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With more than a quarter of the global market for traditional closures, the Portuguese Corticeira Amorim wears well its 152 years since its stronghold of Mozelos. A billion euros in turnover and 83 million euros in net profit expected this year, reduced debt, a robust dividend and a shareholder-directing family: the company has solid assets to assert on the stock market. We are getting close enough to the basic value of the portfolio, to those that do not present a great risk over the long term. Which do not necessarily thrill thrill seekers either, it must be admitted. But at less than 15 times expected earnings next year, the deal hasn’t been so affordable since 2016.
The activity is growing modestly but steadily (3 to 4% annual increase in sight over the coming years), thanks mainly to the gentle slope displayed by the wine and spirits market. Corking allows, in turn, to benefit from the basic trend of the rise in the range of alcohols, an expression for which advertisers prefer to substitute the dreadful “premiumisation”. On the results side, the margins are solid, with a tendency to improve over time. Net profit should increase from 75 million euros in 2021 to 104 million in 2024, according to analysts’ projections, an average annual increase of 8.5%. The balance sheet is healthy: despite rising debt after the acquisition of the Italian Saci at the start of the year, the coverage ratios are quite comfortable.
Corticeira Amorim is established on five continents, with strong roots in Europe, where it generates 70% of its activity. The Americas (24%) and the rest of the world (6%) complete the picture. A small curiosity that is not without interest: the company has such a large base of buyers that none of its customers represents more than 1% of its income. The Portuguese makes 70% of its sales in corks, but cork is also at the heart of its other divisions. In this case floor and wall coverings (14% of turnover), composites (13.6%), insulation (1.5%) and raw materials (1.2%). If the insulation or the cork parquet floors raise few questions, the composites division deserves a little attention. This is the most unique and technical branch of the group. Did you know that cork is used in the nose of the Vega space launcher or for sealing complex parts? Amorim Cork Composites was originally created to take advantage of the 70% cork waste generated by the group’s other activities. “Nothing is lost, everything is transformed”, to hijack Lavoisier’s apocryphal quote.
This reuse, and more generally the exploitation of a renewable resource, is today worth to the company to appear in our theme Climate
