net profit (adj.)(m) 14.5% 14.8% 15.7% 101 110 126 jumbo...
TRANSCRIPT
Jumbo
Greece/ General Retailers Company update
Produced by: All ESN research is available on Bloomberg (“ESNR”), Thomson-Reuters, Capital IQ, FactSet
Distributed by the Members of ESN (see last page of this report)
Investment Research Reason: Company Results 2 October 2014
Robust performance to continue in FY14/15; ‘Buy’ remains
We have reduced our target price to EUR 13.20/share (vs. EUR 14.30/share
previously) to reflect the negative impact of currency headwinds (weak euro
against the US dollar) on group’s earnings performance in the medium-term. We
maintain our ‘Buy’ rating, as the stock currently trades 32% below our revised
target price, while its attractive investment case has remained unchanged.
Solid performance in FY13/14 to continue in FY14/15: Jumbo’s performance in
FY13/14 has been impressive both in terms of sales and earnings. Revenue growth
accelerated to +8% y-o-y in FY13/14 due to the combined effect of store expansion
and improved consumer sentiment in all countries and especially in Greece. On the
profitability front, the company reported all-time high EBITDA and net profits on
growing sales and currency tailwinds that boosted group’s gross margin by 80bps
y-o-y. The management will continue its successful strategy in FY14/15 targeting to
open 6 new stores, 3 of which in Romania, while the trading figures in July-August
2014 were impressive revealing a more than 10% y-o-y sales increase.
Management remained cautiously optimistic for FY14/15: However, the
management remained conservative once again, guiding for sales growth between
4%- 6% and net earnings between EUR 90-95m for FY14/15. Excluding the impact
of any unforeseen one-off items, management’s guidance FY14/15 reflects its
concerns over the macro environment in the home country in the context of an
unstable political environment, as well as FX fluctuations (weaker euro vs. the US
dollar). However, we believe that the company can successfully cope with these
headwinds based on an efficient margin management (changes in the pricing
policy, early stocking, favourable sales mix) and its strong market position.
Earnings revision: We have raised our revenue estimates to better reflect group’s
positive sales momentum (see 2-month sales figures) but downward adjusted our
assumptions on gross margin to take into account the recent depreciation of the
euro against the US dollar. We have downgraded our EBITDA estimates by 4% for
FY14/15 and by 3% for FY15/16, which lead to a 2% reduction in our net earnings
forecasts for both fiscal years. Despite our more cautious stance on Jumbo’s
earnings performance, we still expect strong growth momentum. In particular, we
look for EBITDA of EUR 159m (+9% y-o-y) in FY14/15 and EUR 180m (+13% y-o-
y) in FY15/16. In relation to the bottom line, we forecast net profits of EUR 110m
(+8% y-o-y) for FY14/15 and EUR 126m (+15% y-o-y) for FY15/16. On the whole,
we look for 11% net earnings CAGR over FY14-FY18e, resulting from accelerated
sales growth and increased operating leverage.
Valuation: On our numbers, Jumbo trades 11.6x its FY15e calendarized net
earnings or at a 32% discount against European retailers. Based on Jumbo’s
current price level, we understand that the market has placed a higher risk premium
on the stock to reflect current political turmoil (scenarios for snap elections) in
Greece. Given Jumbo’s solid investment case (i.e. EPS CAGR 14-18e of 11%, net
cash position of EUR 138m; 10% of current MCAP, FCF in the excess of EUR
100m by FY16/17, DPS CAGR 14-18e of 15%, increased geographical
diversification), the stock would be among ATHEX’s top performers when political
stability in the home country is restored.
Analyst(s): Dimitris Birbos +30 210 81 73 392 [email protected]
For important disclosure information, please refer to the disclaimer page of this report
Buy
10.00
closing price as of 01/10/2014
13.20
14.30from Target Price: EUR
Recommendation unchanged
Target price: EUR
Share price: EUR
Reuters/Bloomberg BABr.AT/BELA GA
Daily avg. no. trad. sh. 12 mth 421,731
Daily avg. trad. vol. 12 mth (m) 4,333.86
Price high 12 mth (EUR) 14.40
Price low 12 mth (EUR) 8.85
Abs. perf. 1 mth -11.5%
Abs. perf. 3 mth -15.3%
Abs. perf. 12 mth 12.9%
Market capitalisation (EURm) 1,361
Current N° of shares (m) 136
Free float 73%
Key financials (EUR) 06/14 06/15e 06/16e
Sales (m) 542 600 681
EBITDA (m) 147 159 180
EBITDA margin 27.0% 26.6% 26.5%
EBIT (m) 127 139 159
EBIT margin 23.5% 23.1% 23.3%
Net Profit (adj.)(m) 101 110 126
ROCE 14.5% 14.8% 15.7%
Net debt/(cash) (m) (122) (170) (224)
Net Debt Equity -0.2 -0.2 -0.2
Net Debt/EBITDA -0.8 -1.1 -1.2
Int. cover(EBITDA/Fin.int) (54.4) (63.7) (45.1)
EV/Sales 2.8 2.0 1.7
EV/EBITDA 10.3 7.5 6.3
EV/EBITDA (adj.) 10.3 7.5 6.3
EV/EBIT 11.8 8.6 7.2
P/E (adj.) 16.1 12.4 10.8
P/BV 2.2 1.6 1.5
OpFCF yield 5.3% 5.3% 6.2%
Dividend yield 1.8% 2.3% 2.6%
EPS (adj.) 0.74 0.81 0.93
BVPS 5.47 6.10 6.80
DPS 0.18 0.23 0.26
8
9
10
11
12
13
14
15
Sep 13 Oct 13 Nov 13 Dec 13 Jan 14 Feb 14 Mar 14 Apr 14 May 14 Jun 14 Jul 14 Aug 14 Sep 14
vvdsvdvsdy
JUMBO Stoxx General Retailers (Rebased)Source: Factset
Shareholders: Vakakis Apostolos-Evangelos 27%;
For company description please see summary table footnote
Jumbo
Page 2
CONTENTS
Investment Case ........................................................................................................ 3
Forecasts Revision ................................................................................................... 5
Valuation & Rating .................................................................................................... 9
DCF valuation 9
Sensitivity on DCF valuation 10
Risks to our Estimates and Valuation 10
Peer Group Analysis 11
FY 13/14 Results Review ........................................................................................ 12
Presentation to Greek institutional investors ..................................................... 15
ESN Recommendation System ............................................................................. 22
Stock Ratings ........................................................................................................... 23
Jumbo
Page 3
Investment Case
Jumbo reported record high sales and profits in FY13/14 capitalizing on the aggressive
expansion of its distribution network in Greece and abroad in the previous years and its
strong brand name, also benefiting from the gradual stabilization of the Greek economy and
currency tailwinds. In particular, revenues grew by 8% y-o-y to EUR 542m, beating
management’s initial expectation for 2%-4% by far. EBITDA shaped at EUR 146.5m, up by
9% y-o-y on a comparable basis, surpassing the historic high level of EUR 144.7m of
FY09/10. In relation to the bottom line, Jumbo surpassed the EUR 100m net earnings
milestone for the first time in its history.
Group successful strategy will continue in the current fiscal year (July 14 – June 15) which
involves: a) aggressive expansion of the distribution through the opening of 6 new stores
with special focus on the Romanian market (3 new stores) that will raise net selling capacity
by 16% y-o-y, according to our estimates, b) an efficient margin management through early
stocking and hedging against currency risks, and c) cost discipline across all business
areas. That said, we expect that Jumbo’s sales growth will accelerate in FY14/15 (+11% y-
o-y) surpassing the EUR 600m mark, while net profits are expected to grow by 8% y-o-y
shaping at EUR 110m in FY14/15.
In a press release dated July 8th, Jumbo revealed its targets for fiscal year 2014/2015 (July
2014 – June 2015): a) sales growth between 4% and 6%, b) net earnings between EUR 90-
95m and c) the opening of 4-5 stores, which has been revised to 6 store openings in
September. In our view, management’s financial targets seem rather conservative given: a)
the strong start to FY14/15 in sales terms (>10% y-o-y in July-August), b) the opening of 6
new stores during the current fiscal year (the first store in Northern Greece was opened in
August 2014 but with small contribution to 2-month sales performance), c) the fact that
FY13/14 net earnings came in at EUR 101m, which means that the company expects a 6%-
11% y-o-y drop in net profits this fiscal year despite higher sales.
Excluding the impact of any unforeseen one-off items, management’s guidance for FY14/15
reflects its concerns over current currency headwinds, which will directly affect group’s
profitability, as well as the political uncertainty in Greece that will affect consumer sentiment
accordingly. However, we believe that the company can successfully cope with these risks
based on an efficient margin management (changes in the pricing policy, early stocking,
favourable sales mix) and its strong market position.
We have adopted a more conservative stance about the evolution of group’s gross margin
in the medium term, following the recent depreciation of the euro against the US dollar.
Accordingly, we have cut our EBITDA estimates by a mid-single digit over the next 5 years,
leading to 8% reduction in our target price. In particular, our DCF valuation model has
yielded a fair value of EUR 13.20/share for Jumbo (vs. EUR 14.30/share previously), which
points to a 32% upside potential against current price levels. On our numbers, Jumbo trades
11.6x its FY15e calendarized net earnings or at a 32% discount against European retailers,
which in our view reflects the elevated political uncertainties in Greece. However, we
believe that the stock will be among the best performers in ATHEX when political stability is
restored, thus we maintain our ‘Buy’ rating.
Based on Jumbo’s current price levels, we understand that the market has placed a higher
risk premium on the stock to reflect the heightened political uncertainty in Greece. Given the
convenient risk profile of Jumbo (solid earnings potential, healthy balance sheet,
geographical diversification), a business-friendly political environment could drive our
valuation to the level of EUR 15.40/share (i.e. assuming a 100bps reduction in the discount
rate). Jumbo’s valuation is also quite sensitive to fluctuations in the gross margin. On our
numbers, a 50bps better gross margin against our estimates over FY15-FY19 will add EUR
2.00/share to our target price and 2.2% to our annual net earnings forecasts.
