GOMspace - Solid order intake, engineer staff increases
Component shortage has negative impact on Q2’21 FY’21 guidance reiterated at revenues of SEK 245-270m Fair value range reiterated at SEK 11-54 Component shortage squeezes sales and margins During Q2’21, GomSpace has seen negative pressure from the lack of certain components. This component shortage is delaying delivery times and is unproportionally affecting the delivery of high-margin products more than that of low margins products. We have therefore seen a modest sales increase in Q2’21 of 11% (vs. ABGSCe 46% and FactSet cons.
30%) and in the gross margin improvement which came in at 14% (ABGSCe 31%, cons. 33.5%). FY’21 guidance reiterated, but skewed towards low-end While Q2 saw negative headwind from the component shortage, the FY’21 revenue guidance of SEK 245-270m (ABGSCe SEK 251m vs.
cons. SEK 239m) has been reiterated, indicating a back-end loaded FY’21. The company, however, mentioned that due to the ongoing uncertainty of component sourcing throughout FY’21, guidance is skewed towards the lower end.
Engineer staff increases due to order backlog strength Order intake during Q2’21 was solid; new orders were SEK 199m (SEK 42m in Q2’20 and fueled by the ~SEK 147m Indra order). Thus, total backlog was SEK 338m. Backlog is comprised mainly of the commercial (~56%) and science (36.6%) segments, with the academia segment usually having shorter order cycles (meaning it would normally not account for a large part of the total backlog orders).
In light of this, GomSpace has started to increase the number of engineers on staff to help simultaneously facilitate existing orders and manage expected continued growth. It is also worth noting that the number of cancelled orders in Q2 was incredibly low, supporting continued credibility in the order backlog strength. Hence, we slightly lower our sales and gross margin improvements for FY’21e, but increase ’22e-23e sales estimates a bit on the back of strong order backlog.
Our fair value range remains intact at....