First impression HANZA, Q1 2023: Strength across the board
3 May 2023
This morning, HANZA reported its Q1 2023 earnings. Below are our first impressions of the report.
- HANZA had already provided some guidance on Q1 sales and EBITA margin in the positive preannouncement on April 17. The strong growth in sales and earnings of 29 and 99 per cent (excluding electricity subsidies of SEK 6m), respectively, was even slightly upwards of the guidance in our view. Organic growth was 23 per cent.
- Compared to our previous expectations, both segments surprised us positively
- Efficiency improvements following, e.g., expansion programs in Other markets, and increased profitability in the German cluster, have contributed to the strong margin increase
- Cash flow from operations at SEK 89m (13) clearly shows that cash conversion is improving
- HANZA says order backlog is still at record levels. Sales have been limited by availability of components, but the situation has improved in 2023 and is expected to improve further going forward. The company is recruiting and investing in capacity in existing manufacturing clusters and is also considering acquisitions.
- As we outlined in our initial comment on the positive preannouncement in April, the strong growth and better-than-anticipated profitability will likely entail us to revise our sales and earnings estimates, as well as valuation, upwards.
In the table below we compare the final Q1, 2023 reported sales and earnings vs our estimates before the preannouncement.
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