Today’s Headlines
· Minister of Finance analyses 12 tax cuts and 12 measures for wage hikes totaling EUR 1.45bn
· Greece to tap the markets with EUR8-10bn in 2025 (press)
· Involved parties to meet today for the Greek-Cyprus interconnection (press)
· HFSF to dispose a 10% stake in NBG-Press
· Piraeus Bank to issue new Tier 2 notes
· Aegean Airlines 2Q24 results Preview | Strong competition and increased OpEx trim profitability
· METLEN acquires a small construction company, MT ATE.
· Alpha Services and Holdings Share Buyback
· OTE sold Otesat-Maritel-Press
· OPAP Share buyback
· Fourlis results out today AMC
· AIA results out today AMC
· Ideal Holdings CC today
Market Comment
ATHEX headed south yesterday for a second consecutive session, underperforming the European stock markets. In more detail, the General Index slipped by 0.62% at 1,434.17 units (FTSE Large Cap: -0.65%, FTSE Mid Cap: -0.89%, Banks Index: -0.70%) and the traded value was shaped at EUR 57.4m, down from Friday’s EUR 74.2m. We expect the European markets to set the tone today, with Athens International Airport and Fourlis in focus.
Macro Headlines
Minister of Finance analyses 12 tax cuts and 12 measures for wage hikes totaling EUR 1.45bn
The political leadership of the Ministry of National Economy and Finance proceeded on Monday in the specialization of the government’s measures, announced by the Prime Minister in the Thessaloniki International Fair (TIF). The total amount of the measures, concerning 12 salary increases and 12 new tax reductions, amounts to EUR 1.45bn. Additionally, Mr. Hatzidakis expressed his optimism that the EU authorities will approve the government’s official request to increase the state expenditures ceiling to EUR 3.5bn (from EUR 3bn currently). In our view, the abovementioned support measures will not compromise the state budget surplus of >2% for 2024 and 2025, taking into account that in 7M24, the budget execution is recording a EUR 5,683m primary surplus (on a cash basis), well above the targeted surplus of EUR 1,655m.
Greece to tap the markets with EUR8-10bn in 2025 (press)
According to Kathimerini citing a relevant press report from Reuters, Greece plans to raise EUR8-10bn through T-bill and bond issuances next year, also to proceed with the early prepayment of bilateral debt from the bailout loans of EIR 7.93bn maturing in 2026-28.
Sector Headlines
Involved parties to meet today for the Greek-Cyprus interconnection (press)
According to Kathimerini, representatives from Greece, Cyprus, Nexans and the EU will hold a critical meeting today Tuesday to discuss the developments regarding the Greece-Cyprus interconnection.
Company Headlines
HFSF to dispose a 10% stake in NBG-Press
Press reports (euro2day) indicate that HFSF will dispose a 10% stake (91,471,515 shares) in National Bank of Greece at the end of September or first week of October. The same reports suggest that demand from institutional investors is strong and thus HFSF might dispose a stake up to 13% (118,912,970 shares) as well as that NBG won’t buy back shares from HFSF. We reiterate our Buy rating on NBG and TP of EUR 10.84/share.
Piraeus Bank to issue new Tier 2 notes
According to Bloomberg, Piraeus Bank has mandated global investment banks to issue new Tier 2 notes with a maturity of eleven years and callable in six. Piraeus will also proceed with a cash tender offer at 100.5% on its outstanding Tier 2 bond of EUR 500.0m issued on 19/2/20, with a coupon of 5.50% pa.
Aegean Airlines || CP: EUR 11.35 | Rating: Buy | TP: EUR 14.70
2Q24 results Preview | Strong competition and increased OpEx trim profitability
2Q24 results preview | Aegean Airlines is set to release 2Q24 results on Wednesday 11 September, AMC while it will hold a cc the following day (15.00 Athens time). We expect a strong quarter on top line thanks to favourable traveling environment and the record high passenger traffic in AIA. We forecast 2Q24 group revenues of EUR 485.4m (+ 8.1% y-o-y), EBITDA of EUR 111.8m (-7.0% y-o-y, affected by increased OpEx and higher CEO fleet maintenance costs) with the respective margin at 23.0% in 2Q24 vs. 26.8% in 2Q23. However, further down the P&L, we expect the higher depreciation cost, FX translation losses and financial expenses to weigh on net profits, with the respective figure down to EUR 39.9m vs. EUR 51.5m in 2Q23.
