<a id="bm-comp-6a382dd8-a41e-4e34-b48a-a0a936090a04" name="bm-comp-6a382dd8-a41e-4e34-b48a-a0a936090a04" class="BMCustomAnchor"></a><table><tr><td bm-component-id="6a382dd8-a41e-4e34-b48a-a0a936090a04" style="vertical-align: top; width:100.000000%;"><ul><li>Sales ramp-up continues (187% y-o-y), +13% vs. ABGSCe</li><li>Positive EBIT (SEK 324k vs. ABGSCe -2m), first time since early 2023</li><li>Aira partnership continues, improving FCF, positive momentum ahead</li></ul></td></tr></table><a id="bm-comp-2dd4fd9b-bd12-40c4-89b2-655de37e06df" name="bm-comp-2dd4fd9b-bd12-40c4-89b2-655de37e06df" class="BMCustomAnchor"></a><table><tr><td bm-component-id="2dd4fd9b-bd12-40c4-89b2-655de37e06df" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Aira partnership drove 32% sequential growth</h3><p>Energy Save reported sales of SEK 79m (13% vs. ABGSCe SEK 70m), 187% y-o-y and 32% q-o-q. The gross margin was 25% vs. 29% LY and <font color="#000000">EBIT came in at SEK 324k</font> (vs. ABGSCe SEK -2m), for a margin of 0% (ABGSCe -3%). Residential sales continued to ramp up and grew 28% q-o-q while Commercial grew by 168% q-o-q, but was down 38% y-o-y. According to the CEO, the Aira partnership continued to show results according to plan and drove revenues at a time when the industry and the rest of the market has seen relatively low activity. FCF improved and was SEK -399k (SEK -13m in Q4'23/'24) as working capital release was positive at ~1m. The cash balance was at SEK 51m, vs. 52m in Q4'23/24.</p><h3 class="bm-h3">Estimate changes and outlook</h3><p>On outlook, the CEO expects quarterly sales growth to continue (we have sales of SEK 72/77/81m in upcoming quarters vs. the actual 79m in the current quarter), albeit at a slower rate both y-o-y and q-o-q compared to previous quarters. Even though end-market conditions remain challenging (high interest rates, unfavourable electricity and gas prices), the CEO expects seasonality and lower inventory levels to support the continued sales ramp-up. We believe the better-than-expected Q1 results and higher base going into future quarters could lift FY'24/25e sales by ~10% for consensus, while this higher sales contribution could potentially result in Energy Save reaching positive EBIT for FY'24/25e (vs. our estimate of -4m).</p><h3 class="bm-h3">Valuation</h3><p>Energy Save is currently trading at 0.7x EV/Sales '24/'25e and 11-5x EBIT '25/'26-'26/'27e. We find today's report encouraging as numbers are better than our expectations across the board, and would expect a continued positive trend in both sales and earnings.</p><table id="bm-img-0020c835-780f-410b-afc4-711d81d46a9d" class="bm-img-table xslt-img-empty xslt-img-include"><tr><td class="xslt-img-caption">Quarterly outcome vs. expectations</td></tr><tr><td><img bm-img-encrypt="0020c835-780f-410b-afc4-711d81d46a9d" bm-img-original-height="590" bm-img-original-width="702" bm-img-svg="image:image_upload/81491_8915e869-1cad-4501-9e8a-c182d213ba29.svg" bm-img-width-hint="96.56%" id="bm-id-0020c835-780f-410b-afc4-711d81d46a9d" src="https://abgsc.bluematrix.com/images/image_upload/81491_8915e869-1cad-4501-9e8a-c182d213ba29_702.png" svg="/nas/web/clients/abgsc/images/image_upload/81491_8915e869-1cad-4501-9e8a-c182d213ba29.svg" width="702" alt="" title="" /></td></tr><tr><td class="xslt-img-source">Source: ABG Sundal Collier, company data</td></tr></table></td></tr></table>