FFP S.A. One Of Europe’s Remaining Bargains?

FFP: Diversified portfolio

FFP is not a one trick pony. As well as Peugeot FFP owns E1.4bn in other publicly traded and non-public entities. Additionally, the group owns an interest in private equity funds, amounting to E207m and E52m of real estate. A snapshot of the group’s holdings as of year-end 2014 can be seen below.

FFP NAV

At the time of writing, FFP was trading at E68.50 per share, and as shown in the table above, is trading at a discount to its net asset value of around 28%. However, an up to date sum of the parts calculation implies that FFP’s NAV has jumped by more than 20% over the past three months.

For example, Peugeot’s market value alone has risen by 51% year to date. FFP’s second largest holding, Zodiac Aerospace has seen its value jump by 11.7% year to date. The table below shows the gains for the publicly traded securities held within FFP’s portfolio.

Holding YTD Change
Peugeot 51.5%
Lisi 23.3%
CID N/A
IDI SCA 12.2%
Zodiac Aerospace 11.7%
Orpea 15.7%
LT Participations 7.1%
DKSH 4.7%
Immobiliere Dassault 26.9%

*Lt Participations SA is a holding company operating through its subsidiary Ipsos SA

*Compagnie Industrielle de Delle (CID) is the main shareholder of the Lisi Group

Other assets owned by the group include the sole asset of SCI FFP-Les Grésillons, a building in Charenton-le-Pont, which was worth €17m at 31/12/2010. FFP also owns Château Guiraud a Sauternes wine estate that covers some 128 acres, almost 103 of which are vineyard. The average yearly output is 150,000 bottles of Sauternes. FFP owned 11,790,221 call options on the same number of Peugeot SA shares until 20 February this year.

FFP: Simple is best

The best investment thesis’ are simple, and it doesn’t take long to realize that FFP is an undervalued asset, especially consider the equity market gains in Europe over the past three months. FFP’s shares have themselves jumped 37% year to date but based on NAV figures; this still undervalues the equity.

ffp updated nav

NAV per share figures based on 25.1m shares in issue.

I should make it clear that this is only a back-of-the-envelope calculation and should not be used as investment advice. It is only intended to illustrate how undervalued the equity of FFP really is, based on the current value of listed holdings.

View the full article at http://www.valuewalk.com/2015/03/ffp-s-a-valuation/

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