Nexam Chemical: Look past this quarter - ABG

Sales temporarily weaker (down 4%), but record gross margin of 47%
We cut '24e-'26e sales by 4-5% and '25e-'26e EBIT by 5%
Remain optimistic Nexam will grow and reach positive EBIT in Q4


Q3 results

Sales were down 4% y-o-y (we estimate 2% organically), with the decline driven by certain historically large customers that are facing temporary market headwinds and thus ordering significantly lower volumes in the quarter. This was however partially offset by SEK >5m in sales from new customers or products. The gross margin reached a new high of 47% (43%), surprising positively, as a result of optimised recipes and purchasing. Due to the unexpectedly low sales volumes, EBIT of SEK -2.5m (-2.8m), did not quite meet our expectation of turning positive in the quarter, but opex was roughly in line with our estimates.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/nexam-chemical/Equity-research/2024/10/nexam-chemical---look-past-this-quarter/