Sales was slightly lower than our forecast of SEK196m and amounted to SEK192m (161), following a somewhat lower number of employees than expected. EBIT was SEK19.4 (12.1), beating our forecast of SEK14.3. Following CombinedX’s soft guidance for Q2 in the Q1 report, we expected a rather soft Q2. Achieving a 10.1% EBIT margin in this Q2 with only 59 working days is strong, and the absolute EBIT beat our forecast by 36%. 6.6% organic sales growth and 10.1% EBIT margin stand out as strong relative to peers in the current market conditions. Both sales-cogs and especially the contribution per employee and working day, beat our forecasts, suggesting solid utilization rates during the quarter.

While management sees lower demand from some sectors, including consumer discretionary, housing, construction, and the public sector, CombinedX has managed to compensate by increasing sales from stronger sectors such as industrial, food & beverage, and security. Also, management believes CombinedX's focus on specialist teams rather than general consulting is advantageous, especially in challenging economic conditions. Although CombinedX has become more selective when recruiting, we expect low positive organic growth in H2 2023.

We leave our Base Case at SEK60 (60), constituting a significant upside relative to the current share price, despite increasing our EBIT forecasts for 2023 and 2024 by 1-6%. While CombinedX had a rough start as a listed company, we believe it is time to reevaluate the company that outperformed most peers during Q2.