Essilor: Q2 LFL growth misses expectations whilst profitability is a touch above
BUY, Fair Value EUR96 (+13%)
This morning Essilor unveiled mixed H1 13 results: H1 sales came in at EUR2,576m, a touch below consensus of EUR2,604m, up 1.8% reported and 1.2% LFL. The deviation comes from a softer rebound in the LFL in Q2, which only amounted 2.4% (Q1: flat) vs. 4.5% expected by investors.Two regions are notably weaker than expected: North America and AMEA. The H1 contribution margin reached 18.3% (+40bp vs. H1 12) and is bit above CS of 18.1%. The analysts’ meeting today at 10am (CET) will have two hot topics: i) FY13 sales guidance: the 5% LFL objective should probably be abandoned by Essilor’s management (“combined” growth of 7% is maintained) and ii) more colour on Transitions.
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