Ferronordic: Rudd impresses on its debut – ABG


Adj. EBIT SEK -15m (ABGSCe -11m, cons -6m)
Strong performance in Rudd: adj. EBIT SEK +36m (ABGSCe +16m)
Trading at 9x ’24e EV/EBIT on pre-Q4 estimates

Q4 outcome

Sales were SEK 915m (-1% vs. ABGSCe 925m, -3% vs. FactSet cons. 943m), and adj. EBIT was -15m (ABGSCe -11m, cons -6m), for a margin of -1.6% (ABGSCe -1.2%, cons -0.6%). This included several one-offs, totalling SEK -47m (ABGSCe/cons 0), of which 1) -11m from acquisition costs for Rudd in the US, 2) -11m and -2m from inventory impairments in Germany and Kazakhstan, respectively, and 3) -23m from implementation of a cost savings program in Germany that is expected to save SEK 60m per annum starting Q2’24. The newly acquired Rudd (consolidated end of Nov) delivered a stellar first set of numbers, beating our sales expectations by 27% with an adj. EBIT of SEK +36m (ABGSCe +16m), for a margin of 11.7% (ABGSCe 6.4%). Given that leverage has come up notably following the acquisition of Rudd, the Board proposes no dividend payment for 2024.


ABGSC Commissioned Research