Duell - Navigating market turns
Q4 results were broadly in line with expectations, though regional performance diverged from our forecast. Revised financing provides operational flexibility, but cautious guidance and challenges in France weigh on the outlook.
Q4 broadly in line with estimates, but regional mix differed
Duell’s Q4 results were broadly in line with expectations, with net sales and adj. EBITA close to our estimates. The regional mix diverged slightly, as Nordic sales exceeded expectations due to better weather and resilience in some markets. Central Europe fell short, with sales declining y/y as changes in the French brand portfolio negatively affected volumes and profitability. Overall profitability was soft as expected, although gross margin improved after a weak Q3. The company has launched a performance improvement programme targeting profitability, net working capital efficiency and operating cash flow, with positive impacts expected from FY26 onwards. Duell did not meet its covenant requirements by the end of the period, but a waiver was granted and more suitable loan terms were agreed in October. We see this as a key positive, as the revised financing terms give the company flexibility to focus on operations.
Guidance on the cautious side
Duell provided what we view as a slightly cautious FY26 guidance expecting organic net sales and adj. EBITA to remain at FY25 levels (EUR 126.6m and EUR 4.9m), slightly below our estimate. The company expects the market environment to remain subdued, although opportunities persist and some markets continue to perform well. Dealer pre-orders are likely subdued for H1’26 due to leftover inventory from the slower winter and summer season in FY25. We also expect the brand portfolio transition in France to continue weighing on volumes and profitability in the short term. In FY25, these challenges reduced net sales by approx. EUR 4m and adj. EBITA by EUR 2.3m. The impact should moderate, and the performance improvement programme is expected to support margins. We now forecast FY26 net sales of EUR 127.5m and adj. EBITA of EUR 5.1m.
ACCUMULATE with a TP of EUR 3.8 (prev. EUR 4.8)
Based on our FY26 estimates, Duell is trading at EV/EBITDA of 6x and P/E of 7x. Despite modest estimate reductions and slightly softer guidance, the valuation appears undemanding, particularly with financing clarified. Given continued operational headwinds and limited near-term growth visibility, we maintain a cautious stance. We reiterate ACCUMULATE but lower our target price to EUR 3.8 (prev. EUR 4.8).