Swedish food retail market: +5% in October

XXL ASA (No_rec, TP: NOK) - Recommendation and target price withdrawn

XXL reported weak Q3 results and announced a contemplated NOK600m fully underwritten rights issue. Given DNB Markets’ role in the contemplated rights issue, we have withdrawn our recommendation and target price.

Soft discount at a discount

Soft Q3 results

City Gross acquisition approved (corrected)

More growth, fewer hiccups

Swedish food prices +1.7% y-o-y in September

Axfood (Buy, TP: SEK320.00) - Upcoming efficiency gains in focus

We are neutral ahead of the Q3 report, as we forecast sales growth momentum across all segments to be offset by still-negative effects near-term from the Bålsta ramp-up. We expect focus to be on Dagab efficiency gains in the coming quarters and into 2025, and we like the industry’s continued volume growth following a weak 2023. We reiterate our BUY and SEK320 target price.

Swedish food retail market: +4.4% in August

Swedish food retail market: +4.0% in July

Axfood AB: 1 director

A director at Axfood AB maiden bought 3,000 shares at 259.866SEK and the significance rating of the trade was 71/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clea...

XXL ASA (Hold, TP: NOK0.75) - Q2 disappoints

While there are early signs of a market recovery, this was not apparent in XXL’s Q2 results, which were significantly below expectations, driven by lower sales, reduced gross margins, and higher costs. XXL is making progress on its strategic initiatives, but it needs to return to sales growth to see the full impact. We reiterate our HOLD and NOK0.75 target price.

Axfood (Buy, TP: SEK320.00) - Looking beyond 2024 hiccups

Q2 was hurt by one-off costs in Dagab, and the Bålsta ramp-up is now expected to take longer than Axfood initially planned. That said, its annual efficiency target is unchanged, and it again outperformed the market despite very tough comparables. We reiterate our BUY, but have cut our target price to SEK320 (330) after lowering our estimates.

Weakness offers good entry point

Axfood continues to outpace the market but higher costs in Dagab and some one-offs weighed on Q2. Current weakness offers a good entry point, BUY

XXL ASA (Hold, TP: NOK0.75) - Weak Q2

We consider this a weak report for XXL, with figures below expectations and a reiteration of the improvement programme. We expect 10–15% negative revisions to consensus 2024e EBITDA and believe a negative share price reaction warranted.

Axfood (Buy, TP: SEK330.00) - Trouble for Dagab hit results

We consider this a weak report, with adj. EBIT c13% below consensus. The miss was driven by a negative development in Dagab, hit by restructuring costs and disturbances in its logistics operations and costs related to the City Gross acquisition. We expect consensus 2024e adj. EBIT to come down c3–5% on the results and believe a negative share price reaction is warranted.

Soft Q2 results mainly due to one-offs

Q2 preview: solid quarter despite tough comps

Positive volume/mix in Q2'24e. Q2'24e preview: adj. EBIT of SEK 963m (+2% y-o-y). Margins set to expand: BUY and TP of SEK 320 reiterated.

Swedish food retail market: +5.1% May

XXL ASA (Hold, TP: NOK0.75) - Doubling down on private label

We are positive ahead of the Q2 results (due at 07:00 CET on 12 July), expecting EBITDA 23% above consensus. While we see early signs of increased retail spending, we believe XXL needs to prove it can deliver on its strategic initiatives to fully benefit from a potential market recovery. We reinstate our recommendation with a HOLD and NOK0.75 target price.