Elanders

Ahead of Elanders' Q4 report, we lower 2025E adjusted EBITA by 2% and 2026E-27E by 6%, due to FX and a slightly more cautious demand recovery over the short term. Following four quarters of double-digit y/y declines in adjusted EBITA, we expect flat earnings for Q4. However, looking into 2026, we look for more favourable comps, while the recent margin-enhancing structural measures should support group profitability. Thus we expect Elanders to enter a period of more positive earnings growth; we pencil in 40% y/y growth for H1 2026 and a 140bp group margin uplift by 2027, equivalent to a 2025E-27E adjusted EBITA CAGR of 12%. Despite 2026E lease-adjusted net debt/EBITDA of 3.2x, we continue to argue that Elanders is emerging with a more asset-light business model and better able to capitalise on rebounding demand going forward. We lower our multiples-based fair value range to SEK 49-89 (52-95), implying 2026E EV/EBITA of ~10-12x.

We raise adjusted EBITA by 1% for 2026E-27E, following the impressive 80bp y/y margin uplift in Supply Chain Solutions (SCS), supported by previously announced cost savings in LGI. Although underlying markets remain fairly muted, Elanders commented that it saw increased demand during the latter part of Q3. Added to this the additional cost savings in LGI presented in the Q3 report, we find further support for the company's positive margin trajectory from here – we pencil in a 150bp margin uplift between 2025 and 2027. In the short term, we expect a positive earnings inflection point in Q4 2025. However, given 2026E lease-adjusted net debt/EBITDA of 3.1x, leverage remains elevated. We raise our multiples-based fair value range to SEK 52-95 (SEK 49-91), implying 2026E EV/EBITA of 10-11x.

We trim adjusted EBITA by 2% for 2025E-27E on the back of recent FX movements. We take a slightly more cautious view on short-term demand, pencilling in a 15% y/y adjusted EBITA decline for Q3. Although there is clearly demand uncertainty, exacerbated by the recent geopolitical environment, we pencil in a positive inflection point for EBITA for Q4 2025, supported by margin-enhancing initiatives in recent years. We see a likelihood of further finetuning, as the company has overcapacity in several regions. We believe volumes will return, though, so we remain positive towards the longer-term margin trajectory, particularly related to Supply Chain Solutions (SCS). We pencil in a 130bp group margin uplift between 2025 and 2027. As such, we look for a 14% adjusted EBITA CAGR for 2025E-27E. We set a lower multiples-based fair value range of SEK 49-91 (52-98), implying 2026E EV/EBITA of 10-11x.

We lower adjusted EBITA by a mere 1% following the Q2 report, which saw adjusted EBITA drop by 22% y/y owing to weakness across most segments. Although short-term sentiment remains weak, particularly given the sequential drop in Industrial, along with the ongoing weakness in Automotive and Fashion in the US, the latter looks to be embarking on a slightly more positive trend in H2 2025 and 2026. While the geopolitical situation adds to the short-term uncertainty, we stick to our longer-term view and look for a more asset-light business model to emerge, following Elanders' streamlining of operations, which we continue to expect will lead to a positive longer-term margin trajectory. With 2026E lease-adjusted net debt/EBITDA of 3.1x, leverage remains elevated, and thus we expect the balance sheet to remain a key focus for the company. Our multiples-based fair value range decreases to SEK 52-98 (53-103), implying 10-11x 2026E EV/EBITA. Marketing material commissioned by Elanders.

Ahead of Elanders' Q2 2025 report, we lower adjusted EBITA by 2-5% for 2025E-27E, as we take a slightly more cautious view on our short-term estimates due to the prevailing geopolitical and tariff uncertainty. Although we look for negative adjusted EBITA growth of 19% y/y, primarily led by Fashion in the US and a weaker automotive market, Elanders is gradually facing easier comps with Q4 2025 the likely inflection point. We note several margin-enhancing initiatives in recent years, and see the likelihood of further fine-tuning, as the company has overcapacity in several regions. Once volumes return, we remain positive on the longer-term margin trajectory particularly related to Supply Chain Solutions (SCS) and pencil in a 130bp group margin uplift between 2025 and 2027. As such, we look for a 14% adjusted EBITA CAGR for 2025-27. We set a lower multiples-based fair value range of SEK 53-103 (56-113), implying 10-11x 2026E EV/EBITA. Marketing material commissioned by Elanders.

