Embellence Group: EBITA in line, strong dividend - ABG

Net sales SEK 202m, +7% vs ABGSCe and Factset cons.
EBITA SEK 28m vs ABGSCe SEK 27m, cons. SEK 28m
Proposed DPS of SEK 1.25, 50% of net profit


Q4 in brief: In line, leveraging its strong balance sheet

Embellence Group's Q4 report is in line with Factset consensus expectations in general. Net sales of SEK 202m is +6% y-o-y (5% org.), 7% vs ABGSCe and cons. By brand, Boråstapeter grew -7% y-o-y, Cole & Son by -2%, Wall & Decó by -11%, Artscape by +53% due to order phasing by a large customer and External manufacturing by +61%, reflective of a new higher level for external sales also seen in previous quarters. We expect growth rates for external sales to come down gradually with the comps getting tougher. Gross margins were 60.9%, +310bp y-o-y. Combined with a 150bp higher SG&A ratio y-o-y from product development and marketing, the resulting EBITA margin of 13.9% was 160bp higher than last year's Q4. EBITA of SEK 28m was slightly better than ABGSCe SEK 27m and in line with cons. After a hiatus in 2023, the proposed DPS of SEK 1.25 per share for 2024 is more than 50% higher than the dividend for 2022 (SEK 0.80), and corresponds to 50% of this year's net profit vs its 30-50% target. It ends the year with a 0.7x ND/EBITDA ratio.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/embellence-group/Equity-research/2025/2/embellence-group---ebita-in-line-strong-dividend/