Urb-it’s Q4 report came in slightly above our sales expectations, but below our EBIT estimates. More specifically, Urb-it grew sales with 274% y-o-y to SEK 16m (+10% vs ABGSCe). EBIT continued to decline to SEK 43m, which is a drop by 219% y-o-y, and 54% below our expectations. For the FY’21 Urb-it reports sales of SEK 34m, translating into a growth of 173% y-o-y, where Q4 constitute 47% of the FY sales.
… but growth story should continue from here
In line with our expectations the ramp-up of sales in the quarter was driven by a volume hike following the partnership signings and an increased demand during the holiday season. In all, Urb-it showed its highest ramp-up in deliveries so far, growing sales with 114% q-o-q. However, as we feared, EBIT was hampered by an increased cost base. The increased cost base stemmed from lock-down related disruptions in France and the UK affecting the availability of couriers, meaning that Urb-it had to choose other, more costly, alternatives to ensure its deliveries. This is also reflected in the cash flow, where SEK 2.7m in the quarter was spent on strengthening capacity. Although EBIT continued to decline, and in this case foremost due to short-term lockdown disruptions, we take a positive view on that Urb-it prioritized to take care of its partnerships, which we think is key in this stage of its growth journey.
Currently trading at EV/Sales 5.3x-2.4x in ‘22e-‘23e
The Urb-it share is -19% YTD and is on our unrevised estimates trading at EV/Sales of 5.3x-2.4x in ‘22e-‘23e. On the back of the report today, our ‘22e estimates mechanically comes up by 1% on sales and down some 20% on EBIT.
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