Inission: Better than it looked - ABG

Sales -6% due to Enedo despite high material sales in Inission comps
EBITA margin 5.6% (adj. 6.4%), Enedo SEK 5m inventory write-down
'24 guidance in line with our estimates, trading at 9-7x '24e-'26e P/E


Q4: Inventory write-downs weigh on Enedo-margin

Sales were SEK 554m, down 6% y-o-y (-6% organic, +2% adj. for SEK 48m in elevated material sales in comps). The revenue decline was entirely attributable to the Enedo segment, where sales were down 26% y-o-y, but note that the Tunis factory was flat y-o-y, meaning that Italy and Finland caused the decline. EBITA was SEK 31m (28m), for a margin of 5.6% (4.7%). Inission delivered a margin of 6.9%, while Enedo only managed 0.6%. This was mainly due to ~SEK 5m in inventory write-downs in Enedo. Without these the margin would have been closer to 5%. As we believe these write-downs were of a non-recurring nature, we have chosen to adjust for them, resulting in a group adj. EBITA of SEK 36m (28m), for a margin of 6.4% (4.7%). Adj. EPS was SEK 0.80 (0.77) and the group delivered a strong lease adj. FCF of SEK 17m (-26m).

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/inission/Equity-research/2024/2/inission---better-than-it-looked/