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Ovzon

Ovzon

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Rare combination of speed and mobility

Ovzon is supplier of mobile end-to-end satellite services. Through its self-developed terminal, the company’s patent-protected offering combines great mobility with high bandwidth. The company is looking to launch a proprietary satellite. Besides more than doubling Ovzon’s saleable capacity, having its own satellite would expand the total offering.

The market for mobile satellite communication services is large and growing, and many governments and media organisations have already announced that they will continue to invest in the coming years. Ovzon offers a unique solution for customers in need of a mobile satellite terminal with high bandwidth. That combination has not existed historically, and the company might capture significant market share.

Ovzon relies on satellite capacity from third parties to provide its communication services. Satellites are subject to operational risks while in orbit, many of which cannot be foreseen and may not be included in Ovzon's insurance policies. Almost all of the company’s sales are generated via IGC (a subsidiary to the operator Intelsat) and the sales agreement with IGC is subject to annual renewal. Furthermore, the company generates almost all of its revenues in USD, and reports in SEK.

Financials

SEKm 2020 2021e 2022e
Sales 160 201 720
Sales growth (%) -30,7 25,5 257,9
EBITDA -45 -27 424
EBITDA margin (%) -28 -13,4 58,9
EBIT adj margin (%) -32 -17,3 43,2
Pretax profit -110 -41 246
EPS rep -2,32 -0,7 4,2
EPS growth (%) -366 69,9 702,4
EPS adj -2,32 -0,7 4,2
DPS 0 0 0
EV/EBITDA (x) -73,4 -156,4 9,1
EV/EBIT adj (x) -64,3 -120,6 12,4
P/E (x) -32,5 -120,9 20,1
P/E adj (x) -32,5 -120,9 20,1
EV/sales (x) 20,6 20,9 5,3
FCF yield (%) -18,7 -12,6 9,2
Dividend yield (%) 0 0 0
Net IB debt/EBITDA 4 -11,7 -0,1
EBIT adj -51 -35 312
Lease adj. FCF yield (%) -18,8 -12,7 9,1
Lease adj. ND/EBITDA 4 -10,8 -0,1
SEKm 2020 2021e 2022e
Gross profit 51 85 549
Other operating items -96 -112 -125
EBITDA -45 -27 424
Depreciation on tangibles -1 -2 -96
Depreciation on intangibles -4 -4 -15
EBITA -51 -35 312
Goodwill impairment charges 0 0 0
Other impairment and amortisation 0 0 0
EBIT -51 -35 312
Other financial items 0 0 0
Net financial items -59 -6 -66
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit -110 -41 246
Tax 3 9 -52
Net profit -107 -32 194
Minority interest 0 0 0
Net profit discontinued 0 0 0
Net profit to shareholders -107 -32 194
EPS -2,32 -0,7 4,2
EPS Adj -2,32 -0,7 4,2
Total extraordinary items after tax 0 0 0
Tax rate (%) -2,7 -21 -21
Gross margin (%) 32,1 42,2 76,2
EBITDA margin (%) -28 -13,4 58,9
EBITA margin (%) -32 -17,3 43,2
EBIT margin (%) -32 -17,3 43,2
Pretax margin (%) -68,6 -20,2 34,1
Net margin (%) -66,7 -16 26,9
Growth rates Y/Y 2020 2021 2022
Sales growth (%) -30,7 25,5 257,9
EBITDA growth (%) -257,1 40,1 1676,8
EBIT growth (%) -549,2 32 992,8
Net profit growth (%) -466,3 69,9 702,4
EPS growth (%) -366 69,9 702,4
Profitability 2020 2021 2022
ROE (%) -10,3 -2,5 14,3
ROE Adj (%) -10,3 -2,5 14,3
ROCE (%) -4,9 -2,2 15,9
ROCE Adj(%) -4,9 -2,2 15,9
ROIC (%) -6 -2,1 16,5
ROIC Adj (%) -6 -2,1 16,5
Adj earnings numbers 2020 2021 2022
EBITDA Adj -45 -27 424
EBITDA Adj margin (%) -28 -13,4 58,9
EBITA Adj -51 -35 312
EBITA Adj margin (%) -32 -17,3 43,2
EBIT Adj -51 -35 312
EBIT Adj margin (%) -32 -17,3 43,2
Pretax profit Adj -110 -41 246
Net profit Adj -107 -32 194
Net profit to shareholders Adj -107 -32 194
Net Adj margin (%) -66,7 -16 26,9
Sales 160 201 720
COGS -109 -116 -171
Depreciation and amortisation -6 -8 -113
Of which leasing depreciation -2 -2 -2
EO items 0 0 0
Impairment and PPA amortisation 0 0 0
EBITDA lease Adj -47 -29 423
EBITDA lease Adj margin (%) -29 -14,2 58,7
Leasing payments -2 -2 -2
SEKm 2020 2021e 2022e
EBITDA -45 -27 424
Net financial items -59 -6 -66
Paid tax 3 9 -52
Non-cash items 46 0 -2
Cash flow before change in WC -55 -24 305
Change in WC -100 113 62
Operating cash flow -155 89 367
CAPEX tangible fixed assets -464 -544 -2
CAPEX intangible fixed assets -32 -37 -9
Acquisitions and disposals 0 0 0
Free cash flow -651 -492 356
Dividend paid 0 0 0
Share issues and buybacks 575 0 0
Other non cash items 6 0 2
Decrease in net IB debt -72 -494 356
Balance Sheet (SEKm) 2020 2021 2022
Goodwill 0 0 0
Indefinite intangible assets 21 53 52
Definite intangible assets 0 0 0
Tangible fixed assets 984 1526 1427
Other fixed assets 0 0 0
Fixed assets 1010 1585 1484
Inventories 0 0 0
Receivables 134 81 144
Other current assets 0 0 0
Cash and liquid assets 185 291 648
Total assets 1329 1956 2276
Shareholders equity 1293 1260 1454
Minority 0 0 0
Total equity 1293 1260 1454
Long-term debt 0 600 600
Pension debt 0 0 0
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 31 91 216
Other current liabilities 0 0 0
Total liabilities and equity 1329 1956 2276
Net IB debt -180 314 -42
Net IB debt excl. pension debt -180 314 -42
Capital invested 1113 1575 1412
Working capital 103 -10 -72
EV breakdown 2020 2021 2022
Market cap. diluted (m) 3478 3894 3894
Net IB debt Adj -180 314 -42
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 3298 4208 3852
Capital efficiency (%) 2020 2021 2022
Total assets turnover (%) 14,4 12,3 34
Capital invested turnover (%) 19,4 15 48,2
Capital employed turnover (%) 15,3 12,7 36,7
Inventories / sales (%) 0 0 0
Customer advances / sales (%) 0 0 0
Payables / sales (%) 37,4 30,3 21,3
Working capital / sales (%) 32,9 23,1 -5,7
Financial risk and debt service 2020 2021 2022
Net debt / equity (%) -13,9 24,9 -2,9
Net debt / market cap (%) -6,6 8,1 -1,1
Equity ratio (%) 97,2 64,4 63,9
Net IB debt adj. / equity (%) -13,9 24,9 -2,9
Current ratio (%) 1016,6 410,3 366,3
EBITDA / net interest (%) -76,5 -458,7 642,7
Net IB debt / EBITDA (%) 400,1 -1167,6 -10
Interest cover (%) -87,4 -595,2 472,1
Lease liability amortisation -2 -2 -2
Other intangible assets 21 53 52
Right-of-use asset 5 5 5
Total other fixed assets 0 0 0
Leasing liability 5 5 5
Total other long-term liabilities 0 0 0
Net IB debt excl. leasing -185 309 -48
Net IB debt / EBITDA lease Adj (%) 397,7 -1083,5 -11,3
SEKm 2020 2021e 2022e
Shares outstanding adj. 46 46 46
Fully diluted shares Adj 46 46 46
EPS -2,32 -0,7 4,2
Dividend per share Adj 0 0 0
EPS Adj -2,32 -0,7 4,2
BVPS 27,95 27,26 31,45
BVPS Adj 27,95 27,26 31,45
Net IB debt / share -3,9 6,8 -0,9
Share price 58,59 84,2 84,2
Market cap. (m) 2709 3894 3894
Valuation 2020 2021 2022
P/E -32,5 -120,9 20,1
EV/sales 20,55 20,9 5,35
EV/EBITDA -73,4 -156,4 9,1
EV/EBITA -64,3 -120,6 12,4
EV/EBIT -64,3 -120,6 12,4
Dividend yield (%) 0 0 0
FCF yield (%) -18,7 -12,6 9,2
P/BVPS 2,69 3,09 2,68
P/BVPS Adj 2,69 3,09 2,68
P/E Adj -32,5 -120,9 20,1
EV/EBITDA Adj -73,4 -156,4 9,1
EV/EBITA Adj -64,3 -120,6 12,4
EV/EBIT Adj -64,3 -120,6 12,4
EV/cap. employed 2,5 2,3 1,9
Investment ratios 2020 2021 2022
Capex / sales 309,2 288,6 1,5
Capex / depreciation 10401 9078,4 9,5
Capex tangibles / tangible fixed assets 47,1 35,7 0,1
Capex intangibles / definite intangibles 0 0 0
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 0,1 0,2 6,8
Lease adj. FCF yield (%) -18,8 -12,7 9,1

