Revolution Bars Group (RBG) : Corp

Return to LFL sales growth drives EBITDA growth

Key data

  • Share price (p) 68.0
  • Target price (p) 120.0
  • Market cap (£m) 34.0
  • Enterprise value (£m) 42.4

RBG has reported much improved results with like-for-like sales growth driving an improvement in Adj EBITDA and Adj PBT and a significant reduction in debt. Management has flagged a return to self-funded estate expansion in FY21, once net debt/Adj EBITDA is <1x, and is on track to deliver this. Trading momentum continued to strengthen with an improvement in LFL sales in Q2 versus Q1 across both its Revolucion de Cuba and Revolution formats, driven by another record Xmas trading period. It is clear the stabilisation of the management team, the investments made in the core estate, and other strategic priorities highlighted after Rob Pitcher commenced work as CEO in June 2018 are bearing fruit.

Mark Paddon 020 7220 0541 mpaddon@finncap.com

Avingtrans (AVG) : Corp

Interim results – in line with expectations

Key data

  • Share price (p) 315.0
  • Target price (p) 315.0
  • Market cap (£m) 98.8
  • Enterprise value (£m) 107.1

Interim results show good underlying progress in the period and signal that the group is on track for full-year expectations, with only a limited risk currently seen from coronavirus. We make only minor changes to forecasts associated with the adoption of IFRS16, which leaves EPS unchanged. We slightly increase our price target from 300p to 315p, based on a targeted 2021 P/E of 15.5x and EV/EBITDA of 7.8x (pre-IFRS16 basis). The shares have seen a decent run recently, placing them fairly close to our price target. Recent acquisitions mean EPS-based targets tend to undervalue the group with potential for either further acquisitive activity or unlocking value through disposals acting as a share price catalyst.

David Buxton 020 7220 0542 dbuxton@finncap.com

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