• Sales +24% and EBIT +52% vs. consensus
• Strong quarter with record-high turnover and profit
• Outlook remains unchanged, strong demand

Q1 results

Sales came in at SEK 38m (+20% vs. ABGSC 32m, +23% vs. consensus 31m), +24% y-o-y (+34% organic). EBIT was 9m (+49% vs. ABGSC 6m, +52% vs. consensus 6m), and adj. EBIT was 10m (+70% vs. ABGSC 6m, +74% vs. consensus 6m) for a margin of +27% (ABGSC +19%, consensus +19%). Adj. net income was 9m (+65% vs. ABGSC 6m, +58% vs. consensus 6m) for a margin of +25% (ABGSC +18%, consensus +19%). The company produced lease adj. FCF of 14m, +33% y-o-y. The profit was slightly offset by elevated costs linked to the EU regulatory process, which amounted to SEK 1.3m (~25% of external costs). Overall a strong quarter, where turnover and profit amount to the highest ever in the company's history, and which clearly demonstrates that the underwhelming Q4 revenue was indeed a temporary dip.

Estimates and outlook

We expect consensus will raise '24e-'26e sales by 4-5% and adj. EBIT by ~10%. Outlook remains unchanged, with continued interest in Selektope. During the quarter a new customer (PPG) launched Selektope-paint for the global market, bringing the total number of customers with products on the market up to 4 out of ~9 relevant customers, providing further support for '24e-'26e sales, with management stating that the new product is "already making a footprint in the turnover".

Valuation

The share is down 8% L3M (vs. OMXSPI +9%) and is currently trading at 13-6x '24e-'26e EV/EBIT or 19-10x '24e-'26e P/E on our pre-report estimates. The company will host a presentation of the Q1 results at 10:30 CEST.