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Original-Research: Havila Kystruten AS - von Montega AG
Einstufung von Montega AG zu Havila Kystruten AS
Unternehmen: Havila Kystruten AS
ISIN: NO0011045429
Anlass der Studie: Initiation of Coverage
Empfehlung: Buy
seit: 05.02.2024
Kursziel: 2.80 NOK
Kursziel auf Sicht von: 12 Monaten
Letzte Ratingänderung: -
Analyst: Tim Kruse, CFA
Back on course after the perfect storm
Havila Kystruten AS is a cruise line operator from Norway. Founded in 2017,
it is the only company besides the incumbent Hurtigruten Group AS mandated
by the Norwegian government to serve the 130 year old post ship service
from Bergen to Kirkenes. Next to the port-to-port service for locals, their
four vessels offer all the amenities and activities of a modern cruise ship
tailored for tourists visiting the Norwegian coast.
Shortly after winning the contract and placing a shipbuilding order with
two shipyards in 2019, Havila was hit by the perfect storm with one of the
shipyards going bankrupt,COVID-19, and their Russian fleet financier GTLK
falling under sanctions. This brought the company to the brink of
bankruptcy. Consequently, shareholders have had a rough voyage so far with
depressed sales and earnings development due to substantially delayed
delivery of the ships. Also, the company had to refinance under
unfavourable conditions leading to a massive dilution for shareholders and
high interest rates.
That said, the market for cruises in general, and the Coastal Express in
particular, has seen increasing demand in the past decade, with yearly
passenger numbers rising in the high single digits up until 2019. COVID hit
the industry severely, but cruises have come back strongly, with passenger
numbers set to surpass 2019 levels this year and growth rates expected to
be in the mid to high single digits going forward.
The rising popularity of the coastal route, combined with the government's
support, has enabled the incumbent, Hurtigruten Group AS, to achieve solid
EBITDA margins in excess of 25% for this part of their business. However,
due to Havila's brand-new and identical ships, which enable significantly
leaner operations, as well as a more consistent and tailored customer
experience, we see Havila in an excellent position to outperform its
competitor. Additionally, the much better environmental footprint of its
fleet not only attracts a more eco-friendly and younger target group, but
will also serve as a strong differentiator if emission regulation is
imposed for parts of the route as proposed. Due to the high investment
backlog of Hurtigruten (average fleet age ~ 30years) in combination with
its already crushing leverage (Net debt/EBITDA 9.6), we see Havila well
positioned to not only prolong their current contract ending in 2030 but
also to win additional capacity from their main rival.
2024 will be the first full year with all ships in operation, which will
lead to another jump in revenue of which 50% has already been pre-sold. and
a disproportionate increase in EBITDA due to the strong operating leverage
exhibited by the cruise line industry. Thereafter, rising occupancy levels
from increasing word-of-mouth effects and streamlined operations should
further improve margins. Furthermore, the expected refinancing closer to
industry spreads will be an additional driver for FCF development.
Conclusions: The disadvantageous news flow Havila had to endure so far has
led to a significant mispricing of Havila's shares with a discount of 75%
to our estimate of fair value indicated by all valuation models (DCF
scenarios, peer group, net asset value). However, the ramp-up in operations
will not only lead to a strong uptake in free cashflow, but should also
pave the way for a more favourable refinancing, which should be the main
catalysts for a re-rating. We therefore see current levels as a unique
opportunity to invest in a profitable niche market safeguarded by
monopolistic revenuestreams and initiate with a 'Buy' rating and a price
target of 2.80 NOK per share.
+++ Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte. Bitte lesen Sie unseren RISIKOHINWEIS /
HAFTUNGSAUSSCHLUSS unter http://www.montega.de +++
Über Montega:
Die Montega AG ist eines der führenden bankenunabhängigen Researchhäuser
mit klarem Fokus auf den deutschen Mittelstand. Das Coverage-Universum
umfasst Titel aus dem MDAX, TecDAX, SDAX sowie ausgewählte Nebenwerte und
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Top-Management, profunde Marktkenntnisse und langjährige Erfahrung in der
Analyse von deutschen Small- und MidCap-Unternehmen aus.
Die vollständige Analyse können Sie hier downloaden:
http://www.more-ir.de/d/28815.pdf
Kontakt für Rückfragen
Montega AG - Equity Research
Tel.: +49 (0)40 41111 37-80
Web: www.montega.de
E-Mail: research@montega.de
LinkedIn: https://www.linkedin.com/company/montega-ag
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Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw.
Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatung
oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.
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