Careium: Growth to recover - ABG

Q1e: 7% organic sales growth y-o-y, 10% adj. EBITA margin
Expect a stronger H2, partly on lighter comps
Trading at 7.6x-6.1x '24e-'25e adj. EV/EBITA


Strengthened sales growth, but room for improvement

We forecast Q1 sales and adj. EBITA of SEK 211m and SEK 22m, respectively, corresponding to y-o-y growth of 9% (7.4% organic) and a margin of 10%, assuming the UK related technical issues in Q4'23 were temporary, and because the disruption due to a delay in the UK digital infrastructure transition to 4G/5G should be less of a drag in Q1. While we estimate organic sales growth of 12% for FY'24e (company expects 12-15%), we emphasise that it is H2 tilted, especially due to lighter comps in Q4, but we highlight that the growth is recovering quickly after a slow end to 2023 (Q4 showed flat organic growth). On margins, we believe there are limited changes in GM dynamics from Q4'23 and on opex, we expect a slight increase from the low Q4'23 levels to support growth ahead following a few quarters streamlining the cost base (admin in particular).

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/careium/Equity-research/2024/4/careium---growth-to-recover--/