CombinedX: Splitting Aspire

Research Update

2024-10-15

15:06

Analyst Q&A

Closed

Fredrik Nilsson answered 2 questions.

Redeye takes a positive stance towards the partial divestment of Aspire. While it puts some question marks on the 2022 acquisition of Attentec, we believe the move is financially and strategically wise.

Fredrik Nilsson

Anton Hoof

Key financials

SEKm20232024e2025e2026e2027e
Revenues766.3970.31,008.21,051.01,092.2
Revenue Growth17.6%26.6%3.9%4.2%3.9%
EBITDA117.1125.3147.2154.2159.5
EBIT80.078.597.9106.4113.9
EBIT Margin10.4%8.1%9.7%10.1%10.4%
Net Income71.061.277.284.089.9
EV/Revenue0.70.60.50.40.4
EV/EBIT6.57.45.44.43.6

Today, CombinedX announced that it divests Aspire’s Borlänge-based system development business working for Transportstyrelsen to Consid. The operation has sales of about SEK40m with limited profitability. The purchasing price is negligible due to the limited profitability, and as Aspire will lose its major contract with Transportstyrelsen to Consid in 2025. Thus, not selling would have resulted in substantial costs for CombinedX – given that it could not find new assignments for all consultants, which seems challenging in the current market environment. The remaining Aspire operations – circa SEK60m in sales and likely negative EBIT R12m – will join Ninetech.

We believe the partial divestment and splitting of Aspire is a sound move. Based on annual reports, Aspire was the only CombinedX subsidiary with negative EBIT in 2023. Also, Aspire is not as specialized in its go-to-market approach as the other subsidiaries and lacks focus on specific software suits.

Disclosures and disclaimers

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