Pricer
Pricer - Order intake beat bodes well for H2 (ABG Sundal Collier)
2020-07-21 09:20
Sales -3% vs. ABGSCe, order intake +30% vs. ABGSCe
Underlying order intake flat q-o-q, despite COVID-19
29x ‘20e EV/EBIT
Q2 detailsSales SEK 288m (-3.5% vs ABGSC 298m), EBIT SEK 4m (68.3% vs ABGSC 2m), PTP SEK -6m (-252.0% vs ABGSC 4m), EPS SEK -0.06 / share (-274.9% vs ABGSC 0.04 / share). Solid quarter, with order intake of SEK 324m (+30% vs ABGSC SEK 249m), of which underlying order intake (i.e. order intake excl. non-announced orders) amounted to SEK 174m. We think that the latter is robust, given the high uncertainties during the quarter.
Order intake a positive
Pricer has started to deliver some of its received Best Buy orders (obtained in Dec '19 and Feb '20), but a large share of the delivery remains, which in turn should translate into high sales growth in H2'20. However, the Best Buy orders deliveries during the quarter, coupled with unfavourable FX movements and increase freight costs, hurt gross margins, which came in at 22.9% (vs. 33.2% in Q2’19). Our forecast was 21%.
Guidance and valuation
Pricer says that the beginning of the quarter was weak, but that June saw great recovery. It also highlights that gross margins could continue to face headwinds in the coming quarters due to increased freight costs. On our unrevised estimates, Pricer trades at 29x ‘20e EV/EBIT and a P/E of 28x.
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