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Third party research

SinterCast: Sales pre-announced but somewhat better mix - ABG

SinterCast

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

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* Sales SEK 23.5m as pre-announced, EBIT +5% vs. ABGSCe* 5m EE milestone pushed to '27, expect '25 installations >10m, in line* Novelis fire not expected to impact F-150 engine production in Q4Q3 resultsSales fell 28% y-o-y and were in line with the pre-announced figure. Annualised engine equivalents produced were 2.7m, falling 23% y-o-y, and were thereby also in line with the pre-announcement. Sampling cups sold decreased 27% y-o-y, and were 34% above our estimate. With a margin of 23.8%, 1.1pp above our estimate, EBIT adj. was 5% above our estimate. The somewhat stronger margin vs. our estimate was due to the positive mix effect on the gross margin from higher sampling cup sales.Estimate changesThe Q3 numbers in isolation imply EBIT adj. comes up 1%. Following significant market headwinds in '25, the company pushes its 5m EE milestone from '26 to '27, which is already in our estimates. Installation revenues for '25 are expected to exceed SEK 10m, in line with our figure of SEK 10.8m. While the recent fire at automotive supplier Novelis is expected to impact Ford F-150 assembly in Q4, there have been no indications of reduced orders for its SinterCast-CGI based engine, and the company expects that engine production will continue at pace while assembly catches up to demand.Company valuationOver the past three months, the share has returned -4%, compared to the +5% of the OMX Stockholm Allshare. The share is currently trading at 30x-17x '25e-'27e P/E, compared to its 10-year historical median of 23x-15x.
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