EuroSports Global

EuroSports Global: FY14 net profit spiked 153% to $17m, on the back of a one-off $16.2m gain from the sale and leaseback arrangement of the property at 30 Teban Gardens Crescent. Meanwhile, revenue halved to $39.8m as the group only sold 15 Lamborghinis, compared to 42 in FY13, as a result of the new government regulations- additional registration fees and financing restrictions, as well as the end of life cycle for the Gallardo model. The other segments- after-sale services gained 6% to $5.3m and sale of deLaCour watches grew 40% to $3.2m, which subsequently propped up overall gross margin to 22.2% (+2.3ppts) on the change in mix. Going forward, EuroSports expects the launch of Lamborghini’s new Huracán model in Sep 2014 and the Alfa Romeo 4C model in Jul 2014 to have a positive impact on sales in 2H15. Taking a cue from the previous launch of the current Lamborghini Gallardo and Aventador in 2011 and 2012, the number of cars sold during those years stood between 50-55. Group declared final DPS of $2.8¢, in line with its intention to distribute the proceeds from the sale and leaseback arrangement. At $0.28, EuroSports trades at 2x P/B.