Solid performance in FY13/14 to continue in FY14/15
Valuation & Catalysts
A conservative guidance for FY14/15
Jumbo
Page 4
542 600 681 745 815
7.9%
10.8%
13.5%
9.4% 9.3%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
0
100
200
300
400
500
600
700
800
900
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Group sales (EUR m) % chg
0.18 0.23 0.26 0.29 0.31
1.8%
2.2%
2.6%2.8%
3.1%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0.35
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Shareholder remuneration (EUR) Dividend yield (%)
0.740.81
0.931.02
1.12
0.00
0.20
0.40
0.60
0.80
1.00
1.20
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Clean EPS (EUR)
147 159 180 197 215
27.0%
26.6% 26.5% 26.5% 26.4%
23.0%
23.5%
24.0%
24.5%
25.0%
25.5%
26.0%
26.5%
27.0%
27.5%
0
50
100
150
200
250
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
EBITDA (EUR m) margin (%)
Among the main investment positives we identify: a) the strong earnings potential (EPS to
grow by 11% over FY14-FY18e) driven by the improving macro conditions in the countries
in which Jumbo has presence, b) group’s solid balance sheet (net cash position of EUR
138m at the end of June 2014 or 10% of current MCAP), c) the fast-growing free cash flow
generation (>EUR 100m by FY16/17) that will allow the implementation of the business plan
(opening of 16-18 stores in Romania, expansion in new markets) and the distribution of a
generous dividend (15% DPS CAGR over FY14-FY18e) without the need for external
financing.
Revenue forecasts EBITDA forecasts
EPS forecasts Shareholder remuneration
Source: IBG Research, The company, Note that Jumbo’s fiscal year ends on June 30
Investment positives
Jumbo
Page 5
Forecasts Revision
We have modified our P&L forecasts to take into account management’s guidance for 6
store openings in the current fiscal year (July 14 – June 15), which stands above our
previous assumption for 4 new stores, as well as the weakness of the euro against the US
dollar. Starting from the revenue side, we look for sales of 11% y-o-y to EUR 600m, driven
by a positive same-stores sales growth in Greece (IBGe for +2% y-o-y) on the back of
macro recovery in Greece, as well as new store openings (3 in Romania, 2 in Greece, 1 in
Cyprus). It is indicative that in the first two months of FY14/15, Jumbo sales grew by more
than 10% y-o-y, above management’s target for sales growth between 4% and 6%. For
FY15/16, we have assumed the opening of 5 new stores (2 in Greece, 3 in Romania) which
coupled with an improved macro environment in the region (see table below) will lead to a
13.5% y-o-y sales growth to EUR 681m. On the whole, we have raised our revenue
estimates by 3% for FY14/15 and by 7% for FY15/16 to reflect the faster than initially
expected implementation of store roll-out plans and the positive signs seen in the previous
quarters (4Q13/14: +8.8% y-o-y, 3Q13/14: 8.9% y-o-y, 2Q13/14: +8.2% y-o-y, 1Q13/14:
5.8% y-o-y).
GDP growth rate 2013-2018
2013 2014e 2015f 2016f 2017f 2018f
Greece -3.9% 0.6% 2.9% 3.7% 3.5% 3.3%
Cyprus -6.0% -4.8% 0.9% 1.9% 2.3% 2.2%
Bulgaria 0.9% 1.6% 2.5% 3.0% 3.0% 3.0%
Romania 3.5% 2.2% 2.5% 2.9% 3.4% 3.5%
Source: IMF
On the profitability side, we have adopted a more conservative stance expecting a 110bps
y-o-y contraction in FY14/15e gross margin versus our previous call for flattish margin. Our
previous estimate was based on an average EUR/USD rate of 1.31 for FY14/15, which
seems rather optimistic given that the currency rate currently stands at 1.27. For FY15/16,
we have assumed a 100bps y-o-y margin drop, while for FY16/17 and FY17/FY18 we look
for a 50bps y-o-y contraction, driving Jumbo’s gross margin at the level of 50% in FY17/18,
still above management’s guidance for a sustainable margin between 48%-49% in the
medium term. As far as operating expenses are concerned, we have fine-tuned our
assumption regarding the opex/sales ratio expecting a gradual de-escalation on increased
operating leverage.
Based on these assumptions, we forecast EBITDA of EUR 159m (+9% y-o-y) for FY14/15
and EUR 180m (+13% y-o-y) for FY15/16, expecting the respective margin to remain below
the 27% mark over our forecast period. Compared to our previous estimates, we have cut
our EBITDA estimates by 4% for FY14/15 and by 3% for FY15/16, which is mainly the result
of our more conservative stance over the evolution of gross margin.
Following the changes in our EBITDA estimates, we have revised our net earnings
forecasts accordingly, as we have not proceeded to any material changes in our
assumptions relating to depreciation expenses, net finance income and income tax (i.e.
effective tax rate of 22%). For FY14/15, we forecast net profits of EUR 110m (+8% y-o-y,
2% below our previous forecast), which stands above management’s target for EUR 90-
95m. For FY15/16 and FY16/17, we have reduced our estimates by 2% and 5%
respectively, but we still expect solid earnings growth. In particular, we forecast net earnings
of EUR 126m (+15% y-o-y) for FY15/16 and EUR 139m (+10% y-o-y) for FY16/17. On the
whole, we expect Jumbo to deliver an 11% net earnings CAGR over FY14-FY18e.
Jumbo
Page 6
On the dividend front, we have assumed a dividend payout ratio of 28% (vs. 30%
previously), which leads to an expected DPS of EUR 0.23 for FY14/15 and EUR 0.26/share
for FY15/16. Recall that the company has proposed the distribution of an ordinary dividend
of EUR 0.18/share for FY13/14 (ex-dividend: October 22nd
), which points to a dividend
payout ratio of 24%, below the average in the period FY08/09 - FY11/12 (i.e. 29.3%).
Jumbo P&L forecasts
EUR m 2014a 2015f 2016f 2017f 2018f CAGR
FY14-FY18f
# of stores - Greece 52 54 56 58 58
# of stores - Cyprus 4 5 5 5 5
# of stores - Bulgaria 8 8 8 8 8
# of stores - Romania 2 5 8 11 15
# of stores year end 66 72 77 82 86
Greece – Sales 417.8 443.8 484.0 526.1 570.3
Cyprus - Sales 66.9 82.5 99.9 103.9 108.1
Bulgaria - Sales 40.5 42.5 44.6 46.4 48.3
Romania - Sales 8.8 22.9 43.6 59.2 77.9
Other - Sales* 7.9 8.5 9.1 9.7 10.3
Sales 541.8 600.2 681.2 745.4 814.9 11%
% change 7.9% 10.8% 13.5% 9.4% 9.3%
Gross profit 287.8 312.2 347.5 376.5 407.6
% margin 53.1% 52.0% 51.0% 50.5% 50.0%
SGA -159.0 -171.4 -187.0 -200.2 -214.7
SGA/sales 29.4% 28.6% 27.5% 26.9% 26.4%
Other income / expenses -1.6 -2.0 -2.0 -2.0 -2.0
EBIT 127.1 138.9 158.6 174.4 190.9
% margin 23.5% 23.1% 23.3% 23.4% 23.4%
Depreciation 19.4 20.6 21.8 23.0 24.2
Reported EBITDA 146.5 159.5 180.4 197.5 215.1
Clean EBITDA** 146.5 159.5 180.4 197.5 215.1 10%
% margin 27.0% 26.6% 26.5% 26.5% 26.4%
% change 9.4% 8.8% 13.1% 9.5% 8.9%
Net financials 2.9 2.7 4.2 4.7 5.2
EBT 130.0 141.5 162.7 179.2 196.1
Income taxes -28.7 -31.8 -36.6 -40.3 -44.1
Reported Net profits 101.2 109.7 126.1 138.8 152.0
Net profit adj** 101.2 109.7 126.1 138.8 152.0 11%
EPS 0.74 0.81 0.93 1.02 1.12
% change 6.5% 8.3% 15.0% 10.1% 9.4%
DPS 0.18 0.23 0.26 0.29 0.31 15%
Dividend payout 24.2% 28.0% 28.0% 28.0% 28.0%
Source: IBG Research, The Company, * Sales from franchised stores in FYROM and Albania, ** Excluding one-offs
Jumbo
Page 7
Key P&L assumptions
New assumptions 2015f 2016f 2017f 2018f
Greece (l-f-l sales growth) 2.0% 3.0% 3.0% 3.0%
Cyprus (l-f-l sales growth) -2.0% 4.0% 4.0% 4.0%
Bulgaria (l-f-l sales growth) 5.0% 5.0% 4.0% 4.0%
Sales growth 10.8% 13.5% 9.4% 9.3%
Δ (Gross margin) -110bps -100bps -50bps -50bps
SG&A/sales ratio 28.6% 27.5% 26.9% 26.4%
Old assumptions
Greece (l-f-l sales growth) 1.0% 3.0% 3.0% 3.0%
Cyprus (l-f-l sales growth) -2.0% 4.0% 4.0% 4.0%
Bulgaria (l-f-l sales growth) 5.0% 5.0% 4.0% 4.0%
Sales growth 7.2% 9.7% 9.1% 9.5%
Δ (Gross margin) 0bps -50bps -50bps -30bps
SG&A/sales ratio 28.8% 27.7% 26.9% 26.4%
Source: IBG Research
Forecast Changes for the period FY15-FY18
EUR m 2015f 2016f 2017f 2018f
Sales - New 600.2 681.2 745.4 814.9
Sales - Old 580.2 636.4 694.6 760.6
New vs. Old 3% 7% 7% 7%
EBITDA - New 159.5 180.4 197.5 215.1
EBITDA - Old 166.1 186.9 207.1 229.1
New vs. Old -4% -3% -5% -6%
Net income - New 109.7 126.1 138.8 151.9
Net income - Old 111.8 129.0 146.6 166.4
New vs. Old -2% -2% -5% -9%
Source: IBG Research, Note that Jumbo’s fiscal year ends on June 30
Jumbo
Page 8
66 72 77 82 86
13%
16%
9%8%
9%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
0
10
20
30
40
50
60
70
80
90
100
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Number of Stores Net Selling capacity (chg y-o-y)
79% 75% 72% 72% 71%
12% 14% 15% 14% 13%
7% 7% 7% 6% 6%
4% 6% 8% 10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Greece & Other Cyprus Bulgaria Romania
53.1% 52.0% 51.0% 50.5% 50.0%
80bps
-110bps-100bps
-50bps -50bps
-140bps
-90bps
-40bps
10bps
60bps
110bps
48.0%
48.5%
49.0%
49.5%
50.0%
50.5%
51.0%
51.5%
52.0%
52.5%
53.0%
53.5%
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Gross margin chng
86 72 84 103 1160
20
40
60
80
100
120
140
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Free cash flow (EUR m)
52 54 56 58 58
4 5 5 5 58 8 8 8 825
811 15
0
10
20
30
40
50
60
70
80
90
100
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Greece Cyprus Bulgaria Romania
78% 75% 70% 69% 68%
22% 25% 30% 31% 32%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Greece International
Net Selling capacity Number of stores per country
Revenue breakdown per geography Gross margin
EBITDA breakdown per geography Free cash flow FY14-FY18
Source: IBG Research, The company, Note that Jumbo’s fiscal year ends on June 30
Jumbo
Page 9
Valuation & Rating
DCF valuation
We have valued Jumbo by using a 2-stage DCF model, developing explicit forecasts for the
fiscal years 2015-2019. We have maintained the discount rate (WACC) unchanged at 8.6%
and the terminal growth rate at 2.0%. We have also retained our assumption for capex of
EUR 36m over the forecast period assuming 6 store openings in FY15, 5 store additions in
FY16-17 and 4 new stores in FY18-FY19. We remind that company is targeting the
operation of 6-8 new stores in the next 3 to 4 years in Greece and 16-18 stores in the next 5
years in Romania.
