CABB – Q4 20 trading update.
All,
Please refer to our unchanged analysis here.
The company continues to perform very well and we may be shelving our coverage of CABB as a result.
Top Line and Margins:
The boom in agricultural commodities and the agrichem sector continues to lift CABB’s revenue and margins, particularly on the custom manufacturing side, a trend that is likely to continue for some time.
Operational Risks:
The limited impact of the recent Pratteln fire suggests that the company has significantly strengthened its insurance and risk mitigation policies. This may reflect some real learning from the part of the company, after previous episodes in 2018 and before, which had a much more damaging impact on liquidity, EBITDA and leverage.
Financials:
CABB released a short, one-pager statement with few details. Revenues for FY2020 of EUR510m and post-IFRS16 EBITDA of EUR112m were mostly in line with our expectations. Liquidity at YE2020 amounted to EUR116m, which includes undrawn facilities of EUR65m, and is sufficient to its needs.
Feel free to reach out if you would like to exchange ideas on the name.
Juliano
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E: jtorii@sarria.co.uk
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