EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Dr. Georg Kanders , Analyst

Phone: +49 (0)211 4952-718

[email protected]


DIC Asset AG Better position

DIC Asset is the only large real estate company trading at a substantial discount to

its NAV. The debt was markedly reduced and the inclusion of real estate assets

worth € 270 m in a new fund is likely to bring the LTV to well below 60%. This puts

DIC Asset in a much better position on both sides of the sector consolidation

process.

INVESTMENT CASE

DIC Asset is a commercial real estate company with a property portfolio worth more

than € 2 bn. The firm’s second mainstay (i.e. the fund business for institutional

investors) permits more efficient usage of the virtually nationwide platform.

DIC Asset is likely to bring the LTV substantially below the target of 60% with the

inclusion of real estate assets worth € 270 m in a new fund. This will grant the new

CEO more financially freedom to put the company on a new course strategically.

CATALYSTS

The 2015 results should already show a major improvement in the level of debt. The

€ 270 m fund transaction (property transfer in Q1) will probably bring the LTV

below 60% and therefore make the company an investment alternative for

additional groups of investors.

VALUATION

DIC Asset is the company with the highest discount to its NAV in our coverage

universe and it is also one of the cheapest companies in terms of the P/FFO ratio.

We reiterate our BUY recommendation.

28/01/2016

Buy (Buy )

10.50 EUR (10.50 EUR )

Close 25/01/2016 8.70 EUR

Bloomberg: DIC GY WKN: A1X3XX

Sector Real Estate




Compared to SDAX

YTD 1.8%

1 month 1.7%

12 months -11.8%

Share data

EV (m EUR; 2016) 1,541



Free float 66.8%



SWOT


• Discount to NAV, low P/FFO ratio

•

• Strong cash flow

• Reduction of debt

• Opportunities for vacancy reduction

• Excellent progress of the MainTor project


• Low equity ratio

• Ownership structure

• Dilutive capital increases

• Still relatively refinancing terms (4.6 years)

• 2016 probably lower rental income due to portfolio reduction


• Aydin Karaduman (CEO)

• Sonja Wärntges (CFO)

• Rainer Pillmayer (COO)

• Johannes von Mutius (CIO)

DIC Asset AG is a German commercial real estate company with property

assets worth roughly € 2.4 bn and total AuM of more than € 3 bn. Office

properties account for some 70% of the company’s portfolio. 90% of its own

property assets are held in a commercial portfolio, and roughly 10% are co-

investments (funds and developments). DIC Asset offers property

management services (DIC Onsite) with branch offices in Frankfurt,

Mannheim, Dusseldorf, Hamburg, Berlin and Munich.


• LTV to be below 60%

• 2016: funds volume set to reach € 1 bn

• -

• -



Next event: 03/02/2016 Preliminary Results Dt. Imm. Chancen-Gruppe 33.2

solvia Vermögensverwaltung 5.1

RAG Stiftung 4.8



5

15

25

35

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

27.0%

21.0%10.0%

7.0%

35.0%

Public Sector

Retail

Telco/IT/Multimedia

Industry

Others

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 134.9 110.4 111.5

Consensus 135.0 117.4 114.8

EBITDA (in m EUR)

BHL 129.9 126.4 92.8

Consensus 124.0 117.1 93.6

EPS (EUR)

BHL 0.48 0.65 0.25

Consensus 0.72 0.65 0.67

2013 2014 2015e 2016e 2017e

ROCE 2.8% 3.2% 4.0% 4.9% 3.2%

Gross Yield 5.5% 6.9% 7.0% 7.1% 6.8%

EBITDA margin 83.7% 82.5% 96.3% 114.4% 83.3%

FFO-Marge 36.7% 32.5% 35.8% 39.4% 42.5%

FFO-Yield 7.5% 5.5% 5.4% 4.8% 5.1%

Equity ratio 30.5% 30.5% 34.3% 41.0% 41.6%

Net gearing 2.1 2.0 1.7 1.2 1.2

Net debt / EBITDA 15.9 12.9 10.3 7.4 10.5

Interest cover > 10 1.0 > 10 > 10 > 10



DIC Asset AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 125.2 147.5 134.9 110.4 111.5


Total sales 153.8 185.7 170.5 143.3 145.4





EBITDA 104.8 121.7 129.9 126.4 92.8

Depreciation 35.4 43.0 41.3 33.8 34.2

EBITA 69.4 78.6 88.5 92.5 58.7



EBIT 69.4 78.6 88.5 92.5 58.7




EBT 18.0 15.7 36.6 51.4 21.7

Taxes -2.0 -1.7 -3.5 -6.3 -4.0



Minority interest -0.1 0.8 -0.4 -0.5 -0.2

Net income (adj.) 15.9 14.8 32.7 44.6 17.4

No. of shares 49.0 68.6 68.6 68.6 68.6

EPS 0.33 0.22 0.48 0.65 0.25


2013 2014 2015e 2016e 2017e

Gross margin 72.0% 67.2% 68.6% 68.0% 67.7%

EBITDA margin 83.7% 82.5% 96.3% 114.4% 83.3%

EBITA margin 55.4% 53.3% 65.6% 83.8% 52.6%

EBIT margin 55.4% 53.3% 65.6% 83.8% 52.6%

EBT margin 14.4% 10.6% 27.1% 46.5% 19.5%


Tax rate 10.9% 10.5% 9.6% 12.2% 18.6%



Sales -1.0% 17.8% -8.6% -18.1% 0.9%

EBITDA 2.7% 16.1% 6.8% -2.7% -26.6%

EBIT 1.2% 13.3% 12.6% 12.6% -36.6%

EBT 27.2% -12.8% >100% 40.3% -57.7%

Net income (adj.) 36.4% -7.0% >100% 36.4% -60.9%

EPS 27.2% -33.6% >100% 36.4% -60.9%


Key figures



DIC Asset AG – Balance sheet


Fixed assets 2,392 2,276 2,070 1,694 1,762

Property, plant and equipment 2,257 2,145 1,937 1,563 1,634




Current assets 204.3 261.2 218.2 270.3 155.5

Inventories 0.0 1.7 1.7 1.7 1.7



Securities 0.0 0.0 0.0 0.0 0.0

Cash 56.4 97.4 74.5 126.5 51.8

Total assets 2,596 2,537 2,288 1,964 1,918




Minorities 5.5 4.7 4.7 4.7 4.7

Non-current liabilities 1,608 1,324 1,387 1,042 1,002



Long-term financial debt 1,553 1,260 1,325 980.3 940.3



Short-term debt 170.7 405.8 85.8 85.8 85.8






DIC Asset AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 92.1% 89.7% 90.5% 86.2% 91.9%



Current assets 7.9% 10.3% 9.5% 13.8% 8.1%

Inventories 0.0% 0.1% 0.1% 0.1% 0.1%


Cash 2.2% 3.8% 3.3% 6.4% 2.7%







Short-term debt 6.6% 16.0% 3.8% 4.4% 4.5%





DIC Asset AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 15.9 14.8 32.7 44.6 17.4

Depreciation 35.4 43.0 41.3 33.8 34.2



Other 32.8 -15.8 0.1 0.3 0.2


Change in inventory 35.3 -1.7 0.0 0.0 0.0

Change in accounts receivable -0.5 -9.3 0.0 0.0 0.0


Change in other working capital positions -13.6 6.1 20.0 0.0 40.0


Capex, excluding maintenance -443.5 64.2 166.0 340.0 -104.5


Financial investments -23.7 8.7 -1.6 2.3 2.0



Cash-flow from investing activities -467.2 72.9 164.4 342.3 -102.5

Free cash-flow -359.7 107.3 258.5 421.0 -10.7


Increase/decrease in debt position 261.2 -57.7 -255.0 -345.0 -40.0


Other financing Cash-flow -31.8 8.6 -2.5 0.0 0.0

Dividend paid -16.0 -17.1 -24.0 -24.0 -24.0










DIC Asset AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.33 0.22 0.48 0.65 0.25


Free Cash-flow per share -5.25 1.57 3.77 6.14 -0.16


Valuation ratios

EV/Sales 17.0 14.1 14.7 14.0 14.1

EV/EBITDA 20.3 17.1 15.2 12.2 17.0

EV/EBIT 30.7 26.5 22.4 16.7 26.9



Dividend yield 5.2% 4.7% 3.8% 4.0% 4.0%


EBITDA margin 83.7% 82.5% 96.3% 114.4% 83.3%

EBIT margin 55.4% 53.3% 65.6% 83.8% 52.6%



Productivity ratios

Capital turnover 1,909.7% 1,551.6% 1,544.5% 1,546.0% 1,593.0%

Operating leverage -1.2 0.7 -1.5 -0.2 -39.2

Sales per employee 894,457 1,053,871 963,579 788,846 796,221



Financial ratios

Equity ratio 30.5% 30.5% 34.3% 41.0% 41.6%

Net financial debt (in m EUR) 1,667 1,569 1,337 939.7 974.4

Net debt / Equity 210.3% 202.5% 170.5% 116.7% 122.0%

Interest cover > 10 1.0 > 10 > 10 > 10

Net debt / EBITDA 15.92 12.89 10.29 7.44 10.50



WC /sales -0.3% 9.1% 10.0% 12.2% 12.1%




Cash conversion cycle -1 33 37 45 44

Invest. (property/plant/equity) / Depreciation 1253.5% -149.1% -401.5% -1004.5% 305.9%

Others

Sales CAGR (last 3 years) -18.0% 8.1% 2.2% -4.1% -8.9%

EBIT CAGR (last 3 years) -2.4% 5.9% 8.9% 10.1% -9.3%

Net income CAGR (last 3 years) -0.9% 12.2% 40.9% 40.9% 5.5%

Pay out ratio 107.6% 162.0% 73.5% 53.9% 137.8%

Free cash-flow (in m EUR) -359.7 107.3 258.5 421.0 -10.7

Free cash flow yield -78.4% 21.1% 40.4% 70.6% -1.8%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 329.4 346.3 346.3 359.8 375.3

EBIT 5.5 11.4 -1.0 10.9 15.8

EBIT margin 1.7% 3.3% -0.3% 3.0% 4.2%


Free cash-flow 34.3 -16.2 -32.3 2.3 3.6

EPS (in EUR) -0.12 0.36 -0.61 0.56 1.03

DPS (in EUR) 0.00 0.00 0.00 0.00 0.10

Dividend yield 0.0% 0.0% 0.0% 0.0% 1.4%

EV/Sales 0.4 0.4 0.4 0.4 0.4

EV/EBIT 25.9 12.1 -150.0 12.5 8.4

Price Earnings ratio (P/E) -119.8 32.1 -12.5 12.5 6.8


Next event


Change in model

Sales EBIT EPS

2015e -1.4% -108.9% -210.2%

2016e -1.4% -26.5% -43.0%

2017e -1.4% -12.9% -21.6%

Analyst

Wolfgang Specht , Analyst

Phone: +49 (0)211 4952-637

[email protected]


euromicron AG Restructuring still not completed

Euromicron is still in the midst of a costly restructuring phase. Based on our

estimates, we expect the company to end FY 2015 with a net loss and a negative

FCF. With lower revenue and earnings estimates for 2015-17, we have lowered our

price target from € 9.70 to € 7.70.

INVESTMENT CASE

In FY 2015, Euromicron was once more forced to reduce its guidance in the course

of the year. Despite expected positive earnings in Q4, we project a net loss for the

full year. In view of higher net debt (BHL 2015e: € 87 m vs. € 49 m in 2014, partly

driven by dispensing with factoring), debt restructuring appears to be highly likely in

the current year. In terms of the operating performance, we project a significant

increase in profitability in 2016 thanks to a lower cost base and new structures in

the group. However, market expectations for a recovery of EBITDA and EPS in 2016

and 2017 are too high, in our view. We believe that the company needs to return to

sustainable growth and positive FCFs before the capital market will consider a

higher valuation to be justified.

CATALYSTS

• FY 2016 outlook: We expect a revenue guidance of € 340-360 m with a target

range for the EBITDA margin of 5-7%.

• Order book as per 31/12/2015: BHLe € 130 m (+7% yoy).

• Debt restructuring: We expect a slight increase in the financing conditions.

VALUATION

We analyse Euromicron stock based on a three-stage DCF model. A peer-group

comparison with EV/EBIT and P/FCF multiples for 2016e and 2017e would allow for

a ~ 10% higher valuation.

28/01/2016

Hold (Hold )

7.70 EUR (9.70 EUR )

Close 25/01/2016 7.00 EUR

Bloomberg: EUCA GY WKN: A1K030

Sector Technology





YTD 1.5%

1 month -2.6%

12 months -32.7%

Share data

EV (m EUR; 2016) 136.1



Free float 100.0%



SWOT


• Positioning in structural growth markets

• Options for bolt-on acquisitions

• Potential acquisition target

• Important customers are resolving investment logjam

• New regional market entries


• Loss of investor confidence after profit warnings in 2014/2015

• Stagnating order book

• Pricing pressure in the high-margin manufacturing business

• Strengthening of equity capital might be necessary

• Resuming of dividend payment not decided yet


• Bettina Meyer

• Jürgen Hansjosten

Frankfurt-based Euromicron AG is a provider of complete infrastructure

solutions for communications, transport, security and data networks. The

company acts as a manufacturer, system integrator and distributor. Its

portfolio comprises planning, implementing and maintaining networks, as

well as developing, producing and distributing network components based

on optical transmission technology.


• 2014: revenue lower end € 340-360 m; EBITDA margin 2-4% • EBITDA margin 8-11%



Next event: 23/03/2016 Annual Results Universal Investment 2.8

MMP 2.6

Lazard 2.3



5

10

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

34.3%

34.8%

30.9% North

South

WAN services

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 346.3 359.8 375.3

Consensus 345.6 360.0 375.0

EBIT (in m EUR)

BHL -1.0 10.9 15.8

Consensus 3.1 14.1 18.7

EPS (EUR)

BHL -0.61 0.56 1.03

Consensus 0.43 0.95 1.41

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 1.9% 1.8% 2.7% 3.2% 3.5%


ROCE 2.7% 6.3% -0.4% 4.9% 6.9%


Equity ratio 37.3% 38.4% 36.3% 36.6% 37.8%

Net debt / Equity 31% 49% 82% 76% 68%

Net debt / EBITDA 2.6 2.6 8.6 3.8 2.9

Interest cover > 10 > 10 -0.2 > 10 > 10



euromicron AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 329.4 346.3 346.3 359.8 375.3


Total sales 333.7 351.7 351.6 364.8 380.3





EBITDA 14.4 21.1 10.1 21.9 27.5

Depreciation 8.9 9.7 11.1 11.0 11.7

EBITA 5.5 11.4 -1.0 10.9 15.8



EBIT 5.5 11.4 -1.0 10.9 15.8


Income on ordinary activities 1.7 7.8 -5.2 6.5 11.6


EBT 1.7 7.8 -5.2 6.5 11.6

Taxes -2.5 -4.9 1.1 -2.0 -3.5

Net income from cont. operations -0.8 2.9 -4.1 4.5 8.1



Net income (adj.) -0.9 2.6 -4.4 4.0 7.4

No. of shares 7.2 7.2 7.2 7.2 7.2

EPS -0.12 0.36 -0.61 0.56 1.03


2013 2014 2015e 2016e 2017e

Gross margin 46.4% 47.3% 46.4% 47.5% 48.0%

EBITDA margin 4.4% 6.1% 2.9% 6.1% 7.3%

EBITA margin 1.7% 3.3% -0.3% 3.0% 4.2%

EBIT margin 1.7% 3.3% -0.3% 3.0% 4.2%

EBT margin 0.5% 2.2% -1.5% 1.8% 3.1%

Net profit margin -0.3% 0.7% -1.3% 1.1% 2.0%

Tax rate 144.7% 63.2% 21.4% 30.7% 30.1%



Sales -0.2% 5.1% 0.0% 3.9% 4.3%

EBITDA -42.5% 46.7% -51.9% >100% 25.6%

EBIT -67.8% >100% --- --- 45.0%

EBT -86.1% >100% --- --- 78.4%

Net income (adj.) --- --- --- --- 84.9%

EPS --- --- --- --- 84.9%


Key figures



euromicron AG – Balance sheet


Fixed assets 155.1 150.7 149.1 149.7 151.2





Current assets 173.8 136.7 143.3 150.6 159.9

Inventories 28.0 29.0 28.5 29.6 30.8



Securities 0.0 0.0 0.0 0.0 0.0

Cash 38.8 15.6 23.2 25.8 29.7

Total assets 328.9 287.4 292.4 300.3 311.1




Minorities 0.4 0.4 0.4 0.4 0.4







Short-term debt 34.7 22.9 42.8 42.8 42.8






euromicron AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 47.2% 52.4% 51.0% 49.9% 48.6%



Current assets 52.8% 47.6% 49.0% 50.1% 51.4%

Inventories 8.5% 10.1% 9.7% 9.8% 9.9%


Cash 11.8% 5.4% 7.9% 8.6% 9.5%







Short-term debt 10.6% 8.0% 14.7% 14.3% 13.8%





euromicron AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -0.9 2.6 -4.4 4.0 7.4

Depreciation 8.9 9.7 11.1 11.0 11.7



Other -10.0 -6.8 0.0 -0.1 0.0


Change in inventory -0.5 -1.1 0.6 -1.1 -1.3

Change in accounts receivable -1.6 12.6 0.4 -3.3 -3.8

Change in accounts payable 11.8 -10.4 -2.6 2.5 1.8

Change in other working capital positions 30.8 -8.3 -28.0 0.6 0.7

Operating Cash-flow 39.4 -1.9 -22.8 13.8 16.7


Payments for acquisitions 0.0 -8.0 0.0 0.0 0.0





Free cash-flow 34.3 -16.2 -32.3 2.3 3.6





Dividend paid -2.0 0.0 0.0 0.0 0.0

Cash-flow from financing activities -0.9 -7.0 39.9 0.3 0.3

Increase/ decrease in liquid assets 33.4 -23.2 7.6 2.6 3.9



Change in total cash and cash equivalents 33.4 -23.2 7.6 2.6 3.9





euromicron AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.12 0.36 -0.61 0.56 1.03




Valuation ratios

EV/Sales 0.4 0.4 0.4 0.4 0.4

EV/EBITDA 9.9 6.5 14.1 6.2 4.8

EV/EBIT 25.9 12.1 -150.0 12.5 8.4



Dividend yield 0.0% 0.0% 0.0% 0.0% 1.4%


EBITDA margin 4.4% 6.1% 2.9% 6.1% 7.3%

EBIT margin 1.7% 3.3% -0.3% 3.0% 4.2%

Net return on sales -0.3% 0.7% -1.3% 1.1% 2.0%

Return on capital employed (ROCE) 2.7% 6.3% -0.4% 4.9% 6.9%

Productivity ratios


Operating leverage 0.7 -1.1 1.1 12.5 -0.4


EBIT per employee 3,159 6,401 0 6,049 8,696


Financial ratios

Equity ratio 37.3% 38.4% 36.3% 36.6% 37.8%


Net debt / Equity 30.9% 49.3% 81.8% 76.5% 68.3%

Interest cover > 10 > 10 -0.2 > 10 > 10

Net debt / EBITDA 2.63 2.58 8.55 3.84 2.92



WC /sales 21.8% 20.4% 20.8% 20.6% 20.6%






Others




Pay out ratio 0.0% 0.0% 0.0% 0.0% 9.7%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 86 89 122 149 166

EBITDA 14 13 23 14 15

EBITDA margin 16.3% 15.0% 18.6% 9.6% 9.0%

Net financial debt -79 -67 -121 -114 -114

Free cash-flow -25 -3 54 -7 0

EPS (in EUR) -0.18 -0.05 0.08 0.02 0.03

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales -0.7 4.6 3.5 2.3 2.1

EV/EBITDA -4.3 31.0 18.9 23.8 22.8

Price Earnings ratio (P/E) -19.8 -69.1 53.6 170.4 137.5


Next event


Change in model

Sales EBITDA EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Volker Braun

Phone: +49 (0)211 4952-453

[email protected]


Evotec AG Critical mass reached – momentum accelerating

We believe that the opportunities that may arise from 70 partner projects currently

are greatly underestimated. What is more, the potential from the cooperation with

Sanofi, signed last year, is also not adequately reflected, in our view. The ability to

self-finance research projects is an advantage in times when it is more difficult for

biotech companies worldwide to find refinancing options.

INVESTMENT CASE

Being one of the world’s leading companies in this field, Evotec can benefit greatly

from the steadily growing demand for outsourcing services in early-phase research.

The Service business (EVT Execute) is generating double-digit margins. A large

portion of its earnings is used to set up and expand a product pipeline (EVT

Innovate). With more than 70 partner projects, we feel it is only a matter of time

before at least one candidate enters the market.

CATALYSTS

The two recent milestone payments from Bayer and Janssen should enable the

company to meet the market’s expectations when it publishes its 2015 results. For

2016, we project another year of double-digit growth due to the recently concluded

strategic alliance with UCB (Belgium) in the field of compound management.

Furthermore, we believe that Evotec should be able to win a commercial partner for

two of 13 projects currently without a partnership, and further projects should

move onto clinical trials.

VALUATION

We analyse the company based on an SOTP valuation for the two divisions EVT

Execute (€ 2.50; peer group) and EVT Innovate (€ 1.20; NPV of pipeline) and the

current estimated net liquidity (€ 0.90). Our analysis of EVT Innovate only takes

account of projects with a commercial partner. In total, we arrive at a fair value of

€ 4.60.

28/01/2016

Buy (Buy )

4.60 EUR (4.60 EUR )

Close 25/01/2016 3.47 EUR

Bloomberg: EVT GY WKN: 566480

Sector Healthcare/Pharma




Compared to TecDAX

YTD -9.1%

1 month -8.4%

12 months -19.4%

Share data

EV (m EUR; 2016) 342



Free float 75.0%



SWOT


• Top-3 position in market for services in early-phase drug research

• Pipeline consisting of more than 70 partner projects

• High level of customer satisfaction

• Pharmaceuticals industry is increasingly interested in outsourcing

• Balanced risk/reward ratio


• Product development risk

• Financially less powerful than clients

• Intense competition

• Sudden changes of strategy among clients

• Employee risk


• Dr Werner Lanthaler (CEO)

• Colin Bond (CFO)

• Dr Cord Dohrmann (CSO)

• Dr Mario Polywka (COO)

Evotec is one of the world’s leading providers of services for early-phase

drug research and development. The company’s core activities include the

whole process from screening through to completion of pre-clinical

development candidates (PDCs). Evotec is therefore one of the few fully

integrated providers of early-phase drug discovery services.


• Approximately 45% revenue growth in 2015E - exclusive milestones, up-

fronts, royalties

• Positive adjusted EBITDA

• Cash assets worth well over € 100m by end of 2015

• -



Next event: Annual Results 22/03/16 Roland Oetker / ROI 13.0

TVM Capital 5.4

BVF Partners Group 12.0



20

40

60

80

100

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

86.4%

13.6%

EVT Execute

EVT Innovate

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 122 149 166


EBITDA (in m EUR)

BHL 23 14 15

Consensus 14 20 25

EPS (EUR)

BHL 0.08 0.02 0.03

Consensus 0.08 0.06 0.09

2013 2014 2015e 2016e 2017e

R&D/Sales 11.2% 13.9% 15.4% 12.8% 15.9%

Capex/Sales 6.0% 5.9% 8.0% 6.0% 8.0%


ROCE -10.4% -3.5% 6.9% 1.9% 2.2%

Free cash flow yield -5.6% -0.5% 11.8% -1.5% 0.0%

Equity ratio 69.9% 70.5% 60.6% 62.1% 63.1%

Net debt / Equity -50% -42% -72% -67% -65%

Net debt / EBITDA -5.6 -5.0 -5.3 -8.0 -7.6

Interest cover < -10 < -10 > 10 > 10 > 10



Evotec AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 86 89 122 149 166

Cost of Sales -55 -60 -82 -95 -101

Gross profit 31 29 40 55 65

Sales and marketing 0 0 0 0 0



Other operating result -23 -5 18 -3 -3

EBITDA 14 13 23 14 15


EBITA 7 5 16 7 7

Amortisation of goodwill -2 0 0 0 0


EBIT -18 -6 13 4 4

Financial result -2 1 0 -1 -1

Income on ordinary activities -21 -5 13 3 3


EBT -21 -5 14 3 3

Taxes -2 -2 -3 0 0

Net income from cont. operations -22 -7 10 3 3



Net income (adj.) -22 -7 10 3 3

No. of shares 121 131 132 132 132

EPS (in EUR) -0.18 -0.05 0.08 0.02 0.03


2013 2014 2015e 2016e 2017e

Gross margin 36.3% 32.8% 32.4% 36.6% 39.0%

EBITDA margin 16.3% 15.0% 18.6% 9.6% 9.0%

EBITA margin 8.0% 5.1% 13.4% 4.8% 4.4%

EBIT margin -21.3% -7.1% 10.9% 2.5% 2.5%

EBT margin -24.0% -5.8% 11.1% 1.8% 2.0%

Net profit margin -26.1% -7.8% 8.4% 1.8% 2.0%

Tax rate -8.7% -35.3% 24.9% 0.0% 0.0%



Sales -1.5% 4.1% 36.4% 22.4% 11.2%

EBITDA 49.0% -4.6% 69.4% -36.6% 4.2%

EBIT >100% -65.2% --- -72.3% 11.7%

EBT >100% -75.0% --- -80.3% 23.9%

Net income (adj.) --- -68.9% --- -73.8% 23.9%

EPS 0,0% -71.3% --- -73.8% 23.9%


Key figures



Evotec AG – Balance sheet


Fixed assets 105 99 100 98 100





Current assets 123 125 179 178 176





Cash 46 49 104 92 89

Total assets 227 225 278 276 277

















Evotec AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 46.1% 44.2% 35.8% 35.5% 36.3%



Current assets 53.9% 55.8% 64.2% 64.5% 63.7%

Inventories 1.0% 1.4% 1.5% 1.7% 1.8%


Cash 20.1% 21.7% 37.4% 33.4% 32.3%







Short-term debt 7.6% 5.9% 5.1% 4.8% 4.4%





Evotec AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -25 -7 10 3 3



Change of provisions -4 -3 23 0 0

Other 8 2 0 0 -1


Change in inventory 0 -1 -1 -1 0

Change in accounts receivable -2 -9 3 -10 -1

Change in accounts payable 0 2 1 0 1

Change in other working capital positions -3 -8 18 0 0

Operating Cash-flow 7 -4 63 2 13


Payments for acquisitions -1 -4 0 0 0

Financial investments -46 -26 0 0 0



Cash-flow from investing activities -32 1 -10 -9 -13

Free cash-flow -25 -3 54 -7 0


Increase/decrease in debt position 0 4 2 -5 -3


Other financing Cash-flow 0 0 0 0 0

Dividend paid 0 0 0 0 0

Cash-flow from financing activities 32 5 2 -5 -3

Increase/ decrease in liquid assets 7 2 55 -12 -3

Effects of exchange rate changes -1 1 0 0 0


Change in total cash and cash equivalents 7 3 55 -12 -3





Evotec AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.18 -0.05 0.08 0.02 0.03


Free Cash-flow per share -0.21 -0.02 0.41 -0.05 0.00


Valuation ratios

EV/Sales -0.7 4.6 3.5 2.3 2.1

EV/EBITDA -4.3 31.0 18.9 23.8 22.8

EV/EBITDA 3.3 -65.1 32.1 92.6 82.9

Price Earnings ratio (P/E) -19.8 -69.1 53.6 170.4 137.5


Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin 16.3% 15.0% 18.6% 9.6% 9.0%

EBIT margin -21.3% -7.1% 10.9% 2.5% 2.5%

Net return on sales -26.1% -7.8% 8.4% 1.8% 2.0%

Return on capital employed (ROCE) -10.4% -3.5% 6.9% 1.9% 2.2%

Productivity ratios


Operating leverage 11.4 3.4 0.6 -0.4 0.0


EBIT per employee 0 0 20,092 5,566 6,216


Financial ratios

Equity ratio 69.9% 70.5% 60.6% 62.1% 63.1%

Net financial debt (in m EUR) -79 -67 -121 -114 -114

Net debt / Equity -49.6% -42.5% -71.8% -66.7% -65.5%

Interest cover < -10 < -10 > 10 > 10 > 10

Net debt / EBITDA -5.63 -5.03 -5.34 -7.95 -7.64


Change Working Capital (in m EUR) 13 5 -3 11 1

WC /sales 15.7% 21.1% 12.8% 18.1% 16.7%






Others



Net income CAGR (last 3 years) -295.8% -210.7% 60.4% -149.2% -178.0%

Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) -25 -3 54 -7 0

Free cash flow yield -137.2% -0.5% 9.8% -1.5% 0.0%




in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Sales 852.0 852.1 920.0 952.2 999.8

EBIT 105.8 108.9 79.0 69.0 82.9

EBIT margin 12.4% 12.8% 8.6% 7.2% 8.3%

Net financial debt -53.9 -20.1 33.6 48.3 23.3

Free cash-flow 54.4 4.1 -20.0 8.2 47.9

EPS (in EUR) 1.55 1.56 1.08 0.93 1.14

DPS (in EUR) 0.75 0.75 0.50 0.50 0.75

Dividend yield 2.5% 2.3% 3.4% 4.5% 6.7%

EV/Sales 1.6 1.7 0.8 0.6 0.5

EV/EBIT 12.8 13.3 9.0 8.1 6.5



Next event


Change in model

Sales EBIT EPS

2014/15e 1.1% 4.6% 5.1%

2015/16e -2.7% -19.9% -21.7%

2016/17e -2.7% -16.1% -17.3%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Gerry Weber International AG New direction announced

In view of the still-difficult market environment, we stick to our neutral view of the

stock and reiterate our HOLD rating with a new price target of € 14.50 (previously:

€ 17.00).

INVESTMENT CASE

In order to take its growth to the next level, the company needs to make some

adjustments to its Gerry Weber core brand and change its structures and processes.

In the autumn, the company had published a first detailed restructuring plan

concerning procurement, retail, logistics and the brands. This means, that the next

18 to 24 months represent a period of transformation and stabilisation for the core

segments in order to improve the profitability in the medium term. Thus, a

consolidation of the revenues and earnings is unavoidable. However, in the medium

term, we see a return to growth:

• The implementation of the verticalisation strategy, and thus the better

management of the complete value chain from procurement to the point of

sales, should lead to higher margins.

• At the same time, it is necessary to strengthen the brand awareness for Gerry

Weber with targeted marketing activities and to optimise the international

sales organisation.

In contrast, Hallhuber is still a growth story. The business model is already fully

verticalised and focused on in-house retail space. We still see potential for

expansion in Germany and Europe.

CATALYSTS

Gerry Weber will release details about the restructuring plan on 26 February in

order to show investors how the company will develop in future.

VALUATION

Our price target is still based on a DCF model. The dividend yield should support the

share price at the current level.

28/01/2016

Hold (Hold )

14.50 EUR (17.00 EUR )

Close 25/01/2016 11.14 EUR

Bloomberg: GWI1 GY WKN: 330410

Sector Consumer




Compared to SDAX

YTD -4.4%

1 month -3.6%

12 months -77.3%

Share data

EV (m EUR; 2016) 559.8



Free float 53.6%



SWOT


• Synergies and economies of scale due to operating and virtual efficiency

• Attractive target group

• New logistics centre put into operation on schedule

• Expansion of the e-commerce segment


• P&L and balance sheet growth dependent on weather

• Room for improvement in the accessories business

• Expansion of the retail segment is changing the fixed costs structure

• Brand imagine calls for modernisation


• Ralf Weber (CEO)

• Dr. David Frink (CFO)

• Norbert Steinke (CRO)

Gerry Weber International AG is a fashion and lifestyle company that offers

women’s wear and accessories in international fashion markets. Its brands

include GERRY WEBER, TAIFUN, SAMOON by GERRY WEBER and

HALLHUBER. The company markets its products through company-owned or

franchised retail stores, mono-label stores, online shops, and through a

shop-in-shop concept. Gerry Weber was founded in 1973 and is

headquartered in Halle Westphalia, Germany.


• 2014/15 revenues: growth in upper single-digit range

• 2014/15 operating earnings: 20 - 25% below prev. year

• -



Next event: 26/02/2016 Annual Results Gerhard Weber 29.1

Udo Hardieck 17.4

Ralf Weber 3.3



7

10

13

16

19

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

52.5%47.5%Wholesale

Retail

Company Overview

2014/15e 2015/16e 2016/17e

Sales (in m EUR)

BHL 920.0 952.2 999.8

Consensus 911.3 958.4 1,013

EBIT (in m EUR)

BHL 79.0 69.0 82.9

Consensus 78.3 85.9 97.9

EPS (EUR)

BHL 1.08 0.93 1.14

Consensus 1.05 1.16 1.37

2012/1

3 2013/1

4 2014/1

5e 2015/1

6e 2016/1

7e R&D/Sales - - - - -

Capex/Sales 3.9% 6.8% 11.5% 6.7% 3.3%


ROCE 26.0% 20.2% 14.3% 12.0% 13.8%

Free cash flow yield 3.9% 0.3% -2.9% 1.2% 7.0%

Equity ratio 74.4% 66.4% 66.6% 67.1% 68.0%

Net debt / Equity -14% -4% 7% 10% 4%

Net debt / EBITDA -0.4 -0.2 0.3 0.5 0.2

Interest cover 0.0 0.0 0.0 > 10 0.0



Gerry Weber International AG – Income statement

in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Sales 852.0 852.1 920.0 952.2 999.8


Total sales 844.0 879.9 920.0 952.2 999.8





EBITDA 127.4 134.2 115.0 105.0 118.9

Depreciation 21.6 25.3 36.0 36.0 36.0

EBITA 105.8 108.9 79.0 69.0 82.9



EBIT 105.8 108.9 79.0 69.0 82.9




EBT 102.8 104.6 72.1 61.9 75.8

Taxes -31.8 -33.2 -22.4 -19.2 -23.5




Net income (adj.) 71.0 71.4 49.7 42.7 52.3

No. of shares 45.9 45.9 45.9 45.9 45.9

EPS 1.55 1.56 1.08 0.93 1.14


2012/13 2013/14 2014/15e 2015/16e 2016/17e

Gross margin 54.7% 54.1% 53.8% 58.0% 58.0%

EBITDA margin 15.0% 15.7% 12.5% 11.0% 11.9%

EBITA margin 12.4% 12.8% 8.6% 7.2% 8.3%

EBIT margin 12.4% 12.8% 8.6% 7.2% 8.3%

EBT margin 12.1% 12.3% 7.8% 6.5% 7.6%


Tax rate 30.9% 31.7% 31.0% 31.0% 31.0%



Sales 6.2% 0.0% 8.0% 3.5% 5.0%

EBITDA -3.6% 5.3% -14.3% -8.7% 13.3%

EBIT -8.7% 2.9% -27.4% -12.7% 20.2%

EBT -9.6% 1.8% -31.1% -14.2% 22.5%

Net income (adj.) -9.9% 0.6% -30.3% -14.2% 22.5%

EPS -9.9% 0.6% -30.3% -14.2% 22.5%


Key figures



Gerry Weber International AG – Balance sheet


Fixed assets 274.9 327.3 397.3 424.8 422.1





Current assets 256.8 358.0 309.6 305.8 341.8

Inventories 111.5 140.7 150.0 160.0 170.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 65.6 104.3 48.6 33.8 58.8

Total assets 531.6 685.2 706.8 730.6 763.9




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 6.0 7.0 5.0 5.0 5.0






Gerry Weber International AG – Balance sheet structure

Assets 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Fixed assets 51.7% 47.8% 56.2% 58.1% 55.3%



Current assets 48.3% 52.2% 43.8% 41.9% 44.7%

Inventories 21.0% 20.5% 21.2% 21.9% 22.3%


Cash 12.3% 15.2% 6.9% 4.6% 7.7%







Short-term debt 1.1% 1.0% 0.7% 0.7% 0.7%





Gerry Weber International AG – Cash flow statement

in m EUR 2012/13 2013/14 2014/15e 2015/16e 2016/17e

Net income (adj.) 71.0 71.4 49.7 42.7 52.3

Depreciation 21.6 25.3 36.0 36.0 36.0



Other 0.0 34.4 0.0 0.0 0.0













Free cash-flow 54.4 4.1 -20.0 8.2 47.9


Increase/decrease in debt position -3.5 71.0 -2.0 0.0 0.0



Dividend paid -34.4 -34.4 -34.4 -23.0 -23.0


Increase/ decrease in liquid assets 16.4 40.7 -55.7 -14.8 25.0

Effects of exchange rate changes 0.0 -2.0 0.0 0.0 0.0


Change in total cash and cash equivalents 16.4 38.7 -55.7 -14.8 25.0





Gerry Weber International AG – Ratios

2012/13 2013/14 2014/15e 2015/16e 2016/17e

Per Share Data

EPS 1.55 1.56 1.08 0.93 1.14


Free Cash-flow per share 1.18 0.09 -0.44 0.18 1.04


Valuation ratios

EV/Sales 1.6 1.7 0.8 0.6 0.5

EV/EBITDA 10.6 10.8 6.2 5.3 4.5

EV/EBIT 12.8 13.3 9.0 8.1 6.5



Dividend yield 2.5% 2.3% 3.4% 4.5% 6.7%


EBITDA margin 15.0% 15.7% 12.5% 11.0% 11.9%

EBIT margin 12.4% 12.8% 8.6% 7.2% 8.3%



Productivity ratios


Operating leverage -1.4 453.6 -3.4 -3.6 4.0




Financial ratios

Equity ratio 74.4% 66.4% 66.6% 67.1% 68.0%

Net financial debt (in m EUR) -53.9 -20.1 33.6 48.3 23.3

Net debt / Equity -13.6% -4.4% 7.1% 9.9% 4.5%

Interest cover 0.0 0.0 0.0 > 10 0.0

Net debt / EBITDA -0.42 -0.15 0.29 0.46 0.20



WC /sales 17.2% 20.4% 19.7% 20.0% 19.9%






Others


EBIT CAGR (last 3 years) 8.3% 3.0% -12.0% -13.3% -8.7%


Pay out ratio 48.5% 48.2% 46.1% 53.8% 65.8%

Free cash-flow (in m EUR) 54.4 4.1 -20.0 8.2 47.9





in m EUR 2013/14 2014/15 2015/16 2016/17e 2017/18e

Sales 453.3 451.4 483.0 492.7 502.5

EBIT 32.0 27.3 27.1 30.3 34.6

EBIT margin 7.1% 6.0% 5.6% 6.1% 6.9%


Free cash-flow -6.2 -14.1 -4.7 15.7 19.3

EPS (in EUR) 5.45 3.72 4.18 5.10 6.00

DPS (in EUR) 2.20 1.75 1.75 1.90 2.40

Dividend yield 2.9% 2.3% 2.6% 2.9% 3.6%

EV/Sales 0.7 0.8 0.7 0.7 0.6

EV/EBIT 10.6 13.4 12.5 10.8 9.1



Next event


Change in model

Sales EBIT EPS

2015/16 --- --- ---

2016/17e --- 7.0% 8.8%

2017/18e --- 6.1% 7.4%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Gesco AG 2015/16 a transition year, albeit a better one

We reiterate our HOLD rating for Gesco with a price target of € 72.00 (previously:

€ 70.00). We anticipate improvements for Gesco in 2015/16, even though the

company has still not returned to its former strength. As such, 2015/16 will remain

a year of transition, in our view, albeit a better one.

