Nucor earnings beat by $0.08, revenue fell short of estimates
Peugeot Invest reported a challenging Q1 2025, with a notable decline in Net Asset Value (NAV) by 22% to $1 billion. Despite these hurdles, the company maintained its dividend and showed resilience through strategic asset management. According to InvestingPro data, Peugeot Invest has maintained dividend payments for 10 consecutive years, with a current attractive yield of 4.18%. The stock saw a 1.16% decrease, reflecting investor concerns over the broader market and company-specific challenges.
Key Takeaways
- Peugeot Invest’s NAV decreased by 22%, impacting investor sentiment.
- The company completed $500 million in asset disposals, reinvesting $379 million.
- Consolidated net profit slightly increased to €146 million.
- Stellantis volumes fell by 12%, highlighting sector challenges.
- A new investment strategy is set to be presented in 2025.
Company Performance
Peugeot Invest faced a difficult quarter, with its NAV dropping significantly. The company’s gross asset value stood at $5.3 billion, with a strategic focus on diversified investments and holdings in Stellantis and Forvia. Despite the decline in NAV, the company reported a modest increase in consolidated net profit to €146 million, slightly above the previous year. InvestingPro analysis shows the company maintains strong financial health with a current ratio of 11.26, indicating excellent liquidity position. The stock currently trades at a price-to-book ratio of 0.34, suggesting potential value opportunity.
Financial Highlights
- Net Asset Value: $1 billion, down 22%
- Gross Asset Value: $5.3 billion
- Consolidated Net Profit: €146 million, slightly up from last year
- Dividend: Maintained despite NAV decline
Market Reaction
Peugeot Invest’s stock fell by 1.16% following the earnings report, closing at €77.8. This movement reflects investor concerns about the company’s performance and broader market volatility. Based on InvestingPro’s Fair Value analysis, the stock appears fairly valued at current levels. The stock remains closer to its 52-week low of €67.1, highlighting ongoing challenges in the investment and automotive sectors. InvestingPro subscribers have access to detailed valuation metrics and 6 additional ProTips that provide deeper insights into the company’s financial health and growth potential.
Outlook & Guidance
Looking ahead, Peugeot Invest plans to focus on capital deployment in 2025, with a new investment strategy aimed at restoring NAV growth. The company anticipates a more focused and conviction-driven investment approach, with continued support for Stellantis despite expected dividend reductions. InvestingPro data reveals the company’s strong dividend growth of 14.04% over the last twelve months, demonstrating commitment to shareholder returns despite market challenges. For comprehensive analysis of Peugeot Invest’s investment strategy and future prospects, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers.
Executive Commentary
CEO Jean Charles Drouin emphasized the company’s strategic priorities, stating, "My strategic priority as a CEO clearly is to formulate an investment strategy that will restore net asset value growth." He also highlighted the company’s commitment to value creation, saying, "We will be investing with conviction, with strong value creation plans."
Risks and Challenges
- Automotive market challenges with declining Stellantis volumes.
- Volatility in public equity markets affecting investment valuations.
- NAV discounts prevalent across the investment company sector.
- Potential impacts from a halved Stellantis dividend.
- Need for effective execution of the new investment strategy.
Peugeot Invest’s earnings call highlighted both the challenges and strategic adjustments the company is making to navigate a volatile market environment. The focus on strategic asset management and future investment plans aims to restore growth and investor confidence.
Full transcript - Peugeot Invest SA (PEUG) Q4 2024:
Moderator, Peugeot Invest: Ladies and gentlemen, welcome to the Peugeot Invest twenty twenty four Annual Results Webcast. Your host today are Jean Charles LeDroit, Chief Executive Officer of Peugeot Invest and Sebastien Caucard, Deputy CEO. Following the presentation, we will open the floor for a Q and A session. I’ll now hand over to the Peugeot Invest leadership team. Gentlemen, the floor is yours.
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Good morning, everybody. My name is Jean Charles Drouin. I’m the CEO of Peugeot Invest. With Sebastien Cocard, I’m delighted to be here to present our annual results. Before we dive into the details, Assuta will take a few moments to introduce myself.
