Pricer: Stepping stone for further margin recovery - ABG

Higher sales and lower costs behind strong margin expansion
We lift '24e EBIT by 12% on lower opex assumptions
Good outlook for higher margins in '24e, 8x '24e EV/EBIT


Margins trending upward

Pricer delivered a strong Q4 report. Sales saw a record-high level of SEK 801m (+13% vs. ABGSCe), mainly driven by good deliveries in Europe, as the US has seen halted instalments from one of its major customers. The gross margin, adjusted for an inventory write-down of 0.7ppt, improved to 18.4% (vs. 18.1% in Q3), while adj. opex decreased 13% y-o-y despite the recent cost savings not being expected to provide results until Q3'24. Adjusting for restructuring charges and an impairment, EBIT of SEK 54m was well above ABGSCe SEK 17m, and improved from SEK 28m in Q4'22 for a margin of 6.8% (4.0%). In our view, the ongoing cost savings bode well for further margin expansion in 2024e.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/pricer/Equity-research/2024/2/pricer---stepping-stone-for-further-margin-recovery/