Urb-it: Reached positive GM1 in France - ABG

Q2 numbers in line with ABGSC estimates

We forecast H2’22e to grow by triple-digits

Transfer of analysts results in significant est. revisions

Key takes from the Q2’22 report
Urb-it’s reported Q2’22 numbers were much in line with our expectations. Top-line growth of 110% for sales of SEK 12.4bn was 4% ahead of ABGSC estimates whereas the operating loss of SEK 35.6m was in line. EBIT grew by SEK 8.2m q-o-q as the company has successfully reduced its direct delivery costs, which is reassuring in our view. In its key market, France, Urb-it stated that it reached a positive gross margin after direct delivery costs in the second quarter. Furthermore, it recently expanded its offering by entering the fast-growing parcel locker segment market. A NWC release of SEK 1.5m supported operating cash flows, which amounted to SEK -30.1m whereas tangible investments decreased by SEK 3.1m q-o-q, resulting in a cash position of SEK 17.2m by the end of Q2’22.

Outlook: triple-digit sales growth and share issue ahead
Urb-it has signed and expanded a large number of contracts over the last few years (e.g. Shopify, Yodel, Zalando and Amazon). We expect to see a continued ramp-up of these contracts. Furthermore, alongside the recent launches in the UK, the group has been rolling out in Madrid and Barcelona during the third quarter. With the abovementioned contracts and geographies scaling up and additional new contracts yet to be signed, we expect continued triple-digit sales growth in H2’22e. However, new cities come with start-up costs and a gradual ramp-up in volumes. As such, we expect a cash outflow of SEK 74m during the same period and a share issue of SEK 100m during Q3’22e.

Transfer of analysts results in significant est. revisions
As we are currently transferring analysts, we have made significant revisions to our forecasts. Due to a slower e-commerce market coupled with weakening purchasing power among consumers, we trim our sales estimates by 7-17% (‘22e-‘24e). Consequently, we expect ...
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