Nolato: Back to earnings growth, still ground to cover - ABG

Q4e: first quarter since Q4'21 with positive y-o-y EBITA growth
Gradual margin improvement expected throughout '24e
Share trading at 15x '24e EV/EBITA, roughly in line with 5Y avg.


Q4e: positive y-o-y EBITA growth, first time since Q4'21

We expect Nolato to report Q4 sales of SEK 2,348m, down 1% y-o-y (-3% organic, +2% FX). Integrated Solutions keeps holding back organic growth (-35%), although given that we expect the segment in Q4 to only amount to 12% and 7% of group sales and EBITA, respectively, we argue this is of little importance. We expect an EBITA of SEK 198m, up 22% y-o-y, marking the first quarter since Q4'21 with positive y-o-y growth, and a margin of 8.4%. We expect the y-o-y earnings lift to be driven by lower input costs, mainly on lower electricity prices, which peaked in Q4'22, better capacity utilisation, and lower costs in Integrated.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/nolato/Equity-research/2024/2/nolato---back-to-earnings-growth-still-ground-to-cover/