Bergs Timber Q2: Sequential improvement - ABG

Q2e EBITDA of ~SEK 140m Sawn goods prices up ~15% in Q2, could weaken in H2 Trading at EV/EBITDA 4x for ’22e and 5x for ’23e/’24e Q2e EBITDA of ~SEK 140m
We estimate Q2’22e EBITDA of ~SEK 140m, up from SEK 82m in Q1’22 and somewhat in-line y-o-y (SEK 146m in Q2’21). The sawmills will likely fare better q-o-q driven by better volumes and ~15% higher prices. Wood protection prices will likely follow, and we expect an improvement in the segments’ margins q-o-q due to higher prices, lower raw material costs (due to lag) and seasonally stronger volumes. Note that the US lumber price has dropped ~55% since March and the direction for sawn goods could be down in H2. Key sawn goods indicators have shown weakness lately: inventories levels have risen, and new orders have declined. Bergs Timber will report its Q2 numbers on 25 July. We raise our ’22e EBITDA by ~7%, driven by our expectation of better results in Q2. Our ’23e/’24e EBITDA is up 2-3% due to the recent acquisition of Pinus.