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Research update HANZA, Q1 2023: Ahead of the curve

9 maj 2023

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Equity research HANZA

Carlsquare Equity Research increases our sales and earnings estimates markedly as the strong Q1 performance validates the company strategy and puts HANZA ahead of the curve in pursuit of its financial targets. The outlook motivates a premium valuation to industry peers, and we raise the base case to SEK 96 (66) per share (adjusted for SEK 0.75 per share dividend).

Strength across the board

HANZA’s Q1 2023 sales and earnings widely exceeded the previous consensus estimates, as indicated by the positive preannouncement in April. Sales grew by 29 per cent in the first quarter and surpassed SEK 1bn for the second quarter in a row at SEK 1,065m. Organic growth was 23 per cent, only slightly below the previous quarters, and the order book is at record levels.  Excluding electricity subsidies in Sweden of SEK 6m, the EBITA result about doubled to SEK 82m. While the strongest earnings improvement came in Other markets, the margin in the Main markets segment was just as much of a positive surprise to us. The completed coordination program in Germany drove efficiency, and the performance bodes well for the future development of the cluster.

Industry-leading outlook as financial targets appear within reach

Following the strong development and outlook in Q1, 2023, we raise the sales estimates for 2023 and 2024 by some twelve per cent. We review the base case and assume that HANZA will reach its 2025 target of at least SEK 5bn in sales. This implies a CAGR of about twelve per cent from 2022 to 2025. We believe HANZA will be ahead of the curve in 2023, and we assume around 17 per cent growth for the full year. The margin improvement to 7.7 per cent (5.0) in the quarter is also a significant step towards the company’s goal of reaching an EBITA margin of at least eight per cent by the end of 2025. All in all, we lift our EBITDA estimates by some 23 per cent per year for the next two years from higher sales and better economies of scale/operating leverage than our previous forecast.  Based on consensus estimates, the growth and earnings outlook are better than the Nordic peer group median.

Momentum motivates premium valuation

We lift our base case markedly by over 40 per cent from raised estimates due to increased confidence in HANZA’s financial targets. We believe the outlook motivates a premium valuation to industry peers. HANZA shares have gained almost 90 per cent YTD, clearly outperforming the general market. However, there is still potential upside if HANZA can further increase the pace of expansion, e.g., via acquisitions.


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The analyst Niklas Elmhammer does not own and may not own shares in the analysed company.


Research update HANZA, Q1 2023: Ahead of the curve