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Third party research

OssDsign: Case intact despite slightly slower momentum - ABG

OssDsign

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

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* Major beat on EBIT, but lower sales* Estimates up on adj. EBIT for '25e-'26e (lower loss), yet down for '27e* Fair value range down to SEK 10-17 (11-18)Continued operational leverage despite sales missOssDsign delivered a mixed set of numbers in Q3, with sales coming in slightly below expectations but operational leverage continuing to improve. Sales were SEK 44.0m (-5% vs. ABGSCe of SEK 46.2m, no consensus), corresponding to organic growth of 35% (ABGSCe 38%). The quarter was negatively affected by a seasonally weaker start but ended on a strong note, with September marking a record month. Adj. EBIT came in at SEK -5.3m (+37% vs. ABGSCe of SEK -8.5m), driven by lower opex. The gross margin was 95.6% (ABGSCe 95.5%) and sales and commission costs were better than forecast at 48.5% of sales (vs ABGSCe of 49.0%), highlighting the company’s continued ability to scale efficiently. Operating cash flow was SEK -9.4m in Q3’25 (vs. SEK -8.7m in Q3’24), impacted by an intentional inventory build-up to support the ongoing sales ramp-up.Estimate changesOn the back of Q3’25, we turn slightly more cautious on the sales momentum and lower our sales estimates by 2% for '25e-'27e. With operational leverage improving, we reduce the expected loss on adj. EBIT by SEK 3.6m and SEK 0.5m for '25e and '26e, respectively. However, for ’27e, the softer sales outlook leads us to revise up the expected loss by SEK 6m. As the absolute numbers are small, the revisions appear somewhat dramatic, and we see no material change to the overall case.Fair value range down to SEK 10-17 (11-18)While we expect a somewhat slower sales momentum, we still pencil in a 31% sales CAGR for '24-'27e, driven by a continued sales ramp-up of Catalyst in the US. Nonetheless, based on our revisions, we lower our fair value range to SEK 10-17 (11-18) on the Q3 report. We arrive at our fair value range using a DCF model with a terminal growth rate of 3% and a WACC of 10%.
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