We have used group’s FY14 reported net cash position (i.e EUR 122m) and take into
account group’s investments in securities (i.e. EUR 15.1m), the value of its investment
properties (i.e EUR 6.5m) and the blocked bank deposits at Bank of Cyprus (i.e. EUR 8.1m)
as of June 30th 2014, based on Jumbo’s annual financial statements.
Following the downward revision to our earnings estimates due to the expected
depreciation of the euro against the US dollar and the changes in our valuation
assumptions, our DCF model returns a fair price of EUR 13.20/share (from EUR
14.30/share previously) for the stock. Our new target price stands 32% above yesterday’s
closing price, thus we maintain our ‘Buy’ recommendation on Jumbo.
DCF Valuation
EUR m 2015f 2016f 2017f 2018f 2019f
No of stores 72 77 82 86 90
Store openings 6 5 5 4 4
EBIT 139 159 174 191 199
Less: Notional tax on EBIT (22%) 31 35 38 42 44
Plus: Depreciation 21 22 23 24 25
Less: CAPEX 36 36 36 36 36
Less: Δ(WC) 22 27 23 25 22
Free Cash Flow to the Firm 71 82 100 113 123
WACC 8.6% 8.6% 8.6% 8.6% 8.6%
PV of FCFF 2015-2019 65 70 78 81 81
Sum of PV of FCFF 2015-2019 375
Terminal Growth Rate (Perpetuity) 2.0%
Terminal Value (Perpetuity) 1,265
Enterprise Value 1,640
Less: Net Debt / (Cash) FY14a -122
Plus: Securities 22
Plus: Blocked bank deposits 8
Equity value 1,793
No of share 136.1
Value per Share 13.20
Source: IBG Research
78% 75% 70% 69% 68%
22% 25% 30% 31% 32%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FY 2014 FY 2015f FY 2016f FY 2017f FY 2018f
Greece International
Jumbo
Page 10
Sensitivity on DCF valuation
We provide below a sensitivity analysis of our valuation results with respect to the discount
rate and the perpetuity growth rate. Our sensitivity analysis yields a EUR 10.50-EUR 18.10
price range for Jumbo. Based on Jumbo’s current price levels, we understand that the
market has placed a higher risk premium on the stock to reflect the heightened political
uncertainty in Greece. Given the convenient risk profile of Jumbo (solid earnings potential,
healthy balance sheet, geographical diversification), a business-friendly political
environment could drive our valuation to the level of EUR 15.40/share, assuming a 100bps
reduction in our discount rate.
Jumbo’s valuation is also quite sensitive to fluctuations in the gross margin. On our
numbers, a 50bps better gross margin against our estimates over FY15-FY19 will add EUR
2.00/share to our target price and 2.2% to our net earnings forecasts.
DCF valuation sensitivity – WACC and perpetuity rate (in EUR)
Weighted Average Cost of Capital
Terminal Growth rate
7.6% 8.6% 9.6%
1.0% 13.60 11.90 10.50
2.0% 15.40 13.20 11.50
3.0% 18.10 15.00 12.80
Source: IBG Research
Risks to our Estimates and Valuation
The main risk elements to our forecasts and valuation relate to:
On the upside:
(1) Faster than expected recovery of the Greek economy
(2) Faster than expected development of the distribution network
(3) Slow increase in transportation costs from current low levels
(4) Convenient FX movements (i.e. stable or stronger euro)
On the downside:
(1) Unfavourable currency movements (stronger USD against the euro) that will
negatively affect group’s gross margin.
(2) Increased transportation costs and inflationary pressures in China that will negatively
impact group’s gross margin
(3) Weak sales growth on slower than expected economic recovery and political instability
in Greece, deeper recession in Cyprus and political instability in Bulgaria and Romania
(4) Delays in the roll-out of the distribution network in Romania and/or unsuccessful
market positioning
Jumbo
Page 11
7.5x
7.0x
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
14.0x
FWD EV/EBITDA FWD EV/EBITDA Avg 2004-2014
0.0x
5.0x
10.0x
15.0x
20.0x
25.0x
Jumbo FWD P/E EURO STOXX Retail FWD P/E
Peer Group Analysis
On our estimates, Jumbo trades at a ‘calendarized’ p/e multiple of 11.6x for 2015 and 10.3x
for 2016, pointing to a 30%-32% discount against value retailers. In terms of calendarized
EV/EBITDA ratio, Jumbo also looks undervalued compared to selected peers (i.e. 26%
discount on 2015e multiple and 31% discount on 2016e multiple). Jumbo seems more
attractive at current market value in comparison to European retailers, trading on a 30%
discount in terms of 2015e calendarized p/e multiple and a 31% discount in terms of 2016e
calendarized p/e ratio.
Peer Group Valuation
Value Retailers Mkt Cap P/E 15f
P/E 16f
EV/EBITDA 15f
EV/EBITDA 16f
Wal-Mart Stores, Inc. 195,073 14.0x 13.1x 7.7x 7.3x
Target Corporation 31,444 16.5x 13.9x 7.7x 7.1x
Dollar General Corporation 14,677 15.2x 12.9x 8.7x 7.9x
Family Dollar Stores, Inc. 6,967 23.2x 20.6x 10.7x 9.9x
Dollarama Inc. 4,464 18.6x 15.9x 13.3x 11.7x
Big Lots, Inc. 1,910 14.5x 11.9x 6.5x 5.9x
Average 17.0x 14.7x 9.1x 8.3x
Jumbo (IBG ‘calendarized’)* 1,362 11.6x 10.3x 6.8x 5.8x
Premium/(Discount) to peers -32% -30% -26% -31%
Euro STOXX-Retailers 16.6x 15.0x
Premium/(Discount) to European Retailers -30% -31%
Source: Factset, IBG Research, * Relates to the time-adjustment on Jumbo ratios (calendar vs. fiscal year)
In our view, the current pricing gap against European retailers as well as value retailers,
reflects to a great extent the elevated political uncertainties in the home country and their
direct link to consumer sentiment. This is evident when comparing Jumbo with the
benchmark index of European retailers in terms of forward p/e (see chart below). Pre-crisis,
the stock traded at par with European retailers, a trend which was reversed during the
period 2009-2012 when the ‘Grexit scenarios’ came on the spotlight. The pricing gap has
been gradually narrowing after the restoration of political stability in June 2012 (election of a
pro-European government) and the achievement of fiscal targets that set aside the fears of
Greece’s exiting the Eurozone. However, in the last three months, Jumbo’s discount against
European retailers started widening again as political risks in Greece re-emerged.
Jumbo vs. European Retailers Jumbo FWD EV/EBITDA
Source: Factset database
Jumbo
Page 12
FY 13/14 Results Review
Jumbo delivered good results for 4Q13/14, but EBITDA and net profits came below our
estimates due to the lower than we had expected gross margin. In particular, Jumbo
reported quarterly revenues of EUR 131m (+8.8% y-o-y), EBITDA of EUR 44.2m (+2.6% y-
o-y on a comparable basis, 7% below our estimates) and net profits of EUR 31.8m (+8% y-
o-y on a comparable basis, 5.6% below our estimates).
The negative surprise against our EBITDA call should be attributed to the lower than we
had expected gross margin in 4Q13/14 (i.e. 60bps contraction vs. our forecast for 140bps
improvement) despite a favourable EUR/USD rate. Operating expenses grew by 11% y-o-y
in 4Q (opex/sales ratio up 60bps y-o-y, in line with 3Q trend) due to new store openings, but
this was in line with our estimates.
On a full year basis, Jumbo reported revenues of EUR 541.9m (+7.9% y-o-y), EBITDA of
EUR 146.5m (+9.4% y-o-y on a comparable basis) and net profits of EUR 101.3m (+6.5% y-
o-y on a comparable basis). We remind that Jumbo’s FY12/13 earnings were negatively
affected by an one-off EUR 23.6m impairment loss resulting from group’s bank deposits at
Bank of Cyprus.
Operating cash flow settled at c. EUR 122m in FY13/14 compared to EUR 60m in FY12/13,
while the company has invested EUR 35.9m in FY13/14 vs. EUR 38.3m in FY12/13,
pointing to free cash flow of EUR 86m (vs. EUR 21.5m the respective period last year).
The company has proposed the distribution of an ordinary (gross) dividend of EUR
0.18/share, which stands below our estimate for EUR 0.23/share. The implied dividend
payout is 24%, which is less than the 29% average dividend payout during FY09-FY12 (last
year the company did not pay an ordinary dividend due to the one-off loss in Cyprus). The
stock will trade ex-dividend on October 22. Recall that the ordinary dividend is subject to a
10% withholding tax.