2Q24 Key forecasts
|
EUR m |
2Q23 |
2Q24e |
Y-o-Y |
1H23 |
1H24e |
Y-o-Y |
|
Revenues |
449.1 |
485.4 |
8.1% |
678.1 |
754.2 |
11.2% |
|
Operating Expenses |
(326.0) |
(373.6) |
14.6% |
(553.1) |
(607.2) |
9.8% |
|
EBITDA |
120.2 |
111.8 |
-7.0% |
139.5 |
147.0 |
5.4% |
|
mgn (%) |
26.8% |
23.0% |
-370bps |
20.6% |
19.5% |
-110bps |
|
Net Profit |
51.5 |
39.9 |
-22.6% |
37.0 |
21.0 |
-43.3% |
|
|
|
|
|
|
|
|
|
Key Statistics |
2Q23 |
2Q24e |
Y-o-Y |
1H23 |
1H24e |
Y-o-Y |
|
ASKs m |
5.278 |
5.789 |
9.7% |
8.601 |
9.534 |
10.8% |
|
Domestic passengers |
1.686 |
1.814 |
7.6% |
2.714 |
2.956 |
8.9% |
|
International passengers |
2.378 |
2.585 |
8.7% |
3.925 |
4.297 |
9.5% |
|
Total passengers |
4.064 |
4.399 |
8.2% |
6.639 |
7.253 |
9.2% |
|
Load factor |
81.2% |
81.8% |
Source: the Company, Optima bank research
Analysis | More specifically, revenues increase derived from scheduled activities as the company has focused on its core business to address the problem with the Neo family engines. We expect slight decrease in yield on tough comparable and also due to increased competition which puts pressure on load factors and pricing We project OpEX to sharply increase by 14.6% y-o-y affected by higher fleet maintenance costs towards the Ceo fleet, driving EBITDA margin down by -370 bps y-o-y to 23%.Finaly, we expect net profit down by c. 22.6% y-o-y, to EUR 39.9m further impacted by higher depreciation costs and financial expenses.
Comment | We expect another relative strong earnings announcement on the top line by Aegean Airlines, confirming our forecasts of a new record year in terms of revenues and passenger traffic. The results will be impacted by higher costs as more Neos are grounded and the company is facing higher maintenance costs of the less efficient CEO replacements. AA also announced a new investment participating with EUR 25m in the share capital increase of the low-cost carrier Volotea. Management highlighted that the agreement has a commercial partnership that adds value through codeshare flights, and the two companies will develop and expand the international network to/from Greek Regional airports, while agreement also include the cooperation in the provision of MRO and Flight Simulator Training services by AEGEAN’s Group. Looking ahead, strong July and August passenger data indicate a solid 3Q23e for Aegean; on the flip side, competition is expected to challenge yields and load factors, while higher OpEx will continue to trim profits.
METLEN acquires a small construction company, MT ATE.
METLEN announced that its construction subsidiary METKA agreed to acquire all shares of M.T. ATE for EUR 14m. MT ATE is a construction company established in 1998, which operates in the undertaking and construction of public and private technical projects, specializing in environmental projects. MT ATE recorded EBITDA and Net Profits of EUR 4.1m and EUR 2.75m respectively, implying a transaction EV/EBITDA (historical) of 3.67x and P/E of 5.1x. As a reminder, during METELEN’s AGM last June, the Company CEO and Chairman Mr. Mytilineos highlighted the growth prospects of METKA, expecting to double its profitability y-o-y in 2024 and 2025. Additionally, Mr Mytilineos had stated that by 2025e, when it reaches a critical mass, Construction subsidiary could be span off and be listed in ATHEX.
Alpha Services and Holdings Share Buyback
Alpha announced that during the period 2.9.2024 – 6.9.2024, it purchased a total of 1,480,843 own shares, with an average purchase price of EUR 1.5548/share and a total cost of EUR 2,302,412. The company now holds a total of 13,851,234 own shares or 0.59% of shares o/s.
