Vestum: - 2% adj. EBITA miss on lower org. sales - ABG

Sales 0%, adj. EBITA -2% vs. cons, -4% org. sales
Cons to lower '24e EBITA by 1-3%
Strong cash flow but slower organic momentum


Q1 details

Decelerating organic growth but strong cash flow. Sales came in at SEK 1,240m (-1% vs. ABGSCe, 0% vs. FactSet cons.), -11% y-o-y (-3% vs. restated figures) of which -4% organically (ABGSCe -3%, cons +3%, +1% Q4'23). Adj. EBITA grew 4% y-o-y (-16% vs. restated figures) to SEK 100m (-13% vs. ABGSCe, 2% vs. cons), for a margin of 8.1% (ABGSCe 9.2%, cons 8.3%, 6.8% Q1'23). Solid performance in Water while sales and margins declined y-o-y in Services and Infrastructure due to weaker market demand, increased competition and timing of projects. FCF was strong at ~150% of adj. EBITA (~100% in Q4) while gearing came down q-o-q to 2.7x (2.8x) and 2.4x excl. earn-outs (2.6x). Looking ahead, the CEO sees signs of increased demand towards H2'24, still good demand in Water and that there are good opportunities to grow the Water segment further through acquisitions, mainly in the UK market.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/vestum/Equity-research/2024/5/vestum---2-adj.-ebita-miss-on-lower-org.-sales/