Administer - Sarastia remains key to growth revival
Administer’s Q3 was soft, with lower net sales weighing on profitability. Cost-saving measures should support margins slightly in the short term, while the pending Sarastia acquisitions remain the key potential value driver.
Soft Q3 driven by market headwinds
Administer’s net sales in Q3 declined 3% y/y to EUR 17.0m, slightly below our EUR 17.7m estimate. The seasonal slowdown was compounded by the weak market environment, leading to lower net sales across business areas. The absolute decline was most notable in Econia due to continued softness in staffing services, and in Silta, where customer attrition and reduced expert rental activity weighed on revenue. EBITDA decreased to EUR 0.7m (Q3’24: EUR 1.0m), primarily reflecting lower-than-expected volumes. Cost-saving measures had limited effect in the quarter but are expected to support margins from Q4 through measures to optimize workforce across the Group and reduce fixed costs. Management’s tone on the market was cautiously optimistic, though recovery is expected to materialize with a lag.
Estimates lowered pending Sarastia completion
Administer maintained its 2025 guidance, expecting net sales of EUR 72–78m and an EBITDA margin of 7–10%. We have lowered our estimates and now forecast 2025E net sales of EUR 73.7m (prev. EUR 75.0m) and EBITDA of EUR 5.4m, implying a 7.3% margin (prev. 8.4%), reflecting the Q3 miss and a more cautious Q4 outlook. Management has indicated that the company's outlook will be updated if the Sarastia acquisitions are completed, at which point we will also revisit our estimates. The company also withdrew its 2026 financial targets ahead of the report, which is understandable given that the pending acquisitions would materially expand the company's scale and reshape its earnings profile, increasing net sales by ~80% on a pro forma basis. We continue to view the acquisitions as a significant potential value driver, although key uncertainties remain related to approval timing, integration execution, and revenue retention.
ACCUMULATE (prev. BUY) with a TP of EUR 2.7 (EUR 2.9)
Following our estimate revisions, we lower our TP to EUR 2.7 (prev. EUR 2.9) and downgrade to ACCUMULATE (prev. BUY). Administer now trades at ~15–12x adj. P/E on our 2025–26E estimates, elevated for 2025E but broadly neutral for 2026E vs. historical levels. The pending Sarastia acquisitions offer significant upside potential from 2026 onwards. We will revisit our estimates should the acquisitions be completed.