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Proact

Proact

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Specialist in critical data storage

Proact is a value-added reseller (VAR) of storage and the largest storage specialist in Europe. It tailor-makes storage solutions for big companies with complex and critical storage requirements. Its sales consist of hardware and software sales of third-party products, consulting, support and cloud services. Financial targets: 1) Growth >10% p.a., 2) EBITA margin >8%, 3) Net debt/EBITDA <2x, 4) roce of 25%, and 5) 25-35% payout ratio.></2x,>

Proact is the largest storage specialist in Europe and is thus well positioned to capture growth in the data storage market. Proact has a fast-growing enterprise cloud solution that benefits from the strong cloud trend while also being local (on-premise or data centre) to avoid competition from global standardised cloud storage. An increasing share of cloud would raise margins.

For Proact’s traditional operations (system sales), the key risk comes from a potentially challenging outlook for the server/storage market given the shift towards cloud instead of local storage. For its cloud operations, there is the risk that some business will be lost to data centres and cheaper global cloud solutions.

Financials

SEKm 2020 2021e 2022e
Lease adj. FCF yield (%) 7,4 -2,4 7,3
Lease adj. ND/EBITDA -0,9 -0,8 -1,1
Sales 3633 3796 3950
Sales growth (%) 6,6 4,5 4,1
EBITDA 369 372 412
EBITDA margin (%) 10,2 9,8 10,4
EBIT adj 185 187 221
EBIT adj margin (%) 5,1 4,9 5,6
Pretax profit 168 181 220
EPS rep 14,37 14,93 18,17
EPS growth (%) 64,2 3,9 21,6
EPS adj 18,44 18,65 21,77
DPS 4,5 4,48 5,45
EV/EBITDA (x) 6,8 6,3 5,4
EV/EBIT adj (x) 13,7 12,5 10
P/E (x) 19 16,9 13,9
P/E adj (x) 14,8 13,5 11,6
EV/sales (x) 0,7 0,6 0,6
FCF yield (%) 11,5 2,1 11,8
Dividend yield (%) 1,6 1,8 2,2
Net IB debt/EBITDA 0,1 0,1 -0,2
SEKm 2020 2021e 2022e
Depreciation and amortisation -153 -151 -158
Of which leasing depreciation -104 -104 -104
EO items -3 0 0
Impairment and PPA amortisation -35 -34 -33
EBITDA lease Adj 268 268 308
EBITDA lease Adj margin (%) 7,4 7,1 7,8
Sales 3633 3796 3950
COGS -2701 -2936 -3030
Gross profit 932 860 920
Other operating items -563 -488 -508
EBITDA 369 372 412
Depreciation on tangibles -49 -60 -63
Depreciation on intangibles 0 0 0
EBITA 217 221 254
Goodwill impairment charges 0 0 0
Other impairment and amortisation -35 -36 -34
EBIT 182 187 221
Other financial items 0 0 0
Net financial items -14 -6 -1
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 168 181 220
Tax -35 -44 -54
Net profit 132 137 166
Minority interest -1 0 0
Net profit discontinued 0 0 0
Net profit to shareholders 132 137 166
EPS 14,37 14,93 18,17
EPS Adj 18,44 18,65 21,77
Total extraordinary items after tax -2,8 0 0
Tax rate (%) -21,1 -24,5 -24,5
Gross margin (%) 25,7 22,7 23,3
EBITDA margin (%) 10,2 9,8 10,4
EBITA margin (%) 6 5,8 6,4
EBIT margin (%) 5 4,9 5,6
Pretax margin (%) 4,6 4,8 5,6
Net margin (%) 3,6 3,6 4,2
Growth rates Y/Y 2020 2021 2022
Sales growth (%) 6,6 4,5 4,1
EBITDA growth (%) 36 0,7 10,7
EBIT growth (%) 72,7 2,9 18,1
Net profit growth (%) 65 3,4 21,6
EPS growth (%) 64,2 3,9 21,6
Profitability 2020 2021 2022
ROE (%) 23,4 21 21,9
ROE Adj (%) 30 26,3 26,2
ROCE (%) 15,6 16,2 17,9
ROCE Adj(%) 19 19,2 20,5
ROIC (%) 12,7 12 13,6
ROIC Adj (%) 12,9 12 13,6
Adj earnings numbers 2020 2021 2022
EBITDA Adj 372 372 412
EBITDA Adj margin (%) 10,2 9,8 10,4
EBITA Adj 219 221 254
EBITA Adj margin (%) 6 5,8 6,4
EBIT Adj 185 187 221
EBIT Adj margin (%) 5,1 4,9 5,6
Pretax profit Adj 205 215 253
Net profit Adj 170 171 199
