Market Comment
ATHEX headed north yesterday, outperforming the European stock markets. In more detail, the General Index rose by 0.23% at 1,617.56 units (FTSE Large Cap: +0.27%, FTSE Mid Cap: +0.80%, Banks Index: +0.30%) and the traded value was shaped at EUR 124.4m, down from Wednesday’s EUR 150.8m. We expect the market to consolidate today, with Metlen and Jumbo in focus.
Today’s Headlines
· Current account deficit widens in December (BoG)
· Industrial Turnover index up by 5.7% in December (ELSTAT)
· METLEN 4Q/FY24 Results Review | MYTILINEOS delivers the Annual EBITDA guidance; Declares EUR 1.50/share dividend; CC Highlights: Guides for 2028e EBITDA at EUR >2bn, London Listing in 3Q25e, to hold a capital markets day on 18 April with announcements of new corporate actions
· Piraeus Financial Holdings 4Q24 results preview | A soft quarter on one-offs but Piraeus to deliver FY target, focus on new BP 25-28
· Jumbo to distribute EUR 0.4724 per share as extraordinary dividend
· Intralot signed a new VLT contract in Nebraska
· AVAX and Ballian undertake the renovation of Intercontinental Hotel (press)
Macro Headlines
Current account deficit widens in December (BoG)
According to BoG provisional data, Greece’s current account balance in December 2024 recorded a deficit of 3,602m, vs. a deficit of 2,918m in the same period a year ago, due to the deterioration of the secondary income (it is noted that the secondary income account in December 2023 had seen the disbursement of the third tranche by the RRF), which more than offset the improvement of the services and the goods balance.
Additionally, in 2024, the current account deficit widened by EUR 1,195m and stood at EUR 15,126m. Finally, travel receipts in December 2024 stood at EUR 435m, up by 33.3% y-o-y, while in the Jan-December 2024 period, travel receipts rose by 5.4% y-o-y to EUR 21,702m.
Comment: the 33.3% higher travel receipts during the month imply the extension of the Greek tourism season, and were driven by the increased by 15.3% international tourist flows during the month, and to the c.15% higher spending per traveller during the month. However, current account deficit widened by 8.6% y-o-y in 2024, reaching c. 6.6% of GDP (from 6.1% in 2023), above the 4.0% excessive deficit threshold according to IMF, due to the deterioration of the goods basket, on lower y-o-y exports and higher y-o-y imports.
Industrial Turnover index up by 5.7% in December (ELSTAT)
ELSTAT has announced that Greece’s Turnover Index in Industry (both domestic and non-domestic market) increased by 5.7% y-o-y in December 2024 compared to a decrease of 6.5% y-o-y in December 2023 while increased by 4.3% m-o-m. The average Turnover Index in Industry in the January 2024-December 2024 period increased by 2.0% y-o-y compared to a 3.6% y-o-y decrease in the respective January 2023-December 2023 period.
Company Headlines
METLEN (Mytilineos) || BUY | CP: EUR 36.34 | TP: EUR 49.00
4Q/FY24 Results Review | MYTILINEOS delivers the Annual EBITDA guidance; Declares EUR 1.50/share dividend; CC Highlights: Guides for 2028e EBITDA at EUR >2bn, London Listing in 3Q25e, to hold a capital markets day on 18 April with announcements of new corporate actions
METLEN released yesterday its 4Q/FY24 results, with 4Q24 group turnover at EUR 1.480m (+5.4% YoY), EBITDA of EUR 317m (+8.9% YoY, 2.6% above Optima) and Net income of EUR 133m (-17.4% YoY, -9.5% below Optima, due to increased depreciation charges and financial expenses). Regarding Leverage, Net Debt at 2024-end stood at EUR 1,776m, implying a Net Debt/EBITDA of 1.7x, adjusted for non-recourse debt). In FY24 terms METLEN reported Revenues of EUR 5.7bn, EBITDA at EUR 1,080m in a EUR 753/297m energy/metals split, and Net profits at EUR 615m. Following the strong profitability, METLEN declared dividend for FY24 at EUR 1.50/share (vs. our 1.54/share estimate).
