Midsona: H2'23e: Discontinuations and price hikes - ABG

• We cut '23e-'25e adj. EBITA by 27-4%
• Discontinuation of unprofitable products in full swing
• '24e EV/EBITA ~8x & lease adj. FCF of ~10%

Takeaways from the report and conf. call
Q2'23 came in below our estimates on both sales and earnings, as the company has taken a vigorous approach to discontinuing contracts and brands that are unprofitable. In absolute terms, this means a ~SEK 65m sales decline (or ~7%). Importantly, the adj. gross margin of 26.4% was in line with our expectations, and we continue to believe that it can be defended through further price hikes, which the management team signalled. As the company is reorganising its product and brand offering, it also aims to position itself toward the production of low-price products, a move that we believe will de-risk the company operationally

Länk till analysen i sin helhet: https://cr.abgsc.com/contentassets/d84f2fee64e14a0c8b9f43bb27d3128a/pdf/h223e-discontinuations-and-price-hikes.pdf