14 August 2024 | 10:13AM AEST 2131d4eaf4cb4d50b1d51c8af07b64b4 Orora Ltd. (ORA.AX): First Take: FY24 above expectations, outlook broadly consistent; in talks to divest OPS; Buy FY24 ahead of expectations: ORA's FY24 EBIT (ex Saverglass) came in at A$323m, vs company's guidance range of A$307-317m, 5%/6% higher than GSe and Visible Alpha Consensus Data estimates. Headline Saverglass AUD EBIT was 13% ahead of GSe (benefiting from D&A adjustments). Reported underlying NPAT was 9% ahead of GSe and 10% above con ...

13 August 2024 | 7:59PM BRT 2131d4eaf4cb4d50b1d51c8af07b64b4 Oncoclinicas (ONCO3.SA): 2Q24 first take: High organic cash consumption on still-pressured receivables ONCO's EBITDA was virtually in line with our expectation, but financial results and minority interest were weaker than expected; recurring cash consumption was worse than expected on receivables pressure. We note that reported net income for controlling shareholders of BRL 3mn missed GSe of BRL 60mn for the abovementioned reasons below EBITDA, wh ...

Investment Rating - The report maintains a "Buy" rating for ON Holding (ONON) with a 12-month price target of $50, reflecting a potential upside of approximately 26.4% from the current price of $39.55 [2][3]. Core Insights - ON Holding reported strong demand trends despite short-term supply constraints in the US, with 2Q24 adjusted EBITDA of CHF 90.8 million and net sales of CHF 567.7 million, representing a year-over-year growth of 27.8% and a constant currency growth of 29.4% [2][3]. - The company reiterated its FY24 guidance, expecting constant currency sales growth of at least 30% and net sales of at least CHF 2.26 billion, with a gross margin around 60% [2][3]. - The report highlights significant growth in sales across regions, with APAC showing an impressive 84.7% growth, while EMEA and Americas grew by 22.2% and 25.8%, respectively [2][3]. Financial Performance - The report indicates that ON Holding's gross margin improved to 59.9%, up 40 basis points year-over-year, with adjusted EBITDA margins projected between 16% and 16.5% for FY24 [2][3]. - The forecast for FY24E revenue is set at CHF 2,261.2 million, with an expected EBITDA of CHF 373 million [3][7]. - The report also notes a decrease in the FY24E net finance income estimate by approximately CHF 30 million due to unrealized foreign exchange losses, leading to an adjusted diluted EPS of CHF 0.58 [2][3]. Market Position and Growth Strategy - The report emphasizes the shift towards direct-to-consumer (DTC) sales, projecting that DTC sales will account for approximately 51% of total sales by 2031, up from around 40% in 2024 [4][5]. - The anticipated increase in DTC sales is expected to drive a premium gross margin of around 63% and an EBIT margin of 18% by FY31 [5][6]. - The report outlines a long-term growth strategy that includes maintaining strong sales growth and improving operational efficiency to align with European peers [5][6].

13 August 2024 | 10:54AM BST 2131d4eaf4cb4d50b1d51c8af07b64b4 ON Holding (ONON): First Take: 2Q24 adj. EBITDA +5% beat; FY24 guidance reiterated News: On Holding reported 2Q24 adj. EBITDA of CHF 90.8mn, +5.3% above FactSet consensus of CHF 86.2mn, driven by net sales of CHF 567.7mn, +27.8% yoy and +29.4% cFX (consensus CHF 562mn, +26% yoy and Visible Alpha Consensus Data +30.1% cFX). Group gross margin came in at 59.9%, +40bps yoy (FactSet consensus +60bps yoy to 60.1%), with adj. EBITDA margins of 16% (con ...

13 August 2024 | 6:57PM HKT Ocumension (1477.HK): Earnings Review: 1H in-line with narrower loss; Alcon partnership opportunity in dry eye; Buy 1H product sales in-line; narrower loss with lower spending: 1H revenue of Rmb168mn (+62% y/y, or +18% h/h, vs. GSe of Rmb170mn) was mostly in line with lower product sales of Rmb150mn (vs. GSe of Rmb169mn) given the slower ramp-up of Yutiq due to supply constraints (see our Corporate Day note), which in our view may have contributed to a decreased GPM of 59.2% (vs. ...

