Are there any Robit shareholders on the forum and/or those planning to become one? Additionally, it would be interesting to hear opinions on the company’s current state or future direction. The firm doesn’t seem to have any analyst coverage, so it isn’t exactly basking in the limelight. I opened a small position in the company as a “lottery ticket” for my portfolio. The market cap relative to revenue isn’t really unreasonable, but the bottom line definitely needs some improvement.
Robit’s products are apparently good, and there shouldn’t be any issues in that regard.
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I also recently looked into this. The company has taken good steps by consolidating production and reducing staff after the acquisition of Halcon. The CEO has also been replaced, and hopefully has a strong desire to prove themselves. The balance sheet is in good shape. Before this M&A spree, this company used to achieve a solid profit margin (7.2% in 2016). In 2018, however, they were in the red at the EBITDA level. The company now seems to have sales organizations almost everywhere in the world. Perhaps a bit too much for its size, which weighs on the results.
In my opinion, this doesn’t seem terribly cheap yet. If we could reach a 5% net profit margin, which would be a really strong improvement, we would be at roughly P/E 10 with the current market value. I decided to keep monitoring the development. Of course, one could open a small position to follow it more closely. There could be potential in this case.
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"To me, Robit is a speculation stock. They bought foreign companies and it went as it often does for Finnish companies in acquisitions. Digesting the deals almost brings the company down.
However, there is growth potential in the results."
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"The company’s acquisitions have been nowhere near to bringing down the company. Robit still has a strong balance sheet even after the write-downs of recent years, and now there isn’t much goodwill left.
There is a lot of growth potential in the results, but a more interesting question is how much of this potential has already been priced into the current share price. My view on this is that the current share price already prices in potential quite strongly."
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Would you like to justify why you think this is a fiver, and on what timescale? 
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I looked into the stock, and it seems that SEB has dumped a large part of its holdings on the market over the year.
SEB ownership:
31.7.2019 - 14.77%
31.12.2019 - 6.68%
31.3.2020 - 6.52%
30.4.2020 - 6.31%
31.5.2020 - 5.90%
30.6.2020 - 4.52%
Does anyone know why? This has certainly also kept the price down.
Robit only makes wear parts for drilling rigs. The key is whether they can sell these to the market, as competition is fierce. Robit missed the peak cycle of 2018-2019, when sales didn’t pick up and the stock naturally took a hit. Men were replaced, but is there still enough demand for the products, that’s probably the key question. In this company, you should know the management well to dare to invest.
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I can’t say the reason in Robit’s case. But in a few companies, the stock price has stagnated, I understand, because funds bought, well, let’s say quality companies in March. Of course, then they have to sell others to maintain balance, and they might not necessarily care about the price.
Sometimes I used to look at SEB’s sales and ownership list, and I think they were nominee registered 
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Athanase Industrial Partner is selling shares through SEB. They reported in June when it went below 5%.
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Hi,
Eileen was added to Robit, and I wrote a few thoughts about it in the buy and sell thread, but here are some more thoughts on Robit.
Robit’s products are top in the industry, and the latest proof of this is the results of a drilling test organized by Robit’s Chilean distributor Full Safety,
“Last February, Robit’s Chilean distributor Full Safety organized a drilling test at El Teniente. The test, between four different manufacturers - Robit and three other globally known brands - was carried out by Astaldi, El Teniente’s main contractor. The test was performed with a Sandvik DD321 jumbo and an HLX5 drilling rig. Test conditions were standardized for each manufacturer’s products. It was a simple wear test measuring how far each tool drills without sharpening or changing. Several pieces of the selected tools were used, and the results were calculated as an average for each tool type. I am pleased to share the results announced by Astaldi: Robit’s crowns drilled an average of 315 meters, and rods and sleeves an average of 1,724 meters. In the bedrock of El Teniente, this is an excellent result. Astaldi confirmed that Robit’s wear parts performed significantly better than their competitors in the test.”
Source:
Yep, before the acquisitions made in 2016 - 2017, Robit consistently made a profit and distributed dividends for decades. The problems started when the former CEO and the old board approved the acquisitions as clearly overpriced, and the resulting write-downs and reorganizations have weighed on the results until last autumn.
I think Next Games is literally a speculative stock, and I wouldn’t even see Robit as a very cyclical company, because their products are essential consumables.
The mining industry is known to be cyclical, but that’s more in terms of results than production. Rarely is a mine closed due to ore prices (unless the company gets into financial difficulties), but production continues, and the mining industry, which uses large drill bits, constantly needs wear parts.
According to Sandvik, the market began to recover close to normal towards the end of Q2.
“Covid-19 update: Production was impacted only to a minor extent during the quarter, and both supply and distribution proceeded as planned. Mine closures in the first half of the quarter had a negative impact on both equipment and aftermarket, but showed signs of recovery in the second half.”
I’ll go one better and would see this as a stock over 10€ in the coming years, IF growth and profitability go well. Now it seems that growth is on a good track for Robit, but there are still many challenges regarding profitability.
Equity (31.3.2020) per share: 2.26 EUR
Revenue per share (2019): 4.10 EUR
Balance sheet per share (2019): 5.09 EUR
Losses have mainly come from depreciations and impairments, which has lightened the balance sheet, but the company still faces a considerable debt burden.
Loan arrangements were announced last month, and the situation in that regard seems to be under control,
https://www.robitgroup.com/investor/tiedotteet/porssitiedotteet/?investor=tiedotteet/tiedote&id=2049335&lan=fi
Q1 order book grew, and the outlook was also positive, which raised the share price to almost 3€ before the March collapse,
https://www.robitgroup.com/?investor=tiedotteet/tiedote&id=2021018&lan=fi
“The performance of our products is on the same level as the largest players in the market. We tell customers directly that we deliver a product of the same quality five percent cheaper than competitors. Our message is very simple, and simple messages usually work,” says Tommi Lehtonen, who started as CEO in May.
