Sopra Group: Updated FY13 targets including HR Access
BUY, Fair Value Under Review
This morning Sopra announced an update of its FY13 targets. Like-for-like revenue guidance is left unchanged (+2%/+5%) - as well as the net debt forecast as of end 2013 - but Sopra introduces an op. margin guidance excluding HR Access which is below our forecasts (above 8%, vs. BG est. of 9%). In addition, HR Access (est. EUR70m full-year revenues) will be loss-making and will remove an additional 0.3-0.7ppt to Sopra’s margin in 2013 before being at breakeven in 2014. Finally, FY15 targets (EUR1.5-2bn sales, op. margin 10%) are left unchanged. We consider such news will have a negative impact on the share price short-term.
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