Coor: A step back in Q3e, but acceleration from Q4e - ABG

Q3e: stable sales (-1% org. growth), -6% adj. EBITA y-o-y
Minor estimate changes: 2% lower sales in Denmark '24e-'26e
11-8x EV/EBITA adj. and 7-12% FCF yields on '24e-'26e


Q3e: continued pressure from overhead costs

We maintain our view from our Q2 post-results comment that we expect Q3 to be a somewhat slower quarter. We forecast organic growth around zero, similar to last quarter, but we expect that the adj. EBITA margin will decline slightly y-o-y (3.9% vs. 4.2% in Q3'23), which in turn yields adj. EBITA growth of -6% y-o-y (compared to 0% in Q2'24). The main reason for this continues to be that Coor is carrying temporarily elevated overhead costs while it is implementing its reorganisation initiatives. We expect margins to strengthen from Q4'24 when we expect cost savings to have a more material effect. Another reason for the sequential growth deceleration is less tailwinds from variable volumes in Norway (more normalised levels), compared to Q2'24 when higher volumes helped mitigate the higher overhead costs. We predict relatively stable sales and margins for Sweden y-o-y. All in all, we forecast SEK sales of SEK 3,000m (-1% y-o-y, of which 1% organic) and adj. EBITA of SEK 118m (-6% y-o-y) for the group.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/coor/Equity-research/2024/10/coor---a-step-back-in-q3e-but-acceleration-from-q4e/