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BHG Group

BHG Group

Home improvement online

BHG has grown to be the leading online retailer of DIY and home furnishing goods in the Nordics, with a market share of ~30%. The group has also expanded into Eastern Europe through the acquisition of Furniture1. The drop-shipping model is a key success factor for BHG, but it has recently established an in-house solution for last-mile deliveries, allowing for an increased range of services.

We believe that BHG could reap the benefits of a fast-growing online market within Home Improvement. In addition, we see room for the company to fuel growth further through M&A, while a greater share of proprietary brands could support its margins going forward.

A global recession caused by COVID-19 could put a dent in demand. We do not rule out that new market entrants could compete for BHG’s No.1 spot. BHG runs a clear acquisition-driven agenda. Hence, there are naturally some M&A related risks.

SEKm 2020 2021e 2022e
Sales 8968 11424 11710
Sales growth (%) 44,4 27,4 2,5
EBITDA 892 1061 1081
EBITDA margin (%) 9,9 9,3 9,2
EBIT adj 701 883 898
EBIT adj margin (%) 7,8 7,7 7,7
Pretax profit 550 755 782
EPS rep 3,86 5,08 5,18
EPS growth (%) 134,8 31,4 2,1
EPS adj 4,17 5,49 5,59
DPS 0 0,5 1
EV/EBITDA (x) 24,3 15,8 15,4
EV/EBIT adj (x) 30,9 19,1 18,6
P/E (x) 46,3 27,1 26,5
P/E adj (x) 42,9 25 24,6
EV/sales (x) 2,4 1,5 1,4
FCF yield (%) -5,5 3,1 3,7
Dividend yield (%) 0 0,4 0,7
Net IB debt/EBITDA 2,8 0,6 0,4
Lease adj. FCF yield (%) -6,2 2,5 3,1
Lease adj. ND/EBITDA 2 0 -0,1
SEKm 2020 2021e 2022e
Leasing payments 0 0 0
Sales 8968 11424 11710
COGS -6637 -8432 -8646
Gross profit 2331 2992 3065
Other operating items -1439 -1931 -1984
EBITDA 892 1061 1081
Depreciation on tangibles -49 -66 -69
Depreciation on intangibles 0 0 0
EBITA 658 822 838
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT 658 822 838
Other financial items 0 0 0
Net financial items -107 -67 -56
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 550 755 782
Tax -130 -154 -161
Net profit 420 601 621
Minority interest -6 -8 -8
Net profit discontinued 0 0 0
Net profit to shareholders 415 593 612
EPS 3,86 5,08 5,18
EPS Adj 4,17 5,49 5,59
Total extraordinary items after tax -43,1 -60,4 -60,4
Tax rate (%) -23,6 -20,4 -20,6
Gross margin (%) 26 26,2 26,2
EBITDA margin (%) 9,9 9,3 9,2
EBITA margin (%) 7,3 7,2 7,2
EBIT margin (%) 7,3 7,2 7,2
Pretax margin (%) 6,1 6,6 6,7
Net margin (%) 4,7 5,3 5,3
Growth rates Y/Y 2020 2021 2022
Sales growth (%) 44,4 27,4 2,5
EBITDA growth (%) 108,7 19 1,8
EBIT growth (%) 133,1 25,1 1,9
Net profit growth (%) 133,2 43 3,2
EPS growth (%) 134,8 31,4 2,1
Profitability 2020 2021 2022
ROE (%) 14,6 15,5 12,4
ROE Adj (%) 15,8 16,8 13,3
ROCE (%) 13,3 12,3 10,6
ROCE Adj(%) 14,2 13,2 11,4
ROIC (%) 8,8 9,5 9,3
ROIC Adj (%) 9,4 10,2 10
Adj earnings numbers 2020 2021 2022
EBITDA Adj 935 1122 1141
EBITDA Adj margin (%) 10,4 9,8 9,7
EBITA Adj 701 883 898
EBITA Adj margin (%) 7,8 7,7 7,7
EBIT Adj 701 883 898
EBIT Adj margin (%) 7,8 7,7 7,7
Pretax profit Adj 593 816 842
Net profit Adj 453 649 669
Net profit to shareholders Adj 447 641 660
Net Adj margin (%) 5 5,7 5,7
Depreciation and amortisation -234 -239 -243
Of which leasing depreciation -185 -171 -173
EO items -43 -60 -60
Impairment and PPA amortisation 0 0 0
EBITDA lease Adj 935 1122 1141
EBITDA lease Adj margin (%) 10,4 9,8 9,7
SEKm 2020 2021e 2022e
EBITDA 892 1061 1081
Net financial items -107 -67 -56
Paid tax -130 -154 -161
Non-cash items 178 76 48
Cash flow before change in WC 833 916 912
Change in WC 162 58 32
Operating cash flow 994 974 943
CAPEX tangible fixed assets -94 -153 -176
CAPEX intangible fixed assets 4 0 0
Acquisitions and disposals -1951 -326 -175
Free cash flow -1047 495 593
Dividend paid -6 -59 -118
Share issues and buybacks 13 1716 0
Other non cash items -1187 -540 -431
Decrease in net IB debt -1412 225 316
Balance Sheet (SEKm) 2020 2021 2022
Goodwill 4395 4787 4787
Indefinite intangible assets 0 0 0
Definite intangible assets 1804 1858 1938
Tangible fixed assets 74 99 126
Other fixed assets 29 29 29
Fixed assets 6904 7420 7526
Inventories 992 1153 1270
Receivables 434 505 556
Other current assets 0 0 0
Cash and liquid assets 299 2288 2413
Total assets 8630 11366 11764
Shareholders equity 2787 4848 5047
Minority 36 39 39
Total equity 2823 4887 5086
Long-term debt 2043 2029 2029
Pension debt 23 32 32
Convertible debt 0 0 0
Deferred tax 375 375 375
Other long-term liabilities 948 948 948
Short-term debt 122 213 213
Accounts payable 717 914 937
Other current liabilities 980 1058 1234
Total liabilities and equity 8630 11366 11764
Net IB debt 2478 595 470
Net IB debt excl. pension debt 2456 563 438
Capital invested 6624 7096 7170
Working capital -270 -314 -346
EV breakdown 2020 2021 2022
Market cap. diluted (m) 19197 16225 16225
Net IB debt Adj 2478 595 470
Market value of minority 0 0 0
Reversal of shares and participations 0 0 0
Reversal of conv. debt assumed equity 0 0 0
EV 21676 16819 16694
Capital efficiency (%) 2020 2021 2022
Total assets turnover (%) 122,5 114,3 101,3
Capital invested turnover (%) 157,7 157,7 173,9
Capital employed turnover (%) 181,6 181,4 189,9
Inventories / sales (%) 9,3 10 10,1
Customer advances / sales (%) 0 0 0
Payables / sales (%) 7 7,4 7,6
Working capital / sales (%) -1,3 -2,6 -2,8
Financial risk and debt service 2020 2021 2022
Net debt / equity (%) 87,8 12,2 9,2
Net debt / market cap (%) 23,8 3,7 2,9
Equity ratio (%) 32,7 43 43,2
Net IB debt adj. / equity (%) 87,8 12,2 9,2
Current ratio (%) 87,7 167,6 166
EBITDA / net interest (%) 830,3 1580,9 1928,2
Net IB debt / EBITDA (%) 277,9 56 43,4
Interest cover (%) 612,4 1225 1494,5
Lease liability amortisation -147 -94 -94
Other intangible assets 1804 1886 1965
Right-of-use asset 602 619 619
Total other fixed assets 29 29 29
Leasing liability 600 619 619
Total other long-term liabilities 1323 1614 1614
Net IB debt excl. leasing 1879 -24 -149
Net IB debt / EBITDA lease Adj (%) 201 -2,1 -13,1
SEKm 2020 2021e 2022e
Shares outstanding adj. 107 118 118
Fully diluted shares Adj 107 118 118
EPS 3,86 5,08 5,18
Dividend per share Adj 0 0,5 1
EPS Adj 4,17 5,49 5,59
BVPS 25,96 41,02 42,71
BVPS Adj -31,78 -15,44 -14,43
Net IB debt / share 23,1 5 4
Share price 97,15 137,3 137,3
Market cap. (m) 10431 16225 16225
Valuation 2020 2021 2022
P/E 46,3 27,1 26,5
EV/sales 2,42 1,47 1,43
EV/EBITDA 24,3 15,8 15,4
EV/EBITA 33 20,4 19,9
EV/EBIT 33 20,4 19,9
Dividend yield (%) 0 0,4 0,7
FCF yield (%) -5,5 3,1 3,7
P/BVPS 6,89 3,35 3,21
P/BVPS Adj -5,63 -8,89 -9,52
P/E Adj 42,9 25 24,6
EV/EBITDA Adj 23,2 15 14,6
EV/EBITA Adj 30,9 19,1 18,6
EV/EBIT Adj 30,9 19,1 18,6
EV/cap. employed 3,9 2,2 2,1
Investment ratios 2020 2021 2022
Capex / sales 1 1,3 1,5
Capex / depreciation 182,4 225,9 251,7
Capex tangibles / tangible fixed assets 127,2 153,8 139,8
Capex intangibles / definite intangibles -0,2 0 0
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 66,8 68,1 55,5
Lease adj. FCF yield (%) -6,2 2,5 3,1

