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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
TRANSPORTATION
€500m 5Y IPT MS+105a vs. FV +65 (-40)
DKK 10b = €1.34b, FY is 12m ending December
- DSV is a DKK150b/€20b transport & logistics company that runs high single to low double digit EBIT margins. Between Air&Sea, Road & Solutions its revenue is split 60/24/15% and EBIT 75/11/13% (in FY23). In 1Q results it left FY24 EBIT guidance was unch for DKK15-17b (consensus is at midpoint) which would be a circa 8% fall yoy.
- It targets "gearing ratio" (net debt to EBITDA) of <2x. FY23 it ended with DKK41b/1.8x gross leverage and net of the 6.5b in cash left it 1.5x levered. FCF was 11.5b (down from 22.8b) with it paying out 15.4b to equity holders (reflecting headroom on leverage).
- Note it caveats net 2x ceiling by adding "the ratio may exceed this level following significant acquisitions". On that note it is a finalist bidder for Deutsche Bahn's (Aa1/AA-) logistics unit DB Schenker with valuation around the ~€14b mark in latest reports; {NSN SDVYVFDWRGG0 <GO>}. We'd note in the last 5years it has always kept net leverage in 1-2x range and in-line with that its last rating change was a upgrade from S&P (to A-) in 2018.
- It's coming in-line here, secondary is +1-2, image below captures that. No firm view but at high-level does look cheap vs. Maersk (Baa1/BBB+) who has more pure exposure to shipping and lower margin (though larger in scale at €50b rev's).
- Note we have cheap views in postal Co's IDSLN28s and new PNLNA31s included below. Also note that private co Otto Group (unrated) has a mandate out for 4.3Y - it has logistics divisions as well though more to do with warehousing and parcel delivery on ground.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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