...leave us Corona, the monkey pox or other "nano-animals" alone! In any case, the shares of travel retailer DUFRY have been sought after since our last report. This was primarily because of the positive semester numbers: After the unprecedented slumps in the Corona years, sales have almost returned to pre-crisis levels; however, there is still a shortfall of about 25%, which is probably related to the temporarily weak Asian business, among other things. At CHF 2.9 billion, the company's sales were more than twice as high as in the same period last year. Despite still exorbitant inflation figures, tourists did not hold back with purchases in the duty-free stores; especially in North America, the Caribbean and the Mediterranean region, sales skyrocketed. Now, above all, the travel-happy but lockdown-hit Chinese have yet to "pull out their wallets"!
Although the "DUFRY tanker" is once again on course, the euphoria should not yet run riot in view of the existing challenges: After all, DUFRY has accumulated losses of around CHF 3 billion in 2020 and 2021. The modest minus of CHF 18 million in the first half of the year gives hope, but the road to significant black figures is still bumpy. Absent new negative pandemic surprises or an escalation in China (Taiwan conflict), we are convinced that steady improvements will materialize. In the current 3Q22, the recovery is expected to continue; already for 4Q22 and 1Q23, visibility remains somewhat limited; supply chain issues remain and recruitment is difficult. Also challenging will be the forward-looking acquisition of Autogrill. No one wanted DUFRY stock, but as is often the case, analysts are "coming out of the woodwork" on burgeoning hope; Goldman Sachs, Kepler and Vontobel have raised ratings to Hold. We were and remain at HOLD... and at the price target of CHF 76!
