Aspo - Major earnings beat due to Telko
Aspo clearly beat estimates in terms of profitability, managing to post flat EBIT despite a significant drop in revenue as Telko’s profitability proved a huge positive surprise.
- Aspo Q2 revenue amounted to EUR 115.6m vs EUR 130.5m/127.1m Evli/consensus estimates.
- Q2 EBIT was EUR 4.1m, compared to the EUR 2.1m/2.0m Evli/consensus estimates. ESL and Leipurin underperformed relative to our estimates while Telko beat our EBIT estimate significantly.
- ESL’s top line was EUR 32.9m while we expected EUR 40.1m. EBIT amounted to EUR 0.6m vs our EUR 1.6m expectation. Cargo volumes decreased to 3.0m tonnes (4.1m tonnes a year ago). Two-thirds of the volume decrease was due to steel industry and roughly one-third due to energy industry. Q3 result is expected to be weak.
- Telko posted EUR 59.5m in Q2 revenue in comparison to our EUR 63.1m estimate. EBIT was EUR 4.2m while we had expected EUR 1.1m. Exceptional circumstances enabled highly active pricing, which temporarily increased margins. Gross margin is expected to decrease in H2 relative to Q2, but overall should improve slightly for FY ’20. Temporary cost measures will have a relatively significant impact in Q3 and FY ’20 profitability should be at the level of previous year.
- Leipurin Q2 revenue amounted to EUR 23.2m vs our EUR 27.3m estimate. Meanwhile EBIT stood at EUR 0.3m in comparison to our EUR 0.6m expectation.
- Other operations cost EUR 1.0m vs our EUR 1.2m estimate.
- Aspo withdrew guidance in April and does not reinstate it for now.
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