Ferronordic - Record Q1 EBIT of SEK 80m
Q1 EBIT SEK 80m, 1% vs. ABGSCe EBIT margin of 6. 3% (ABGSCe 6. 4%) ~7x EV/EBIT ’21e, 7-12% lease adj.
FCF yield ’21-’23e Q1’21 outcome: record Q1 EBIT of SEK 80m Group sales of SEK 1,267m (3% vs. ABGSCe at SEK 1,234m and 9% vs. Cons at SEK 1,165m), up 13% y-o-y, of which organic 54% (ABGSCe 28%).
Group EBIT came in at SEK 80m (1% vs. ABGSCe, 23% vs. Cons), for a margin of 6.
3% (ABGSCe 6. 4%, Cons 5. 6%), up from 4.
6% in Q1’20. Sales of new units were in line with ABGSCe at +30% y-o-y, mainly driven by market recovery, leading to pent-up CE demand materialising in Russia/CIS during Q1. EBIT was the highest of any first quarter, with costs declining in tandem with higher sales volumes, with a negative contribution of SEK -14m from Germany.
Estimate changes and outlook Based on Q1 numbers alone, we expect to make slight positive EBIT revisions, likely 1-2% for ’21-’22e. Business outlook remains somewhat uncertain in the short-term, mainly due to concerns regarding supply chain constraints, but long-term outlook remains positive due to high commodity prices and increased activity on national projects in Russia/CIS. Share price thoughts and conf call details The share is up 26% L3M, partly helped by the newly announced (Q1’21) M&A in Germany.
On our current estimates, the share is trading at c. 7x ’21e EV/EBIT, while offering 7-12% lease adj. FCF yield ’21-’23e.
The company will host a conference call at 10:00 CET, dial-in SE: +46 8 505 583 50, UK: +44 333 300 92 66. The presentation can be followed via live stream at: https://tv. streamfabriken.
com/ferronordic-q1-2021.