INVESTMENT CASE

For the Gesco group, we expect a slight increase in order intake and revenue in the

current financial year. As a manufacturer of investment goods, Gesco benefits only

to a limited extent from a strongly consumption-driven economic recovery. In

addition, demand for agricultural machinery from Eastern Europe is set to remain

weak, which continues to curb growth at the subsidiary Frank Walz- and

Schmiedetechnik GmbH. Moreover, although low energy prices have been

stimulating the economy overall, they have led to declining demand from oil

industry customers for SVT GmbH. In both of the above mentioned restructuring

cases, the company laid the strategic foundation in 2014/15 and initiated the

required operational counter-measures. However, the group margins are likely to

still be negatively affected by these two companies in the current financial year.

Overall, the group is set to achieve organic revenue growth as well as external

growth through Setterstix. However, in our view, the margin is still much too low.

CATALYSTS

For the Gesco group, we currently see no sign of an overall drop in demand, but also

no sustainable impetus for growth to justify a BUY rating.

VALUATION

All in all, we believe that in the medium term, Gesco should be able to return to its

previous profitability and thus to an EBIT margin of between 8% and 10% (BHLe:

2015/16 5.6%). Our price target of € 72.00 is based on a DCF model.

28/01/2016

Hold (Hold )

72.00 EUR (70.00 EUR )

Close 25/01/2016 66.49 EUR

Bloomberg: GSC1 GY WKN: A1K020

Sector Industrial





YTD 2.8%

1 month 1.9%

12 months 2.9%

Share data

EV (m EUR; 2016) 328.5



Free float 86.3%



SWOT


• Focused on market-leading niche companies

• Prudent acquisition strategy; good track record

• Solid balance sheet with limited goodwill

• Diversified portfolio reduces earnings volatility

• Attractive and sustainable dividend policy


• Periodic capital increases

• Dörrenberg accounts for more than one fifth of revenue

• Holding structure is unpopular with institutional investors


• Dr Hans-Gert Mayrose

• Robert Spartmann

• Dr Eric Bernhard

As a holding company, Gesco AG acquires profitable, strategically interesting

German industrial SMEs in order to own them for some time and develop the

companies. The portfolio currently encompasses 17 companies. The

takeovers essentially take place when the former owner sells because there

is no successor to run the company. The new CEO appointed by Gesco

usually has a 10-20% stake in the capital stock and therefore also bears a

part of the entrepreneurial risk.


• 2015/16: Revenue between € 480 m and € 490 m

• 2015/16: Annual net profit at the upper end or slightly above a range of

€ 12.5-14.0 m

• -



Next event: 12/02/2016 Quarterly Results Stefan Heimöller 14.4

Investmentges. langfristige Investoren 10.5



7

10

13

16

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

93.6%

6.4%

Tool Manufacture &Mechanical Engineering

Plastics Technology

Company Overview

2015/16 2016/17e 2017/18e

Sales (in m EUR)

BHL 483.0 492.7 502.5

Consensus 485.0 504.6 522.3

EBIT (in m EUR)

BHL 27.1 30.3 34.6

Consensus 27.8 32.8 37.0

EPS (EUR)

BHL 4.18 5.10 6.00

Consensus 4.22 5.40 6.32

2013/1

4 2014/1

5 2015/1

6 2016/1

7e 2017/1

8e R&D/Sales - - - - -

Capex/Sales 6.2% 6.9% 6.2% 3.8% 3.8%


ROCE 11.1% 8.7% 8.4% 9.1% 10.0%

Free cash flow yield -2.4% -5.6% -2.0% 6.6% 8.1%

Equity ratio 46.5% 45.3% 46.1% 47.3% 48.8%

Net debt / Equity 33% 43% 45% 38% 29%

Net debt / EBITDA 1.2 1.7 1.9 1.5 1.1

Interest cover 0.0 > 10 > 10 0.0 0.0



Gesco AG – Income statement

in m EUR 2013/14 2014/15 2015/16 2016/17e 2017/18e

Sales 453.3 451.4 483.0 492.7 502.5


Total sales 446.7 467.8 483.0 492.7 502.5





EBITDA 48.7 46.2 46.1 50.3 55.6

Depreciation 16.7 18.9 19.0 20.0 21.0

EBITA 32.0 27.3 27.1 30.3 34.6



EBIT 32.0 27.3 27.1 30.3 34.6




EBT 29.0 24.6 24.5 27.7 32.0

Taxes -9.3 -10.4 -8.6 -8.7 -10.1




Net income (adj.) 18.1 12.4 13.9 16.9 19.9

No. of shares 3.3 3.3 3.3 3.3 3.3

EPS 5.45 3.72 4.18 5.10 6.00


2013/14 2014/15 2015/16 2016/17e 2017/18e

Gross margin 49.9% 47.7% 48.0% 48.0% 48.0%

EBITDA margin 10.7% 10.2% 9.5% 10.2% 11.1%

EBITA margin 7.1% 6.0% 5.6% 6.1% 6.9%

EBIT margin 7.1% 6.0% 5.6% 6.1% 6.9%

EBT margin 6.4% 5.4% 5.1% 5.6% 6.4%


Tax rate 31.9% 42.4% 35.0% 31.5% 31.5%


Growth rates yoy 2013/14 2014/15 2015/16 2016/17e 2017/18e

Sales 2.9% -0.4% 7.0% 2.0% 2.0%

EBITDA -5.9% -5.2% -0.2% 9.1% 10.7%

EBIT -14.3% -14.7% -0.9% 11.8% 14.5%

EBT -14.2% -15.4% -0.4% 13.1% 15.9%

Net income (adj.) -13.4% -31.8% 12.5% 21.9% 17.7%

EPS -13.5% -31.7% 12.4% 21.9% 17.7%


Key figures



Gesco AG – Balance sheet

Assets (in m EUR) 2013/14 2014/15 2015/16 2016/17e 2017/18e

Fixed assets 146.4 165.9 176.9 175.6 173.7





Current assets 233.6 237.8 237.6 251.4 268.3

Inventories 119.2 135.1 139.5 142.3 145.2



Securities 0.0 0.0 0.0 0.0 0.0

Cash 38.8 35.3 28.8 38.7 51.6

Total assets 380.0 403.7 414.5 427.0 442.1




Minorities 12.4 14.5 14.5 14.5 14.5







Short-term debt 32.0 35.5 35.5 35.5 35.5






Gesco AG – Balance sheet structure

Assets 2013/14 2014/15 2015/16 2016/17e 2017/18e

Fixed assets 38.5% 41.1% 42.7% 41.1% 39.3%



Current assets 61.5% 58.9% 57.3% 58.9% 60.7%

Inventories 31.4% 33.5% 33.7% 33.3% 32.8%


Cash 10.2% 8.7% 6.9% 9.1% 11.7%







Short-term debt 8.4% 8.8% 8.6% 8.3% 8.0%





Gesco AG – Cash flow statement

in m EUR 2013/14 2014/15 2015/16 2016/17e 2017/18e

Net income (adj.) 18.1 12.4 13.9 16.9 19.9

Depreciation 16.7 18.9 19.0 20.0 21.0


Change of provisions -1.7 6.0 -3.6 0.0 0.0

Other -1.6 2.4 0.0 0.0 0.0



Change in accounts receivable -12.1 11.5 -1.8 -1.1 -1.2










Free cash-flow -6.2 -14.1 -4.7 15.7 19.3




Other financing Cash-flow -1.4 0.5 4.0 0.0 0.0

Dividend paid -8.3 -7.3 -5.8 -5.8 -6.3

Cash-flow from financing activities 8.5 10.6 -1.8 -5.8 -6.3

Increase/ decrease in liquid assets 2.4 -3.6 -6.5 9.9 13.0



Change in total cash and cash equivalents 2.4 -3.6 -6.5 9.9 13.0





Gesco AG – Ratios

2013/14 2014/15 2015/16 2016/17e 2017/18e

Per Share Data

EPS 5.45 3.72 4.18 5.10 6.00


Free Cash-flow per share -1.86 -4.24 -1.41 4.72 5.80


Valuation ratios

EV/Sales 0.7 0.8 0.7 0.7 0.6

EV/EBITDA 6.9 7.9 7.3 6.5 5.7

EV/EBIT 10.6 13.4 12.5 10.9 9.1



Dividend yield 2.9% 2.3% 2.6% 2.9% 3.6%


EBITDA margin 10.7% 10.2% 9.5% 10.2% 11.1%

EBIT margin 7.1% 6.0% 5.6% 6.1% 6.9%



Productivity ratios


Operating leverage -4.9 35.1 -0.1 5.9 7.3




Financial ratios

Equity ratio 46.5% 45.3% - 47.3% 48.8%


Net debt / Equity 32.9% 43.3% 44.9% 37.5% 29.1%

Interest cover 0.0 > 10 > 10 0.0 0.0

Net debt / EBITDA 1.19 1.72 1.86 1.51 1.13



WC /sales 32.1% 33.0% 31.9% 31.9% 31.9%






Others



Net income CAGR (last 3 years) 5.9% -18.3% -12.7% -2.2% 17.3%

Pay out ratio 40.4% 47.0% 41.9% 37.3% 40.0%

Free cash-flow (in m EUR) -6.2 -14.1 -4.7 15.7 19.3

Free cash flow yield -2.4% -5.6% -2.1% 7.1% 8.8%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,495 1,453 1,542 1,604 1,668

EBIT 28.9 71.9 145.0 183.0 202.2

EBIT margin 1.9% 5.0% 9.4% 11.4% 12.1%


Free cash-flow 46.6 98.0 68.3 112.9 127.1

EPS (in EUR) -1.48 0.16 1.84 2.66 3.10

DPS (in EUR) 0.65 0.65 0.65 0.70 0.75

Dividend yield 1.6% 1.9% 2.1% 2.6% 2.8%

EV/Sales 1.3 1.1 1.0 0.8 0.7

EV/EBIT 65.4 22.5 10.1 6.7 5.6



Next event

Trading Statement 29/01/2016

Change in model

Sales EBIT EPS

2015e --- -7.6% -10.4%

2016e --- -3.2% -4.0%

2017e --- -2.9% -3.5%

Analyst


Phone: +49 (0)211 4952-311

[email protected]


GfK SE Transformation coming to an end

We remain convinced that the company’s transformation process is coming to an

end, even though the latest corporate newsflow has shown that returning the

company to its former strength is not without its difficulties. We stand by our BUY

rating for GfK even though we have marginally lowered our price target from

€ 45.00 to € 43.00 after the margin adjustment.

INVESTMENT CASE

We see that GfK has made progress in 2015, even though the original margin target

of 12.4% – 12.8% (current BHLe: 12.1%) will probably not quite be achieved. This is

partly due to delays and therefore higher set-up costs for television research

contracts in Brazil and Saudi Arabia and partly due to a modest order pipeline in

Central Europe (CE). It is, however, important to note that the CE sector is

strategically focused on products with margin potential (such as for GfK Echo)

instead of solely on the generation of revenue.

We expect the AOI margin to improve by 150 bps to 13.6% in 2016. GfK is set to

release a margin guidance when it publishes its annual results. In this regard, we

primarily regard Audience Measurement as a factor driving higher profitability.

CATALYSTS

Above all, the newsflow should improve and the recently acquired orders in

Audience Measurement are likely to have a positive impact on the P&L from 2016

onwards. GfK should be able to generate more projects in this segment. News about

new panels and the expansion of existing panels in new countries and regions

should also boost the share price.

VALUATION

Our valuation is based on a DCF model. Looking at the stock’s PER2016e reveals that

GfK is currently trading 21% below the median of its peer group.

28/01/2016

Buy (Buy )

43.00 EUR (45.00 EUR )

Close 25/01/2016 26.42 EUR

Bloomberg: GFK GY WKN: 587530

Sector Media




Compared to SDAX

YTD -6.0%

1 month -7.1%

12 months -34.3%

Share data

EV (m EUR; 2016) 1,223



Free float 43.6%



SWOT


• Important parts of market research grow faster than the economy overall

• Flagship contracts in Audience Measurement

• Consumer Choices is an earnings mainstay with margins above 20%


• Transformation not yet fully completed

• Number of legal entities still too high

• Consumer Experiences needs to pick up


• Matthias Hartmann (CEO)

• Christian Diedrich (CFO)

• Gerhard Hausruckinger

• David Krajicek

• Alessandra Cama

GfK SE is one of the world’s largest research companies with around 13,000

experts analysing markets in over 100 countries. Its Consumer Choices

segment focuses on market sizing and currencies, convergent media, and

sales channels. Its Consumer Experiences segment deals with consumer

behaviour, perceptions, and attitudes. The company was founded in 1984

and is headquartered in Nuremberg, Germany.


• 2015: slight organic sales growth

• AOI margin of around 12%

• 2016: organic sales growth



Next event: 29/01/2016 Trading Statement GfK Nürnberg e.V.

56.4

Parvus Asset 4.9

RWC Focus

3.3



8

10

12

14

2011 2012 2013 2014 2015

PER AVG STD + 1 STD - 1

57.0%43.0% Customer Experience

Customer Choice

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,542 1,604 1,668

Consensus 1,538 1,559 1,602

EBIT (in m EUR)

BHL 145.0 183.0 202.2

Consensus 170.5 199.0 210.4

EPS (EUR)

BHL 1.84 2.66 3.10

Consensus 2.12 2.82 3.15

2013 2014 2015e 2016e 2017e

R&D/Sales 0.0% 0.0% 0.0% 0.0% 0.0%

Capex/Sales 5.5% 6.4% 1.7% 1.8% 1.9%


ROCE 2.6% 6.4% 12.9% 15.4% 16.0%


Equity ratio 39.1% 39.9% 41.8% 43.9% 46.2%

Net debt / Equity 57% 47% 39% 26% 13%

Net debt / EBITDA 1.7 1.6 1.4 0.8 0.4

Interest cover 0.7 > 10 > 10 > 10 > 10



GfK SE – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,495 1,453 1,542 1,604 1,668

Cost of Sales -1,008 -990.6 -1,049 -1,074 -1,109

Gross profit 486.8 462.3 493.4 529.2 558.7


General and administration 0.0 0.0 0.0 0.0 0.0



EBITDA 225.4 202.2 209.0 249.0 270.2

Depreciation 29.2 26.1 27.0 29.0 31.0

EBITA 196.2 176.1 182.0 220.0 239.2



EBIT 28.9 71.9 145.0 183.0 202.2




EBT 4.2 47.6 123.0 165.0 185.7

Taxes -46.2 -28.2 -43.0 -55.3 -59.4




Net income (adj.) -54.0 5.9 66.9 96.7 112.8

No. of shares 36.4 36.4 36.4 36.4 36.4

EPS (in EUR) -1.48 0.16 1.84 2.66 3.10


2013 2014 2015e 2016e 2017e

Gross margin 32.6% 31.8% 32.0% 33.0% 33.5%

EBITDA margin 15.1% 13.9% 13.6% 15.5% 16.2%

EBITA margin 13.1% 12.1% 11.8% 13.7% 14.3%

EBIT margin 1.9% 5.0% 9.4% 11.4% 12.1%

EBT margin 0.3% 3.3% 8.0% 10.3% 11.1%


Tax rate 1111.5% 59.3% 35.0% 33.5% 32.0%



Sales -1.3% -2.8% 6.1% 4.0% 4.0%

EBITDA 16.1% -10.3% 3.4% 19.1% 8.5%

EBIT -77.8% >100% >100% 26.2% 10.5%

EBT -96.2% >100% >100% 34.1% 12.6%

Net income (adj.) --- --- >100% 44.5% 16.6%

EPS --- --- >100% 44.5% 16.6%


Key figures



GfK SE – Balance sheet


Fixed assets 1,195 1,231 1,213 1,176 1,139


Intangible assets 1,025 1,039 1,020 980.0 940.0



Current assets 501.9 536.1 561.6 668.5 789.8

Inventories 0.0 0.0 0.0 0.0 0.0



Securities 2.3 0.9 1.0 1.0 1.0

Cash 69.7 93.2 93.6 171.8 262.4

Total assets 1,696 1,767 1,775 1,845 1,929




Minorities 44.6 53.6 53.6 53.6 53.6







Short-term debt 41.0 63.7 65.0 60.0 55.0






GfK SE – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 70.4% 69.7% 68.4% 63.8% 59.1%



Current assets 29.6% 30.3% 31.6% 36.2% 40.9%

Inventories 0.0% 0.0% 0.0% 0.0% 0.0%


Cash 4.1% 5.3% 5.3% 9.3% 13.6%







Short-term debt 2.4% 3.6% 3.7% 3.3% 2.9%





GfK SE – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -54.0 5.9 66.9 96.7 112.8

Depreciation 29.2 26.1 27.0 29.0 31.0



Other 48.1 16.4 0.1 -0.1 0.0








Payments for acquisitions -35.9 -6.5 -20.0 0.0 0.0





Free cash-flow 46.6 98.0 68.3 112.9 127.1




Other financing Cash-flow -18.8 -17.3 -0.3 0.0 0.0

Dividend paid -31.0 -29.7 -29.7 -29.7 -31.5










GfK SE – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -1.48 0.16 1.84 2.66 3.10




Valuation ratios

EV/Sales 1.3 1.1 1.0 0.8 0.7

EV/EBITDA 8.4 8.0 7.0 4.9 4.2

EV/EBIT 65.4 22.5 10.1 6.7 5.6



Dividend yield 1.6% 1.9% 2.1% 2.6% 2.8%


EBITDA margin 15.1% 13.9% 13.6% 15.5% 16.2%

EBIT margin 1.9% 5.0% 9.4% 11.4% 12.1%



Productivity ratios






Financial ratios

Equity ratio 39.1% 39.9% 41.8% 43.9% 46.2%


Net debt / Equity 57.0% 46.6% 39.1% 25.6% 12.5%

Interest cover 0.7 > 10 > 10 > 10 > 10

Net debt / EBITDA 1.68 1.63 1.39 0.83 0.41



WC /sales 18.8% 19.9% 20.1% 20.8% 21.5%






Others



Net income CAGR (last 3 years) -191.0% -57.3% 8.7% -221.4% 168.0%

Pay out ratio -43.8% 403.9% 35.4% 26.4% 24.2%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,266 1,366 1,455 1,524 1,598

EBIT 58.0 57.1 41.5 56.1 72.3

EBIT margin 4.6% 4.2% 2.8% 3.7% 4.5%


Free cash-flow 0.8 23.4 5.7 23.1 36.9

EPS (in EUR) 2.64 3.00 2.13 2.89 4.08

DPS (in EUR) 0.65 0.75 0.65 0.80 0.95

Dividend yield 1.9% 2.3% 2.4% 3.0% 3.6%

EV/Sales 0.5 0.4 0.4 0.3 0.3

EV/EBIT 10.0 10.3 12.8 9.0 6.7



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Christian Ludwig , CFA

Phone: +49 (0)211 4952-126

[email protected]


Grammer AG Expecting turnaround

Following a difficult year in 2015, we expect Grammer to return to earnings growth in

2016. Given the strong order intake in the Automotive business (new orders worth

€ 3.6 bn over three years) and following the successful takeover of the Reum group for

€ 50 m, the long-term prospects are very good, in our view.

INVESTMENT CASE

However, the 2015 results have been disproportionately hit by the weakness in the

Brazilian truck market and in the agricultural machinery sector as well as by higher

start-up costs for many new projects. We expect the EBIT to improve substantially

in 2016 because:

• In 2016, the start-up costs should be less than the ~ € 10 m incurred in 2015

• The restructuring expenses of ~ € 3 m for Brazil were one-off expenses, and

the new start-ups should generate revenue growth worth around € 80 m with

earnings contributions

• The Reum acquisition should contribute about € 140 m in revenue and € 8.5 m

in EBIT before PPA in 2016 (not yet taken account of in model)

The company itself has once again confirmed its guidance of organically generated

revenue worth € 1.55 bn and an EBIT margin of more than 5% for 2017.

CATALYSTS

• Along with the 2015 results due out on 30 March, we expect the company to

issue a guidance for 2016 that will indicate significant growth in earnings.

• The company is aiming to make further acquisitions in the areas of surface

treatment or electronics.

VALUATION

Grammer is trading at an attractive PER2016e of 9.2x. Our price target is based on

33.3% weightings of our DCF, peer-group and cash-flow yield models. Based on

very conservative assumptions (EBIT margin2017 of only 4.5%), this implies an upside

of 20%.

28/01/2016

Buy (Buy )

32.00 EUR (32.00 EUR )

Close 25/01/2016 26.70 EUR

Bloomberg: GMM GY WKN: 589540

Sector Automotive




Compared to SDAX

YTD 6.2%

1 month 3.5%

12 months -33.0%

Share data

EV (m EUR; 2016) 507.8



Free float 97.1%



SWOT


• Numerous new product wins in the Automotive business

• Technology leader for suspension seating systems

• Clear focus on premium OEMs in car industry


• Automotive products are low-margin commodities

• Somewhat dependent on German OEMs

• Chinese activities still weak in the seating segment

• Dependence on agricultural machinery manufacture


• Hartmut Müller (CEO)

• Gérard Cordonnier (CFO)

• Manfred Pretscher

Grammer AG develops and manufactures innovative suspension seating

systems for commercial vehicles. In addition, it supplies seating components

and centre consoles for passenger cars.


• Moderate revenue growth in 2015

• EBIT ~ € 42 m

• 2017 revenue: € 1.55 bn

• EBIT margin of more than 5%



Next event: 30/03/2016 Annual Results Wynnefield 5.17

Electra QMC 5.0

Luxempart 5.0

Dimensional 5.0%



4

6

8

10

12

14

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

66.6%

33.4%Automotive

Seating Systems

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,455 1,524 1,598

Consensus 1,410 1,492 1,573

EBIT (in m EUR)

BHL 41.5 56.1 72.3

Consensus 41.9 57.3 69.7

EPS (EUR)

BHL 2.13 2.89 4.08

Consensus 2.10 2.99 3.93

2013 2014 2015e 2016e 2017e

R&D/Sales --- --- --- --- ---

Capex/Sales 3.4% 3.5% 2.6% 2.8% 2.7%


ROCE 11.5% 10.7% 7.7% 10.2% 12.5%


Equity ratio 29.3% 27.7% 28.8% 30.6% 33.1%

Net debt / Equity 41% 37% 36% 26% 14%

Net debt / EBITDA 1.0 0.9 1.1 0.8 0.4

Interest cover > 10 > 10 > 10 > 10 > 10



Grammer AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,266 1,366 1,455 1,524 1,598

Cost of Sales -1,110 -1,208 -1,302 -1,352 -1,409

Gross profit 156.0 158.3 152.8 172.2 189.4





EBITDA 92.3 93.8 78.0 94.1 111.8

Depreciation 26.8 28.3 29.5 31.0 32.5

EBITA 65.6 65.5 48.5 63.1 79.3



EBIT 58.0 57.1 41.5 56.1 72.3




EBT 42.5 48.4 34.2 46.3 63.5

Taxes -12.8 -14.8 -10.2 -13.9 -17.8




Net income (adj.) 29.6 33.7 23.9 32.4 45.7

No. of shares 11.2 11.2 11.2 11.2 11.2

EPS (in EUR) 2.64 3.00 2.13 2.89 4.08


2013 2014 2015e 2016e 2017e

Gross margin 12.3% 11.6% 10.5% 11.3% 11.9%

EBITDA margin 7.3% 6.9% 5.4% 6.2% 7.0%

EBITA margin 5.2% 4.8% 3.3% 4.1% 5.0%

EBIT margin 4.6% 4.2% 2.8% 3.7% 4.5%

EBT margin 3.4% 3.5% 2.3% 3.0% 4.0%


Tax rate 30.2% 30.5% 30.0% 30.0% 28.0%



Sales 10.7% 7.9% 6.5% 4.8% 4.9%

EBITDA 20.8% 1.6% -16.9% 20.7% 18.8%

EBIT 22.8% -1.7% -27.3% 35.4% 28.8%

EBT 18.0% 14.0% -29.4% 35.6% 37.1%

Net income (adj.) 21.3% 13.6% -28.9% 35.6% 41.0%

EPS 21.0% 13.6% -28.9% 35.6% 41.0%


Key figures



Grammer AG – Balance sheet


Fixed assets 298.4 319.1 320.6 324.6 327.5





Current assets 467.6 517.4 538.6 565.3 607.3

Inventories 115.7 128.3 147.5 154.5 162.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 91.3 84.0 67.3 71.6 89.5

Total assets 766.0 836.5 859.2 890.0 934.8




Minorities 2.5 0.7 0.7 0.7 0.7







Short-term debt 37.7 25.4 25.4 25.4 25.4






Grammer AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 39.0% 38.1% 37.3% 36.5% 35.0%



Current assets 61.0% 61.9% 62.7% 63.5% 65.0%

Inventories 15.1% 15.3% 17.2% 17.4% 17.3%


Cash 11.9% 10.0% 7.8% 8.0% 9.6%







Short-term debt 4.9% 3.0% 3.0% 2.9% 2.7%





Grammer AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 29.6 33.7 23.9 32.4 45.7

Depreciation 26.8 28.3 29.5 31.0 32.5



Other -3.2 15.4 1.6 0.0 0.0


Change in inventory -7.0 -12.0 -19.1 -7.0 -7.5







Financial investments -0.1 0.0 0.0 0.0 0.0




Free cash-flow 0.8 23.4 5.7 23.1 36.9





Dividend paid -5.6 -7.3 -8.4 -7.3 -9.0










Grammer AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.64 3.00 2.13 2.89 4.08




Valuation ratios

EV/Sales 0.5 0.4 0.4 0.3 0.3

EV/EBITDA 6.3 6.3 6.8 5.4 4.3

EV/EBIT 10.0 10.3 12.8 9.0 6.7



Dividend yield 1.9% 2.3% 2.4% 3.0% 3.6%


EBITDA margin 7.3% 6.9% 5.4% 6.2% 7.0%

EBIT margin 4.6% 4.2% 2.8% 3.7% 4.5%



Productivity ratios


Operating leverage 0.1 0.0 -0.2 0.2 0.2




Financial ratios

Equity ratio 29.3% 27.7% 28.8% 30.6% 33.1%


Net debt / Equity 41.5% 37.4% 35.9% 26.2% 13.5%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 1.01 0.92 1.14 0.76 0.37



WC /sales 15.1% 15.1% 15.9% 15.9% 15.9%






Others



Net income CAGR (last 3 years) 22.0% 15.1% -0.7% 3.1% 10.8%

Pay out ratio 24.6% 25.0% 30.5% 27.7% 23.3%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 465.2 472.8 478.0 490.0 504.6

EBIT 22.6 20.1 20.3 26.7 29.1

EBIT margin 4.8% 4.2% 4.2% 5.5% 5.8%

Net financial debt 12.6 12.7 1.8 -11.1 -26.2

Free cash-flow 23.6 14.2 17.6 21.9 24.0

EPS (in EUR) 1.80 1.65 1.44 1.94 2.12

DPS (in EUR) 1.65 1.30 1.00 1.00 1.00

Dividend yield 4.3% 3.1% 2.4% 2.5% 2.5%

EV/Sales 0.8 0.8 0.8 0.7 0.7

EV/EBIT 16.1 19.6 18.8 13.4 11.8



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Hawesko Holding AG Not yet a fresh departure

In our view, Hawesko is still undergoing a transformation. The new CEO joined the

company at the turn of the year. However, we do not expect to see any major

change in strategy that would require us to reassess the stock before mid-April.

INVESTMENT CASE

The revenue target for 2015 (roughly 1% growth) was perceived as ambitious after

nine months (0%). However, if we correctly interpret the news from the retail

sector, it should have been possible for Hawesko to grow by 3% in Q4 and therefore

achieve its own target. We still assume that the proposed EBIT range of € 19 – 20 m

was slightly exceeded (BHLe: € 20 m).

Strategically, Hawesko is still in a transformation process. The new CEO, Thorsten

Hermelink, joined the company at the start of the year. We assume that its key

target will be to move various very independently functioning sales channels – from

procurement through to pricing – closer together in order to achieve traditional

margin-enhancing internal synergy effects. We still believe that Hawesko’s

operations will have to be excellent for it to generate an EBIT margin of 7% in the

medium term (BHLe 2016: 5.5%). We expect Hawesko to present the “new” package

of measures when the 2015 results are released in the latter half of April2016. This

should also include some information about inorganic growth.

CATALYSTS

We regard the preliminary 2015 figures due out on 2 February neutrally. In our view,

investors will focus primarily on the management’s expected action plan.

VALUATION

Our peer group analysis and the EV/sales, EV/EBIT, PER and P/BV valuation

components bring us to our price target of € 37.00. This outcome is backed by our

cash-flow yield model.

28/01/2016

Sell (Sell )

37.00 EUR (37.00 EUR )

Close 25/01/2016 40.34 EUR

Bloomberg: HAW GY WKN: 604270

Sector Consumer





YTD 6.3%

1 month 4.9%

12 months 10.2%

Share data

EV (m EUR; 2016) 358.5



Free float 25.6%



SWOT


• Development of traditional sales channels facilitating growth

• Consistent multi-channel strategy

• Further acquisitions are to contribute to value faster

• Expansion of corporate growth is improving position

• Trend towards higher quality wines is a mainstay of the business model


• Strong dependency on the Christmas period

• Repeated investments in quality of service necessary

• Fragmented market with price squeeze


• Thorsten Hermelink (CEO)

• Ulrich Zimmermann (CFO)

• Alexander Borwitzky (Member of the Board)

• Bernd G. Siebdrat (Member of the Board)

• Nikolas von Haugwitz (Member of the Board)

Hawesko Holding AG is Germany’s largest integrated merchant for premium

wines and champagnes. It operates through three business segments:

Hanseatisches Wein- und Sekt-Kontor, a wine mail-order and online

business, Jacques’ Wein-Depot, a specialist wine retailer, and Wein Wolf and

CWD Champagner und Wein Distributionsgesellschaft, which are wine

wholesalers. Hawesko Holding was founded in 1964 and is headquartered in

Hamburg, Germany.


• 2015: Revenue growth of ~ 1%

• 2015: EBIT (not adj.) € 19-20 m

• 2015: EBIT (adj.) € 26-27 m

• -



Next event: 02/02/2016 Preliminary Results Detlev Meyer 74.4

Michael Schiemann 5.6



12

14

16

18

20

22

2009 2010 2011 2012 2013PER AVG STD + 1 STD - 1

39.6%

32.1%

28.3% Wholesale

Mail Order

Retail

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 478.0 490.0 504.6

Consensus 476.1 490.5 506.0

EBIT (in m EUR)

BHL 20.3 26.7 29.1

Consensus 19.8 28.7 30.2

EPS (EUR) BHL 1.44 1.94 2.12

Consensus 1.42 2.09 2.20

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 1.1% 1.1% 1.5% 1.4% 1.3%


ROCE 18.1% 17.3% 16.4% 20.3% 20.5%


Equity ratio 39.3% 41.9% 39.0% 40.4% 42.1%

Net debt / Equity 14% 14% 2% -11% -24% Net debt / EBITDA 0.4 0.5 0.1 -0.3 -0.7

Interest cover 0.0 0.0 0.0 0.0 0.0



Hawesko Holding AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 465.2 472.8 478.0 490.0 504.6


Total sales 465.2 473.5 478.0 490.0 504.6





EBITDA 29.4 26.9 27.3 33.9 36.5

Depreciation 6.8 6.8 7.0 7.2 7.4

EBITA 22.6 20.1 20.3 26.7 29.1



EBIT 22.6 20.1 20.3 26.7 29.1

Financial result 2.7 1.3 -0.8 -0.8 -0.8



EBT 25.3 21.4 19.5 25.9 28.3

Taxes -9.0 -6.5 -6.0 -8.0 -8.8




Net income (adj.) 16.2 14.8 12.9 17.4 19.0

No. of shares 9.0 9.0 9.0 9.0 9.0

EPS 1.80 1.65 1.44 1.94 2.12


2013 2014 2015e 2016e 2017e

Gross margin 40.9% 41.9% 41.9% 41.9% 41.9%

EBITDA margin 6.3% 5.7% 5.7% 6.9% 7.2%

EBITA margin 4.8% 4.2% 4.2% 5.5% 5.8%

EBIT margin 4.8% 4.2% 4.2% 5.5% 5.8%

EBT margin 5.4% 4.5% 4.1% 5.3% 5.6%


Tax rate 35.4% 30.6% 31.0% 31.0% 31.0%



Sales 3.7% 1.6% 1.1% 2.5% 3.0%

EBITDA -11.9% -8.5% 1.3% 24.5% 7.4%

EBIT -13.7% -11.1% 1.0% 32.0% 8.7%

EBT -16.6% -15.5% -8.9% 33.3% 9.0%

Net income (adj.) -28.1% -8.5% -12.9% 34.6% 9.2%

EPS -28.1% -8.5% -12.9% 34.6% 9.2%


Key figures



Hawesko Holding AG – Balance sheet


Fixed assets 64.7 60.3 60.5 60.0 59.0





Current assets 169.5 156.9 176.2 189.1 204.2

Inventories 95.8 95.4 96.0 96.0 96.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 18.8 10.9 28.2 41.1 56.2

Total assets 234.3 217.2 236.7 249.2 263.2




Minorities 7.4 6.5 6.5 6.5 6.5







Short-term debt 21.2 19.9 20.0 20.0 20.0






Hawesko Holding AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 27.6% 27.8% 25.6% 24.1% 22.4%



Current assets 72.4% 72.2% 74.4% 75.9% 77.6%

Inventories 40.9% 43.9% 40.5% 38.5% 36.5%


Cash 8.0% 5.0% 11.9% 16.5% 21.3%







Short-term debt 9.0% 9.2% 8.4% 8.0% 7.6%





Hawesko Holding AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 16.2 14.8 12.9 17.4 19.0

Depreciation 6.8 6.8 7.0 7.2 7.4


Change of provisions 1.0 -0.1 -0.1 0.0 0.0

Other -5.9 -1.5 0.0 0.0 0.0


Change in inventory 3.8 0.4 -0.6 0.0 0.0

Change in accounts receivable 3.6 4.0 -0.5 0.0 0.0










Free cash-flow 23.6 14.2 17.6 21.9 24.0


Increase/decrease in debt position 0.3 -4.9 6.4 0.0 0.0



Dividend paid -14.8 -14.8 -11.7 -9.0 -9.0










Hawesko Holding AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 1.80 1.65 1.44 1.94 2.12




Valuation ratios

EV/Sales 0.8 0.8 0.8 0.7 0.7

EV/EBITDA 12.4 14.6 14.0 10.6 9.4

EV/EBIT 16.1 19.6 18.8 13.4 11.8



Dividend yield 4.3% 3.1% 2.4% 2.5% 2.5%


EBITDA margin 6.3% 5.7% 5.7% 6.9% 7.2%

EBIT margin 4.8% 4.2% 4.2% 5.5% 5.8%



Productivity ratios






Financial ratios

Equity ratio 39.3% 41.9% 39.0% 40.4% 42.1%

Net financial debt (in m EUR) 12.6 12.7 1.8 -11.1 -26.2

Net debt / Equity 13.7% 14.0% 1.9% -11.0% -23.6%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 0.43 0.47 0.07 -0.33 -0.72


Change Working Capital (in m EUR) -10.3 -2.4 -5.1 -2.0 -2.0

WC /sales 16.5% 15.7% 14.4% 13.7% 12.9%






Others



Net income CAGR (last 3 years) -6.7% -6.0% -16.9% 2.4% 8.6%

Pay out ratio 91.4% 78.7% 69.5% 51.6% 47.3%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,100 1,100 1,066 1,145 1,174

EBIT -130.7 14.1 31.0 56.0 58.1

EBIT margin -11.9% 1.3% 2.9% 4.9% 4.9%


Free cash-flow 3.2 28.7 -7.3 29.1 34.6

EPS (in EUR) -9.30 0.03 1.29 2.57 2.68

DPS (in EUR) 0.00 0.00 0.00 0.51 0.54

Dividend yield 0.0% 0.0% 0.0% 1.7% 1.8%

EV/Sales 0.2 0.1 0.5 0.4 0.4

EV/EBIT -1.5 11.3 17.2 8.2 7.5



Next event


Change in model

Sales EBIT EPS

2015e -1.7% -11.4% -13.8%

2016e -1.0% -1.8% -2.1%

2017e 4.1% 7.6% 8.6%

Analyst


Phone: +49 (0)211 4952-455

[email protected]


Koenig & Bauer AG A lot of praise in advance

Supported by cost-cutting measures and increasing revenues, we expect to see

further improvements of the earnings situation. With regard to the consensus, KBA

has received a considerable portion of advanced praise, especially when we keep in

mind the recent deterioration of the economic environment. .

