Q1 Pre-tax profit of SEK 95m vs. ABG est. at SEK 127m

AUM was in line with ABGSC estimate

2022-23e look safe at first glance

Q1 Pre-tax profit came in at SEK 95m, vs. ABG at SEK 127m
Catella reported a Q1’21 pre-tax profit of SEK 95m (46m), 25% below ABGSCe of SEK 127m. The reported pre-tax profit is up 107% y-o-y, driven by the PAM transaction in France, where Catella divested 50.1% of its French subsidiary, which added ~SEK 130m to net financial items. Looking at EBIT, it came in at SEK -22m, where all the different segments showed decreasing operating profit y-o-y. The main deviation compared to ABGSC expectations in Q1 was the Corporate Finance segment, which saw continued challenges due to COVID-19. The group’s AUM came in at SEK 117bn, which was 0.5% above ABGSC. IPM showed continued outflows in Q1, but Catella has already announced that it will cease its operations in Q2’21e and return the remaining capital to investors, so it will not have any impact on our 2022 and 2023 estimates revisions.

Q1 details – AUM came in at SEK 117bn, in line with ABGSC
Catella reported sales of SEK 308m (-19% vs. ABGSC at SEK 381m), pre-tax profit came in at SEK 95m vs. ABGSC at SEK 127m. The AUM came in at SEK 117bn, 0.5% above ABGSCe. The AUM in Equity, Hedge and Fixed Income Funds saw outflows during the first quarter and came in 26% below ABGSCe at SEK 8bn. The AUM was however stronger in the PIM segment and came in 3% above ABGSCe, at SEK 109bn. The AUM drop q-o-q of 6% is impacted by the PAM divestment, which lowered AUM by ~SEK 15bn.

Trading on an EV/EBIT of 10x on 2022e
The reported AUM in the PIM segment was more or less in line with our expectations, so we are confident with 2022-23e at first glance. The stock is currently trading on an EV/EBIT of 10x on 2022e, which is ~30% below our peer group. Given that the operating profit in all the different segments decreased y-o-y, we expect the share to come down somewhat today.

research@abgsc.com (Introduce.se)

ABG Sundal Collier - Introduce.se