Jumbo 4Q & FY 2013/14 P&L Statement
EUR m FY13/14 FY12/13 y-o-y 4Q13/14 4Q12/13 y-o-y
Revenues 541.8 502.2 7.9% 130.9 120.3 8.8%
COGS -254.0 -239.4 6.1% -57.4 -52.1 10.2%
Gross Profit 287.8 262.8 9.5% 73.5 68.3 7.7%
Gross Margin 53.1% 52.3% 80 bps 56.2% 56.7% -60 bps
Other Income 3.4 4.6 -26.8% 0.8 2.4 -68.3%
Administrative Expenses -21.3 -19.4 9.4% -4.2 -3.7 14.9%
Distribution Costs -137.8 -127.3 8.2% -30.6 -27.8 9.9%
Other Expenses -5.0 -29.0 -82.7% -0.1 -5.1 -
EBIT 127.1 91.6 38.8% 39.4 34.1 15.8%
EBIT Margin 23.5% 18.2% 520 bps 30.1% 28.3% 180 bps
Depreciation 19.4 18.8 3.2% 4.8 4.8 1.4%
Reported EBITDA 146.5 110.388 32.7% 44.2 38.8 -
Clean EBITDA* 146.5 134.0 9.4% 44.2 43.1 2.6%
% sales 27.0% 26.7% 40 bps 33.8% 35.8% -200 bps
Net Financial Results 2.9 4.1 -30.4% 0.9 2.1 -
EBT 130.0 95.7 35.8% 40.3 36.2 -
Income Tax -28.7 -21.7 32.1% -8.5 -10.4 -
Reported net profit 101.2 74.0 36.9% 31.8 25.8 -
Clean net* 101.2 95.1 6.5% 31.8 29.5 7.7%
Source: IBG Research, The Company , * 4Q & FY 2013 EBITDA and net profits adjusted for the one-off (pre-tax) provision of EUR 4.5m and EUR 23.6m respectively relating to the impairment of bank deposits at Bank of Cyprus, ** 4Q13
Jumbo
Page 13
Per geography, Greek operations (incl. franchised stores in Albania & FYROM) recorded
sales of EUR 103m (+2.8% y-o-y) in 4Q, revenues from Cyprus rose by 32% y-o-y to EUR
16m benefiting from the opening of the new store in Pafos, while sales from Bulgaria grew
by 15% y-o-y to EUR 9.0m in 4Q13/14. The new operation in Romania (2 stores) recorded
revenues of EUR 2.7m in 4Q13/14. Excluding the EUR 1.95m revenues generated from the
franchised stores in FYROM and Albania, Greek sales were up by 2.6% y-o-y, pointing to a
like-for-like sales growth of -3% y-o-y.
On a full year basis, Greek sales grew by 2.9% y-o-y accounting for 78.6% of group sales
compared to 82.4% in FY12/FY13. Revenues from the Cypriot stores increased by 12% y-o-
y, but excluding the contribution of the new store in Paphos, sales were up by c. 2% y-o-y
on a like-for-like basis. Bulgaria maintained its strong momentum delivering sales of EUR
40.5m (+18.5% y-o-y) and EBITDA of EUR 12.2m (+31%, margin up by 290bps y-o-y) in
FY13/14. The beginning of the new operation in Romania has been quite encouraging, as
the two first stores reported revenues of EUR 8.8m (nearly EUR 600 per effective sq.m.).
Key P&L items per country
(EUR m) FY13/14 FY12/13 y-o-y 4Q13/14 4Q12/13 y-o-y
Greece & Other* - Sales 425.6 413.7 2.9% 102.9 100.1 2.8%
% of total 78.6% 82.4%
78.6% 83.2%
Cyprus - Sales 66.9 54.3 23.3% 16.3 12.3 32.4%
% of total 12.3% 10.8%
12.5% 10.2%
Bulgaria - Sales 40.5 34.2 18.5% 9.0 7.9 14.7%
% of total 7.5% 6.8%
6.9% 6.5%
Romania - Sales 8.8 0.0 2.7 0.0
% of total 1.6% 0.0% 2.0% 0.0%
Group Sales 541.8 502.2 7.9% 130.9 120.3 8.8%
Greece & Other* - Gross profits 229.7 218.9 5.0% 59.4 58.2 2.1%
% margin 54.0% 52.9% 110 bps 57.8% 58.1% -40 bps
Cyprus - Gross profits 33.8 27.2 24.0% 8.3 6.2 33.3%
% margin 50.5% 50.2% 30 bps 50.8% 50.4% 40 bps
Bulgaria - Gross profits 19.7 16.6 18.4% 4.4 3.9 14.8%
% margin 48.7% 48.7% bps 49.1% 49.0% bps
Romania - Gross profits 4.6 0.0 1.4 0.0
% margin 52.1% 51.7%
Group Gross Profits 287.8 262.8 9.5% 73.5 68.3 7.7%
Greece & Other* - EBITDA 127.2 124.7 2.0% 36.2 38.8 -6.7%
% margin 29.9% 30.1% -20 bps 35.2% 38.8% -360 bps
Cyprus - EBITDA 26.2 21.3 22.8% 6.4 5.0 28.4%
% margin 39.1% 39.3% -10 bps 39.3% 40.6% -120 bps
Bulgaria - EBITDA 12.2 9.3 31.2% 2.6 2.0 27.0%
% margin 30.1% 27.2% 290 bps 28.7% 25.9% 280 bps
Romania - EBITDA 2.3 0.0 0.7 0.0
% margin 26.0% 26.7%
Other -21.3 -44.8 -1.7 -7.0
Group EBITDA 146.5 110.5 32.6% 44.2 38.9 13.8%
Source: IBG Research, The Company, * Includes sales from franchised operations in FYROM and Albania
Jumbo
Page 14
The deterioration of group’s gross margin by 60bps y-o-y in 4Q13/14 should be attributed to
the increased contribution of toy products in the sales mix, as well as the reduced revenues
from Jumbo’s high-margin seasonal and home products. On a full year basis, toys remained
Jumbo’s main product category representing 29% of total sales, followed by home products
that generated 28.6% of total sales in FY13/14 compared to 27.6% in FY12/13 and
seasonal products (24.3% of annual sales, flat y-o-y).
Sales analysis per product category
(EUR m) FY13/14 FY12/13 y-o-y 4Q13/14 4Q12/13 y-o-y
Toys 157.2 149.8 4.9% 36.0 29.2 23.3%
% of total 29.0% 29.8%
27.5% 24.3%
Baby apparel 52.9 52.0 1.7% 13.2 2.1 545.5%
% of total 9.8% 10.4%
10.1% 1.7%
Stationary 45.1 40.6 11.1% 6.4 -1.3
% of total 8.3% 8.1%
4.9% -1.1%
Seasonal / Other 131.7 121.4 8.5% 34.9 43.1 -19.0%
% of total 24.3% 24.2% 26.7% 35.8%
Home products 155.0 138.5 11.9% 40.3 47.3 -14.7%
% of total 28.6% 27.6%
30.8% 39.3%
Total Sales 541.8 502.2 7.9% 130.9 120.3 8.8%
Source: IBG Research, The Company
Jumbo
Page 15
Presentation to Greek institutional investors
The key highlights from the company's presentation to Greek institutional investors are summarized below:
FY14/15 guidance: a) sales growth 4%-6%, b) net earnings of EUR 90-95m, c) EUR
35-40m capex, d) 6 new store openings (2 in Greece, 1 in Cyprus, 3 in Romania). The
increase in sales will offset the pressure on gross margin due to the weakening of the
euro against the US dollar. Gross margin is expected to drop by 150bps y-o-y in
FY14/15. In general, the management appeared cautious for the overall business
environment in Greece.
In the first quarter of FY14/15, sales grew by a low double digit growth (+10%-11%)
due to: a) 3%-4% l-f-l increase in Greek sales, b) 1%-1.5% attributed to the new store in
Northern Greece, c) 1.1%-1.5% growth in Cyprus, d) double digit growth in Bulgaria and
e) the contribution of the two stores in Romania. The pressure on the gross margin was
less than 100bps y-o-y in 1Q14/15.
Balkans: The resilient gross margin in the Balkans (Bulgaria, Romania), despite the low
product prices, was attributed to the favorable sales mix (small contribution of branded-
products). The management expects that the sales growth from its stores in Bulgaria
and Romania will be two-times higher than in Greece.
Strategy: The company is considering the entry in new markets such as Turkey or
Middle East, but any development should be expected by 2017. For the time being, the
company will focus on the expansion of its presence in existing markets, while Serbia
could be a target if the country becomes ‘more European’. The management is planning
to expand its distribution network to Greece and Cyprus to 64 stores from 56 stores at
the end of FY13/14 and 59 stores at the end of FY14/15.
Dividend: The management said that the company distributes 35% of the net earnings
of its parent company as an ordinary dividend each year. The management will consider
a more generous policy when visibility in the Greek market improves.
FX rates: In relation to the potential impact from FX fluctuations on group’s
performance, the management said that it has proceeded to early stocking (6 months
ahead) and used hedging instruments to reduce the risks stemming from adverse FX
movements.
