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Third party research

Nexam Chemical: Seasonal effects weigh on quarter - ABG

Nexam Chemical Holding

This is a third party research report and does not necessarily reflect our views or values

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* Sales -5%, adj. EBIT SEK -2m vs. ABGSCe* Seasonal effects impacted Aesthetics segment* Recycling continues to be the star performer; +250% y-o-yQ3 resultsSales came in at SEK 45m (-5% vs. ABGSCe 48m), +3% y-o-y. The company writes that the quarter was affected by seasonal effects, with customers' holiday closures, especially within Aesthetics. However, the Recycling segment continues its positive trajectory, with sales amounting to SEK 5.6m (vs. SEK 1.6m last year). Moreover, the company is seeing mixed signals in other business areas and notes that Lightweight remains at a significantly lower level compared to previous years. However, costs appear to be under control, and adj. EBIT was lower primarily due to weaker sales, coming in at SEK -2.3m (vs. ABGSCe -0.4m). EBIT has been adjusted for a credit loss due to outstanding invoices to a customer in the UK that went bankrupt (SEK -1m). FCF came in at SEK 5.1m (vs. ABGSCe 3.2m).Estimates and outlookOn numbers alone, '25e-'27e sales change by -1%, and EBIT adj. changes by SEK -2m. The company continues to see Recycling as an increasingly clear driver and highlights that it now has customers producing on an industrial scale.ValuationThe share has returned -5% L3M (vs. peer median -1% and OMX Stockholm Allshare +2%), and is currently trading at 1.6x-1.1x '25e-'27e EV/Sales on our pre-report estimates vs. the peer median of 2.3x-1.3x.
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