External pressure, internal control - Q3 review

Having digested the Q3 figures, we conclude that factors outside Clemondo’s control weighed on the gross margin, while underlying operational execution was solid. The 6.8%-point decline in the gross margin was driven by uncertainty around the Strait of Hormuz and its impact on input costs. In contrast, cost control was strong, with opex SEK3.3m below our estimate. Reading between the lines, we believe management is becoming more optimistic about the sales outlook. Our fair value range of SEK6–9 (8–11) is based on our 2027 estimates and EV/EBITDA of 4–6x.

Focus on 2027. Gross margin remains the most difficult variable to forecast. Just as margins declined rapidly, they could recover quickly if input costs stabilise and the price increases currently being implemented are sustained. This could result in a higher gross margin than we previously expected. We slightly reduce our sales estimates, reflecting lower growth expectations for the Medical Care segment. We also lower our opex estimates to reflect the increased cost focus and no IT implementation costs in 2027; we now expect opex to increase by SEK6m Y/Y in 2027.

Why customers choose Clemondo. Clemondo wins contracts for several reasons. In the Vehicle segment, an important factor is that its products can improve the working environment for customers’ employees. Traditional competitor products may cause headaches and dizziness after prolonged use, whereas customers report fewer such issues after switching to Clemondo’s products. This can reduce sickness-related absences and personnel costs. In addition, Clemondo’s high delivery reliability is an important competitive advantage.

Fair value range of SEK6–9. Our 2027e EV/EBITDA multiple range of 4–6x is in line with listed Stockholm companies expected to deliver similar sales growth and EBITDA margins in 2027, according to Bloomberg consensus.