Favourable weather, but tough markets
We believe that weather effects have been generally favourable during Q1, and should partly offset lower activity in landscaping and construction (45% of sales), fewer working days and tough comparables. We therefore expect a 4% organic sales decline (-4% in Sweden, -4% in Norway, -8% in Finland/Rest of EU), vs. -6% in Q4, before gradually returning to positive growth in Q4 (+2%). The solid M&A activity has continued, most recently with a sizeable acquisition in Germany (we estimate a 3-4% addition to EBITA). We believe this could hold back further M&A activity somewhat in the near term, given the reported (pro forma) gearing of 2.5x by Q4'23, in line with its target. For Q1, we forecast sales of SEK 1,246m, flat y-o-y, and an adj. EBITA of SEK 79m, -9% y-o-y (-22% organically), for a margin of 6.3% (6.9%), due to normalised margins in Norway and a still-challenging market in Sweden. Finally, we expect timing effects of payments to yield strong cash flow (lease adj. FCF >100% of EBITA).
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