Jumbo
Page 16
Jumbo: Summary tables
PROFIT & LOSS (EURm) 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Sales 494 502 542 600 681 745
Cost of Sales & Operating Costs -360 -392 -395 -441 -501 -548
Non Recurrent Expenses/Income 0.0 -23.6 0.0 0.0 0.0 0.0
EBITDA 134 110 147 159 180 197
EBITDA (adj.)* 134 134 147 159 180 197
Depreciation -17.4 -18.8 -19.4 -20.6 -21.8 -23.0
EBITA 117 91.6 127 139 159 174
EBITA (adj)* 117 115 127 139 159 174
Amortisations and Write Downs 0.0 0.0 0.0 0.0 0.0 0.0
EBIT 117 91.6 127 139 159 174
EBIT (adj.)* 117 115 127 139 159 174
Net Financial Interest 2.4 3.6 2.7 2.5 4.0 4.6
Other Financials 0.0 0.0 0.0 0.0 0.0 0.0
Associates 0.0 0.5 0.2 0.2 0.2 0.2
Other Non Recurrent Items 0.0 0.0 0.0 0.0 0.0 0.0
Earnings Before Tax (EBT) 119 95.7 130 142 163 179
Tax -22.2 -21.7 -28.7 -31.8 -36.6 -40.3
Tax rate 18.6% 22.7% 22.1% 22.5% 22.5% 22.5%
Discontinued Operations 0.0 0.0 0.0 0.0 0.0 0.0
Minorities 0.0 0.0 0.0 0.0 0.0 0.0
Net Profit (reported) 97.3 74.0 101 110 126 139
Net Profit (adj.) 97.3 95.1 101 110 126 139
CASH FLOW (EURm) 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Cash Flow from Operations before change in NWC 98.1 66.0 135 130 148 162
Change in Net Working Capital -2.2 -6.2 -12.6 -22.3 -27.4 -22.8
Cash Flow from Operations 95.9 59.8 122 108 120 139
Capex -49.9 -38.3 -35.9 -36.0 -36.0 -36.0
Net Financial Investments 10.1 -5.5 14.4 0.0 0.0 0.0
Free Cash Flow 56.0 16.0 101 72.0 84.5 103
Dividends 0.0 0.0 -24.5 -30.7 -35.3 -38.9
Other (incl. Capital Increase & share buy backs) -27.7 -26.1 25.6 6.2 4.6 3.6
Change in Net Debt 28.3 -10.0 102 47.5 53.8 67.8
NOPLAT 93.6 92.1 94.1 103 117 129
BALANCE SHEET & OTHER ITEMS (EURm) 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Net Tangible Assets 415 431 446 461 475 488
Net Intangible Assets (incl.Goodwill) 0.0 0.0 0.0 0.0 0.0 0.0
Net Financial Assets & Other 29.1 56.5 43.7 43.7 43.7 43.7
Total Fixed Assets 444 487 490 505 519 532
Inventories 180 176 186 213 247 274
Trade receivables 42.6 44.2 56.5 64.1 74.7 83.7
Other current assets 4.6 16.4 14.1 14.1 14.1 14.1
Cash (-) -185 -170 -288 -334 -387 -455
Total Current Assets 412 407 544 625 724 827
Total Assets 857 894 1,034 1,130 1,243 1,360
Shareholders Equity 593 639 745 830 925 1,029
Minority 0.0 0.0 0.0 0.0 0.0 0.0
Total Equity 593 639 745 830 925 1,029
Long term interest bearing debt 152 1.4 144 144 144 144
Provisions 4.1 4.1 5.0 5.0 5.0 5.0
Other long term liabilities 6.4 7.6 7.7 7.7 7.7 7.7
Total Long Term Liabilities 163 13.1 156 156 156 156
Short term interest bearing debt 1.9 148 21.4 20.0 20.0 20.0
Trade payables 56.0 52.4 52.2 57.6 65.8 71.7
Other current liabilities 43.3 41.5 59.4 65.8 75.3 82.8
Total Current Liabilities 101 242 133 143 161 175
Total Liabilities and Shareholders' Equity 857 894 1,034 1,130 1,243 1,360
Net Capital Employed 573 630 635 672 714 750
Net Working Capital 172 184 205 233 270 300
GROWTH & MARGINS 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Sales growth 0.9% 1.6% 7.9% 10.8% 13.5% 9.4%
EBITDA (adj.)* growth -0.5% -0.3% 9.4% 8.8% 13.1% 9.5%
EBITA (adj.)* growth -2.4% -1.6% 10.4% 9.2% 14.2% 10.0%
EBIT (adj)*growth -2.4% -1.6% 10.4% 9.2% 14.2% 10.0%
Jumbo
Page 17
Jumbo: Summary tables
GROWTH & MARGINS 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Net Profit growth 2.9% -2.3% 6.5% 8.3% 15.0% 10.1%
EPS adj. growth 2.9% -2.3% 1.7% 8.3% 15.0% 10.1%
DPS adj. growth 0.0% n.m. n.m. 25.4% 15.0% 10.1%
EBITDA (adj)* margin 27.2% 26.7% 27.0% 26.6% 26.5% 26.5%
EBITA (adj)* margin 23.7% 22.9% 23.5% 23.1% 23.3% 23.4%
EBIT (adj)* margin 23.7% 22.9% 23.5% 23.1% 23.3% 23.4%
RATIOS 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Net Debt/Equity -0.1 0.0 -0.2 -0.2 -0.2 -0.3
Net Debt/EBITDA -0.2 -0.2 -0.8 -1.1 -1.2 -1.5
Interest cover (EBITDA/Fin.interest) n.m. n.m. n.m. n.m. n.m. n.m.
Capex/D&A 286.9% 203.9% 184.9% 174.9% 165.1% 156.4%
Capex/Sales 10.1% 7.6% 6.6% 6.0% 5.3% 4.8%
NWC/Sales 34.7% 36.7% 37.8% 38.9% 39.7% 40.3%
ROE (average) 17.4% 15.4% 14.6% 13.9% 14.4% 14.2%
ROCE (adj.) 16.0% 15.0% 14.5% 14.8% 15.7% 16.4%
WACC 13.4% 10.0% 9.9% 8.6% 8.6% 8.6%
ROCE (adj.)/WACC 1.2 1.5 1.5 1.7 1.8 1.9
PER SHARE DATA (EUR)*** 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Average diluted number of shares 130.0 130.0 136.1 136.1 136.1 136.1
EPS (reported) 0.75 0.57 0.74 0.81 0.93 1.02
EPS (adj.) 0.75 0.73 0.74 0.81 0.93 1.02
BVPS 4.56 4.92 5.47 6.10 6.80 7.56
DPS 0.21 0.00 0.18 0.23 0.26 0.29
VALUATION 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
EV/Sales 0.7 1.8 2.8 2.0 1.7 1.4
EV/EBITDA 2.5 8.4 10.3 7.5 6.3 5.4
EV/EBITDA (adj.)* 2.5 6.9 10.3 7.5 6.3 5.4
EV/EBITA 2.8 10.1 11.8 8.6 7.2 6.1
EV/EBITA (adj.)* 2.8 8.0 11.8 8.6 7.2 6.1
EV/EBIT 2.8 10.1 11.8 8.6 7.2 6.1
EV/EBIT (adj.)* 2.8 8.0 11.8 8.6 7.2 6.1
P/E (adj.) 3.7 9.9 16.1 12.4 10.8 9.8
P/BV 0.6 1.5 2.2 1.6 1.5 1.3
Total Yield Ratio 0.0% 2.6% 2.3% 2.6% 2.9% 3.1%
EV/CE 0.6 1.5 2.3 1.7 1.5 1.4
OpFCF yield 12.7% 2.3% 5.3% 5.3% 6.2% 7.6%
OpFCF/EV 13.9% 2.3% 5.7% 6.0% 7.4% 9.6%
Payout ratio 28.0% 0.0% 24.2% 28.0% 28.0% 28.0%
Dividend yield (gross) 7.6% 0.0% 1.8% 2.3% 2.6% 2.9%
EV AND MKT CAP (EURm) 06/2012 06/2013 06/2014 06/2015e 06/2016e 06/2017e
Price** (EUR) 2.78 7.27 11.96 10.00 10.00 10.00
Outstanding number of shares for main stock 130.0 130.0 136.1 136.1 136.1 136.1
Total Market Cap 361 945 1,627 1,361 1,361 1,361
Net Debt -31 -21 -122 -170 -224 -292
o/w Cash & Marketable Securities (-) -185 -170 -288 -334 -387 -455
o/w Gross Debt (+) 154 149 165 164 164 164
Other EV components 0 0 0 0 0 0
Enterprise Value (EV adj.) 330 924 1,505 1,191 1,137 1,069
Source: Company, Investment Bank of Greece estimates.
Notes* Where EBITDA (adj.) or EBITA (adj)= EBITDA (or EBITA) -/+ Non Recurrent Expenses/Income and where EBIT (adj)= EBIT-/+ Non Recurrent Expenses/Income - PPA amortisation
**Price (in local currency): Fiscal year end price for Historical Years and Current Price for current and forecasted years
Sector: General Retailers/Broadline Retailers
Company Description: Jumbo is the largest toys/babies apparel/bookstore/seasonal products retailer in the Greek market. The company
has a resilient business model based on its geographical sales network expansion strategy, a wide assortment of products and a
competitive pricing policy. Today, the Jumbo network counts 66 stores (52 in Greece, 4 in Cyprus, 8 in Bulgaria and 2 in Romania),
while it is planning to open 6 new stores during July 14-June 15.
