Mersen: highly regarded publication


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( — Mersen climbed more than 3% to 32.40 euros on Thursday, while the group announced consolidated sales of 255 million euros for the first quarter of 2022, an increase of more than 16% compared to the first quarter of 2021, after allowing for favorable exchange rate effects , mainly the US dollar and RMB. Price increases contributed about 3% to growth this quarter.

Mersen is confident of achieving its annual targets, thanks in particular to the buoyant renewable energy and semiconductor markets. For 2022, Mersen is targeting organic growth of 3% to 6% with a current operating margin of around 10%, factoring in the impact of higher depreciation costs, ramping up production at the Columbia site and strengthening teams dedicated to electric vehicles.
These forecasts do not take into account indirect effects related to the situation in Ukraine, which are currently difficult to assess. In addition, the Covid-related situation in China had no impact on activity in the first quarter. Locations in the Shanghai region have been throttled since early April, but the group doesn’t anticipate a negative impact for the year.

“With a price effect of 3% over the quarter, Mersen is following its plan to pass a large part of the inflation on to its customers, which gives a little more credibility to the full-year sales scenario and especially the margin,” comments Portzamparc, who emphasizes that notebook orders are down remains high (5 months of sales) and that the greatest uncertainty is in the process industry (30% of sales), which is more volatile and correlated with GDP evolution. “Against this background, we confirm our scenario for 2022 (sales +4.5% organic / MOC 10.1%). Our target price was revised downwards from EUR 38 to EUR 34.5 due to the rise in interest rates. (DCF – 35 euros) and the decline of the comparables (SOTP – 34.1 euros)”, concludes the analyst.


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