INVESTMENT CASE

Due to a significant reduction of the fixed-cost basis and rising revenues, we expect

the operating earnings to improve further in 2016 and 2017. The better fixed-cost

basis is only partially visible in the 2015 results. In terms of revenue, we also expect

contributions from the new digital printing press (cooperation with HP) for

corrugated printing. We project the sheet-fed printing business will conclude the

year with a book-to-bill ratio of 1x, which should enable further revenue growth in

2016. We also see further potential for earnings improvements in the smaller

business units including metal, flexo and glass printing. We regard the very volatile

security printing business as a factor of uncertainty. However, the segment’s order

book is solid according to statements from the management team.

CATALYSTS

• As the consensus is already optimistic, we see only a marginal potential for

positive surprises from the release of the 2015 results and the 2016 guidance.

• The drupa trade fair should boost the order intake and bring the company broad

and positive media coverage.

• KBA has a strong balance sheet. Acquisitions are conceivable.

VALUATION

As we have become a little more cautious about the results for 2015 and 2016

(Q3 was below our expectations), we stick to our HOLD rating.

28/01/2016

Hold (Hold )

29.00 EUR (29.00 EUR )

Close 25/01/2016 30.30 EUR

Bloomberg: SKB GY WKN: 719350

Sector Engineering




Compared to SDAX

YTD 0.6%

1 month -0.7%

12 months 149.3%

Share data

EV (m EUR; 2016) 461.4



Free float 84.7%



SWOT


• Strong market position in special presses (high margin)

• Packaging market is growing continuously

• High-quality digital presses

• Restructuring programme has more potential to improve revenue

• Strong finances leave room for acquisitions in attractive areas


• Exposure to newspaper printing (unattractive market)

• Further shrinkage of market volume

• Special presses subject to high volatility


• Claus Bolza-Schünemann (CEO)

• Dr. Mathias Dähn (CFO)

• Michael Kummert

• Christoph Müller

• Dr. Andreas Pleßke (CRO)

K&B is the world’s second largest maker of printing presses and offers the

largest range of products that cover sheetfed offset presses (all formats),

web offset presses and special presses for metal decoration and securities

printing, coding systems as well as its own digital printing press. The

company enjoys market shares of up to 90% in the security and metal

decoration niches. K&B is #1 globally in packaging offset printing and large-

format sheetfed offset printing and #2 in sheetfed offset.


• 2015 revenue: over € 1.0 bn

• 2015 EBT: up to 2%

• Much-improved operating results



Next event: 24/03/2016 Annual Results Family 25.0

Bestinver 12.8

MKB Holding 10.2



5

25

45

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

53.7%46.3%

Sheetfed Offset Presses

Web & Special Presses

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,066 1,145 1,174

Consensus 1,080 1,120 1,134

EBIT (in m EUR)

BHL 31.0 56.0 58.1

Consensus 33.5 53.0 59.5

EPS (EUR) BHL 1.29 2.57 2.68

Consensus 1.37 2.19 2.68

2013 2014 2015e 2016e 2017e

R&D/Sales 5.8% 5.0% 5.4% 5.1% 4.9%

Capex/Sales 2.2% 1.7% 1.7% 1.9% 1.9%


ROCE -29.6% 3.2% 6.8% 11.2% 10.8%


Equity ratio 25.3% 22.4% 26.7% 29.4% 31.9%

Net debt / Equity -59% -89% -75% -74% -74% Net debt / EBITDA 2.3 -4.7 -3.2 -2.6 -2.9

Interest cover < -10 > 10 0.0 0.0 0.0



Koenig & Bauer AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,100 1,100 1,066 1,145 1,174

Cost of Sales -941.1 -802.9 -792.9 -828.0 -848.1

Gross profit 158.6 297.2 273.0 317.4 326.2




Other operating result -12.0 -13.0 16.0 -5.4 -5.6

EBITDA -71.1 42.7 60.5 85.5 87.6

Depreciation 59.6 28.6 29.5 29.5 29.5

EBITA -130.7 14.1 31.0 56.0 58.1



EBIT -130.7 14.1 31.0 56.0 58.1


Income on ordinary activities -138.1 5.5 25.0 50.0 52.1


EBT -138.1 5.5 25.0 50.0 52.1

Taxes -15.6 -5.2 -3.8 -7.5 -7.8




Net income (adj.) -153.7 0.5 21.3 42.5 44.3

No. of shares 16.5 16.5 16.5 16.5 16.5

EPS (in EUR) -9.30 0.03 1.29 2.57 2.68


2013 2014 2015e 2016e 2017e

Gross margin 14.4% 27.0% 25.6% 27.7% 27.8%

EBITDA margin -6.5% 3.9% 5.7% 7.5% 7.5%

EBITA margin -11.9% 1.3% 2.9% 4.9% 4.9%

EBIT margin -11.9% 1.3% 2.9% 4.9% 4.9%

EBT margin -12.6% 0.5% 2.3% 4.4% 4.4%


Tax rate -11.3% 94.5% 15.0% 15.0% 15.0%



Sales -15.0% 0.0% -3.1% 7.4% 2.5%

EBITDA --- --- 41.7% 41.2% 2.5%

EBIT --- --- >100% 80.4% 3.8%

EBT --- --- >100% 99.7% 4.3%

Net income (adj.) --- --- >100% 99.7% 4.3%

EPS --- --- >100% 99.7% 4.3%


Key figures



Koenig & Bauer AG – Balance sheet


Fixed assets 272.1 278.8 267.3 259.8 252.3





Current assets 825.9 735.9 702.9 766.3 805.0

Inventories 357.2 279.3 260.0 279.4 286.4



Securities 0.9 9.6 9.6 9.6 9.6

Cash 185.4 207.6 200.3 229.4 255.5

Total assets 1,098 1,015 970.2 1,026 1,057




Minorities 0.8 0.5 0.5 0.5 0.5







Short-term debt 21.5 15.2 15.2 15.2 15.2




Total equity and liabilities 1,098 1,015 970.2 1,026 1,057


Koenig & Bauer AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 24.8% 27.5% 27.6% 25.3% 23.9%



Current assets 75.2% 72.5% 72.4% 74.7% 76.1%

Inventories 32.5% 27.5% 26.8% 27.2% 27.1%


Cash 16.9% 20.5% 20.6% 22.4% 24.2%







Short-term debt 2.0% 1.5% 1.6% 1.5% 1.4%





Koenig & Bauer AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -153.7 0.5 21.3 42.5 44.3

Depreciation 59.6 28.6 29.5 29.5 29.5


Change of provisions 119.0 -38.8 -60.0 0.0 0.0

Other 34.7 -11.4 0.0 0.0 0.0

Operating Cash-flow before changes in w/c 59.6 -21.1 -9.2 72.0 73.8

Change in inventory -10.2 72.6 19.3 -19.4 -7.1

Change in accounts receivable 32.3 32.9 6.5 -15.0 -5.5

Change in accounts payable -32.0 -66.5 -5.8 13.5 -4.6









Free cash-flow 3.2 28.7 -7.3 29.1 34.6





Dividend paid -6.6 0.0 0.0 0.0 -8.5

Cash-flow from financing activities -22.4 -6.5 0.0 0.0 -8.5

Increase/ decrease in liquid assets -19.2 22.2 -7.3 29.1 26.1



Change in total cash and cash equivalents -20.9 22.2 -7.3 29.1 26.1





Koenig & Bauer AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -9.30 0.03 1.29 2.57 2.68




Valuation ratios

EV/Sales 0.2 0.1 0.5 0.4 0.4

EV/EBITDA -2.7 3.7 8.8 5.4 5.0

EV/EBIT -1.5 11.3 17.2 8.2 7.5



Dividend yield 0.0% 0.0% 0.0% 1.7% 1.8%


EBITDA margin -6.5% 3.9% 5.7% 7.5% 7.5%

EBIT margin -11.9% 1.3% 2.9% 4.9% 4.9%


Return on capital employed (ROCE) -29.6% 3.2% 6.8% 11.2% 10.8%

Productivity ratios


Operating leverage 9.2 1.1 -1.2 -0.8 0.0


EBIT per employee 0 2,317 6,064 12,434 12,907


Financial ratios

Equity ratio 25.3% 22.4% 26.7% 29.4% 31.9%


Net debt / Equity -59.3% -88.9% -75.0% -74.1% -74.0%

Interest cover < -10 > 10 0.0 0.0 0.0

Net debt / EBITDA 2.32 -4.73 -3.22 -2.62 -2.85


Change Working Capital (in m EUR) -19.5 -50.7 -20.0 20.9 17.1

WC /sales 32.0% 27.3% 26.3% 26.3% 27.2%






Others


EBIT CAGR (last 3 years) -280.6% 12.5% 24.7% -175.4% 60.3%

Net income CAGR (last 3 years) -330.8% 7.7% 109.9% -165.1% 345.7%

Pay out ratio 0.0% 0.0% 0.0% 20.0% 20.0%

Free cash-flow (in m EUR) 3.2 28.7 -7.3 29.1 34.6





in m EUR 2013 2014 2015e 2016e 2017e

Sales 220.9 220.7 231.0 240.0 250.0

EBIT 14.9 21.5 20.5 21.5 22.2

EBIT margin 6.8% 9.8% 8.9% 9.0% 8.9%


Free cash-flow 23.4 15.4 8.7 9.3 10.3

EPS (in EUR) 2.16 2.97 2.86 3.01 3.11

DPS (in EUR) 1.65 1.80 1.95 2.10 2.25

Dividend yield 5.3% 3.9% 3.9% 4.6% 4.9%

EV/Sales 0.7 1.0 1.1 0.9 0.9

EV/EBIT 10.2 10.7 11.9 10.6 10.2



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Leifheit AG Strong dividends

Growth of the brand business, a solid balance sheet and strong dividends are the

key arguments for this stock. We therefore reiterate our BUY rating with an

unchanged price target of € 60.00.

INVESTMENT CASE

In the first nine months of 2015, the company delivered a better-than-expected

performance. We are confident that Leifheit is going to report a positive business

trend in Q4 too. In our view, these are the first positive results of the strategy

“Leifheit 2020” launched a good year ago.

• Positioning of Leifheit as an expert in easy and effortless cleaning and care in

the home with an integrated category approach.

• As a consequence, the business model in the Kitchen segment will be revised.

Leifheit is considering sensible acquisitions. However, we do not expect any

significant newsflow in the short term.

For 2016, the further implementation of the strategy remains at the top of Leifheit’s

agenda, in our view. We expect the company to maintain its clear focus on the

consumer, to reinforce its innovative strength and to significantly enhance its

Soehnle brand by positioning it closer to the brand essence. We are therefore

optimistic about 2016 and expect many new products and innovations at the

leading international Ambiente trade fair in Frankfurt in February.

CATALYSTS

Leifheit is set to publish preliminary figures for 2015 during the Ambiente fair,

which should be well received by the market.

VALUATION

Our valuation is based on a DCF model and a cash-flow-yield model to which we

have assigned an equal weighting. Even though the share is too expensive

considering the traditional multiples (EV/EBIT, PER), the dividend (current yield

~4%) and the expectation of higher pay-outs make the share attractive.

28/01/2016

Buy (Buy )

60.00 EUR (60.00 EUR )

Close 25/01/2016 46.13 EUR

Bloomberg: LEI GY WKN: 646450

Sector Consumer





YTD 2.2%

1 month 3.4%

12 months 8.6%

Share data

EV (m EUR; 2016) 227.6



Free float 76.6%



SWOT


• Leading positions in Germany and many European markets

• Non-cyclical business with brands for everyday consumer goods

• Dividend expected to increase in the upcoming years

• Healthy balance sheet with € 60 m in cash enables for M&A without

dilution


• Expansion of international distribution activities necessary

• Reassessment for Kitchen segment necessary

• Soehnlerequires a new positioning


• Thomas Radke (CEO)

• Dr. Claus-Otto Zacharias (CFO)

Leifheit AG is one of Europe’s leading producers of household products. Its

product portfolio offers cleaning, laundry care and kitchen products as well

as wellbeing. Apart from Leifheit, the company’s brands also include

Soehnle, Birambeau and Herby. The group employs some 1,000 people

mostly in Germany, the Czech Republic, and in France. It was founded in

1959 and is headquartered in Nassau, Germany.


• 2015: Consolidated sales growth of 4%

• 2015: EBIT at least € 20 m

• Until 2020: organic growth of 5 - 6% per year

• Until 2020 external growth through M&A

• Target EBIT margin of 8%



Next event: 11/02/2016 Preliminary Results Manuel Knapp Voith 10.0

Joachim Loh 8.3

Carmignac Gestion Luxemburg 6.0



5

15

25

35

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

81.7%

18.3%

Brand business

Volume business

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 231.0 240.0 250.0

Consensus 230.5 238.0 248.0

EBIT (in m EUR)

BHL 20.5 21.5 22.2

Consensus 20.3 20.8 21.6

EPS (EUR) BHL 2.86 3.01 3.11

Consensus 2.84 2.88 2.98

2013 2014 2015e 2016e 2017e

R&D/Sales 1.8% 1.7% 1.6% 1.7% 1.6%

Capex/Sales 1.6% 2.8% 3.2% 3.2% 3.2%


ROCE 9.9% 13.1% 12.1% 12.3% 12.4%


Equity ratio 46.5% 42.5% 42.5% 43.5% 44.7%

Net debt / Equity -54% -62% -61% -58% -55% Net debt / EBITDA -2.3 -2.1 -2.2 -2.1 -2.1

Interest cover > 10 > 10 0.0 0.0 0.0



Leifheit AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 220.9 220.7 231.0 240.0 250.0

Cost of Sales -121.7 -115.4 -121.0 -127.2 -138.0

Gross profit 99.2 105.2 110.0 112.8 112.0




Other operating result -1.4 6.2 1.8 0.3 5.2

EBITDA 21.7 27.8 27.0 28.2 29.1

Depreciation 6.8 6.3 6.5 6.7 6.9

EBITA 14.9 21.5 20.5 21.5 22.2



EBIT 14.9 21.5 20.5 21.5 22.2




EBT 13.3 19.8 19.1 20.1 20.8

Taxes -3.1 -5.7 -5.5 -5.8 -6.0




Net income (adj.) 10.2 14.1 13.6 14.3 14.8

No. of shares 4.7 4.7 4.7 4.7 4.7

EPS (in EUR) 2.16 2.97 2.86 3.01 3.11


2013 2014 2015e 2016e 2017e

Gross margin 44.9% 47.7% 47.6% 47.0% 44.8%

EBITDA margin 9.8% 12.6% 11.7% 11.8% 11.6%

EBITA margin 6.8% 9.8% 8.9% 9.0% 8.9%

EBIT margin 6.8% 9.8% 8.9% 9.0% 8.9%

EBT margin 6.0% 9.0% 8.3% 8.4% 8.3%


Tax rate 23.1% 28.7% 29.0% 29.0% 29.0%



Sales -1.5% -0.1% 4.7% 3.9% 4.2%

EBITDA 4.4% 27.8% -2.9% 4.5% 3.2%

EBIT 5.3% 44.3% -4.9% 4.9% 3.3%

EBT 9.2% 48.7% -3.4% 5.3% 3.5%

Net income (adj.) 9.4% 37.7% -3.8% 5.3% 3.5%

EPS 9.4% 37.7% -3.8% 5.3% 3.5%


Key figures



Leifheit AG – Balance sheet


Fixed assets 66.5 68.6 69.5 70.5 71.5





Current assets 137.2 154.7 165.4 170.5 173.8

Inventories 33.6 35.4 43.0 47.0 49.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 51.0 58.8 61.4 61.5 61.8

Total assets 203.8 223.3 234.9 241.0 245.3




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 0.0 0.0 1.0 1.0 1.0






Leifheit AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 32.6% 30.7% 29.6% 29.3% 29.2%



Current assets 67.4% 69.3% 70.4% 70.7% 70.8%

Inventories 16.5% 15.9% 18.3% 19.5% 20.0%


Cash 25.0% 26.3% 26.1% 25.5% 25.2%







Short-term debt 0.0% 0.0% 0.4% 0.4% 0.4%





Leifheit AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 10.2 14.1 13.6 14.3 14.8

Depreciation 6.8 6.3 6.5 6.7 6.9


Change of provisions 13.6 12.3 1.0 0.0 -1.5

Other -17.0 -5.4 0.0 0.0 0.0












Cash-flow from investing activities 0.5 -9.1 -7.4 -7.7 -7.9

Free cash-flow 23.4 15.4 8.7 9.3 10.3





Dividend paid -7.1 -7.8 -8.5 -9.3 -10.0










Leifheit AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.16 2.97 2.86 3.01 3.11




Valuation ratios

EV/Sales 0.7 1.0 1.1 0.9 0.9

EV/EBITDA 7.0 8.3 9.0 8.1 7.8

EV/EBIT 10.2 10.7 11.9 10.6 10.2



Dividend yield 5.3% 3.9% 3.9% 4.6% 4.9%


EBITDA margin 9.8% 12.6% 11.7% 11.8% 11.6%

EBIT margin 6.8% 9.8% 8.9% 9.0% 8.9%



Productivity ratios






Financial ratios

Equity ratio 46.5% 42.5% 42.5% 43.5% 44.7%


Net debt / Equity -53.8% -62.0% -60.5% -57.6% -55.4%

Interest cover > 10 > 10 0.0 0.0 0.0

Net debt / EBITDA -2.34 -2.12 -2.24 -2.14 -2.09



WC /sales 19.0% 18.2% 20.3% 21.3% 21.2%






Others

Sales CAGR (last 3 years) 1.5% -0.2% 1.0% 2.8% 4.2%



Pay out ratio 76.5% 60.6% 68.2% 69.8% 72.2%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 129.7 119.7 87.0 105.0 114.0

EBIT 23.2 12.7 -6.9 5.2 10.8

EBIT margin 17.9% 10.6% -7.9% 5.0% 9.5%


Free cash-flow 16.5 -13.2 1.6 -2.3 3.0

EPS (in EUR) 0.68 0.38 -0.38 0.13 0.31

DPS (in EUR) 0.28 0.16 0.00 0.05 0.12

Dividend yield 1.5% 1.4% 0.0% 0.8% 1.8%

EV/Sales 3.3 2.3 2.2 1.8 1.6

EV/EBIT 18.3 21.4 -27.6 35.7 17.3



Next event


Change in model

Sales EBIT EPS

2015e -13.0% -668.5% 2658.4%

2016e -7.1% -48.8% -53.9%

2017e -5.8% -30.5% -32.5%

Analyst


Phone: +49 (0)211 4952-351

[email protected]


LPKF Laser & Electronics AG Return to go

The last cycle was dominated exclusively by the Laser Direct Structuring business

(LDS). Now that expectations for this business have fallen to a minimum, we are

pinning our hopes on moderate growth, driven by new products, the Plastic Welding

segment and the Solar business.

INVESTMENT CASE

Just as indicated after the Q3 results, we have once more lowered our estimates for

LPKF. As our current estimates include no more than a negligible contribution from

the LDS business, we see no further downside risk to our estimates. We believe the

management has shown sufficient caution in its guidance for 2016. Our estimates

may even offer upside potential, providing that the new products get off to a

successful start on the market, or the desired solar order materialises. Nevertheless,

following a series of profit warnings, the management will first have to restore

investor confidence.

CATALYSTS

• LPKF’s management will hold a presentation at our “German Equity Forum”

conference in London on 4 February.

• We still see a good chance of a decent solar order emerging in the next few

months as the company’s largest solar customer has plans for a technology

upgrade.

• We expect the new products to generate first orders in the first half of 2016.

VALUATION

Our DCF-based price target follows our adjusted estimates and has fallen from

€ 9.00 to € 8.50. The latest reduction in costs leads us to a normalised EPS estimate

of € 0.50 (based on revenue of some € 120 m). Although visibility remains low in

this respect, the valuation certainly looks attractive.

26/01/2016

Buy (Buy )

8.50 EUR (9.00 EUR )

Close 25/01/2016 6.93 EUR

Bloomberg: LPK GR WKN: 645000

Sector Technology




Compared to TecDAX

YTD 4.0%

1 month 1.4%

12 months -46.5%

Share data

EV (m EUR; 2016) 186.6



Free float 100.0%



SWOT


• Excellent track record

• Clear and focused business model

• Diversified customer base (no individual customer exceeds 10%)

• Penetration of LDS antennas in smartphones still increasing

• New applications for laser equipment (outside the electronics industry)


• High working capital reduces FCF potential

• Cyclical PCB market

• Increasing number of LDS patent infringements


• Dr. Ingo Bretthauer (CEO)

• Kai Bentz (CFO)

• Bernd Lange (CTO)

• Dr. Christian Bieniek (COO)

LPKF manufactures machinery and laser systems. Its products are mainly used in electronics (PCBs) and increasingly in the automotive and medical technology sectors. The company has grown steadily since 2003, even during crises such as in 2009 (16% p.a. on average). Laser production systems for high-tech antennas for smartphones/tablets (LDS, Laser Direct Structuring) have mainly driven its growth in recent years. LPKF holds major patents for this technology. Plastic welding for the automotive and medical technology sectors has also driven growth recently.


• Revenue € 132 - 140 m in 2015

• EBIT margin of 12-15% in 2015

• 10% revenue growth p.a.

• EBIT margin of 15-17%



Next event: Annual Results 23/03/16 Deutsche Asset & Wealth Management 4.7

Wasatch Advisors 3.1

Rock Point Advisors 3.0


Source: Company information, FactSet, BHL estimates manz

5

15

25

35

45

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

42.8%

35.8%

20.9%0.5%

Electronics Production

other Equipment

Electronics Development

other

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 87.0 105.0 114.0

Consensus 88.9 107.0 118.8

EBIT (in m EUR) BHL -6.9 5.2 10.8

Consensus -5.5 6.1 14.3

EPS (EUR) BHL -0.38 0.13 0.31

Consensus -0.21 0.17 0.41

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 13.6% 8.2% 9.2% 8.6% 8.8%


ROCE 26.4% 12.1% -7.0% 5.2% 10.4% Free cash flow yield 9.6% -6.8% 0.8% -1.2% 1.5%

Equity ratio 56.6% 53.5% 51.1% 51.5% 52.6%

Net debt / Equity 18% 44% 47% 51% 47% Net debt / EBITDA 0.4 1.5 190.4 2.4 1.6

Interest cover 0.0 0.0 < -10 > 10 0.0



LPKF Laser & Electronics AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 129.7 119.7 87.0 105.0 114.0


Total sales 134.5 126.5 93.0 111.0 120.0





EBITDA 31.0 20.6 0.2 13.2 19.8

Depreciation 7.8 7.9 7.0 8.0 9.0

EBITA 23.2 12.7 -6.9 5.2 10.8



EBIT 23.2 12.7 -6.9 5.2 10.8


Income on ordinary activities 22.5 11.9 -7.6 4.5 10.1


EBT 22.5 11.9 -7.6 4.5 10.1

Taxes -6.8 -3.4 0.0 -1.4 -3.0

Net income from cont. operations 15.7 8.5 -7.6 3.2 7.1



Net income (adj.) 15.1 8.5 -8.4 3.0 6.9

No. of shares 22.3 22.3 22.3 22.3 22.3

EPS 0.68 0.38 -0.38 0.13 0.31


2013 2014 2015e 2016e 2017e

Gross margin 73.1% 68.2% 70.9% 70.7% 70.9%

EBITDA margin 23.9% 17.2% 0.2% 12.6% 17.4%

EBITA margin 17.9% 10.6% -7.9% 5.0% 9.5%

EBIT margin 17.9% 10.6% -7.9% 5.0% 9.5%

EBT margin 17.4% 10.0% -8.7% 4.3% 8.9%

Net profit margin 11.6% 7.1% -9.6% 2.8% 6.1%

Tax rate 30.1% 28.6% 0.0% 30.0% 30.0%



Sales 12.7% -7.6% -27.3% 20.7% 8.6%

EBITDA 12.6% -33.7% -99.3% >100% 49.7%

EBIT 14.1% -45.5% --- --- >100%

EBT 15.1% -47.1% --- --- >100%

Net income (adj.) 11.4% -43.5% --- --- >100%

EPS 11.4% -43.5% --- --- >100%


Key figures



LPKF Laser & Electronics AG – Balance sheet


Fixed assets 53.2 60.3 64.3 67.3 70.3





Current assets 60.0 67.9 55.1 54.9 57.5

Inventories 31.2 32.2 26.6 29.2 31.7



Securities 0.0 0.0 0.0 0.0 0.0

Cash 12.6 6.0 7.7 4.2 4.4

Total assets 113.2 128.2 119.5 122.2 127.8




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 5.9 20.1 20.1 20.1 20.1






LPKF Laser & Electronics AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 47.0% 47.0% 53.8% 55.1% 55.0%



Current assets 53.0% 53.0% 46.2% 44.9% 45.0%

Inventories 27.6% 25.1% 22.3% 23.9% 24.8%


Cash 11.1% 4.7% 6.4% 3.5% 3.5%







Short-term debt 5.2% 15.7% 16.8% 16.5% 15.7%





LPKF Laser & Electronics AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 15.1 8.5 -8.4 3.0 6.9

Depreciation 7.8 7.9 7.0 8.0 9.0



Other 0.0 0.0 0.0 0.0 0.0

Operating Cash-flow before changes in w/c 26.2 12.9 -1.4 11.0 15.9

Change in inventory 1.7 -1.0 5.7 -2.6 -2.5

Change in accounts receivable 7.6 -13.4 8.7 -0.6 0.1

Change in accounts payable -1.5 0.5 -1.2 0.8 1.3





Financial investments -0.1 -5.2 -3.0 -2.0 -2.0




Free cash-flow 16.5 -13.2 1.6 -2.3 3.0




Other financing Cash-flow -5.7 -9.7 3.5 -1.2 -1.6

Dividend paid -5.6 -6.2 -3.5 0.0 -1.2

Cash-flow from financing activities -5.6 -3.5 0.0 -1.2 -2.8

Increase/ decrease in liquid assets 10.9 -16.7 1.6 -3.4 0.2

Effects of exchange rate changes -0.1 -0.1 0.0 0.0 0.0


Change in total cash and cash equivalents 10.9 -16.7 1.6 -3.4 0.2

Cash at end of period 15.9 -4.2 7.7 4.2 4.4




LPKF Laser & Electronics AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.68 0.38 -0.38 0.13 0.31


Free Cash-flow per share 0.74 -0.59 0.07 -0.10 0.13


Valuation ratios

EV/Sales 3.3 2.3 2.2 1.8 1.6

EV/EBITDA 13.7 13.2 1,261.2 14.0 9.3

EV/EBIT 18.3 21.4 -27.6 35.4 17.1



Dividend yield 1.5% 1.4% 0.0% 0.8% 1.8%


EBITDA margin 23.9% 17.2% 0.2% 12.6% 17.4%

EBIT margin 17.9% 10.6% -7.9% 5.0% 9.5%

Net return on sales 11.6% 7.1% -9.6% 2.8% 6.1%

Return on capital employed (ROCE) 26.4% 12.1% -7.0% 5.2% 10.4%

Productivity ratios


Operating leverage -0.1 0.5 1.5 1.8 -1.1

Sales per employee 172,424 150,628 0 0 0

EBIT per employee 30,906 15,941 0 0 0


Financial ratios

Equity ratio 56.6% 53.5% 51.1% 51.5% 52.6%


Net debt / Equity 17.6% 44.1% 46.8% 50.8% 47.3%

Interest cover 0.0 0.0 < -10 > 10 0.0

Net debt / EBITDA 0.36 1.47 190.40 2.42 1.61


Change Working Capital (in m EUR) -7.7 14.0 -13.2 2.4 1.1

WC /sales 33.2% 47.6% 50.4% 44.1% 41.5%






Others


EBIT CAGR (last 3 years) 10.3% -6.0% -169.5% -39.2% -5.2%

Net income CAGR (last 3 years) 7.5% -5.0% -185.2% -41.7% -6.7%

Pay out ratio 41.0% 41.0% 0.0% 40.0% 40.0%

Free cash-flow (in m EUR) 16.5 -13.2 1.6 -2.3 3.0

Free cash flow yield 4.0% -5.5% 1.0% -1.5% 1.9%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 266.2 305.9 205.0 240.0 270.0

EBIT 3.1 -32.8 -47.2 1.2 13.7

EBIT margin 1.2% -10.7% -23.0% 0.5% 5.1%


Free cash-flow 15.2 -1.7 -33.6 -10.2 2.0

EPS (in EUR) -0.68 -7.75 -9.27 0.03 1.76

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 1.1 1.0 1.2 0.9 0.8

EV/EBIT 92.9 -9.0 -5.0 186.6 16.2

Price Earnings ratio (P/E) -90.7 -7.2 -3.7 1,082.5 17.0


Next event


Change in model

Sales EBIT EPS

2015e -4.7% 57.7% 52.3%

2016e -11.1% -84.2% -97.0%

2017e -12.9% -39.4% -41.2%

Analyst


Phone: +49 (0)211 4952-351

[email protected]


Manz AG Seeking investor confidence

Following an extremely difficult 2015, we believe the company is likely to focus on

returning to profitability and restoring investor confidence in 2016. In our view,

answering the still-unresolved solar issue will play a critical role in this.

INVESTMENT CASE

The company has announced the first restructuring measures. Together with the

expected solution to the solar problem, this should permit the company to return to

breakeven in 2016. This year, the main growth driver is likely to be the battery

business in particular. This area enjoys the greatest visibility regarding sustainable

growth right now. Given the ongoing weakness in the Apple supply chain, we have

lowered our estimates once again. In our view, the share price already reflects this.

CATALYSTS

• The company is seeking a solution for the Solar business to prevent it from

negatively affecting the group’s results as of this year. Early in the year, we

expect to hear an announcement either that the thin-film business has been sold

to a strategic partner or that it has been closed.

• When the full-year results are published in March, attention is likely to focus on

the first guidance for 2016. We expect the management team to underscore the

breakeven target for 2016 and a return to profitable growth.

VALUATION

Our current DCF-based price target of € 40.00 corresponds to an EV/sales2016e of

1.0x. This is in line with the historical valuation. We would consider higher multiples

to be appropriate again as soon as the visibility regarding long-term profitable

growth improves.

28/01/2016

Hold (Hold )

40.00 EUR (45.00 EUR )

Close 25/01/2016 29.96 EUR

Bloomberg: M5Z GY WKN: A0JQ5U

Sector Technology





YTD -3.7%

1 month -7.0%

12 months -43.7%

Share data

EV (m EUR; 2016) 223.9



Free float 57.9%



SWOT


• Broad range of products & technologies; diversified end markets

• Flexible business model & strong management

• Rising demand for automation from direct smartphone customers

• Business with Li-ion batteries is growing fast

• Solar option


• High R&D costs in the solar segment

• Some products' market share still small (e.g. vacuum coating)

• Single customer risk (largest customer accounts for >25% of revenues)

• Cyclical nature of the display market


• Dieter Manz (CEO)

• Martin Hipp (CFO)

Manz AG develops and builds machines for the production of displays,

batteries, solar cells, printed circuit boards (PCB) and other products. The

company was founded in 1987 as a specialist in automation technology.

Today, its core competencies also include laser processes, metrology and

vacuum coating. The takeover of Taiwan's Intech in 2008 added wet

chemical processing equipment to the company's portfolio. More than 70%

of its revenues are generated with customers in Asia. The company’s largest

customer in the smartphone segment accounts for more than 25% of

revenues.


