Inission (INISS) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales declined 9.1% year-over-year to SEK 468 million; organic sales fell 16%, with AXXE contributing 33 MSEK.

• EBIT for Q3 was SEK 25.8 million (down from 44.3 million), with EPS at 0.6 SEK (1.4 SEK last year).

• Cost reduction initiatives are ongoing, with significant cuts in personnel and operational expenses, especially in the Tunis factory.

• Order book is down nearly 30% year-over-year, but order intake increased by 6 MSEK to 464 MSEK and duration has normalized.

• Inventory value reduced by 29 MSEK in the quarter and by 130 MSEK since Q3 last year (excluding AXXE).

Financial highlights

• Net sales for Q3 were 468 MSEK (515 MSEK), and for Jan–Sep 1,619 MSEK (1,642 MSEK).

• Net added value (sales minus material) was SEK 9 million higher year-over-year, but SEK 6 million lower when adjusted for AXXE.

• EBITDA margin for the quarter in EMS business area was 6.3%; group EBITDA margin was 10.5%.

• Cash flow from operations for Q3 was -39.5 MSEK (7.8 MSEK); for Jan–Sep, -62.5 MSEK (68.9 MSEK), impacted by ending factoring and invoicing sales.

• Net debt at period end was -526 MSEK (-538 MSEK), with equity ratio at 37.8% (36.2%).

Outlook and guidance

• Full-year 2024 sales target revised to SEK 2.1–2.2 billion (from SEK 2.4 billion); EBITDA/EBITA margin expected above 6% (previously 7%).

• Management expects downturn to bottom out in Q4, with growth resuming in H2 2025.

• Cost base adjustments to be fully realized by Q2 2025.

• Mid-term targets remain: 15% annual growth and 9% EBITDA margin.

• Slow but steady demand recovery observed, with some factories hiring again.