Luxottica: Q1 results fairly in line but the best is yet to come
BUY, Fair Value EUR41 vs. EUR38 (0%)
Yesterday evening Luxottica unveiled Q1 13 results. Q1 sales came in at EUR1,864m (+4.2% as reported and +5.6% CER) and were globally in line with consensus of EUR1,872m which was aware of the challenging comparison base (Q1 12: +11.1% CER). Q1 EBIT was a touch above market expectations (EUR275m vs. EUR271m anticipated), implying a 14.7% EBIT margin (+40bp vs. Q1 12 adjusted EBIT margin). Luxottica said that sales in April were accelerating almost everywhere. We factor in a bigger potential in margin improvement for both divisions which enables us to raise our FY13-15 margin assumptions by 3% on average. FV increased to EUR41 vs. EUR38.
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