Ework Group: Positive revisions on an improved '23 outlook - ABG

8% EBIT miss, but new, forward-leaning 2025 targets
Still solid demand: '23e-'24e EBIT up by 15-21%
13x '23e EV/EBIT, in line with its 5Y avg.


Sales +21% y-o-y, +2% vs. ABGSCe

Ework ended 2022 with another set of strong numbers. Q4 sales grew 21% y-o-y (+2% vs. ABGSCe), of which 6% stemmed from higher prices (5% in Q3) and 14% from increased volumes. We conclude that although there are some signs of a slowdown (orders grew 13% y-o-y, down from 18% in Q3, albeit against slightly tougher comps), overall demand remains solid, so we expect a healthy market in '23. This is also what peers to Ework see (e.g. Knowit), while Radar expects 4.1% growth (of which 3-4% from prices). In terms of regions, Sweden performed better than we expected, while Norway only saw 8% growth as some customers remain hesitant due to the recent discussion about the legislative process of freelancers. The gross margin of 3.7% was flat vs. Q4'21. Although opex grew 20% y-o-y, Ework showed good operational leverage, driving EBIT +30% y-o-y (but -8% vs. ABGSCe).

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/ework/Equity-research/2023/2/ework-group---positive-revisions-on-an-improved-23-outlook/