Nolato: VHP production stop hurt Q4, Q1 better - ABG

Q4 report due on Wednesday, 8 February
Lower FX and more cautious on margin recovery timeline
15x '23e EV/EBITA, ~20% '22e-'24e adj. EBITA CAGR


Q4 to be hurt by VHP production stop and poor Medical mix

We expect Nolato to report Q4 sales of SEK 2,517m, down 20% y-o-y (-30% org, +10% FX). The significant organic sales decline is driven mainly by lower vaporiser heating product (VHP) sales within Integrated Solutions, where Nolato was not able to produce any products during Oct-Nov due to a permit issue at its Chinese production site, which has now been resolved. The lower VHP volumes in turn hurt margins, and we expect an EBITA of SEK 191m, for a margin of 7.6% (10.7%). Apart from lower VHP sales, which should be the main reason for margin pressure in Q4, we expect Nolato will continue to see issues with a poor sales mix in Medical Solutions from lower IVD sales as well as irregular capacity utilisation, which especially affects Industrial Solutions.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/nolato/Equity-research/2023/1/nolato---vhp-production-stop-hurt-q4-q1-better/