Minoan – Initiation of Coverage
Crystallisation of value created at a vast 5,500 acre world class holiday resort in the Med with outline planning permission now imminent
Minoan Group joined AIM in 2007 to further its project on the Cavo Sidero peninsular in Crete. Amongst other things, holiday makers visit the Greek islands for the relaxed pace of life. Investors have got to admire the stamina and tenacity of the board, led by Executive Chairman Christopher Egleton who, for more than 10 years, has navigated this project through the Greek system to emerge, finally, triumphant in June 2017.
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Upmarket resort project designed to be the most sustainable in Europe
This large Crete holiday resort project is being rapidly advanced further through the planning and development process, adding more value. Management are now sensibly seeking to crystallise the large value that has been created by bringing onboard operational and financial partners.
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Crete has the best climate in Greece and a shortage of upscale resorts
Problems in the sea and sun destinations of Turkey and Egypt have led to record levels of tourism in Crete, which sits far away from the migrant route. The project lies on an unspoilt peninsular which is a unique location in which to build a modern low density upmarket integrated resort.
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Travel & Leisure division being sold off to allow Minoan to be debt free
With issues being dragged out in the Greek courts, the board embarked on a buy and build strategy to create a niche travel agency business to support the company and help finance the cost of driving the Crete Project forward.
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Our conservative valuation suggests an upside of more than 197%
Peer comparisons provide a conservative valuation. We initiate coverage of Minoan Group with a target price of 18.6p and Conviction Buy stance.
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DISCLAIMER
Minoan Group (MIN) is a research client of Align Research. Align Research holds an interest in the shares of MIN. For full disclaimer information please refer to the last page of the full document. This investment may not be suitable for your personal circumstances. If you are in any doubt as to its suitability you should seek professional advice. This note does not constitute advice and your capital is at risk. This is a marketing communication and cannot be considered independent research.
| Year to Oct | 2016A | 2017A | 2018E | 2019E |
|---|---|---|---|---|
| Revenue (£'000) | 7,317 | 8,700 | - | - |
| PTP (£'000) | (2,272) | (2,516) | (1,450) | (1,000) |
| EPS (p) | (1.19) | (1.23) | (0.66) | (0.38) |