I joined Peugeot Invest at the October 2024, after more than twenty years in the private equity industry. Before Peugeot Invest, I spent sixteen years at Ontario Teachers’ pension plan, which I guess you could describe as a sophisticated long term and disciplined institutional investor. And there, I was leading the private equity team in the Europe, Middle East and Africa region. As such, I worked on a large number of transactions in pretty much all the sectors in most European countries. I’ve also built up the team in London and I participated in the evolution of teacher strategy.
At Peugeot Havest, I see the same fundamental principles at work, a long term vision, a strong investment discipline and a deep commitment to supporting companies. Over the past few weeks, I’ve had the opportunity to meet some of you, and I look forward to continuing those discussions and engaging further with you all. With that, let’s dive into the details. So here are the results in a nutshell. We finished the year with a net asset value of billion.
This is down 22% from the previous year. Obviously, this is a very disappointing result, and Sebastien will break it down for us in a moment. But suffice to say, the drop in NAV is mainly driven by the steep drop in the STENOTIS share price last year. More positively, we have driven high level of activities in 2024 with more than billion of disposals. This led to an improved financial situation with a net debt of million, down million from previous year.
And finally, despite the drop in net asset value and a significant reduction expected in the upcoming Stellantis dividend, our board has approved a stable dividend for Peugeot Invest at per share. With that, I’ll hand over to Sebastien to drive us into the details of the results.
Sebastien Caucard, Deputy CEO, Peugeot Invest: Thank you, Jean Charles. Good morning, everyone. Let’s dive straight into our performance for the year. Our gross asset value stood at $5,300,000,000 structured as follows. 58% comes from our dividend diversified investment strategy, which is built on three underlying types of investments: direct shareholdings, investment funds and co investments.
42% comes from Peugeot eighteen ten, which consolidates our holdings in Stellantis and Forvia. After reaching an all time high close to billion in 2023, Our net asset value declined in ’twenty four. Specifically, the valuation of Stellantis has returned to its 2020 level. This evolution translates into a 25% decline in our share price and a 60% discount. At year end, the NAV per share stood at per share.
Looking at performance, the NAV posted a 22% decline, largely driven by the 40 drop in Stellantis share price, as illustrated on the slide. On the investment side, the activity remains stable. However, the strong dividend inflow, primarily from Stellantis, covered our expenses, taxes and the dividend payout to our shareholders, while also contributing to a reduction in net debt. Turning to Stellantis. Twenty twenty four has been a challenging year after Stellantis followed an exceptional record year in ’twenty three.
Volumes declined by 12%, largely due to lower production aimed at reducing inventories, which in turn impacted both margin and cash flows. As a result, revenue were down 17% and IOI margin decreased to 5.5%. That said, product momentum remains strong with 20 new models launched at the end of twenty twenty four and ten more planned for this year. It was also a year with significant shareholder returns with dividends and share buybacks playing a major role. Looking ahead to ’twenty five, the proposed dividend is set at half of the ’twenty four level.
Finally, an important transition is underway. A new CEO is expected to be appointed before the end of the first half of the year. The selection process is ongoing with the other committee where Robert Peugeot sits actively meeting with candidates. Looking now at our investments. Strategy, we saw positive momentum in shareholdings and investment funds, while co investments decreased.
Starting with the shareholdings. Overall, they delivered a solid 7% performance. Our private shareholdings led the way with a 17% valuation increase, reflecting a strong year where EBITDA grew by double digits. SPEAK share price started 24% well, but later faced challenges due to the political turbulence in France and finished the year up 6%. Meanwhile, we dispose SEB and part of Lizzie at valuation below their end of twenty three levels.
Our investment funds performed well, posting a 6% increase. 40% of the portfolio consists of twenty twenty four vintages, which are still largely valued at cost. On the co investment side, performance was disappointing. We sold two co investment at a higher valuation than the one we had in our books. We now have three listed co investments, each with different dynamics: Lineage, which went public last July, had a difficult start on the market, declining 30% since IPO.
We also received the GDP shares, which were hold by GAB until the second half. While its share price decreased by 32% in ’twenty four, it has rebounded 15% year to date. And IHS share price decreased by 35% in ’twenty four, but has since recovered strongly rebounding 42%. Additionally, we increased provision on some already provisioned co investments in real estate, China, where we have three co investments, and FoodTech. That said, most of the negative news should now be behind us.
