Investment management held up well in the quarter, despite continuously challenging market conditions and a seasonally weak quarter. Adjusted for FX effects and the outflow from a planned termination of a mandate in Catella UK, AUM remained roughly flat against Q4 2023 at cSEK151bn, an impressive feat at the current time. Revenue was down by c-2% y/y, whereas EBIT improved from SEK26m to SEK32m, manifesting the tight cost control of the organisation.

The weak transaction market continues to influence performance in both Corporate Finance and Principal Investments. Corporate Finance showed lower revenue than estimated, where we had wrongfully extrapolated the positive tendencies from Q4 2023. In Principal Investments, there was a positive liquidity effect from the divestment of Infrahubs Jönköping, although we continue to view the divestment of Kaktus as the main trigger for the share.

Despite the continuously challenging market environment, we view Catella as an interesting opportunity with an imminent trigger (Kaktus). We make some minor changes to our estimates, including lowering our 2024e figures for Corporate Finance and fine-tuning our Investment Management assumptions. In our calculation of “enterprise value”, where we net project-related debt against the corresponding assets, we estimate that the company is currently trading at an EV/EBIT multiple of c2.5 for 2025e. All in all, the company delivered mostly in line with our estimates. As a result of a higher value for the Principal Investment component in our SOTP, our new fair value range is SEK27-69 (previously 24-66), with a Base Case of SEK56 (53) per share.