Fromageries Bel, FBEL,

8/10/2019 Fromageries Bel, FBEL,

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GROUP BEL

GROUP BEL HEC PARIS 1

Company name : Fromageries BelExchange : ParisTicker symbol : FBEL.PAIndus ry : DairyCurren price : 300 (as of Jan 9,2014Targe price : 330 (10! "#si$e!arke Cap : 2.03 Billion"# $eek Range : 2%& ' 314

#%&'( #%&)E #%Re*enuegro+ h ,-.

2. ! 2.0! 2.0!

Gross margin,-.

33.1! 33.1! 33.1!

EBIT/(margin ,-.

12.1! 10.%! 10.%

EBIT( margin,-.

9.9! ).3! ).3!

EBIT margin

,-.

9.3! . ! .

(d0us edpro1i margin,-.

%.0! &.3! &.

*o"r+e: Fa+ se , -ro"# Es ima es

* o+ /a ing:LD

I 2 I T I ( T I O 2

R E P O R T

e ini ia e +o erage of -ro"# Bel a 3old i 5 aprice arge o1 ''% 5i+5 im#lies E67EB8 DA a

.& (2014E an$ E67EB8 a 10.4 (2014E . e fo+"son 5ree ey in es men $e;a es in 5is re#or :China Growth

"l i#le glo;al mar e ing

ini ia i es +on in"e o #ro i$e 5e +om#any a i$ee+onomi+ moa .

T(BLE O4 CO2TE2T5

1. B"siness er ie2. -ro"# * ra egy3. ?ey B"siness /is s4. Finan+ial ig5lig5 s&.


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Business O*er*ie+Fromageries Bel *A, 5ea$@"ar ere$ in Paris,Fran+e, is a family'o ne$ +om#any 5a #ro$"+esan$ sells fo"r +a egories of +5eese (#resse$,#ro+esse$, fres5 an$ s#rea$a;le an$ is 5e glo;allea$er in +5eese #or ions. 8 o ns more 5an 2&in erna ional an$ lo+al ;ran$s, in+l"$ing & +ore;ran$s, is #resen in 120 +o"n ries an$ o ns 30s";si$iaries an$ 2 #ro$"+ ion si es, i 5 10 of

5em lo+a e$ in Fran+e. 5ro"g5 i s s";si$iary, BelFoo$ser i+e, 5e +om#any is #resen in 5e+a ering se+ or an$ ser es fas 'foo$ +5ains,5os#i als, res a"ran s, en$ing ma+5ine o#era ors,

rain s a ions an$ air#or s. 8n a$$i ion o 5a , Bel

also sells $airy #ro eins o foo$man"fa+ "rers (es#e+ially i+e +ream "n$er5e olli;el ;ran$. 5e +om#any a ra+ e$

400 million +ons"mers an$ 5o#es o a+5ie e3 ;illion in sales ;y 201&.

BelCs re ail s ra egy is es a;lis5e$ ei 5er a5e na ional le el, 5ro"g5 s";si$iaries, or a5e in erna ional le el, i 5 +on ra+ s

nego ia e$ a 5e gro"# le el. >oreo er, Bel"ses a ne or of 5olesalers s#e+iali e$ infoo$ ser i+e. n 5e *"##ly si$e, 5e+om#any 5as 5e follo ing #"r+5asingnee$s: +ore ra ma erials (mil , mil#o $er, ;" er , #a+ aging ma erials an$energy. Bel 5as +on ra+ s i 5 s"##liers ofmil in Fran+e, e 5erlan$s, Polan$,

*lo a ia, raine an$ *. >oreo er, i +on rols si $airies in Fran+e an$ 22 in o 5er +o"n ries.5e Fie e 7Bel Family 5ol$s 3.&! of 5e Fromageries Bel s5ares $ire+ ly an$ &4! 5ro"g5 i s

)0! 5ol$ing in ni;el *A.

