Original-Research: Cantourage Group SE - from NuWays AG Classification of NuWays AG to Cantourage Group SE Company Name: Cantourage Group SE ISIN: DE000A3DSV01 Reason for the research: Update Recommendation: Kaufen from: 17.05.2024 Target price: EUR 10.00 Target price on sight of: 12 months Last rating change: Analyst: Christian Sandherr Solid FY23 and Q1'24 prelims / / accelerating growth in April; chg.

Original-Research: Cantourage Group SE (von NuWays AG): Kaufen

Original-Research: Cantourage Group SE - from NuWays AG

Classification of NuWays AG to Cantourage Group SE

Company Name: Cantourage Group SE
ISIN: DE000A3DSV01

Reason for the research: Update
Recommendation: Kaufen
from: 17.05.2024
Target price: EUR 10.00
Target price on sight of: 12 months
Last rating change: 
Analyst: Christian Sandherr

Solid FY23 and Q1'24 prelims // accelerating growth in April; chg.
 
Topic: Cantourage issued solid FY23 and Q1 2024 prelims, which were
impacted by slower patient growth amid the looming (at that time)
regulatory changes. Sales figures for April (following legalization light)
show a significant acceleration.
 
FY23 sales grew by 67% yoy to EUR 23.6m (preliminary figures), slightly below
our estimate of EUR 24.7m as Q4 grew 'only' 30% yoy to EUR 6.4m vs the expected
50% to EUR 7.5m. To a large degree, this can be explained by a slower patient
growth in anticipation of the at that time looming Cannabis Act. FY23
EBITDA came in at EUR - 0.5m following a roughly EUR 400k loss after the first
nine months. The implied EUR 100k loss in Q4 is despite the slowed growth.
Management guided for high double-digit percentage sales growth and and at
least break-even EBITDA.
 
Legalization light tailwinds kicking in. While Q1 (on preliminary basis)
started out with "only" 26% yoy sales growth to EUR 6.2m, April (the first
month following the changes from the Cannabis Act) has already shown a
significant acceleration to 160%, which can be traced back to cannabis no
longer being considered a narcotic, notably simplifying dispensing by
pharmacies and prescriptions by doctors. Receiving a prescription for
medical cannabis has become as easy as for ibuprofen 600. While it is
difficult to reliably access the detailed impact on FY growth, we feel
comfortable with our estimated growth acceleration carried by Cantourage's
broad global supplier network with more than 60 grower partners and its own
recently launched telemedicine platform, telecan

.

Accordingly, we expect sequential growth during the coming quarters as thenumber of medical cannabis patients is seen to surge. Mind you, in Canada,the number of medial cannabis patients grew from 24k in 2015 to 330k in2018, the year of the full legalization and Germany had roughly 4m cannabisusers in 2021 with the majority buying from black markets.

While management has not issued a FY24 guidance yet, we expect them to doso once the company is able to better assess the sustainable impact fromthe Cannabis Act, likely with H2 figures, in our view.

We confirm our BUY rating with a EUR 10 PT (old: EUR 11), based on DCF.

You can download the research here:http://www.more-ir.de/d/29797.pdfFor additional information visit our websitewww.nuways-ag.com/research.

Contact for questionsNuWays AG - Equity ResearchWeb: www.nuways-ag.comEmail: [e-mail]: https://www.linkedin.com/company/nuwaysagAdresse: Mittelweg 16-17, 20148 Hamburg, Germany++++++++++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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