Raute - Very high 13.5% EBITDA margin
Raute’s EUR 46.4m Q3 revenue was soft relative to our estimate, yet the EUR 6.3m comparable EBITDA clearly topped our EUR 5.0m estimate and led already to a very high margin of 13.5%. Raute may not be able to improve much from such an earnings level in the short-term since the market remains challenging, as evidenced by the low EUR 15m new order intake in Q3. In our view smaller equipment orders nevertheless have room to gain next year as their demand has been weak for a while now.
- Raute Q3 revenue grew by 36.2% y/y to EUR 46.4m, compared to our EUR 53.1m estimate. Wood Processing amounted to EUR 32.2m vs our EUR 37.7m estimate, whereas Services landed at EUR 9.9m vs our EUR 11.1m estimate. Analyzers was EUR 4.2m, compared to our EUR 4.3m estimate.
- Comparable EBITDA was EUR 6.3m vs our EUR 5.0m estimate while EBIT came in at EUR 4.8m vs our EUR 3.6m estimate. Wood Processing EBITDA was EUR 3.7m, compared to our EUR 2.6m estimate, as mill-sized projects’ deliveries continued to make solid progress while there was also a good amount of modernizations. Wood Processing’s 11.5% comparable EBITDA margin was clearly higher than we estimated. Services’ profitability was as we expected as demand remained strong while Analyzers came in slightly better than we estimated, helped by efficiency improvements.
- Q3 order intake amounted to EUR 15m, compared to our EUR 26m estimate. Customers seem to have postponed their investment plans well into 2025. Services orders were once again a bright spot.
- Order book stood at EUR 186m at the end of Q3 (EUR 192m a year ago).
- Raute guides FY’24 revenue to be between EUR 190-210m and comparable EBITDA in the range of EUR 17-21m (guidance issued on Oct 22). The EUR 19m EBITDA guidance midpoint thus implies EUR 4.3m Q4 EBITDA, while the upper end suggests it flat q/q at EUR 6.3m. Raute may hence not reach quite such a high 13.5% EBITDA margin in Q4.