We lower adjusted EBITA by 6-13% for 2025E-27E following the Q1 report, which was weaker than expected, with adjusted EBITA declining 26% y/y. Although short-term sentiment remains weak, with particular weakness in Automotive and Fashion in the US, the geopolitical situation adds another layer of uncertainty. However, this paves the way for Elanders to continue streamlining its business. As such, we stick to our longer-term view and look for a more asset-light business model to emerge, while we continue to expect a positive longer-term margin trajectory. With 2026E lease-adjusted net debt/EBITDA of 2.8x, leverage remains elevated, and thus we expect the balance sheet to remain a key focus for the company. Marketing material commissioned by Elanders.

We lower adjusted EBITA by 6-11% for 2025E-27E, owing to recent FX movements, while we take a somewhat more cautious short-term view on demand and margins, pencilling in a 14% y/y adjusted EBITA decline for Q1 2025. Although short-term sentiment remains weak, bolstered by the weakness in Automotive and Fashion in the US, we continue to be encouraged by the fact that Elanders is streamlining its business by phasing out low-margin businesses, most recently the structural measures related to its German transportation business, and we continue to look for Elanders to emerge stronger in a rebounding environment. As such, we forecast an 8% adjusted EBITA CAGR between 2024 and 2027. With 2025E lease-adjusted net debt/EBITDA of 3.3x, short-term leverage remains elevated and provides limited upside optionality from M&A. We derive a lower multiples-based fair value range of SEK 69-124 (78-135), implying 2026E EV/EBITA of 10-12x. Marketing material commissioned by Elanders.

We lower adjusted EBITA by 5% for 2025E-27E following the Q4 report. During the quarter, the weaker automotive market and headwinds related to the NA fashion business caused adjusted EBITA to drop by 15% y/y. However, with bright spots appearing in most of Elanders' remaining markets, coupled with generally lower interest rates, we remain optimistic about an eventual demand recovery in 2025. Following the recent years' structural changes, we look for a more asset-light business model to emerge, while we continue to expect a favourable longer-term margin trajectory. With 2025E lease-adjusted net debt/EBITDA of 3.6x, leverage remains elevated, and thus we expect the balance sheet to remain a key focus for the company. Marketing material commissioned by Elanders.

Ahead of Elanders' Q4 report, we lower 2024E adjusted EBITA by 2%, while we raise 2025E-26E by 2%. We expect Q4 earnings to remain flat y/y, although we expect Supply Chain Solutions to drive group organic growth of 2%, supported by a slight recovery in demand from Electronics and Fashion in Europe. With generally lower interest rates, we are cautiously optimistic about a demand recovery demand in 2025. Longer term, we remain encouraged by Elanders' ongoing transformation following its recent margin-accretive acquisitions and further structural measures to streamline operations – reducing its automotive exposure while raising margins. We pencil in a 2024-26 adjusted EBITA CAGR of 14%. With 2025E lease-adjusted net debt/EBITDA of 3.2x, we look for Elanders to continue deleveraging its balance sheet. We nudge our multiples-based fair value range up to SEK 81-142 (SEK 77-136), implying 2025E 10-12x EV/EBITA. Marketing material commissioned by Elanders.

Today (16 December), Elanders announced that it has implemented structural measures regarding its road transport operations in Germany – specifically concerning its subsidiary LGI. These measures are in line with the group’s strategy to reduce the share of services with lower profitability and increase the share of value-added services. As a consequence of the closure, sales is expected to decrease by SEK ~450m in 2025 (i.e. ~3% of group sales in 2025E) and SEK ~900m thereafter on an annual basis (i.e. ~6% of 2026E group sales). This will also imply a significant reduction to its current automotive exposure, which is inevitably facing challenges. The structural measures will likely lead to one-off costs of SEK 45m and burden the Q4 2024 result. Conclusion: We are encouraged by Elanders continuing to reduce its exposure to the depressed automotive market, and we foresee sales to this market being reduced from ~19% of group sales (Q3 2024 LTM) to ~13%. We also view this as a logical step in terms of margins, as we fear the weak automotive market might result in increased pressure on the profitability of its road transportation business, once new contracts are renegotiated. With further actions to streamline operations towards more value-added services within contract and technical logistics, we find this supportive for longer-term margins. As such, by assuming a low-single-digit margin for the German road transport operations, we foresee ~40bp margin upside to our current estimates for 2026.