We find the 5% organic growth in Q1, and sales +3% vs ABGSCe, to be a solid start to the year demand wise, while the gross margin fell just short of our expectations (20.9% vs ABGSCe of 22.0%) and, in combination with SEK 3m higher opex in the quarter, adj. EBITA came in -8% (SEK -5m) vs our expectations. The lower gross margin was a result of a few larger deliveries with lower margins, and we think that the pricing risk in the orderbook remains low and locked in both on the customer and the supplier sides. Proact enters a period with easy comps from weak system sales in 2021 (Q2-Q4’21 declined organically between -16% and -24%), which should give us an accelerated organic growth trend ahead. With organic opex under control and sales contribution from acquisitions, we estimate that Q2-Q4 adj. EBITA will grow 13% to 48% in the coming three quarters.
Small estimate revisions
With Q1 coming in relatively in line with our expectations, we make small adjustments to our estimates ahead and find ourselves raising sales by 1%, adj. EBITA by 1-2% and reducing EBIT by -1-3% (due to higher amortisations) in 2022e-2024e.
Continues to trade below peers
On our revised estimates, the share is trading at 8.0x EV/adj. EBITA in 2022e, which is 38% below our peer group. This is likely a result of the lumpy nature of the business, with volatile development in both organic growth rates and profitability.
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