Why, by the way, is the P/B 1 on Inderes and 1.4 at OP? Quite a big difference.
Good question. Could it be related to hybrid bonds? @Kasper_Mellas ?
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I doubt anyone is interested in this, but I’ll post it anyway. OK result.
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Here are Kassu’s quick comments on the results. 
Aspo released its Q2 results this morning, which were in line with our expectations. ESL’s earnings performance was better than expected, while Telko’s profitability fell short of forecasts. As expected, Aspo kept its earnings guidance unchanged, although it no longer expects the improvement in the market situation to provide significant support in the second half of the year. Consequently, the forecasted earnings improvement for the remainder of the year rests on the shoulders of new vessel capacity, completed acquisitions, and efficiency measures. Aspo’s results briefing can be followed starting at 10:30 am on InderesTV.
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The results and especially the 2024 profit target of €32 million look good, although the €7.8 million write-down from the Supramax vessel sale suggests that the vessels’ book values may have been slightly off. Overall, the approach is ambitious; the €1 billion revenue target for 2028 sounds quite tough. The financial position is good, as a company of this size has a bit over 100 million in debt, with interest expenses around 5 million.
I trust the case, buying a bit more.
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Kasperi has released a new company report on Aspo.
Aspo published Q2 results largely in line with our expectations, as the company’s profit grew significantly from a weak comparison period. Among the segments, ESL’s performance was a positive surprise, while Telko’s profitability fell short of our forecasts due to one-off items. The strong development of ESL in particular also led to an increase in our earnings forecasts for the coming years. However, the stock’s valuation does not yet encourage risk-taking, so we reiterate our reduce recommendation with a target price of EUR 6.5 (prev. EUR 6.0).
Quote from the report:
While we consider the company’s chances of reaching its guidance to be decent due to the factors mentioned above, the market situation must by no means deteriorate significantly. The risk of a profit warning thus still exists, although for the time being we do not assume such a thing in our own forecasts. Our own forecast expects a comparable EBITA of EUR 33.1 million for the current year.
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Tässäpä Nordean ajatuksia Asposta:
Aspo: Clean EPS close to consensus in Q2, full year 2024 guidance unchanged
“Aspo is concentrating on value creation by several divestments and acquisitions which we believe is a right strategy. However, several changes in the group structure increase the complexity and could reduce visibility.”
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Nordean päivitettyjä ajatuksia:
Aspo: Strategy execution is the key in the medium term
"The new strategy has led to many changes in the group structure and also in reporting. The increased complexity could even reduce visibility and lower the accepted valuation multiples, but the share price has considerable upside potential if the strategy execution is successful. Our current estimates point to a fair value range of EUR 7.3-8.9 per share, based on an equal weighting of our DCF, P/E and SOTP valuations.
The company’s aim is to maximise shareholder value by streamlining the balance sheet and optimising investments, and via further acquisitions and divestments. Aspo’s ambition is to increase EBITA by ~130% by 2028 compared to 2024, which is why its current valuation does not look overly challenging if the strategy execution is successful."
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Here are Evli’s thoughts on Aspo’s results:
Aspo: Q2 figures very close to estimates
“Aspo’s Q2 results were mostly as expected as ESL’s profitability topped estimates while Telko fell somewhat short. The EUR 7.4m comparable EBITA thus came in close to estimates.”
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Evlin päivitettyjä ajatuksia:
Aspo: Earnings are trending up
We continue to expect Aspo FY ’25 EBITA to gain by around EUR 15m y/y, more than half of which would be due to Telko as it has acquired some EUR 7.5m of EBIT this year (and added 40% to revenue). ESL shouldn’t find it too hard to gain by around EUR 4-5m in EBITA then as it will have received a few additional green coasters while the market could have improved a little more. Aspo is valued about 7x EV/EBIT on our FY ’25 estimates, which we view a rather low level. We retain our EUR 7.0 TP and BUY rating.
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Reminder! Rolf is coming to the ROAST this Friday 
!
You can post your questions in this thread, for example—remember to ping me so I’m sure to see them. I always go through the discussions as part of the background work for the ROAST.
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Hi Verneri, a question for Rolf. Why is the plan to call it Aspo Infra specifically rather than ESL? Aspo Infra sounds like it could include other companies besides ESL in the future. Could Rolf elaborate on this a bit?
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I didn’t actually come up with these myself; they were based on a post by a certain gentleman.
1. How much do you believe in Aspo’s leverage strategy and how do you see its impact on the company’s long-term sustainability, especially considering the capital-intensive nature of ESL?
2. How do you view the role of the hybrid bond in Aspo’s financing strategy, especially since members of the Board and Management Team have invested in it themselves? Do you think this is sound risk management or a hidden dividend, as some might interpret it?
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Aspo’s ROAST has been moved to next Tuesday!
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The last Mohican, or rather conglomerate – is the intention to continue as such? Why? Or would a demerger make sense at some point?
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Thanks for the questions and for watching the ROAST .
Time will tell how Aspo progresses toward its billion-euro revenue target and 8% adjusted operating profit margin. In Kasperi’s forecasts, the 2027e level is EUR 700 million and operating profit is just over EUR 40 million, implying a margin level of around 6%. Similarly, based on our forecasts, the return on invested capital is expected to be 10-11%. Aspo’s growth thus creates value, as that slightly exceeds the 9% required rate of return. If they succeed in capital allocation and efficiency, the stock would likely be considered almost on the cheap side.
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CEO Rolf Jansson will be appearing in the Stock Investor’s Week broadcast today starting at 12:40! You can ask him questions using the broadcast’s comment section here: Pörssisijoittajan viikko | Teollisuus & Konepajat 13.9.2024 - Inderes 
The presentation, including the Q&A session, can also be viewed later as a recording! 
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Here is a direct link to Jansson’s presentation on Aspo as an investment.
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A brief update on the Metsä Group collaboration regarding new vessels. However, a similar collaboration also exists with Navalis Shipping. Maritime freight for wood procurement is carried out through long-term commitments with operators (90% of Metsä Group’s wood procurement maritime freight is contracted).
Navalis appears to have three similar eco-friendly vessels (completed in 2024), and a fourth is still on the way. Correspondingly, ESL currently operates two, the third arrives in Loviisa next week, and the fourth was delivered to ESL in September. It is evident that there are several operators in the market with the same future prospects.
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A new hire has been found for the corporate development role. Interesting background, and in that regard, one would expect him to have the right capabilities.
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