Brand Por 1olio" Core Brands

5e La"g5ing are$so"s, >er s, Pri+eCs, *amos,


*o"r+e:


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*me ani o, *yl#5i$e, *yro rem, *yr os, erra os ra, isPri$e8n erna ional Bran$s

A#eri+";e, Ba;y;el, Bon;el,


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in+rease$ #ri+es of i s #ro$"+ s. >oreo er, 5ere is no finan+ial 5e$ging mar e in 5e $airyin$"s ry, e +e# in 5e * (see a##en$i for +ommo$i y #ri+e +5ar .Compe i ion : Bel fa+es in ense +om#e i ion from ma=or in erna ional foo$ #layers, as ell aslo+al #ro$"+ers. 8n a$$i ion o 5is, 5ere is in+rease$ +om#e i ion +oming from re ail +5ains 5a5a e $e elo#e$ 5o"se ;ran$s (also no n as #ri a e la;el7+on rol la;el in or 5 Ameri+a .

/egar$less, +ons"mers rea+ o #ri+ing aggressi ely, li e any o 5er #ro$"+ in 5e foo$ in$"s ry#ro$"+ .Economic clima e : BelCs sales are li ely o ;e infl"en+e$ ;y 5e e+onomi+ a+ i i y in 5emar e s 5ere i o#era es. i 5 slo e$ e+onomi+ gro 5 in E"ro#e an$ "n+er ain y regar$inge+onomi+ re+o ery, +a" ion nee$s o ;e a en 5en #re$i+ ing 5e le el of sales in 5is region,

5i+5 +"rren ly a++o"n s for 40! of BelCs re en"es.Exchange ra e risk : D"e o 5e geogra#5i+al s#rea$ of i s o#era ions, Bel is e #ose$ o FHris , sin+e i re+ei es re en"es an$ fa+es e #enses in m"l i#le +"rren+ies a#ar from 5e e"ro.

5e reas"ry De#ar men of Bel im#lemen s a +en ral +"rren+y 5e$ge s ra egy "sing $eri a i eins r"men s i 5 a ime 5ori on of 1) mon 5s. o e er, ;e+a"se of 5e 5ig5 ola ili y na "re ofsome +"rren+ies 5ere Bel o#era es, 5ere is a ma erial $o nsi$e ris $"e o 5is.Regula ory risk : D"e o 5e geogra#5i+al rea+5 of i s a+ i i ies, as ell as 5e na "re of i s;"siness, Bel fa+es reg"la ory 5rea s. 5ese in+l"$e 5ygiene s an$ar$s, en ironmen al +on rolsan$ +om#e i ion la s.


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as a;le o a$="s *-IA le els in or$er o a oi$ ne margin +om#ression.

10.4% 9.7%7.8%

12.1% 11.8%10.3%

11.9% 11.7%

EBITDA-margin

5e EB8 DA margin ren$ follo s 5a of o#era ing margin an$ 5as ;een o er 5e 10! le el for5e #as fe years. e ;elie e 5a 5ese le els are 5eal 5y ;y in$"s ry s an$ar$s an$ ill

+on in"e o ;e o;ser e$ o er 5e long erm.

5e /e "rn on 8n es e$


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Compe i i*e O*er*ie+5e Bel -ro"# fa+es 5ree main y#es of +om#e i ors: ma=or in erna ional foo$ gro"#s 5a