• Revenues of € 200-210 m in 2015 • EBIT margin >10%



Next event: Annual Results 30/03/16 Dieter Manz 37.3

Ulrike Manz 3.8



0

10

20

30

40

50

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

69.2%

17.8%

8.3%4.7% Display

Printed Circuit Boards/OriginalEquipment ManufacturerBattery

Solar

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 205.0 240.0 270.0

Consensus 205.3 262.5 303.7

EBIT (in m EUR) BHL -47.2 1.2 13.7

Consensus -48.6 4.2 12.5

EPS (EUR)

BHL -9.27 0.03 1.76

Consensus -9.80 0.05 1.35

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - - Capex/Sales 4.4% 4.7% 7.3% 5.0% 4.8%


ROCE 1.3% -18.1% -36.1% 0.9% 9.8% Free cash flow yield 7.6% -0.8% -14.1% -4.3% 0.8%

Equity ratio 54.8% 55.2% 47.2% 45.6% 46.8%

Net debt / Equity 0% 7% 48% 59% 51%

Net debt / EBITDA 0.0 0.7 -1.3 4.3 2.0

Interest cover 0.9 < -10 < -10 0.8 > 10



Manz AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 266.2 305.9 205.0 240.0 270.0


Total sales 278.4 308.8 215.0 245.0 275.0





EBITDA 27.0 13.9 -32.7 12.5 25.0

Depreciation 23.9 46.7 14.5 11.3 11.3

EBITA 3.1 -32.8 -47.2 1.2 13.7



EBIT 3.1 -32.8 -47.2 1.2 13.7


Income on ordinary activities 0.1 -34.6 -48.7 0.2 12.7


EBT 0.1 -34.6 -48.7 0.2 12.7

Taxes -2.9 -3.6 -1.6 -0.1 -3.2

Net income from cont. operations -2.7 -38.2 -50.3 0.2 9.5



Net income (adj.) -3.1 -38.2 -50.3 0.2 9.5

No. of shares 4.5 4.9 5.4 5.4 5.4

EPS -0.68 -7.75 -9.27 0.03 1.76


2013 2014 2015e 2016e 2017e

Gross margin 39.7% 41.1% 37.2% 47.3% 48.1%

EBITDA margin 10.1% 4.5% -15.9% 5.2% 9.3%

EBITA margin 1.2% -10.7% -23.0% 0.5% 5.1%

EBIT margin 1.2% -10.7% -23.0% 0.5% 5.1%

EBT margin 0.1% -11.3% -23.7% 0.1% 4.7%

Net profit margin -1.2% -12.5% -24.5% 0.1% 3.5%

Tax rate 2040.7% -10.4% -3.3% 25.0% 25.0%



Sales 44.6% 14.9% -33.0% 17.1% 12.5%

EBITDA --- -48.5% --- --- >100%

EBIT --- --- 43.8% --- >100%

EBT --- --- 40.7% --- >100%

Net income (adj.) -90.8% >100% 31.6% --- >100%

EPS -90.9% >100% 19.7% --- >100%


Key figures



Manz AG – Balance sheet


Fixed assets 138.2 117.4 118.0 118.7 120.4





Current assets 181.0 136.0 87.3 103.6 117.1

Inventories 55.9 48.3 37.0 46.7 52.5



Securities 0.0 0.0 0.0 0.0 0.0

Cash 64.7 23.0 4.5 4.3 6.1

Total assets 319.2 253.5 205.3 222.2 237.5




Minorities 2.1 0.0 0.0 0.0 0.0







Short-term debt 46.4 10.2 25.2 35.2 35.2






Manz AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 43.3% 46.3% 57.5% 53.4% 50.7%



Current assets 56.7% 53.7% 42.5% 46.6% 49.3%

Inventories 17.5% 19.1% 18.0% 21.0% 22.1%


Cash 20.3% 9.1% 2.2% 1.9% 2.6%







Short-term debt 14.5% 4.0% 12.3% 15.8% 14.8%





Manz AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -3.1 -38.2 -50.3 0.2 9.5

Depreciation 23.9 46.7 14.5 11.3 11.3



Other 0.0 0.0 0.0 0.0 0.0

Operating Cash-flow before changes in w/c 21.0 11.7 -35.8 11.4 20.8

Change in inventory -1.5 7.6 11.3 -9.7 -5.8

Change in accounts receivable -1.4 -3.0 18.8 -6.8 -5.8

Change in accounts payable 4.0 -0.4 -8.1 5.8 5.0


Operating Cash-flow 26.9 12.4 -18.6 1.8 15.0







Free cash-flow 15.2 -1.7 -33.6 -10.2 2.0





Dividend paid 0.0 0.0 0.0 0.0 0.0

Cash-flow from financing activities -2.4 -31.4 15.0 10.0 0.0

Increase/ decrease in liquid assets 12.8 -33.1 -18.6 -0.2 2.0



Change in total cash and cash equivalents 12.1 -31.4 -18.6 -0.2 2.0





Manz AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.68 -7.75 -9.27 0.03 1.76


Free Cash-flow per share 3.37 -0.34 -6.20 -1.89 0.36


Valuation ratios

EV/Sales 1.1 1.0 1.2 1.0 0.8

EV/EBITDA 10.7 21.1 -7.3 18.5 9.2

EV/EBIT 92.9 -9.0 -5.0 192.4 16.7

Price Earnings ratio (P/E) -90.7 -7.2 -3.7 1,129.3 17.8


Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin 10.1% 4.5% -15.9% 5.2% 9.3%

EBIT margin 1.2% -10.7% -23.0% 0.5% 5.1%

Net return on sales -1.2% -12.5% -24.5% 0.1% 3.5%

Return on capital employed (ROCE) 1.3% -18.1% -32.4% 0.8% 8.3%

Productivity ratios


Operating leverage 1.1 11.6 -0.4 1.0 -10.4


EBIT per employee 1,587 0 0 613 6,997


Financial ratios

Equity ratio 54.8% 55.2% 43.7% 40.5% 41.8%


Net debt / Equity 0.1% 6.6% 47.7% 59.0% 51.5%

Interest cover 0.9 < -10 < -10 0.8 > 10

Net debt / EBITDA 0.01 0.67 -1.31 4.25 2.05


Change Working Capital (in m EUR) -1.1 -4.3 -22.0 10.6 6.7

WC /sales 25.9% 21.2% 20.8% 22.2% 22.2%






Others


EBIT CAGR (last 3 years) 76.8% -319.1% 15.4% -27.2% -174.8%

Net income CAGR (last 3 years) -224.6% -334.5% 14.3% -136.5% -163.0%

Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) 15.2 -1.7 -33.6 -10.2 2.0

Free cash flow yield 5.4% -0.6% -18.1% -6.0% 1.2%




in m EUR 2013 2014 2015 2016 2017

Sales 57.9 62.5 64.0 67.2 70.6

EBIT 6.1 6.3 5.8 6.7 7.7

EBIT margin 10.6% 10.1% 9.1% 10.0% 11.0%


Free cash-flow 4.7 3.4 1.1 2.4 3.1

EPS (in EUR) 0.29 0.34 0.35 0.42 0.49

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 0.9 1.2 1.1 0.9 0.9

EV/EBIT 8.7 12.3 11.7 9.4 7.8



Next event


Change in model

Sales EBIT EPS

2031e --- --- ---

2032e --- --- ---

2033e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Masterflex SE Managing growth – initiation of coverage

We are initiating our coverage of Masterflex with a HOLD rating and a price target

of € 6.00. We are confident about the company’s medium-term growth prospects

and believe it will return to double-digit profitability. First, however, the company

must put structural changes in place.

INVESTMENT CASE

Following a promising start to 2015, it failed to live up to expectations in the

further course of the year. Consequently, Masterflex adopted a package of measures

at the start of November. We assume that the company will implement them

successfully and will return to a double-digit EBIT margin (BHLe: 10.0%) by as soon

as 2016. The core items aim to reduce the complexity associated with the large

number of products and individual solutions:

• Streamlining the management structures

• Optimisation of marketing model

• Streamlining of product range

• Optimisation of in-house processes

We assume that the management team will be able to achieve savings of at least

€ 1 m with these measures. Masterflex has also announced that all of the one-off

negative effects will be reported on the 2015 balance sheet.

CATALYSTS

In our view, ahead of the results due out on 30 March, it is still too early to switch

to the buyer side. At the end of March, however, when Q1 comes to an end, the

visibility should improve and give us a better idea about whether our expectations

will be met.

VALUATION

Our price target is based on a DCF model and assumes a cautious medium-term

growth rate of 5%. If the visibility were to improve, we could imagine reduced

complexity even allowing a growth rate of 10%.

28/01/2016

Hold (n.a. )

6.00 EUR (- EUR )

Close 13/01/2016 5.72 EUR

Bloomberg: MZX GR WKN: 549293

Sector Industrial





YTD 3.1%

1 month -2.0%

12 months -19.4%

Share data

EV (m EUR; 2016) 63.2



Free float 62.3%



SWOT


• Considerable expertise in materials, applications and technology

• Mainstays of growth are internationalisation and innovation

• Room to manoeuvre financially and use acquisitions to gain further

technological expertise

• High quality of products and good availability are the basis for success


• Needs to reduce the complexity arising from large number of products

• Needs to improve efficiency by optimising in-house processes

• Needs to constantly stand out from the competition


• Dr. Andreas Bastin (CEO)

• Mark Becks (CFO)

Masterflex SE is an international group that specialises in hoses

manufactured from high-tech plastics.


• 2015: Revenue growth of between 2% and 4%

• 2015: EBIT slightly down on a year ago

• 2016: Double-digit EBIT margin

• -



Next event: 30/03/2016 Annual Results SVB GmbH & Co KG / Schmidt family 19.3

Monolith 11.3

BBC GmbH / Dr. Bastin, Becks 6.2



0

5

10

15

20

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

49.7%

23.3%

27.0%Germany

Rest of Europe

Rest of World

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 64.0 67.2 70.6

Consensus 64.3 67.6 73.0

EBIT (in m EUR) BHL 5.6 6.7 7.7


EPS (EUR)

BHL 0.34 0.42 0.49

Consensus 0.30 0.57 0.70

2013 2014 2015 2016 2017



ROCE 14.0% 14.3% 11.9% 12.8% 13.7% Free cash flow yield 7.5% 5.4% 2.1% 4.7% 6.1%

Equity ratio 40.7% 45.9% 47.2% 50.4% 53.7%

Net debt / Equity 84% 66% 54% 40% 26%

Net debt / EBITDA 2.0 1.7 1.7 1.3 0.8

Interest cover > 10 > 10 > 10 > 10 > 10



Masterflex SE – Income statement

in m EUR 2013 2014 2015 2016 2017

Sales 57.9 62.5 64.0 67.2 70.6


Total sales 58.3 63.0 64.5 67.2 70.6





EBITDA 8.8 9.2 8.7 9.7 10.8

Depreciation 2.7 2.9 2.9 3.0 3.1

EBITA 6.1 6.3 5.8 6.7 7.7



EBIT 6.1 6.3 5.8 6.7 7.7




EBT 4.5 5.2 4.8 5.7 6.7

Taxes -1.7 -2.0 -1.7 -2.0 -2.4


Net income from discont. operations -0.1 -0.2 0.0 0.0 0.0


Net income (adj.) 2.6 3.0 3.1 3.7 4.4

No. of shares 8.9 8.9 8.9 8.9 8.9

EPS 0.29 0.34 0.35 0.42 0.49


2013 2014 2015 2016 2017

Gross margin 68.7% 67.4% 67.5% 67.7% 67.8%

EBITDA margin 15.1% 14.7% 13.6% 14.4% 15.4%

EBITA margin 10.6% 10.1% 9.1% 10.0% 11.0%

EBIT margin 10.6% 10.1% 9.1% 10.0% 11.0%

EBT margin 7.8% 8.3% 7.5% 8.5% 9.6%


Tax rate 36.8% 37.8% 35.0% 35.0% 35.0%


Growth rates yoy 2013 2014 2015 2016 2017

Sales 5.3% 7.9% 2.5% 5.0% 5.0%

EBITDA -13.8% 4.6% -5.1% 11.4% 11.8%

EBIT -19.1% 3.3% -8.2% 15.4% 15.6%

EBT -21.8% 14.5% -7.6% 18.6% 18.4%

Net income (adj.) -41.6% 17.2% 2.5% 18.6% 18.4%

EPS -41.6% 17.2% 2.5% 18.6% 18.4%


Key figures



Masterflex SE – Balance sheet

Assets (in m EUR) 2013 2014 2015 2016 2017

Fixed assets 29.9 29.6 30.0 30.4 30.8





Current assets 21.8 22.4 27.2 30.5 34.4

Inventories 10.7 11.7 13.0 13.5 14.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 4.7 4.4 7.2 9.4 12.2

Total assets 51.7 52.0 57.1 60.8 65.2




Minorities 0.6 0.4 0.4 0.4 0.4







Short-term debt 4.4 5.2 5.7 5.5 5.3






Masterflex SE – Balance sheet structure

Assets 2013 2014 2015 2016 2017

Fixed assets 57.8% 56.9% 52.5% 49.9% 47.2%



Current assets 42.2% 43.1% 47.5% 50.1% 52.8%

Inventories 20.7% 22.5% 22.8% 22.2% 21.5%


Cash 9.2% 8.5% 12.5% 15.4% 18.8%







Short-term debt 8.4% 9.9% 10.0% 9.0% 8.1%





Masterflex SE – Cash flow statement

in m EUR 2013 2014 2015 2016 2017

Net income (adj.) 2.6 3.0 3.1 3.7 4.4

Depreciation 2.4 2.5 2.9 3.0 3.1


Change of provisions -0.1 -0.2 0.2 0.0 0.0

Other 2.1 1.8 0.0 0.0 0.0



Change in accounts receivable 0.7 0.6 -0.7 -0.6 -0.6










Free cash-flow 4.7 3.4 1.1 2.4 3.1


Increase/decrease in debt position -0.5 -2.4 1.5 -0.2 -0.2



Dividend paid -0.2 -0.2 0.0 0.0 0.0

Cash-flow from financing activities -2.2 -3.6 1.6 -0.2 -0.2


Effects of exchange rate changes -0.6 -0.1 0.0 0.0 0.0







Masterflex SE – Ratios

2013 2014 2015 2016 2017

Per Share Data

EPS 0.29 0.34 0.35 0.42 0.49




Valuation ratios

EV/Sales 0.9 1.2 1.1 0.9 0.9

EV/EBITDA 6.1 8.5 7.8 6.5 5.6

EV/EBIT 8.7 12.3 11.7 9.4 7.8



Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin 15.1% 14.7% 13.6% 14.4% 15.4%

EBIT margin 10.6% 10.1% 9.1% 10.0% 11.0%



Productivity ratios






Financial ratios

Equity ratio 40.7% 45.9% 47.2% 50.4% 53.7%


Net debt / Equity 84.4% 66.2% 54.0% 39.6% 25.9%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 2.03 1.72 1.67 1.25 0.84



WC /sales 24.5% 24.9% 27.0% 27.1% 27.1%






Others




Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%






in EUR m 2013 2014 2015e 2016e 2017e

Total income 501.1 531.1 553.6 620.7 639.6


CET1 ratio % 16.3% 13.6% 14.0% 14.5% 15.0%

EPS 0.24 0.27 0.20 0.32 0.36

TNAV per share 3.47 3.49 3.52 3.71 3.82



P/TNAV 1.50 1.06 1.04 0.83 0.80

Dividend yield 3.1% 4.6% 3.5% 6.5% 7.8%


Next event


Change in model

PBT EPS DPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Andreas Schäfer , Analyst

Phone: +49 (0)211 4952-819

[email protected]


MLP AG Recovery postponed until 2016

Negative one-off effects in Q3 and a still very weak performance in old-age

provision are the reasons why MLP will not achieve the expected EBIT target of

slightly above € 39 m in 2015. We still believe that MLP’s business model is intact

and we anticipate a major EBIT increase in 2016. Our price target remains

unchanged at € 4.00. .

INVESTMENT CASE

• The profit warning in Q3 was chiefly due to a stronger than expected slump in

new old-age provision business, lower performance-related fees at FERI, a tax

arrears payment and the integration costs for DOMCURA. MLP no longer expects

the EBIT to improve marginally in 2015.

• However, in our view, MLP’s long-term prospects remain cautiously optimistic.

The company’s cost control remains strict and, with the exception of old-age

provision, each business unit should register growth in 2015. Following the

acquisition of DOMCURA, the struggling old-age provision unit has probably only

accounted for less than 40% of the commission income.

CATALYSTS

MLP will publish its FY 2015 results on 25 February 2016. We believe MLP will aim

to increase its EBIT in 2016. Our forecast for 2016 is an EBIT of € 47 m.

VALUATION

Based on our estimates, MLP is trading at a 2016 PER of 11.5x. Taking account of a

potential reduction of the dividend to € 0.13, the dividend yield comes to 3.5%.

28/01/2016

Hold (Hold )

4.00 EUR (4.00 EUR )

Close 25/01/2016 3.08 EUR

Bloomberg: MLP GY WKN: 656990





Compared to SDAX

YTD -7.7%

1 month -9.0%

12 months -23.3%

Share data



Free float 49.8%



SWOT


• One of the leading independent financial advisors in Germany

• Attractive client base with a strong focus on academics


• Environment for old-age provision and health insurance remains difficult

• Number of consultants continue to shrink

• Regulatory environment still uncertain


• Dr. Uwe Schroeder-Wildberg (CEO)

• Reinhard Loose (CFO)

• Manfred Bauer

MLP AG is one of Germany’s leading financial consultancy firms, specialising

in pension and insurance products. More than 2,000 advisors support around

815,000 private and some 5,000 corporate clients in Germany. MLP also

provides asset management solutions to institutional investors and high net

worth individuals via its subsidiary Feri. The company was founded in 1971

and is headquartered in Wiesloch, Germany.


• Administrative costs of € 255 m • -



Next event: 25/02/2016 Annual Results Family Lautenschläger 29.6

Harris Associates 9.8

Talanx 9.5



5

10

15

20

25

30

01.01.06 07.01.07 01.01.09 07.01.10 01.01.12 07.01.13 01.01.15

PER AVG STD-1 STD+1

49%

30%

9%

7%3%

2%

Old-age provision

Wealth management

Health insurance

P&C insurance

Financing

Other

Company Overview

2015e 2016e 2017e

PBT (m) BHL 28.9 46.7 53.8

Consensus 31.6 41.3 47.0

DPS (EUR)

BHL 0.13 0.20 0.24

Consensus 0.16 0.20 0.21

EPS (EUR) BHL 0.20 0.32 0.36

Consensus 0.23 0.30 0.32

in EUR m 2013 2014 2015e 2016e 2017e

Total income 501.1 531.1 553.6 620.7 639.6 Profit before tax 33.1 37.7 28.9 46.7 53.8

CET1 ratio % 16.3% 13.6% 14.0% 14.5% 15.0%

EPS 0.24 0.27 0.20 0.32 0.36

TNAV per share 3.47 3.49 3.52 3.71 3.82


Price Earnings ratio (P/E) 22.06 13.82 18.66 9.74 8.45 P/TNAV 1.50 1.06 1.04 0.83 0.80

Dividend yield 3.1% 4.6% 3.5% 6.5% 7.8%



MLP AG – Income statement

EUR m 2013 2014 2015e 2016e 2017e

Total income 501.1 531.1 553.6 620.7 639.6

Loan loss provisions 0.0 0.0 0.0 0.0 0.0

Costs -250.6 -256.8 -266.0 -276.0 -278.5

Other income / expense -217.3 -236.7 -258.7 -298.0 -307.3


Taxes -7.6 -8.7 -7.4 -12.1 -14.0

Profit after tax 25.5 29.0 21.5 34.5 39.8

NCI & other (PL) 0.0 0.0 0.0 0.0 0.0

Earnings 25.5 29.0 21.5 34.5 39.8

Dividend paid 34.5 17.3 18.3 14.2 26.2

Retained earnings -9.0 11.7 3.2 20.3 13.6


.

MLP AG – Balance sheet

EUR m 2013 2014 2015e 2016e 2017e

Customer loans 981.7 1,055 1,041 1,055 1,055


Other assets 399.9 413.6 431.6 424.5 429.5

Total assets 1,537 1,625 1,638 1,645 1,650

Customer deposits 956.4 1,025 1,043 1,013 1,006


NCI & other (BS) 0.0 0.0 0.0 0.0 0.0




MLP AG – Balance sheet structure

2013 2014 2015e 2016e 2017e

Customer loans 981.7 1,055 1,041 1,055 1,055


Other assets 399.9 413.6 431.6 424.5 429.5

Total assets 1,537 1,625 1,638 1,645 1,650

Customer deposits 956.4 1,025 1,043 1,013 1,006


NCI & other (BS) 0.0 0.0 0.0 0.0 0.0




Key figures



MLP AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

No. of shares (m) 107.9 107.9 109.3 109.3 109.3

Number of Shares (Average) (m) 107.9 107.9 109.3 109.3 109.3

EPS 0.24 0.27 0.20 0.32 0.36

TNAV per share 3.47 3.49 3.52 3.71 3.82


Profit & loss data

CIR 88.7% 87.2% 89.9% 85.8% 84.1%

Tax ratio 22.9% 23.1% 25.6% 26.0% 26.0%

PBT growth -55.7% 13.8% -23.2% 61.5% 15.3%

EPS growth -51.6% 13.6% -26.7% 60.6% 15.3%

ROTE - - - - -

Balance sheet data

RWA (m) 0.0 0.0 0.0 0.0 0.0

CET1 ratio % 16.3% 13.6% 14.0% 14.5% 15.0%

Tier 1 ratio % - - - - -

Leverage ratio % - - - - -

LCR % - - - - -

NSFR % - - - - -

Valuation ratios


P/TNAV 1.5 1.1 1.0 0.8 0.8

Dividend yield 3.1% 4.6% 3.5% 6.5% 7.8%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 2,985 2,972 3,299 3,464 3,637

EBIT 62 128 86 111 145

EBIT margin 2.1% 4.3% 2.6% 3.2% 4.0%


Free cash-flow 29 26 45 -6 22

EPS (in EUR) 0.35 4.30 2.62 3.64 5.16

DPS (in EUR) 0.50 0.50 0.50 0.60 0.80

Dividend yield 0.2% 0.3% 0.3% 0.3% 0.4%

EV/Sales 1.1 0.8 0.8 0.7 0.7

EV/EBIT 51.1 17.5 30.5 22.2 16.8



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Peter Steiner , CFA

Phone: +49 (0)211 4952-336

[email protected]


PUMA SE In the midst of a re-alignment

In our view, Puma is only at the beginning of a repositioning of the brand, which is

expected to weigh heavily on earnings at least until the end of 2016. In the short

term, we also expect negative effects from the depreciating euro to hit Puma’s gross

margin in H1. However, 2016 should be a good year for the industry due to this

year’s sporting events.

INVESTMENT CASE

Puma is currently repositioning itself under the tagline "Forever Faster". The focus

on performance products - primarily in the football and running segments - is the

right move, in our view. However, we believe that the repositioning of a brand takes

at least three to five years. We therefore do not expect considerable positive effects

before 2017 and do not see a buying opportunity for the share. Nevertheless, 2016

should be a good year for the sporting goods industry with the UEFA European

Championship taking place in France and the Olympic Games in Brazil. We agree

that Puma has made progress in the football segment. In particular, the deal with

Arsenal FC should be worthwhile even though it was expensive. Moreover, Puma is

supplying the kits for six teams at the Euro 2016 championship.

CATALYSTS

On 18 February, Puma will report its figures for the financial year just ended. We

expect them to be in line with the company’s guidance.

VALUATION

We arrive at a DCF-based fair value per share of € 133.00. Based on our 2016 EPS

estimate of € 3.64, the share is currently trading at a PER of 50.4x, which represents

a premium to the peer group of 88%. We believe the main reason for the high

valuation is recurring speculation about a squeeze-out by Kering or a takeover.

28/01/2016

Sell (Sell )

133.00 EUR (133.00 EUR )

Close 25/01/2016 187.35 EUR

Bloomberg: PUM GY WKN: 696960

Sector Consumer




Compared to SDAX

YTD 2.8%

1 month 2.5%

12 months -0.4%

Share data

EV (m EUR; 2016) 2,462

Market Cap (m EUR) 2,799


Free float 14.2%



SWOT


• Strong brand name with a long-standing history

• Stronger focus on performance sports instead of lifestyle

•

• Potential market share gains thanks to brand repositioning


• Multi-year restructuring period with falling revenues and margins

• Still-high proportion of lifestyle products

• Highly competitive environment hindering market share gains

• Must regain retailer/consumer confidence in its performance products

• Highly sensitive to currency fluctuations


• Björn Gulden (CEO)

• Michael Lämmermann (CFO)

• Lars Soerensen (COO)

Puma is one of the world’s leading sports brands. The company designs,

manufactures and markets footwear, apparel and accessories for numerous

disciplines including football, running, fitness, golf, and motorsports. Puma

distributes its products in more than 120 countries and employs some

10,000 people. The company was founded in 1948 and is headquartered in

Herzogenaurach, Germany.


• Mid-single-digit revenue growth in 2015 (currency-adjusted)

• Gross margin to decline by 100-150 basis points

• 2015 EBIT of € 80-100 m

• -



Next event: 18/02/2016 Annual Results Kering 85.8

Own shares 1.0



10152025303540455055

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

43.2%

37.1%

19.7%Shoes

Textiles

Accessories

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 3,299 3,464 3,637

Consensus 3,348 3,540 3,748

EBIT (in m EUR) BHL 86 111 145


EPS (EUR)

BHL 2.62 3.64 5.16

Consensus 2.61 3.69 5.64

2013 2014 2015e 2016e 2017e



ROCE 4.0% 7.7% 5.0% 6.3% 8.0% Free cash flow yield 0.8% 1.0% 2.0% -0.2% 1.0%

Equity ratio 64.9% 63.5% 65.2% 65.7% 66.5%

Net debt / Equity -24% -24% -24% -23% -23%

Net debt / EBITDA -3.1 -2.1 -2.8 -2.3 -1.9

Interest cover > 10 0.0 > 10 > 10 0.0



PUMA SE – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 2,985 2,972 3,299 3,464 3,637

Cost of Sales -1,598 -1,587 -1,805 -1,877 -1,953

Gross profit 1,388 1,385 1,494 1,586 1,684

Sales and marketing -1,217 -1,277 -1,432 -1,500 -1,564

General and administration 0 0 0 0 0

Research and development 0 0 0 0 0

Other operating result -108 20 23 24 25

EBITDA 116 179 142 170 207


EBITA 62 128 86 111 145



EBIT 62 128 86 111 145




EBT 54 122 80 105 139

Taxes -33 -37 -23 -30 -40



Minority interest -16 -21 -18 -20 -22

Net income (adj.) 5 64 39 54 77

No. of shares 15 15 15 15 15

EPS (in EUR) 0.35 4.30 2.62 3.64 5.16


2013 2014 2015e 2016e 2017e

Gross margin 46.5% 46.6% 45.3% 45.8% 46.3%

EBITDA margin 3.9% 6.0% 4.3% 4.9% 5.7%

EBITA margin 2.1% 4.3% 2.6% 3.2% 4.0%

EBIT margin 2.1% 4.3% 2.6% 3.2% 4.0%

EBT margin 1.8% 4.1% 2.4% 3.0% 3.8%


Tax rate 60.5% 30.4% 29.0% 29.0% 29.0%



Sales -8.7% -0.4% 11.0% 5.0% 5.0%

EBITDA -27.6% 53.6% -20.5% 19.7% 22.1%

EBIT -44.9% >100% -33.0% 29.2% 31.3%

EBT -52.2% >100% -34.0% 30.3% 33.0%

Net income (adj.) -92.5% >100% -39.0% 39.1% 41.5%

EPS -92.4% >100% -39.0% 39.1% 41.5%


Key figures



PUMA SE – Balance sheet


Fixed assets 794 867 898 928 958





Current assets 1,514 1,683 1,631 1,653 1,696

Inventories 521 572 560 580 600




Cash 390 402 426 413 426

Total assets 2,309 2,550 2,529 2,581 2,654


Shareholders’ equity 1,497 1,618 1,650 1,697 1,765

Shareholders’ equity (before minority) 1,482 1,595 1,627 1,674 1,742














PUMA SE – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 34.4% 34.0% 35.5% 36.0% 36.1%



Current assets 65.6% 66.0% 64.5% 64.0% 63.9%

Inventories 22.6% 22.4% 22.1% 22.5% 22.6%


Cash 16.9% 15.7% 16.8% 16.0% 16.0%







Short-term debt 1.1% 0.8% 1.0% 1.0% 0.9%





PUMA SE – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 5 64 39 54 77




Other 97 31 14 0 0


Change in inventory -9 -50 12 -20 -20


Change in accounts payable -69 142 -135 5 5

Change in other working capital positions 0 -5 80 0 0




Financial investments 0 -21 0 0 0






Increase/decrease in debt position -13 -10 5 0 0



Dividend paid -8 -8 -7 -7 -9


Increase/ decrease in liquid assets 4 -10 38 -13 13



Change in total cash and cash equivalents -17 -2 38 -13 13





PUMA SE – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.35 4.30 2.62 3.64 5.16


Free Cash-flow per share 1.95 1.73 3.01 -0.37 1.47


Valuation ratios

EV/Sales 1.1 0.8 0.8 0.7 0.7

EV/EBITDA 27.5 12.6 18.5 14.5 11.8

EV/EBIT 51.1 17.5 30.5 22.2 16.8



Dividend yield 0.2% 0.3% 0.3% 0.3% 0.4%


EBITDA margin 3.9% 6.0% 4.3% 4.9% 5.7%

EBIT margin 2.1% 4.3% 2.6% 3.2% 4.0%



Productivity ratios


Operating leverage 0.4 -1.1 0.3 -0.3 -0.3




Financial ratios

Equity ratio 64.9% 63.5% 65.2% 65.7% 66.5%


Net debt / Equity -24.4% -23.6% -24.3% -22.8% -22.7%

Interest cover > 10 0.0 > 10 > 10 0.0

Net debt / EBITDA -3.14 -2.14 -2.83 -2.28 -1.93


Change Working Capital (in m EUR) -112 -66 140 30 25

WC /sales 19.1% 17.0% 19.6% 19.5% 19.2%






Others

Sales CAGR (last 3 years) 3.3% -0.4% 0.3% 5.1% 7.0%



Pay out ratio 140.9% 11.6% 19.1% 16.5% 15.5%

Free cash-flow (in m EUR) 29 26 45 -6 22

Free cash flow yield 0.8% 1.0% 1.5% -0.2% 0.8%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 455.7 431.4 407.0 393.0 395.7

EBITDA 77.4 35.0 42.2 42.8 50.9

EBITDA margin 17.0% 8.1% 10.4% 10.9% 12.9%


Free cash-flow 25.6 -24.9 6.6 9.8 13.3

EPS (in EUR) 0.19 -0.27 -0.09 -0.02 0.05

DPS (in EUR) 0.10 0.10 0.04 0.06 0.09

Dividend yield 2.3% 5.7% 2.6% 3.9% 5.8%

EV/Sales 1.3 0.7 0.7 0.7 0.7

EV/EBITDA 7.5 9.0 6.9 6.8 5.6

Price Earnings ratio (P/E) 22.5 -6.4 -17.0 -101.5 30.2


Next event


Change in model

Sales EBITDA EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Wolfgang Specht , Analyst

Phone: +49 (0)211 4952-637

[email protected]


QSC AG Waiting for enterprise cloud

We believe that QSC will re-invest most of the cost savings achieved in 2015 in

developing its own cloud platform in FY 2016. This should provide the basis for

future growth. We confirm our BUY rating in view of a positive growth trend for IT

services, moderate valuation multiples and consolidation opportunities.

MARKET FOR CLOUD APPLICATIONS IS STILL IN AN EARLY PHASE

In our view, the ongoing “Clarity” cost optimisation programme is making good

progress and should cut the cost base in 2016 by ~ € 20 m vs. FY 2014. We believe

it will be profitable (and sensible) to re-invest most of these savings in the cloud

platform in order to diversify the company away from its still-dominant (but

declining) telecoms business and participate in the current growth of the cloud

services market for corporate clients. QSC’s existing traditional outsourcing business

for German SME IT services should put it in a good position to benefit from the

trend towards the virtualisation business processes.

CATALYSTS

• Progress with the restructuring programme (update with report for FY 2015).

We expect it to be concluded in 2016.

• Official start of Pure Enterprise Platform in Q1 2016.

• New customer gains in the cloud segment and migration of traditional IT

outsourcing customers to the cloud platform as of H2 2016.

• Active and passive consolidation options.

VALUATION

The share is currently trading at a discount of ~ 20% based on the EV/EBITDA

multiples for 2016/17, but still appears expensive given the EV/sales and PER. Our

price target of € 2.20 is based on a DCF model.

28/01/2016

Buy (Buy )

2.20 EUR (2.20 EUR )

Close 25/01/2016 1.55 EUR

Bloomberg: QSC GR WKN: 513700

Sector Technology




Compared to TecDAX

YTD 10.6%

1 month 9.1%

12 months -27.4%

Share data

EV (m EUR; 2016) 291.9



Free float 75.0%



SWOT


• Positioning in the synthesis of information technology and

telecommunication

• Highly innovative in cloud computing

• Growing demand for customer-specific solutions

• Established brand among German SMEs


• Contracting legacy telecoms business

• Established IT systems providers make the market highly competitive

• Dependent upon telecoms regulatory regime

• Scarcity of qualified specialists


• Jürgen Hermann (CEO)

• Stefan Baustert (CFO)

• Henning Reinecke

QSC AG is one of the leading providers of ICT services in Germany with an

extensive offering that ranges from telephony, data transfer, housing and

hosting to IT outsourcing and IT consulting. With its own network

infrastructure, as well as TÜV- and ISO-certified data centres in Germany,

QSC employs around 1,800 people and is included in the TecDAX index. The

company was founded in 1997 and is headquartered in Cologne, Germany.


• 2015: Revenue: >€ 400 m, EBITDA >€ 42 m, FCF >€ 5 m • -



Next event: 30/03/2016 Annual Results Gerd Eickers 12.6

Dr. Bernd Schlobohm 12.5



0102030405060708090

100

2010 2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

48.0%

28.2%

23.8%Direct Sales

Indirect Sales

Resellers

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 407.0 393.0 395.7

Consensus 405.0 392.0 394.0

EBITDA (in m EUR) BHL 42.2 42.8 50.9

Consensus 42.3 43.0 46.8

EPS (EUR)

BHL -0.09 -0.02 0.05

Consensus -0.08 0.00 0.04

2013 2014 2015e 2016e 2017e



ROCE 8.8% -10.2% -2.6% 1.6% 5.0% Free cash flow yield 4.7% -11.5% 3.5% 5.3% 7.2%

Equity ratio 49.5% 35.9% 32.5% 31.4% 31.2%

Net debt / Equity 21% 63% 80% 80% 76%

Net debt / EBITDA 0.5 2.6 2.3 2.2 1.7

Interest cover > 10 < -10 < -10 0.8 > 10



QSC AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 455.7 431.4 407.0 393.0 395.7

Cost of Sales -303.5 -327.1 -300.0 -286.4 -286.3

Gross profit 152.3 104.4 107.0 106.6 109.4




Other operating result -2.5 -8.4 0.0 0.0 0.0

EBITDA 77.4 35.0 42.2 42.8 50.9

Depreciation 50.9 69.0 50.1 38.0 36.0

EBITA 26.5 -34.0 -7.9 4.8 14.9



EBIT 26.5 -34.0 -7.9 4.8 14.9


Income on ordinary activities 22.7 -40.2 -13.8 -1.3 9.1


EBT 22.7 -40.2 -13.8 -1.3 9.1

Taxes 0.9 6.2 2.8 -0.6 -2.7

Net income from cont. operations 23.6 -33.9 -11.0 -1.9 6.4



Net income (adj.) 23.6 -33.9 -11.0 -1.9 6.4

No. of shares 124.0 124.1 124.2 124.3 124.4

EPS (in EUR) 0.19 -0.27 -0.09 -0.02 0.05


2013 2014 2015e 2016e 2017e

Gross margin 33.4% 24.2% 26.3% 27.1% 27.6%

EBITDA margin 17.0% 8.1% 10.4% 10.9% 12.9%

EBITA margin 5.8% -7.9% -1.9% 1.2% 3.8%

EBIT margin 5.8% -7.9% -1.9% 1.2% 3.8%

EBT margin 5.0% -9.3% -3.4% -0.3% 2.3%

Net profit margin 5.2% -7.9% -2.7% -0.5% 1.6%

Tax rate -4.1% 15.5% 20.3% -46.2% 29.7%



Sales -5.4% -5.3% -5.7% -3.4% 0.7%

EBITDA -0.2% -54.7% 20.4% 1.4% 18.9%

EBIT 7.8% --- -76.7% --- >100%

EBT 9.4% --- -65.6% -90.6% ---

Net income (adj.) 23.2% --- -67.6% -82.7% ---

EPS 32.2% --- -67.6% -82.7% ---


Key figures



QSC AG – Balance sheet


Fixed assets 257.5 236.2 213.3 202.9 196.0





Current assets 134.5 169.3 163.1 164.1 170.5

Inventories 0.0 0.0 0.0 0.0 0.0



Securities 0.0 0.0 0.0 0.0 0.0

Cash 58.7 87.8 81.9 86.7 92.6

Total assets 392.0 405.5 376.5 367.0 366.5




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 8.4 8.9 8.9 8.9 8.9






QSC AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 65.7% 58.2% 56.7% 55.3% 53.5%



Current assets 34.3% 41.8% 43.3% 44.7% 46.5%

Inventories 0.0% 0.0% 0.0% 0.0% 0.0%


Cash 15.0% 21.7% 21.8% 23.6% 25.3%







Short-term debt 2.1% 2.2% 2.4% 2.4% 2.4%





QSC AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 23.6 -33.9 -11.0 -1.9 6.4

Depreciation 50.9 69.0 50.1 38.0 36.0


Change of provisions -9.3 6.8 -1.5 -0.9 0.2

Other -0.5 -0.6 0.2 0.1 0.0



Change in accounts receivable 10.6 -2.1 -1.4 2.9 -0.3

Change in accounts payable 5.2 -17.4 -3.6 -1.4 0.3

Change in other working capital positions -16.2 -13.8 1.1 0.6 -0.1



Payments for acquisitions 0.0 -3.6 0.0 0.0 0.0

Financial investments -0.9 -3.0 0.6 0.3 -0.1




Free cash-flow 25.6 -24.9 6.6 9.8 13.3





Dividend paid -11.1 -12.4 -12.4 -5.0 -7.5










QSC AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.19 -0.27 -0.09 -0.02 0.05




Valuation ratios

EV/Sales 1.3 0.7 0.7 0.7 0.7

EV/EBITDA 7.5 9.0 6.9 6.8 5.6

EV/EBITDA 21.9 -9.3 -36.9 60.8 19.2

Price Earnings ratio (P/E) 22.5 -6.4 -17.0 -101.5 30.2


Dividend yield 2.3% 5.7% 2.6% 3.9% 5.8%


EBITDA margin 17.0% 8.1% 10.4% 10.9% 12.9%

EBIT margin 5.8% -7.9% -1.9% 1.2% 3.8%

Net return on sales 5.2% -7.9% -2.7% -0.5% 1.6%

Return on capital employed (ROCE) 8.8% -10.2% -2.6% 1.6% 5.0%

Productivity ratios


Operating leverage -0.1 2.3 0.8 1.6 -2.1


EBIT per employee 15,692 0 0 2,615 7,806


Financial ratios

Equity ratio 49.5% 35.9% 32.5% 31.4% 31.2%


Net debt / Equity 21.3% 62.7% 79.5% 80.1% 75.7%

Interest cover > 10 < -10 < -10 0.8 > 10

Net debt / EBITDA 0.53 2.61 2.30 2.16 1.70


Change Working Capital (in m EUR) -16.8 12.8 4.9 -1.5 0.1

WC /sales -1.2% 1.7% 3.0% 2.7% 2.7%






Others

Sales CAGR (last 3 years) 2.6% -3.4% -5.4% -4.8% -2.8%

EBIT CAGR (last 3 years) 8.4% -209.0% -168.5% -43.4% -176.0%


Pay out ratio 52.5% -36.6% -45.2% -392.5% 174.9%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 304.4 308.5 305.0 280.0 294.0

EBIT 24.9 18.3 3.3 14.5 16.2

EBIT margin 8.2% 5.9% 1.1% 5.2% 5.5%

Net financial debt 6.2 32.7 13.0 -1.6 -3.4

Free cash-flow 3.2 -15.5 0.1 14.7 8.5

EPS (in EUR) 2.59 1.67 0.05 1.26 1.44

DPS (in EUR) 1.00 0.80 0.02 0.50 0.58

Dividend yield 2.7% 2.0% 0.1% 1.6% 1.9%

EV/Sales 1.0 1.2 1.1 1.0 1.0

EV/EBIT 12.8 20.8 96.0 20.3 18.0



Next event


Change in model

Sales EBIT EPS

2015e --- --- -

2016e --- --- 4.4%

2017e --- --- 3.8%

Analyst


Phone: +49 (0)211 4952-455

[email protected]


R. STAHL AG Lower oil price weighing on prospects

As several of R. Stahl's end markets are in a weak state (primarily the oil and gas

industry, but also shipbuilding and chemicals), we are currently very cautious about

the share. The company’s revenue is likely to decline in 2016. The valuation

multiples are at a very high level.