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Media

BHG Group - Company presentation with CEO Adam Schatz & CFO Jesper Flemme
BHG Group - Company presentation with CEO Adam Shatz and CFO Jesper Flemme

Main shareholders - Bygghemma

Main shareholders Share capital % Voting shares % Verified
EQT 17.7 % 17.7 % 28 Feb 2021
Swedbank Robur Fonder 9.5 % 9.5 % 31 Aug 2021
Capital Group 8.0 % 8.0 % 30 Jun 2021
Handelsbanken Fonder 7.7 % 7.7 % 31 Aug 2021
Lannebo Fonder 4.3 % 4.3 % 31 Aug 2020
Fidelity Investments (FMR) 3.8 % 3.8 % 31 Jul 2021
Cliens Fonder 3.0 % 3.0 % 31 Aug 2021
Vanguard 1.9 % 1.9 % 31 Aug 2021
Vitruvian Partners 1.9 % 1.9 % 31 Jul 2021
Spiltan Fonder 1.8 % 1.8 % 31 Aug 2021
Source: Holdings by Modular Finance AB

Insider list - Bygghemma

Name Quantity Code Date
Jesper Flemme + 45 000 BUY 11 Jun 2021
Mikael Hagman + 45 000 BUY 11 Jun 2021
Adam Schatz + 45 000 BUY 11 Jun 2021
Mikael Hagman + 2 000 BUY 23 Feb 2021
Adam Schatz + 1 850 BUY 22 Feb 2021
Adam Schatz + 1 850 BUY 22 Feb 2021
Jesper Flemme - 9 000 SELL 15 Feb 2021
Jesper Flemme - 4 000 SELL 12 Feb 2021
Jesper Flemme - 10 000 SELL 12 Feb 2021
Jesper Flemme - 5 806 SELL 11 Feb 2021

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