Mytilineos 4Q/FY24 Results Review
|
EUR m |
4Q23 |
4Q24 |
YoY |
Optima |
Actual vs. Optima |
FY23 |
FY24 |
YoY |
|
Group Revenues |
1,404 |
1,480 |
5.4% |
1,681 |
-12.0% |
5,492 |
5,683 |
3.5% |
|
– Energy EBITDA |
234 |
208 |
-11.1% |
214 |
-2.8% |
766 |
753 |
-1.7% |
|
– Metallurgy EBITDA |
55 |
90 |
63.6% |
65 |
38.5% |
248 |
297 |
19.8% |
|
– Construction/Concessions |
8 |
31 |
675.0% |
23 |
34.8% |
18 |
50 |
>100% |
|
Group EBITDA |
291 |
317 |
8.9% |
309 |
2.6% |
1,014 |
1,080 |
6.5% |
|
Net Income |
161 |
133 |
-17.4% |
147 |
-9.5% |
623 |
615 |
-1.3% |
Source: Optima bank Research, Metlen
Below is an analysis per division for FY24:
· Energy: The unit registered marginal increase in revenue (+3% y-o-y to EUR 4,572m) representing 81% of the Company’s total turnover, while EBITDA dropped marginally by -1.7% YoY to EUR 753m), due to the significant drop of the Natural Gas & LNG supply & trading Business Unit, which contributed EUR 57m EBITDA (from EUR 192m in 2023), and the weaker contribution from M Power projects of EUR 39m (from EUR 97m in 2023).
On the other Hand, Renewables Business Unit continued growing at a fast pace, with segmental EBITDA at 349m (from EUR 240m last year) and the Electricity Busines (both generations & Supply) generated EUR 308m EBITDA, from EUR 237m last year. With respect to Renewables, operational portfolio recorded dynamic expansion, reaching the 1.4GW of installed capacity by the end of the year, surpassing the 1 GW milestone for the first time. Overall, METLEN’s global portfolio exceeded the 11.1 GW, marking a total increase of c.0.6 GW compared to the beginning of the year.
The portfolio incorporates 4.9GW of operational and mature stage of development projects, as well as 6.2GW of projects in early stages of development.
Finally, with regards to M Power projects sub sector, the backlog of contracted projects in 2024-end amounted to EUR 1.1bn, an activity which is expected to grow significantly, while the resources of the European Recovery Fund offer further growth prospects, with Greece being the country that receives the highest funding as a percentage of GDP.
· Metals: Following the correction in 2023, average Aluninium’s price (LME 3M) rose by 7.16% y-o-y in 2024 to $ 2,456/tn, and more importantly, Aluminum billet premia showed a significant increase, from the $350/tn level, at the beginning of 2024, to $550/tn at the end of the year. Supported by the stronger pricing environment in 2024, Mytilineos reported Metals sales down by 9% y-o-y to 857m, while EBITDA was up by 19.7% to EUR 297m in 2024.
· Construction/concessions): Regarding the construction activity, segmental EBITDA contribution in 2024 amounted to EUR 50m compared to EUR 18m in 2023. At the end of 2023, the backlog of infrastructure projects in progress exceeds EUR 1bn, while including projects that are in an advanced stage of contracting, it reaches EUR 1.4bn. The prospects for the construction industry in Greece is positive, especially for concession and Public & Private Partnerships (PPP), in which the Infrastructure Sector (METKA ATE and M Concessions) aspires to play a leading role.
Conference call Highlights: a) will hold a Capital Markets day in London on April 18 to present the next day for the Company, b) guides for 2028e EBITDA at > EUR 2bn, without any M&As and with lighter capex needs going forward compared to 2024! c) will announce two new corporate actions (M&As?) during the upcoming capital markets day, d) new investments to underpin growth in the medium term d) expects lower net debt and financial expenses in 2025e, e) expects higher RES sales going forward than the 1GW during 2024, f) expects the listing in London to take place in 3Q25e
Comment: All in, METLEN delivered its financial guidance for 2024 (EBITDA of EUR 1-1.2bn, Net Profits at EUR 600-700m), despite the adverse business environment in the LNG trading and the M Power projects units, leveraging on its differentiated business model.
Taking into account the positive outlook FOR 2025e and also in the medium term, the new investment in the Metals segment (which will increase Alumina capacity by 50% and will launch Gallium production from 2027 onwards), the attractive valuation (METLEN currently trades at a 6.6x EV/EBITDA and 7.6x P/E for 2025e) and the expected listing of the stock under London’s FTSE 100 we reiterate our Buy recommendation for the stock, with the Target Price at EUR 49.0/share.
Piraeus Financial Holdings | CP: EUR 4.7480 | Rating: BUY | TP: EUR 6.20
A soft quarter on one-offs but Piraeus to deliver FY target, focus on new BP 25-28
4Q24 results preview | Piraeus Financial Holdings is scheduled to release 4Q24 results and the new Business Plan over 2025-2028 on Monday 24 February, before the opening of ATHEX and management will host a conference call on the same day at 14:00 Athens/12:00 London Time. We anticipate a softer bottom-line q-o-q, burdened by one-off costs of EUR 137.1m, of which EUR 79.3m for VSS and school contribution as well as an NPE clean-up cost of EUR 57.9m, bringing the NPE ratio down to 2.9%, in line with Spanish banks. Balance sheet dynamics are expected to be in line with system trends, i.e., higher performing loans due to strong NCE and deposit balances.
