Strong Long-term Investment Opportunity
Since its listing in 2005, Dufry has pursued and successfully executed a consistent strategy focusing on profitable growth and cash generation to create value for shareholders and bondholders alike. In the first phase, the company accelerated growth mainly through acquisitions, and more recently shifted towards a more balanced growth profile including both organic growth and acquisitions.
Despite the temporary challenges that our industry and the company are facing due to COVID-19, we strongly believe that travel retail is a resilient industry, which will continue to benefit from the secular passenger growth trend. Industry associations expect a return to pre-Covid passenger numbers in 2023 / 24. The willingness of people to travel was also confirmed by online research done by Dufry in June and November 2020 as well as in January 2021 showing clear indications of our customers’ propensity to continue travelling as soon as the respective restrictions are lifted.
Only pure-play to invest in travel retail.
Pure-player in the resilient travel retail channel
The strong underlying fundamentals of travel retail – secular long-term global passenger growth fueled by a growing, more affluent population in many countries, as well as the still high fragmentation of the industry – are cornerstones of Dufry’s investment case. Dufry has a track record of organic growth in line with regional passenger developments; growth acceleration through M&A; strong cash generation on the back of an attractive risk profile based on our diversification by geographies, channels and sectors. Dufry’s diversified footprint supported the company even in 2020 when facing a global pandemic, by balancing regionspecific travel restrictions. Moreover, the company’s strong cash generation capability will be further supported by the successful implementation of its reorganization and the expected structural savings from 2021 onwards. For a detailed view on Dufry’s investment case please click here.
Dufry’s capital allocation policy has been adapted to the current environment with the objective to protect liquidity amid a limited visibility on the recovery trajectory. Dufry targets deleveraging in line with the recovery trajectory, reaching below 4.5x Net Debt / Adjusted Operating Cash Flow by 2022, and a mid-term leverage level in line with pre-crisis. We expect attractive, shareholder value generating opportunities for profitable growth to arise in the short- and medium-term and we will thoroughly assess any investment from a value accretion point of view once the business has started to recover sustainably.
In the context of the evolution of the COVID-19 pandemic, the Board of Directors has therefore proposed to the General Meeting of Shareholders 2020 not to pay a dividend in order to safeguard the short-term liquidity of the company. Under consideration of the still low visibility and the speed of the recovery, the Board of Directors has decided to propose to the 2021 General Meeting of shareholders to suspend the dividend payment for the 2020 business year as well.
Member of the SMI MID (SMIM) Index
With a market capitalization of CHF 4.461 billion as per December 31, 2020, Dufry is part of the SMI MID (SMIM) Index on the SIX Swiss Exchange, which includes the 30 biggest publicly listed companies in Switzerland not already represented in the Swiss Market Index (SLI).
Dufry’s share price started the year at CHF 96.88, reached a high of CHF 97.36 in early January, saw a decline accentuating in line with the spread of the pandemic, and reached a low of CHF 20.10 in mid-March. Consequently the share price steadily recovered to CHF 55.58 at the end of December 2020 supported by internal initiatives to restructure the organization, implement sustainable cost saving initiatives, strengthen the financial position and enhance the liquidity, as well as favorable external news flows regarding vaccine developments, international alignment of travel-related recommendations and recovery expectations.
Dufry’s trading volume continued to be healthy in 2020. Dufry’s average daily trading volume was approximately CHF 64.0 million. The SIX Swiss Exchange remains our most important trading platform, where the average daily volume of Dufry shares reached CHF 38.8 million in 2020. Dufry’s trading volumes are mainly concentrated at the SIX 61% and BATS Chi-X OTC 39% platforms.
Our long-term shareholders, in particular Advent International, Alibaba Group, Qatar Investment Authority, Travel Retail Investments, Richemont, GIC Asset Management, as well as Norges Bank, FMR LLC and Fidelity Investment Trust represented 48.7% of our share capital and strongly support Dufry.
Dufry has a free float of around 71%, which is well balanced, with shares being held by institutional investors in the most important investor regions such as the United States, the United Kingdom, APAC, Switzerland and also across Europe.
Strong investment track-record for bondholders
Dufry has been a well-established investment opportunity in the bond market ever since the issuance of its first Senior Notes in 2012. On the one hand, the bond market represents an important source of financing for the company, while on the other hand, our low operating leverage, as well as the strong and resilient cash flow generation capabilities, are characteristics welcomed by the fixed income market.
The company’s healthy reputation as an attractive bond market opportunity was well confirmed in April 2020, when the company issued CHF 350 million senior convertible bonds due in 2023, conditionally convertible into company shares and carrying a coupon of 1%. Dufry’s Senior Notes are currently rated (B+) by Standard & Poors and (B1) by Moody’s.
In April 2020, Dufry also placed in total 5.5 million new shares, 5,000,000 of which were sourced from existing authorized capital excluding pre-emptive rights and 500,000 coming from existing treasury shares. The placement was successfully executed through an accelerated book-building.
Long-term financing strengthened.
In April 2020, Dufry also secured a new twelve-months committed credit facility of CHF397 million with two six-months extensions. Additionally, Dufry has bank credit facilities in place totaling close to CHF1,161 million maturing in 2022, and around CHF2,271 million maturing in 2024 (denominated in multiple currencies). Moreover, as per end of December 2020, Dufry had CHF205.0 million of COVID-19 related government-backed loans.
Fair and comprehensive market communication
Dufry is committed to open and transparent communications with the financial market to present our equity story and investment opportunities. We pursue a constant, open dialogue with investors, analysts and the media through direct phone and email exchanges, regular roadshows and conference attendance, one-to- one meetings and dedicated investor days, either in person or virtually.
Senior management presents and discusses financial performance on a regular basis and we provide the financial community and media with in-depth reports and information through press and analyst conferences, conference calls and webcasts. In this context, and as already disclosed in its third quarter results publication 2019, Dufry releases quarterly trading update statements for Q1 and Q3 and publishes full financial results for the half-year and full-year periods.
As part of our 2020 Investor Relations activities, senior management and the Investor Relations team invested 42 days to meeting investors directly or virtually through roadshows and conferences in Europe, North America and Asia, during which we met around 660 investors in one-to-one or group meetings and many more in presentations. Apart from meetings, the Investor Relations team answered more than 960 calls and emails in 2020. This results in a total of close to 1,620 contacts with investors and analysts. For contact details of our Investor Relations team located in Switzerland and Brazil, please see the top right-hand corner of this page.
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More about Dufry
Learn more about the Dufry group in more depth:
Dufry will attend and be represented at the conferences and exhibitions related to the travel retail industry listed below. We are looking forward to meet you there.
- 28Sep 2021
Santander EuroLatam Virtual Infrastructure & Utilities Conference
- 29Sep 2021
Mirabaud Investor Conference Call
- 05-06Oct 2021
UK Roadshow: Goldman Sachs
- 07Oct 2021
Octavian Investor Meeting
Retail Brands Our Retail Brands
You may know of Dufry through one of our many other retail brands. If you would like to connect directly with one of these, please see the below links to our entire portfolio.