Original-Research: Cantourage Group SE (von NuWays AG): Buy

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Original-Research: Cantourage Group SE - from NuWays AG

27.01.2025 / 09:00 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQS

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Classification of NuWays AG to Cantourage Group SE

Company Name: Cantourage Group SE

ISIN: DE000A3DSV01

Reason for the research: Update

Recommendation: Buy

from: 27.01.2025

Target price: EUR 12.50

Target price on sight of: 12 months

Last rating change:

Analyst: Christian Sandherr

FY24 with explosive growth // new high(t)s in sight; PT Up

Topic: Following the regulatory changes in April, sales growth has been

stellar throughout the remainder of FY24. Thanks to various de-bottlenecking

measures and unbroken demand, Cantourage looks poised for new operational

highs.

Based on preliminary figures, Cantourage ended FY24 with EUR 51.4m sales, a

118% yoy increase, beating the guidance that the company raised to EUR 46-50m

at the beginning of December. The fourth quarter alone accounted for EUR

21.4m, 185% above previous year's level of EUR 7.5 and only slightly less than

to the whole year 2023. With EUR 8.5m sales, December beat the previous

monthly high of EUR 7.5m. The strong sequential increases throughout the year

were carried by successful de-bottlenecking efforts at processing sites and

an increase of supplier depth.

Importantly, with a scaling top-line, we also expect Cantourage to have

reached EBITDA profitability for the first time; eNuW: 7.5% margin. The

expected gross margin of above 37% underpins the margin potential with

growing sales volumes.

What to expect from FY25: In light of the favorable market dynamics, notably

increased processing capacities (>14t annually), the Polish market entry at

the end of last year and the relaunch of its own telemedicine platform,

telecan°, strong growth is out of the question. We currently model a 67% yoy

increase to roughly EUR 86m despite an FY run rate of slightly more than EUR

100m, based on the December sales figure to account for weaker summer months

and a margin of safety. With this, the EBITDA margin is seen to further

increase to 10%, in our view.

Threats from political uncertainties limited. As more conservative parties

are likely to gain power in the upcoming election in Germany (end of Feb.),

which have historically opposed a broader cannabis legalization, we see the

potential of re-regulation on the recreational side, i.e. cannabis clubs and

growing own plants. Importantly, Cantourage is only active in the medical

space, we hence regard the risks to its business model as limited.

Taking into account the strong growth during recent years and the prospects

stemming from growing patient numbers at its 'home-turf' Germany and the

ongoing regional expansion, the current valuation seems undemanding at 6.3x

EV/EBITDA FY25e. BUY with a new EUR 12.50 PT (old: EUR 12) based on DCF.

You can download the research here: http://www.more-ir.de/d/31663.pdf

For additional information visit our website:

https://www.nuways-ag.com/research-feed

Contact for questions:

NuWays AG - Equity Research

Web: www.nuways-ag.com

Email: research@nuways-ag.com

LinkedIn: https://www.linkedin.com/company/nuwaysag

Adresse: Mittelweg 16-17, 20148 Hamburg, Germany

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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss

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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben

analysierten Unternehmen befinden sich in der vollständigen Analyse.

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2074779 27.01.2025 CET/CEST

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