Enersense - High growth, margins to improve
Enersense’s Q3 revenue topped our estimate, while profitability figures came in below our estimates. International Operations and Connectivity achieved margin improvement, while investments burdened Smart Industry and Power profitability.
- Enersense Q3 revenue increased by 46.2% y/y to EUR 94.2m, compared to our EUR 80.0m estimate. Higher volumes in service and project businesses drove 74% y/y growth for Smart Industry. Strong order backlog drove Power’s 51% growth, while International Operations’ 40% growth was mainly due to the Baltic high-voltage power line construction projects. Connectivity also grew by 20%.
- EBITDA landed at EUR 3.9m vs our EUR 5.2m estimate, while EBIT was EUR 1.6m vs our EUR 2.9m estimate. Power’s profitability remained flat y/y as it was burdened by investments in the EV charging solutions business. Connectivity and International Operations showed the best performance in terms of improving profitability. Connectivity’s higher volumes and improved operational efficiency helped results, and higher costs were transferred to sales prices. The segment also continues to improve in these respects. International Operations’ comparison figures were burdened by steep increases in material and other costs in the Baltics.
- Order backlog stood at EUR 511m at the end of Q3 (EUR 385m a year ago). Order backlog grew the most in Connectivity, but also within Power. Smart Industry and International Operations backlogs remained rather flat y/y.
- Enersense guides FY ‘23 adjusted EBITDA in the range of EUR 12-18m (unchanged), but now expects revenue to be over EUR 330m (previously over EUR 300m).