Software
A D V A N C E D V I S I O N
7 August 2001 1,21 Euro AVTE
OUTPERFORMER (NEUTRAL)
FAIR VALUE 3,9 Euro
Anne Gronski
ADVANCED VISION TECH.NM
M O R E C A S H T H A N C A P
Share is trading at about one third of net cash value. Company’s inspection systems promise major
growth future potential and the consistent growth strategy seems to be the best way to go in the current
difficult market environment. Turn around targeted for 2004 still seems far away and there is no sign of
a recovery in demand yet. However, the high discrepancy between net cash and market cap. reduces the
downside risk and provides a large upside potential. We upgrade from neutral to outperformer.
Year end Sales Net Profit EPS P/E EV/EBITDA EV/Sales EBIT-Margin Dividend Yield
1999 10.0 -0.6 -0.05 n.m. EV neg. EV neg. -3.2% 0.0 0.0
2000 13.7 -0.3 -0.03 n.m. EV neg. EV neg. -13.9% 0.0 0.0
2001e 11.8 -6.1 -0.54 n.m. EV neg. EV neg. -67.1% 0.0 0.0
2002e 14.8 -6.4 -0.57 n.m. EV neg. EV neg. -53.2% 0.0 0.0
2003e 18.5 -3.5 -0.31 n.m. EV neg. EV neg. -24.9% 0.0 0.0
In
Market Cap. : EPSCAGR 98-2003: n.m% High/Low: 6/0.5 Free Float: 40%
____ H101 results low– preparing for better times
As expected, operating expenses were at a high level as a consequence of the company’s strategy to
improve its global sales network and further develop its product portfolio. However, sales were below our
expectations and order intake still shows no clear sign of an upswing.
____ A promising product portfolio
The company currently provides five automatic inspection systems. Four of them are for packaging
printing, the company’s main market, and one is for commercial printing. All of them have the advantage
of high standardization and can be installed in three to four days. We believe that the high margin
pressure in the printing industry will increase its demand for automatic inspection in the medium term.
AVT further plans to launch an inspection system for label printing middle of next year and one for
sheetfed presses in 2003, thus expanding in further markets.
____ High cash cap discrepancy increases upside potential
We only expect a recovery in demand if there is an upswing in the US and anticipate that the turn around
will be delayed to mid 2003 as a consequence of the high R&D expenditure. However, the share currently
trades at about one third of its net cash value (3,8 Euro) de-listing as limited, given the company’s cash reserves and its shareholder structure. The product
portfolio is promising and the current high discrepancy between cash and share price enhance the upside
potential. We therefore upgrade the stock from neutral to outperformer.
A D V A N C E D V I S I O N
7 August 2001 1,21 Euro AVTE
OUTPERFORMER (NEUTRAL)
FAIR VALUE 3,9 Euro
Anne Gronski
ADVANCED VISION TECH.NM
M O R E C A S H T H A N C A P
Share is trading at about one third of net cash value. Company’s inspection systems promise major
growth future potential and the consistent growth strategy seems to be the best way to go in the current
difficult market environment. Turn around targeted for 2004 still seems far away and there is no sign of
a recovery in demand yet. However, the high discrepancy between net cash and market cap. reduces the
downside risk and provides a large upside potential. We upgrade from neutral to outperformer.
Year end Sales Net Profit EPS P/E EV/EBITDA EV/Sales EBIT-Margin Dividend Yield
1999 10.0 -0.6 -0.05 n.m. EV neg. EV neg. -3.2% 0.0 0.0
2000 13.7 -0.3 -0.03 n.m. EV neg. EV neg. -13.9% 0.0 0.0
2001e 11.8 -6.1 -0.54 n.m. EV neg. EV neg. -67.1% 0.0 0.0
2002e 14.8 -6.4 -0.57 n.m. EV neg. EV neg. -53.2% 0.0 0.0
2003e 18.5 -3.5 -0.31 n.m. EV neg. EV neg. -24.9% 0.0 0.0
In
Market Cap. : EPSCAGR 98-2003: n.m% High/Low: 6/0.5 Free Float: 40%
____ H101 results low– preparing for better times
As expected, operating expenses were at a high level as a consequence of the company’s strategy to
improve its global sales network and further develop its product portfolio. However, sales were below our
expectations and order intake still shows no clear sign of an upswing.
____ A promising product portfolio
The company currently provides five automatic inspection systems. Four of them are for packaging
printing, the company’s main market, and one is for commercial printing. All of them have the advantage
of high standardization and can be installed in three to four days. We believe that the high margin
pressure in the printing industry will increase its demand for automatic inspection in the medium term.
AVT further plans to launch an inspection system for label printing middle of next year and one for
sheetfed presses in 2003, thus expanding in further markets.
____ High cash cap discrepancy increases upside potential
We only expect a recovery in demand if there is an upswing in the US and anticipate that the turn around
will be delayed to mid 2003 as a consequence of the high R&D expenditure. However, the share currently
trades at about one third of its net cash value (3,8 Euro) de-listing as limited, given the company’s cash reserves and its shareholder structure. The product
portfolio is promising and the current high discrepancy between cash and share price enhance the upside
potential. We therefore upgrade the stock from neutral to outperformer.
