DistIT
DistIT - Feedback from ABGSC Investor Days (ABG Sundal Collier)
2020-12-02 21:03
Own products could be >50% of sales in five years
Sees potential in increasing EBIT from own products
5.6x ’21e EV/EBIT on 22% EBIT CAGR ’19-’22e
Confident in own products strategyToday, we hosted CEO Robert Rosenzweig and CFO Philip Gunnarsson on the ABGSC Investor days. The presentation was generally focused on communicating its strategy for own products, and DistIT’s transition into a product company, rather than a distribution partner. Currently, own products constitute c. 26% of sales, but Robert believes it will be more than 50% in five years. To reach customers, DistIT will begin targeting customers directly with own sales channels. Also, it will focus on expanding into Europe with its own products, as the concepts has been successful in the Nordics and that the optimal way of scaling is reaching a broader market. Specifically, smart home and gaming concepts seem to have been particularly successful. DistIT plans to continue expanding its concept offering, targeting megatrends such as security, electric vehicles, modern workplace, power, gaming, lifestyle gadgets and e-health. We believe it will test new concepts through its current local sales channels, an inexpensive way of seeing which concepts are viable for the broader European market.
Own brands to drive large EBIT improvement
During the presentation, DistIT provided and interesting EBIT bridge, which illustrated a threefold increase of mid-term EBIT. This is mainly driven by increased gross profit from own brands and represents an effect of volume increases and a positive margin mix as the own products has higher margins. In the short term, we estimate 22% EBIT CAGR for ’19-‘22e mainly driven by margin improvements.
Trading c. 33% below its 5Y average
On our estimates, the share is trading on EV/EBIT ’21e of 5.6x, ~33% below its 5Y historical average. We are seeing strategic initiatives playing out, with the savings programme having effectively lowered costs and own products delivering high margin accreti
...
- Läs mer på Introduce
Läsaren av innehållet kan anta att ABG Sundal Collier har erhållit eller kommer att erhålla betalning för utförandet av finansiella företagstjänster från bolaget. Ersättningen är på förhand avtalad och är inte beroende av innehållet.
research@abgsc.com (Introduce.se)
ABG Sundal Collier - Introduce.se