Market conditions getting better

Estimates up after beat in Q4

Proposes a dividend of SEK 0.6 per share

Q4: Sales of SEK 406m (+3.2% y-o-y), Sweden recovers fast
Poolia reported Q4 sales of SEK 406m (393m), meaning the group was back to y-o-y growth, which we find impressive given that the y-o-y decline in Q3 was 19%. We had forecast a more gradual improvement, which is highlighted by the sales beat on our estimates of 15%. Most of the deviation was from Uniflex Sweden, which posted y-o-y sales growth of 19% and benefitted from exposure to the strong e-commerce business in Q4. Poolia Sweden was also back to y-o-y growth in Q4, with 4.2%. The decision to recall all Swedish staff from their short-term layoffs in September was successful, as Poolia increased its market share in Q3 to 5.4% (4.7%) and probably even more so in Q4. The caveat in Q4 was ongoing struggles in Germany, which was below our expectations. Group adj. EBIT was SEK 6.7m (5.9m), corresponding to a margin of 1.7% vs. ABGSce at SEK 4.1m with a margin of 1.2%. Poolia also proposed a dividend of SEK 0.6 SEK per share.

EPS up ~4%, would have been more if not for Germany
We raise ’21e-‘22e EPS by ~4%, with raised sales assumptions for all segments except Germany. The main revision is for Uniflex Sweden, for which we now forecast a faster recovery than before after the turnaround in Q4. The situation in Germany offsets our overall upgrades somewhat, and new, shorter lockdowns in Finland and Oslo in Q1 are a short-term risk to demand.

We think Poolia Sweden has room to improve profitability
Overall, Poolia handled headwinds from the pandemic well in 2020, with liquidity was never an issue, and after the summer break, it got on the offensive by recalling staff on short-term layoffs. Now with easing headwinds from COVID-19, we see growth returning, and we think Poolia Sweden’s profitability might be the next issue on the list, as the business segment should have the potential to be more profitable long term than the
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