Seafire: In tough times, take a look at the big picture - ABG

Q3e sales SEK 234m, +5% y-o-y (-7% org.), adj. EBITA margin 7.5%
Seafire 2008-2022 pro forma: 8% sales CAGR, 17% EBIT CAGR
Near term more challenging, but significant covenant breach unlikely


Q3e: In tough times...

Q2 was a rough quarter for Seafire, with -11% organic growth, an adjusted EBITA margin drop to 8.4%, and the Linguacom aftermath as the cherry on top. The main driver was underperformance in the consumer-exposed Nordbutiker and DOFAB. We now expect this to partly bleed over into Q3, and estimate sales of SEK 234, up 5% y-o-y (-7% org., +2% FX, +9% M&A), and adj. EBITA of SEK 18m, for a margin of 7.5%. We expect no significant changes in WC and estimate lease adj. FCF of SEK 6m.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/Seafire/Equity-research/2023/10/seafire---in-tough-times-take-a-look-at-the-big-picture/