Nexam Chemical: Recovery from Q2 low as expected - ABG

Sales -6% and adj. EBIT SEK +0.5m vs. ABGSCe
Outlook largely unchanged as the company recovers from Q2 low
The share is currently trading at 1.3-1.1x '23e-'25e EV/Sales


Q3 results

Sales came in at SEK 46m (-6% vs. ABGSC 49m), -19% y-o-y. EBIT was -2.8m (+13% vs. ABGSC -3.3m), and adj. EBIT was -2.8m (+13% vs. ABGSC -3.3m) for a margin of -6% (ABGSC -7%). Adj. net income was -3.8m (-8% vs. ABGSC -3.5m) for a margin of -8% (ABGSC -7%). The company produced lease adj. FCF of -3.9m, +67% y-o-y, and ended the quarter with a cash balance of 16.3m vs. R12m lease adj. FCF -28.3m. It is encouraging to see the EBIT margin recover significantly from the disappointing Q2 level, demonstrating that the company's cost savings programme is having an effect. Net income was however lower than expected due to higher than expected financial costs.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/nexam-chemical/Equity-research/2023/10/nexam-chemical---recovery-from-q2-low-as-expected/