Inission: Another impressive quarter, outlook good - ABG

Growth of 17.5% and strong adj. EBITA margin of 8.8% (4.8%)
Demand in Inission still good, Enedo seeing some slowdown
Expect growth to continue in '24e, but less than in elevated '23


Q3: Strong quarter, but temporary lag in cash flow

Q3 sales were SEK 515m, up 17.5% y-o-y, with the growth mainly driven by the Inission segment. Adj. EBITA was SEK 45m (21m) for a margin of 8.8% (4.8%). This was very strong, especially considering that Q3 is a holiday-heavy quarter. The strong profitability was enabled by higher efficiency in Inission's factories, as component shortages subsided and new personnel grew accustomed to the job. Production capacity is now in line with demand. The strong adj. EBITA converted into adj. EPS of SEK 1.38 (0.17). Lease-adj. FCF was SEK -20m (139m), hampered by a SEK 86m decrease in current liabilities. This was caused by a number of factors, including payment of overdue invoices in Enedo, reduced material purchases and fewer prepayments now that component shortages are no longer a problem. We expect this to improve in Q4'23.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/inission/Equity-research/2023/11/inission---another-impressive-quarter-outlook-good/