fbpx

Written by 08:00 Analys, Research

AGTIRA: Solid ending to 2023 before scaleup in 2024

After several commercial contracts signed in 2023, Agtira ended the year with a strong cash position and only a few passing weaknesses in the report for Q4’23. Along with the contract with Swedish LIDL signed last month, worth some SEK 400m over 10 years, we now look forward to a scaleup in 2024. With a steep increase in cultivated area over the coming years, we expect Agtira to reach close to SEK 100m in ARR by the end of the year, with good prospects for profitability in 2025. Overall, we continue to find support for a fair value of SEK 14-16 per share.

Johan Widmark | 2024-02-15 08:00 

This commissioned research report is for informational purposes only and is to be considered marketing communication. This research report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and Emergers is not subject to any prohibition on dealing ahead of the dissemination of investment research. This research does not constitute investment advice and is not a solicitation to buy shares. For more information, please refer to disclaimer.  


Slightly lower capacity utilization in Q4

Due to replanting necessitated by a plant disease at the facility in Härnösand, the capacity utilization amounted to 69%, which can be compared to 87% the year before. This resulted in revenues that were slightly lower than we had anticipated, with full year sales at SEK 35.5m as opposed to our forecast of SEK 39.6. EBIT amounted to a loss of SEK -33m, slightly stronger than our estimate at SEK -35m. Following the rights issue concluded in Q4’23, cash position is now at SEK 47m (net cash SEK 33m) meaning that the company should be financed until positive cash flow can be reached.

Several significant launches in the coming two years

We now look forward to the establishment of three new production facilities, the ICA Maxi in Haninge, the Greenfood system in Boden, and the Coop Nord system in Umeå. Should these three be completed in 2024 that would mean a basis of almost SEK 97m in annual recurring revenue (ARR) towards the end of the year. This would then be followed by the establishment of a 10,000 square meter production facility for LIDL Sverige’s all 205 stores, which would add another estimated SEK 40m in annual sales (Est 4m in sales / 1,000 sqm equals SEK 400m in revenue of the 10-year contract length).

Strong outlook in the Nordics

Although the Swedish market alone holds the potential to propel Agtira into the realm of a billion SEK company, the company is strategically looking towards long-term expansion into the Nordic countries. An initial LOI with a Norwegian retailer was signed in 2022. With robust ownership backing, Agtira is poised to make 2024 the year where the growth story truly takes off. All in all, we continue to find support for a fair value range of SEK 14-16 per share.

DISCLAIMER

This commissioned research report is for informational purposes only and is to be considered marketing communication. This research does not constitute investment advice and is not a solicitation to buy shares. Information provided here or on Emergers’ website emergers.se is not intended to be financial advice. This research shall not be construed as a recommendation or solicitation to invest in the companies described. Emergers cannot be held liable for either direct or indirect damages caused by decisions made on the basis of information in this analysis. Investors are encouraged to seek additional information as well as consult a financial advisor prior to any investment decision.

This material is not intended to be financial advice. This material has been commissioned by the Company in question and prepared and issued by Emergers, in consideration of a fee payable by the Company. Emergers charges a standard fee for the production and broad dissemination of a detailed note following by regular update notes. Fees are paid upfront in cash without recourse. Emergers may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained herein represent those of the research analyst at Emergers at the time of publication. The company has been given the opportunity to influence factual statements before publication, but forecasts, conclusions and valuation reasoning are Emergers’ own. Forward-looking information or statements contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Emergers shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained in this material.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Emergers’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in this material may not be eligible for sale in all jurisdictions or to certain categories of investors. Investors are encouraged to seek additional information as well as consult a financial advisor prior to any investment decision.

Investment in securities mentioned: Emergers has a restrictive policy relating to personal dealing and conflicts of interest. Emergers does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Emergers may have a position in any or related securities mentioned in this report, subject to Emergers’ policies on personal dealing and conflicts of interest.

Copyright: Copyright 2023 Incirrata AB (Emergers)

United Kingdom
This document is prepared and provided by Emergers for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the ”FPO”) (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States
Emergers relies upon the ”publishers’ exclusion” from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Emergers does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Read Less Read More

For new research on growth stocks, sign up to our newsletter