Exel Composites

OP maintained its ‘Add’ recommendation after the results, as well as the target price of €0.45.

The Q1 result confirmed OP’s view that in 2025, revenue will grow significantly, as will adjusted profit. As a result of the earnings, OP raised its 2025 forecasts - by 2% for revenue and 18% for adjusted operating profit. The forecasts for 2026 and 2027 increased by one percent.

OP now expects Exel to generate revenue of €110 million and adjusted operating profit of €5.0 million in 2025. For 2026, the figures are €126 million and €7.1 million, respectively.

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Inderes is more skeptical. Reduce recommendation remains unchanged, but target price 0.35 € → 0.38 €.

At the same time, they also raise their annual forecasts.

  • For adjusted operating profit: 17% for 2025, 8% for 2026, and 5% for 2027.
  • For revenue, forecast increases are moderate: +1% for 2025, +1% for 2026, and +2% for 2027.

The risk of lagging behind has increased - forecasts are raised but a negative recommendation is maintained.

Edit: If one compares the forecasts of these two analysis providers, Inderes forecasts slightly better results for 2025 (5.2 M vs. 5.0 M), and also for 2026 (7.9 M vs. 7.1 M). So OP allows higher multiples.

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Let’s also add some brief comments on the results here on the forum. Indeed, the market situation had continued to pick up, similar to the end of the year. At the same time, it’s good to note that the growth in order intake is largely explained by the EUR 10 million wind power order announced earlier in the year (this is, of course, a positive thing). On the other hand, short-term market comments were understandably somewhat cautious, but the order book, which is at a higher level for the first time in a long while, provides some support, even though its structure is, in our estimation, longer than normal (e.g., a wind power order that spans several quarters). Despite this, the order book in Exel’s case is chronically quite short, which means that a prolonged period of current market uncertainty / escalation of the situation could quite quickly reflect on Exel’s business conditions. However, we estimate that the current uncertainty will resolve within a reasonable timeframe, so such a scenario has not been included in our current forecasts. This does, however, partly increase forecast risks. Nevertheless, we assume that the current situation will negatively impact Q2 development, at least in terms of new orders, but revenue growth will continue to accelerate from next year onwards, also reflecting the volume growth of production at the Indian factory.

Regarding the forecast changes made now, it’s good to note that the percentages were quite large, but the absolute changes were then considerably more limited :blush:

As for valuation, this year is still about gathering momentum, reflecting the market, and the overall valuation is elevated. Conversely, next year, with our current forecasts, the valuation will fall to the lower end of what we consider an acceptable range, which for now, in our opinion, is a fairly neutral level given the yet unproven clearer turnaround in earnings and the volatile earnings performance of recent years (incl. the aforementioned forecast risks). Our DCF model also speaks the same language. Of course, we recognize that the stock has potential in the medium and long term if the company can even come close to its ambitious targets (incl. an increase in valuation multiples due to a decrease in risk level and growth in profitability and capital returns), but the company still has a lot to prove regarding the achievement of these targets.

Otherwise, in my opinion, the implementation of the strategy has progressed well on schedule, and the company should, at least on paper, be in a better position than before in terms of cost profile and factory setup to achieve a sustainable turnaround in earnings when the market turns. However, in Exel’s case, it’s important to note the strongly investment-driven demand, the fluctuations of which the company finds difficult to manage, reflecting the aforementioned short structure of the order book. Furthermore, there is still a certain burden of proof, for example, regarding the successful ramp-up of the Indian factory and the margin profile of volume products (especially wind power). But overall, the underlying sentiment regarding the company’s own actions, for example concerning strategy implementation, is, in my opinion, on the positive side. Let’s see if the turnaround progresses faster than the undersigned expects, and recommendations will, of course, be reviewed regularly :blush:

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In a work meeting, the reconstruction boom caused by the end of the war in Ukraine was brought up, as well as the likely sharp rise in construction material prices resulting from it. I later started thinking about what kind of impact the reconstruction boom would have on Exel’s business. I asked Chat-gpt about it, which suggested that the impact on the company’s order flow would be truly significant, even by a conservative estimate. Chat-gpt based its estimate on a total material market of 65 billion USD, from which, in different scenarios, Exel would get a slice of 0.05%, 0.1%, and 0.5%. The high-end scenario might not even be within production capacity limits, but is there any truth to those more conservative scenarios? Chat-gpt also highlighted the improvement in the price competitiveness of composites if there is a significant price increase in traditional materials. This could generally increase the popularity of composites, but it’s difficult to estimate by how much.

