Q4 largely in line, Q1 likely flat
StrongPoint delivered a Q4 largely in line with our expectations, but the market continues to be affected by postponements/long decision cycles. Sales increased 3% y-o-y, an improvement vs. -7% on average over the last 4Q, but note that comps were easy. Total revenues were NOK 340m, +3% vs our NOK 331m. Revenues from Norway were up 4% while revenues from Sweden were up 19% y-o-y. GP was -1% vs. our estimate, giving a GM of 39.4% (ABGSCe 41%). Adj. EBITDA came in at NOK 5m (ABGSCe NOK 6m), down vs. NOK 12m in Q3, but up vs. NOK -3m in Q4'23. EBITDA has been supported by cost cuts, but these effects are fully visible now and no more cuts have been announced. The company remains cautious about promising significant short-term improvements (uncertainty high). We expect Q1 to show similar trends as Q4, with EBITDA likely flat q-o-q. The company had disposable funds of NOK 103m in Q4 (NOK 83m in cash, NOK 20m in RCF), an improvement vs. NOK 61m in Q3. We reiterate that it should have sufficient funds short term, but it may be more challenging medium term if the market situation persists.
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