Atria: Strong Q4 driven by Finland, dividend proposal above expectations - Nordea

Atria reported Q4 adjusted EBIT of EUR 16.7m, 39% above our estimate (no quality consensus available). Q4 net sales of EUR 451m were up 12% y/y and came in line with our estimate. Adjusted EBIT beat was fully driven by Finland, while other segments came below our estimates. Atria’s market position has improved in Finland, Sweden and Estonia, while it has lost some market shares in Denmark during 2022. Producer prices have remained significantly above last year level. Q4 reported EBIT included EUR -51.1m of items affecting comparability, related to impairments in Sweden. Q4 operating cash flow was EUR 74m (EUR 46.3m a year ago). Dividend proposal stands at EUR 0.70 versus consensus of EUR 0.63. Atria’s outlook for 2023 expects adjusted EBIT to decline from 2023 (after EUR 49m in 2022) while we have modelled EUR 48.7m or 1% decline (Refinitiv consensus EUR 47m, or 4% decline). We note that Atria issued a similar guidance for 2022 and ended up EUR 0.2m below 2021 level in 2022. During 2023, the company will commission a major expansion at its Sköllersta plant in Sweden, and the phased start-up and testing of the new poultry plant in Nurmo will begin. These measures will result in additional costs in 2023. We believe consensus revisions to be muted while we note dividend proposal that came above expectations. We have a fair value range of EUR 12.2-14.9 per Atria share.