First Read Avolta: Results call takeaways with the CEO & CFO

研报英文原文证据摘录

First Read Avolta: Results call takeaways with the CEO & CFO

ina). The UBS Cons.

ramp-up headwinds are linked to eg, personnel staff productivity, delayed shop 12/26E 3.05 3.26

openings and supply chain learnings (China). The company stated these negative effects 12/27E 3.55 3.81

will gradually improve from here but will still impact profitability somewhat in the next 12/28E 3.89 4.32

quarters. The company expects these margin headwinds will be fully washed out later in

2027E. We reiterate our view and see low- to mid-single-digit downside risk to Joern Iffert, CFA

Analyst

consensus earnings,.

joern.iffert@ubs.com

+41-44-239 88 00

Other takeaways

Marti Queral Ferre, CFA

(1) Avolta remains confident on cash conversion and does not see any special effects

impacting EFCF in H2 26E. Capex might accelerate a bit from the quite low levels in H1 marti.queral-ferre@ubs.com

26, but cash tax payments could slow down offsetting it. We think a EFCF range of +41-44-236 9246

cCHF420-480m is fair to assume for 2026E. (2) Avolta confirms its 2027E mid-term

Ivar Billfalk-Kelly

targets and was not commenting on detailed assumptions afterwards (looks fair to us Analyst

but we would expect its organic sales prospects to be slightly shy of 5% medium term ivar.billfalk-kelly@ubs.com

rather than above 5% vs current targets of +5-7% y/y). (3) On capital allocation, the +44-20-7568 3240

company will continue to have a strong focus on cash return to shareholders which

remains a positive to us.

Valuation: DCF based PT of CHF52; conclusion

We think company is executing soundly and organic sales remain resilient supported by

some initiatives. However ramp up costs will impact margins and we see some downside

risk to consensus. Hence we expect more mixed investor sentiment near term.