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Lagercrantz

Lagercrantz

Supplier of technology in expansive niches

Lagercrantz is a technology trading company group in expansive niches offering value creating technology to corporate customers. The operations are conducted according to a decentralized model with 50+ independent companies divided into 4 divisions, Electronics, Mechatronics, Communications and Niche Products. Acquiring new companies is a central part of the business model. Lagercrantz has an increasing proportion of proprietary products, which enables enhanced control of the value chain and supports higher margins. The share is listed on Nasdaq Stockholm, Mid Cap, since 2001.

The recent years’ export initiatives could improve organic growth more than we currently assume. Increased proportion of proprietary products and acquisitions of product-companies have the potential for further margin expansion.

Poor development in individual subsidiaries, overall weaker market conditions, abrupt competition in a specific niche-area. Inflated acquisitions multiple.

SEKm 2019 2020e 2021e
Sales 4180 4132 4464
Sales growth (%) 6,3 -1,1 8
EBITDA 717 727 790
EBITDA margin (%) 17,2 17,6 17,7
EBIT adj 489 488 532
EBIT adj margin (%) 11,7 11,8 11,9
Pretax profit 460 462 516
EPS rep 5,4 1,75 2,02
EPS growth (%) 7,3 -67,5 15,1
EPS adj 6,69 2,15 2,46
DPS 2,5 2,5 2,5
EV/EBITDA (x) 6,6 20,6 18,8
EV/EBIT adj (x) 9,6 30,7 28
P/E (x) 9 39 33,9
P/E adj (x) 7,3 31,9 27,9
EV/sales (x) 1,1 3,6 3,3
FCF yield (%) 5,7 1,3 4,2
Dividend yield (%) 5,1 3,6 3,6
Net IB debt/EBITDA 1,9 1,3 1,1
N/A N/A N/A
SEKm 2019 2020e 2021e
Sales 4180 4132 4464
COGS -2618 -2573 -2759
Gross profit 1562 1559 1705
Other operating items -845 -832 -915
EBITDA 717 727 790
Depreciation on tangibles -69 -75 -84
Depreciation on intangibles 0 0 0
EBITA 564 568 622
Goodwill impairment charges 0 0 0
Other impairment and amortisation -81 -80 -89
EBIT 483 488 532
Other financial items 0 0 0
Net financial items -23 -26 -16
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 460 462 516
Tax -94 -103 -103
Net profit 366 359 413
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 366 359 413
EPS 5,4 1,75 2,02
EPS Adj 6,69 2,15 2,46
Total extraordinary items after tax -6 0 0
Tax rate (%) -20,4 -22,3 -20
Gross margin (%) 37,4 37,7 38,2
EBITDA margin (%) 17,2 17,6 17,7
EBITA margin (%) 13,5 13,7 13,9
EBIT margin (%) 11,6 11,8 11,9
Pretax margin (%) 11 11,2 11,6
Net margin (%) 8,8 8,7 9,3
Growth rates Y/Y 2019 2020 2021
Sales growth (%) 6,3 -1,1 8
EBITDA growth (%) 24,7 1,4 8,7
EBIT growth (%) 7,1 1 9,2
Net profit growth (%) 7,3 -1,9 15,1
EPS growth (%) 7,3 -67,5 15,1
Profitability 2019 2020 2021
ROE (%) 22,9 20,2 22,7
ROE Adj (%) 28,4 24,7 27,6
ROCE (%) 16,6 15,7 17,9
ROCE Adj(%) 19,5 18,3 20,9
ROIC (%) 13,8 12,8 15,5
ROIC Adj (%) 14 12,8 15,5
Adj earnings numbers 2019 2020 2021
EBITDA Adj 723 727 790
EBITDA Adj margin (%) 17,3 17,6 17,7
EBITA Adj 570 568 622
EBITA Adj margin (%) 13,6 13,7 13,9
EBIT Adj 489 488 532
EBIT Adj margin (%) 11,7 11,8 11,9
Pretax profit Adj 547 542 606
Net profit Adj 453 439 502
Net profit to shareholders Adj 453 439 502
Net Adj margin (%) 10,8 10,6 11,3
N/A N/A N/A
SEKm 2019 2020e 2021e
EBITDA 717 727 790
Net financial items -23 -26 -16
Paid tax -94 -103 -103
Non-cash items 0 0 0
Cash flow before change in WC 600 598 671
Change in WC -53 -198 -13
Operating cash flow 547 400 658
CAPEX tangible fixed assets -92 -77 -62
CAPEX intangible fixed assets 0 0 0
Acquisitions and disposals -268 -134 0
Free cash flow 187 189 595