What is analyst @Aapeli_Pursimo’s view? Have there been any discussions with the company about the potential effects of the Ukraine reconstruction boom?

What about the Pakistan-India conflict, what should one think about that? It feels quite challenging to price and evaluate the company’s future in the short term…

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Hello,

I can’t really comment on that ChatGPT assessment. But perhaps I can clarify that, based on the market sizes presented at Exel’s Capital Markets Day, the composite market alone (including all technologies and material combinations) was estimated to be approximately 85 billion dollars in 2022, and correspondingly, the pultrusion market size would have been around 4 billion dollars. Additionally, I would consider it likely that the prices of glass and carbon fiber applications would also rise if the prices of other building materials increased significantly.

Regarding the reconstruction of Ukraine, there seem to be more questions than answers. Naturally, the end of the war should be a positive driver for the European economy, but what kind and when are more difficult questions. Furthermore, it is still unclear who would finance the reconstruction and with what resources it would be carried out (e.g., financing methods and timing of financing availability, implementers of construction, materials to be used, etc.), as these would also have an impact on the matter. So, I would not yet start considering direct impacts for Exel regarding possible reconstruction, at least not in the short term. Reflecting on this whole, we have not discussed the impacts of reconstruction precisely with the company either, as assessing these impacts is very difficult.

The situation in Pakistan and India is naturally serious, and a larger escalation could then have significant impacts on the world order. However, at the current scale, the impacts are presumably limited. For example, Exel’s factory is not located in the Kashmir region, but further south near Goa. So, in the current situation, I do not assume the situation will actually have any impacts, and let’s hope the situation remains as such (or even better, if some lasting settlement could be achieved, but this, of course, seems unlikely given history).

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KL’s pick. Good news for Exel.

Equinor, formerly Statoil, is building the Empire Wind offshore wind farm in the United States, south of Long Island. The project’s total budget is approximately five billion dollars.

In April, the U.S. Department of the Interior ordered Equinor to halt the project. According to U.S. Secretary of the Interior Doug Burgum’s X update, the reason was that the ”Biden administration rushed the project’s approval without sufficient analysis”. The analysis reportedly refers to a sufficient assessment of environmental impacts.

On the first day of his new presidential term, Trump signed an order stating that the issuance of new offshore wind power permits must be suspended and those already granted must be re-examined, [Politico reports] Equinor threatens to cancel NY offshore wind project - E&E News by POLITICO

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Now it’s not clear how this is good news for Exel? Isn’t it bad news if it’s not built? Unless there’s some US domestic content requirement > Permit comes > Exel’s US factory gets orders from there.

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At the beginning of his term, Trump banned the granting of permits for the project, but has since reversed his decision. The project will therefore be implemented, and its scale – approximately five billion dollars – is so significant that it will be reflected in the growth of overall demand for wind power :+1:

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@Heikki_Keskivali’s tweet related to Excel :slight_smile:

https://x.com/hkeskiva/status/1939932654930948561
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Link to the tweet’s YouTube clip :slight_smile:
https://www.youtube.com/watch?v=J-KLIQ8yVaA

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Exel Composites was subject to a cyberattack in July 2025. As a precautionary measure, the company is publishing preliminary information on its half-year report for January–June 2025.

In the first half of 2025, Exel Composites’ order intake was EUR 63.0 million (H1 2024: 55.0), net sales were EUR 50.1 million (50.0), adjusted operating profit was EUR 1.8 million (0.8), and adjusted operating profit margin was 3.6% (1.6%).

“2025 has continued positively for Exel Composites. As in the first quarter, the business environment remained favorable, and our order intake grew by 15% in the first half of the year. Our net sales were at the same level as the comparison period. We were able to continue improving our results, and our adjusted operating profit increased significantly to EUR 1.8 million, already exceeding the adjusted operating profit for the entire year 2024,” says President and CEO Paul Sohlberg.