“Quite a few of our employees have been in companies that have worked with 30 percent market shares, so ten percent feels quite modest, but the first goal must be set somewhere. The market does not limit our growth. We have sufficient production capacity, good products, and the widest selection in this sector in the world.”
“A company in the industry must be able to offer thousands of different drill parts, as products are selected, for example, according to hole size and rock quality. This is a big hurdle for new competitors. Robit can also, as a relatively small company, easily customize parts for customers.”
“The company has hired many foreign experts in Lempäälä, whom it has found through its talent program. The company receives praise for the Tampere region, where technical university education and a number of companies in related fields provide an excellent framework for Robit.”
Source (unfortunately behind a paywall):
I have a strong view that Kim Gran hasn’t joined Robit’s board just for a hobby.
https://www.robitgroup.com/wp-content/uploads/2020/01/ANSIOLUETTELO_kimGran_fi.pdf
Robit also has a clear owner-entrepreneur who is willing to lose millions if he fails. When money is the motive, it certainly keeps the mind sharp.
As I mentioned earlier in the buy and sell thread,
Owner 25. Yli-opas Timo Kristian 40,000 pcs +11,502 pcs increase in ownership +40.36%
Timo is the chairman of the board of Konepaja Stamac Oy, and Stamac manufactures wear parts for Robit as a subcontractor.
Erkki Sinkko had also increased his stake in Robit.
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What multiples and results do you see us achieving this with? P/B of 4 is quite high for a company manufacturing consumables, whose competitive advantages are a bit iffy.
If only the situation were so good that there would be a good result at the EBITDA level. However, the situation is this:
EBITDA 2017: €1.6M
EBITDA 2018: -€4.8M
EBITDA 2019: €1.6M
EBITDA 2020Q1: €1.0M.
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“Quite a few of our employees have worked in companies with 30 percent market shares, so ten percent feels a bit shy, but the first goal has to be set somewhere. The market does not limit our growth. We have sufficient production capacity, good products, and the widest selection in this sector globally.”
(Above, a linked Kauppalehti article about Robit)
This comment, in my opinion, aptly describes the unofficial goals and attitude that Robit’s current management has set for themselves to return Robit to its old roots. I have the view that Robit has room to grow and gain market share. Focusing on sales is, in my opinion, the completely correct solution in the current situation when there is capacity to increase production and the products have proven to be good. (You seemed to criticize this focus on sales earlier, and I wonder greatly why?)
I expect strong growth from Robit in the coming years and am willing to accept that the value investor’s key figures will not yet come through in the next couple of years. What kind of valuation multiple are you willing to give to a company manufacturing critical wear parts if they even get close to this 30% market share and start distributing sustainable dividends in the future?
I personally don’t give much weight to these EBITDA figures from past years, as they are heavily influenced by the old board’s clearly overpriced acquisitions made in 2016-2017 and the old failed strategy.
If you still want to examine these EBITDA figures, I recommend you look a little further back into the company’s history, from before these mistakes:
EBITDA 2014: €3.82M
EBITDA 2015: €3.45M
EBITDA 2016: €6.77M
EBITDA 2017: €1.6M
EBITDA 2018: -€4.8M
EBITDA 2019: €1.6M
EBITDA 2020Q1: €1.0M.
And wasn’t a certain well-known investment legend of this opinion about EBITDA in general? 
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Thank you for the relevant information and comments. An interesting situation for the company.
I apologize for being nitpicky, but there’s a small typo here. > 400000? 40000
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Heh, yeah, there’s been a slight comma error here and it’s a good example of why you should question everything you read. Fortunately, you can check the situation with the largest owners from the site.
And even though I have a fairly positive view of the company, it’s worth remembering that Robit is still a fairly indebted company and proof of profitability from the new strategy is lacking. I expect clear growth from the H1 results, but I believe profitability will still remain weak. In my opinion, this would already be a good result considering the global situation and the kind of change Robit has gone through in recent years.
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That was a good pick! It could indicate that the company is currently trying to gain market share at the expense of price, which naturally pressures the margins that have been examined here.
It says there that the target is 10% market share. This would correspond to a revenue of €220M, meaning a 2.5-fold increase in revenue. There’s a lot of work to do before considering larger market shares. (Market area sizes are taken from the 2019 annual report.)
In 2016, a net margin of 7.2% was achieved (this was before acquisitions, so it’s not a perfectly comparable company). If revenue grows somewhat as it has now, reaching €100M in a couple of years, and a 4% net margin is achieved, the stock could well rise to around €3, at which point the P/E would be around 15. So there is some potential. A 4% net margin might be conservative, but in my opinion, the current earnings performance doesn’t encourage assuming a higher margin even a couple of years from now.
I brought up these EBITDA figures because you wrote that the poor result was mainly due to depreciation and impairments. There has been more to it than that.
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I got a feel for the situation, not high on glue, before Q2. Excerpts from the pages:
Is this news only in English? Production records were made at the Korean factory between 2/2020 and 4/2020.
From the June 17th bulletin:
“Our employees around the world have remained healthy and the factories are operating on schedule. Fortunately, many of our customers across the world have also been able to continue their operations and our business has remained at a good level.”
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July’s turnover so far is a little over half a million shares. Enska had just under a million shares left at the end of June. Has anyone been following more closely how much he has sold since the turn of the month?
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In one month -863,155 euros, or about 420k, probably missing at least some of today’s sales.
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Thanks, I remembered there was some Swedish site where you could check these daily.
That seller had 9.6 million shares left, so the numbers should be reflected in that. Enska’s board registers have other holdings.
Edit: clarification that 9.6 means June 9th.