Nolato - Better guidance for Integrated solutions

EBITA +3% vs. ABGSCe, +1% vs. cons Estimate should come up 2-3% on guidance 18x EBIT, 40% discount to compounders Numbers in line Sales SEK 2,645m (-1% vs ABGSCe 2,661m, -1% vs. Infront cons 2662m) 22% organically (ABGSCe 15%).

Nolato expects VHP volumes to grow and sees sales for this business area increasing by around 15% in the second quarter compared with the first quarter of the year. We have 7% q-o-q. Adj.

EBITA SEK 308m (+3% vs ABGSCe 298m, +1% vs. cons 304m), on margin of 11. 6% (ABGSCe 11.

2%, cons 11. 4%). Net Income SEK 226m (1% vs.

ABGSC 224m, 0% vs. cons 225m) Upgrades on better Integrates solutions guidance On our figures the Q1 results alone would imply revisions of +1% on EBITA. But the guidance for VHP products is better than expected and we think it should add another 1-2% on positive estimates revisions.

Additionally, we think consensus estimates for Integrated solutions are too low and would likely have to come up by c. 4% ’21e and c. 12% for ‘22e, implying 5% positive revisions on ‘22e group EBITA.

Share could come up 2-3% on the guidance Trading at 18x ‘21e EV/EBITA, in the middle of our fair value range of SEK 800-870 per share. Nolato has similar financial performance to Lifco, both with 17% EBITA CAGR over the last 10 years, but Nolato is trading at c. 40% discount.

The share is down c. 3% now but we expect it to trade up to almost flat for the day. More information expected during conference call at CET 15.

45 Dial-in: SE: +46 850 558 351 UK: +44 333 300 90 34 US: +1 833 526 83 95 Webcast: https://tv. streamfabriken. com olato-q1-2021.