Dividend paid -169 -508 -508
Share issues and buybacks 0 0 0
Other non cash items -414 746 0
Decrease in net IB debt -396 427 87
Balance Sheet (SEKm) 2019 2020 2021
Goodwill 1510 1661 1827
Indefinite intangible assets 0 0 0
Definite intangible assets 766 449 160
Tangible fixed assets 338 408 420
Other fixed assets 23 18 18
Fixed assets 2779 2594 2399
Inventories 562 574 620
Receivables 891 918 982
Other current assets 0 0 0
Cash and liquid assets 117 191 278
Total assets 4349 4277 4279
Shareholders equity 1684 1870 1775
Minority 0 0 0
Total equity 1684 1870 1775
Long-term debt 1298 945 945
Pension debt 67 67 67
Convertible debt 0 0 0
Deferred tax 0 0 0
Other long-term liabilities 0 0 0
Short-term debt 0 0 0
Accounts payable 1158 1253 1350
Other current liabilities 0 0 0
Total liabilities and equity 4349 4277 4279
Net IB debt 1390 963 876
Net IB debt excl. pension debt 1323 896 809
Capital invested 3074 2833 2651
Working capital 295 239 252
EV breakdown 2019 2020 2021
Market cap. diluted (m) 3306 14012 14012
Net IB debt Adj 1390 963 876
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 4696 14975 14888
Capital efficiency (%) 2019 2020 2021
Total assets turnover (%) 101,9 95,8 104,3
Capital invested turnover (%) 149,9 139,9 162,8
Capital employed turnover (%) 143,3 133 150
Inventories / sales (%) 13 13,7 13,4
Customer advances / sales (%) 0 0 0
Payables / sales (%) 28,4 29,2 29,2
Working capital / sales (%) 5,6 6,5 5,5
Financial risk and debt service 2019 2020 2021
Net debt / equity (%) 82,5 51,5 49,4
Net debt / market cap (%) 52 6,9 6,3
Equity ratio (%) 38,7 43,7 41,5
Net IB debt adj. / equity (%) 82,5 51,5 49,4
Current ratio (%) 127 126,4 131,6
EBITDA / net interest (%) 3117,4 2814,2 4895,1
Net IB debt / EBITDA (%) 193,9 132,5 110,9
Interest cover (%) 2452,2 2198,5 3851,9
N/A N/A N/A
SEKm 2019 2020e 2021e
Shares outstanding adj. 68 204 204
Fully diluted shares Adj 68 205 205
EPS 5,4 1,75 2,02
Dividend per share Adj 2,5 2,5 2,5
EPS Adj 6,69 2,15 2,46
BVPS 24,87 9,17 8,7
BVPS Adj -8,74 -1,18 -1,04
Net IB debt / share 20,5 4,7 4,3
Share price 39,5 68,5 68,5
Market cap. (m) 2675 13967 13967
Valuation 2019 2020 2021
P/E 9 39 33,9
EV/sales 1,12 3,62 3,34
EV/EBITDA 6,6 20,6 18,8
EV/EBITA 8,3 26,4 23,9
EV/EBIT 9,7 30,7 28
Dividend yield (%) 5,1 3,6 3,6
FCF yield (%) 5,7 1,3 4,2
P/BVPS 1,96 7,47 7,87
P/BVPS Adj -5,58 -58,13 -65,88
P/E Adj 7,3 31,9 27,9
EV/EBITDA Adj 6,5 20,6 18,8
EV/EBITA Adj 8,2 26,4 23,9
EV/EBIT Adj 9,6 30,7 28
EV/cap. employed 1,5 5 5,1
Investment ratios 2019 2020 2021
Capex / sales 2,2 1,9 1,4
Capex / depreciation 133,3 103,1 74,1
Capex tangibles / tangible fixed assets 27,2 18,9 14,9
Capex intangibles / definite intangibles 0 0 0
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 20,4 18,4 20,1
N/A N/A N/A

Equity research

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Media

Lagercrantz - Interview with CEO Jörgen Wigh (in Swedish)
Lagercrantz - Company presentation with CEO Jörgen Wigh (in Swedish)

Main shareholders - Lagercrantz

Main shareholders Share capital % Voting shares % Verified
Anders Börjesson & Tisenhult-Gruppen 5.6 % 28.8 % 31 Oct 2020
SEB Fonder 14.6 % 10.3 % 31 Oct 2020
Swedbank Robur Fonder 11.3 % 7.9 % 31 Oct 2020
Fidelity Investments (FMR) 5.9 % 4.1 % 9 Oct 2020
Didner & Gerge Fonder 5.7 % 4.0 % 31 Oct 2020
Lannebo Fonder 5.3 % 3.8 % 31 Oct 2020
Handelsbanken Fonder 4.5 % 3.1 % 31 Oct 2020
ODIN Fonder 4.4 % 3.1 % 31 Oct 2020
Per Säve 2.0 % 1.9 % 31 Oct 2020
Lagercrantz Group AB 2.5 % 1.8 % 31 Oct 2020
Source: Holdings by Modular Finance AB