Equity research

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Media

Ovzon - Company presentation with CEO Magnus René & CFO Johan Brandt
Ovzon - Interview with VP Per Wahlberg

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Main shareholders - OVZON

Main shareholders Share capital % Voting shares % Verified
Investment AB Öresund 11.8 % 11.8 % 28 Feb 2021
Bure Equity 11.3 % 11.3 % 31 Dec 2020
AFA Försäkring 9.3 % 9.3 % 31 Dec 2020
Fjärde AP-fonden 8.8 % 8.8 % 31 Dec 2020
Futur Pension 8.4 % 8.4 % 31 Dec 2020
Handelsbanken Fonder 7.8 % 7.8 % 31 Mar 2021
Staffan Persson 6.1 % 6.1 % 31 Dec 2020
Stena 3.3 % 3.3 % 31 Dec 2020
Avanza Pension 2.4 % 2.4 % 31 Dec 2020
Alfred Berg Fonder 1.5 % 1.5 % 28 Feb 2021
Source: Holdings by Modular Finance AB

Insider list - Ovzon

Name Quantity Code Date
Per Wahlberg + 838 UTDEL 20 Nov 2020
Pål Ekberg + 79 617 UTDEL 20 Nov 2020
Kennet Lejnell + 75 585 UTDEL 20 Nov 2020
Per Wahlberg + 259 012 UTDEL 20 Nov 2020
Dan Jangblad + 650 BUY 14 Jul 2020
Per Wahlberg + 50 000 ALTM 3 Jul 2020
Magnus René + 100 000 ALTM 3 Jul 2020
Pål Ekberg + 50 000 ALTM 3 Jul 2020
Nils Norén + 909 BUY 25 Jun 2020
Nils Norén + 909 BUY 25 Jun 2020

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