Jumbo
Page 18
European Coverage of the Members of ESN
A ero space & D efense M em(*) Banco Popolare BAK Talvivaara M ining Co Plc POH Schneider Electric Sa CIC Ldc CIC
Airbus Group CIC Banco Popular BKF Tubacex BKF Vacon POH Lotus Bakeries BDG
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Dassault Aviation CIC Bankinter BKF Bioalliance Pharma CIC Azimut BAK Parmalat BAK
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Lisi CIC Bcp CBI Epigenomics Ag EQB Banca Ifis BAK Raisio POH
M tu EQB Bes CBI M etabolic Explorer CIC Bb Biotech EQB Remy Cointreau CIC
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Rolls Royce CIC Bper BAK Oncodesign CIC Bois Sauvage BDG Ter Beke BDG
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Thales CIC Commerzbank EQB Wilex EQB Capman POH Vidrala BKF
Zodiac Aerospace CIC Credem BAK Zeltia BKF Cir BAK Vilmorin CIC
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Finnair POH Deutsche Bank EQB Akzo Nobel SNS Deutsche Boerse EQB Wessanen SNS
Lufthansa EQB Eurobank IBG Basf EQB Deutsche Forfait EQB F o o d & D rug R etailers M em(*)
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Continental EQB Intesa Sanpaolo BAK Henkel EQB Gimv BDG Casino Guichard-Perrachon CIC
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Elektrobit Group POH M ediobanca BAK K+S Ag EQB Hellenic Exchanges IBG Delhaize BDG
Elringklinger EQB National Bank Of Greece IBG Kemira POH Kbc Ancora BDG Dia BKF
Faurecia CIC Natixis CIC Lanxess EQB Luxempart BDG Jeronimo M artins CBI
Fiat BAK Nordea POH Linde EQB M lp EQB Kesko POH
Landi Renzo BAK Piraeus Bank IBG Nanogate Ag EQB Patrizia Ag EQB M arr BAK
Leoni EQB Postbank EQB Recticel BDG F o o d & B everage M em(*) M etro CIC
M ichelin CIC Societe Generale CIC Solvay BDG Acomo SNS Rallye CIC
Nokian Tyres POH Ubi Banca BAK Symrise Ag EQB Agrarius Ag EQB Sligro SNS
Piaggio BAK Unicredit BAK Tessenderlo BDG Anheuser-Busch Inbev BDG Sonae CBI
Pirelli & C. BAK Yapi Kredi Bank IBG Tikkurila POH Atria POH
Plastic Omnium CIC B asic R eso urces M em(*) Umicore BDG Baywa EQB
Porsche EQB Acerinox BKF Wacker Chemie EQB Berentzen EQB
Psa Peugeot Citroen CIC Altri CBIElectro nic & Electrical
EquipmentM em(*) Bonduelle CIC
Renault CIC Arcelormittal BKF Alstom CIC Campari BAK
Sogefi BAK Crown Van Gelder SNS Areva CIC Coca Cola Hbc Ag IBG
Stern Groep SNS Ence BKF Barco BDG Corbion SNS
Valeo CIC Europac BKF Euromicron Ag EQB Danone CIC
Volkswagen EQB M etka IBG Evs BDG Ebro Foods BKF
B anks M em(*) M etsä Board POH Gemalto CIC Enervit BAK
Aareal Bank EQB M ytilineos IBG Ingenico CIC Fleury M ichon CIC
Akbank IBG Nyrstar BDG Jenoptik EQB Forfarmers SNS
Aktia POH Outokumpu POH Kontron EQB Greenyard Foods BDG
Alpha Bank IBG Portucel CBI Legrand CIC Heineken SNS
Banca Carige BAK Rautaruukki POH Neways Electronics SNS Hkscan POH
Banca Etruria BAK Semapa CBI Nexans CIC Ktg Agrar EQB
Banca M ps BAK Stora Enso POH Pkc Group POH Lanson-Bcc CIC
Banco Bradesco CBI Surteco EQB Rexel CIC Laurent Perrier CIC
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General Industria ls M em(*) Grifo ls Sa BKF Duro Felguera BKF Hannover Re EQB Srv POH
2G Energy EQB Korian-M edica CIC Emak BAK M apfre Sa BKF Thermador Groupe CIC
Aalberts SNS Laboratorios Rovi BKF Exel Composites POH M edio lanum BAK Titan Cement IBG
Accell Group SNS M erck EQB Faiveley CIC M unich Re EQB Trevi BAK
Ahlstrom POH Novartis CIC Gea Group EQB Sampo POH Uponor POH
Analytik Jena EQB Orio la-Kd POH Gesco EQB Talanx Group EQB Uzin Utz EQB
Arcadis SNS Orion POH Haulotte Group CIC Unipol BAK Vbh Holding EQB
Aspo POH Orpea CIC Heidelberger Druck EQB Unipolsai BAK Vicat CIC
Bekaert BDG Recordati BAK Ima BAK Zurich Financial Services BAK Vinci CIC
Evolis CIC Rhoen-Klinikum EQB Interpump BAKM aterials, C o nstruct io n
& InfrastructureM em(*) Yit POH
Frigoglass IBG Roche CIC Kone POH Abertis BKF M edia M em(*)
Huhtamäki POH Sanofi CIC Konecranes POH Acs BKF Ad Pepper EQB
Kendrion SNS Sorin BAK Krones Ag EQB Adp CIC Alma M edia POH
M artifer CBI Stallergènes CIC Kuka EQB Astaldi BAK Brill SNS
M ifa EQB Ucb BDG M an EQB Atlantia BAK Cofina CBI
Nedap SNSH o tels, T ravel &
T o urismM em(*) M anitou CIC Ballast Nedam SNS Editoriale L'Espresso BAK
Neopost CIC Accor CIC M ax Automation Ag EQB Bilfinger Se EQB Gl Events CIC
Pöyry POH Autogrill BAK M etso POH Boskalis Westminster SNS Havas CIC
Prelios BAK Beneteau CIC Outotec POH Buzzi Unicem BAK Impresa CBI
Saf-Holland EQB Compagnie Des Alpes CIC Pfeiffer Vacuum EQB Caverion POH Ipsos CIC
Saft CIC Gtech BAK Ponsse POH Cfe BDG Jcdecaux CIC
Siegfried Holding Ag EQB I Grandi Viaggi BAK Prima Industrie BAK Ciments Français CIC Kinepolis BDG
Tkh Group SNS Ibersol CBI Prysmian BAK Cramo POH Lagardere CIC
Wendel CIC Intralo t IBG Reesink SNS Deceuninck BDG M 6-M etropole Television CIC
General R etailers M em(*) M elia Hotels International BKF Sabaf BAK Eiffage CIC M ediaset BAK
Beter Bed Holding SNS Nh Hotel Group BKF Singulus Technologies EQB Ellaktor IBG
D'Ieteren BDG Opap IBG Smt Scharf Ag EQB Ezentis BKF
Fielmann EQB Snowworld SNS Ten Cate SNS Fcc BKF
Folli Fo llie Group IBG Sonae Capital CBI Valmet POH Ferrovial BKF
Fourlis Holdings IBG Trigano CIC Vossloh EQB Fraport EQB
Inditex BKF Tui EQB Wärtsilä POH Grontmij SNS
Jumbo IBG Wdf BAK Zardoya Otis BKF Grupo San Jose BKF
M acintosh SNS H o useho ld Go o ds M em(*) Industria l T ranspo rtat io n M em(*) Heijmans SNS
Rapala POH Bic CIC Bollore CIC Hochtief EQB
Stockmann POH De Longhi BAK Bpost BDG Holcim Ltd CIC
H ealthcare M em(*) Indesit BAK Caf BKF Imerys CIC
Ab-Biotics BKF Seb Sa CIC Ctt CBI Italcementi BAK
Almirall BKF Industria l Engineering M em(*) Deutsche Post EQB Joyou Ag EQB
Amplifon BAK Accsys Technologies SNS Hes Beheer SNS Lafarge CIC
Bayer EQB Aixtron EQB Hhla EQB Lemminkäinen POH
Biomerieux CIC Ansaldo Sts BAK Logwin EQB M aire Tecnimont BAK
Biotest EQB Bauer Ag EQB Postnl SNS M ota Engil CBI
Celesio EQB Biesse BAK Tnt Express SNS Obrascon Huarte Lain BKF
Diasorin BAK Cargotec Corp POH Insurance M em(*) Ramirent POH
Draegerwerk EQB Cnh Industrial BAK Aegon SNS Royal Bam Group SNS
Espirito Santo Saude CBI Danieli BAK Ageas BDG Sacyr BKF
Faes Farma BKF Datalogic BAK Allianz EQB Saint Gobain CIC
Fresenius EQB Delclima BAK Axa CIC Salini Impregilo BAK
Fresenius M edical Care EQB Deutz Ag EQB Delta Lloyd SNS Sias BAK
Gerresheimer Ag EQB Dmg M ori Seiki Ag EQB Generali BAK Sonae Industria CBI
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Oil & Gas P ro ducers M em(*) Atenor BDG Guillemot Corporation CIC Iliad CIC
Eni BAK Banimmo BDG I:Fao Ag EQB Jazztel BKF
Galp Energia CBI Befimmo BDG Ict Automatisering SNS Kpn Telecom SNS
Gas Plus BAK Beni Stabili BAK Indra Sistemas BKF M obistar BDG
Hellenic Petro leum IBG Citycon POH Novabase CBI Nos CBI
M aurel Et Prom CIC Cofinimmo BDG Ordina SNS Numericable CIC
M otor Oil IBG Corio BDG Psi EQB Orange CIC
Neste Oil POH Deutsche Euroshop EQB Reply BAK Ote IBG
Petrobras CBI Grand City Properties EQB Rib Software EQB Ses CIC
Qgep CBI Home Invest Belgium BDG Seven Principles Ag EQB Telecom Italia BAK
Repsol BKF Igd BAK Tie Kinetix SNS Telefonica BKF
Total CIC Intervest Offices & Warehouses BDG Tieto POH Telenet Group BDG
Oil Services M em(*) Leasinvest Real Estate BDG Tomtom SNS Teliasonera POH
Bourbon CIC M ontea BDG Visiativ CIC Tiscali BAK
Cgg CIC Realia BKF Wincor Nixdorf EQB Turkcell IBG
Fugro SNS Retail Estates BDG Suppo rt Services M em(*) United Internet EQB
Saipem BAK Sponda POH Batenburg SNS Vodafone BAK
Technip CIC Technopolis POH Brunel SNS Utilit ies M em(*)
Tecnicas Reunidas BKF Unibail-Rodamco BDG Bureau Veritas S.A. CIC A2A BAK
Tenaris BAK Vastned Retail BDG Dpa SNS Acciona BKF
Vallourec CIC Vastned Retail Belgium BDG Edenred CIC Acea BAK
Vopak SNS Vib Vermoegen EQB Ei Towers BAK Albioma CIC
P erso nal Go o ds M em(*) Wdp BDG Fiera M ilano BAK Direct Energie CIC
Adidas EQB Wereldhave Belgium BDG Imtech SNS E.On EQB
Adler M odemaerkte EQB R enewable Energy M em(*) Lassila & Tikanoja POH Edp CBI
Amer Sports POH Daldrup & Soehne EQB Randstad SNS Edp Renováveis CBI
Basic Net BAK Deutsche Biogas EQB Usg People SNS Elia BDG
Beiersdorf EQB Enel Green Power BAKT echno lo gy H ardware &
