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Third party research

Inission: Peers performed poorly in Q2 - ABG

Inission

This is a third party research report and does not necessarily reflect our views or values

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Q2e: EMS industry under pressure; Inission should fare relatively well
'24 sales target challenging without further M&A, but margin doable
1.0x le. adj. ND/EBITDA: M&A possible, and market looks favourable


Q2e: Weakening demand within Nordic EMS space

All five Nordic EMS peers have already reported Q2 results, with organic sales declines ranging from 8 to 20% and operating margin contractions ranging from 0.2pp to 2.9pp. For Inission, we forecast sales of SEK 560m (-0.4% y-o-y, -3.5% organically) and an EBITA margin of 6.8% (7.3%). There is a clear weakening demand trend in the EMS space, but for Inission the pace of the decline has been less dramatic than for some peers (likely at least in part due to fewer small hyper-growth companies among its customers). This, in combination with relatively easy Q2 sales comps in the Inission segment, informs our smaller organic sales decline est. compared to peers.
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