Q1’21e: cash EBITDA of EUR 56m, +17% y-o-y Full-year capex for 2021 estimated at ~EUR 240m Cash EBITDA chg. : -4% ’21e, -2% ’22e and -1% ’23e Cost reduction programme could potentially be presented In its Q4’20 report, Axactor announced the initiation of its cost reduction programme as part of its new strategy where focus has shifted from scale first to increasing return on equity. In addition, the results of this initiative are expected to be presented during H1’21, according to the company. The effects of these initiatives could be presented in the Q1 report and we think that there are likely some restructuring costs associated with these, while the savings are likely to come after Q1.
We have not factored any savings into our estimates, hence these will likely represent a positive delta to estimates and valuation. Q1 is normally a seasonally slower quarter than Q4 and we estimate cash EBITDA at ~EUR 56m, down 12% q-o-q but up 17% y-o-y, driven by gross revenues down 6% q-o-q (lower collection and 3PC revenue) and flattish opex. Deal activity to pick up during H2’21, likely slow in H1’21 Having looked at announced transactions in the market, our impression is that deal activity is still slow in the NPL market, but expect it may pick up materially in H2.
For Axactor, we assume a capex level in Q1 close to forward flow levels at EUR 14m with only limited discretionary volumes. To better account for the still-slow deal activity, we back-end load capex estimates slightly and estimate a total capex level of EUR 240m for 2021, down 14% from our previous estimate. Capex is still meaningfully up from EUR 208m in 2020, while 2022 and 2023 are expected to be busier in terms of activity.
Estimated fair value range of NOK 8. 8-24. 1 based on DCF In sum, cash EBITDA is down 4% for ’21e, 2% for ’22e and 1% for ’23e, due to lower capex, slightly lower collection and a 1pp lower cash margin due to more flattish opex q-o-q in Q1.
Based on our current estimates and accounti.
