StrongPoint: Challenges continue - ABG

Q4e soft, market remains muted
Lower range of targets likely
Recovery postponed, '25 also slow


Q4e soft, market remains muted

We expect Q4 to be another challenging quarter driven by muted market conditions, as decision-making cycles remain long and projects continue to be postponed. Norway remains challenging, although signals of lower interest rates may improve project investments. Sweden is more positive (rate cuts), while Baltic is expected to remain steady (Maxima). The UK is still challenging (postponements). We expect StrongPoint to report Q4 revenues of ~NOK 330m (flat y-o-y). The GM will likely hover at 40-41% vs. 42.7% in Q3 (favourable mix). We forecast Q4 EBITDA of NOK 6m, EBIT of NOK -5m and net profit of NOK -6m. Q1e will likely be flat q-o-q, i.e. weaker than we anticipated. The Mercadona contract seems to be developing slower than we expected, which explains the lower '25e/'26e estimates. StrongPoint had disposable funds of NOK 61m in Q3 (NOK 34m cash, NOK 27m undrawn credit facilities), but it has entered a refinancing arrangement that replaces the previous facility with a combination of RCF and WC financing of NOK 200m. It should have sufficient funds short-term, but it may be more challenging medium-term if the market situation persists.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/StrongPoint/Equity-research/2025/2/strongpoint---challenges-continue/