INVESTMENT CASE

Before the oil price collapsed, R. Stahl generated around 50% of its revenue in the

oil and gas industry. This revenue share has probably already decreased in 2015. Due

to the investment restraint in this industry, R. Stahl had to cut its guidance for 2015

and reduce its capacities. The company anticipates a revenue decline in 2016. Most

oil price forecasts provide few grounds for the time being to hope for an

improvement of this business for R. Stahl. The company has set itself a target of

reducing its dependency on the oil and gas industry by focusing more on other

areas, such as the chemicals and pharmaceuticals industries. The biggest

disappointment with R. Stahl in the past few years has been its margins. The

company is a long way away from its margin target of 10%.

CATALYSTS

• In our view, R. Stahl’s current environment leaves no room for any positive

earnings surprises. Investors are unlikely to find the prospect of falling revenue in

2016 attractive.

• Having fended off the takeover bid from Weidmüller in 2014, the share is still

trading at multiples that we believe would be at best justified in the event of

another takeover offer. However, we see no sign of this.

VALUATION

Based on our estimates, the share is currently trading at a high EV/EBIT multiple for

2016 of ~ 20x and a PER of ~ 25x. We therefore reiterate our HOLD rating.

28/01/2016

Hold (Hold )

29.00 EUR (29.00 EUR )

Close 25/01/2016 31.16 EUR

Bloomberg: RSL2 GY WKN: A1PHBB

Sector Technology





YTD 2.9%

1 month 7.3%

12 months -18.1%

Share data

EV (m EUR; 2016) 293.0



Free float 33.9%



SWOT


• Strong market position (global number two)

• High market entry barriers due to tough security requirements

• High percentage of recurring revenues (roughly 30%)

• European ICE standard is gaining market share vs. US NEC standard

• Market share gains from acquisitions


• Margin too low given the strong market position

• Strong growth is weighing on margins, just like in previous years

• Customers with cyclical investment behaviour

• Low oil price: 50% exposure to oil & gas industry (pre crises)


• Martin Schomaker (CEO)

• Bernd Marx (CFO)

R. Stahl AG is a leading supplier of products, systems and services for

explosion protection. Its products prevent explosions wherever there are

explosive gas-air mixtures or dusts (chemical and pharmaceutical industry,

food sector, oil and gas industry). As a European company, R.STAHL

specialises in products certified according to the European IEC standards.


• 2015: Sales and order intake of € 300 - 310 m

• EBIT 2015: € 2 - 5 m, including € 8 m one-off charge

• -



Next event: 26/02/2016 Preliminary Results Family 51.0

RAG Foundation 10.0

LBBW

5.0



5

15

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

31%

18%10%

11%

30%

Oil&Gas

Pharmaceutical industry

Others

Ship building

Chemical industry

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 305.0 280.0 294.0

Consensus 309.0 282.0 291.0

EBIT (in m EUR) BHL 3.3 14.5 16.2

Consensus 2.9 11.1 16.8

EPS (EUR)

BHL 0.05 1.26 1.44

Consensus -0.19 0.90 1.52

2013 2014 2015e 2016e 2017e



ROCE 12.9% 8.4% 1.5% 6.1% 6.7% Free cash flow yield 1.4% -6.7% 0.0% 7.4% 4.2%

Equity ratio 37.1% 27.3% 33.3% 35.5% 37.0%

Net debt / Equity 7% 44% 14% -2% -3%

Net debt / EBITDA 0.2 1.0 0.8 -0.1 -0.1

Interest cover > 10 > 10 0.0 0.0 0.0



R. STAHL AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 304.4 308.5 305.0 280.0 294.0


Total sales 310.7 317.2 307.0 285.0 299.0



Unusual or infrequent items 0.0 0.0 -8.0 0.0 0.0


EBITDA 36.9 31.1 16.2 27.5 30.2

Depreciation 6.3 7.3 7.3 7.0 7.5

EBITA 30.6 23.8 8.8 20.5 22.7



EBIT 24.9 18.3 3.3 14.5 16.2




EBT 21.3 14.7 0.4 11.6 13.3

Taxes -5.9 -4.9 -0.1 -3.5 -4.0



Minority interest -0.1 -0.1 0.0 0.0 0.0

Net income (adj.) 15.3 9.8 0.3 8.1 9.3

No. of shares 5.9 5.9 5.9 5.9 5.9

EPS 2.59 1.67 0.05 1.26 1.44


2013 2014 2015e 2016e 2017e

Gross margin 65.4% 64.3% 66.3% 66.4% 65.9%

EBITDA margin 12.1% 10.1% 5.3% 9.8% 10.3%

EBITA margin 10.0% 7.7% 2.9% 7.3% 7.7%

EBIT margin 8.2% 5.9% 1.1% 5.2% 5.5%

EBT margin 7.0% 4.8% 0.1% 4.1% 4.5%


Tax rate 27.7% 33.1% 30.0% 30.0% 30.0%



Sales 4.6% 1.4% -1.1% -8.2% 5.0%

EBITDA 0.5% -15.7% -48.1% 69.9% 10.0%

EBIT -0.2% -26.5% -81.7% >100% 12.0%

EBT 0.9% -31.0% -97.0% >100% 15.0%

Net income (adj.) 6.7% -36.2% -96.8% >100% 15.0%

EPS 6.7% -35.6% -97.1% >100% 15.0%


Key figures



R. STAHL AG – Balance sheet


Fixed assets 109.7 124.6 129.7 127.9 125.7





Current assets 137.8 149.3 154.1 160.7 167.5

Inventories 48.6 56.4 54.6 50.7 53.2



Securities 0.0 0.0 0.0 0.0 0.0

Cash 25.0 15.8 27.0 41.6 43.4

Total assets 247.6 273.9 283.9 288.6 293.2




Minorities 0.3 0.3 0.3 0.3 0.3







Short-term debt 15.5 35.6 15.0 15.0 15.0






R. STAHL AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 44.3% 45.5% 45.7% 44.3% 42.9%



Current assets 55.7% 54.5% 54.3% 55.7% 57.1%

Inventories 19.6% 20.6% 19.2% 17.6% 18.1%


Cash 10.1% 5.8% 9.5% 14.4% 14.8%







Short-term debt 6.3% 13.0% 5.3% 5.2% 5.1%





R. STAHL AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 15.3 9.8 0.3 8.1 9.3

Depreciation 6.3 7.3 7.3 7.0 7.5



Other -1.5 -1.1 0.0 0.0 0.0


Change in inventory 0.0 -7.8 1.8 3.9 -2.5

Change in accounts receivable 2.8 -4.5 1.9 4.1 -2.6

Change in accounts payable -1.7 1.1 -0.6 -1.2 0.8

Change in other working capital positions 2.5 -8.1 1.8 -1.9 1.2








Free cash-flow 3.2 -15.5 0.1 14.7 8.5


Increase/decrease in debt position 11.7 17.2 -8.5 0.0 0.0


Other financing Cash-flow 0.0 0.0 0.3 0.0 -3.5

Dividend paid -5.9 -5.8 -5.2 -0.1 -3.2

Cash-flow from financing activities 5.7 5.8 11.1 -0.1 -6.7









R. STAHL AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.59 1.67 0.05 1.26 1.44




Valuation ratios

EV/Sales 1.0 1.2 1.1 1.0 1.0

EV/EBITDA 8.6 12.2 19.9 10.7 9.6

EV/EBIT 12.8 20.8 96.0 20.3 18.0



Dividend yield 2.7% 2.0% 0.1% 1.6% 1.9%


EBITDA margin 12.1% 10.1% 5.3% 9.8% 10.3%

EBIT margin 8.2% 5.9% 1.1% 5.2% 5.5%



Productivity ratios


Operating leverage 0.0 0.3 0.8 -3.3 -0.1




Financial ratios

Equity ratio 37.1% 27.3% 33.3% 35.5% 37.0%

Net financial debt (in m EUR) 6.2 32.7 13.0 -1.6 -3.4

Net debt / Equity 6.8% 43.6% 13.7% -1.6% -3.1%

Interest cover > 10 > 10 0.0 0.0 0.0

Net debt / EBITDA 0.17 1.05 0.80 -0.06 -0.11


Change Working Capital (in m EUR) 1.7 11.3 -3.2 -6.8 4.3

WC /sales 28.5% 31.7% 31.1% 31.4% 31.4%






Others




Pay out ratio 38.6% 48.0% 40.0% 40.0% 40.0%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 391 430 495 555 588

EBIT 36 27 38 45 53

EBIT margin 9.2% 6.4% 7.7% 8.0% 9.0%


Free cash-flow 16 -12 -3 11 20

EPS (in EUR) 3.48 4.04 3.11 3.89 4.86

DPS (in EUR) 0.96 1.00 1.05 1.10 1.15

Dividend yield 2.1% 2.4% 2.1% 2.2% 2.3%

EV/Sales 0.8 0.9 0.9 0.8 0.8

EV/EBIT 9.0 14.5 12.2 10.2 8.4



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Schaltbau Holding AG Proven technology – re-initiation of coverage

Proven technology in a stable market environment sums Schaltbau up in a nutshell.

We re-initiate our coverage of the company with a BUY rating and a price target of

€ 55.00.

INVESTMENT CASE

Schaltbau’s business model focuses on niche products with a manageable number of

competitors and top three positions in the global market in all of the major business

units. The sales activities take place in stable markets and are long term in nature.

Nevertheless, it is evident that the markets are often dominated by public-sector

clients, which does not always make the projects straightforward, primarily due to

budgetary restrictions. In addition,

• accelerating market consolidation and

• growing competition from Chinese companies

are among the challenges Schaltbau is facing.

The preliminary results for 2015 showed revenue growth of roughly 15% to € 495 m

(guidance € 485 m). Even though slightly more than half of this growth comes from

new consolidations, roughly 7.5% of growth is organic. For 2015, Schaltbau

anticipates an EBIT of € 37 m (BHLe € 38 m, FactSet consensus € 38.3 m).

CATALYSTS

We expect the 2016 figures to improve further, not least because in addition to

organic improvements, the acquisition of the Spanish Albatros group (revenue:

€ 30 m) will only be included from 2016 onwards.

VALUATION

Our price target is based on a DCF model.

28/01/2016

Buy (n.a. )

55.00 EUR (- EUR )

Close 25/01/2016 50.35 EUR

Bloomberg: SLT GR WKN: 717030

Sector Transport & Logistics




Compared to SDAX

YTD 7.2%

1 month 6.1%

12 months -0.3%

Share data

EV (m EUR; 2016) 455


No. of shares (m) 6

Free float 67.9%



SWOT


• Broadly diversified via subsidiaries

• Increasing demand for public transport infrastructure

• M&A is another option for growth

• Exhibited price discipline when making acquisitions in the past


• Limited growth in niche markets

• Still under-represented in the emerging markets

• Project-related risks


• Dr. Jürgen Cammann (CEO)

• Elisabeth Prigge

• Ralf Klädtke

Schaltbau Holding AG and its subsidiaries develop, manufacture and

distribute high quality components and systems for transportation

technology and for the investment goods industry.


• 2015: revenue of € 485 m

• 2015: EVBIT of ~ € 37 m

• 015: EPS of 2.91

• -



Next event: 10/03/2016 Preliminary Results Familie Dr. Cammann 11.2

Familie Zimmermann 10.6

Monolith N.V. 6.8



5

7

9

11

13

15

17

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

38.9%

40.2%

14.5%

6.3% Germany

Other Europe

China/Hongkong

Other

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 495 555 588



Consensus 37 46 52

EPS (EUR) BHL 3.11 3.89 4.86

Consensus 2.99 4.19 5.09

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 4.3% 5.5% 0.9% -0.6% 2.9%

Capex/Depreciation 1.9 2.1 0.4 -0.3 1.3

ROCE 19.4% 10.6% 14.3% 15.8% 17.3% Free cash flow yield 5.8% -4.6% -0.9% 3.5% 6.4%

Equity ratio 33.4% 31.2% 32.4% 35.3% 38.8%


Interest cover > 10 > 10 > 10 > 10 0.0



Schaltbau Holding AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 391 430 495 555 588

Own work capitalised -1 11 14 14 14

Total sales 390 440 509 569 602





EBITDA 45 38 50 57 66


EBITA 36 27 38 45 53



EBIT 36 27 38 45 53

Financial result -2 8 -4 -4 -4



EBT 34 35 34 41 49

Taxes -9 -6 -9 -11 -13




Net income (adj.) 21 25 19 24 30

No. of shares 6 6 6 6 6

EPS 3.48 4.04 3.11 3.89 4.86


2013 2014 2015e 2016e 2017e

Gross margin 50.8% 48.2% 48.3% 48.5% 48.7%

EBITDA margin 11.5% 8.9% 10.1% 10.3% 11.2%

EBITA margin 9.2% 6.4% 7.7% 8.0% 9.0%

EBIT margin 9.2% 6.4% 7.7% 8.0% 9.0%

EBT margin 8.6% 8.2% 6.9% 7.4% 8.3%


Tax rate 26.6% 17.4% 27.0% 27.0% 27.0%



Sales 7.7% 10.0% 15.2% 12.1% 6.0%

EBITDA 21.8% -15.1% 31.2% 13.6% 15.2%

EBIT 22.0% -24.2% 39.2% 17.2% 18.3%

EBT 29.7% 4.5% -2.4% 19.0% 20.0%

Net income (adj.) 12.6% 16.0% -22.9% 25.0% 25.0%

EPS 12.6% 16.0% -22.9% 25.0% 25.0%


Key figures



Schaltbau Holding AG – Balance sheet


Fixed assets 105 149 154 158 162





Current assets 162 212 217 232 252

Inventories 69 86 96 100 103




Cash 14 26 12 17 31

Total assets 267 361 371 390 415

















Schaltbau Holding AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 39.4% 41.3% 41.6% 40.6% 39.2%



Current assets 60.6% 58.7% 58.4% 59.4% 60.8%

Inventories 25.6% 23.7% 25.8% 25.6% 24.8%


Cash 5.4% 7.1% 3.3% 4.4% 7.4%







Short-term debt 5.0% 3.4% 3.3% 3.2% 3.0%





Schaltbau Holding AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 36 27 19 24 30




Other -4 -3 -1 0 0



Change in accounts receivable 0 0 -8 -6 -4


Change in other working capital positions 5 -13 1 0 0


Capex, excluding maintenance -17 -24 -4 4 -17

Payments for acquisitions -1 -10 -13 -20 0





Free cash-flow 16 -12 -3 11 20



Purchase of own shares 0 -2 -5 0 0

Other financing Cash-flow 0 -7 0 0 0


Cash-flow from financing activities -11 24 -11 -6 -7

Increase/ decrease in liquid assets 6 12 -14 5 14



Change in total cash and cash equivalents 5 13 -14 5 14





Schaltbau Holding AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 3.48 4.04 3.11 3.89 4.86




Valuation ratios

EV/Sales 0.8 0.9 0.9 0.8 0.8

EV/EBITDA 7.2 10.4 9.3 8.0 6.7

EV/EBIT 9.0 14.5 12.2 10.2 8.4



Dividend yield 2.1% 2.4% 2.1% 2.2% 2.3%


EBITDA margin 11.5% 8.9% 10.1% 10.3% 11.2%

EBIT margin 9.2% 6.4% 7.7% 8.0% 9.0%



Productivity ratios






Financial ratios

Equity ratio 33.4% 31.2% 32.4% 35.3% 38.8%


Net debt / Equity 54.7% 70.8% 77.3% 64.0% 46.3%

Interest cover > 10 > 10 > 10 > 10 0.0

Net debt / EBITDA 1.08 2.08 1.85 1.55 1.13


Change Working Capital (in m EUR) -7 21 17 9 6

WC /sales 29.1% 31.3% 30.5% 28.8% 28.1%





Invest. (property/plant/equity) / Depreciation 187.4% 214.7% 35.1% -28.0% 130.8%

Others


EBIT CAGR (last 3 years) 14.9% -0.2% 8.8% 7.3% 24.5%


Pay out ratio 27.6% 24.8% 33.7% 28.3% 23.6%

Free cash-flow (in m EUR) 16 -12 -3 11 20





in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,423 1,336 1,328 1,378 1,465

EBIT -100.0 -48.5 -97.1 0.0 24.5

EBIT margin -7.0% -3.6% -7.3% 0.0% 1.7%


Free cash-flow 47.0 -189.2 -277.6 1.7 -2.8

EPS (in EUR) -3.47 -3.26 -2.68 -0.36 -0.21

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 2.4 1.3 1.7 1.3 1.3

EV/EBIT -34.0 -35.2 -22.8 45,167.5 76.2

Price Earnings ratio (P/E) -8.3 -4.2 -4.8 -24.2 -41.3


Next event

RPC 23/03/2016

Change in model

Sales EBIT EPS

2015e --- --- -1.1%

2016e --- -99.3% 5.9%

2017e --- -10.6% 0.4%

Analyst


Phone: +49 (0)211 4952-313

[email protected]


SGL CARBON SE Weak business with the steel industry

Due to the weak business with graphite electrodes for steel production, SGL Carbon

is still making losses. As a result, we expect the share price to keep falling, and we

reiterate our SELL rating for SGL Carbon.

INVESTMENT CASE

The company’s Performance Products segment, which produces cathodes for the

aluminium industry and graphite electrodes for the steel sector, accounts for

roughly 44% of revenue. Both the demand for and the price of graphite electrodes

are on the decline – selling this segment is therefore likely to be the company’s

favoured strategic option, in our view. The Carbon Fibers and Graphite Specialties

segments offer better growth opportunities. The segments’ revenues of € 788 m

(BHL 2015e) are expected to grow 50% by 2020.

CATALYSTS

• The results press conference on 23 March is likely to focus on restructuring

expenses – and we expect the outlook to project group EBIT at break-even.

• As business keeps getting weaker, further write-downs may also weigh on the

results. We expect the net financial debt (9M 2015: € 520 m) to increase

further, which may lead to non-compliance with loan terms and conditions.

• Speculations about a takeover by SKION (27.5% stake) – alone or together

with BMW (18.4% stake) – should have a positive impact on the share price,

particularly if VW (9.9% stake) parts company with its shareholding.

VALUATION

Our valuation of SGL is based on a DCF model, assuming 5.6% cost of capital and

1% cash-flow growth in the terminal value. This leads us to a fair value of € 7.90.

We have consequently rounded our price target to € 8.00.

28/01/2016

Sell (Sell )

8.00 EUR (9.00 EUR )

Close 25/01/2016 8.81 EUR

Bloomberg: SGL GY WKN: 723530

Sector Chemicals




Compared to SDAX

YTD -23.4%

1 month -26.3%

12 months -51.9%

Share data

EV (m EUR; 2016) 1,850



Free float 37.6%



SWOT


• Important customers include electric steel producers and increasingly

also car makers

• Strong market position as high-quality producer in all of the three

business units

• The age of carbon has only just started in the automotive industry

• Key competences in high-temperature applications.


• Economic downturn and competition from Asia have been a burden

recently

• Speculations on takeover battle could disappear into thin air

• Exit of the GE-business possible - could led to negative one-time effects

• Dependency on needle coke as a raw material and power prices


• Dr. Jürgen Köhler (CEO)

• Dr. Michael Majerus (CFO)

• Dr. Gerd Wingefeld

SGL Carbon SE is one of the world’s leading manufacturers of carbon-based

products. The company’s product portfolio ranges from carbon and graphite

products and carbon fibres to composites.


• adj. EBIT in 2015 slightly below previous year



Next event: 23/03/2016 RPC Skion 27.5

BMW AG 18.4

Volkswagen AG 9.9



0

10

20

30

40

50

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

48%

28%

24%Performance Products

Graphite Specialties

Carbon Fibers & Materials

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,328 1,378 1,465

Consensus 1,320 1,316 1,395

EBIT (in m EUR) BHL -97.1 0.0 24.5

Consensus 28.5 2.0 50.5

EPS (EUR) BHL -2.68 -0.36 -0.21

Consensus -0.46 -0.43 0.06

2013 2014 2015e 2016e 2017e

R&D/Sales 3.0% 2.8% 2.9% 2.8% 2.7%

Capex/Sales 8.2% 9.9% 6.4% 5.8% 5.5%


ROCE -6.2% -2.9% -7.0% 0.0% 1.8% Free cash flow yield 5.8% -18.2% -23.4% 0.2% -0.3%

Equity ratio 30.3% 26.9% 16.3% 14.6% 13.6%

Net debt / Equity 72% 45% 207% 232% 251% Net debt / EBITDA -22.5 8.1 -68.4 7.7 6.0

Interest cover < -10 < -10 < -10 0.0 0.5



SGL CARBON SE – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,423 1,336 1,328 1,378 1,465

Cost of Sales -1,158 -1,115 -1,073 -1,168 -1,202

Gross profit 264.6 221.0 255.5 209.6 262.7




Other operating result -85.0 -25.6 -137.3 1.0 -15.8

EBITDA -20.0 32.9 -9.1 80.0 104.5

Depreciation 80.0 81.4 88.0 80.0 80.0

EBITA -100.0 -48.5 -97.1 0.0 24.5



EBIT -100.0 -48.5 -97.1 0.0 24.5


Income on ordinary activities -161.1 -104.4 -144.6 -48.1 -24.3


EBT -161.1 -104.4 -144.6 -48.1 -24.3

Taxes -91.3 -21.4 -8.0 16.8 6.8

Net income from cont. operations -252.4 -125.8 -152.6 -31.3 -17.5

Net income from discont. operations -60.3 -119.2 -90.0 0.0 0.0


Net income (adj.) -317.0 -247.0 -244.6 -33.3 -19.5

No. of shares 91.4 75.7 91.4 91.4 91.4

EPS (in EUR) -3.47 -3.26 -2.68 -0.36 -0.21


2013 2014 2015e 2016e 2017e

Gross margin 18.6% 16.5% 19.2% 15.2% 17.9%

EBITDA margin -1.4% 2.5% -0.7% 5.8% 7.1%

EBITA margin -7.0% -3.6% -7.3% 0.0% 1.7%

EBIT margin -7.0% -3.6% -7.3% 0.0% 1.7%

EBT margin -11.3% -7.8% -10.9% -3.5% -1.7%

Net profit margin -22.0% -18.3% -18.3% -2.3% -1.2%

Tax rate -56.7% -20.5% -5.5% 35.0% 28.0%



Sales -16.8% -6.1% -0.5% 3.7% 6.3%

EBITDA --- --- --- --- 30.5%

EBIT --- -51.5% >100% --- >100%

EBT --- -35.2% 38.5% -66.7% -49.5%

Net income (adj.) --- -22.1% -1.0% -86.4% -41.4%

EPS --- -6.0% -18.0% -86.4% -41.4%


Key figures



SGL CARBON SE – Balance sheet


Fixed assets 1,089 1,059 1,056 1,056 1,056





Current assets 969.8 1,112 786.7 770.3 768.0

Inventories 478.4 463.3 464.9 454.8 448.3



Securities 6.4 78.2 0.0 0.0 0.0

Cash 235.1 347.5 71.9 75.6 74.8

Total assets 2,059 2,170 1,843 1,826 1,824




Minorities 16.2 17.1 17.1 17.1 17.1

Non-current liabilities 943.8 1,083 1,095 1,107 1,119






Short-term debt 143.6 98.6 100.6 102.6 104.6






SGL CARBON SE – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 52.9% 48.8% 57.3% 57.8% 57.9%



Current assets 47.1% 51.2% 42.7% 42.2% 42.1%

Inventories 23.2% 21.3% 25.2% 24.9% 24.6%


Cash 11.4% 16.0% 3.9% 4.1% 4.1%







Short-term debt 7.0% 4.5% 5.5% 5.6% 5.7%





SGL CARBON SE – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -317.0 -247.0 -244.6 -33.3 -19.5

Depreciation 80.0 81.4 88.0 80.0 80.0



Other 47.0 0.0 0.0 0.0 0.0

Operating Cash-flow before changes in w/c -128.1 -104.1 -143.9 59.8 73.9

Change in inventory 37.4 16.7 -1.6 10.2 6.4

Change in accounts receivable 32.8 12.9 -4.4 10.0 0.0


Change in other working capital positions 86.6 53.9 -7.6 0.0 -5.0

Operating Cash-flow 50.8 -1.9 -152.3 81.7 77.2



Financial investments 115.8 -40.5 -40.0 0.0 0.0




Free cash-flow 47.0 -189.2 -277.6 1.7 -2.8





Dividend paid -14.2 0.0 0.0 0.0 0.0

Cash-flow from financing activities -144.0 259.7 2.0 2.0 2.0









SGL CARBON SE – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -3.47 -3.26 -2.68 -0.36 -0.21


Free Cash-flow per share 0.51 -2.50 -3.04 0.02 -0.03


Valuation ratios

EV/Sales 2.4 1.3 1.7 1.3 1.3

EV/EBITDA -169.8 51.9 -244.1 23.1 17.8

EV/EBIT -34.0 -35.2 -22.8 45,167.5 76.2



Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin -1.4% 2.5% -0.7% 5.8% 7.1%

EBIT margin -7.0% -3.6% -7.3% 0.0% 1.7%

Net return on sales -22.3% -18.5% -18.4% -2.4% -1.3%

Return on capital employed (ROCE) -6.2% -2.9% -7.0% 0.0% 1.8%

Productivity ratios




EBIT per employee 0 0 0 6 3,861


Financial ratios

Equity ratio 30.3% 26.9% 16.3% 14.6% 13.6%


Net debt / Equity 72.1% 45.3% 206.9% 232.0% 251.4%

Interest cover < -10 < -10 < -10 0.0 0.5

Net debt / EBITDA -22.50 8.06 -68.38 7.74 5.95


Change Working Capital (in m EUR) -205.1 -13.8 0.7 -22.0 -8.3

WC /sales 33.5% 34.6% 34.9% 32.0% 29.6%






Others

Sales CAGR (last 3 years) 1.0% -4.6% -8.1% -1.1% 3.1%



Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) 47.0 -189.2 -277.6 1.7 -2.8

Free cash flow yield 1.8% -18.2% -23.5% 0.2% -0.3%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 365.7 430.0 474.0 444.0 452.3

EBIT 20.7 16.6 22.0 19.5 19.8

EBIT margin 5.6% 3.9% 4.7% 4.4% 4.4%


Free cash-flow 0.4 -5.5 -15.0 0.6 7.8

EPS (in EUR) 2.30 1.82 2.52 1.98 1.94

DPS (in EUR) 1.00 1.00 0.80 0.60 0.60

Dividend yield 2.2% 2.7% 3.0% 2.6% 2.6%

EV/Sales 0.8 0.6 0.4 0.4 0.4

EV/EBIT 14.5 15.6 9.6 9.9 9.5



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Christian Ludwig , CFA

Phone: +49 (0)211 4952-126

[email protected]


SHW AG Bet on the future

SHW AG is an automotive supplier specialised in variable oil pumps (>50% of

revenue) and brake discs (~20% of revenue). After two rather disappointing years

without operating leverage, the new CEO, Frank Bosshoff, should put the company

back on track for growth.

INVESTMENT CASE

After a profit warning for 2015 and a weak outlook for 2016, SHW published a new

medium-term guidance in December. By 2020, the company is planning to

• expand the product range to include rotary vane pumps for gearboxes,

• press on with the internationalisation especially in the NAFTA region and

China,

• position itself in the area of electrification of the powertrain via M&A, and

thus,

• increase the revenue from € 630 m to € 660 m with an EBITDA margin of

more than 12%.

However, next on the agenda is a period of consolidation because the loss of two

large orders is set to lead to declining revenues in 2016 and only marginal growth in

2017.

CATALYSTS

The next quarterly reports are likely to be rather disappointing as we expect the

2016 revenues to go down.

VALUATION

Our price target is based on mix of a DCF model, a peer group comparison and a

cash-flow analysis to which we applied an equal weighting. With a PER2015e of

10.7x, SHW appears inexpensive. However, due to rising investments and write-

downs along with declining revenues, we do not expect earnings to grow in the next

two years. Thus, we give the stock as HOLD rating.

28/01/2016

Hold (Hold )

24.00 EUR (24.00 EUR )

Close 25/01/2016 23.00 EUR

Bloomberg: SW1 GY WKN: A1JBPV

Sector Automotive





YTD -5.5%

1 month -10.4%

12 months -37.8%

Share data

EV (m EUR; 2016) 192.9



Free float 100.0%



SWOT


• Products will be required in order to comply with IPO regulations.

• Production is mostly assembly, which does not tie up much capital.

• New management team brings a breath of fresh air.


• Internationalisation is very limited.

• Value-added chain for brake discs has limited depth.

• Large dependence on BMW and VW (>50% of sales).


• Dr. Frank Boshoff (CEO)

• Sascha Rosengart (CFO)

• Andreas Rydzewski

SHW AG is an automotive supplier and manufacturer of engine components

(oil and water pumps, sintered parts) that contribute significantly to the

reduction of fuel consumption and therefore CO2 emissions. In addition, the

company operates its own foundry, which produces up to 5 million brake

discs per year. SHW AG was founded in 1365 and is headquartered in Aalen,

Germany.


• 2015 sales: approx. € 470 m

• 2015 EBITDA: € 42 - 46 m.

• WCap 11% of sales

• 2020 sales: € 630 - 660 m.

• 2018 EBIDTA margin >12%



Next event: 24/02/2016 Preliminary Results Franklin Templeton 18.4

Capital 4.7

UBS 3.5



5

7

9

11

13

15

2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

77.6%

22.4%Pumps & EngineComponents

Braking Discs

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 474.0 444.0 452.3

Consensus 472.0 449.1 458.6

EBIT (in m EUR)

BHL 22.0 19.5 19.8

Consensus 21.7 20.9 23.6

EPS (EUR)

BHL 2.52 1.98 1.94

Consensus 2.48 2.24 2.57

2013 2014 2015e 2016e 2017e

R&D/Sales 2.1% 2.2% 1.5% 1.8% 2.0% Capex/Sales 8.2% 8.3% 7.6% 7.0% 6.5%


ROCE 18.3% 13.0% 12.5% 10.5% 10.4%


Equity ratio 44.1% 40.3% 44.3% 46.6% 48.4%

Net debt / Equity 3% 17% 9% 12% 9%

Net debt / EBITDA 0.1 0.4 0.3 0.4 0.3

Interest cover 0.0 0.0 0.0 0.0 0.0



SHW AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 365.7 430.0 474.0 444.0 452.3

Cost of Sales -323.7 -385.9 -425.7 -397.8 -404.4

Gross profit 42.0 44.1 48.3 46.2 47.9




Other operating result 0.6 -3.0 -1.6 -1.6 -1.7

EBITDA 34.9 34.9 44.0 43.0 44.8

Depreciation 14.2 18.3 22.0 23.5 25.0

EBITA 20.7 16.6 22.0 19.5 19.8



EBIT 20.7 16.6 22.0 19.5 19.8

Financial result -1.7 -1.7 0.2 -2.0 -2.0



EBT 19.0 14.9 22.2 17.5 17.8

Taxes -5.5 -4.2 -6.2 -4.9 -5.5




Net income (adj.) 13.4 10.7 16.0 12.6 12.3

No. of shares 5.9 5.9 6.4 6.4 6.4

EPS (in EUR) 2.30 1.82 2.52 1.98 1.94


2013 2014 2015e 2016e 2017e

Gross margin 11.5% 10.3% 10.2% 10.4% 10.6%

EBITDA margin 9.5% 8.1% 9.3% 9.7% 9.9%

EBITA margin 5.6% 3.9% 4.7% 4.4% 4.4%

EBIT margin 5.6% 3.9% 4.7% 4.4% 4.4%

EBT margin 5.2% 3.5% 4.7% 3.9% 3.9%


Tax rate 29.1% 28.2% 28.0% 28.0% 31.0%



Sales 12.4% 17.6% 10.2% -6.3% 1.9%

EBITDA 7.5% 0.1% 26.3% -2.4% 4.3%

EBIT -7.5% -19.7% 33.0% -11.7% 1.9%

EBT -7.6% -21.6% 49.6% -21.4% 2.1%

Net income (adj.) -71.0% -20.6% 50.1% -21.4% -2.1%

EPS -71.0% -20.6% 38.0% -21.4% -2.1%


Key figures



SHW AG – Balance sheet


Fixed assets 99.7 119.0 142.1 155.8 160.3





Current assets 87.6 90.5 125.9 115.2 117.8

Inventories 39.2 42.4 51.9 48.7 49.6



Securities 0.0 0.0 0.0 0.0 0.0

Cash 2.8 0.3 18.4 14.5 15.3

Total assets 187.3 209.5 268.0 270.9 278.1




Minorities 0.0 0.0 0.0 0.0 0.0







Short-term debt 2.0 9.6 9.6 8.2 6.9






SHW AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 53.2% 56.8% 53.0% 57.5% 57.6%



Current assets 46.8% 43.2% 47.0% 42.5% 42.3%

Inventories 20.9% 20.2% 19.4% 18.0% 17.8%


Cash 1.5% 0.1% 6.9% 5.4% 5.5%







Short-term debt 1.1% 4.6% 3.6% 3.0% 2.5%





SHW AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 13.4 10.7 16.0 12.6 12.3

Depreciation 14.2 18.3 22.0 23.5 25.0



Other 0.9 -5.4 -0.4 0.3 -0.1


Change in inventory 4.9 -3.2 -9.6 3.3 -0.9

Change in accounts receivable -10.5 -2.6 -7.3 3.3 -0.9

Change in accounts payable 9.6 8.3 6.2 -3.9 1.1

Change in other working capital positions 0.0 -0.9 1.2 -0.8 -0.1



Payments for acquisitions 0.0 0.0 -8.5 -6.5 0.0





Free cash-flow 0.4 -5.5 -15.0 0.6 7.8


Increase/decrease in debt position 5.7 8.9 15.0 0.6 -3.2



Dividend paid -23.4 -5.9 -5.9 -5.1 -3.8

Cash-flow from financing activities -17.8 3.0 33.1 -4.5 -7.0

Increase/ decrease in liquid assets -17.3 -2.5 18.1 -3.9 0.7



Change in total cash and cash equivalents -16.8 -2.5 18.1 -3.9 0.7





SHW AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 2.30 1.82 2.52 1.98 1.94




Valuation ratios

EV/Sales 0.8 0.6 0.4 0.4 0.4

EV/EBITDA 8.6 7.4 4.8 4.5 4.2

EV/EBIT 14.5 15.6 9.6 9.9 9.5



Dividend yield 2.2% 2.7% 3.0% 2.6% 2.6%


EBITDA margin 9.5% 8.1% 9.3% 9.7% 9.9%

EBIT margin 5.6% 3.9% 4.7% 4.4% 4.4%



Productivity ratios






Financial ratios

Equity ratio 44.1% 40.3% 44.3% 46.6% 48.4%


Net debt / Equity 3.5% 16.9% 9.4% 12.4% 8.7%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 0.08 0.41 0.25 0.36 0.26


Change Working Capital (in m EUR) -2.9 -2.5 10.7 -2.6 0.7

WC /sales 9.1% 7.2% 8.8% 8.8% 8.8%






Others



Net income CAGR (last 3 years) 65.5% 8.9% -29.8% -2.2% 4.9%

Pay out ratio 43.5% 54.8% 31.8% 30.3% 31.0%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 135 145 142 170 170

EBIT -19 8 4 9 12

EBIT margin -14.4% 5.8% 3.0% 5.5% 6.9%



EPS (in EUR) -0.85 0.24 0.13 0.31 0.39

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 0.7 0.4 0.9 0.8 0.7

EV/EBIT -4.6 6.6 28.5 14.1 10.6



Next event

RPC 24/03/2016

Change in model

Sales EBIT EPS

2015e 1.4% 33.7% 38.0%

2016e 13.3% 44.6% 47.2%

2017e 6.3% 20.4% 21.2%

Analyst


Phone: +49 (0)211 4952-351

[email protected]


SÜSS MicroTec AG Dream start

Since about mid-2015, SÜSS MicroTec has been generating surprisingly positive

newsflow. This was an opportune moment for the company’s new management

team to take office. However, it remains to be seen whether or not the latest

turnaround will be sustainable, in our view.

