Alcadon - EBITA beat on lower costs - ABG

- Adj. EBITA SEK 22.9m (+8% vs. ABGSCe 21.3m)
- Q3 numbers imply +2% adj. EBITA upgrades
- 8x '24e EV/EBITA on pre-Q3 estimates

Q3 outcome
Sales were SEK 381m (+2% vs. ABGSCe 375m), up 32% y-o-y, of which -3% organic (ABGSCe -1%). Despite sales being roughly in line, adj. EBITA was SEK 22.9m (+8% vs. ABGSCe 21.3m), for a margin of 6.0% (ABGSCe 5.7%), which included FX effects on outstanding earn-outs. Some slowdown on sales, as expected, but impressive cost control, and the highlight of the report, in our view, was exceptionally strong FCF (FCF/EBIT ~250%), driven by a NWC release amounting to 6.4% of market cap.

Estimate changes
The Q3 numbers in isolation would imply positive adj. EBITA revisions of ~2%.

Valuation and conference call details
On our pre-Q3 estimates, the share is trading at 8x '24e EV/EBITA, offering a '23e-'25e adj. EBITA CAGR of 21%. Finally, the company will host a conference call at 14:30 CET (in Swedish)

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/alcadon/Equity-research/2023/10/alcadon---ebita-beat-on-lower-costs/