CAF wins contracts in Italy worth €120 million

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Intermoney| CAF informed the CNMV on Thursday that it has been chosen by the Italian operator ATM Milano for the supply of 105 electric buses.

These are 18-metre Urbino articulated buses, which will be delivered in the first half of 2025. This contract is in addition to the one signed with the Sicilian company AMTS Catania for the delivery of another 42 electric buses. Specifically, the agreement covers the supply of 32 Urbino 12 electric units on the one hand, and 10 Urbino 18 articulated electric units on the other. The total value of the contracts is estimated at over €120 million.

CAF continues to consolidate its position in the Italian market, especially in the electric and hydrogen bus segment. Among the contracts signed this year are the 98 electric buses for Cagliari and the 90 hydrogen buses for Venice, as well as the largest hydrogen bus contract in Europe, with which it will manufacture 130 hydrogen buses for the city of Bologna.

Assessment: Positive news, but with limited impact due to the size of the contract (less than 1% of the group’s portfolio). This contract brings CAF’s backlog to €13.7bn and continues to show year-to-date contracting capacity (€3bn, excluding €700mn of contracts awarded but not signed), with a book-to-bill ratio of >1. CAF published in its latest results an improvement in sales guidance for FY23, as well as delivering on the announced margin improvement. We maintain our buy recommendation with a target price of €38/share.

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