• Moderately negative estimate revisions
• Utilisation rate remains stable
• NTM EV/EBITA of ~9x, FVR SEK 120-190

Selective recruitment in H2'25

Q2 missed on sales and adj. EBITA compared to FactSet consensus' expectations. Organically, sales declined ~11% and the adj. EBITA margin was 4.7%, which was ~2.5pp below consensus. The utilisation rate is stable, and that bodes well for some selective net recruitment, which we expect will be at a low level in H2'25 (fewer than 10 FTEs y-o-y). While the main surprise was B3 Poland losing two large contracts, we believe that the position that B3 Poland has is sufficiently strong to eventually recover from the contract losses.

Delayed recovery: '25e-'27e adj. EBITA down 28-9%

Following the report, we lower '25e/'26e/'27e adj. EBITA by 28%/13%/9%. Due to adj. EBITA being at relatively low absolute numbers in '25e, the lowering of the estimate may seem large in relative terms. More specifically, we believe that net recruitment will materialise at a meaningfully lower pace than we had previously assumed. We also assign a slightly lower sales growth rate and margin profile to B3 Poland in order to account for the risk of B3 Poland not recouping contracts similar to the ones it lost at the beginning of the year. Ultimately, both of these factors translate into a somewhat lower margin, as B3 does not get to fully scale on its fixed cost base. Moreover, EPS comes down at a somewhat higher rate, as we revise our estimates relating to P&L from shares in associates. We retain our positive view of the business despite the volatile earnings profile.

Valuation

Based on our revised estimates, the company is trading at ~9x NTM EV/EBITA, which is ~20% below current peer multiples and ~25% below the historical average for Nordic IT services peers. We revise our fair value range to SEK 120-190 due to the negative estimate revisions.