Studsvik - Year-end brings underlying improvement
Non-recurring events cloud a solid Q4 F&MT continues to win large orders Ongoing management changes Q4: Adj. EBIT -13% vs ABGSCe, but 3 of 4 segments above Studsvik reported Q4 net sales of SEK 214m (203m), which was 13% above ABGSCe. The deviation from our estimate mainly stems from Waste Management and Decommissioning & Radiation Protection Services (prev. Germany).
On the negative side, Scandpower continues to struggle for growth and was behind our assumption. Adj. EBIT was SEK 9.
8m (20. 4m), vs. ABGSCe at SEK 11.
3m. The decline from the previous year is explained by Scandpower, which experienced unusually high demand in Q4 ’19. The EBIT was negatively affected by Waste Management and higher group costs.
However, the other three segments surprised positively on EBIT margins. Waste Management had a larger license sale but didn´t recognize the EBIT effect as a precaution due to COVID-19 risks. New orders from Russia and Norway Fuel & Material Technology (F&MT) continues its recent momentum and followed up the orders from China and South Korea with new large orders from Russia and Norway in January.
The Russian order with TVEL, effective in 2021-2022, has a total order value of SEK 100m. The Norwegian order with IFE is a confirmation of the ongoing discussions since the summer of 2020. It will be effective from 2021 until 2033, with peak sales between 2022 and 2024.
The total order value is SEK 134m. We raise our sales estimates following the new order intake, despite another postponement of the Elekta order ramp-up. EBIT estimates are raised further following higher margin assumptions in Decommissioning and F&MT.
The CEO shifts focus to Scandpower In a rather hectic January, Studsvik announced a new head of Decommissioning and the departure of the CFO Claes Engwall and the head of Scandpower. Processes to find suitable replacements have been initiated. In the meantime, CEO Camilla Hoflund will shift her focus from Decommissioning to temporarily be head.
