Precise Biometrics - No surprises in Q1’21 for Precise
Q1’21 EBITDA SEK 0m vs. ABGSCe SEK 0m Estimates intact but cost composition adjusted Adjust DCF fair value to SEK 0. 76-2. 77 (0.
72-2. 75) Q1’21 in line with ABGSCe with sales growth of -11. 9% y-o-y Precise Biometrics’ Q1’21 report was mainly in line with our estimates, both on sales and EBITDA.
Net sales amounted to SEK 20m, +3. 1% vs. ABGSCe, for y-o-y growth of -11.
9%, mainly driven by lower royalty revenues on a y-o-y basis, as the component shortage among Precise’s customers resulted in lower production values. During the quarter Precise continued to add new customers and installations to its Digital Identity segment (YOUNiQ to be installed at Science Village in Lund and integrated with Sensative’s Yggio platform). The Digital Identity segment generated revenues of SEK 0.
5m in Q1’21. The largest deviation to our estimates stemmed from a lower gross margin than expected, 77. 4% vs.
ABGSCe 84. 2%. This was mainly due to increasing D&A and write-downs of capitalized development expenses, and product mix.
Operational costs were SEK 20m, -1. 9% vs. ABGSCe, where R&D expenses were lower than expected due to an increasing part of development work for Digital Identity being capitalized.
Ultimately EBITDA amounted to SEK 0m, in line with ABGSCe at SEK 0m. Estimates intact, component shortage to pressure Q2’21e Our estimates remain largely intact following the Q1’21 report. However, we make changes to the cost composition following the increasing D&A and capitalization of development work associated with Digital Identity, which pressures the gross margin but lowers operational costs.
For Q2’21 we expect the global component shortage to continue to pressure royalty revenues, as production volumes remain subdued. DCF fair value SEK 0. 76-2.
77, EV/sales 4. 1x-3. 2x ’21e-’23e Following our estimate changes we make slight adjustments to our DCF fair value range, which now indicates SEK 0.
76-2. 77 (0. 72-2.
75) per share. Additionally, we find that at the current share price, P.
