Ferronordic: Germany likely stagnant, but US strong - ABG
This is a third party research report and does not necessarily reflect our views or values
Q4e: Germany likely stagnant, US solid
12-9x '25e-'26e EV/EBIT, distributor peers at 14-13x
De-leveraging in focus, then US expansion
Q4e: Germany likely stagnant, solid quarter in the US
We expect Ferronordic to report Q4 sales of SEK 1,223m and EBIT of SEK 28m, of which 59m is from the US, -12m from Germany, and -20m from Kazakhstan and group costs. On a sequential basis, we expect an earnings uptick in the US on positive seasonality, as Q4 typically sees many rental conversions. Meanwhile, in Germany, we have estimated fairly flat EBIT on a sequential basis (adjusted for the inventory write-downs in Q3), as the company's cost-cutting measures in Germany are now largely finished. Finally, we highlight that there has been some quarterly volatility on group costs, but given the average quarterly cost base, this should weigh somewhat on earnings compared to Q3, when costs were lower than usual.
12-9x '25e-'26e EV/EBIT, distributor peers at 14-13x
De-leveraging in focus, then US expansion
Q4e: Germany likely stagnant, solid quarter in the US
We expect Ferronordic to report Q4 sales of SEK 1,223m and EBIT of SEK 28m, of which 59m is from the US, -12m from Germany, and -20m from Kazakhstan and group costs. On a sequential basis, we expect an earnings uptick in the US on positive seasonality, as Q4 typically sees many rental conversions. Meanwhile, in Germany, we have estimated fairly flat EBIT on a sequential basis (adjusted for the inventory write-downs in Q3), as the company's cost-cutting measures in Germany are now largely finished. Finally, we highlight that there has been some quarterly volatility on group costs, but given the average quarterly cost base, this should weigh somewhat on earnings compared to Q3, when costs were lower than usual.