EMAK SpA – Follow up
Yesterday’s post to EMAK didn’t really contain a lot of hard numbers. So let’s look at some multpiles.
The acquisition itself is summarized in the most recent investor presentation.
In order to put the complete price tag on the acquisition, one has to make a few calculations. Based on the presentation, I would calculate the total purchase price (equity payment + assumed debt) as follows:
82,7 mn Equity paymnent
10,6 net debt Comet
2,0 net debt Raico
0,3 net debt Sabart
23.4 net debtTecomec
Total 119 mn EUR
EMAK gets the follwoing EBITDA (2010):
7.9 Tecomec
5,3 Comet
3,0 Sabart
0,9 Raico
total 17.1 EBITDA 2010 which would result in a purchase multiple of 7 times EV/EBITDA
After the acquisition, EMAK is targeting 3 mn EBITDA of synergies, sow inlcuding those synergies the purchase would have been priced at 6 x EV/EBITDA for 2010.
For EMAK this would mean after the acquisition ~ 100 mn EUR total debt. At current prices, EMAK’s equity is valued around 90 mn EUR. So total EV is 190 mn.
2011 EBITDA is expected around 40 mn EUR, the Group is targeting 58 mn EUR EBITDA for 2013.
Baes on this, the current share price represents ~ 4.7 EV/EBITDA for 2011 and around 3.3 x EV/EBITDA for 2013.
Historically, EMAK traded around 5-6x EV/EBITDA. The historical numbers show a rock solid steady company which was almost not impacted by any crisis:
| TRAIL_12M_EPS | EBITDA_PER_SH | BOOK_VAL_PER_SH | DVD_SH_12M | |
|---|---|---|---|---|
| 1999 | 0.046 | 0.145 | 0.518 | 0.020 |
| 2000 | 0.075 | 0.182 | 0.566 | 0.025 |
| 2001 | 0.097 | 0.237 | 0.628 | 0.034 |
| 2002 | 0.106 | 0.265 | 0.691 | 0.042 |
| 2003 | 0.112 | 0.276 | 0.757 | 0.046 |
| 2004 | 0.104 | 0.260 | 0.812 | 0.047 |
| 2005 | 0.110 | 0.262 | 0.880 | 0.047 |
| 2006 | 0.132 | 0.296 | 0.960 | 0.049 |
| 2007 | 0.179 | 0.353 | 1.079 | 0.057 |
| 2008 | 0.176 | 0.376 | 1.178 | 0.071 |
| 2009 | 0.112 | 0.258 | 1.222 | 0.049 |
| 2010 | 0.138 | 0.280 | 1.333 | 0.049 |
Finally, after a somehow slower first half year, the 3rd Quarter results acutally were quite good. Lower sales in the Italian home market were more than set off by increasing sales in emerging markets.
So let’s wait and see, but for a relatively defensive company, EMAK looks really cheap.
value and opportunity 