Original-Research: Einhell Germany AG (von NuWays AG): BUY

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Original-Research: Einhell Germany AG - from NuWays AG

23.08.2024 / 09:01 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
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Classification of NuWays AG to Einhell Germany AG

Company Name: Einhell Germany AG
ISIN: DE0005654933

Reason for the research: Update
Recommendation: BUY
from: 23.08.2024
Target price: EUR 84.00
Last rating change:
Analyst: Mark Schüssler

Final Q2 results & guidance confirmed; 1:3 share split; chg.

Yesterday, Einhell released final Q2 results with sales amounting to EUR 307m
or +11.1% yoy, implying a stronger Q2 performance than initially expected by
management after releasing preliminary Q2 results in June (sales of EUR 295m
or vs. eNuW: EUR 292m). Once again the satisfactory sales development was
driven by an ongoing strong demand for the company's Power X-Change products
(H1'24: 51% PXC share; +5ppts yoy). Q2 sales in DACH came in at EUR 135m
(+6.3% yoy), still making up the bulk of overall revenue with c. 43% of
Group sales. Western Europe grew by 6.2% yoy to EUR 57m, while Eastern Europe
performed strongly, growing 30% yoy to EUR 35m as a result of stronger demand
in Turkey, Croatia, and Poland. Overseas and Other Countries grew 13.7% to EUR
65m, driven by solid performance of Einhell Australia (formerly Ozito),
offset by top-line challenges in both Canada and South Africa.

EBT for Q2'24 was EUR 27.5m (+14.6% yoy) with an EBT margin of 9% (+0.3ppts
yoy), mainly due to operating leverage, offset by PPA effects with regards
to the acquisitions in Thailand and Vietnam. While the gross margin was
roughly on par with last year's figure due to easing but still noticeable
cost inflation (41.4% or +1ppts yoy), personnel expenses grew 9% yoy to EUR
35m (11.5% of sales) as an increased employee base in combination with the
acquisitions in Thailand and Vietnam weighed on operating profitability.
Other operating expenses also increased markedly by 11.8% to EUR 59m (19.2% of
sales) as the revenue share expended on marketing and advertising increased
by 1.7ppts to 7.4% of sales in H1.

Einhell confirmed its FY24e guidance of 6% sales growth yoy to around EUR
1,030m (eNuW: EUR 1,035m) and sees its EBT margin at the upper end (8%) of the
7.5-8% guidance corridor (eNuW: 7.6%). In our view, this continues to look
achievable as the healthy sales growth and solid EBT profitability in Q1 and
Q2 should provide confidence, aided by a less challenging H2'23 comparable
base. Given that Einhell has a sound track record of expanding
internationally via M&A, a targeted US market entry should provide the
company access to the largest DIY market globally and help with rolling-out
its leading Power X-Change platform there.

Due to a 1:3 stock split and the increased share count we have adjusted our
model and PT accordingly and reiterate our BUY rating post-split with a PT
of EUR 84 (pre-split: EUR 227), based on DCF.

You can download the research here: http://www.more-ir.de/d/30603.pdf
For additional information visit our website: www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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1973571 23.08.2024 CET/CEST

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Quelle: dpa-AFX