The company maintains its guidance for 2025 and estimates that in 2025, net sales will increase, and adjusted operating profit will increase significantly compared to 2024.

Exel Composites will publish its half-year report for January–June 2025 on Thursday, August 14, 2025.

Exel Composites was subject to a cyberattack in July, and investigations confirmed a data breach occurred on July 18, 2025. The unauthorized intrusion affected a limited number of workstations and servers. The company immediately took action in cooperation with internal and external experts to limit the breach, protect its systems from further exposure, and determine what information may have been compromised.

As a precautionary measure, Exel Composites has proactively published preliminary information on its half-year report for January–June 2025. In addition, the company announces that, as a result of the attack, personal data of personnel and shareholders, as well as certain business-related information, may have been leaked.

Exel Composites has filed a police report regarding the incident and notified data protection authorities. The company continues to cooperate with authorities and experts to investigate the incident and will inform identified and affected stakeholders as soon as possible. The company offers comprehensive support to its personnel and is currently exploring possibilities to extend similar support measures to shareholders whose data may have been compromised.

The cyberattack did not affect the company’s business operations, production, or the operational capacity of its factories.

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Net sales somewhat below the forecast, operating profit above. Order intake quite a bit smaller than Q1, but this might be due to seasonal variations because of summer holidays.

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Q2 adjusted operating profit was 1.1 M € and the expectation was apparently 0.8 M €.

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Exel Composites was targeted by a cyberattack in July
In this regard, a proactive credit freeze is not a bad option even for shareholders.

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The date (18.7) matches so precisely that it seems SharePoint has been compromised and then proceeded from there.

And since the reported date is one day before Microsoft’s published bulletin on the vulnerability which came out on 19.7., this can’t really be blamed on Exel. The biggest mistake is at most “trusting Microsoft’s products and their security”.

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It’s quite a grim situation that even shareholder information has leaked online. Normally, you can only get them by ordering from Euroclear, meaning the hacker got hold of a commissioned file. Quite a serious blunder, because don’t they also contain the owners’ addresses? They do provide good instructions on their website, kudos to Exel for that.

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Aapeli has commented on the data breach and the H1 preliminary information that the company provided due to the data breach.

The company announced on Friday that it had been subjected to a cyberattack. Based on current information, personal data of personnel and shareholders, as well as certain business-related information, have leaked in connection with the data breach. However, Exel’s business, production, or factory operations have not been disrupted as a result of the incident, and based on current information, it appears that the company could recover from the incident with relatively minor damage. Along with the data leak, the company also published preliminary information on H1 development, based on which the company’s operating profit slightly exceeded our forecasts. In addition, the company’s order flow appears to have remained at a reasonably good level, considering the increased uncertainties in the global economy. However, the cyberattack has no impact on the current year’s guidance. We will review our forecasts in connection with our Q2 preliminary comment, which we will publish in the coming days.

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From the release:

“Unfortunately, personal data of shareholders has also been leaked in the data breach. Exel Composites has initiated measures to investigate the matter and will be in contact with the affected shareholders. The company is exploring possibilities to extend the support it provides to also cover shareholders.”

Is there any information on how and when they will make contact, and has anyone received contact?

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No information, at least I haven’t received any myself. Nordnet has approximately 3000 Exel owners, and the staff numbers around 600. According to the company, about 10,000 personal data records have been leaked, mainly from Finland. From this, it can be concluded that a significant portion of all personal data has been leaked, if not all.

So, let’s prepare for the possibility that the owners’ data has been compromised.

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I was wondering how recent the leaked shareholder data is. I myself was involved for a while between 2019-2021. All we can do is wait and hope they announce in their communications when all affected parties have been informed. Either way, it’s an unfortunate situation.

I already have all sorts of prohibitions in place due to a previous data breach, mainly as a precautionary measure, and generally it’s good to keep them on, as modern times are so unkind to human beings.

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I was on board longer, from 2015-2020, and I would be surprised if my data had been stolen (which is probably not even left there anymore), so I don’t expect to be contacted.

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