Net profit to shareholders Adj 169 171 199
Net Adj margin (%) 4,7 4,5 5
Leasing payments -104 -104 -104
SEKm 2020 2021e 2022e
Lease liability amortisation -104 -104 -104
Other intangible assets 112 136 135
Right-of-use asset 225 225 225
Total other fixed assets 425 425 425
Leasing liability 258 258 258
Total other long-term liabilities 494 494 494
Net IB debt excl. leasing -236 -226 -354
Net IB debt / EBITDA lease Adj (%) -88,1 -84,2 -114,9
EBITDA 369 372 412
Net financial items -14 -6 -1
Paid tax -35 -44 -54
Non-cash items 0 0 0
Cash flow before change in WC 320 322 357
Change in WC 149 -76 8
Operating cash flow 468 245 365
CAPEX tangible fixed assets -60 -60 -60
CAPEX intangible fixed assets -31 -32 -32
Acquisitions and disposals -89 -105 0
Free cash flow 288 48 273
Dividend paid -23 -41 -41
Share issues and buybacks 0 0 0
Other non cash items -57 26 0
Decrease in net IB debt 186 109 138
Balance Sheet (SEKm) 2020 2021 2022
Goodwill 552 604 604
Indefinite intangible assets 0 0 0
Definite intangible assets 112 108 106
Tangible fixed assets 85 98 104
Other fixed assets 425 425 425
Fixed assets 1398 1488 1493
Inventories 13 27 28
Receivables 1044 1215 1264
Other current assets 0 0 0
Cash and liquid assets 468 458 586
Total assets 2924 3187 3371
Shareholders equity 602 697 823
Minority 3 3 3
Total equity 605 700 826
Long-term debt 142 142 142
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 33 33 33
Other long-term liabilities 461 461 461
Short-term debt 90 90 90
Accounts payable 762 797 829
Other current liabilities 573 705 731
Total liabilities and equity 2924 3187 3371
Net IB debt 22 32 -96
Net IB debt excl. pension debt 22 32 -96
Capital invested 1121 1227 1224
Working capital -277 -261 -269
EV breakdown 2020 2021 2022
Market cap. diluted (m) 2498 2311 2311
Net IB debt Adj 22 32 -96
Market value of minority 3 3 3
Reversal of shares and participations 0 0 0
Reversal of conv. debt assumed equity 0 0 0
EV 2523 2346 2218
Capital efficiency (%) 2020 2021 2022
Total assets turnover (%) 125,3 124,2 120,5
Capital invested turnover (%) 321,2 349 360,6
Capital employed turnover (%) 330 340,4 317,5
Inventories / sales (%) 0,5 0,5 0,7
Customer advances / sales (%) 15,8 15,8 16,7
Payables / sales (%) 21,4 20,2 20,7
Working capital / sales (%) -6,8 -7,1 -6,7
Financial risk and debt service 2020 2021 2022
Net debt / equity (%) 3,6 4,6 -11,6
Net debt / market cap (%) 1,3 1,4 -4,2
Equity ratio (%) 20,7 22 24,5
Net IB debt adj. / equity (%) 3,6 4,6 -11,6
Current ratio (%) 104,1 104 111
EBITDA / net interest (%) 2565,3 6100,4 41209
Net IB debt / EBITDA (%) 5,8 8,7 -23,3
Interest cover (%) 5152,5 5478,1 6429,8
SEKm 2020 2021e 2022e
Lease adj. FCF yield (%) 7,4 -2,4 7,3
Shares outstanding adj. 9 9 9
Fully diluted shares Adj 9 9 9
EPS 14,37 14,93 18,17
Dividend per share Adj 4,5 4,5 5,4
EPS Adj 18,44 18,65 21,77
BVPS 65,77 76,2 89,89
BVPS Adj -6,77 -4,73 9,07
Net IB debt / share 2,4 3,5 -10,5
Share price 178,72 252,5 252,5
Market cap. (m) 1636 2311 2311
Valuation 2020 2021 2022
P/E 19 16,9 13,9
EV/sales 0,69 0,62 0,56
EV/EBITDA 6,8 6,3 5,4
EV/EBITA 11,7 10,6 8,7
EV/EBIT 13,9 12,5 10
Dividend yield (%) 1,6 1,8 2,2
FCF yield (%) 11,5 2,1 11,8
P/BVPS 4,15 3,31 2,81
P/BVPS Adj -40,3 -53,42 27,85
P/E Adj 14,8 13,5 11,6
EV/EBITDA Adj 6,8 6,3 5,4
EV/EBITA Adj 11,5 10,6 8,7
EV/EBIT Adj 13,7 12,5 10
EV/cap. employed 2,3 2 1,7
Investment ratios 2020 2021 2022
Capex / sales 2,5 2,4 2,3
Capex / depreciation 186,4 196,2 170,7
Capex tangibles / tangible fixed assets 70,9 61,3 57,7
Capex intangibles / definite intangibles 27,6 23,5 23,6
Depreciation on intangibles / definite intangibles 0 0 0
Depreciation on tangibles / tangibles 57,7 47,9 51,8