Now let’s look at our cash flow dynamics. ’twenty four was an exceptional year in terms of dividend received, reaching record high. This reflects three years of strong profitability at ’70s coupled with high dividend payout. However, looking at ahead to ’twenty five, the dividend proposed to the AGM, as we said, is set to be cut by half. On the cost side, our cash SG and A remains stable, though we incurred some exceptional expenses related to government changes.
Turning to interest expenses, these remain very low, thanks to profitable hedging, debt reduction and strong returns on cash. After what has been a mixture, the board has decided to maintain the dividend at the same level of last year. Looking at the long term picture, our dividend has grown an annual rate of nearly 8% over the last eight years. This reflect the commitment to providing shareholders with regular level of dividend rather than exposing them to the volatility of the NAV linked to our listed assets. On the P and L side, 2024 consolidated net profit attributable to equity holders stands at 146,000,000, slightly above last year’s level.
While we benefited from higher level of dividend inflows, this was partially offset by increased provision on co investments. Let’s focus now on the asset rotation. So 2024 was another year of strong portfolio rotation. This marks the fourth consecutive year with around $500,000,000 of disposals, meaning that 63% of our 2020 investment valuation have rotated over the last four years. At the same time, we reinvested $379,000,000 into new opportunities that are positioned to create values in the next few years.
On the shareholding side, we completed $330,000,000 in disposals, capitalizing on high multiples. The Lizzie, Seb and TKO disposal were completed in the first half and have already been discussed and commented in our previous earning calls. Earlier this week, we sold half of our stake in SPIE. We have been a shareholder in SPIE for the last seven years. Over this period, the company has delivered consistent growth with EBIT increasing by 9% per year on average.
SPEAK continues to benefit from long term structural tailwinds, including the energy transition, shifts in the energy mix and digital transformation. While the share price up 30% this year, we saw an opportunity to crystallize part of our gains. This transaction generated a 1.8% cash multiple and a 9% IRR over the holding period. In the second half of ’twenty four, we built a new stake in Roberta, playing a key role in the restructuring of its capital and enabling the company to fully regain its independence. We supported this one hundred and seventy year old family owned group, founded by the Maubaire family, which is a global leader in flavors, flagons and natural ingredients, a market experiencing regular growth.
With the transaction that aligns the main shareholders, we also increased significantly the free float. Thanks to a well structured deal, we were able to invest at an attractive price. We now hold 7.6% of the company and will be joining the board at the next AGM. Looking ahead, we are committed to supporting the management team in its effort to increase Roberta’s visibility in the financial markets. The Capital Market Day plan for May is a step in the right direction.
In our co investment portfolio, we exited two co investments, AmaWaterways and Transact, with a two time returns on initial investments, while also committing to two new co investments in software companies with significant exposure to The U. S. Markets. First, in TradingView, a social media network, analysis platform and mobile app designed for traders and investors. And then Springbrook, a U.
S. Based provider in ERP software and payment solutions tailored for small and mid sized municipalities. We continue to expand our private equity funds portfolio, which is now valued close to 1,000,000,000. In 2024, we made 11 new commitments to selling million spread across the buyouts, the tech and the real estate funds. On the cash flow side, our funds called 154,000,000 in capital and distributed 108,000,000 over the year.
Now turning to our credit profile. So we reduced net debt by million, reinforcing our financial strength. Despite the NAV decline, our loan to value ratio is lower than last year with a prudent 11% level. We maintain a strong liquidity position of 1,000,000,000, giving us the flexibility to seize new investment opportunities. Finally, we have a million pP maturity in July, which will be partly refinanced through a new 100,000,000 USPP with a seven year maturity at 4.62%.
Georges Charles, I’ll now hand it over to conclude the presentation.
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Okay. Thank you. Before we conclude the presentation, I wanted to mention a number of events that took place since the year end. And really, I want to highlight three points. Number one, we continue to work hard with our investments to execute on the value creation plans.
This is the case, obviously, at Stellantis, where, like Sebastien said, we are actively participating in the CEO search. But this will also be the case with Roberta when we joined the board in May. Number two, we have started to reposition the portfolio. This was illustrated by the self of half our stake in SPEAK, where we took advantage of good market condition, and we’re looking at the rest of the portfolio, including our fund investments. And number three, we continuously seek to improve our own business, and we always strive for better governance.
