Blue Cap - Growing organically and through M&A

Blue Cap’s (B7E) first-half revenues grew strongly, driven by Knauer (acquired in June 2018). Organic sales growth was c 4% and adjusted EBITDA was up 8% to €6.5m. Management retained its FY19 guidance for a slight y-o-y increase in EBIT. End-June NAV increased by €1.6m to €119.8m, with the bulk of the uplift from coatings and plastics. Importantly, the dispute with Blue Cap’s major shareholder (46%), PartnerFonds (PF), seems to be resolved following the recent changes to the latter’s management and supervisory board. At the same time, Blue Cap’s supervisory board was extended to four members and the executive board is planned to be broadened (supported by CEO Dr Hannspeter Schubert). The company seems well positioned to take advantage of M&A opportunities arising amid the broader economic slowdown.