EquipmentM em(*) Enagas BKF
Christian Dior CIC Gamesa BKF Alcatel-Lucent CIC Endesa BKF
Geox BAKSo ftware & C o mputer
ServicesM em(*) Asm International SNS Enel BAK
Gerry Weber EQB Affecto POH Asml SNS Falck Renewables BAK
Hermes Intl. CIC Akka Technologies CIC Besi SNS Fluxys Belgium BDG
Hugo Boss EQB Alten CIC Ericsson POH Fortum POH
Interparfums CIC Altran CIC Gigaset EQB Gas Natural Fenosa BKF
Kering CIC Amadeus BKF Nokia POH Hera BAK
Luxottica BAK Atos CIC Okmetic POH Iberdro la BKF
Lvmh CIC Basware POH Roodmicrotec SNS Iren BAK
M arimekko POH Bull CIC Slm Solutions EQB Public Power Corp IBG
M oncler BAK Cenit EQB Stmicroelectronics BAK Red Electrica De Espana BKF
Puma EQB Comptel POH Suess M icrotec EQB Ren CBI
Richemont CIC Digia POH Teleste POH Rwe EQB
Safilo BAK Docdata SNS T eleco mmunicat io ns M em(*) Snam BAK
Salvatore Ferragamo BAK Ekinops CIC Acotel BAK Terna BAK
Sarantis IBG Engineering BAK Belgacom BDG
Swatch Group CIC Esi Group CIC Bouygues CIC
Tod'S BAK Exact Holding Nv SNS Deutsche Telekom EQB
Zucchi BAK Exprivia BAK Drillisch EQB
R eal Estate M em(*) F-Secure POH Elisa POH
Aedifica BDG Gameloft CIC Eutelsat Communications Sa CIC
Ascencio BDG Gft Technologies EQB Freenet EQB
LEGEND: BAK: Banca Akros; BDG: Bank Degroof; BKF: Beka Finance; CIC: CM CIC Securities; CBI: Caixa-Banca de Investimento; EQB: Equinet bank; IBG: Investment Bank of Greece, POH:
Pohjola Bank; SNS: SNS Securities as of 1st September 2014
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List of ESN Analysts (**)
Ari Agopyan CIC +33 1 45 96 85 80 [email protected] Konstantinos Manolopoulos IBG +30 210 817 3388 [email protected]
Artur Amaro CBI +351 213 89 6822 [email protected] Dario Michi BAK +39 02 4344 4237 [email protected]
Christian Auzanneau CIC +33 4 78 92 01 85 [email protected] Marietta Miemietz CFA EQB +49-69-58997-439 [email protected]
Helena Barbosa CBI +351 21 389 6831 [email protected] José Mota Freitas, CFA CBI +351 22 607 09 31 [email protected]
Javier Bernat BKF +34 91 436 7816 jav [email protected] Henri Parkkinen POH +358 10 252 4409 [email protected]
Dimitris Birbos IBG +30 210 81 73 392 [email protected] Dirk Peeters BDG +32 2 287 97 16 [email protected]
Agnès Blazy CIC +33 1 45 96 77 61 [email protected] Adrian Pehl, CFA EQB +49 69 58997 438 [email protected]
Louise Boyer CIC +33 1 45 96 78 74 [email protected] Victor Peiro Pérez BKF +34 91 436 7812 [email protected]
Jean-Pascal Brivady CIC +33 4 78 92 02 25 [email protected] Francis Prêtre CIC +33 4 78 92 02 30 [email protected]
Giada Cabrino, CIIA BAK +39 02 4344 4092 [email protected] Francesco Previtera BAK +39 02 4344 4033 francesco.prev [email protected]
Arnaud Cadart CIC +33 1 45 96 77 41 [email protected] Jari Raisanen POH +358 10 252 4504 [email protected]
Niclas Catani POH +358 10 252 8780 [email protected] Hannu Rauhala POH +358 10 252 4392 [email protected]
Jean-Marie Caucheteux BDG +32 2 287 99 20 [email protected] Matias Rautionmaa POH +358 10 252 4408 [email protected]
Pierre Chedeville CIC +33 1 45 96 78 71 [email protected] Eric Ravary CIC +33 1 45 96 79 53 [email protected]
Emmanuel Chevalier CIC +33 1 45 96 77 42 [email protected] Iñigo Recio Pascual BKF +34 91 436 7814 [email protected]
Edwin de Jong SNS +312 0 5508569 [email protected] Gerard Rijk SNS + 31 (0)20 550 8572 [email protected]
Nadeshda Demidova EQB +49 69 58997 434 [email protected] André Rodrigues CBI +351 21 389 68 39 [email protected]
Martijn den Drijver SNS +312 0 5508636 [email protected] Jean-Luc Romain CIC +33 1 45 96 77 36 [email protected]
Christian Devismes CIC +33 1 45 96 77 63 [email protected] Jochen Rothenbacher, CEFA EQB +49 69 58997 415 [email protected]
Andrea Devita, CFA BAK +39 02 4344 4031 [email protected] Vassilis Roumantzis IBG +30 2108173394 [email protected]
Hans D'Haese BDG +32 (0) 2 287 9223 [email protected] Sonia Ruiz De Garibay BKF +34 91 436 7841 [email protected]
Ingbert Faust, CEFA EQB +49 69 58997 410 [email protected] Antti Saari POH +358 10 252 4359 [email protected]
Rafael Fernández de Heredia BKF +34 91 436 78 08 [email protected] Paola Saglietti BAK +39 02 4344 4287 [email protected]
Gabriele Gambarova BAK +39 02 43 444 289 [email protected] Francesco Sala BAK +39 02 4344 4240 [email protected]
Alexandre Gérard CIC +33 1 45 96 79 61 [email protected] Lemer Salah SNS '+312 0 5508516 [email protected]
Claudio Giacomiello, CFA BAK +39 02 4344 4269 [email protected] Michael Schaefer EQB +49 69 58997 419 [email protected]
Ana Isabel González García CIIA BKF +34 91 436 78 09 [email protected] Holger Schmidt, CEFA EQB +49 69 58 99 74 32 [email protected]
Arsène Guekam CIC +33 1 45 96 78 76 [email protected] Tim Schuldt, CFA EQB +49 69 5899 7433 [email protected]
Bernard Hanssens BDG +32 (0) 2 287 9689 [email protected] Pekka Spolander POH +358 10 252 4351 [email protected]
Philipp Häßler, CFA EQB +49 69 58997 414 [email protected] Gert Steens SNS +312 0 5508639 [email protected]
Carlos Jesus CBI +351 21 389 6812 [email protected] Kimmo Stenvall POH +358 10 252 4561 [email protected]
Bart Jooris, CFA BDG +32 2 287 92 79 [email protected] Natalia Svyrou-Svyriadi IBG +30 210 81 73 384 [email protected]
Vicente Koki, CNPI CGD +55 1130 744 522 [email protected] Luigi Tramontana BAK +39 02 4344 4239 [email protected]
Jean-Michel Köster CIC +33 1 45 96 77 17 [email protected] Johan van den Hooven SNS +312 0 5508518 [email protected]
Jean-Christophe Lefèvre-Moulenq CIC +33 1 45 96 91 04 [email protected] Robert-Jan van der Horst EQB +4969-58997-437 robert-jan.vanderhorst@equinet
Sébastien Liagre CIC +33 1 45 96 90 34 [email protected] Kévin Woringer CIC +33 1 45 96 77 64 [email protected]
Konrad Lieder EQB +49 69 5899 7436 [email protected]
(**) excluding: strategists, macroeconomists, heads of research not covering specific stocks, credit analysts, technical analysts
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ESN Recommendation System
The ESN Recommendation System is Absolute. It means that each stock is rated on the
basis of a total return, measured by the upside potential (including dividends and capital
reimbursement) over a 12 month time horizon.
The ESN spectrum of recommendations (or ratings) for each stock comprises 5 categories:
Buy, Accumulate (or Add), Hold, Reduce and Sell (in short: B, A, H, R, S).
Furthermore, in specific cases and for a limited period of time, the analysts are allowed to rate
the stocks as Rating Suspended (RS) or Not Rated (NR), as explained below.
Meaning of each recommendation or rating:
Buy: the stock is expected to generate total return of over 20% during the next 12 months time horizon
Accumulate: the stock is expected to generate total return of 10% to 20% during the next 12 months time horizon
Hold: the stock is expected to generate total return of 0% to 10% during the next 12 months time horizon.
Reduce: the stock is expected to generate total return of 0% to -10% during the next 12 months time horizon
Sell: the stock is expected to generate total return under -10% during the next 12 months time horizon
Rating Suspended: the rating is suspended due to a capital operation (take-over bid, SPO, …) where the issuer of the document (a member of ESN) or a related party of the issuer is or could be involved or to a change of analyst covering the stock
Not Rated: there is no rating for a company being floated (IPO) by the issuer of the document (a member of ESN) or a related party of the issuer
History of ESN Recommendation System
Since 18 October 2004, the Members of ESN are using an Absolute Recommendation System (before was a Relative Rec. System) to rate any single stock under coverage.
Since 4 August 2008, the ESN Rec. System has been amended as follow.
Time horizon changed to 12 months (it was 6 months)
Recommendations Total Return Range changed as below:
Disclosure Appendix The information and opinions in this report were prepared by Investment Bank of Greece, which is regulated by the Bank of Greece (License No: 52/2/17.12.99) and by the Hellenic Capital Market Commission. Investment Bank of Greece has not entered any agreement with the subject companies for the execution of this analysis.