Equity Research

Media

Proact - Company presentation with CEO Jonas Hasselberg
Proact - Interview with CEO Jonas Hasselberg (in Swedish)

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Main shareholders - Proact

Main shareholders Share capital % Voting shares % Verified
Martin Gren (Grenspecialisten) 11.2 % 11.2 % 31 Mar 2021
Livförsäkringsbolaget Skandia 11.0 % 11.0 % 31 Mar 2021
Länsförsäkringar Fonder 9.0 % 9.0 % 31 Mar 2021
Triton 7.0 % 7.0 % 11 Dec 2019
Skandia Fonder 7.0 % 7.0 % 31 Mar 2021
Unionen 4.0 % 4.0 % 31 Mar 2021
Alcur Fonder 3.1 % 3.1 % 31 Mar 2021
Canaccord Genuity Wealth Management 2.7 % 2.7 % 28 Feb 2021
Allianz Global Investors 2.4 % 2.4 % 31 Mar 2021
Fondita Fonder 2.0 % 2.0 % 31 Mar 2021
Source: Holdings by Modular Finance AB

Insider list - Proact

Name Quantity Code Date
Linda Alexandra Höljö + 450 BUY 7 May 2021
Jonas Hasselberg + 2 000 BUY 7 May 2021
Jonas Hasselberg + 1 200 BUY 23 Apr 2021
Dmitrijs Sarafutdinovs - 340 SELL 26 Feb 2021
Peter Mikael Javestad - 5 360 SELL 14 Feb 2021
Peter Mikael Javestad - 5 360 SELL 12 Feb 2021
Petra Tesch - 100 SELL 29 Dec 2020
Eva Maria Cecilia Sandell Elmstedt + 1 000 BUY 27 Oct 2020
Eva Maria Cecilia Sandell Elmstedt - 905 SELL 27 Oct 2020
Linda Alexandra Höljö + 420 BUY 4 Aug 2020

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