2024 results | We forecast that reported net profit will reach EUR 1.03bn (+31% y-o-y), despite one-off costs of EUR 95.0m (VSS, school contribution) and NPE clean-up costs of EUR 70.0m. We expect NII to shape at EUR 2.1bn (+5% y-o-y) and fee income at EUR 639.6m (+17% y-o-y). We also expect OpEx to rise by 7% y-o-y, on higher one-off costs (+67% y-o-y), whilst LLPs to tumble by 51% y-o-y. Hence, we estimate that reported net profit will reach EUR 1.03bn (+31% y-o-y) and normalized EPS adj. for AT1 cpn (excluding one-off items) will reach EUR 0.91, in line with management guidance on 01 November of EUR >0.90. Finally, we estimate that the remuneration to shareholders will accelerate to EUR 0.289/share vs. EUR 0.063/share in 2023, implying a gross yield of 6.2%.
4Q24 results | We project that reported net profit will reach EUR 149.9m (-53% q-o-q, -29% y-o-y) in 4Q24, lower than median consensus estimate of EUR 161.0m, on lower non-core revenues.
We estimate NII to shape at EUR 525.6m (-1% q-o-q, -2% y-o-y), in line with consensus estimate of EUR 525.0m. We also forecast fee income to reach EUR 159.2m (+2% q-o-q, +11% y-o-y), thanks to better market conditions and NCE. We also expect non-core revenues of just EUR 3.7m in the quarter.
All in all, we estimate top line to reach EUR 688.5m (-3% q-o-q, -5% y-o-y). On the cost side, we assess that OpEx will increase by 48% q-o-q to EUR 306.8m, burdened by one-off costs of EUR 79.3m (VSS, school contribution). Thus, we expect PPI to reach EUR 381.7m (-24% q-o-q, -17% y-o-y) and loan loss provisions to shape at EUR 119.0m (+130% q-o-q, +14% y-o-y).
Optima view | We believe that investors will focus on the new business plan over 2025-2028. The stock is trading 0.79x P/TBV25E, at 31% discount to European banks and 11% discount to its Greek peers, which is not justified in our view, given its high RoaTBV profile. Piraeus is our top pick in the sector.
|
(EUR m) |
Optima 4Q24e |
3Q24 |
QoQ |
4Q23 |
YoY |
Cons 4Q24e |
QoQ |
Optima vs Cons |
|
|
Net Interest Income |
525.6 |
529.5 |
-1% |
536.6 |
-2% |
525.0 |
-1% |
0.1% |
|
|
Fee income |
159.2 |
155.9 |
2% |
143.6 |
11% |
159.0 |
2% |
0.1% |
|
|
Core income |
684.8 |
685.4 |
0% |
680.3 |
1% |
684.0 |
0% |
0.1% |
|
|
Non-core Revenues |
3.7 |
23.3 |
-84% |
41.7 |
-91% |
18.0 |
-23% |
-79.4% |
|
|
Total revenues |
688.5 |
708.7 |
-3% |
722.0 |
-5% |
701.0 |
-1% |
-1.8% |
|
|
Operating Expenses |
(306.8) |
(207.6) |
48% |
(259.8) |
18% |
(252.0) |
21.4% |
21.7% |
|
|
One-offs, VSS cost |
(79.3) |
(1.8) |
– |
(63.6) |
25% |
(40.0) |
– |
||
|
Pre-Provision Profit |
381.7 |
501.1 |
-24% |
462.2 |
-17% |
447.0 |
-11% |
-14.6% |
|
|
LLPs |
(119.0) |
(51.7) |
130% |
(104.5) |
14% |
(117.0) |
126% |
1.7% |
|
|
NPE clean-up cost |
(57.9) |
0.0 |
– |
(51.5) |
12% |
(60.0) |
-3.6% |
||
|
Reported Net Profit |
149.9 |
318.4 |
-53% |
211.2 |
-29% |
161.0 |
-49% |
-6.9% |
source: Optima bank estimates, Company Median consensus estimate
|
(EUR m) |
Optima 2024e |
2023 |
YoY |
|
Net Interest Income |
2,100.3 |
2,002.7 |
5% |
|
Fee income |
639.6 |
546.6 |
17% |
|
Core income |
2,739.9 |
2,549.3 |
7% |
|
Non-core Revenues |
(24.8) |
64.6 |
– |
|
Total revenues |
2,715.1 |
2,613.9 |
4% |
|
Operating Expenses |
(920.0) |
(863.1) |
7% |
|
One-offs, VSS cost |
(95.0) |
(56.7) |
|
|
Pre-Provision Profit |
1,795.0 |
1,750.8 |
3% |
|
LLPs |
(272.5) |
(558.6) |
-51% |
|
NPE clean-up cost |
(70.0) |
(253.1) |
-72% |
|
Reported Net Profit |
1,031.1 |
788.1 |
31% |
source: Optima bank estimates, Company
Jumbo to distribute EUR 0.4724 per share as extraordinary dividend
The company announced that it will hold an EGM on 19 March to approve the distribution of an extraordinary cash dividend of EUR 0.4667 per share. Considering the 1,633,919 own shares the company currently owns the gross amount per share corresponds to EUR 0.4724. Following the EGM approval the dividend ex-date is set for 24 March. (DY: 1.7% *excluding own shares).
