TPG to post small rise in Q1 Operating Profit
TPG NV will report on Wednesday a small rise in operating profit over the first quarter, while net earnings will come in lower, analysts said.
Operating profit from continuing operations is expected to show a single-digit rise from 277 mln eur last year, led by margin improvement at Express and Logistics. A positive outlook for the Express division could push the stock higher, analysts expect.
Net earnings will fall from 196 mln eur a year earlier, when the company booked 59 mln eur in net one-time gains. TPG may take a 5 mln eur miscellaneous charge in the first quarter 2002, some analysts said.
Analysts at Societe Generale said they expect TPG to show overall stability in its businesses despite difficult market conditions. The broker reiterated a ‘buy’ advice on the stock with a 27 eur price target. They estimate operating profit of 296 mln eur on sales up 1.1 pct to 2.805 bln. Net earnings will drop to 156 mln eur.
SG forecasts a 1 pct fall in operating profit at the Mail division with a small drop in margins, largely due to lower advertising. They expect sales growth at Express to accelerate to 8.3 pct, though margins will still suffer from losses in Australia.
Delta Lloyd estimates operating profit of 289 mln eur on sales up 4.7 pct to 2.812 bln. Net earnings are forecast down to 145 mln eur or 0.30 eur per share.
The broker expects Express to still be under pressure, showing 1 pct sales growth and a 30 basis-point improvement in the operating margin to 3.6 pct. Logistics should maintain double-digit sales growth, with the margin rising to 4.9 pct.
Lehman Brothers repeated a ‘buy’ rating and 28.6 eur price target on TPG shares ahead of the report. They forecast sales up 2.4 pct at Express with improving margins. Logistics should post 5 pct organic sales growth.
Analysts at Bear Stearns expect TPG could also come with the appointment of a new CFO, after the previous finance director Peter Bakker took over as CEO earlier this year. Any announcement would be positive as completing the process would free up management attention, the broker said.
