Midsona’s Q4 report was very soft, as had been communicated beforehand. Sales came in at SEK 1,012m and adj. EBITDA came in at SEK 61m. While sales came in relatively in line with expectations, the EBITDA came in well below. While a soft y-o-y performance was expected due to extraordinarily tough comps, the adjusted EBITDA declined 46% y-o-y, with the gross margin being an important explainer to the weak result. The adj. gross margin declined from 28.1% to 23.9% y-o-y on the back of the high spot price purchasing to secure supply. All-in-all, given that the results were pre-announced, the Q4 report should not render out in any major cons. revisions, with the new information today being the different profitability-improving measures discussed below.
Actions in place to reverse the negative trend
Looking forward, Midsona leaves a rough 2021 behind, with a negative organic growth of 6% for the full-year, and an EBITDA margin decline of 2.2pp. to 8.3% from last year’s 10.5%. Midsona cites a couple of actions to reverse the negative trend seen throughout the year. Firstly, the company reiterates the undergoing price hikes, that will be in full effect from Q2’22, already hinting about a rough Q1 in terms of margins. Adding to this, the company does not rule out further price hikes. Another action the company is mentioning is “other profitability-improving measures” to improve supply chain reliability and stabilise pricing. What these actions mean more in detail are not stated.
Removed divi all in line with expectations
Midsona proposes no dividend for FY’21, which is all in line with expectations given the company’s current balance sheet. The company further states that it has initiated programs to reduce tied up capital. We hope to get more detailed explanations on the actual impacts of the different measures mentioned ... Läs mer på Introduce
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