Boule Diagnostics - Feedback from ABGSC Investor Day

Investment highlights provided by CEO Mr. Söderqvist Underlying progress to be visible when demand returns Entering an intriguing period of growth from H2’21 Market recovery likely during H2’21 Today, we hosted a presentation with Boule Diagnostic’s CEO Jesper Söderqvist at our ABGSC Investor Day seminar. Regarding current trading, we got the impression that there are still short-term uncertainties, with testing volumes remaining low, and that the recovery is likely to begin in H2’21. However, Mr.

Söderqvist gave us the impression that Boule will be well prepared to seize any opportunities that arise when markets open, highlighting increased digital marketing and enhanced support to its distributors as two opportunities. Another highlight was the discussion regarding its new hematology product platform, which it expects to launch by the end of 2022. The first release will be an advanced 5-part human instrument, which would give Boule a broader and more competitive product portfolio, as well as better targeting the 5-part market, which is growing by 8% p.

a. (vs. 3% for 3-part).

Plenty to suggest that profitability will improve Almost a year has passed since Mr. Söderqvist took over the reins, and while market conditions could have been better, we believe Boule has made good underlying operational progress amid these unprecedented times. Implementing new digital ways of working, e.

g. within sales and training, Boule could well have a more competitive cost base and better operating leverage when demand returns. Also, its installed base of ~29,000 instruments provides comfort for coming years’ Consumable sales when testing volumes return.

Here, we also expect a favourable product mix to be supportive for margins already by mid-2021. Share has remained weak – ’22e EV/EBIT of 13x The share has remained weak during the first few months of 2021 and is down c. 7%, underperforming the SX20PI by 8 p.

p. We continue to believe that Boule is go.