The Q2 2025/26 results confirm Gabriel's continuing operations are resilient in a challenging market, though the headline is weighed down by a steeper-than-expected FurnMaster revenue decline. Management's decision to maintain full-year continuing operations guidance of revenue MDKK 510-550 and EBIT MDKK 40-55, despite a softer Q2 in Europe and Asia, signals confidence in a stronger H2 as investments in new key account managers begin generating returns. Gross margins remain strong and the balance sheet is in its best shape in years, supporting the ongoing share buyback programme. We maintain our recommendation of "Accumulate" with a adjusted target price of DKK 280 per share, though we revise group estimates lower primarily on FurnMaster. 

Guidance maintained despite softer Q2 as gross margins and sales investments underpin H2 confidence 

Continuing operations revenue declined 2.9% y/y to MDKK 134.1 in Q2 (Q2'25: MDKK 138.1), a deceleration from Q1's 4.7% growth, bringing H1 to MDKK 263.3 (+0.7% y/y). Management attributes the softness to deteriorating conditions in Europe and Asia, while North America maintained a positive trend. The maintained guidance implies H2 acceleration, which we see as credible given the investment in additional key account managers throughout H1 whose revenue contribution typically lags by two to three quarters. The Q2 gross margin of 55.0% improved sequentially from 54.3% in Q1, demonstrating continued pricing discipline with large global clients. Continuing operations EBIT margin reached 10.1% in Q2, a strong level despite the revenue miss.

FurnMaster revenue miss significant but EBIT impact contained - break-even pushed to FY 2026/27 

FurnMaster revenue declined 36% y/y to MDKK 70.8 in Q2, below our HCA estimate of MDKK 86.3, as the termination of unprofitable contracts progressed faster than anticipated. The EBIT impact was contained at MDKK -3.6 (Q2 2024/25: MDKK -1.2), reflecting that terminated contracts were low-margin. No transaction update was provided, suggesting Gabriel is awaiting the right buyer rather than pursuing a fire sale, a disciplined approach we view positively even if it extends the timeline.

Strengthened balance sheet supports buybacks and positions for growth investments

With NIBD/EBITDA LTM at approximately 3.6x, financial gearing is increasingly becoming a lesser concern. As deleveraging continues we expect Gabriel to have growing capacity to invest more heavily in the business, underpinning the earnings growth acceleration we forecast for 2027e and 2028e, while the initiated share buyback programme signals management's confidence and a renewed focus on shareholder returns.

Estimates revised lower on FurnMaster but valuation favours positive risk/reward 

We revise FY 2025/26e group revenue approximately 10% lower to ~MDKK 794, driven predominantly by the steeper FurnMaster decline, with a modest reduction to continuing operations. FY 2025/26e group EBIT is revised ~5% lower to ~MDKK 39.8, as the FurnMaster revenue miss is partially offset by the low-margin nature of terminated contracts. Medium-term revenue growth for FY 2026/27e is moderated on a slower market recovery, though margin assumptions are broadly unchanged. Current valuation multiples compress meaningfully in the forward year and continue to support a positive risk/reward at the current share price.

Disclaimer: HC Andersen Capital receives payment from Gabriel for a DigitalIR and research agreement. /Rasmus Køjborg and Victor Skriver 08:00 11/05/2026