#ro$"+e +5eese among o 5er y#es of #ro$"+ s (?raf , ma=or in erna ional $airy #ro$"+ers(Bongrain, o+5lan$, La+ alis, Frieslan$ Es as ell as large +om#anies,in+l"$ing 5e #a+ aging an$ ingre$ien s in$"s ry, all +on ri;" e o inno a ion. 8n or 5' es ernE"ro#e, large firms $omina e 5e $airy in$"s ry. 5is 5as ;een a res"l of #re io"s a es of+onsoli$a ion. Fran+e an$ -ermany, 5o e er, 5a e a small n"m;er of large firms an$ @"i e alarge n"m;er of me$i"m an$ small firms. 5e E $airy in$"s ry +an ;e +5ara+ eri e$ as an

inno a i e an$ a glo;al #layer, ;" i 5 a losing mar e s5are. BelCs +om#e i i e #osi ion is ="s;elo a erage, mainly $"e o 5e loss in orl$ mar e s5are. 8n fa+ , a+ross mos of 5e ey#layers in 5e E mar e gro 5 5as s agna e$. A++or$ing o E"romoni or, glo;al


7/22Overall China CheeseMarket Growth

ro!esse"

Cheese#

others$24.5%

ar"CheeseC&G'$25.8%

(o)tCheeseC&G'$27.6%

5e orl$Cs o# 10 $airy gian s +a# "re 24! of 5e mar e in 2014, "# from 1 ! in 2009. 8ne is ing an$ ma "re mar e s s"+5 as 5e *, Fran+e an$ 8 aly, m"l ina ionals are K;"ying ininno a ion 5ro"g5 a+@"iring smaller, more inno a i e firms in ni+5e mar e s. >ore >IA a+ i i yis e #e+ e$ o o++"r i 5 m"l ina ionals ;"ying more ni+5e organi+ or la+ ose'free ;ran$s inor$er o i$en 5eir #or folio an$ a# in o smaller ;" fas er gro ing mar e s. Ano 5er 5eal 5

foo$ +a egory, 5i+5 is ;eing eye$ "# ;y m"l ina ionals, is non'$airy mil al erna i es.i 5 #er +a#i a $airy +ons"m# ion in ma "re mar e s $ro##ing, +om#anies are see ing for

gro 5 in emerging mar e s 5a 5a e a far lo er le el of +ons"m# ion ;" , +on ersely, aregro ing.

In*es men 5ummaryI27E5T!E2T T 3E5I5 ,&.8 ! O(T 9:(RELL(6al"e'a$$e$ inno a ion in $airy is e ol ing an$ ;e+oming of grea er im#or an+e in a 5ig5ly+om#e i i e an$, a;o e all, ma "re mar e s#a+e, 5ere +ons"m# ion is $e+lining. 5e e ol" ionof $airy is $e#en$en on 5e +ommo$i i a ion of 5e +a egory an$ $emons ra es 5e nee$ for

al"e 5ere #ri a e la;el s5are is 5ig5.Pa+ ' y#es 5a e ;een a s"++essf"l mar e ing ool for ;ran$s sin+e imes immemorial. Bel 5as;een a #ioneer in 5is fiel$ i 5 5e early la"n+5 of 5e i+oni+ KLa 6a+5e M"i /i , Ba;y;el an$?iri #ro$"+ s.Pro$"+ s range$ from 5e single ser e Ksala$ +5eese la"n+5e$ in * i erlan$ o 5e iramis"'

o'go ;ar la"n+5e$ in A"s ria. -i en iramis" is y#i+ally seen as a $esser ea en i 5 a s#oon or for a 5e $inner a;le, 5e "ni@"eness of 5is #ro$"+ is 5a 5e #a+ aging allo s i o ;e ea enas a sna+ on' 5e'go, i 5o" 5e "se of +" lery.8nno a ions 5a 5a e +a"g5 5e eye re+en ly are #es o an$ oma o -o"$a, K iramis" on' 5e'goas ell as K;" er i 5 sea ee$ +5eese o name a fe . 8f Bel +an +on in"e o re ol" ioni e 5e+5eese in$"s ry ;y la"n+5ing ne #ro$"+ s 5a es#e+ially $iffer in erms of #a+ aging, 5ere ill

;e a +a alys for f" "re gro 5.

