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Equity Research Enrad, Q1 2024: Sales higher than expected

26 Apr 2024

Today, Friday 26 April, Enrad AB (“Enrad” or the “Company”) published its report for the first quarter of 2024. Below are our initial impressions of the results, including deviations from our forecasts.

  • Net sales of approximately SEK 7.6 million were 159% higher than our forecast of approximately SEK 3 million. The forecast was based on a low order intake reported in the Q4 2023 report on 23 February 2024.
  • Gross profit after purchases of goods and services was approximately SEK 4.3 million, compared with our estimate of just over SEK 1.6 million. The gross margin was 56% in the first quarter, which was in line with our forecast.
  • Other external and personnel costs amounted to approximately SEK 1.7 million, compared with our forecast of SEK 1.1 million.
  • Operating profit after depreciation was minus SEK 1.2 million, compared with our estimate of minus SEK 1.9 million.

On 25 April the company announced that its Norwegian subsidiary had received two orders for heat pump installations totaling SEK 5.3 million.

The Company’s cash and cash equivalents on 31 March 2024 amounted to approximately SEK 3.0 million, compared to SEK 6.4 million on 31 December 2023. Capital tied up in inventories amounted to SEK 20 million on 31 March 2024, of which SEK 8 million was pledged. Management is evaluating further options to secure working capital, but at the same time believes that the conditions are in place to continue operations during the remainder of 2024 without additional capital.

Our impression is that Enrad’s Q1 2024 report is strong, not least since heat pump sales in Sweden fell by 43% in Q1 2024. The company has recently launched its performance monitoring and forecasting service for units sold and delivered, which should strengthen its competitiveness in the Swedish, Norwegian, and Finnish markets.

We intend to release a full research update  of Enrad shortly.

Read our latest Research Update here


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Equity Research Enrad, Q1 2024: Sales higher than expected