INVISIO: Solid underlying development in Q2 - ABG

- Strong growth, adj. EBIT +14% vs cons but orders -8% vs cons
- Activity level to remain high for many years, positive outlook reiterated
- Adj. EBIT up slightly for consensus

Q2 details
Sales SEK 553m (2% vs ABG 541m, 16% vs cons 475m). Gross profit 257m (-4% vs ABG 268m, 5% vs cons 245m). Adj. EBIT 115m (-9% vs ABG 127m, 14% vs cons 101m). Adj. EBIT margin 20.8% (ABG 23.4%, cons 21.3%). Order intake SEK 245m (-21% vs ABG 310m, -8% vs cons 266m). Organic sales growth 104% (ABG 101%, no cons), gross margin 46.6% (vs ABG 49.5%, cons 51.6%).

Activity level to remain high for many years
Invisio delivered a large third party radio order in Q2, driving growth but diluting margins. Excluding this delivery, sales grew 44% and gross margin was 63.2% (up 3pp y-o-y). EO’s of SEK 15m for a cyberattack in Racal Accoustics were also booked, which we have adjusted for. Invisio reiterates its guidance that activity level in the market will continue to be high for many years, and we have not yet seen the full effect of higher military budgets. Adjusted operating costs were entirely in line with our expectations at SEK 142m.

Adj. EBIT up slightly for consensus
We expect consensus to raise 2024e adj. EBIT somewhat due to underlying beat and strong gross margin, although orders fell short of expectations. Share relatively neutral, held up by outlook comments on activity level. Conf call CET 10.00

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/invisio/Equity-research/2024/7/invisio---solid-underlying-development-in-q2/