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Equity Bottom-Up

Mytilineos Holdings Sa / Equity Bottom-Up

<p>Mytilineos’s 9M results suggest that it is on track to reach our FY19 forecasts. While declining alumina/aluminium prices create earnings risks for FY20, the efficiency programme launched in Q319, the strength of the US dollar vs the euro and volume growth are potentially mitigating factors. We forecast an average FY20–22 free cash flow yield of 14% and our broadly unchanged valuation of €14.5/share offers significant upside.</p>

Mytilineos’s 9M results suggest that it is on track to reach our FY19 forecasts. While declining alumina/aluminium prices create earnings risks for FY20, the efficiency programme launched in Q319, the strength of the US dollar vs the euro and volume growth are potentially mitigating factors. We forecast an average FY20–22 free cash flow yield of 14% and our broadly unchanged valuation of €14.5/share offers significant upside.

Mytilineos - Growth on track, increased focus on cost cutting