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Original-Research: Havila Kystruten AS - from Montega AG
Classification of Montega AG to Havila Kystruten AS
Company Name: Havila Kystruten AS
ISIN: NO0011045429
Reason for the research: Update
Recommendation: Kaufen
from: 03.06.2024
Target price: 2,80 NOK
Target price on sight of: 12 Monaten
Last rating change: -
Analyst: Tim Kruse (CFA)
Havila Q1: good but not great (yet)
Havila Kystruten AS reported the figures for Q1 2024 last Thursday in
conjunction with its annual shareholder meeting. The company also held its
first quarterly earnings call, which as a further step in the managements
intention to increase capital market activities. Even if we had expected
Havila to break even on EBITDA level in Q1 we would not overrate this
quarter, as all relevant KPIs are moving in the right direction and there
were also some one-offs in Q1.
Overall sales in the first quarter amounted to 292.9 m NOK which fell short
of our expectation (312.2 m NOK) due to two reasons. Firstly, the
contractual revenue (Actual: 96.9 m NOK vs. MONe 102.7 m NOK) from the
government was lowered by 5.7 m NOK due to an accounting effect. The
contract with the Ministry of Transport includes an option to extend the
contract by one year after 2030. The option rate differs from the rate in
the fixed period so that this revenue loss is spread over the entire
contract period. We had not yet reflected this non-cash effect in our
estimates and have changed them accordingly. Secondly, the average cabin
rate (ACR) of 3.900 NOK came in slightly below expectation albeit having
increased considerably against the previous and last years Quarter (3.100
and 3.000 NOK respectively). The company sees good potential to increase
ACR, as realized prices are still influenced by ticket sales from the
previous years, where the company had to deal with several cancellations
and current trips sold are showing significantly better prices.
EBITDA came in at -17.5 m NOK which was below our expectation (+29 m NOK).
Apart from the above mentioned effects LNG cost as well as material
expenses where higher than expected, which we are reflecting in our lowered
full year expectations. Also personnel cost were inflated due training
expenses in the light of the ramp-up of operations. Havila will be facing
its first high season with full operations of all four ships this year.
Therefore the company is busy digesting the sacle-up in operations at the
moment but will increase attention to streamlining operations and occupancy
across the route. An indication of these efforts is the launch of the 'Pure
Northern Collection'. This specially curated package, which includes a
morning flight from Oslo as well as a variety of hand-picked excursions in
the Arctic wonderland of Kirkenes, should increase the occupancy of the
usually less populated southern route. We therefore remain confident that
margins will improve considerably from here on out albeit having lowered
our estimates to account for Q1 cost levels.
Industry parameters promising: In the past months the cruise line industry
has shown a strong booking development leading to record Q1 numbers and an
increased outlook for all of the the top three cruise line operators
(Carnival, Norwegian, Royal Caribbean). Although the direct overlap with
the coastal express should be limited it does reflect the overall demand
and appetite for cruise holidays which should also support the Coastal
Express and Havila.
Conclusion: Even if Havila did not quite achieve our expectation in Q1 we
are satisfied with the overall development. We believe this investment case
will unfold over several quarters and are certain their moat will widen as
time goes by. With significantly positive FCF and the new revolving credit
facility of 200 m NOK we see Havila well financed and have lowered our beta
to reflect the refinancing of the tranch a bond. We therefore reiterate
price target and recommendation.
+++ 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
wird durch erfolgreiches Stock-Picking stetig erweitert. Montega versteht
sich als ausgelagerter Researchanbieter für institutionelle Investoren und
fokussiert sich auf die Erstellung von Research-Publikationen sowie die
Veranstaltung von Roadshows, Fieldtrips und Konferenzen. Zu den Kunden
zählen langfristig orientierte Value-Investoren, Vermögensverwalter und
Family Offices primär aus Deutschland, der Schweiz und Luxemburg. Die
Analysten von Montega zeichnen sich dabei durch exzellente Kontakte zum
Top-Management, profunde Marktkenntnisse und langjährige Erfahrung in der
Analyse von deutschen Small- und MidCap-Unternehmen aus.
You can download the research here:
http://www.more-ir.de/d/29947.pdf
Contact for questions
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
-------------------transmitted by EQS Group AG.-------------------
The issuer is solely responsible for the content of this research.
The result of this research does not constitute investment advice
or an invitation to conclude certain stock exchange transactions.
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