Latest news with #EBIT
Yahoo
3 hours ago
- Business
- Yahoo
Return Trends At ARB (ASX:ARB) Aren't Appealing
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Ideally, a business will show two trends; firstly a growing return on capital employed (ROCE) and secondly, an increasing amount of capital employed. This shows us that it's a compounding machine, able to continually reinvest its earnings back into the business and generate higher returns. With that in mind, the ROCE of ARB (ASX:ARB) looks decent, right now, so lets see what the trend of returns can tell us. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. Return On Capital Employed (ROCE): What Is It? For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. To calculate this metric for ARB, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.18 = AU$144m ÷ (AU$881m - AU$101m) (Based on the trailing twelve months to December 2024). So, ARB has an ROCE of 18%. On its own, that's a standard return, however it's much better than the 11% generated by the Auto Components industry. See our latest analysis for ARB In the above chart we have measured ARB's prior ROCE against its prior performance, but the future is arguably more important. If you'd like to see what analysts are forecasting going forward, you should check out our free analyst report for ARB . How Are Returns Trending? While the current returns on capital are decent, they haven't changed much. The company has consistently earned 18% for the last five years, and the capital employed within the business has risen 94% in that time. Since 18% is a moderate ROCE though, it's good to see a business can continue to reinvest at these decent rates of return. Stable returns in this ballpark can be unexciting, but if they can be maintained over the long run, they often provide nice rewards to shareholders. Our Take On ARB's ROCE In the end, ARB has proven its ability to adequately reinvest capital at good rates of return. Therefore it's no surprise that shareholders have earned a respectable 89% return if they held over the last five years. So while the positive underlying trends may be accounted for by investors, we still think this stock is worth looking into further. While ARB doesn't shine too bright in this respect, it's still worth seeing if the company is trading at attractive prices. You can find that out with our on our platform. If you want to search for solid companies with great earnings, check out this free list of companies with good balance sheets and impressive returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
16 hours ago
- Business
- Yahoo
Berentzen-Gruppe issues profit warning on weak consumer demand
Berentzen-Gruppe has cut its forecasts for annual revenue and operating profit, pointing to continued low consumer confidence. Ahead of the planned publication of the Germany-based distiller and soft-drinks maker's half-year results next month, the Pushkin vodka set out new projections for revenue and operating profit. The business now expects its revenues to be between €172m ($201m) and €178m in 2025, down from its previous forecast of €180-190m. In 2024, the group recorded revenue of €181.9m. Berentzen-Gruppe is projecting consolidated operating profit to range between €8m and €9.5m this year. In 2024, it generated EBIT of €10.6m and had been forecasting between €10m and €12m for 2025. 'Development in the first half of 2025 thus fell short of our expectations, which is primarily attributable to very challenging market conditions in the spirits segment,' Berentzen-Gruppe CEO Oliver Schwegmann said. 'When we set our forecast at the beginning of the year, we still assumed that the very poor consumer sentiment that manifested itself in 2024 would brighten significantly again in 2025. Instead, this trend has continued in 2025 and has even intensified across the entire alcoholic beverages market.' Schwegmann said all promotions with discount retailers for the company's Berentzen-branded liqueurs were cancelled in the first half. 'This was one of the main reasons why the second quarter was weak for our branded spirits,' he added. However, Schwegmann pointed to the 13.2% increase in revenues from the company's Mio Mio soft-drinks brand, which he described as 'finally back on its dynamic growth path'. He added: 'We achieved double-digit revenue growth with our premium and medium products from our private label spirits segment, which are strategically important, particularly for our international business. Overall, our strategic core areas therefore recorded an increase in revenues. This shows once again how important and right it was to position ourselves broadly as a group of companies. 'Despite this market environment, we expect the marketing initiatives outlined above to take effect later in the year, enabling us to report revenues and earnings figures for the second half of the year at the strong level of the previous year.' Last week, Berentzen-Gruppe announced a deal to source Bourbon from Whiskey House of Kentucky. Berentzen-Gruppe, which supplies private-label Bourbon, said the tie-up has started, with the first whiskey barrels filled. A spokesperson for Berentzen-Gruppe told Just Drinks: 'We are one of the largest Bourbon suppliers in Europe for private-label business. 'Particularly in view of the long storage times, we need firm, long-term contracts that ensure we will have sufficient quantities available in the coming years.' "Berentzen-Gruppe issues profit warning on weak consumer demand" was originally created and published by Just Drinks, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
17 hours ago
- Business
- Yahoo
Lindt sweetens sales forecast after 'strong' H1
