CBTT delivered sales 1% above our expectations at SEK 181m, up 13% y-o-y whereof 4.5% organic (ABGSCe 3.7%). The y-o-y growth was driven by high activity within Process Equipment, Technical plastics, and Service, whereas the Materials Technology segment was flat y-o-y. The gross margin held up well at 40.3% (41.7%) vs. ABGSCe 39.3%, due to a favourable business and products mix. Thus, adj. EBITA (SEK 2.3m in adjustments from restructuring and recruiting) was 12% better than expected, at SEK 8.5m, corresponding to a margin of 4.7% (4.8%) vs. ABGSCe 4.2%. Lastly, the order intake continues to be strong, up 28% y-o-y whereof 18% org.
Estimate changes and outlook
On isolated numbers, estimates will remain fairly intact. Management expects to see continued negative impact from longer lead times and cost inflation going ahead and mentions that CBTT may experience some indirect effects from the Russian invasion of Ukraine, if shortages of steel products and energy affect its suppliers. However, management also sees that underlying demand remains stable and that: “we consider the strong order intake we experienced in the first quarter will guarantee positive development during the rest of the year”.
Final thoughts
The share is down ~27% YTD and is trading at 10-8x ‘22e-‘23e EV/EBITA on our pre-report estimates and yesterday’s closing price. As of tomorrow, Caroline Reuterskiöld (prev. from Lagercrantz) will take over as CEO. Additionally, on 11 April, CBTT announced its new CFO, Henrik Nordin, who will take over from current interim CFO Lars Westlund, preliminary as of 15 August. Mr Westlund has long experience from both global corporations as well as more entrepreneurial companies, with a large experience of M&A. He is currently the CFO of Infrea.
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