Inission: Record orders and a 15% earnings beat - ABG
* Orders +62% y-o-y and +50% vs. ABGSCe for 1.5x b-t-b * EBITA adj. of SEK 49m, +15% vs. ABGSCe * Broad-based strength behind earnings beat
ANNONS
Q3 results
Orders were up 62% y-o-y and 50% above our estimate, taking the order backlog to a record SEK 1,903m (+34% y-o-y). Management partly attributes the 1.5 b-t-b to larger customers placing orders with longer lead times. Sales grew 18% y-o-y (of which 18% organic) and were 8% above our estimate. With a margin of 7.8%, 0.5pp above our estimate, EBITA adj. was 15% above our estimate. EMS margin was flat at 7.8% (7.7%) despite 14% growth, as component cost increases have not been fully passed on. Lease adj. FCF was SEK -21m on a SEK 74m working capital build, mainly inventory. Inission Power (Enedo) grew 40% organically with an EBITA margin of 7.4% (-7.4%), its third consecutive quarter of positive EBITA and close to EMS levels. There is a conference call at 09:00 CET: webcast
Estimate changes
The Q3 numbers in isolation imply EBITA adj. +4-3% for '26e-'27e. Inission raised its FY’26 guidance of SEK 2,300-2,500m to 2,600-2,700m (ABGSCe 2,649m) prior to the report (margin target unchanged), following an improved order intake during the quarter. This implies Q4 sales of SEK 675-775m (ABGSCe Q4'26e: 767m). Management also delivered on its target of completing an acquisition before YE'26, entering the German market through the acquisition of BDT. Management sees strong demand in defence and data centre, as well as increased demand in industrial and electrification.
Company valuation
Over the past three months, the share has returned 8%, compared to the Nordic EMS peer median of 9% and the +5% of the OMX Stockholm Allshare. The share is currently trading at 13-9x '26e-'28e P/E, compared to peers at 17x-13x.
