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Tempest Security: Busy newsflow bodes well for 2024 - SEB

We raise 2024E-25E adj. EBITDA by 1.3-6.1%, driven by several recent new contracts with a total annual value of c. SEK 70m. Security Services is experiencing a surge in demand, especially in Sweden, and Tempest is clearly benefitting. We believe 2024 could be a year of robust growth and margin expansion: we forecast organic growth of 11% and a 40bp adj. EBITDA margin improvement, to 5.8%. DCF-based value mid-point up to SEK 27 (24).

We raise 2024E-25E adj. EBITDA by 1.3-6.1%, driven by several recent new contracts with a total annual value of c. SEK 70m. Security Services is experiencing a surge in demand, especially in Sweden, and Tempest is clearly benefitting. We believe 2024 could be a year of robust growth and margin expansion: we forecast organic growth of 11% and a 40bp adj. EBITDA margin improvement, to 5.8%. DCF-based value mid-point up to SEK 27 (24).
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