Märkte & Kurse

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Original-Research: Scandinavian Astor Group AB - from NuWays AG

17.06.2025 / 09:00 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group.
The issuer is solely responsible for the content of this research. The
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.

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Classification of NuWays AG to Scandinavian Astor Group AB

     Company Name:                Scandinavian Astor Group AB
     ISIN:                        SE0019175274

     Reason for the research:     Update
     Recommendation:              Buy
     from:                        17.06.2025
     Target price:                54.00
     Target price on sight of:    12 months
     Last rating change:
     Analyst:                     Henry Wendisch

Another deal unlocks opportunities in the Baltics, PT up.

Yesterday, Astor announced the acquisition of AMMUNITY and with that the
market entry into the Baltics.

Astor has yet again pulled off a strong M&A deal by acquiring AMMUNITY for
only 4.4x EV/EBITDA. The company is based in Riga and is Latvia's only
manufacturer of military small arms ammunition and a leading provider of
fine caliber ammunition in the Baltics (all NATO standard) for Armed
Forces/procurement
agencies in the Baltics. With FY'24 sales of SEK 103m (+80% yoy) and a 21%
EBITDA margin, the company shows a strong growth and profitability profile,
underpinned by a standing contract with the Latvian government worth SEK
400m coupled with an option for further SEK 400m. Moreover, it has
additional
request for ammunition worth SEK 360m from a third customer, thus leading to
a total soft order backlog of SEK 1.16bn (i.e. >10x FY'24 sales), creating a
strong visibility on demand, in our view.

Perfect strategic fit and door opener into the Baltics. Next to strong
fundamentals, this acquisition looks set to perfectly fit into Astor's
product portfolio. By now serving ammunition (next to drone and radar
jammers, composite parts and various other high-tech equipment), it
diversifies the revenue mix and gives it a slightly more recurring touch.
More importantly, Astor now has a foot in the door at the Baltic Armed
Forces/procurement agencies and thus enters the Baltic defence market by
potentially up-selling all of Astor's product portfolio. Also, the other
way, Astor can now also offer the Scandinavian Armed Forces/procurement
agencies with supply of ammunition from the close neighbor Latvia, which
currently mostly rely on the Norwegian company 'Nammo' for their ammunition
supply.

Astor to fund growth investments. The strong demand for ammunition directly
creates the need to expand, whose expenses are likely to be financed by the
parent company Astor, given that further debt intak at AMMUNITY (200% net
debt/equity, based on acquisition value of equity) should not be healthy. In
our view, this should also explain the comparably low acquisition multiple,
as it does not contain the upcoming growth investments.

Against this backdrop, we confirm our BUY recommendation. We now incorporate
the recent M&A (100% of Carbonia; 39% of NSG/Cesium, recorded at equity and
now 100% of AMMUNITY) in our estimates, as we assume the closings to go
through as announced. Therefore, we raise our estimates accordingly and
arrive at a new PT of SEK 54 (old: SEK 40), based on DCF.

You can download the research here: http://www.more-ir.de/d/32862.pdf
For additional information visit our website:
https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research

Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
++++++++++
Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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2156164 17.06.2025 CET/CEST

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