INVESTMENT CASE

SÜSS recently surprised the markets with a strong order intake. After stagnating at

between € 25 m and € 40 m for many quarters, the company now expects the order

intake to grow to € 79.8 m in Q4, the strongest ever in its history. This is due to new

investments in the Advanced Packaging business. The company is therefore defying

weakness in the sector overall. We have raised our estimates to take account of this

trend.

CATALYSTS

• We do not expect the preliminary figures to throw up any surprises on

11 February. Consensus estimates already anticipate a positive outlook for the

full year, in our view. The company's order intake expectations for Q1 are likely to

move into the spotlight. They should indicate whether or not the strong order

intake achieved in Q4 is merely due to pull-forward effects or if the trend is

sustainable.

• As the semiconductor industry has been experiencing a moderate downturn since

mid-2015, we believe SÜSS should soon benefit from cyclical tailwinds. However,

this is unlikely to happen before H2 2016.

VALUATION

Our DCF-based price target has risen from € 6.00 to € 8.00 as we have increased

our estimates. This corresponds to a PER2017e of about 20x, in line with historical

valuation levels.

28/01/2016

Hold (Hold )

8.00 EUR (6.00 EUR )

Close 25/01/2016 8.47 EUR

Bloomberg: SMHN:GR WKN: A1K023

Sector Technology





YTD 10.5%

1 month 10.3%

12 months 82.7%

Share data

EV (m EUR; 2016) 132



Free float 100.0%



SWOT


• Niche player with good market position

• Strong management

• Ongoing MEMS market growth

• 3D packaging is the new growth driver

• Larger product range through Tamarack acquisition


• Ongoing losses in the Bonder division

• The company is small compared to most of its customers

• Cyclical semiconductor market


• Per-Ove Hansson (CEO)

• Michael Knopp (CFO)

SÜSS MicroTec AG makes systems that are used in the production of MEMS

sensors and in the packaging of semiconductor chips. The company’s biggest

customers include packaging foundries, such as Amkor, ASE and the Asian-

based firm Spil. The company’s biggest competitors are EV Group, Tokyo

Electron and Ultratech.


• Revenues of € 135-145 m in 2015

• Slightly positive EBIT in 2015

• -



Next event: 24/03/2016 RPC DWS 8.7

Credit Suisse 3.4

Blackrock 3.2



0

10

20

30

40

50

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

69.1%

16.0%

14.8% 0.1%Lithography

Substrate Bonder

Photomask Equipment

Unallocated Assets

Company Overview

2015e 2016e 2017e

Sales (in € m) BHL 142 170 170


EBIT (in Mio. EUR) BHL 4 9 12

Consensus 3 11 15

EPS (EUR)

BHL 0.13 0.31 0.39

Consensus 0.08 0.38 0.54

2013 2014 2015e 2016e 2017e



ROCE -15.6% 6.4% 3.2% 6.7% 8.0% Free cash flow yield 5.8% 4.1% 3.8% - -

Equity ratio 60.7% 69.1% 68.6% 69.2% 70.4%

Net debt / Equity -33% -33% -36% -28% -32%

Net debt / EBITDA 3.6 -2.7 -4.2 -2.5 -2.6

Interest cover < -10 0.0 > 10 0.0 0.0



SÜSS MicroTec AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 135 145 142 170 170

Cost of Sales -113 -97 -94 -116 -112





Other operating result 1 2 0 0 0

EBITDA -10 14 10 14 16


EBITA -16 10 6 9 12



EBIT -19 8 4 9 12

Financial result 0 0 0 0 0

Income on ordinary activities -20 8 4 9 12


EBT -20 8 4 9 12

Taxes 4 -4 -1 -3 -4

Net income from cont. operations -16 5 3 6 7



Net income (adj.) -16 5 3 6 7

No. of shares 19 19 19 19 19

EPS (in EUR) -0.85 0.24 0.13 0.31 0.39


2013 2014 2015e 2016e 2017e

Gross margin 16.2% 33.6% 34.0% 32.0% 34.0%

EBITDA margin -7.4% 9.7% 7.1% 8.0% 9.4%

EBITA margin -11.9% 6.8% 4.1% 5.5% 6.9%

EBIT margin -14.4% 5.8% 3.0% 5.5% 6.9%

EBT margin -14.5% 5.6% 2.8% 5.3% 6.8%


Tax rate 18.3% 43.7% 35.0% 35.0% 35.0%



Sales -17.9% 8.0% -2.3% 19.7% 0.0%

EBITDA --- --- -29.3% 35.8% 17.6%

EBIT --- --- -49.0% >100% 25.5%

EBT --- --- -51.6% >100% 26.6%

Net income (adj.) --- --- -44.4% >100% 26.7%

EPS --- --- -45.0% >100% 26.7%


Key figures



SÜSS MicroTec AG – Balance sheet







Current assets 133 123 128 135 142





Cash 45 47 51 44 51

Total assets 180 168 173 180 188

















SÜSS MicroTec AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 26.1% 26.6% 26.0% 25.1% 24.3%



Current assets 73.9% 73.4% 74.0% 74.9% 75.7%

Inventories 39.5% 35.1% 34.2% 39.3% 37.8%


Cash 25.1% 28.2% 29.7% 24.3% 27.2%







Short-term debt 0.7% 0.7% 0.7% 0.7% 0.6%





SÜSS MicroTec AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -16 5 3 6 7



Change of provisions 15 -16 0 0 0

Other 0 0 0 0 0

Operating Cash-flow before changes in w/c 9 -5 8 10 12

Change in inventory 11 12 0 -12 0

Change in accounts receivable 11 -2 0 -3 0

Change in accounts payable -1 -2 2 1 0

Change in other working capital positions -13 3 -1 0 0

Operating Cash-flow 16 5 9 -3 12









Increase/decrease in debt position 7 -1 0 0 0


Other financing Cash-flow -7 1 0 0 0



Increase/ decrease in liquid assets 6 4 4 -8 7



Change in total cash and cash equivalents 6 4 4 -8 7





SÜSS MicroTec AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.85 0.24 0.13 0.31 0.39


Free Cash-flow per share 0.32 0.23 0.21 -0.40 0.38


Valuation ratios

EV/Sales 0.7 0.4 0.9 0.8 0.7

EV/EBITDA -9.1 3.9 12.2 9.7 7.8

EV/EBIT -4.6 6.6 28.5 14.1 10.6



Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin -7.4% 9.7% 7.1% 8.0% 9.4%

EBIT margin -14.4% 5.8% 3.0% 5.5% 6.9%


Return on capital employed (ROCE) -15.6% 6.4% 3.2% 6.7% 8.0%

Productivity ratios


Operating leverage 2.7 1.4 0.5 -1.2 -0.3




Financial ratios

Equity ratio 60.7% 69.1% 68.6% 69.2% 70.4%


Net debt / Equity -32.8% -32.8% -35.5% -27.7% -31.6%

Interest cover < -10 0.0 > 10 0.0 0.0

Net debt / EBITDA 3.60 -2.69 -4.21 -2.54 -2.61


Change Working Capital (in m EUR) -20 -8 -2 13 0

WC /sales 57.0% 47.4% 47.2% 47.2% 47.2%






Others


EBIT CAGR (last 3 years) -210.7% -23.3% -28.6% -178.5% 12.0%


Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) 6 4 4 -8 7

Free cash flow yield 4.9% 4.9% 2.6% -4.7% 4.4%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 105 112 124 138 150

EBIT 5 7 9 12 14

EBIT margin 4.4% 6.1% 7.5% 8.5% 9.6%


Free cash-flow -3 5 6 6 8

EPS (in EUR) 0.47 0.67 0.93 1.18 1.48

DPS (in EUR) 0.20 0.33 0.46 0.59 0.74

Dividend yield 2.6% 3.6% 2.4% 3.4% 4.3%

EV/Sales 0.5 0.5 0.9 0.7 0.6

EV/EBIT 10.6 8.1 12.6 8.6 6.7



Next event

RPC 08/03/2016

Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-455

[email protected]


technotrans AG 50% EPS growth from 2015 to 2017 expected

We expect technotrans to increase its EPS by ~ 50% in the period from 2015 to

2017, primarily driven by its activities outside the printing industry, which have

performed well in the last few years. With a strong balance sheet there is also room

for further growth through acquisitions.

INVESTMENT CASE

Given the crisis in the printing industry, technotrans has been successful developing

new business activities. These new activities are based on technologies, which

technotrans acquired as a supplier of printing press manufacturers and include e.g.

cooling systems for laser, large batteries as well as medical and scanner

technologies. Further customer industries now also include stamping and forming

technologies as well as the machine tools industry. Technotrans generated around

35% (BHLe) of its 2015 revenues outside the printing industry. Given the company’s

track record and its project pipeline, we are very optimistic about the business

outside the printing industry. We believe that the share of this business will grow to

50% by 2017. We expect the business volume with the printing industry to remain

at least stable. For the period 2015-2017, we expect an EPS growth of about 50%.

CATALYSTS

• For 2016, we expect a boost to revenues from three larger projects including a

project with a leading manufacturer from the semiconductor industry.

• technotrans has a solid balance sheet. In the last three years, the company has

completed two very good acquisitions, in our view.

• Positive impetus from the leading trade fair of the printing industry (drupa) this

year

• Acquisition of new customers in the new technology areas

VALUATION

We analyse the share based on a DCF model with a price target of € 20.00. The

supposedly relatively high valuation multiples (2016 PER: ~16x) are put into

perspective by the EPS growth expected by us. We reiterate our BUY rating.

28/01/2016

Buy (Buy )

20.00 EUR (20.00 EUR )

Close 25/01/2016 17.26 EUR

Bloomberg: TTR1 GY WKN: A0XYGA

Sector Consumer





YTD -1.6%

1 month -1.7%

12 months 88.1%

Share data

EV (m EUR; 2016) 100


No. of shares (m) 6

Free float 94.4%



SWOT


• High-level of engineering expertise, strong reputation

• Revenue share of high-margin Service revenues of ~40%

• Solid balance sheet (equity ratio ~55%)

• Know-how transfer to new industries (outside the printing industry)

• Growth through acquisitions outside the printing machine industry


• High revenue share of printing machine manufacturers; no growth

potential in this segment

• Large acquisition may be received sceptically by market

• Risk of a holding discount

• Process from innovation to serial production often lengthy


• Henry Brickenkamp (CEO)

• Dirk Engel (CFO)

• Dr. Christof Soest (CTO)

technotrans AG is an engineering company specialising in fluid technologies with

core competencies in temperature control, filtration and separation, measuring

and dispensing technology, and process control. In 2014, around 60% of revenues

were generated with the printing machine industry with a market share of more

than 60% (BHLe). Since 2010, technotrans has been transferring its know-how to

other industries to generate new growth prospects. This includes machine-tool

engineering, battery cooling and laser technology – a segment that was recently

strengthened through two acquisitions.


• 2015 revenues: slightly above € 120 m

• 2015 EBIT margin slightly above 7.3%

• 2017 revenues of € 150 m with 50% Print share



Next event: 08/03/2016 RPC Treasury shares 6.6

Lazard Feres Gestion 5.3

Teslin Capital Management 3.0



579

1113151719

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

65.6%

34.4% Technology

Services

Company Overview

2015e 2016e 2017e

Sales (in m EUR) BHL 124 138 150



Consensus 9 11 14

EPS (EUR) BHL 0.93 1.18 1.48

Consensus 0.92 1.16 1.42

2013 2014 2015e 2016e 2017e



ROCE 7.9% 11.6% 15.6% 19.0% 22.1% Free cash flow yield -6.9% 8.0% 5.8% 6.0% 8.0%

Equity ratio 59.9% 63.7% 66.9% 69.9% 72.1%


Interest cover > 10 0.0 0.0 0.0 0.0



technotrans AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 105 112 124 138 150

Cost of Sales -72 -75 -82 -90 -99






EBITDA 8 10 13 15 18


EBITA 6 8 11 13 16



EBIT 5 7 9 12 14




EBT 4 6 9 11 14

Taxes -1 -2 -3 -3 -4





No. of shares 6 6 6 6 6

EPS (in EUR) 0.47 0.67 0.93 1.18 1.48


2013 2014 2015e 2016e 2017e

Gross margin 31.5% 33.3% 33.7% 34.2% 34.3%

EBITDA margin 7.4% 8.8% 10.2% 10.9% 11.8%

EBITA margin 5.6% 7.2% 8.8% 9.6% 10.7%

EBIT margin 4.4% 6.1% 7.5% 8.5% 9.6%

EBT margin 3.6% 5.6% 7.1% 8.1% 9.2%


Tax rate 21.0% 29.5% 30.0% 30.0% 30.0%



Sales 16.0% 6.8% 10.1% 11.1% 9.1%

EBITDA -6.1% 26.4% 28.0% 18.7% 18.3%

EBIT -13.6% 47.6% 36.1% 25.4% 23.5%

EBT -20.1% 67.5% 39.4% 27.1% 24.7%

Net income (adj.) -2.5% 45.3% 37.2% 27.5% 25.1%

EPS -3.0% 44.6% 37.2% 27.5% 25.1%


Key figures



technotrans AG – Balance sheet












Cash 17 17 18 18 20

Total assets 73 75 77 80 86

















technotrans AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 40.8% 36.1% 34.1% 32.2% 30.0%



Current assets 59.2% 63.9% 65.9% 67.8% 70.0%

Inventories 19.6% 20.7% 22.1% 23.5% 24.0%


Cash 22.9% 23.1% 23.2% 22.3% 23.7%







Short-term debt 4.5% 4.4% 4.3% 4.1% 3.8%





technotrans AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e





Other 0 2 0 0 0


Change in inventory 1 -1 -2 -2 -2



Change in other working capital positions -1 0 0 0 0








Free cash-flow -3 5 6 6 8


Increase/decrease in debt position 2 -3 -3 -3 -2




Cash-flow from financing activities 2 -5 -5 -6 -6

Increase/ decrease in liquid assets -2 0 1 0 2



Change in total cash and cash equivalents -2 1 1 0 2





technotrans AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.47 0.67 0.93 1.18 1.48




Valuation ratios

EV/Sales 0.5 0.5 0.9 0.7 0.6

EV/EBITDA 6.3 5.6 9.3 6.7 5.4

EV/EBIT 10.6 8.1 12.6 8.6 6.7



Dividend yield 2.6% 3.6% 2.4% 3.4% 4.3%


EBITDA margin 7.4% 8.8% 10.2% 10.9% 11.8%

EBIT margin 4.4% 6.1% 7.5% 8.5% 9.6%



Productivity ratios


Operating leverage 0.1 -0.5 -0.4 -0.3 -0.2




Financial ratios

Equity ratio 59.9% 63.7% 66.9% 69.9% 72.1%


Net debt / Equity -4.1% -11.8% -18.3% -22.5% -27.5%

Interest cover > 10 0.0 0.0 0.0 0.0

Net debt / EBITDA -0.23 -0.57 -0.75 -0.84 -0.96



WC /sales 19.6% 21.1% 20.5% 20.5% 20.5%






Others




Pay out ratio 42.9% 48.9% 50.0% 50.0% 50.0%

Free cash-flow (in m EUR) -3 5 6 6 8





in m EUR 2013 2014 2015e 2016e 2017e

Sales 907 932 945 973 1,003

EBITDA 64 84 60 84 99

EBITDA margin 7.1% 9.0% 6.4% 8.7% 9.9%


Free cash-flow 21 32 -3 14 18

EPS (in EUR) -0.87 0.28 -0.38 0.22 0.58

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 0.7 0.6 0.4 0.3 0.3

EV/EBITDA 9.8 6.2 5.8 3.8 3.0



Next event


Change in model

Sales EBITDA EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


TOM TAILOR Holding AG Earnings improvement stagnating

We stick to our neutral view on the stock and reiterate our HOLD rating with an

unchanged price target of € 5.50 ahead of the release of the 2015 results.

INVESTMENT CASE

Despite the weakness of the fashion sector in Germany at the end of the year, we

expect that Tom Tailor has nearly reached the lower end of its guidance range

(€ 75-80 m), which was adjusted in September, with an adjusted EBITDA of

€ 74.6 m.

The main focus of investors is, in our view, on whether there needs to be a write-

down of goodwill for Bonita after disappointing quarters. However, this would

change the group’s balance sheet structure and may entail consequences relating to

the covenants. In September, Tom Tailor already had to inform the financing banks,

that it was not able to meet the financial covenants, which had required smaller

adjustments of the consortium agreement at the time.

Strategically, Tom Tailor has to focus on increasing the efficiency at all levels of the

value chain in order to stay competitive in the long term. The restructuring

programme “Core”, just launched in the autumn of 2015, has obviously not

generated any visible success yet.

CATALYSTS

Tom Tailor is set to release its 2015 annual report and a guidance for the current

year on 17 March. In view of the market environment and the restructuring

expenses, we maintain a cautious view. We anticipate the preliminary results in

mid-February.

VALUATION

The stock is currently trading at an EV/sales multiple of 0.3x, which we regard as

inexpensive. However, the current valuation is significantly overshadowed by the

uncertainties.

28/01/2016

Hold (Hold )

5.50 EUR (5.50 EUR )

Close 22/01/2016 4.62 EUR

Bloomberg: TTI GY WKN: A0STST

Sector Consumer





YTD -2.3%

1 month 5.9%

12 months -49.9%

Share data

EV (m EUR; 2016) 321



Free float 76.8%



SWOT


• Scalability should permit appreciable margin growth

• Multi-brand approach in complementary segments

• Focus on organic growth with selected acquisitions in the medium term

• Expansion of e-commerce business offers growth potential


• Expansion of retail business changes fixed-cost structure

• Strong competitive pressure in many segments

• Bonita not yet on track for long term growth


• Dieter Holzer (CEO)

• Dr. Axel Rebien (CFO)

• Dr. Heiko Schäfer (COO)

The TOM TAILOR Group is one of the leading fashion and lifestyle houses in

Europe. With its two brands, TOM TAILOR and BONITA, the group offers

trendy apparel and accessories to target groups between 0 and 60 years.


• 2015 revenue € 945-955 m

• 2015 operating EBITDA € 75-80 m

• Reduction of net debt/EBITDA to ~2.0x

• Equity ratio of at least 30%



Next event: 17/03/2016 Analyst conference Fosun International 23.2

Farringdon 10.2

European Assets Management 4.8



5

10

15

20

2011 2012 2013 2014 2015PER AVG STD + 1 STD - 1

64.4%

35.6% Retail

Wholesale

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 945 973 1,003

Consensus 950 976 1,014

EBITDA (in m EUR) BHL 60 84 99

Consensus 65 76 87

EPS (EUR) BHL -0.38 0.22 0.58

Consensus 0.28 0.42 0.58

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 3.0% 2.3% 4.0% 5.1% 4.7%


ROCE 1.3% 6.9% 1.6% 6.5% 9.3% Free cash flow yield 5.1% 10.2% -2.3% 10.8% 14.3%

Equity ratio 29.2% 30.3% 30.1% 30.7% 32.4%


Interest cover 0.4 > 10 0.4 > 10 > 10



TOM TAILOR Holding AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 907 932 945 973 1,003


Total sales 907 932 945 973 1,003





EBITDA 64 84 60 84 99


EBITA 6 33 7 29 42



EBIT 6 33 7 29 42


Income on ordinary activities -12 16 -9 13 27


EBT -12 16 -9 13 27

Taxes -4 -5 3 -4 -8

Net income from cont. operations -16 11 -6 9 19



Net income (adj.) -21 7 -10 6 15

No. of shares 25 26 26 26 26

EPS -0.87 0.28 -0.38 0.22 0.58


2013 2014 2015e 2016e 2017e

Gross margin 55.0% 57.0% 56.0% 56.0% 57.0%

EBITDA margin 7.1% 9.0% 6.4% 8.7% 9.9%

EBITA margin 0.7% 3.6% 0.8% 3.0% 4.2%

EBIT margin 0.7% 3.6% 0.8% 3.0% 4.2%

EBT margin -1.3% 1.7% -1.0% 1.4% 2.7%

Net profit margin -2.3% 0.8% -1.0% 0.6% 1.5%

Tax rate -37.1% 31.9% 31.0% 31.0% 31.0%



Sales 44.1% 2.7% 1.4% 3.0% 3.0%

EBITDA 16.6% 31.4% -28.4% 39.6% 18.1%

EBIT -60.2% >100% -78.0% >100% 45.3%

EBT --- --- --- --- >100%

Net income (adj.) --- --- --- --- >100%

EPS --- --- --- --- >100%


Key figures



TOM TAILOR Holding AG – Balance sheet


Fixed assets 507 487 472 467 457





Current assets 252 302 289 300 315

Inventories 138 166 165 170 175




Cash 47 37 17 21 29

Total assets 760 789 761 767 772

















TOM TAILOR Holding AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 66.8% 61.8% 62.0% 60.9% 59.2%



Current assets 33.2% 38.2% 38.0% 39.1% 40.8%

Inventories 18.1% 21.0% 21.7% 22.2% 22.7%


Cash 6.2% 4.7% 2.2% 2.7% 3.7%







Short-term debt 3.5% 3.8% 4.1% 4.0% 4.0%





TOM TAILOR Holding AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -21 7 -10 6 15




Other -1 29 0 0 0


Change in inventory -14 -28 1 -5 -5


Change in accounts payable 19 32 -4 10 0

Change in other working capital positions 5 -25 -12 0 0



Payments for acquisitions 0 -6 0 0 0





Free cash-flow 21 32 -3 14 18


Increase/decrease in debt position -53 -36 -14 -10 -10





Increase/ decrease in liquid assets -6 -10 -20 4 8



Change in total cash and cash equivalents -6 -10 -20 4 8





TOM TAILOR Holding AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.87 0.28 -0.38 0.22 0.58




Valuation ratios

EV/Sales 0.7 0.6 0.4 0.3 0.3

EV/EBITDA 9.8 6.2 5.8 3.8 3.0

EV/EBITDA 97.7 15.6 47.9 11.0 7.1



Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin 7.1% 9.0% 6.4% 8.7% 9.9%

EBIT margin 0.7% 3.6% 0.8% 3.0% 4.2%

Net return on sales -2.3% 0.8% -1.0% 0.6% 1.5%


Productivity ratios


Operating leverage 0.6 -4.1 0.8 -3.0 -0.5




Financial ratios

Equity ratio 29.2% 30.3% 30.1% 30.7% 32.4%


Net debt / Equity 98.5% 84.8% 91.1% 83.0% 70.8%

Interest cover 0.4 > 10 0.4 > 10 > 10

Net debt / EBITDA 3.41 2.41 3.46 2.32 1.78


Change Working Capital (in m EUR) -8 0 11 -3 7

WC /sales 8.1% 7.9% 9.0% 8.4% 8.9%






Others


EBIT CAGR (last 3 years) -3.0% 16.8% -23.3% 65.4% 8.5%


Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) 21 32 -3 14 18





in m EUR 2013 2014 2015e 2016e 2017e

Sales 151 161 105 115 130

EBIT 20 17 -7 -3 11

EBIT margin 13.2% 10.8% -6.3% -2.2% 8.5%

Net financial debt 12 29 -51 -53 -65


EPS (in EUR) 0.21 -0.06 0.81 -0.06 0.14

DPS (in EUR) 0.06 0.06 0.00 0.00 0.05

Dividend yield 1.4% 1.6% 0.0% 0.0% 1.6%

EV/Sales 1.6 1.6 1.5 1.1 0.9

EV/EBIT 12.3 14.4 -23.5 -51.7 10.6

Price Earnings ratio (P/E) 21.2 -60.1 4.4 -55.3 22.5


Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Tomorrow Focus AG Focus on travel

Thanks to the divestments made in the last few quarters, Tomorrow Focus is a debt-

free company today with a focus on travel and tourism. Our rating remains HOLD

with a price target of € 3.90.

INVESTMENT CASE

In operational terms, the company is now focused on HolidayCheck, meteovista,

MietwagenCheck and Zoover. We firmly believe that the adjusted marketing

strategy was one of the reasons why business accelerated in Q3 2015. For example,

when Google significantly upped the prices of its auction-based AdWords offering,

HolidayCheck increasingly used vouchers to boost business. A flexible marketing

strategy will therefore remain the key to customer growth.

Part of the cash inflow of close to € 80 m from divestments will be used to boost

product and marketing spend. In addition, TFA is clearly looking into M&A options.

In terms of product enhancement, we see three important items on the company’s

current to-do list:

• Optimise NextGen on the HolidayCheck platform, spice up all channels with

new, innovative features

• Continue the 2.0 release for the big data platform

• Start the NextGen front-end for Zover

CATALYSTS

The new CEO, Georg Hesse, who previously worked for Amazon, took office on

01/01/2016. However, it would be unrealistic to expect major strategic changes in

the first 100 days that could lead us to change our view on the stock.

VALUATION

For 2017, we predict net liquidity of € 65 m. We also believe an EBIT multiple of 15x

to be fair. This leads us to a price target of € 3.90.

28/01/2016

Hold (Hold )

3.90 EUR (3.90 EUR )

Close 25/01/2016 3.13 EUR

Bloomberg: TFA GY WKN: 549532

Sector Media




Compared to TecDAX

YTD -4.0%

1 month -3.6%

12 months -27.9%

Share data

EV (m EUR; 2016) 129



Free float 41.2%



SWOT


• Following the disposals, TFA today is concentrating on travel

• Travel also undergoing structural shift from offline to online

• HolidayCheck is posting growth and should be enhanced by further

acquisitions


• Economic downturn will lead to fewer bookings in Travel business

• Marketing measures must be designed flexibly depending on competition

• Must always have state-of-the-art technology


• Georg Hesse (CEO)

• Dr. Dirk Schmelzer (CFO)

Tomorrow Focus AG operates in the online travel business.


• 2015: Sales revenue percentage growth in the mid-to-high single digits

• 2015: At least breakeven operating group EBITDA

•



Next event: 22/03/2016 Preliminary Results Burda 58.8

Deutsche Asset & Wealth Management 8.5

AGI 3.3



5

15

25

35

45

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

59.3%20.9%

19.8%Transactions

Adverising

Technologies

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 105 115 130


EBIT (in m EUR)

BHL -7 -3 11

Consensus -1 6 13

EPS (EUR) BHL 0.81 -0.06 0.14

Consensus -0.05 0.06 0.14

2013 2014 2015e 2016e 2017e

R&D/Sales - - - - -

Capex/Sales 7.2% 10.6% -36.2% 0.6% 0.1%

Capex/Depreciation 1.2 2.1 -76.0 1.4 0.3

ROCE 9.7% 9.1% 0.0% 0.0% 7.8%


Equity ratio 52.1% 53.7% 75.3% 74.9% 75.8%

Net debt / Equity 9% 23% -30% -32% -38% Net debt / EBITDA 0.4 1.1 510.2 -17.5 -4.1

Interest cover > 10 > 10 < -10 < -10 0.0



Tomorrow Focus AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 151 161 105 115 130


Total sales 154 166 110 120 133



Unusual or infrequent items 0 0 -6 -3 0


EBITDA 29 26 0 3 16


EBITA 20 17 -1 3 16



EBIT 20 17 -7 -3 11

Financial result -5 -4 -2 0 0

Income on ordinary activities 15 14 -8 -3 11


EBT 15 14 -8 -3 11

Taxes -3 -3 -1 -1 -3

Net income from cont. operations 12 11 -9 -3 8

Net income from discont. operations 0 -14 56 0 0


Net income (adj.) 12 -4 47 -3 8

No. of shares 58 58 58 58 58

EPS 0.21 -0.06 0.81 -0.06 0.14


2013 2014 2015e 2016e 2017e

Gross margin 87.3% 87.1% 90.5% 90.4% 91.5%

EBITDA margin 19.4% 15.8% -0.1% 2.6% 12.3%

EBITA margin 13.2% 10.8% -0.6% 2.2% 11.9%

EBIT margin 13.2% 10.8% -6.3% -2.2% 8.5%

EBT margin 10.0% 8.6% -7.7% -2.3% 8.3%

Net profit margin 7.9% -2.3% 44.9% -2.9% 6.2%

Tax rate 17.7% 23.4% -12.3% -22.2% 25.0%



Sales 1.3% 6.9% -35.0% 9.5% 13.0%

EBITDA 4.2% -12.6% --- --- >100%

EBIT -0.4% -12.3% --- -62.1% ---

EBT -3.7% -8.0% --- -66.7% ---

Net income (adj.) -18.5% --- --- --- ---

EPS -19.2% --- --- --- ---


Key figures



Tomorrow Focus AG – Balance sheet


Fixed assets 193 178 133 128 123










Cash 26 27 66 67 80

Total assets 255 234 225 221 229

















Tomorrow Focus AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 75.7% 75.9% 59.2% 58.0% 53.8%



Current assets 24.3% 24.1% 40.8% 42.0% 46.2%

Inventories 0.0% 0.0% 0.0% 0.0% 0.0%


Cash 10.2% 11.4% 29.2% 30.3% 34.9%







Short-term debt 0.5% 0.4% 6.5% 6.6% 6.3%





Tomorrow Focus AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 12 -4 47 -3 8



Change of provisions 0 1 -3 0 0

Other -5 11 0 0 0


Change in inventory 0 0 0 0 0

Change in accounts receivable 2 1 0 0 0

Change in accounts payable -4 -3 -4 0 0

Change in other working capital positions 4 9 -2 0 0


Capex, excluding maintenance -11 -17 38 -1 0

Payments for acquisitions -2 0 0 0 0




Cash-flow from investing activities -11 -18 38 -1 0



Increase/decrease in debt position -1 17 -41 0 0



Dividend paid -3 -3 -3 0 0

Cash-flow from financing activities -5 -5 -44 0 0









Tomorrow Focus AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.21 -0.06 0.81 -0.06 0.14




Valuation ratios

EV/Sales 1.6 1.6 1.5 1.1 0.9

EV/EBITDA 8.3 9.8 -1,550.9 43.1 7.3

EV/EBIT 12.3 14.4 -23.5 -51.7 10.6

Price Earnings ratio (P/E) 21.2 -60.1 4.4 -55.3 22.5


Dividend yield 1.4% 1.6% 0.0% 0.0% 1.6%


EBITDA margin 19.4% 15.8% -0.1% 2.6% 12.3%

EBIT margin 13.2% 10.8% -6.3% -2.2% 8.5%

Net return on sales 7.9% -2.3% 44.9% -2.9% 6.2%


Productivity ratios




EBIT per employee 27,429 24,986 0 0 12,291


Financial ratios

Equity ratio 52.1% 53.7% 75.3% 74.9% 75.8%

Net financial debt (in m EUR) 12 29 -51 -53 -65

Net debt / Equity 9.1% 22.9% -30.2% -31.7% -37.6%

Interest cover > 10 > 10 < -10 < -10 0.0

Net debt / EBITDA 0.41 1.12 510.25 -17.51 -4.09



WC /sales 8.0% 8.6% 17.2% 15.7% 13.9%





Invest. (property/plant/equity) / Depreciation 115.4% 209.5% -7600.2% 140.0% 31.0%

Others



Net income CAGR (last 3 years) 1.3% -168.7% 47.4% -165.1% -230.1%

Pay out ratio 29.2% -95.1% 0.0% 0.0% 36.0%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 65.0 69.9 75.1 79.7 83.6

FFO 24.8 28.6 31.5 35.0 38.5

FFO margin 38.2% 40.9% 41.9% 43.9% 46.1%


Net asset value per share 13.88 14.54 15.58 16.57 17.57

FFOPS (in EUR) 1.16 1.27 1.27 1.36 1.40

DPS (in EUR) 0.45 0.48 0.51 0.55 0.60

Dividend yield 3.9% 3.4% 3.0% 3.3% 3.6%

EV/EBITDA 13.7 14.4 13.8 16.2 15.9

P/NAV 0.8 1.0 1.1 1.0 1.0

P/FFO 10.1 11.3 13.5 12.3 12.0


Next event


Change in model

Sales FFO EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst

Dr. Georg Kanders , Analyst

Phone: +49 (0)211 4952-718

[email protected]


VIB Vermögen AG Bavaria and logistics

VIB Vermögen is a fast-growing commercial property company with a regional focus

on the prosperous Ingolstadt area. A further speciality of the real estate portfolio is

its emphasis on logistics/industry (60% of rental income). Based on its P/FFO ratio,

the company has the most attractive valuation in our coverage. .

INVESTMENT CASE

VIB Vermögen is the only larger listed company with significant exposure to the

booming logistics property market. The 1,000,000 sqm portfolio with a value of

close to € 1 bn has a rental yield of above 7%. Own developments and the

expansions of existing properties contribute to further yield growth of the company,

which has strong roots in the region. In particular, the completion and full letting of

the own development at Interpark-Großmehring (Q3 2015, initial yield 9.5%) should

enable the company to generate growth in 2016 even without acquisitions. VIB also

has another plot of land in Großmehring.

CATALYSTS

The continuous expansion of the portfolio is coupled with relatively steadily growing

operating results qoq. The company could announce property transactions at any

time.

VALUATION

Based on the P/FFO ratio, VIB Vermögen is the most attractive real-estate stock in

our coverage universe. Although the dividend yield is below average, VIB Vermögen

scores with regular dividend increases. What is more, the company has consistently

decreased its gearing ratio. We reiterate our BUY recommendation.

28/01/2016

Buy (Buy )

19.50 EUR (19.50 EUR )

Close 25/01/2016 16.72 EUR

Bloomberg: VIH GY WKN: 245751

Sector Real Estate





YTD 6.8%

1 month 7.1%

12 months 14.9%

Share data

EV (m EUR; 2016) 1,038



Free float 80.5%



SWOT


• Focus on a prosperous region with above-average growth prospects

• Highly diversified commercial property portfolio

• High yielding portfolio reduces risk of valuation losses

• Good network especially in the Ingolstadt region

• Extensions and early collaboration with tenants offer additional

potential


• High share of tenants with exposure to the automotive industry

• Dehner (garden centre operator) accounts for nearly 10% of rental

income

• Equity is needed for stronger growth

• The Ingolstadt region is largely dependent on the performance of Audi

• Certain interest rate risk as average maturity of interest rate agreements

is about 4.5 years


• Ludwig Schlosser (CEO)

• Holger Pilgenröther (CFO)

• Martin Pfandzelter (COO)

VIB Vermögen is a property company with a regional focus on Bavaria. Most

of its properties are logistics and industrial sites. A significant portion of its

portfolio is invested in retail properties (specialty stores and retail parks).


