B3 Consulting Group: Margin beat on cost cuts - ABG
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* Sales -9% but adj. EBITA +7% vs. consensus
* Margin improvement supported by cost efforts and Habberstad
* Consensus EBITA estimates likely down by mid single-digits
Q4'25 report
B3 reported Q4'25 sales of SEK 315m (-8% vs. ABGSCe 343m, -9% vs. FactSet consensus), representing an organic decline of 14%. The decline was primarily driven by fewer B3 consultants and subcontractors. Two, slightly offsetting factors were higher hourly prices and utilisation rates. Adj. EBITA came in at SEK 17m (+8% vs. ABGSCe 16m, +7% vs. consensus), representing a margin of 5.4%, which was better than we expected, but it was also cost-driven. More specifically, it was due to lower overhead costs in Sweden.
Thoughts and outlook
The market environment remains soft, with negative net recruitment and cautious customer behaviour. However, B3 has adjusted its cost base relatively meaningfully as avg. FTEs declined ~10% y-o-y to 899 (1,005). While volumes remain somewhat soft in Sweden, the operations in Poland and Norway should help support earnings growth going forward.
Consensus estimate revisions
On our unrevised estimates, B3 is trading at 5x '26e EV/EBITA. Mechanically, the impact on consensus EBITA estimates should be within a negative mid single-digit range when considering the reduced number of consultants and the somewhat lower overhead costs that offset the negative impact a bit.
* Margin improvement supported by cost efforts and Habberstad
* Consensus EBITA estimates likely down by mid single-digits
Q4'25 report
B3 reported Q4'25 sales of SEK 315m (-8% vs. ABGSCe 343m, -9% vs. FactSet consensus), representing an organic decline of 14%. The decline was primarily driven by fewer B3 consultants and subcontractors. Two, slightly offsetting factors were higher hourly prices and utilisation rates. Adj. EBITA came in at SEK 17m (+8% vs. ABGSCe 16m, +7% vs. consensus), representing a margin of 5.4%, which was better than we expected, but it was also cost-driven. More specifically, it was due to lower overhead costs in Sweden.
Thoughts and outlook
The market environment remains soft, with negative net recruitment and cautious customer behaviour. However, B3 has adjusted its cost base relatively meaningfully as avg. FTEs declined ~10% y-o-y to 899 (1,005). While volumes remain somewhat soft in Sweden, the operations in Poland and Norway should help support earnings growth going forward.
Consensus estimate revisions
On our unrevised estimates, B3 is trading at 5x '26e EV/EBITA. Mechanically, the impact on consensus EBITA estimates should be within a negative mid single-digit range when considering the reduced number of consultants and the somewhat lower overhead costs that offset the negative impact a bit.