* Return to growth in Q3 driven by both M&A and organic recovery* Enedo headwinds should be more than offset by Inission* We believe R12m EBITA bottomed in Q2, trading 40% below peers
Q3 expectations
For Q3, we forecast sales of SEK 524m, up 12% y-o-y, of which 5% should be organic growth. The acquisition of Selteka, which was consolidated at the beginning of Q3, should contribute nicely to the total growth, while the strong order intake over the past three quarters (+66% y-o-y) should support improved organic growth. Enedo still faces tough comps in Q3 — these will gradually ease over the coming two quarters — meaning we forecast the Inission segment to be a strong enough growth driver to more than offset this. We estimate an EBITA margin of 6.7% (5.7%), again driven by the Inission segment, while we wait for additional cost savings in Enedo to take effect from Q4.
Estimate changes
While the headwinds faced by Enedo continue to be a drag on earnings, we forecast sequential improvements from here, and reiterate our belief that Q2 marked the bottom for group organic R12m EBITA, thanks to improving performance in the Inission segment. We make only very minor estimate changes ahead of the report, and now forecast FY sales of SEK 2.15bn alongside an adj. EBITA margin of 5.8%, compared to the company's guidance of SEK 2.2bn and 6.0%.
Company valuation
Enedo's weakness is currently the main difference between Inission and peers, and has likely been a significant factor behind Inission currently trading 40% below Nordic EMS peers on '26e-'27e P/E. We note, however, that Enedo only contributes ~10% of Inission's value in our valuation, and that sequential operational improvements lie ahead.