Alcadon: Higher costs to secure growth - ABG

Q2 EBIT SEK 17m, -9% vs. ABGSCe
Strong outlook for ‘22e intact
8x ’22e EV/EBIT including German contract

Sales SEK 177m (0% vs ABGSCe 178m) 35% y-o-y, of which estimated -8% organically. The organic growth was weighted by component shortage and supply-chain disruptions, primarily in Sweden and early Q2. EBIT SEK 17m (-9% vs ABGSCe 19m), EBIT margin 9.7% (13.4%) vs. ABGSC 10.7%. The margin was negatively affected by increased raw material prices and temporarily increased opex due to increased recruitments to support the growth agenda. Net profit 13m (-8% vs ABGSC 14m).

The share is up 38% L3M, driven by several important contracts in Germany and Denmark. On our pre-report estimates which does not include the German contract that was announced on Wednesday, 11 August, the share is trading at 11x ’22e EV/EBIT (c. 8x ‘22e EV/EBIT including German contract), offering 8% lease adj. FCF yield for ’23e. Alcadon announced that updated financial targets will be presented to better reflect its strategic growth agenda until 2025.

Länk till analysen i sin helhet: https://www.introduce.se/foretag/alcadon/Equity-research/2021/8/alcadon---higher-costs-to-secure-growth/