Ework Group: Weathering storms adeptly - ABG

Adj. EBIT +3% y-o-y, despite a 7% sales drop y-o-y
We make small estimate revisions
+16% adj. EBIT growth in '24e, 11x EV/EBIT adj.


Earnings holding up well on cost savings

With Q1 sales -7% y-o-y, the Q1 report was lukewarm. The market environment for consultants has recently deteriorated, and Ework is also seeing a headwind to its Norwegian operations following the legalisation change. In addition, there was a negative calendar effect in Q1 (-2% y-o-y), while sectors that have historically been resilient across business cycles, i.e. telecom and public sectors, remained weak. That said, Ework has recently taken several actions to protect its profitability in a weaker market, with the SEK 60m in annual cost savings gradually starting to contribute, so adj. EBIT of SEK 55m grew 3% y-o-y. Furthermore, we note much easier comps in Q2 (partly due to a positive calendar), while the automotive and life science sectors continue to show encouraging resilience.