Temporary setback in Q1

Larger than expected impact from AOP in Q1 putting temporary pressure on growth and margins. Growth case intact, BUY and TP of SEK 34 unchanged.

Vimian (Buy, TP: SEK40.00) - Soft start, but successful issue

Q1 sales and earnings disappointed, largely explained by Medtech (negative annual ordering programme (AOP) effects) and one-off costs. With the oversubscribed SEK1.63bn rights issue completed, Vimian has financing to execute on M&A opportunities near-term. We reinstate a recommendation with a BUY and SEK40 target price.

Miss on earnings due to MedTech

Slow start in Q1e

Vimian (No_rec, TP: SEK) - Updated targets and capital raise

This morning, Vimian updated its long-term financial targets and announced a rights issue. The new financial targets include adj. EBITA of >EUR300m by 2030 and net debt/LTM adj. EBITDA of below 3x. The company also announced a rights issue of cSEK1.6bn intended to strengthen the balance sheet and allow for further M&A activity. Given DNB Markets’ role in the rights issue, we have withdrawn our recommendation and target price.

Vimian (Buy, TP: SEK41.00) - Focus on cash flow going forward

Q4 earnings were better than expected but this was mostly due to the capitalisation of development costs, making this a ‘low-quality’ earnings beat. The new CEO (from Danaher Corp.) seems focused on improving cash flow, which has been a weak point for Vimian in the past. Also, we got the impression that M&A might be back on the agenda. We reiterate our BUY and have raised our target price to SEK41 (38).

Vimian (Buy, TP: SEK38.00) - Healthy underlying growth

We believe underlying market growth for the companion-animal space grew by c6% YOY in Q4, and for Vimian we expect organic growth of c10% YOY. We understand it plans to narrow the annual ordering programme (AOP) in Q1 to smooth the sales trend in the medical technology space. We expect no news on the litigation in the US with the sellers of VOI. We reiterate our BUY, but have cut our target price to SEK38 (40) on forecast changes.

Vimian (Buy, TP: SEK40.00) - Investing for the future

Q3 earnings were in line with our estimates, with sales c2% above our forecast and adj. EBITA c1% above. However, adj. EBITA fell c3% shy of consensus. Vimian indicated that margins in diagnostics would remain at the current level for some quarters due to investments in new products. We believe the investments will pay off handsomely in the coming years and should strengthen growth and margins in the division and ultimately the group. For the coming quarters, Vimian’s focus will be on organic gr...

Vimian (Buy, TP: SEK40.00) - Below consensus for Q3e

We are below consensus on Q3e sales and earnings, and see the pull-forward effect from the annual ordering programme (AOP) in Q1 having a larger negative effect on growth in Movora in Q3 than in Q2, primarily due to weaker growth in Asia and Europe. However, we expect growth in the Nextmune operation to remain healthy, despite some pressure on margins from changes in the sales mix. We reiterate our BUY but have lowered our target price to SEK40 (43).

Northern Lights

Vimian (Buy, TP: SEK43.00) - Strong organic growth in Q2

Q2 organic growth and adj. EBITA beat expectations, while the margin was in line with consensus but well above our estimate. Management guided for healthy organic growth in H2, albeit less than Q2’s 14% YOY, but an improving margin sequentially and YOY. We reiterate our BUY and SEK43 target price.

Vimian (Buy, TP: SEK43.00) - Change of CEO brings uncertainty

We are c6% below consensus on Q2e adj. EBITA but c2% above for the full year (the Q2 results are due at 07:45 CET on 17 August). News the CEO is stepping down has brought uncertainty, we believe. In addition, we would like an update on the indemnification regarding the US IP settlement this spring. However, we reiterate our BUY and SEK43 target price.

Vimian (Buy, TP: SEK43.00) - Organic growth improving

Vimian reported Q1 organic growth of c13% YOY for the group and 16% for the companion animal operations. The adj. EBITA margin was slightly higher than we expected. However, cash flow was weak, and the cash-flow risk increased over the weekend in our view, with three of the sellers of VOI taking legal action related to the indemnification for the USD70m settlement with DePuy. We reiterate our BUY and SEK43 target price.

Northern Lights

Vimian (Buy, TP: SEK43.00) - IP settlement a clear positive

We expect a strong Q1, among other things driven by the annual ordering programme in Movora (its medical technology operations) and more stable demand in southern Europe (results due at 07:45 CET on 4 May). However, we believe the key positive since the Q4 report is settlement of the VOI IP infringement case with DuPuy (Vimian will pay cUSD70m, and is indemnified by the sellers of VOI for the full amount of the settlement). We reiterate our BUY and SEK43 target price.

Northern Lights

Vimian (Buy, TP: SEK43.00) - Q4 in line with expectations

Q4 earnings were broadly in line with our estimate, while sales and adj. EBITA were c4% and c2% above. Organic growth stayed low at c3.5% YOY but Vimian’s comments about high-single digit growth at the start of 2023, in line with its full-year target, were promising. It said its long-term aim of a c35% adj. EBITA margin would be hard to reach by 2025 as previously guided due to product mix changes. We reiterate our BUY and SEK43 target price.

Northern Lights

Vimian (Buy, TP: SEK43.00) - Facing another challenging quarter

We believe several of the challenges Vimian faced in earlier in 2022 lingered into Q4. As a result, we have cut our sales and margin estimates ahead of the report (due at 07:45 CET on 8 March) and lowered our target price to SEK43 (50). However, we reiterate our BUY.

Vimian Group - No cash cow at this farm yet

Adj. EBITA 4% better, but cash generation looks bleak We leave estimates relatively unchanged We remain BUYers as we near improvement in ‘23e