13 August 2024 | 2:44PM PDT NCR Atleos (NATL): 20 First Take: Revenue, margins and EPS at or above consensus, with ATMaaS strategy continuing to advance We expect investors to have a neutral-to-positive reaction to NCR Atleos' 2Q 2024 earnings release, its second as a standalone public entity, with EBITDA margins and EPS surpassing consensus expectations, revenue coming in line with the Street and the full-year quide reaffirmed for these metrics. Revenue increased 4% y/y and recurring revenue grew 9%, while ...

Investment Rating - The report assigns a 12-month price target of R$19 for Natura&Co, indicating an upside potential of 16% from the current price of R$16.38 [16]. Core Insights - Natura&Co reported robust growth in the Natura brand in Brazil, with sales exceeding expectations by 9%, although adjusted EBITDA only beat expectations by 3% due to lower profitability in Latam and weak performance at Avon International [2][3]. - The company continues to face challenges with negative free cash flow of -R$675 million, but management expects to reduce leverage in the second half of 2024 through cash generation and EBITDA growth [3][10]. - The corporate restructuring of Avon Products Inc is a focal point for investors, with potential implications for Natura&Co's operations [3][11]. Summary by Sections Financial Performance - Natura&Co Latam revenues grew by 10% year-over-year, driven primarily by the beauty category, despite a 19% decline in the unified representative base [4][6]. - The Natura brand in Brazil saw sales growth accelerate to 15% year-over-year, while Avon brand sales in Brazil dropped by 1% [6][7]. - Adjusted EBITDA margin increased by approximately 85 basis points, primarily due to improved gross margins in the Latam operation [9]. Corporate Restructuring - Avon Products Inc filed for Chapter 11 in the US, with Natura&Co committing to provide US$43 million in debtor-in-possession financing to support Avon during the restructuring process [11][12]. - Natura&Co plans to bid US$125 million to acquire Avon’s operations outside the US, contingent on a court-supervised auction process [12]. Market Outlook - The report highlights the importance of cash generation and working capital management, noting that accounts receivable have increased due to a higher share of Natura Brazil and productivity representatives [3][10]. - Management anticipates improvements in logistics and inventory management in the second half of 2024, which may lead to temporary volatility in service levels [8].

13 August 2024 | 5:05PM EDT Mosaic Co. (MOS): Management meeting highlights Phosphate market optimism and cost initiatives; Buy We hosted a virtual meeting with MOS management today (8/13), including CEO Bruce Bodine, CFO Clint Freeland, and EVP of Commercial Jenny Wang, Overall, we come away encouraged by management's optimism on Phosphate (P) markets and internal production/cost initiatives as we head into the 2H. The discussion focused primarily on MOS' P operations, where management emphasized tight glo ...

Investment Rating - The report maintains a "Buy" rating for Melco Resorts & Entertainment Ltd. (MLCO) with a 12-month price target of $9.70, indicating an upside potential of 87.6% from the current price of $5.17 [2][3]. Core Insights - The report highlights that MLCO's market share in Macau is expected to improve due to reinvestment in product and service quality, despite facing higher costs [4][6]. - The company has experienced a decline in non-gaming revenue but managed to grow its gaming revenue by 6% quarter-over-quarter, reflecting successful property upgrades and new initiatives [4][5]. - Management is cautiously optimistic about the business outlook, noting improved GGR momentum in late July and August, with daily GGR reaching $653 million in the first two weeks of August [6][7]. - The report revises FY24E-26E EBITDA estimates down by 6% to 5% due to lower margins and GGR trends, but expects EBITDA to reflect market share momentum moving forward [8]. Financial Summary - MLCO's total revenue is projected to grow from $3,775.2 million in 2023 to $5,140.4 million by 2026, with EBITDA increasing from $961.7 million to $1,346.1 million over the same period [3]. - The company reported a net debt of $6.0 billion with a net leverage ratio of 5.3x, indicating stable financial health despite refinancing activities [5][6]. - The report notes that MLCO's GGR market share improved by 0.7 percentage points quarter-over-quarter to 15%, with specific properties showing varied performance [5][7].

13 August 2024 | 2:07PM EDT Midday Market Intelligence: disinflation-nation US stocks are trading higher on Tuesday as investors digest a softer-than-expected July PPI report ahead of tomorrow's CPI release. back to micro? The producer price index (PPI) increased by 0.1% in July, somewhat below expectations, with the PPI excluding food and energy remaining unchanged (vs. consensus +0.2%) and the PPI excluding food, energy, and trade services increasing 0.3% (vs. consensus +0.2%) (see "USA: Core Producer Pri ...