Duna House’s adjusted core revenue improved year-on-year (+14%), however stagnated on a quarterly foundation. This was primarily as a result of improved core EBITDA of the Hungarian (+28% quarter/quarter) and Polish (+160% quarter/quarter) actions, whereas the core EBITDA of the nonetheless weak Italian exercise fell by 43 % on a year-on-year foundation.
The tempo of the slowdown in Italian exercise has shocked the administration, and so they count on a weaker core revenue than earlier than, though the end result should still be within the deliberate vary. This would imply an EPS of HUF 60 in comparison with the EPS of HUF 45 within the first 9 months. Due to quite a few one-time and non-cash gadgets, the reported revenue was HUF 267 million (-53% yr/yr), in comparison with the core revenue of HUF 561 million.
The most essential positives of the third quarter report:
- Hungarian core enterprise clearly reached its lowest level within the first quarter and continued to enhance within the third quarter.
- The exercise in Poland induced a optimistic shock: EBITDA jumped to HUF 133 million from HUF -50 million within the third quarter of final yr.
- A strategic cooperation was established with the biggest actual property company in Italy (+22% upside potential in comparison with the EBITDA of the pure core exercise) – this alone is approx. HUF 200/share represents an further worth based mostly on administration’s expectations.
- Scope affirmed Duna House’s bond score and outlook.
The most essential negatives of the third quarter report:
- Management warned that core revenue might solely attain the decrease finish of the forecast vary.
- The slowdown additionally continued within the Italian phase;
In Concorde’s opinion, the Hungarian and Polish exercise knowledge are a reassuring signal that the credit score intermediation within the area has handed the underside of the cycle. In Hungary, the brand new housing subsidy system (CSOK+) can provide the sector a tailwind, whereas in Poland, the regulatory authority has eased the PIT (income-related cost situations) situations, which provides impetus to lending (the quantity of mortgage mediation was the strongest in October). These measures clearly assist Duna House’s monetary indicators, however the true tailwind might be if the rate of interest discount cycle of the principle central banks begins. According to Concorde, traders do not need to attend lengthy for this. According to the analyst home, Duna House can overcome probably the most tough part of the cycle and are available out of it stronger. Especially in Italy, the place the phase will likely be supported by unique offers from the biggest actual property company.
Concorde beforehand put Duna House’s goal value below overview, however there’s nonetheless no change.
The value of Duna House fell by 0.7 % at this time, whereas this yr it’s up 42.7 %.
Evolution of Duna House’s alternate fee
Cover picture supply: Budapest Stock Exchange