Pipeline may be underappreciated
Order book and pipeline potential in excess of DKK 20bn
Today, we hosted MTHH’s Q2\22 investor meetings in Copenhagen. Presenting the company were CEO Henrik Mielke and CFO Martin Solberg. The company once again elaborated on its order book (DKK 12bn at end-Q2’22) and, importantly, the pipeline of potential new orders stemming from the company’s partnership agreements. This pipeline currently has a value of DKK 9-12bn, of which DKK 2.8bn are comprised of orders that have been awarded but not yet contracted and of these DKK 2.8bn, approximately DKK 1.3bn have been announced as orders during August 2022. All told, the combined value of the company’s order book and pipeline is in excess of DKK 20bn. As the market is cautious about translating the pipeline into new order inflow, a successful realization of the company’s partnership model over the next 2-3 years represents, all else equal, a source of potentially significant upside, as we see it.
Lower risk from partnerships and sector exposure
In light of the current market situation, the company highlighted its partnership model and pipeline as a particular company-specific strength. While the company has seen a slowdown in newbuild activity (private and public housing) the company sees growth in pharmaceutical/biotech sector and management furthermore highlighted that, relative to 2007, the company has a lower risk orderbook which to a certain extent is driven by higher exposure to infrastructure projects.
Less than 5% of revenues, but volatile earnings annoy
Although Scandi Byg comprises less than 5% of revenues, but the volatility in earnings led to a discussion about the role of MTHH as the right owner of this unit. While management stated that ownership of Scandi Byg is evaluated regularly, we sense that the unit’s sustainability profile is important from a strategic/ competency perspective. Ideally, Scandi Byg revenues need ... Läs mer på ABG Sundal Collier
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