* Earnings miss following soft Sweden
* Estimates trimmed by 5/4% for '26e/'27e
* 12x/9x '26e/'27e adj. EBITA
Sweden drove the miss
Alligo delivered a softer-than-expected Q3, as a soft Sweden and Norway offset a strong Finland. Sales came in at SEK 2,295m (+5% y-o-y, +1% organic), -2%/-1% vs. ABGSCe/FacSet cons. Adj. EBITA of SEK 168m (+6% y-o-y) was 5%/8% below ABGSCe and consensus, for a margin of 7.3%. Sweden drove the miss. Organic sales fell 2% and adj. EBITA declined -3% y-o-y on lower volumes and a weaker gross margin, which was hit by an adverse customer mix with lower in-store (52% vs 55%) and own-brand (21.8% vs 22.8%) shares. Management pointed to warm early-autumn weather, which held back seasonal clothing sales, and a September e-commerce platform upgrade that disrupted customer traffic. Management estimates the upgrade cost SEK 8-10m in sales, mainly in the accretive own brand segment. Defence was the exception, with continued growth. Organic growth in Norway continued its slump following subdued oil and gas activity. Management launched a project in Q3 to address Norway’s unsatisfactory profitability, including cost adjustments of ~SEK 35m, with full effect expected from year-end. Finland continued to see good traction across manufacturing and defence. Sales to SME and store customers also grew, albeit from a low base.
Estimates lowered by 4-3% for '26e-'27e
We lower adj. EBITA by 4-3% '26-'27e, following a more cautious view of Sweden, which enters the seasonally strong Q4 with negative organic growth (-2% in Q3), a weaker mix and limited cost levers, although ongoing price renegotiations with larger, lower-margin customers should provide some margin support.
Share trading at 12x/9x '26e/'27e adj. EV/EBITA
The share traded down 10% on the reporting day, and has returned -20% the L3M, compared with OMXSALLS +1%. The share is currently trading at 12-9x '26e-'27e adj. EV/EBITA.