Nolato: No quick fix for margin improvements - ABG

Underwhelming performance continues in Q4
EBITA down 7-3%, lower in both segments
Share trading at 15x '24e EV/EBITA


EBITA 9% below cons. in Q4 and a miss in Medical

Nolato's recent underwhelming performance continued into Q4, with EBITA being 11% ABGSCe and 9% below FactSet consensus. Most notably, the highest quality segment Medical Solutions came in 5% below our EBITA estimate (no cons. figure), which was a top-line driven miss, as surgery sales remained weak. However, the EBITA margin in Medical of 9.9% did mark a +40bp q-o-q increase, and was slightly above our estimate of 9.8%. In Engineering (merger of the old Integrated and Industrial segments), profitability in vaporiser heating products (VHP) comes down further on lower volumes, and while more cost-cutting measures in this area are set to be realised in H1'24, we expect VHP margins to remain poor given the degree to which volumes have dropped.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/nolato/Equity-research/2024/2/nolato---no-quick-fix-for-margin-improvements/