• 2015 operating revenue € 74 - 77 m

• EBIT before valuation € 50.5 - 52 m, EBT before valuation € 29 - 35 m

• -



Next event: 27/04/2016 Annual Results Kreissparkasse Biberach 8.5

Raiffeisen-Volksbank Neuburg/Donau eG 5.0

Supervisory board 1.8



6

8

10

12

14

16

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

Company Overview

9.7%6.7%6.2%

29.9%

47.5%

Dehner

Rudolph

Geis

Other TOP 10

Other

2015e 2016e 2017e

Sales (in m EUR) BHL 75.1 79.7 83.6

Consensus 75.4 80.1 83.9

EBITDA (in m EUR) BHL 70.5 64.1 66.4

Consensus 56.5 59.3 64.4

EPS (EUR)

BHL 1.47 1.34 1.34

Consensus 1.23 1.34 1.36

2013 2014 2015e 2016e 2017e

ROCE 6.6% 6.6% 7.4% 6.4% 6.4% Gross yield 7.8% 7.8% 7.8% 7.7% 7.8%

EBITDA margin 83.7% 84.7% 93.8% 80.4% 79.4%

FFO margin 38.2% 40.9% 41.9% 43.9% 46.1% FFO yield 8.3% 8.7% 8.1% 8.2% 8.0%

Equity ratio 37.0% 39.4% 40.2% 40.6% 40.7%

Net gearing 1.5 1.3 1.3 1.3 1.3

Net debt / EBITDA 8.7 8.2 7.3 8.7 8.6

Interest cover > 10 > 10 > 10 > 10 > 10



VIB Vermögen AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 65.0 69.9 75.1 79.7 83.6

Cost of Sales 0.0 0.0 0.0 0.0 0.0

Gross profit 65.0 69.9 75.1 79.7 83.6





EBITDA 54.3 59.2 70.5 64.1 66.4

Depreciation 0.1 0.1 0.1 0.1 0.1

EBITA 54.2 59.1 70.4 64.0 66.2



EBIT 54.2 59.1 70.4 64.0 66.2




EBT 35.1 38.2 49.4 43.2 46.3

Taxes -6.1 -5.9 -8.4 -7.3 -7.9




Net income (adj.) 27.1 31.3 36.5 34.5 37.0

No. of shares 21.4 22.6 24.9 25.8 27.6

EPS (in EUR) 1.27 1.38 1.47 1.34 1.34


2013 2014 2015e 2016e 2017e

Gross margin - - - - -

EBITDA margin 83.7% 84.7% 93.8% 80.4% 79.4%

EBITA margin 83.5% 84.6% 93.8% 80.3% 79.2%

EBIT margin 83.5% 84.6% 93.8% 80.3% 79.2%

EBT margin 54.0% 54.7% 65.8% 54.2% 55.3%


Tax rate 17.3% 15.4% 17.1% 17.0% 17.0%



Sales 8.6% 7.6% 7.5% 6.2% 4.9%

EBITDA 8.9% 8.9% 19.1% -9.0% 3.5%

EBIT 8.9% 9.0% 19.1% 19.1% 3.5%

EBT 16.0% 8.9% 29.4% -12.6% 7.1%

Net income (adj.) 17.4% 15.4% 16.8% -5.6% 7.4%

EPS 17.2% 9.3% 6.2% -9.0% 0.3%


Key figures



VIB Vermögen AG – Balance sheet


Fixed assets 832.8 897.8 966.8 1,037 1,080

Property, plant and equipment 829.4 894.5 963.5 1,034 1,077




Current assets 31.9 44.5 35.1 15.8 25.7

Inventories 2.8 2.8 2.8 2.8 2.8



Securities 0.0 0.0 0.0 0.0 0.0

Cash 25.5 37.8 28.4 9.2 19.1

Total assets 864.7 942.2 1,002 1,053 1,106




Minorities 14.1 12.6 17.1 18.5 19.9







Short-term debt 41.5 26.6 26.6 23.8 23.8




Total equity and liabilities 864.7 942.2 1,002 1,053 1,106


VIB Vermögen AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 96.3% 95.3% 96.5% 98.5% 97.7%



Current assets 3.7% 4.7% 3.5% 1.5% 2.3%

Inventories 0.3% 0.3% 0.3% 0.3% 0.3%


Cash 2.9% 4.0% 2.8% 0.9% 1.7%







Short-term debt 4.8% 2.8% 2.7% 2.3% 2.2%





VIB Vermögen AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 27.1 31.3 36.5 34.5 37.0

Depreciation 0.1 0.1 0.1 0.1 0.1


Change of provisions -7.2 -7.5 -14.0 -3.9 -3.1

Other 5.0 3.7 10.4 6.5 7.1







Capex, excluding maintenance 0.0 0.0 0.0 0.0 0.0

Payments for acquisitions -78.3 -53.1 -55.0 -66.2 -40.0





Free cash-flow -21.1 -28.1 -22.0 -29.0 1.1





Dividend paid -8.5 -11.4 -12.3 -14.2 -15.3

Cash-flow from financing activities 17.4 40.5 12.7 9.8 8.7

Increase/ decrease in liquid assets -3.6 12.3 -9.4 -19.2 9.8



Change in total cash and cash equivalents -3.6 12.3 -9.4 -19.2 9.8





VIB Vermögen AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 1.27 1.38 1.47 1.34 1.34


Free Cash-flow per share -0.98 -1.25 -0.89 -1.13 0.04


Valuation ratios

EV/Sales 11.5 12.2 13.0 13.0 12.6

EV/EBITDA 13.7 14.4 13.8 16.2 15.9

EV/EBIT 13.8 14.4 13.8 16.2 15.9



Dividend yield 3.9% 3.4% 3.0% 3.3% 3.6%


EBITDA margin 83.7% 84.7% 93.8% 80.4% 79.4%

EBIT margin 83.5% 84.6% 93.8% 80.3% 79.2%



Productivity ratios

Capital turnover 1,278.1% 1,282.2% 1,284.8% 1,298.2% 1,289.5%

Operating leverage -0.1 -0.1 -0.2 0.1 0.0

Sales per employee 2,824,261 3,037,783 3,265,189 3,466,113 3,634,845

EBIT per employee 2,358,304 2,570,609 3,061,281 2,781,975 2,879,842


Financial ratios

Equity ratio 37.0% 39.4% 40.2% 40.6% 40.7%


Net debt / Equity 147.8% 130.4% 128.3% 130.5% 126.9%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA 8.70 8.19 7.33 8.69 8.61

Working Capital (in m EUR) -2.6 -1.9 -1.9 -1.9 -1.9


WC /sales -4.0% -2.7% -2.5% -2.3% -2.2%




Cash conversion cycle -14 -10 -9 -9 -9


Others




Pay out ratio 35.6% 34.7% 34.7% 41.1% 44.7%

Free cash-flow (in m EUR) -21.1 -28.1 -22.0 -29.0 1.1

Free cash flow yield -8.2% -8.0% -5.0% -6.3% 0.2%




in m EUR 2013 2014 2015e 2016e 2017e

Sales 745 766 792 815 840

EBIT 43 43 43 46 49

EBIT margin 5.8% 5.6% 5.4% 5.6% 5.9%



EPS (in EUR) 0.92 0.93 0.98 1.06 1.14

DPS (in EUR) 0.42 0.44 0.48 0.50 0.52

Dividend yield 4.0% 3.7% 3.9% 4.0% 4.2%

EV/Sales 0.3 0.7 0.7 0.6 0.6

EV/EBIT 5.6 12.3 12.2 11.2 10.1



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


Villeroy & Boch AG In a state of flux – initiation of coverage

We are initiating our coverage of Villeroy & Boch with a HOLD rating and a price

target of € 13.00. From a strategic perspective, the company has developed

positively of late. However, we do see a merchandising risk for some countries.

INVESTMENT CASE

Villeroy & Boch has been undergoing a transformation from a traditional ceramics

manufacturer to a modern consumer goods company. The company made progress

in its production processes, particularly in its Bathroom and Wellness division, which

helped to improve the margins. In addition, the company sold a property that was

no longer needed for operations and thus improved its financial scope. This should

still have a positive effect in the long term. The group has recently completed some

preliminary work by increasing the number of showrooms for its Bathroom and

Wellness division, and larger areas of sale in China (revenue share China/Russia 7%).

However, given our conservative macro-economic outlook on China, we are only

cautiously optimistic that these projects have started to generate cash. In addition,

the increasing market concentration in German wholesale leads to a shift in market

power for the wholesalers. A positive factor is the positive trend in the construction

sector in many European sales markets.

CATALYSTS

Villeroy & Boch is set to announce its 2015 results on 11 February at the Ambiente

trade fair. This should increase the visibility about the run of business in the sales

markets with a more difficult environment.

VALUATION

Our price target is based on a DCF model. The share is currently trading at a PER2016e

of 12x, which appears inexpensive at first glance. However, the aforementioned

merchandising risk in individual markets puts this into perspective. On the contrary,

the dividend yield of about 4% coupled with anticipated higher pay-outs in the

coming year is positive for investors, in our view.

28/01/2016

Hold (n.a. )

13.00 EUR (- EUR )

Close 25/01/2016 12.48 EUR

Bloomberg: VIB3 GR WKN: 765723

Sector Consumer





YTD 10.9%

1 month 9.5%

12 months 11.5%

Share data

EV (m EUR; 2016) 515



Free float pref. 88.0%



SWOT


• Innovative strength in design, functionality and manufacturing processes

• Pressing ahead with product standardisation

• Innovations in process technologies e.g. 3D printing

• Opportunities in connecting the bricks-and-mortar business with the

digital world


• Merchandising risk in e.g. China, Russia and the Middle East

• Volatility of raw material prices


• Frank Göring (CEO)

• Dr. Markus Warncke (CFO)

• Nicolas Luc Villeroy (Vorstand Tischkultur)

• Andreas Pfeiffer (Vorstand Bad und Wellness)

Villeroy & Boch's business activities focus on the divisions Bath & Wellness

and Tableware. The company has locations in 125 countries including 14

production sites in Europe, Mexico and Thailand. This listed company's

headquarters are in Mettlach/Saarland.


• 2015: revenue growth of 3-5 %

• 2015: EBIT increase of more than 5%

• -



Next event: 11/02/2016 Annual Results Pref.: Villeroy & Boch AG, ordinary shares not listed 12.0



02468

10121416

2011 2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

61.2%

38.8%

Bathroom & Wellness

Tableware

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 792 815 840



Consensus 44 49 51

EPS (EUR) BHL 0.98 1.06 1.14

Consensus 0.95 1.08 1.21

2013 2014 2015e 2016e 2017e

R&D/Sales 0.0% 0.0% 0.0% 0.0% 0.0%

Capex/Sales 3.5% 5.8% 3.7% 3.4% 3.3%



Equity ratio 26.8% 23.2% 24.9% 26.7% 28.5%


Interest cover > 10 > 10 > 10 > 10 > 10



Villeroy & Boch AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 745 766 792 815 840

Cost of Sales -421 -425 -436 -447 -459

Gross profit 324 341 356 369 381




Other operating result 15 2 -1 -1 -1

EBITDA 70 70 70 73 77


EBITA 43 43 43 46 49



EBIT 43 43 43 46 49




EBT 34 35 37 40 43

Taxes -10 -11 -11 -12 -13




Net income (adj.) 24 25 26 28 30

No. of shares 26 26 26 26 26

EPS (in EUR) 0.92 0.93 0.98 1.06 1.14


2013 2014 2015e 2016e 2017e

Gross margin 43.5% 44.6% 45.0% 45.2% 45.4%

EBITDA margin 9.3% 9.1% 8.9% 9.0% 9.1%

EBITA margin 5.8% 5.6% 5.4% 5.6% 5.9%

EBIT margin 5.8% 5.6% 5.4% 5.6% 5.9%

EBT margin 4.6% 4.6% 4.7% 4.9% 5.1%


Tax rate 29.0% 30.1% 30.0% 30.0% 30.0%



Sales 0.2% 2.8% 3.3% 3.0% 3.0%

EBITDA 20.9% 0.9% 0.4% 4.4% 4.2%

EBIT 39.8% 0.0% -0.5% 7.1% 6.7%

EBT 82.4% 3.2% 5.1% 8.3% 7.7%

Net income (adj.) 61.3% 1.7% 5.3% 8.3% 7.7%

EPS 61.3% 1.7% 5.3% 8.3% 7.7%


Key figures



Villeroy & Boch AG – Balance sheet


Fixed assets 265 284 286 286 286





Current assets 335 339 350 366 383

Inventories 149 140 140 140 140




Cash 60 67 78 93 110

Total assets 600 623 637 652 669

















Villeroy & Boch AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 44.1% 45.6% 45.0% 43.9% 42.8%



Current assets 55.9% 54.4% 55.0% 56.1% 57.2%

Inventories 24.8% 22.4% 22.0% 21.5% 20.9%


Cash 10.1% 10.7% 12.2% 14.3% 16.5%







Short-term debt 4.4% 4.2% 4.1% 4.0% 3.9%





Villeroy & Boch AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 24 25 26 28 30




Other -1 1 0 0 0


Change in inventory 12 -2 0 0 0

Change in accounts receivable 0 0 0 0 0






Financial investments 0 -2 0 0 0






Increase/decrease in debt position 0 0 0 0 0



Dividend paid -10 -10 -12 -13 -13



Effects of exchange rate changes -1 -1 0 0 0







Villeroy & Boch AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.92 0.93 0.98 1.06 1.14




Valuation ratios

EV/Sales 0.3 0.7 0.7 0.6 0.6

EV/EBITDA 3.5 7.6 7.4 7.0 6.5

EV/EBIT 5.6 12.3 12.2 11.2 10.1



Dividend yield 4.0% 3.7% 3.9% 4.0% 4.2%


EBITDA margin 9.3% 9.1% 8.9% 9.0% 9.1%

EBIT margin 5.8% 5.6% 5.4% 5.6% 5.9%



Productivity ratios






Financial ratios

Equity ratio 26.8% 23.2% 24.9% 26.7% 28.5%


Net debt / Equity -5.7% -10.9% -16.9% -24.3% -31.0%

Interest cover > 10 > 10 > 10 > 10 > 10

Net debt / EBITDA -0.13 -0.23 -0.38 -0.57 -0.77


Change Working Capital (in m EUR) -8 -12 1 0 0

WC /sales 25.5% 23.2% 22.6% 22.0% 21.3%






Others


EBIT CAGR (last 3 years) -195.5% 5.3% 11.6% 2.2% 4.4%


Pay out ratio 45.8% 47.2% 49.0% 47.1% 45.5%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,160 1,284 1,384 1,473 1,611

EBIT 95 136 105 113 132

EBIT margin 8.2% 10.6% 7.6% 7.7% 8.2%



EPS (in EUR) 0.87 1.30 0.97 1.05 1.24

DPS (in EUR) 0.40 0.50 0.40 0.40 0.50

Dividend yield 3.5% 2.9% 2.8% 3.3% 4.2%

EV/Sales 0.9 1.1 0.9 0.7 0.7

EV/EBIT 10.8 10.4 11.9 9.6 8.1



Next event

RPC 15/03/2016

Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-313

[email protected]


Wacker Neuson SE 2015 guidance achieved – still on track for growth

We expect the company to remain on track for growth even though the market

environment remains sluggish - particularly in the agricultural business and the oil

and gas industry. In 2015, the market has digested the lowering of the guidance in

terms of revenue by € 50 m to € 1.35 – 1.4 bn and the 250-bps reduction of the

EBIT margin to 7-8% and thus, the stock has already outperformed the SDAX.

INVESTMENT CASE

While the construction machinery market in China slumped by a third and in Russia

by more than 70%, Wacker Neuson’s 9M 2015 revenues passed the one billion mark

for the first time (+8.7% vs. previous year).

The broad diversification of the product portfolio and the more stable conditions in

Europe (~ 72% revenue share) help the company. In future, however, the plan is to

generate more growth from the two other regions (Americas 25%; Asia 3%). With a

20% revenue share, the services business should offer potential through an

expansion of the leasing business and service offers.

CATALYSTS

• 15 March: 2015 results - our EBIT forecast is 7% above the FactSet consensus.

• The 2016 guidance is likely to reflect the current market environment and be in

line with our expectations (FactSet/BHLe: EBIT € 113 m).

• The bi-annual Bauma 2016 trade fair will take place on 11-17 April - we expect

positive impetus thanks to a number of new products (6-10t diggers, vibration

plates, rollers) and the “zero emissions” equipment.

VALUATION

Our DCF model for this share points to a fair value of € 19.50, while our CF-yield

model merely indicates a fair value of € 14.40 due to the 2016 profit warning

(2017e: € 16.00). The average of these results leads us to our price target of € 16.00

(PER2017e ~1x).

28/01/2016

Buy (Buy )

16.00 EUR (16.00 EUR )

Close 21/01/2016 12.00 EUR

Bloomberg: WAC GR WKN: WACK01

Sector Construction




Compared to SDAX

YTD -4.2%

1 month -1.4%

12 months -36.5%

Share data

EV (m EUR; 2016) 1,082



Free float 36.3%



SWOT


• Premium supplier with >300 products and synergy potential in

distribution

• Solid balance sheet of this family-run company allows acquisitions

• Growth drivers: New markets (Americas, Asia) and the service business

• Strategic alliances (CAT, Claas) ensure that plants are well utilised

• New marketing alliance with HAMM AG (Wirtgen Group) for DACH-

region.


• Revenues still very dependent on Europe (>70%)

• Margins with leasing companies (~ 20% of business) less than for direct

sales

• Cyclical agricultural machinery business still accounts for not enough of

business (15%)

• Visibility in construction machinery very low - current assets increasing


• Cem Peksaglam (CEO)

• Martin Lehner

• Günther C. Binder (CFO)

The Wacker Neuson group manufactures construction machinery (Light

Equipment and Compact Equipment) and offers associated services via

>140 sales and service stations as well as >12,000 sales and service partners

worldwide. The company was founded in 1848. Today it has more than 40

subsidiaries and employs more than 4,000 people. The company is

headquartered in Munich, Germany.


• 2015: Revenues € 1.35-1.4 bn

• 2015: EBIT margin 7%-8%

• Revenue should grow with a CAGR of 10% to above € 2 bn (probably by

2019e)



Next event: 15/03/2016 RPC Wacker Family 33.0

Neunteufel Family 30.0



8

13

18

2013 2014 2015 2016PER AVG STD + 1 STD - 1

44,%

34,6%

21,%Compact Equipment

Light Equipment

Services

Company Overview

2015e 2016e 2017e

Sales (in m EUR)

BHL 1,384 1,473 1,611

Consensus 1,361 1,403 1,496



EPS (EUR) BHL 0.97 1.05 1.24

Consensus 0.90 1.07 1.25

2013 2014 2015e 2016e 2017e

R&D/Sales 2.2% 2.2% 2.5% 2.4% 2.3%

Capex/Sales 7.5% 7.0% 7.1% 5.9% 6.0%



Equity ratio 71.0% 70.2% 69.1% 69.5% 70.1%


Interest cover 0.0 0.0 0.0 0.0 0.0



Wacker Neuson SE – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 1,160 1,284 1,384 1,473 1,611

Cost of Sales -807 -903 -1,007 -1,071 -1,162

Gross profit 353 381 377 403 449





EBITDA 153 196 171 179 202


EBITA 95 136 105 113 132



EBIT 95 136 105 113 132




EBT 88 130 99 106 125

Taxes -26 -38 -30 -32 -38



Minority interest 0 -1 -1 -1 -1

Net income (adj.) 61 92 69 74 87

No. of shares 70 70 70 70 70

EPS (in EUR) 0.87 1.30 0.97 1.05 1.24


2013 2014 2015e 2016e 2017e

Gross margin 30.4% 29.7% 27.2% 27.3% 27.9%

EBITDA margin 13.2% 15.3% 12.4% 12.2% 12.6%

EBITA margin 8.2% 10.6% 7.6% 7.7% 8.2%

EBIT margin 8.2% 10.6% 7.6% 7.7% 8.2%

EBT margin 7.6% 10.1% 7.1% 7.2% 7.8%


Tax rate 30.0% 29.2% 30.0% 30.0% 30.0%



Sales 6.2% 10.8% 7.7% 6.5% 9.4%

EBITDA 8.3% 27.9% -12.9% 4.8% 12.9%

EBIT 11.7% 43.6% -22.9% 7.8% 16.9%

EBT 13.1% 47.8% -24.2% 7.6% 18.0%

Net income (adj.) 13.2% 49.4% -25.1% 7.7% 18.1%

EPS 13.5% 49.4% -25.4% 7.7% 18.1%


Key figures



Wacker Neuson SE – Balance sheet


Fixed assets 792 814 846 868 895





Current assets 530 634 673 707 751

Inventories 334 424 424 445 467




Cash 16 14 28 34 49

Total assets 1,322 1,448 1,519 1,575 1,646


Shareholders’ equity 939 1,016 1,050 1,095 1,154

Shareholders’ equity (before minority) 935 1,012 1,045 1,091 1,150














Wacker Neuson SE – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 59.9% 56.2% 55.7% 55.1% 54.4%



Current assets 40.1% 43.8% 44.3% 44.9% 45.6%

Inventories 25.2% 29.3% 27.9% 28.3% 28.4%


Cash 1.2% 1.0% 1.8% 2.2% 3.0%







Short-term debt 4.7% 4.6% 6.0% 5.5% 5.0%





Wacker Neuson SE – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 61 92 69 74 87




Other 26 4 0 0 0


Change in inventory 14 -76 0 -21 -22

Change in accounts receivable -24 -2 -25 -6 -6












Increase/decrease in debt position -36 5 27 -1 0



Dividend paid -21 -28 -35 -28 -28


Increase/ decrease in liquid assets -2 -2 14 7 15



Change in total cash and cash equivalents -3 -2 14 7 15





Wacker Neuson SE – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.87 1.30 0.97 1.05 1.24




Valuation ratios

EV/Sales 0.9 1.1 0.9 0.7 0.7

EV/EBITDA 6.7 7.2 7.3 6.0 5.3

EV/EBIT 10.8 10.4 11.9 9.6 8.1



Dividend yield 3.5% 2.9% 2.8% 3.3% 4.2%


EBITDA margin 13.2% 15.3% 12.4% 12.2% 12.6%

EBIT margin 8.2% 10.6% 7.6% 7.7% 8.2%



Productivity ratios


Operating leverage 0.1 0.3 -0.3 0.1 0.1




Financial ratios

Equity ratio 71.0% 70.2% 69.1% 69.5% 70.1%


Net debt / Equity 18.9% 17.7% 18.4% 17.0% 14.8%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 1.15 0.91 1.13 1.04 0.85



WC /sales 39.1% 41.4% 40.1% 39.4% 37.7%






Others


EBIT CAGR (last 3 years) 37.2% 3.2% 7.3% 6.1% -1.0%

Net income CAGR (last 3 years) 36.8% 2.2% 8.2% 6.4% -1.6%

Pay out ratio 45.8% 38.3% 41.1% 38.1% 40.4%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 300 303 336 348 360

EBIT 17 18 33 37 39

EBIT margin 5.7% 6.1% 9.9% 10.6% 10.8%

Net financial debt 3 -10 2 -1 -12


EPS (in EUR) 0.80 0.91 1.62 1.79 1.90

DPS (in EUR) 0.58 1.65 1.20 1.30 1.40

Dividend yield 5.4% 12.6% 3.9% 4.8% 5.2%

EV/Sales 0.2 0.6 1.3 1.1 1.0

EV/EBIT 3.8 9.9 13.1 10.4 9.6



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


WashTec AG Washing is always needed – initiation of coverage

We are initiating our coverage of WashTec with a BUY rating and a price target of

€ 33.00. The key topics are a simple business model, the only listed car washer,

which is more than twice as large as the next largest competitor, the world’s largest

installed base of machines (35,000) paired with attractive service agreements, a

solid balance sheet and growth.

INVESTMENT CASE

WashTec manufactures, markets and maintains a comprehensive range of products

for the cleaning of all types of vehicles and should also remain the global number

one for the petrochemical and automotive groups as well as SMEs. The steady

expansion of the service offering ranging from maintenance to total facility

management underscore WashTec’s position as a full service provider. We welcome

the company aim of expanding strategically in the next few years to extend its

market and technological leadership. WashTec generates 80% of its revenue in

mature markets, particularly in Europe. Here too, we currently see further

opportunities. Key areas are the energy efficiency of the systems, but also the often

unresolved questions regarding the washing of leasing agency vehicles. We see

great potential in North America and Asia because we expect automatic car washes

to gain greater general acceptance. In general, we see also growth potential in

terms of user-friendliness, throughput, and quality of the washes, but also in

customer segments such as car-sharing operators or operators of car washes for

rental fleets.

CATALYSTS

The release of the preliminary results at the start of February and the management’s

comments in this setting will probably clarify the growth areas and opportunities.

VALUATION

Our price target is based on our peer-group model (specialist engineering). It puts

the PER2016e of 15x - which appears high at first glance - in context. In addition, a

dividend yield of 4% backs our positive view.

28/01/2016

Buy (n.a. )

33.00 EUR (- EUR )

Close 25/01/2016 26.94 EUR

Bloomberg: WSU GR WKN: 750750

Sector Industrial





YTD -2.7%

1 month -2.9%

12 months 103.0%

Share data

EV (m EUR; 2016) 384



Free float 87.4%



SWOT


• Modular concept permits all customer requirements to be addressed

optimally

• WashTec regards itself as a full service provider

• Having Auwa Chemie as part of the group can allow it to assist its

clientele with an even wider range of cleaning chemicals

• Growth of global activities should lead to economies of scale in

procurement and production

• -


• Many petrochemical companies have stopped investments for basic

supply agreements

• Changes in driving habits or legal requirements can cut vehicle usage

and therefore lead to fewer car washes

• Fluctuations in demand during the year harbour capacity utilisation risks


• Dr. Volker Zimmermann (CTO & CEO)

• Rainer Springs (CFO)

• Karoline Kalb (CHRO)

• Stephan Weber (CSO)

The WashTec group is the world’s leading company is the area of cleaning

technology for traffic systems. The company employs more than 1,600 staff

to manufacture and maintain a product range for all types of vehicle.


• 2015: 10% revenue growth

• 2015: EBIT margin of ~ 9.5%

• -



Next event: 31/03/2016 Annual Results Kempen 10.7

EQMC Europe 9.8

Dr. Kurt Schwarz 8.4



10

12

14

16

18

20

2012 2013 2014 2015 2016PER AVG STD + 1 STD - 1

78.0%

3.7%

14.2%4.1% Core Europe

North America

Asia/Pacific

Eastern Europe

Company Overview

2015e 2016e 2017e



EBIT (in m EUR)

BHL 33 37 39

Consensus 33 35 38

EPS (EUR) BHL 1.62 1.79 1.90

Consensus 1.60 1.80 1.94

2013 2014 2015e 2016e 2017e



ROCE 16.6% 17.2% 35.9% 36.5% 35.6%


Equity ratio 50.4% 48.9% 45.2% 47.6% 49.7%

Net debt / Equity 3% -11% 2% -1% -12% Net debt / EBITDA 0.1 -0.3 0.0 0.0 -0.2

Interest cover 0.0 0.0 0.0 0.0 0.0



WashTec AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 300 303 336 348 360

Own work capitalised -2 1 5 2 2

Total sales 297 303 341 350 362





EBITDA 27 29 43 46 49


EBITA 17 18 33 37 39



EBIT 17 18 33 37 39




EBT 16 18 33 36 38

Taxes -5 -5 -10 -11 -12




Net income (adj.) 11 13 23 25 26

No. of shares 14 14 14 14 14

EPS 0.80 0.91 1.62 1.79 1.90


2013 2014 2015e 2016e 2017e

Gross margin 60.2% 60.3% 58.3% 58.3% 58.3%

EBITDA margin 9.0% 9.5% 12.8% 13.4% 13.5%

EBITA margin 5.7% 6.1% 9.9% 10.6% 10.8%

EBIT margin 5.7% 6.1% 9.9% 10.6% 10.8%

EBT margin 5.3% 5.8% 9.7% 10.4% 10.7%


Tax rate 29.0% 28.1% 31.0% 31.0% 31.0%



Sales -0.6% 1.0% 11.0% 3.5% 3.5%

EBITDA -7.3% 5.8% 49.9% 8.3% 4.5%

EBIT -10.9% 7.3% 81.3% 10.7% 5.7%

EBT -4.3% 12.2% 84.8% 10.9% 5.8%

Net income (adj.) 11.4% 13.6% 77.3% 10.9% 5.8%

EPS 11.7% 13.6% 77.3% 10.9% 5.8%


Key figures



WashTec AG – Balance sheet












Cash 4 16 3 6 17

Total assets 174 186 172 181 190

















WashTec AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 52.7% 46.9% 48.8% 48.6% 44.3%



Current assets 47.3% 53.1% 51.2% 51.4% 55.7%

Inventories 19.7% 19.1% 20.9% 20.4% 20.0%


Cash 2.2% 8.4% 1.8% 3.3% 8.8%







Short-term debt 1.8% 1.2% 1.2% 1.1% 1.1%





WashTec AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) 11 13 23 25 26




Other 5 7 0 0 0




Change in accounts payable 2 -3 0 1 1

Change in other working capital positions -11 2 0 0 0










Increase/decrease in debt position -8 -2 -1 0 0

Purchase of own shares 0 0 -13 0 0


Dividend paid -8 -9 -23 -17 -18


Increase/ decrease in liquid assets -1 13 -12 3 11

Effects of exchange rate changes 1 -1 0 0 0


Change in total cash and cash equivalents -1 13 -12 3 11





WashTec AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS 0.80 0.91 1.62 1.79 1.90




Valuation ratios

EV/Sales 0.2 0.6 1.3 1.1 1.0

EV/EBITDA 2.4 6.4 10.2 8.3 7.7

EV/EBIT 3.8 9.9 13.1 10.4 9.6



Dividend yield 5.4% 12.6% 3.9% 4.8% 5.2%


EBITDA margin 9.0% 9.5% 12.8% 13.4% 13.5%

EBIT margin 5.7% 6.1% 9.9% 10.6% 10.8%



Productivity ratios






Financial ratios

Equity ratio 50.4% 48.9% 45.2% 47.6% 49.7%

Net financial debt (in m EUR) 3 -10 2 -1 -12

Net debt / Equity 3.3% -10.7% 2.4% -1.1% -12.4%

Interest cover 0.0 0.0 0.0 0.0 0.0

Net debt / EBITDA 0.11 -0.34 0.04 -0.02 -0.24



WC /sales 21.7% 23.5% 21.7% 21.4% 21.1%






Others



Net income CAGR (last 3 years) 1.3% -195.5% 30.9% 30.7% 27.6%

Pay out ratio 72.2% 180.7% 74.1% 72.4% 73.7%






in m EUR 2013 2014 2015e 2016e 2017e

Sales 49 101 177 266 359

EBIT -12 -12 -17 -12 -3

EBIT margin -24.7% -11.6% -9.6% -4.3% -0.9%

Net financial debt 2 -32 -93 -71 -57

Free cash-flow -12 -7 -44 -22 -14

EPS (in EUR) -0.48 -0.38 -1.01 -0.72 -0.39

DPS (in EUR) 0.00 0.00 0.00 0.00 0.00

Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%

EV/Sales 1.0 2.1 0.9 0.7 0.5

EV/EBIT -4.2 -18.5 -9.2 -15.4 -62.7



Next event


Change in model

Sales EBIT EPS

2015e --- --- ---

2016e --- --- ---

2017e --- --- ---

Analyst


Phone: +49 (0)211 4952-311

[email protected]


windeln.de AG 50:50 – Initiation of coverage

We are optimistic about the future performance of the company in German-

speaking Europe (9M 2015: +79%) and in the rest of Europe (9M 2015: >300%).

However, we are cautious about the company’s exposure to China – also with

regard to the current macroeconomic conditions (9M 2015: 52% of group revenue).

We are initiating our coverage with a HOLD rating and a price target of € 10.00.

INVESTMENT CASE

Due to the growing online affinity of young families, the low penetration rate in the

online market for baby and infant products compared with other product areas (e.g.

consumer electronics, shoes, etc.), provides the structural growth pre-requisites with

a revenue CAGR2014-2017e of 52%.

Besides the organic growth, windeln.de should benefit from further acquisitions in a

fragmented European market. In addition, we expect a systematic expansion of the

product range in the years to come as well.

However, we are cautious about how the Chinese market will develop. We expect

growth in this region to slow down (9M 2015: +65%), even though the arguments

in favour of growth (relaxation of the one-child policy, milk substitute instead of

breast milk) still apply.

CATALYSTS

The company is due to publish its 2015 results on 17 March and to present a

guidance for 2016. However, we do not expect the company to break even before

H2 2017. We would welcome news about acquisitions because it would support

growth in the medium term.

VALUATION

The peer-group median is currently trading at a 2017 EV/sales multiple of 0.7x. At first

glance, windeln.de is cheap at 0.5x. However, as we see risks in China, we consider

this valuation discount to be justified.

28/01/2016

Hold (n.a. )

10.00 EUR (- EUR )

Close 25/01/2016 9.43 EUR

Bloomberg: WDL GR WKN: WNDL11

Sector Retail





YTD -2.1%

1 month -0.1%

12 months -

Share data

EV (m EUR; 2016) 178



Free float 61.9%



SWOT


• Structural shift from offline to online

• Market is internationally fragmented: Chances arise from consolidation

• Organic growth will be strengthened via acquisitions

• Expanding product range to include new product categories

• Scalability should improve margins in medium term


• Low barriers to market entry

• Exposure to China associated with possible regulatory changes

• Concentration on manufacturer level

• Infrastructure und technology must always be up to date


• Konstantin Urban

• Alexander Brand

• Dr. Nikolaus Weinberger

windeln.de is one of the leading pure online retailers for children and baby

products in Europe and offers one of the most comprehensive product

ranges. It ranges from nappies, baby food, children’s furniture, toys, clothing

through to baby phones and car seats. Customers are won over with entry-

level products, such as nappies and baby food, which permits cross-selling to

higher-margin in products. This leads to re-purchase rate of >80% and

marketing costs per purchase of € 3.60.