So to conclude, why do I remain positive about the potential of Peugeot Invest? We have a number of assets like our name, our heritage, our flexible capital and a strong liquidity position. I also found a very engaged and professional team when I joined here a few months ago. What that means is that we are in good shape now to reposition our portfolio on new investments, and we will do so by focusing on performance, by building on our strengths, having learned from the past, improving cross fertilization between our programs and especially between the funds and the direct investments and managing our portfolio more actively like you’ve seen us do recently. So on this, I want to thank you for your attention, and we will now open for questions.
You. Uh-huh. Uh-huh. Uh-huh. Okay.
Uh-huh.
Moderator, Peugeot Invest: So we have a first question, Mr. Jean Charles Lejuan. You stepped into the role of CEO a few months ago. What key initiative have you implemented so far? How do they align with your strategic vision for Peugeot Invest?
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Thank you, Leslie. So look, immediately coming in, my first priority was to get to know the team, the board, familiarize myself with the portfolio and also change a few internal processes and system when required. With Sebastien, we’ve also spent quite a lot of time actually trying to understand what has worked well for us and what has worked not so well. And we will incorporate that into our thinking when we look at the investment strategy. So now my strategic priority as a CEO clearly is to formulate an investment strategy that will restore net asset value growth.
So we’re working on that at the moment. We will present it to our board in the coming weeks for validation. But what I can tell you is that this is a strategy which will be more focused, more meaningful where we will be investing with conviction, with strong value creation plans, and we will be much more proactive in outsourcing and active in our portfolio management. Now obviously, repositioning the portfolio will take time. We’ve started to do that.
We talked about it during the presentation, obviously, SP and some of the other things we’re looking at. And we’re starting to filling up the pipeline as well for new capital deployment, and I expect 2025 to be a capital deployment year. So with that, maybe I’ll leave it to that, and I’m sure we will have more to discuss with you in the course of 2025.
Moderator, Peugeot Invest: Our next question. Peugeot Invest recently acquired a stake in Roberta. How does this investment align with your long term strategy?
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Yes. So I can take that one as well. So, look, Roberta Sebastian talked about Roberta, and I think he explained the potential that we saw in the business. I think what important and what is highlight for us is public equity remains a core part of investment strategy and will remain so. We see strong potential in public equities, and we think it has a benefit because we have a good track record in this asset class.
We have a strong reputation. And obviously, the public equity market allows you to find liquidity pretty much when you want it. And we saw that recently with SPEAK. What matters to me is when we go into an investment like this, I want us to have a clear and specific value creation plan for each investment. So for Roberta, for example, I think Sebastien touched on it.
What this involves is improving financial communication, improving visibility. And for example, the upcoming Capital Markets Day of Roberta is an example of that. So we will continue to work with the Roberta team. We’re joining the board in May. And again, we will be focusing on the core elements of value creation plan for that business.
Moderator, Peugeot Invest: Are you committed to keep the dividend at least stable also next year, even if Stellantis dividend is lower?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Well, I recall the dividend strategy for Peugeot Invest. Obviously, we will see next year what will be the situation and what Stellantis will do concerning its own dividend, and then we will decide what we will do. It’s probably too early to talk about 2026.
Moderator, Peugeot Invest: At the last AGM, the question on the Peugeot name license paid was a hot topic. Any update on that?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Yes. So the Peugeot brand is owned by Etables Mons Peugeot Freres. And any entity using the name is required to pay a legal licensing fee. So this ensured the proper brand management and recognition within the investment space. The fee also allows Peugeot Invest to leverage the heritage, credibility and reputation on the Peugeot name in its investment activity.
So the fee structure, we have a 3% on the dividend we receive of Peugeot Invest on the investment part, which is capital to 1,000,000. And Peugeot eighteen ten, the fee has been reduced significantly by 10 times as it was 1% before and now it’s 0.1%. So for $25,000,000 the total fee will be around $1,000,000 which is more than three times lower than what was paid last year. So obviously, it’s a subject that is behind us today.
Moderator, Peugeot Invest: You mentioned that in the context of the portfolio repositioning that you are looking at the funds. What do you mean by that? Do you want to increase or decrease investment here?
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Thank you for the question. Look, to be very clear, investment funds will remain a core part of the strategy. There’s no doubt about that. We’ve it’s been a very successful program for us. And I think the team here at Peugeot Havest has been very good at selling in funds that has delivered good alpha and good returns for the firm.
