3Q12 EBITDA in line with
market expectations
Cimsa reported 3Q12 net earnings of TRY37m, down 21% y-y, 11% q-q. The bottom line is 8% below our estimate and 9% below CNBC-e consensus. While 3Q12 net sales grew 8% y-y to TRY244m, 3Q12 EBITDA was almost flat at TRY69m as higher electricity prices narrowed margins. Higher than expected financial expenses drove EPS lower.
Challenging environment for growth
Domestic revenue grew 14% y-y to TRY200m in 3Q12. Local demand in the Mediterranean region grew respectively by 5.6% and 1.5% in July and August on y-y terms, which should have helped the top line. Domestic demand in the Central Anatolia region contracted in the same period. Export sales declined 13% y-y to USD34m on weaker export markets.
BUY maintained
We maintain our BUY rating on the back of 19% upside potential on a 12- month horizon. Undemanding multiples, attractive dividend yield and stable demand dynamics render Cimsa the most defensive name in the cement sector. That said, it remains a top-down call and macro risks leading to a construction slow-down is the main downside risk.
Cimsa reported 3Q12 net earnings of TRY37m, down 21% y-y, 11% q-q. The bottom line is 8% below our estimate and 9% below CNBC-e consensus. While 3Q12 net sales grew 8% y-y to TRY244m, 3Q12 EBITDA was almost flat at TRY69m as higher electricity prices narrowed margins. Higher than expected financial expenses drove EPS lower.
Challenging environment for growth
Domestic revenue grew 14% y-y to TRY200m in 3Q12. Local demand in the Mediterranean region grew respectively by 5.6% and 1.5% in July and August on y-y terms, which should have helped the top line. Domestic demand in the Central Anatolia region contracted in the same period. Export sales declined 13% y-y to USD34m on weaker export markets.
BUY maintained
We maintain our BUY rating on the back of 19% upside potential on a 12- month horizon. Undemanding multiples, attractive dividend yield and stable demand dynamics render Cimsa the most defensive name in the cement sector. That said, it remains a top-down call and macro risks leading to a construction slow-down is the main downside risk.
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