OTE sold Otesat-Maritel-Press
Reportedly (euro2day), OTE sold its 94.08% stake in OTESAT-MARITEL to Orbyt Global for a cash consideration between EUR 8.0-10.0m. OTESAT provides satellite telecommunications in the Greek maritime market and generated revenues of EUR 23.3m and EBT of EUR 609k in 2023. The news is positive and expected.
OPAP Share buyback
OPAP purchased from 2 to 6 September, 116,026 own shares for a total amount of EUR 1,853,369.45 and at an average price of EUR 15.8751 per share. The company now holds 9,887,837 own shares or 2.67% of shares outstanding.
Fourlis results out today AMC
Fourlis Group is set to release the 1H24 results today after the market closing with a conference call scheduled for tomorrow at (17.00 Athens Time).
AIA results out today AMC
Athens International Airport is set to release the 1H24 results today after the market closing, with a conference call scheduled for tomorrow at (12.00 Athens time.)
Ideal Holdings CC today
The company will release 1H24 financial statements today and management will host a CC at 17:30 Athens/15:30 London Time.
Calendar of Events
Macros
10/09/24 | CPI AUG & Industrial Production JUL
13/09/24 | Evolution of Turnover of Enterprises JUL & Import Price Index in Industry JUL
13/09/24 | Moody’s – Greek sovereign credit review
20/09/24 | Current Account Balance JUL & Turnover Index in Industry JUL
27/09/24 | Economic Sentiment Indicator SEP & Building Activity JUN
2Q/1H24 Results Release
10/09/24 | Fourlis (Aft-mkt), Athens Airport (Aft-mkt)
11/09/24 | Aegean Airlines (Aft-mkt), ElvalHalcor (Aft-mkt)
12/09/24 | LAMDA Development (Aft-mkt), Alpha Trust Andromeda
16/09/24 | KRI-KRI (Bef -mkt)
17/09/24 | Noval Property
19/09/24 | Viohalco, Attica Bank, Alpha Real Estate, Lavipharm
20/09/24 | Premia Properties, Logismos
25/09/24 | ADMIE Holding (Bef-mkt), AS Company (Aft-mkt)
26/09/24 | EYDAP, INTERTECH, Loulis Food
27/09/24 | Piraeus Port Authority, Alpha Trust Holdings, Alumil (Aft-mkt), Biokarpet, Ble Kedros, Sunrise Mezz Plc, Thessaloniki Water Supply (Aft-mkt), Orilina Properties, Phoenix Vega Mezz PLC, Trastor REIC
30/09/24 | Epsilon Net (Bef-mkt), Galaxy Cosmos Mezz Plc, Space Hellas, Technical Olympic (Aft-mkt), Athens Medical Center, Interlife, Medicon, Pairis
EGM / AGM
10/09/24 | Epsilon Net (AGM), MED (AGM)
13/09/24 | Bank of Cyprus (EGM)
16/09/24 | Coca-Cola HBC AG (EGM)
17/09/24 | MED (EGM)
19/09/24 | Ideal Holdings (EGM)
25/09/24 | Attica Bank (EGM)
26/09/24 | Jumbo (EGM)
02/10/24 | Cenergy Holdings (EGM)
Ex-Dividend
11/09/24 | Orilina Properties (EUR 0.0228613745)
12/09/24 | Evrofarma (EUR 0.05)
11/10/24 | Ktima Lazaridis (EUR 0.03)
23/10/24 | ELVE (EUR 0.40)
04/11/24 | OPAP (interim dividend EUR 0.60)
Ex-Capital Return
12/09/24 | Unibios (EUR 0.02)
Initiation of trading of new shares
12/09/24 | Attica Bank (5.557.131 shares from the merger by absorption of Pancreta Bank)
ATHEX Companies Presentations (Hellenic Fund & Asset Management Association)
10/09/24 | Hellenic Exchanges (10:00 GR Time)
17/09/24 | KRI-KRI (08:45 GR Time)
Research Department
Equity Research
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