<a id="bm-comp-58327f3e-371d-4a5e-b9d1-2a61d693a6b5" name="bm-comp-58327f3e-371d-4a5e-b9d1-2a61d693a6b5" class="BMCustomAnchor"></a><table><tr><td bm-component-id="58327f3e-371d-4a5e-b9d1-2a61d693a6b5" style="vertical-align: top; width:100.000000%;"><ul><li>Adj. EBITA -11% vs ABG, -13% vs consensus</li><li>Service companies drove the miss, products held up better</li><li>We expect consensus to cut estimates by 3-5%</li></ul></td></tr></table><a id="bm-comp-3f18f05f-c5d8-436d-8cab-0c873f2ec1a7" name="bm-comp-3f18f05f-c5d8-436d-8cab-0c873f2ec1a7" class="BMCustomAnchor"></a><table><tr><td bm-component-id="3f18f05f-c5d8-436d-8cab-0c873f2ec1a7" style="vertical-align: top; width:100.000000%;"><h3 class="bm-h3">Q4 details</h3><p>Sales SEK 1,153m (-3% vs ABG 1.183m, -9% vs. cons 1,266m), -26% y-o-y, -8% organic (ABG -3%, -9% Q3’24). Adj. EBITA 102m (-11% vs. ABG 114m, -13% vs. cons 117m), -39% y-o-y, margin 8.8% (ABG 9.7%, cons 9.2%, Q3’24 11.5%). EBITA was weaker in all three segments, especially in Services which we expected to be weak, but less in Water which held up better. The company points to fewer days in December and the challenging market conditions, resulting in weaker demand and some credit losses, as the main reasons for weaker profitability in Services (sales were in line). Product companies held up better than the service companies in both Services and Infrastructure, which is encouraging. FCF was 65m (64% conversion).</p><h3 class="bm-h3">Estimate changes</h3><p>Our view continues to be that the installation market likely has bottomed, but that margins will remain under pressure near-term. As we see the market improving and prospects for Vestum to improve its project mix to projects with higher margins, we do not think all the miss in Services will extrapolated. We still expect consensus estimates to come down 3-5% given that EBITA was slightly weaker in Infrastructure and Water as well.</p><h3 class="bm-h3">Final thoughts</h3><p>We believe that Vestum has done a good job transforming the business into higher quality product companies. Its cash conversion continues to be solid as well, which together with divestments means that gearing is at good levels (2.2x including proceeds from divestments made in Q4). This means that the company is well-positioned to continue acquiring product companies with higher quality than the current group average, which should have a positive effect on margins and ROCE. Management will host a presentation of the report at 11:00 CET (<a href="https://vestum.events.inderes.com/q4-report-2024/register" target="_blank">link</a>).</p><table id="bm-img-2ad760ff-4e44-475c-a9a2-7fbc84581d86" class="bm-img-table xslt-img-empty xslt-img-include"><tr><td class="xslt-img-caption">Outcome vs. expectations</td></tr><tr><td><img bm-img-encrypt="2ad760ff-4e44-475c-a9a2-7fbc84581d86" bm-img-original-height="769" bm-img-original-width="702" bm-img-svg="image:image_upload/85483_9f416d19-4596-418b-9c3b-8b057714e206.svg" bm-img-width-hint="96.56%" id="bm-id-2ad760ff-4e44-475c-a9a2-7fbc84581d86" src="https://abgsc.bluematrix.com/images/image_upload/85483_9f416d19-4596-418b-9c3b-8b057714e206_702.png" svg="/nas/web/clients/abgsc/images/image_upload/85483_9f416d19-4596-418b-9c3b-8b057714e206.svg" width="702" alt="" title="" /></td></tr><tr><td class="xslt-img-source">Source: ABG Sundal Collier, company data, Modular Finance</td></tr></table></td></tr></table>