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Original-Research: Nynomic AG - from NuWays AG

Classification of NuWays AG to Nynomic AG

Company Name: Nynomic AG
ISIN: DE000A0MSN11

Reason for the research: Update
Recommendation: Kaufen
from: 10.05.2024
Target price: EUR 52.00
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Christian Sandherr

Solid start into FY24 despite challenging end markets

Topic: Nynomic published a solid start into the year with order intake
returning to growth for the first time since Q3 2022. Similar to FY23, this
year's operational performance should again be back-end loaded.

Preliminary Q1 sales grew by 6.5% yoy to EUR 23m thanks to consolidation
effects from last year's acquisitions of NLIR and art photonics (eNuW +4.5%
yoy growth) as well as solid demand across the group's portfolio companies,
despite a weak industry momentum. At the same time, Q1 EBIT stood at EUR
1.6m, up 6.7% yoy, with a margin of roughly 7%. Mind you, the low margin
(in comparison to FY margin of >13%) is due to the seasonallity of the
business, a changing product mix and limited op. leverage.

Importantly, order intake returned to growth for the first time since Q3
2022. It grew by 24% yoy and 57% qoq to EUR 28.7m. This does not yet include
the high single-digit EURm order (eNuW: EUR 7-8m) that the company received at
the end of April (solution to further improve the efficiency and accuracy
of the customer's gas analysis); order backlog +11% qoq to EUR 59.6m. This
should provide additional visibility regarding the mentioned sequential
improvements throughout the year.

Similar to FY23, management again expects further operational improvements
in the second quarter, followed by a particularly strong second half of the
year (in FY23, H2 accounted for 55% of FY sales and 70% of FY EBIT) due to
the known lumpy nature of the business.

For FY24e, management continues to expect "at least single-digit percentage
growth" and a further EBIT margin improvement, which compares to our
estimates of 12% yoy sales growth (8% organic) and a 60bps EBIT margin
improvement based on (1) unbroken demand from semi customers, (2)
fulfilment precision farming orders, (3) TactiScan gaining traction, (4) a
structurally growing medtech market and (5) new product launches such as
LabScanner Plus.

Acquisitions could serve as additional catalyst. As per its growth
strategy, Nynomic should be looking to acquire 1-2 companies (technological
and geographical diversification) during the next six months. Thanks to its
strong balance sheet, we also regard bigger targets (~ EUR 20m sales) as
possible.

We confirm our BUY rating with an unchanged EUR 52 PT based on DCF and keep
the stock on our Alpha List.

You can download the research here:
http://www.more-ir.de/d/29653.pdf
For additional information visit our website
www.nuways-ag.com/research.

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
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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