Intralot signed a new VLT contract in Nebraska
Intralot announced that its 100% US subsidiary, Intralot Inc has signed a contract with the Charitable Gaming Division of the Nebraska Department of Revenue for the provision of a real-time monitoring and reporting system for cash devices across the state. The contract will run for 5 years and includes the option to renew for four (4) additional two-year (2) periods, totaling 13 years. Intralot’s system will oversee and report on Cash Device operations in a growing statewide landscape of at least 5,000 devices at more than 1,600 locations in Nebraska, improving security, compliance, and operational transparency. The news is positive, as VLT contracts enjoy high EBITDA margins.
AVAX and Ballian undertake the renovation of Intercontinental Hotel (press)
According to Powergame.gr, the AVAX-Ballian Joint Venture undertook a EUR 43.7m contract for the renovation of the Intercontinental Hotel in Athens.
Calendar of Events
Macros
26/02/25 | Building Activity NOV (ELSTAT)
27/02/25 | Economic Sentiment Indicator FEB
28/02/25 | Producer Price Index in Industry JAN & Turnover Index in Retail Trade DEC
4Q/FY24 Results Release
24/02/25 | Piraeus Financial Holdings (Bef-mkt), Athens International Airport (Bef-mkt)
26/02/25 | OTE (Bef-mkt)
27/02/25 | HELLENiQ ENERGY (Aft-mkt), Eurobank Holdings (Aft-mkt), IDEAL Holdings (Bef-mkt)
28/02/25 | National Bank of Greece (Bef-mkt), Alpha Services & Holdings (08:00 GR time), Premia Properties
04/03/25 | ElvalHalcor (Aft-mkt)
05/03/25 | Cenergy Holdings
06/03/25 | Optima bank (Bef-mkt), Viohalco
10/03/25 | Attica Bank (Aft-mkt)
12/03/25 | Sarantis (Aft-mkt), Autohellas (Bef-mkt)
19/03/25 | OPAP (Aft-mkt)
26/03/25 | PPC (Aft-mkt), LAMDA Development (Aft-mkt)
27/03/25 | Titan Cement International
31/03/25 | Hellenic Exchanges (Aft-mkt), AUSTRIACARD Holdings (Aft-mkt)
25/04/25 | Biokarpet
28/04/25 | Alumil
30/04/25 | Motodynamics
EGM / AGM
26/02/25 | Attica Bank (EGM)
06/03/25 | EVROPI Holdings (EGM)
19/03/25 | Jumbo (EGM)
14/04/25 | Athens Airport (AGM)
28/04/25 | Sarantis (AGM)
29/04/25 | Optima bank (AGM), OPAP (AGM)
30/04/25 | Eurobank (AGM)
08/05/25 | Titan Cement (AGM)
16/05/25 | Bank of Cyprus (AGM)
27/05/25 | Cenergy Holdings (AGM), Viohalco (AGM)
30/05/25 | National Bank of Greece (AGM)
03/06/25 | METLEN (AGM)
05/06/25 | OTE (AGM), IDEAL Holdings (AGM)
06/06/25 | Premia Properties (AGM)
12/06/25 | Motodynamics (AGM)
18/06/25 | Biokarpet (AGM)
24/06/25 | AUSTRIACARD Holdings (AGM)
25/06/25 | PPC (AGM)
25/07/25 | Alpha Services & Holdings (AGM)
Ex-Dividend
24/03/25 | Jumbo (extraordinary cash distribution EUR 0.4724)
23/04/25 | Athens Airport
02/05/25 | Sarantis
07/05/25 | OPAP
12/06/25 | Premia Properties
01/07/25 | AUSTRIACARD Holdings
03/07/25 | OTE
21/07/25 | PPC
Ex-Capital Return
07/03/25 | IDEAL Holdings (EUR 0.10/share)
24/03/25 | ELLAKTOR (EUR 0.85/share)
|
Research Department |
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