Careium: Growth recovering and solid cash flow - ABG

Q1 sales in line with est. at SEK 211m, 8% org. growth
EBIT in line, and FCF better than expected at SEK 17m
Unchanged guidance - trading at 8x '24e EV/EBITA on pre-Q1 ests.


Q1: recovering org. growth to 8% and strong cash conversion

Careium delivered sales of SEK 211m (0% vs ABGSCe 211m), 6% q-o-q and 8% y-o-y organically ex. FX (ABGSCe +7%). Sales were negatively continuously affected by continued headwinds in the UK, primarily in the beginning of the quarter, but eased up during the latter part. Segment wise, Service sales was SEK 155m (-4% vs ABGSCe 162m), and Product sales was SEK 56m (12% vs ABGSCe SEK 50m), of which the latter supported by a healthy recovery in the UK. The guidance remains unchanged and our pre-Q1 estimates suggest a gradual improvement in organic growth throughout the year. The gross margin increased to 43% (+2pp vs ABGSCe 41%, 3pp q-o-q and 4pp y-o-y), on a favourable mix and improved efficiency. EBIT reached SEK 19m (+3% vs. ABGSCe 18.5m), for a margin of 9.1% (ABGSCe 8.7%, 3.8% in Q1’23). Opex came in slightly higher than expected at SEK -71m (6% vs. ABGSCe -67m), but the better-than-expected gross margin was more than offsetting it.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/careium/Equity-research/2024/4/careium---growth-recovering-and-solid-cash-flow-/