This report is for informative purposes only. Under no circumstances is it to be used or considered as an offer to sell, or a solicitation of any offer to buy, any security. While the information contained herein has been obtained from sources believed to be reliable, we do not represent that it is accurate or complete and it should not be relied upon as such. In producing its research reports, members of Investment Bank of Greece research department may have received assistance from the subject company(ies) referred to in this report. Any such assistance may have included access to sites of the issuers, visits to certain operations of the subject company(ies), meetings with management, employees or other parties associated with the subject company(ies) and the handing by them of historical data regarding the subject company(ies) (financial statements and other financial data), as well as of all publicly available information regarding strategy and financial targets. Investment Bank of Greece research personnel are prohibited from accepting payment or reimbursement of travel expenses from site visits to subject companies. It should be presumed that the author(s) of this report, in most cases, has had discussions with the subject company(ies) to ensure factual accuracy prior to publication. All opinions, projections and estimates constitute the judgment of the author as of the date of the report and are given in good faith, but are subject to
BEFORE
-15% 0% 5% 15%
SELL REDUCE HOLD ACCUMULATE BUY
TODAY
-10% 0% 10% 20%
SELL REDUCE HOLD ACCUMULATE BUY
BEFORE
-15% 0% 5% 15%
SELL REDUCE HOLD ACCUMULATE BUY
BEFORE
-15% 0% 5% 15%
SELL REDUCE HOLD ACCUMULATE BUY
TODAY
-10% 0% 10% 20%
SELL REDUCE HOLD ACCUMULATE BUY
TODAY
-10% 0% 10% 20%
SELL REDUCE HOLD ACCUMULATE BUY
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change without notice. Prices and availability of financial instruments also are subject to change without notice. Investment Bank of Greece or one of its affiliates or persons connected with it may from time to time buy and sell securities referred herein. Although Investment Bank of Greece does not set a predetermined frequency for publication, if this is a fundamental research report, it is the intention of Investment Bank of Greece to provide research coverage of the subject company(ies), including in response to news affecting this issuer, subject to applicable quiet periods and capacity constraints. Investment Bank of Greece may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any company mentioned in this report. Investment Bank of Greece does and seeks to do business with companies covered in their research reports. Thus, investors should be aware that the firms may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. Securities referred to in this research report are subject to investment risks, including the possible loss of the principal amount invested. This report is intended for professional investors only and it is not to be reproduced or copied or reprinted or transmitted for any purpose without permission. We certify that this report has been published in accordance with our conflict management policy and guidelines. According to Investment Bank of Greece policies, the Analysis Department of Investment Bank of Greece is bound by confidentiality, with the exception of data allowed to be published in accordance with the applicable laws. Investment Bank of Greece relies on information barriers to control the flow of information in one or more areas within Investment Bank of Greece organization. The communication between the Analysis Department of Investment Bank of Greece and the other departments of the aforementioned company is restricted by Chinese Walls set between the different departments, so that Investment Bank of Greece can abide by the provisions regarding confidential information and market abuse.
Analyst Certification
The following analysts: Dimitris Birbos hereby certify that the views about the companies and securities contained in this report accurately reflect their personal views and that no part of their compensation was or will be directly or indirectly related to the specific recommendations or views in this report.
The analysts mentioned above who prepared this report have the below mentioned financial interests in the companies covered in this report……none……
Important Regulatory Disclosures on Subject Company
The information and opinions in this report were prepared by INVESTMENT BANK of GREECE, which is member of the Athens Exchange S.A. and regulated by the Bank of Greece (License No: 52/2/17.12.99) and by the Hellenic Capital Market Commission.
The compensation of the research analysts, strategists, or research associates principally responsible for the preparation of this research report may depend on various factors such as quality of work, stock picking, client feedback and overall firm profitability.
Stock Ratings
You should carefully read the definitions of all ratings used in the research report. Moreover, you should carefully read the entire research report to obtain a clear view of the analyst’s opinions and not infer its contents from the rating alone.
IBG Research Rating Distribution
Data current as of 26/09/2014
Buy Accumulate Hold Reduce Sell
IBG Research Total Coverage 57% 14% 29% 0% 0%
% of companies in each rating category that are investment banking clients 0% 0% 0% 0% 0%
Note that we have suspended our rating on 1 company
Retail 50% 0% 50% 0% 0%
% of companies in each rating category that are investment banking clients 0% 0% 0% 0% 0%
Regulatory Disclosures on Subject Companies
1. As of the date mentioned on the first page of this report, Investment Bank of Greece (or any of its affiliated companies) owns 5% or more of a
class of common equity securities in the following companies mentioned in this report: None
2. Investment Bank of Greece acts as a market maker for the following securities of the subject companies mentioned in this report: Alpha Bank,
EFG Eurobank, Ellaktor, GEK TERNA, Hellenic Exchanges, Intralot, Mytilineos, National Bank of Greece, OPAP, OTE, Piraeus Bank, PPC
3. Within the last 12 months, Investment Bank of Greece has provided advisory services to the following companies mention in this report: None
4. Within the last 12 months, Investment Bank of Greece had a contractual relationship or have received compensation for financial advisory
services from the following subject companies mentioned in this report: None
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Rating History
1. 11/09/2014 Buy, Target Price EUR 14.30
2. 05/06/2014 Buy, Target Price EUR 14.30
3. 14/04/2014 Buy, Target Price EUR 14.60
4. 19/02/2014 Buy, Target Price EUR 13.30
5. 29/11/2013 Buy, Target Price EUR 13.30
6. 19/11/2013 Hold, Target Price EUR 10.50
7. 16/10/2013 Hold, Target Price EUR 10.50
8. 13/09/2013 Accumulate, Target Price EUR 10.00
Source: Factset & ESN, price data adjusted for stock splits.This chart shows Investment Bank of Greece continuing coverage of this stock; the current analyst may or may not have covered it over the entire period.
Risks to our forecasts and valuation
Group’s earnings performance is sensitive to FX movements is especially the EUR/USD currency pair and manufacturing costs in China.
Challenging macroeconomic conditions in Greece that may have a negative impact in the company’s financial performance, since as a retail
company, Jumbo is affected by factors that influence consumer behaviour.
A stricter competitive environment (i.e. entrance of foreign companies in the Greek market, retail store expansion of existing players) could
pose risk to earnings performance in the medium-term.
Volatility in transportation costs directly affects group’s gross profit margin.
Exposure to developing markets (Romania, Bulgaria) with embedded increased market risks (political, currency, macroeconomic).
The high dependence of the company’s structure from the Chairman and major shareholder of the group.
Additional disclosures
1. Additional note to our U.S. readers: This document may be distributed in the United States solely to “major US institutional investors” as defined in Rule 15a-6 under the US Securities Exchange Act of 1934. Each person that receives a copy, by acceptance thereof, represents and agrees that he/she will not distribute or otherwise make available this document to any other person.
2. All prices and valuation multiples are based on the closing of ATHEX’s last session prior to the issue of this report, unless otherwise indicated
3. Our research reports are available upon request at www.ibg.gr, on Bloomberg’s IBGR and ESNR functions and on Thomson Reuters website.
4. Additional information is available upon request.
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Buy Accumulat Hold Reduce Sell Not rated
Price history Target price history
Disclaimer: These reports have been prepared and issued by the Members of European Securities Network LLP (‘ESN’). ESN, its Members and their affiliates (and any director, officer or employee thereof), are neither liable for the proper and complete transmission of these reports nor for any delay in their receipt. Any unauthorised use, disclosure, copying, distribution, or taking of any action in reliance on these reports is strictly prohibited. The views and expressions in the reports are expressions of opinion and are given in good faith, but are subject to change without notice. These reports may not be reproduced in whole or in part or passed to third parties without permission. The information herein was obtained from various sources. ESN, its Members and their affiliates (and any director, officer or employee thereof) do not guarantee their accuracy or completeness, and neither ESN, nor its Members, nor its Members’ affiliates (nor any director, officer or employee thereof) shall be liable in respect of any errors or omissions or for any losses or consequential losses arising from such errors or omissions. Neither the information contained in these reports nor any opinion expressed constitutes an offer, or an invitation to make an offer, to buy or sell any securities or any options, futures or other derivatives related to such securities (‘related investments’). These reports are prepared for the clients of the Members of ESN only. They do not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive any of these reports. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in these reports and should understand that statements regarding future prospects may not be realised. Investors should note that income from such securities, if any, may fluctuate and that each security’s price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in these reports. In addition, investors in securities such as ADRs, whose value are influenced by the currency of the underlying security, effectively assume currency risk. ESN, its Members and their affiliates may submit a pre-publication draft (without mentioning neither the recommendation nor the target price/fair value) of its reports for review to the Investor Relations Department of the issuer forming the subject of the report, solely for the purpose of correcting any inadvertent material inaccuracies. Like all members employees, analysts receive compensation that is impacted by overall firm profitability For further details about the specific risks of the company and about the valuation methods used to determine the price targets included in this report/note, please refer to the latest relevant published research on single stock or contact the analyst named on the front of the report/note. Research is available through your sales representative. ESN will provide periodic updates on companies or sectors based on company-specific developments or announcements, market conditions or any other publicly available information. 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www.bancaakros.it regulated by the CONSOB - Commissione Nazionale per le Società e la Borsa
www.bekafinance.com regulated by CNMV - Comisión Nacional del Mercado de Valores
www.caixabi.pt regulated by the CMVM - Comissão do Mercado de Valores Mobiliários
www.cgdsecurities.com.br regulated by the CVM – Comissão de Valores Mobiliários
www.cmcics.com regulated by the AMF - Autorité des marchés financiers
www.degroof.be regulated by the FSMA - Financial Services and Markets Authority
www.equinet-ag.de regulated by the BaFin - Bundesanstalt für Finanzdienstleistungsaufsicht
www.ibg.gr regulated by the HCMC - Hellenic Capital Market Commission
www.pohjola.com regulated by the Financial Supervision Authority
www.snssecurities.nl regulated by the AFM - Autoriteit Financiële Markten
Jumbo
Greece General Retailers
Members of ESN (European Securities Network LLP)
Banca Akros S.p.A. Viale Eginardo, 29 20149 MILANO Italy Phone: +39 02 43 444 389
Fax: +39 02 43 444 302
Equinet Bank AG Gräfstraße 97 60487 Frankfurt am Main Germany Phone:+49 69 – 58997 – 410 Fax:+49 69 – 58997 – 299
SNS Securities N.V. Nieuwezijds Voorburgwal 162 P.O.Box 235 1000 AE Amsterdam The Netherlands Phone: +31 20 550 8500 Fax: +31 20 626 8064
Pohjola Bank plc
P.O.Box 308 FI- 00013 Pohjola Finland Phone: +358 10 252 011 Fax: +358 10 252 2703
Caixa-Banco de Investimento Rua Barata Salgueiro, nº 33 1269-057 Lisboa Portugal Phone: +351 21 313 73 00
Fax: +351 21 389 68 98
CM - CIC Securities
6, avenue de Provence 75441 Paris Cedex 09 France Phone: +33 1 4596 7940 Fax: +33 1 4596 7748
Bank Degroof
Rue de I’Industrie 44 1040 Brussels Belgium Phone: +32 2 287 91 16 Fax: +32 2 231 09 04
Investment Bank of Greece 32 Aigialeias Str & Paradissou 151 25 Maroussi Greece Phone: +30 210 81 73 000
BEKA Finance
C/ Marques de Villamagna 3 28001 Madrid Spain Phone: +34 91 436 7813