What I mean by looking at the funds portfolio is probably a couple of things. I want us to be a bit more intentional about our funds program. So roughly speaking, the size is probably going to remain more or less the same, but the number of relationships I expect to decrease. We probably have too many relationships today, and I expect the number of relationships to decrease. I also want us to be clear about the expectation and the road map when we tune to a fund, when we go into a fund, which is either to deliver strong returns for us, and we see a number of strong performers in our portfolio, or to deliver deal flow for us on the direct side, which again, we’ve seen historically, but we want to accelerate.
Moderator, Peugeot Invest: Do you plan to change the floating shareholding stake of the company? Yes. By making share buybacks, for example.
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Yes. Look, that’s a good question. I think for us, we’re looking at all the tools at our disposals. That includes share buybacks, that includes dividends. The only thing I would note is share buyback would reduce the could reduce the free float, which might not be the best thing to do in the context of our discount.
But this is always something we explore. At the moment though, there’s no immediate plan to do a share buyback.
Moderator, Peugeot Invest: Has investment in insect been written down to zero? Could you detail the shareholder maybe we’ll take this one after that?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Yes. The investment made in insect has been written to zero. Most of it, in fact, was done in ’twenty three, but the rest was done this year.
Moderator, Peugeot Invest: Could you please detail the shareholding in AHS, GDE, pets and lineage under listed asset rather than co investment? How large is your shareholding in this company?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Yes. So those three, coinvestment, in fact, are in the coinvestment total. It was, well, first private asset, but they weren’t listed. So now I can give you the valuation, of course. So the valuation of IHS is 14 the value of IHS is €14,000,000 end of last year.
Of GDP, it’s 26,000,000 and Lineage, it’s 73,000,000.
Moderator, Peugeot Invest: So what is the IRR target for co investment and shareholdings? Do you see SPE? Do you think SPE is unable to deliver such IRR in the coming years?
Sebastien Caucard, Deputy CEO, Peugeot Invest: So our targets for co investment and shareholding is to produce regular high single digit returns. That’s clearly what we are focusing on delivering. And this has been the case for SPE obviously. And as you see, we have kept half of our stake in SPE. So we believe that the company is well placed to continue delivering regular performance over the next few years.
Moderator, Peugeot Invest: Could you give us an update on the legal proceeding against the former administrators of Orpierre, including Peugeot Invest? And tell us if you have made any provision to cover this risk and what is your insurance cover against this litigation?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Okay. So as a former director of MAE, formerly named Orpierre, Peugeot Invest has received three summons before the Tribunal desactivites Economiques de Paris. The shareholders of or former shareholders of MAS who initiated these summons are seeking to hold the former directors of MAS liable for withholding information and communicating false information between 2016 and 2021. Peugeot Invest Asset believes that it has always exercised its mandate as a director of EMEA diligently and that there is no basis for these actions. So there has been no provision.
And so at this date, the timetable of the proceedings is not yet known.
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: And maybe to finish, so when I arrived, we did a review of the insurance policy, and I can confirm that we have appropriate DNO policy in place and that this would cover this matter.
Moderator, Peugeot Invest: Your discount to NAV remains significant. How do you plan to reduce it?
Jean Charles Drouin, Chief Executive Officer, Peugeot Invest: Thank you. Good question. So look, on our side, obviously, we’ve we can see that the discount to NAV has widened for us. It’s widened for the whole of the industry. We see that pretty much all investment companies in recent years have had a discount that’s widened.
And therefore, it must be a bit of a market trend, I guess. It’s a bit difficult for us to comment on the rationale for the discount. I think everybody would have their view and investors on this call might be actually better placed to comment on the reason for the discount. What is clear though is, clearly, we’re not satisfied with the level of the discount. We wanted to return to a more normal level, if I can call it that.
And I want to clarify also that all our stakeholders clearly align with that goal. And for management, this will be illustrated by the fact that Sebastian and I will have the reduction of the discount as a specific item of the performance criteria in our compensation package for 2025.
Moderator, Peugeot Invest: How do you perceive the decline in Stellantis dividend? And what impact is it having on your organization investment policy and own dividend policy?
Sebastien Caucard, Deputy CEO, Peugeot Invest: Okay. So as mentioned, we had three years of very high level of profitability on Centys and high dividend, and we improve regularly our own dividend. So our cash
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