Swiss chocolatier Lindt & Sprüngli has raised its sales forecast for 2025 after 'strong' growth in the first half of 2025. The Lindor maker now projects its sales will rise by 9-11% on an organic basis this year, up from its previous forecast of 7–9%. In a statement issued today (22 July), Lindt & Sprüngli said its positive outlook is underpinned by "continued consumer loyalty and the ongoing trend towards premiumisation". Lindt & Sprüngli is forecasting an increase in EBIT margin at the "lower end of" its medium-term annual target of growth of 20 to 40 basis points for 2025. The first half of the year saw Lindt & Sprüngli grow its organic sales growth by 11.2%, amounting to total sales of Sfr2.35bn ($2.94bn). The increase was driven by all regions, the company said, with Europe leading the way with a "very strong" organic sales growth of 17.7%. All European subsidiaries reported "double-digit growth", with the 'strongest' performances observed in the Nordics, Benelux, Central Eastern Europe, France and Austria. In North America, Lindt & Sprüngli's organic sales grew by 3.6% by the business said the result fell short of expectations as a result of 'weak consumer sentiment'. Conversely, the Rest of the World division saw sales rise 7.8%, with Japan, Brazil, South Africa, and China recording "double-digit growth". EBIT fell 11.3% to Sfr259.2m. In the first half of 2024, Lindt & Sprüngli generated EBIT of Sfr292.3m, which included a one-off effect from a resolved legal dispute. Net income declined 13.3%, settling at Sfr188.9m. The company reported a negative free cash flow of Sfr79.7m in the first half of the year, compared with a positive Sfr70.4m in the corresponding period of 2024, influenced by the "higher valuation of inventories because of the higher cocoa costs". In response to the escalating cocoa prices, Lindt & Sprüngli announced in March its intention to implement double-digit price increases in 2025, following a 6.3% hike initiated last year. CEO Dr Adalbert Lechner, while presenting Lindt's 2024 financial results on 4 March, refrained from specifying the exact figure for the impending cocoa-linked price increases but acknowledged that the rise was "significant". "Lindt sweetens sales forecast after 'strong' H1" was originally created and published by Just Food, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
21 hours ago
- Business
- Reuters
Poste Italiane lifts profit outlook after Q2 earnings beat forecast
MILAN, July 22 (Reuters) - Poste Italiane ( opens new tab on Tuesday raised its profit outlook for the current year after it reported better-than-expected second quarter operating profit, boosted by its financial services division. Adjusted earnings before interest and taxes (EBIT) rose by 10.4% to 864 million euros ($1.01 billion), comfortably above a company-compiled consensus of 790 million euros. Poste said it now targets an adjusted operating profit of 3.2. billion euros this year, up from 3.1 billion euros it had previously guided for. ($1 = 0.8549 euros)
Yahoo
a day ago
- Business
- Yahoo
Returns On Capital Signal Difficult Times Ahead For ComfortDelGro (SGX:C52)
What financial metrics can indicate to us that a company is maturing or even in decline? When we see a declining return on capital employed (ROCE) in conjunction with a declining base of capital employed, that's often how a mature business shows signs of aging. Trends like this ultimately mean the business is reducing its investments and also earning less on what it has invested. And from a first read, things don't look too good at ComfortDelGro (SGX:C52), so let's see why. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. Return On Capital Employed (ROCE): What Is It? Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. To calculate this metric for ComfortDelGro, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.081 = S$318m ÷ (S$5.7b - S$1.8b) (Based on the trailing twelve months to December 2024). So, ComfortDelGro has an ROCE of 8.1%. On its own, that's a low figure but it's around the 6.8% average generated by the Transportation industry. See our latest analysis for ComfortDelGro In the above chart we have measured ComfortDelGro's prior ROCE against its prior performance, but the future is arguably more important. If you're interested, you can view the analysts predictions in our free analyst report for ComfortDelGro . What The Trend Of ROCE Can Tell Us There is reason to be cautious about ComfortDelGro, given the returns are trending downwards. To be more specific, the ROCE was 10% five years ago, but since then it has dropped noticeably. And on the capital employed front, the business is utilizing roughly the same amount of capital as it was back then. Since returns are falling and the business has the same amount of assets employed, this can suggest it's a mature business that hasn't had much growth in the last five years. If these trends continue, we wouldn't expect ComfortDelGro to turn into a multi-bagger. While on the subject, we noticed that the ratio of current liabilities to total assets has risen to 31%, which has impacted the ROCE. Without this increase, it's likely that ROCE would be even lower than 8.1%. While the ratio isn't currently too high, it's worth keeping an eye on this because if it gets particularly high, the business could then face some new elements of risk. The Bottom Line In the end, the trend of lower returns on the same amount of capital isn't typically an indication that we're looking at a growth stock. Despite the concerning underlying trends, the stock has actually gained 29% over the last five years, so it might be that the investors are expecting the trends to reverse. Either way, we aren't huge fans of the current trends and so with that we think you might find better investments elsewhere. On a final note, we've found 1 warning sign for ComfortDelGro that we think you should be aware of. If you want to search for solid companies with great earnings, check out this free list of companies with good balance sheets and impressive returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
