Enzymatica - Normal cold season expected in 2022 - ABG

Sales comeback lingers on continued destocking Cold season is getting back to a normal pattern We forecast a ’19-‘24e sales CAGR of 32% Higher customer inventories held back a recovery in Q4 Enzymatica reported Q4 sales of SEK 18.7m (-56% y-o-y), which was below our expectations (ABGSCe of SEK 26.6m). The Swedish cold-remedy market is improving but declined 6% for the full year, but Enzymatica’s sales to the Swedish pharmacy segment were only down by 2%. This channel was almost back to 2019 levels in Q4 (+27% vs. Q4’20), but partner sales are lagging as customers are focused on reducing their inventory from high levels. The higher own sales contributed to the strong gross margin in Q4, coming in at 68% (Q4’20 was 61%). Opex was lower than we expected, hence EBIT at SEK -10.5m (ABGSCe SEK -6.2m) held up relatively well despite the lower sales. Coldzyme’s market share in the Swedish cold remedy market declined for the full year but improved in Q4 and the company maintained its domestic position as the third largest cold remedy and the largest relief product. Poised for a reopening recovery With vaccination rates reaching high levels across the world and each new wave getting seemingly milder, it seems like the pandemic is drawing to a close. As restrictions are lifted, communicable diseases are likely to return to their normal patterns, benefitting demand for cold remedies. Together with its partners Sanofi and Stada, Coldzyme was launched in three new markets in Q4 ‘21, as well as gaining approval in the quite sizable markets of Mexico, Canada and Turkey. Hence, Enzymatica looks well positioned to grow out of the pandemic. Destocking gets better after Q1 – normalised next cold season We believe customer destocking will continue to negatively impact sales in Q1 ‘22. Thereafter we assume a relatively normalised cold season for 2022/23, with Enzymatica set to benefit from partner ramp-ups in 30 launched markets. We update our estimates accordingly, leading to 15-3% cuts to ... Läs mer på Introduce