Lleidanetworks Serveis Telemàtics S A : Checkpoint · June 2024

Lleida.netBUY

… and the numbers keep on climbing in May

Analyst: Guillermo Serrano - [e-mail]

A new trading update, just published, has confirmed the positive operating trend since the start of 2024. Extrapolating for the published 5-month numbers, May 2024 saw a 19% sales increase, a 20% Gross Profit increase and a 23% drop in cash Opex in May.

Good news too in reported sales across Software Services (+7%), SMS Solutions (+11%) and SMS ICX (+44%) divisions during the month of May, a similar trend as April, and far superior to the 0% sales growth of 1Q24.

The most important element of this trading update is the rebound in the operating numbers taking on a better quality shape, compared with 1Q24 numbers.

Roughly half the improvement in Ebitda (cash) during this 2Q24 is coming from the rebound in Gross Profits and the other half from cost cuttings. In 1Q24, the entirety of the +182% improvement in Ebitda (cash) came from cost cutting.

We believe this to be important because the market is yet to give Lleida net credit for this (1Q24 results saw a share price upswing from €0.90 on April 29th, date of the announcement, to €1.30 on May 6th six trading days later). Its been trading sideways since, despite the superior quality April trading results, so the confirmation of the trend in these May results could provide a short term boost to the share price.

We are maintaining our 12-18 month price target of €3.00, which would place the stock on a 2025 EV/Ebitda (cash) multiple of 20x to reflect our unchanged estimates.

7am, 24th June 2024*

Equities

BME Growth

Price (5pm 21/6/24): €1,25

RIC: LLN.MC

Target Price (12-18 m): €3.00

52-Wk range (€):	1.82 - 0.69
Cap. Bur. (€ millones):	20.0
No. Shares (millions):	16,05
Avg. daily Vol. (€,12m):	48k
Daily volatility (avg. LTM):	4,7%

Price Chart (12 months)

This report was written by Checkpoint Partners (España) S.L.U.

*Date of publication and elaboration of this report

Source: LLN, Checkpoint partners

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Profit and Loss Account 2023-2026e

Source: LLN, Checkpoint partners

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Balance Sheet 2023-2026e

• The Net Financial Debt forecasts takes into account the €1.1million owed in shares to InDenova´s selling shareholders and held bylleida.netas Treasury Stock.

Source: LLN, Checkpoint partners

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Checkpoint Recommendation System

The Checkpoint Recommendation System is based on absolute returns, measured by the upside potential (including dividends and capital reimbursement) over a 12-month time horizon. Checkpoint recommendations (or ratings) for each stock comprises 3 categories: Buy (B),

Neutral (N) and Sell (S).

Buy: the stock is expected to generate total return of over 15% during the next 12 months time horizon

Neutral: the stock is expected to generate total return of -15% to +15% during the next 12 months time

Sell: the stock is expected to generate total return under -15% during the next 12 months time horizon.

History of recommendations

Date	Recommen.	Price (€)	Target P.(€)	Period	Analyst
16.03.2018	BUY	0,84	1,13	12 months	Guillermo Serrano
17.03.2018	BUY	1.11	1.53	12 months	Guillermo Serrano
17.07.2018	BUY	1.15	1.53	12 months	Guillermo Serrano
17.10.2018	BUY	1.03	1.53	12 months	Guillermo Serrano
24.01.2019	BUY	1.06	1.53	12 months	Guillermo Serrano
24.04.2019	BUY	0.92	1.40	12 months	Guillermo Serrano
23.07.2019	BUY	0.87	1.40	12 months	Guillermo Serrano
21.10.2019	BUY	1.01	1.60	12 months	Guillermo Serrano
21.01.2020	BUY	1.35	1.80	12 months	Guillermo Serrano
21.04.2020	BUY	1.75	3.00	12 months	Guillermo Serrano
21.07.2020	BUY	4,34	6.00	12 months	Guillermo Serrano
26.10.2020	BUY	8,90	12.00	12 months	Guillermo Serrano
26.01.2021	BUY	6.00	11.35	12 months	Guillermo Serrano
20.04.2021	BUY	6.28	11.15	12 months	Guillermo Serrano
22.07.2021	BUY	5.59	11.15	12 months	Guillermo Serrano
11.11.2021	BUY	4.38	9.00	12 months	Guillermo Serrano
22.02.2022	BUY	3.24	9.00	12 months	Guillermo Serrano
04.05.2022	BUY	4.06	9.00	12 months	Guillermo Serrano
11.08.2022	BUY	2.50	7.50	12 months	Guillermo Serrano
25.10.2022	BUY	1.84	6.00	12 months	Guillermo Serrano
09.03.2023	BUY	2.27	5.00	12 months	Guillermo Serrano
10.05.2023	BUY	1.64	5.00	12 months	Guillermo Serrano
05.09.2023	BUY	1.15	3.00	12 months	Guillermo Serrano
12.12.2023	BUY	0.80	3.00	12 months	Guillermo Serrano
06.05.2024	BUY	1.10	3.00	12 months	Guillermo Serrano
27.05.2024	BUY	1.35	3.00	12 months	Guillermo Serrano
24.06.2024	BUY	1.25	3.00	12 months	Guillermo Serrano

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