Translation: Original published in Finnish on 3/7/2025 at 9:36 am EET.

Componenta published its financial statements release today. Although revenue in the last quarter of 2024 was around the level we had expected, the company managed to defend its profitability better than we had predicted. The guidance was loose, and we do not yet see any clearer signs of an improvement in the market situation during the financial year 2025. After a first glance at the report, we do not see any upward pressure on our forecasts, which expect a significant improvement in profitability in the current financial year, but additional information is needed to assess the order book in particular, given the impact of the Fortaco acquisition.

Defense of profitability better than we expected

In Q4, Componenta’s revenue grew by 24% to 27 MEUR, slightly below our forecast, supported by the Fortaco acquisition. Revenue was held back by production volumes, which were known to be below the company's expectations, and by lower prices for the main raw materials, which were passed on to customers.

Componenta's EBITDA amounted to 4.7 MEUR, exceeding our forecast of 3.8 MEUR. Adjusted EBITDA after the positive fair value adjustment related to the acquisition was 1.8 MEUR, corresponding to a moderate EBITDA margin of 6.4%. As a result, the company was better than expected in defending its lower lines against the impact of low production volumes, which eroded profitability. Depreciation was slightly below our expectations, while financial expenses marginally exceeded our forecasts. Thus, the forecast overshoot at the reported EPS level (actual EUR 0.29 vs. forecast EUR 0.19) is entirely attributable to the better-than-expected operational EBITDA.

The release of working capital supported cash flow well above our expectations, and net debt, consisting mainly of lease liabilities, fell to a comfortable level at the end of the financial year. In line with our expectations, Componenta will not pay a dividend for the financial year 2024.

Componenta's reported confirmed order book for the next 2 months increased to 16.7 MEUR. However, the higher order book than in the recent past includes orders from the acquired Fortaco business, which makes it somewhat difficult to estimate the development of new sales. We believe that Componenta's order book is a reasonable starting point for Q1, and we expect an acceleration of orders in early 2025.

Guidance indicates improved fiscal 2025 numbers as expected

In line with our expectations, Componenta provided guidance for year-on-year improvement in revenue and EBITDA for the financial year 2025. In our view, the inorganic support from the Fortaco acquisition for the financial year 2025 makes the achievement of revenue growth a foregone conclusion. The clear improvement in operational EBITDA that we forecast is also hardly supported by the guidance (adj. EBITDA 2025e 9.3 MEUR vs. 2024 4.9). Apart from that, we think the comments on fiscal 2025 were cautiously optimistic. After a first glance at the report, we do not see any upward pressure on our forecasts, which expect a significant improvement in profitability in the current financial year. Additional information is needed to assess the order book in particular, given the impact of the acquisition.