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Original-Research: 123fahrschule SE - from NuWays AG

01.10.2024 / 09:01 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group AG.
The issuer is solely responsible for the content of this research. The
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.

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Classification of NuWays AG to 123fahrschule SE

     Company Name:                123fahrschule SE
     ISIN:                        DE000A2P4HL9

     Reason for the research:     Update
     Recommendation:              Kaufen
     from:                        01.10.2024
     Target price:                EUR 7.20
     Target price on sight of:    12 months
     Last rating change:
     Analyst:                     Philipp Sennewald

Final H1 in line with prelims; Capital increase to fuel growth

Topic: 123fahrschule released its final H1 '23 report, which was in line
with the preliminary figures communicated in July. Further, the company
announced the intention to resolve on another capital increase in order to
facilitate the strategic expansion of the branch network. Here are the key
takeaways:

H1 sales came in at EUR 11.1m (prelims: EUR 11.0m), implying a 5.9% yoy
increase. The main revenue driver again was the private customer segment,
which recorded sales of EUR 8.5m (eNuW: EUR 8.4m), up 6% yoy, on the base of
increased registrations (+4.5%) as well as price increases. Notably, the
driving instructor training segment grew sales by 22.6% to EUR 1.6m (eNuW: EUR
1.5m). On the other side, sales in the professional driver education segment
showed a 14.6% yoy decline to EUR 1.0m (eNuW: EUR 1.3m).

Despite this, H1 EBITDA saw a slight decline, coming in at EUR 0.1m (vs EUR 0.2m
in H1 '23), which was however mainly due to a change in accounting, as the
company is now building up provisions (i.e. vacation accruals) throughout
the year instead of once a year in December. Adjusted for this, EBITDA
amounted to EUR 0.5m.

Against this backdrop, management also provided an outlook for FY '24e,
targeting clearly positive EBITDA (eNuW: EUR 0.4m). Next to the continuous
expansions of the branch network, the newly acquired Forest GmbH (simulator
provider) is seen to contribute to this and compensate for the seasonally
weak Christmas period.

Moreover, the company announced last week the intention to resolve on
another cash capital increase. In detail, management intends to issue up to
430k new shares at a price of EUR 2.30 per share in a private placement. The
issue proceeds of around EUR 1m are to be used for expansion in Berlin,
Hamburg and Cologne. Overall, management targets 20 new locations until FY
'25e with an average revenue per location of EUR 500k, which shall all be
equipped with simulators as well.

According to the pending regulation changes, learner drivers will in future
be able to complete up to 10 lessons on a driving simulator, leading to
significant scale effects as this increases the FTE per learner driver
ratio. Through the acquisition of Foerst, 123f has also secured the sourcing
of the simulators. Next to this, the company's in-house instructor training
(10% market share) grants a substantial competitive edge given the average
age of instructor in Germany of c. 55 years. Unlike 123f, many competitors
are going to face succession problems going forward, which should also open
up the opportunity for some lucky-buys.

The stock remains a BUY with an unchanged PT of EUR 7.20 based on DCF.

You can download the research here: http://www.more-ir.de/d/30969.pdf
For additional information visit our website: www.nuways-ag.com/research

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
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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1999065 01.10.2024 CET/CEST

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Quelle: dpa-AFX