Alcadon: Our thoughts ahead of the CMD - ABG

A deep dive into Alcadon on 29 September

Old financial targets to be updated

34% ’21-’24e EBITA CAGR, 12x ’23e EV/EBITA

CMD on 29 September
Alcadon will host a Capital Markets Day (CMD) for investors on 29 September at 08:30-12:00 CEST. According to the company the CMD will include a presentation of Alcadon’s business model, strategy, product offering, its different markets, “Vision 2025”, and updated financial targets. Key members of Alcadon’s management team will present, including the CEO Sonny Mirborn, CFO Niklas Svensson, Senior Vice President (SVP) Central Europe Susanne Stengade (the former CEO and owner of 6X International, acquired by Alcadon in Dec ’20), and SVP UK Duncan Lindsay (the former CEO of Networks Centre Holding Company, acquired by Alcadon in Aug ’22). The CMD will be hosted both virtually and on-site at Epicenter Stockholm, Mäster Samuelsgatan 36. Register via the link: https://live.twebcast.com/participant/alcadoncmd.

Updated financial targets to be presented
Since Sonny Mirborn became CEO in 2019 Alcadon has expanded its geographical exposure through strategic acquisitions, from solely Sweden and Norway to including Denmark, Germany, Benelux and the UK. The newly-added markets are characterised by a low fibre penetration, high growth, and extensive fibre roll-out ambitions (see our research from 10 August 2022, 7 December 2021 and 14 January 2021 for introductions to the UK, Benelux and Danish/German markets, respectively). Given the improved organic growth prospects, combined with a continued acquisition agenda (Mr. Mirborn stated in the Q2 report that Alcadon has identified additional companies that would further enhance the group’s competitive ability), we consider an update of the financial targets reasonable. We expect new targets of annual EBITA growth of 15-20% (10% org + 5-10% M&A) and ND/EBITDA of 2.5x-3.0x. See more on p. 3.
Trading at 12x ’23 EV/EBITA The share trades at 12x ’23e EV/EBIT and we expect a ’21-’24e EBITA CAGR of 34%.
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