Buy
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Original-Research: HORNBACH Holding AG & Co. KGaA - from Quirin Privatbank Kapitalmarktgeschäft
Classification of Quirin Privatbank Kapitalmarktgeschäft to HORNBACH Holding AG & Co. KGaA
FY 2024/25: all targets achieved HORNBACH reported a slight increase in net sales for FY 2024/25, reaching EUR 6,200m, primarily driven by the HORNBACH Baumarkt subgroup. Gross profit improved by 3.6%, attributed to lower raw material prices, new product introductions, and a favorable product mix. However, operational expenses as a percentage of sales rose due to wage increases and the SAP S/4 Hana system migration. Adjusted EBIT rose by 6.0% to EUR 269.5m, reflecting stronger gross margins despite ongoing investments in staff and technology. The adj. EBIT margin increased from 4.1% to 4.3%. The company maintained a robust balance sheet with an equity ratio of 44.1%. HORNBACH also improved its market position, with notable market share gains in Germany, the Netherlands, Czechia, Austria, and Switzerland. In addition, the company demonstrated its efficient use of retail space, achieving market-leading sales per square meter, and showed above-average growth in the DIY sector compared to the German GDP. It also continued expanding its product offerings through its online marketplace and app, the latter now supporting over 4.1m customer accounts. HORNBACH published a FY 2025/26 outlook: Net sales are expected to be at or slightly above the level of the 2024/25 financial year. Sales growth will be supported by recently opened stores in Nuremberg (February 26, 2025) and Duisburg (March 26, 2025) as well as three further new openings in Austria and Romania during FY 2025/26. According to HORNBACH, the start of the spring season has been promising, however the volatile macroeconomic and geopolitical environment poses continued challenges with regard to supply chains and consumer sentiment. Therefore, the adjusted EBIT is expected to be at the level of the past business year (EUR 269.5m) with gross margin remaining stable. In our opinion, Hornbach's outlook is rather cautious/conservative, especially due to the successful start to the spring season. We therefore confirm our Buy recommendation and the EUR 110 TP. You can download the research here: http://www.more-ir.de/d/32736.pdf For additional information visit our website: https://research.quirinprivatbank.de/ Contact for questions: Quirin Privatbank AG Institutionelles Research Schillerstraße 20 60313 Frankfurt am Main research@quirinprivatbank.de https://research.quirinprivatbank.de/
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2146406 27.05.2025 CET/CEST
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