Motor Sich boosts EBITDA 30% yoy in 2011

Motor Sich (MSICH UK) increased EBITDA 30% yoy to USD 285.5 mln in 2011, according to an annual report presented at an AGM yesterday. EBITDA was 5% above Bloomberg consensus and EBITDA margin (39.4%) was 3.8 pp above consensus. Revenues grew 16% yoy to USD 724.0 mln in 2011. Profit before tax rose 33% yoy to USD 257.1 mln, while the bottom line increased by a moderate 9% yoy to USD 168.0 mln. Company shareholders voted to distribute 3.6% (USD 6.2 mln) of the company’s net income for 2011 as dividends, which implies DPS of USD 3.1 and dividend yield of 1.1%.

Roman Dmytrenko: We note that the company’s revenue for 2011 was only 3% below its announced order book for the year, therefore we see a very high chance that Motor Sich will reach its announced sales target of USD 800 mln in 2012 (see our news of January 23). The 2012 outlook, therefore, represents a 10% growth in sales in 2012. We believe the stock market has yet to reward the company’s strong 2011 operating results and positive outlook for this year, backed by the filled order book; the stock is trading at an attractive 2011 EV/EBITDA of 2.1x.