• 2015: Revenue growth of ~ 75%

• 2015: Improvement of adj. EBIT margin to between -7% and -8%

• Reduction of cost of sales as % of revenue sales

• Minimising of fulfilment costs as % of revenue

• -

HISTORICAL EV/SALES REVENUE BREAKDOWN (LAST ACTUAL YEAR)


Next event: 17/03/2016 Annual Results DN Capital Ltd. 14.2

Acton Capital Partners 11.4

Deutsche Bank 8.7



0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

06/15 08/15 10/15 12/15EV/SALES Mean Mean+SD Mean-SD

43.5%54.9%

1.6% German-speakingEurope

China

Others

Company Overview

2015e 2016e 2017e



EBIT (in m EUR)

BHL -17 -12 -3

Consensus -13 -8 1

EPS (EUR)

BHL -1.01 -0.72 -0.39

Consensus -0.92 -0.58 -0.17

2013 2014 2015e 2016e 2017e



ROCE -152.7%

-27.5% -13.9% -11.2% -3.3%

Free cash flow yield - -1.5% -16.2% -9.3% -6.0%

Equity ratio 18.5% 60.7% 80.2% 73.1% 67.5%

Net debt / Equity 56% -93% -82% -75% -67%

Net debt / EBITDA -0.1 2.8 5.6 6.4 22.2

Interest cover < -10 < -10 < -10 < -10 -0.4



windeln.de AG – Income statement

in m EUR 2013 2014 2015e 2016e 2017e

Sales 49 101 177 266 359

Cost of Sales -39 -78 -133 -189 -248

Gross profit 10 23 44 77 111





EBITDA -12 -12 -17 -11 -3


EBITA -12 -12 -17 -12 -3



EBIT -12 -12 -17 -12 -3

Financial result 0 2 -9 -7 -7

Income on ordinary activities -12 -10 -26 -19 -10


EBT -12 -10 -26 -19 -10

Taxes 0 0 0 0 0

Net income from cont. operations -12 -10 -26 -19 -10



Net income (adj.) -12 -10 -26 -19 -10

No. of shares 26 26 26 26 26

EPS (in EUR) -0.48 -0.38 -1.01 -0.72 -0.39


2013 2014 2015e 2016e 2017e

Gross margin 20.9% 23.1% 25.0% 29.0% 31.0%

EBITDA margin -24.5% -11.4% -9.4% -4.2% -0.7%

EBITA margin -24.7% -11.6% -9.6% -4.3% -0.9%

EBIT margin -24.7% -11.6% -9.6% -4.3% -0.9%

EBT margin -24.8% -9.5% -14.6% -7.0% -2.8%

Net profit margin -24.8% -9.7% -14.6% -7.0% -2.8%

Tax rate -0.2% -2.5% 0.0% 0.0% 0.0%



Sales >100% >100% 75.0% 50.0% 35.0%

EBITDA 67.0% -4.8% 44.5% -33.0% -77.0%

EBIT 67.1% -4.1% 44.7% -31.8% -73.5%

EBT 67.9% -21.7% >100% -28.5% -45.8%

Net income (adj.) 68.0% -19.9% >100% -28.5% -45.8%

EPS 68.0% -19.9% >100% -28.5% -45.8%


Key figures



windeln.de AG – Balance sheet












Cash 0 34 95 73 59

Total assets 16 57 142 130 126

















windeln.de AG – Balance sheet structure

Assets 2013 2014 2015e 2016e 2017e

Fixed assets 28.6% 7.9% 14.8% 17.9% 20.2%



Current assets 71.5% 92.1% 85.2% 82.1% 79.8%

Inventories 44.3% 18.9% 9.9% 13.8% 17.5%


Cash 1.6% 59.4% 66.8% 56.0% 46.4%







Short-term debt 11.7% 2.7% 1.1% 1.2% 1.2%





windeln.de AG – Cash flow statement

in m EUR 2013 2014 2015e 2016e 2017e

Net income (adj.) -12 -10 -26 -19 -10




Other 1 1 0 0 0

Operating Cash-flow before changes in w/c -8 -4 -25 -18 -10

Change in inventory -4 -3 -3 -4 -4


Change in accounts payable 3 5 5 7 6

Change in other working capital positions -1 -2 -3 -3 -3

Operating Cash-flow -11 -6 -28 -19 -12

Capex, excluding maintenance 0 0 -3 -3 -3

Payments for acquisitions -1 -1 -14 0 0





Free cash-flow -12 -7 -44 -22 -14


Increase/decrease in debt position 2 0 0 0 0





Increase/ decrease in liquid assets 0 34 61 -22 -14



Change in total cash and cash equivalents 0 34 61 -22 -14





windeln.de AG – Ratios

2013 2014 2015e 2016e 2017e

Per Share Data

EPS -0.48 -0.38 -1.01 -0.72 -0.39




Valuation ratios

EV/Sales 1.0 2.1 0.9 0.7 0.5

EV/EBITDA -4.3 -18.8 -9.4 -15.9 -74.9

EV/EBIT -4.2 -18.5 -9.2 -15.4 -62.7



Dividend yield 0.0% 0.0% 0.0% 0.0% 0.0%


EBITDA margin -24.5% -11.4% -9.4% -4.2% -0.7%

EBIT margin -24.7% -11.6% -9.6% -4.3% -0.9%

Net return on sales -24.8% -9.7% -14.6% -7.0% -2.8%

Return on capital employed (ROCE) -152.7% -27.5% -13.9% -11.2% -3.3%

Productivity ratios




EBIT per employee 0 0 0 0 0


Financial ratios

Equity ratio 18.5% 60.7% 80.2% 73.1% 67.5%

Net financial debt (in m EUR) 2 -32 -93 -71 -57

Net debt / Equity 56.0% -93.0% -81.9% -74.9% -67.0%

Interest cover < -10 < -10 < -10 < -10 -0.4

Net debt / EBITDA -0.14 2.79 5.59 6.38 22.19

Working Capital (in m EUR) 2 2 1 -1 -2

Change Working Capital (in m EUR) 2 0 -1 -2 -1

WC /sales 4.9% 1.9% 0.6% -0.4% -0.6%






Others

Sales CAGR (last 3 years) - - 101.9% 75.2% 52.5%

EBIT CAGR (last 3 years) - - 32.3% -1.8% -36.1%

Net income CAGR (last 3 years) - - 52.6% 14.8% 0.8%

Pay out ratio 0.0% 0.0% 0.0% 0.0% 0.0%

Free cash-flow (in m EUR) -12 -7 -44 -22 -14




German Small Caps 2016 – Cloudy with sunny spells 28/01/2016

COMPANY OVERVIEW

Screening tables

Source: Bankhaus Lampe, FactSet

Company Analyst Recommendation Price Target Free Float factor No. of shares Market cap Free float market cap

Adler Modemärkte AG Schlienkamp, Christoph Hold 10.00 0.42 18.51 168.90 71.28Ahlers AG Schlienkamp, Christoph Hold 9.00 0.48 13.68 99.90 48.15AIXTRON SE Iltgen, Karsten Hold 6.00 0.93 112.21 393.40 366.65Amadeus FiRe AG Schlienkamp, Christoph Hold 73.00 1.00 5.20 350.47 350.47Bastei Lübbe AG Schlienkamp, Christoph Buy 8.50 0.43 13.30 92.83 39.55BAUER Aktiengesellschaft Gabriel, Marc Hold 19.00 0.52 17.13 246.50 127.69BayWa AG Gabriel, Marc Hold 36.00 0.40 34.52 950.40 377.31Borussia Dortmund GmbH & Co. KGaASchlienkamp, Christoph Buy 5.00 0.61 92.00 361.40 219.73Capital Stage AG Schlienkamp, Christoph Buy 10.60 0.51 75.34 569.40 291.53CEWE Stiftung & Co. KGaA Schlienkamp, Christoph Hold 60.00 0.70 6.96 337.70 236.05CHORUS Clean Energy AG Schlienkamp, Christoph Buy 12.00 0.87 27.70 263.20 228.72comdirect bank AG Smith, Neil Hold 10.00 0.19 141.22 1398.10 261.44DATRON AG Schlienkamp, Christoph Buy 12.50 0.28 4.00 38.20 10.51Delticom AG Schlienkamp, Christoph Hold 22.00 0.50 11.86 215.80 107.68Deutz AG Schönell, Gordon Hold 3.50 0.75 120.86 361.40 271.05DIC Asset AG Kanders, Georg Buy 10.50 0.67 68.58 596.60 398.53euromicron AG Specht, Wolfgang Hold 9.70 1.00 7.18 50.20 50.20Evotec AG Braun, Volker Buy 4.60 0.75 131.55 455.80 341.85Gerry Weber International AG Schlienkamp, Christoph Hold 17.00 0.54 45.91 511.40 274.11Gesco AG Schlienkamp, Christoph Hold 70.00 0.86 3.33 221.10 190.81GfK SE Schlienkamp, Christoph Buy 45.00 0.44 36.41 962.00 419.43Grammer AG Ludwig, Christian Buy 32.00 0.97 11.21 299.40 290.72Hawesko Holding AG Schlienkamp, Christoph Sell 37.00 0.26 8.98 362.30 92.75Koenig & Bauer AG Schönell, Gordon Hold 29.00 0.85 16.53 500.70 424.09Leifheit AG Schlienkamp, Christoph Buy 60.00 0.77 4.75 219.10 167.83LPKF Laser & Electronics AG Iltgen, Karsten Buy 9.00 1.00 22.27 154.30 154.30Manz AG Iltgen, Karsten Hold 45.00 0.58 5.42 162.40 94.03Masterflex SE Schlienkamp, Christoph Hold 6.00 0.62 8.87 48.80 30.40MLP AG Schäfer, Andreas Hold 4.00 0.50 107.88 331.90 165.29PUMA SE Steiner, Peter Sell 133.00 0.14 14.94 2799.00 397.46QSC AG Specht, Wolfgang Buy 2.20 0.75 124.28 192.90 144.68R. STAHL AG Schönell, Gordon Hold 29.00 0.34 6.44 200.70 68.04Schaltbau Holding AG Schlienkamp, Christoph Buy 55.00 0.68 6.15 309.76 210.33SGL CARBON SE Gabriel, Marc Sell 9.00 0.38 91.42 805.30 302.79SHW AG Ludwig, Christian Hold 24.00 1.00 6.44 148.00 148.00SÜSS MicroTec AG Iltgen, Karsten Hold 6.00 1.00 19.12 161.80 161.80technotrans AG Schönell, Gordon Buy 20.00 0.94 6.49 112.10 105.82TOM TAILOR Holding AG Schlienkamp, Christoph Hold 5.50 0.77 26.03 112.90 86.71Tomorrow Focus AG Schlienkamp, Christoph Hold 3.90 0.41 58.06 181.80 74.90VIB Vermögen AG Kanders, Georg Buy 19.50 0.81 27.58 461.00 371.11Villeroy & Boch AG Schlienkamp, Christoph Hold 13.00 0.88 28.09 350.56 308.49Wacker Neuson SE Gabriel, Marc Buy 16.00 0.36 70.35 862.50 313.09WashTec AG Schlienkamp, Christoph Buy 33.00 0.87 13.98 376.47 329.03windeln.de AG Schlienkamp, Christoph Hold 10.00 0.62 25.75 242.65 150.20



PERFORMANCE OVERVIEW


Company Price YTD 1m 3m 1y 3y 5y 10y

Adler Modemärkte AG 9.12 -9.7% -3.8% -14.1% -28.9% 72.8% n.a. n.a.Ahlers AG 7.55 -2.6% -5.5% -8.5% -32.3% -31.0% -22.6% -50.0%AIXTRON SE 3.51 -15.1% -16.9% -35.0% -53.4% -67.4% -88.2% 37.0%Amadeus FiRe AG 67.42 -10.1% -10.1% -16.8% 7.9% 63.4% 98.9% 674.9%Bastei Lübbe AG 6.98 -5.7% -5.3% -2.4% -6.9% n.a. n.a. n.a.BAUER Aktiengesellschaft 14.39 -17.3% -21.2% -24.1% -11.8% -33.5% -60.7% n.a.BayWa AG 27.53 -3.1% -3.8% -15.9% -20.1% -24.9% -16.4% 50.6%Borussia Dortmund GmbH & Co. KGaA 3.93 -2.1% -0.6% -1.9% 2.3% 33.0% 35.8% 82.3%Capital Stage AG 7.56 -4.2% -5.5% -14.6% 51.8% 96.3% 285.3% 367.2%CEWE Stiftung & Co. KGaA 48.51 -11.2% -9.3% -9.8% -5.3% 43.3% 40.0% 37.6%Chorus Clean Energy AG 9.50 -2.6% -1.4% 10.5% n.a. n.a. n.a. n.a.comdirect bank AG 9.90 -9.2% -8.4% -6.2% 17.4% 16.5% 21.6% 34.0%DATRON AG 9.55 -3.4% -7.2% -0.6% 4.9% -5.4% n.a. n.a.Delticom AG 18.20 -12.6% -13.2% -18.4% 6.8% -48.0% -70.6% n.a.Deutz AG 2.99 -19.0% -18.8% -12.2% -29.0% -32.7% -50.5% -26.5%DIC Asset AG 8.70 -6.7% -5.6% -2.2% -2.0% 9.7% 5.1% -40.7%euromicron AG 7.00 -7.6% -11.4% -19.5% -42.3% -64.5% -67.9% -59.5%Evotec AG 3.47 -16.9% -15.3% -12.2% -6.6% 21.0% 1.9% 30.3%Gerry Weber International AG 11.14 -12.8% -10.9% -29.9% -68.6% -69.0% -37.1% 45.3%Gesco AG 66.49 -6.2% -6.9% 1.9% -5.4% -15.7% 25.2% 92.2%GfK SE 26.42 -14.5% -14.4% -20.7% -21.6% -34.3% -26.6% -16.4%Grammer AG 26.70 -2.3% -3.9% 12.7% -22.6% 39.5% 57.1% 34.6%Hawesko Holding AG 40.34 -2.7% -3.9% -0.9% 1.1% 1.6% 17.3% 122.6%Koenig & Bauer AG 30.30 -7.9% -8.0% 8.8% 175.3% 114.1% 75.1% 16.3%Leifheit AG 46.13 -6.8% -5.4% 0.5% -0.6% 50.6% 177.7% 161.9%LPKF Laser & Electronics AG 6.93 -3.8% -5.6% -18.0% -33.2% -19.9% -1.1% 125.4%Manz AG 29.96 -12.7% -15.8% -50.4% -52.7% 42.6% -36.9% n.a.Masterflex SE 5.50 -7.6% -7.8% -11.3% -21.8% 7.8% 35.8% -76.3%MLP AG 3.08 -16.2% -16.3% -25.7% -15.2% -49.0% -60.6% -83.4%PUMA SE 187.35 -5.7% -4.9% -4.6% 8.9% -21.2% -17.0% -27.6%QSC AG 1.55 2.8% 2.2% -8.1% -13.4% -29.1% -54.0% -63.5%R. STAHL AG 31.16 -6.1% -1.5% 0.5% -28.2% 8.0% 16.1% 19.8%Schaltbau Holding AG 50.35 -1.3% -1.3% 3.8% 11.3% 43.9% 155.6% 571.3%SGL CARBON SE 8.81 -31.9% -33.6% -47.4% -41.3% -72.3% -67.5% -40.6%SHW AG 23.00 -14.5% -19.2% -2.7% -44.7% -16.6% n.a. n.a.SÜSS MicroTec AG 8.47 1.4% 1.5% 31.4% 78.2% -9.9% -21.5% 31.9%technotrans AG 17.26 -10.6% -10.5% -3.0% 74.4% 120.2% 137.8% -9.4%TOM TAILOR Holding AG 4.34 -16.7% -8.8% -32.7% -60.4% -76.1% -72.1% n.a.Tomorrow Focus AG 3.13 -11.8% -10.5% -3.6% -15.4% -25.4% -16.5% 36.2%VIB Vermögen AG 16.72 -2.2% -1.7% -3.7% 5.4% 71.6% 107.6% 191.1%Villeroy & Boch AG 12.48 1.9% 0.7% -5.8% 2.8% 75.6% 161.1% 0.3%Wacker Neuson SE 12.26 -13.8% -13.3% -3.9% -29.9% 4.5% -1.0% n.a.WashTec AG 26.94 -11.7% -11.7% 5.2% 96.6% 206.1% 206.1% 104.1%windeln.de AG 9.43 -11.1% -8.9% -3.8% n.a. n.a. n.a. n.a.

Performance



EV/SALES MULTIPLES


Company 2015e 2016e 2017e

Adler Modemärkte AG 0,33 0,26 0,24Ahlers AG 0,67 0,54 0,53AIXTRON SE 3,00 1,26 1,06Amadeus FiRe AG 2,05 1,97 1,86Bastei Lübbe AG 1,05 0,93 0,80BAUER Aktiengesellschaft 0,71 0,66 0,62BayWa AG 0,28 0,26 0,25Borussia Dortmund GmbH & Co. KGaA 1,01 1,21 1,14Capital Stage AG 13,06 11,05 10,35CEWE Stiftung & Co. KGaA 0,77 0,59 0,54CHORUS Clean Energy AG 9,87 8,51 6,76comdirect bank AG n.a. n.a. n.a.DATRON AG 0,79 0,67 0,60Delticom AG 0,37 0,37 0,38Deutz AG 0,52 0,43 0,37DIC Asset AG n.a. 13,95 14,14euromicron AG 0,33 0,26 0,23Evotec AG 2,72 2,29 2,06Gerry Weber International AG 0,80 0,56 0,51Gesco AG 0,73 0,67 0,64GfK SE 1,03 0,76 0,67Grammer AG 0,33 0,33 0,30Hawesko Holding AG 0,78 0,73 0,68Koenig & Bauer AG 0,45 0,46 0,44Leifheit AG 0,98 0,92 0,89LPKF Laser & Electronics AG 1,97 1,58 1,45Manz AG 1,28 0,77 0,65Masterflex SE 1,03 0,92 0,83MLP AG n.a. n.a. n.a.PUMA SE 0,58 0,71 0,67QSC AG 0,71 0,74 0,72R. STAHL AG 1,01 1,05 0,99Schaltbau Holding AG 0,78 0,17 0,20SGL CARBON SE 1,90 1,34 1,30SHW AG 0,44 0,43 0,42SÜSS MicroTec AG 0,48 0,84 0,78technotrans AG 0,75 0,73 0,64TOM TAILOR Holding AG 0,36 0,32 0,29Tomorrow Focus AG 1,41 1,12 0,90VIB Vermögen AG 12,87 13,02 12,60Villeroy & Boch AG 0,66 0,64 0,60Wacker Neuson SE 0,77 0,75 0,67WashTec AG 1,30 1,23 1,16windeln.de AG 1,05 0,64 0,52

EV/ Sales



EV/EBIT MULTIPLES


company 2015e 2016e 2017e

Adler Modemärkte AG 12,42 5,51 4,55Ahlers AG 32,56 16,28 13,03AIXTRON SE -0,21 -9,61 4185,98Amadeus FiRe AG 12,40 12,40 12,40Bastei Lübbe AG 8,78 8,72 8,72BAUER Aktiengesellschaft 13,64 12,29 10,96BayWa AG 22,84 17,82 17,56Borussia Dortmund GmbH & Co. KGaA 21,21 31,24 19,19Capital Stage AG 21,74 18,15 17,93CEWE Stiftung & Co. KGaA 11,31 8,24 7,25CHORUS Clean Energy AG 26,27 26,27 26,27comdirect bank AG n.a. n.a. n.a.DATRON AG 9,74 6,72 5,31Delticom AG 23,33 12,50 9,10Deutz AG -0,24 88,23 26,30DIC Asset AG n.a. 16,65 26,87euromicron AG 10,74 6,39 4,85Evotec AG 24,95 92,56 82,86Gerry Weber International AG 9,63 6,39 5,33Gesco AG 13,12 11,72 9,79GfK SE 10,12 6,41 5,34Grammer AG 11,67 9,05 6,66Hawesko Holding AG 18,30 13,41 11,82Koenig & Bauer AG 13,99 9,28 9,09Leifheit AG 11,07 10,31 10,01LPKF Laser & Electronics AG 163,22 17,48 11,29Manz AG -0,10 27,32 8,90Masterflex SE 12,45 9,51 7,58MLP AG n.a. n.a. n.a.PUMA SE 22,18 22,21 16,84QSC AG -36,57 60,82 19,20R. STAHL AG 92,05 20,31 18,04Schaltbau Holding AG 8,65 1,85 2,16SGL CARBON SE -26,01 328,07 69,41SHW AG 9,49 9,90 9,55SÜSS MicroTec AG 20,94 19,27 12,67technotrans AG 9,92 8,62 6,67TOM TAILOR Holding AG 17,73 10,72 6,91Tomorrow Focus AG -0,05 -51,73 10,58VIB Vermögen AG 13,73 16,22 15,91Villeroy & Boch AG 12,20 12,20 12,20Wacker Neuson SE 10,18 9,72 8,21WashTec AG 13,12 13,12 13,12windeln.de AG -10,98 -10,98 -10,98

EV/ EBIT



DIVIDEND YIELD



Adler Modemärkte AG 2,96% 5,48% 6,58%Ahlers AG 2,15% 4,79% 6,16%AIXTRON SE 0,00% 0,00% 0,00%Amadeus FiRe AG 4,60% 5,10% 5,40%Bastei Lübbe AG 4,30% 4,70% 5,00%BAUER Aktiengesellschaft 1,44% 2,78% 4,17%BayWa AG 2,49% 3,27% 3,45%Borussia Dortmund GmbH & Co. KGaA 1,48% 1,27% 2,55%Capital Stage AG 2,34% 3,31% 3,31%CEWE Stiftung & Co. KGaA 2,70% 3,40% 3,50%CHORUS Clean Energy AG 0,00% 2,10% 2,60%comdirect bank AG n.a. 3,03% 3,03%DATRON AG 1,54% 2,09% 2,62%Delticom AG 1,51% 2,75% 3,85%Deutz AG 1,94% 2,34% 2,34%DIC Asset AG n.a. 4,02% 4,02%euromicron AG 0,00% 0,00% 1,43%Evotec AG 0,00% 0,00% 0,00%Gerry Weber International AG 3,32% 6,73% 7,63%Gesco AG 2,45% 2,86% 3,31%GfK SE 1,89% 2,65% 2,84%Grammer AG 2,79% 3,00% 3,56%Hawesko Holding AG 2,48% 2,48% 2,48%Koenig & Bauer AG 0,00% 1,73% 1,63%Leifheit AG 4,15% 4,55% 4,88%LPKF Laser & Electronics AG 0,00% 1,68% 2,65%Manz AG 0,00% 0,00% 0,00%Masterflex SE 0,00% 0,00% 0,00%MLP AG n.a. 6,50% 7,80%PUMA SE 0,33% 0,32% 0,43%QSC AG 2,69% 3,87% 5,80%R. STAHL AG -0,01% 1,54% 1,79%Schaltbau Holding AG 2,71% 2,48% 0,00%SGL CARBON SE 0,00% 0,00% 0,00%SHW AG 3,45% 2,61% 2,61%SÜSS MicroTec AG 0,00% 0,00% 0,00%technotrans AG 2,99% 3,42% 4,28%TOM TAILOR Holding AG 0,00% 0,00% 0,00%Tomorrow Focus AG 0,00% 0,00% 1,60%VIB Vermögen AG 2,94% 3,29% 3,59%Villeroy & Boch AG 3,90% 4,00% 4,20%Wacker Neuson SE 3,41% 3,26% 4,08%WashTec AG 3,90% 4,80% 5,20%windeln.de AG 0,00% 0,00% 0,00%

Dividend yield



PE RATIOS



Adler Modemärkte AG 24,34 9,64 8,35Ahlers AG 37,23 20,43 15,42AIXTRON SE -11,36 -23,42 530,22Amadeus FiRe AG 19,36 19,64 18,43Bastei Lübbe AG 12,68 10,72 8,35BAUER Aktiengesellschaft 12,40 9,02 7,72BayWa AG 13,66 11,00 10,82Borussia Dortmund GmbH & Co. KGaA 65,32 54,56 33,12Capital Stage AG 16,88 14,72 14,55CEWE Stiftung & Co. KGaA 14,17 13,13 12,17CHORUS Clean Energy AG 17,41 14,14 12,01comdirect bank AG 21,73 19,05 19,51DATRON AG 15,81 11,68 9,46Delticom AG 40,48 19,82 13,60Deutz AG -132,39 270,10 29,96DIC Asset AG n.a. n.a. n.a.euromicron AG 12,72 7,13 5,31Evotec AG 44,57 170,41 137,51Gerry Weber International AG 10,80 9,38 8,09Gesco AG 15,90 14,19 11,89GfK SE 12,87 9,55 8,23Grammer AG 12,52 9,23 6,55Hawesko Holding AG 28,03 20,83 19,07Koenig & Bauer AG 20,30 11,55 12,28Leifheit AG 16,13 15,32 14,81LPKF Laser & Electronics AG -509,32 23,87 15,09Manz AG -4,92 32,80 10,02Masterflex SE 17,45 13,65 11,13MLP AG 15,65 9,74 8,45PUMA SE 71,52 51,42 36,34QSC AG -17,52 -101,52 30,16R. STAHL AG -6992,00 25,90 22,39Schaltbau Holding AG 16,17 12,94 10,35SGL CARBON SE -3,26 -25,64 -41,49SHW AG 9,13 11,63 11,88SÜSS MicroTec AG 87,68 40,55 26,34technotrans AG 18,65 14,62 11,69TOM TAILOR Holding AG -73,73 19,74 7,47Tomorrow Focus AG 3,88 -55,34 22,55VIB Vermögen AG 11,38 12,50 12,46Villeroy & Boch AG 12,73 11,75 10,91Wacker Neuson SE 12,59 11,69 9,90WashTec AG 16,64 15,01 14,19windeln.de AG -9,35 -13,07 -24,11

PE



PB RATIOS



Adler Modemärkte AG 5,58 6,23 6,82Ahlers AG 7,81 7,96 8,09AIXTRON SE 3,40 3,25 3,25Amadeus FiRe AG 8,54 8,49 8,71Bastei Lübbe AG 4,84 5,19 5,70BAUER Aktiengesellschaft 24,32 25,72 27,18BayWa AG 26,19 27,84 29,49Borussia Dortmund GmbH & Co. KGaA 3,11 3,13 3,20Capital Stage AG 3,57 3,85 4,12CEWE Stiftung & Co. KGaA 26,82 28,91 31,25CHORUS Clean Energy AG 11,58 9,04 9,63comdirect bank AG n.a. n.a. n.a.DATRON AG 5,54 6,21 7,02Delticom AG 4,44 5,11 5,95Deutz AG 4,05 3,99 4,02DIC Asset AG n.a. n.a. n.a.euromicron AG 15,93 16,91 18,23Evotec AG 1,28 1,30 1,33Gerry Weber International AG 10,20 10,88 11,51Gesco AG 57,43 59,96 63,65GfK SE 20,61 22,56 24,91Grammer AG 22,05 24,29 27,57Hawesko Holding AG 10,28 11,22 12,33Koenig & Bauer AG 15,91 18,53 20,47Leifheit AG 21,02 22,08 23,10LPKF Laser & Electronics AG 3,10 3,28 3,57Manz AG 19,74 20,65 23,64Masterflex SE 3,00 3,41 3,90MLP AG n.a. n.a. n.a.PUMA SE 110,44 113,58 118,14QSC AG 0,98 0,93 0,92R. STAHL AG 14,62 15,83 16,74Schaltbau Holding AG 19,63 22,47 26,23SGL CARBON SE 3,07 2,72 2,51SHW AG 18,65 19,83 21,16SÜSS MicroTec AG 6,17 6,38 6,71technotrans AG 7,90 8,62 9,51TOM TAILOR Holding AG 9,13 9,35 9,93Tomorrow Focus AG 2,90 2,84 2,98VIB Vermögen AG 16,20 16,58 16,32Villeroy & Boch AG 6,01 6,59 7,23Wacker Neuson SE 14,92 15,57 16,41WashTec AG 5,58 6,17 6,77windeln.de AG 4,41 3,69 3,30

PB



The authors

Equity Research – Small Caps

Christoph Schlienkamp, Investmentanalyst DVFA +49 (0)211 4952-311 [email protected]

Equity Strategy

Dr Ralf Zimmermann Head of Equity Strategy +49 (0)211 4952-841 [email protected]



Analyst declaration

The relevant research analysts, as named on the front cover of this research report, certify that (a) all of the views expressed in this research report accurately

reflect their personal views about the securities and companies mentioned in this research report; and (b) that no part of their compensation was, is or will be

directly or indirectly related to the specific recommendation(s) or views expressed by them in this research report.

Rating system

Shares are rated based upon analyst forecasts with regard to the performance of the share during a period of twelve months. The rating “Buy” within this

general concept means that the share’s forecast performance is at least 10%. “Hold” means a price movement in a bandwidth of -10% to 10%. “Sell” means

that the share’s forecast performance is less than -10%.

Explanation of valuation

Unless shown otherwise, the stated upside targets are based upon either a discounted cash-flow pricing or upon a comparison of the performance ratios of

companies that the respective analyst considers to be comparable, or upon a combination of these two analyses. Analysts modify the result of this

fundamental assessment to incorporate the potential trend in market sentiment.

Overview of changes in our recommendations/price targets in the previous twelve months for: AIXTRON SE (AIXA:GY), Close (25/01/2016): 3.51 EUR, Analyst: Dr. Karsten Iltgen (Analyst).

Date of publication Price at recommendation Rating Price target

11/12/2015 4.12 EUR Hold 6.00 EUR

09/10/2015 5.79 EUR Buy 10.00 EUR

20/02/2015 6.98 EUR Buy 12.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Adler Modemärkte AG (ADD GY), Close (25/01/2016): 9.12 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


17/12/2015 9.50 EUR Hold 10.00 EUR

13/05/2015 11.39 EUR Hold 12.50 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Ahlers AG (AAH3 GR), Close (25/01/2016): 7.30 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


01/07/2015 9.13 EUR Hold 9.00 EUR

11/03/2015 11.25 EUR Hold 11.50 EUR

Disclaimer



Overview of changes in our recommendations/price targets in the previous twelve months for: Amadeus FiRe AG (AAD GY), Close (25/01/2016): 67.42 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: Bastei Lübbe AG (BST GR), Close (25/01/2016): 6.98 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: BAUER Aktiengesellschaft (B5A GY), Close (25/01/2016): 14.39 EUR, Analyst: Marc Gabriel (CIIA, CEFA).


15/04/2015 16.53 EUR Hold 19.00 EUR

27/01/2015 16.44 EUR Buy 19.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: BayWa AG (BYW6 GY), Close (25/01/2016): 27.53 EUR, Analyst: Marc Gabriel (CIIA, CEFA).


12/08/2015 32.89 EUR Hold 36.00 EUR

24/04/2015 34.77 EUR Hold 40.00 EUR

27/01/2015 35.14 EUR Buy 40.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Borussia Dortmund GmbH & Co. KGaA (BVB GY), Close (25/01/2016): 3.93 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


02/03/2015 4.07 EUR Buy 5.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Capital Stage AG (CAP GY), Close (25/01/2016): 7.56 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


10/09/2015 8.63 EUR Buy 10.60 EUR

02/07/2015 6.43 EUR Buy 8.40 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: CEWE Stiftung & Co. KGaA (CWC GY), Close (25/01/2016): 48.51 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


07/04/2015 59.31 EUR Hold 60.00 EUR

25/02/2015 58.24 EUR Hold 58.00 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: CHORUS Clean Energy AG (CU1 GR), Close (25/01/2016): 9.50 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: comdirect bank AG (COM GR), Close (25/01/2016): 9.90 EUR, Analyst: Neil Smith (ACA).


22/01/2016 9.47 EUR Hold 10.00 EUR

21/07/2015 9.98 EUR Buy 11.00 EUR

11/02/2015 8.80 EUR Buy 9.50 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: DATRON AG (DAR GY), Close (25/01/2016): 9.55 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


11/03/2015 10.83 EUR Buy 12.50 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Delticom AG (DEX GY), Close (25/01/2016): 18.20 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


20/08/2015 22.50 EUR Hold 22.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Deutz AG (DEZ GY), Close (25/01/2016): 2.99 EUR, Analyst: Gordon Schönell (CIIA, CEFA).


17/09/2015 3.45 EUR Hold 3.50 EUR

29/07/2015 5.03 EUR Buy 6.40 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: DIC Asset AG (DIC GY), Close (25/01/2016): 8.70 EUR, Analyst: Dr. Georg Kanders (Analyst).


04/02/2015 9.49 EUR Buy 10.50 EUR

27/01/2015 8.97 EUR Buy 9.10 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: euromicron AG (EUCA GY), Close (25/01/2016): 7.00 EUR, Analyst: Wolfgang Specht (Analyst).


Overview of changes in our recommendations/price targets in the previous twelve months for: Evotec AG (EVT GY), Close (25/01/2016): 3.47 EUR, Analyst: Volker Braun.


13/08/2015 3.75 EUR Buy 4.60 EUR

02/07/2015 3.33 EUR Buy 4.50 EUR

16/06/2015 3.46 EUR Buy 5.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Gerry Weber International AG (GWI1 GY), Close (25/01/2016): 11.14 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


17/09/2015 15.06 EUR Hold 17.00 EUR

11/06/2015 20.53 EUR Hold 26.00 EUR

27/02/2015 33.63 EUR Buy 39.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Gesco AG (GSC1 GY), Close (25/01/2016): 66.49 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


01/07/2015 73.59 EUR Hold 70.00 EUR

22/05/2015 77.90 EUR Hold 78.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: GfK SE (GFK GY), Close (25/01/2016): 26.42 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


17/12/2015 34.26 EUR Buy 45.00 EUR

18/03/2015 36.85 EUR Hold 38.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Grammer AG (GMM GY), Close (25/01/2016): 26.70 EUR, Analyst: Christian Ludwig (CFA).


13/11/2015 22.93 EUR Buy 32.00 EUR

04/08/2015 25.25 EUR Buy 30.00 EUR

28/07/2015 26.26 EUR Buy 36.00 EUR

11/02/2015 35.85 EUR Buy 43.00 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: Hawesko Holding AG (HAW GY), Close (25/01/2016): 40.34 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


07/05/2015 40.00 EUR Sell 37.00 EUR

18/02/2015 39.99 EUR Sell 40.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Koenig & Bauer AG (SKB GY), Close (25/01/2016): 30.30 EUR, Analyst: Gordon Schönell (CIIA, CEFA).


15/10/2015 26.92 EUR Hold 29.00 EUR

24/03/2015 15.50 EUR Buy 19.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Leifheit AG (LEI GY), Close (25/01/2016): 46.13 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


24/04/2015 50.99 EUR Buy 60.00 EUR

18/02/2015 48.80 EUR Buy 55.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: LPKF Laser & Electronics AG (LPK GR), Close (25/01/2016): 6.93 EUR, Analyst: Dr. Karsten Iltgen (Analyst).


07/08/2015 8.70 EUR Buy 9.00 EUR

11/02/2015 9.66 EUR Buy 14.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Manz AG (M5Z GY), Close (25/01/2016): 29.96 EUR, Analyst: Dr. Karsten Iltgen (Analyst).


30/10/2015 42.00 EUR Hold 45.00 EUR

02/10/2015 62.83 EUR Hold 70.00 EUR

03/07/2015 62.62 EUR Buy 90.00 EUR

14/04/2015 92.99 EUR Buy 111.00 EUR

31/03/2015 74.34 EUR Buy 95.00 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: Masterflex SE (MZX GR), Close (25/01/2016): 5.50 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: MLP AG (MLP GY), Close (25/01/2016): 3.08 EUR, Analyst: Andreas Schäfer (Analyst).


20/11/2015 3.79 EUR Hold 4.00 EUR

14/07/2015 3.87 EUR Buy 5.00 EUR

20/02/2015 3.64 EUR Buy 4.20 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: PUMA SE (PUM GY), Close (25/01/2016): 187.35 EUR, Analyst: Peter Steiner (CFA).


09/07/2015 151.95 EUR Sell 133.00 EUR

17/02/2015 178.85 EUR Hold 180.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: QSC AG (QSC GR), Close (25/01/2016): 1.55 EUR, Analyst: Wolfgang Specht (Analyst).


26/11/2015 1.49 EUR Buy 2.20 EUR

27/01/2015 1.82 EUR Buy 2.50 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: R. STAHL AG (RSL2 GY), Close (25/01/2016): 31.16 EUR, Analyst: Gordon Schönell (CIIA, CEFA).


08/10/2015 32.82 EUR Hold 29.00 EUR

30/07/2015 38.60 EUR Hold 35.00 EUR

24/04/2015 40.20 EUR Hold 41.00 EUR

08/04/2015 41.18 EUR Hold 44.00 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: Schaltbau Holding AG (SLT GR), Close (25/01/2016): 50.35 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: SGL CARBON SE (SGL GY), Close (25/01/2016): 8.81 EUR, Analyst: Marc Gabriel (CIIA, CEFA).


09/12/2015 13.83 EUR Sell 9.00 EUR

30/01/2015 14.21 EUR Sell 11.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: SHW AG (SW1 GY), Close (25/01/2016): 23.00 EUR, Analyst: Christian Ludwig (CFA).


29/09/2015 22.52 EUR Hold 24.00 EUR

14/09/2015 32.51 EUR Buy 40.00 EUR

18/02/2015 42.95 EUR Buy 52.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: SÜSS MicroTec AG (SMHN:GR), Close (25/01/2016): 8.47 EUR, Analyst: Dr. Karsten Iltgen (Analyst).


07/07/2015 5.60 EUR Hold 6.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: technotrans AG (TTR1 GY), Close (25/01/2016): 17.26 EUR, Analyst: Gordon Schönell (CIIA, CEFA).


19/05/2015 16.27 EUR Buy 20.00 EUR

11/03/2015 11.69 EUR Buy 15.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: TOM TAILOR Holding AG (TTI GY), Close (25/01/2016): 4.34 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


19/06/2015 9.91 EUR Buy 12.00 EUR

19/02/2015 12.40 EUR Buy 16.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Tomorrow Focus AG (TFA GY), Close (25/01/2016): 3.13 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


10/11/2015 3.52 EUR Hold 3.90 EUR

01/04/2015 5.00 EUR Hold 5.00 EUR



Overview of changes in our recommendations/price targets in the previous twelve months for: VIB Vermögen AG (VIH GY), Close (25/01/2016): 16.72 EUR, Analyst: Dr. Georg Kanders (Analyst).


13/04/2015 17.81 EUR Buy 19.50 EUR

10/02/2015 15.96 EUR Buy 18.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: Villeroy & Boch AG (VIB3 GR), Close (25/01/2016): 12.48 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: Wacker Neuson SE (WAC GR), Close (25/01/2016): 12.26 EUR, Analyst: Marc Gabriel (CIIA, CEFA).


23/10/2015 12.50 EUR Buy 16.00 EUR

06/08/2015 17.07 EUR Buy 24.00 EUR

26/03/2015 22.53 EUR Buy 25.00 EUR

11/03/2015 21.03 EUR Buy 24.00 EUR

26/01/2015 17.48 EUR Buy 20.00 EUR

Overview of changes in our recommendations/price targets in the previous twelve months for: WashTec AG (WSU GR), Close (25/01/2016): 26.94 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


Overview of changes in our recommendations/price targets in the previous twelve months for: windeln.de AG (WDL GR), Close (25/01/2016): 9.43 EUR, Analyst: Christoph Schlienkamp (Investmentanalyst DVFA).


The distribution of recommendations in our investments universe is currently as follows (date: 01/01/2016) Rating Basis: all analysed companies Basis: companies with investment banking relationships

Buy 54.0% 37.5% Hold 42.6% 62.5% Sell 4.4% 0.0% Under Review 0.0% 0.0%

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Conflict of interest

Disclosures of potential conflicts of interest relating to Bankhaus Lampe KG, its affiliates and subsidiaries in the following companies named in this research

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Company Disclosure

AIXTRON SE ---

Adler Modemärkte AG ---

Ahlers AG ---

Amadeus FiRe AG 6

Bastei Lübbe AG ---

BAUER Aktiengesellschaft 6

BayWa AG ---

Borussia Dortmund GmbH & Co. KGaA ---

Capital Stage AG 6

CEWE Stiftung & Co. KGaA ---

CHORUS Clean Energy AG ---

comdirect bank AG 6

DATRON AG 5

Delticom AG ---

Deutz AG ---

DIC Asset AG 4

euromicron AG ---

Evotec AG 6

Gerry Weber International AG 7

Gesco AG ---

GfK SE ---

Grammer AG 5

Hawesko Holding AG ---

Koenig & Bauer AG ---

Leifheit AG 6

LPKF Laser & Electronics AG ---

Manz AG 2, 4

Masterflex SE ---

MLP AG ---

PUMA SE ---

QSC AG ---

R. STAHL AG 5

Schaltbau Holding AG ---

SGL CARBON SE ---

SHW AG ---

SÜSS MicroTec AG ---

technotrans AG 5

TOM TAILOR Holding AG 2

Tomorrow Focus AG ---

VIB Vermögen AG 6

Villeroy & Boch AG ---

Wacker Neuson SE ---

WashTec AG ---

windeln.de AG ---

2. Bankhaus Lampe KG or an affiliated company regularly deals in this company’s shares.



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appointed) a Member of the Board of Management or Supervisory Board of this company.

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28 January 2016



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