Sopra Group: Q3 13 sales in line with consensus, FY13 guidance globally reiterated
BUY, Fair Value EUR75 (+13%)
Yesterday evening Sopra reported Q3 13 sales 2% above our forecasts and in line with the consensus average, with management reiterating confidence of delivering 2-5% lfl growth for FY13. However, the op. margin is likely to be at the low-end of the 7.3-7.7% guidance range due to a lower-than-expected deal transformation in Sopra Banking Software, and net debt is likely to reach the high-end of the EUR150-170m guidance range due to payment delays in the Public sector. The good news is that the integration of HR Access is ahead of schedule, and the surprise reduction of its 2014 breakeven point makes us increase our adj. EPS ests. by 2% for 2014 and 1% for 2015 (vs. -2% for 2013).
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