I27E5T!E2T T 3E5I5 ,#.8 2 UTRITIO2(LL;2(UG3T; TRE2/

8n ma "re $airy regions s"+5 as or 5 Ameri+a, es ern E"ro#e an$ A"s ralasia,

5ere is a s rong nee$ for al"e +rea ion in$airy in or$er o +o"n era+ $e+lining #er +a#i a +ons"m# ion of $airy o erall.


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*ite+si,e !-.es

/hese 0a!ks )a!ilitate !ons-10tion a1on2Chinese sho00ers who ten" to .e -ns-re a.o-t the3-antit4 o) !heese to -se in a servin2

/elevision*el China s0onsore" a5 67i-ni- /o-r o) 8ran!e95that showe" a )a1il4 tri0 to 8ran!e an" e1.e""e"intro"-!tion o) :a ;a!he 3-i 'it a.o-t ori2in an"0ro"-!tion

5i+ layer of +5o+ola e. 8n fa+ , +5ille$ sna+ s, "n$er 5i+5 6il i o"l$ ;e +lassifie$, 5as seen aan"fa+ "rers ma$e no a;le effor s o ;oos +ons"mer a areness of +5eese, in+l"$ing 5e

#"r#or e$ 5eal 5 ;enefi s s"+5 as 5eir in+l"sion of ario"s i amins, minerals, amino a+i$s an$omega'3 fa y a+i$s, 5i+5 all 5el# o s"##or 5eal 5y ;ones, ;rain an$ 5ear

*of +5eese is more #o#"lar 5an 5ar$ +5eese in


9/22

e ;elie e 5a Bel -ro"#Cs a;ili y o #ro=e+ an image of ;eing Fren+5 is 5a gi es i ane+onomi+ moa or s"s aina;le +om#e i i e a$ an age s. o 5er ri als 5o #rimarily fo+"s on 5e5eal 5 ;enefi s of 5e #ro$"+ .

E"romoni or es ima es 5a +5eese is a 5ig5ly im#or '$e#en$en +a egory in ore $e ails +an ;e fo"n$ in 5e a##en$i , an$o;ser e$ 5a on E67EB8 DA(2013A ;asis, FBEL ra$es a %.24 , ;elo 5e me$ian of 9.3 .

e s"rmise 5a on a ra$ing +om#s ;asis, FBEL is no ra$ing more aggressi e 5an i Cs #eers.

e o;ser e a similar s ory on P7E ;asis.

C mpan# $ame

Bongrain*a#" oEmmi-lan;iaDairy


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/iscoun ed Cash1lo+ (nalysisi 5 5e ass"m# ions asso+ia e$ i 5 +os of

+a#i al(as seen in a;le on rig5 , an$ an$#re#e "i y gro 5 ra e of 0.&!, e arri e a aim#lie$ s5are #ri+e of 330. 5is im#lies an"#si$e of 10!(as of Jan 9,2014 . e ;elie e

5a 5is #ri+e arge is 5ig5er 5an 5e +"rrenmar e #ri+e, ;" $oes no ="s ify a B Ore+ommen$a ion a 5is #oin . E en 5o"g5 eo;ser e inno a ion an$ gro 5 in a erial ar e ris #remi"m (.0!Be a e@"i y .)8lli@"i$i y #remi"m 2.0!C 4t 5 e6!it# 2/0%7Pre' a +os of $e; 3.%!a ra e 3).0!

A5ter-ta 8 4t 5 de9t %/(7-earing .0)0:ACC 2/&37

218

33241423

91 10

72

+

50

100

150

200

250

300

350

400

450

*ear latsales


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$ha +ould make us change oBU;i$$le Eas , /"ssiaea e+onomi+ gro 5 in E"ro#e

Finan+ial * a emen s:



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GROUP BEL HEC PARIS 1&


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GROUP BEL HEC PARIS 1%


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GROUP BEL HEC PARIS 1)


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5CE2(RIO (2(L;5I5 (55U!PTIO25



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Fromageries Bel, FBEL,