(BFM Stock Exchange) – The French specialist in cold logistics suffers on the Paris Stock Exchange, after having revealed a decline in its profitability greater than feared.

The decline in volumes of food products transported in Europe has grew the annual results of STEF.

In 2024, the “French Society of Transport and Frigoring Sleepman” born in 1920, which has simply become “Stef” revealed a turnover up 8.1% to 4.80 billion euros for the financial year 2024.

Despite this increase in income, profitability has not followed. STEF unveiled an operating profit with 9% with 224 million euros, which is below the ICAP Midcap TP expectations which tablished on 243 million euros. The current operating margin fell from 90 base points over a year, or 0.9 percentage points at 4.8% in 2024.

Pressures on profitability

This deterioration of the results was expected by the market given the winds contrary to which the company was faced. In France, Stef assigns this erosion of profitability to the contraction of volumes treated within the transport activities of fresh products and seafood, despite a slowdown in inflation.

In Italy, Stef explains that its profitability has been undermined by the high contraction of the market, by difficulties linked to an operational incident as well as by the costs of implementing the frozen system.

This erosion of the margins is “worse than expected”, to use the title of the note of TP ICAP Midcap published this Friday, March 14.

Florent Thy-Tine, head of action research at TP ICAP Midcap. still wants to underline the progression over one year of the gross operating margin (EBITDA) of 50 base points (0.5 percentage point) at 10.1%.

The demand for road transport has slowed down in Europe, which has penalized the margins in the logistics and transport sectors, while the production costs have continued to undergo the effects of inflation. This situation has impacted the organic growth of our turnover as well as the evolution of our operating profit, “said Chairman and CEO Stanislas Lemor.

The group’s net profit fell 18% over one year to come out at 157.2 million euros. The generation of cash is also under pressure with a free cash flow which fell into negative territory up to 50 million euros.

On the dividend side, Stef plans to pay a third of his results in accordance with his return to the shareholder policy. Under 2024, the group will pay a coupon of 4.15 euros, a drop of 0.9 euros compared to 2023.

An exercise dedicated to the integration of recently acquired companies

The latest results delivered by Stef Thursday evening after-Bourse clearly seized investors. The French specialist in cold logistics unscrews 9.6% to 120.20 euros around 3:25 p.m. on the Paris Stock Exchange.

As usual, the group has not revealed encrypted prospects for the current exercise, but says that 2025 “confidence in its resilience capacities” despite a very unstable economic and geopolitical context this year.

The company claims to remain concentrated on the continuation of the implementation of its strategic plan “committed to a sustainable future”, which will enter the second phase. The current exercise will be dedicated to the integration of the latest acquired companies.

TP ICAP Midcap believes that the pressure on the course in the event of disappointment on this publication is to be used to position itself on a file whose valuation “seems attractive”. The financial intermediary therefore renews his confidence in Stef, and his recommendation for the purchase the day after the group’s annual publication, with a price target of 156 euros.