FlexQube reported Q4 2023 sales of SEK31.5m, down 35% y-o-y, which was completely in line with our estimates. The order intake amounted to SEK31.3m, growing 7% sequentially. We had hoped for a higher order intake but are pleased to see that it is moving in the right direction. The gross margin came in at an ATH of 63%, which we believe is primarily due to a favourable product mix. OPEX came in at SEK-25.7m relative to our estimate of SEK-29.0m – which we were very pleased with. This seems to be due to the cost savings program progressing ahead of plan. All in all, Q4 2023 EBITDA amounted to SEK-5.2m (SEK-2.2m), clearly beating our estimate of SEK-17.1m.

FlexQube received its first commercial order for its AMR Navigator in December 2023. We understand deliveries are underway, and the installation will be fully implemented in Q2 2024. Hopefully, this can be the start of many additional orders from this particular customer and new customers, which will drive sales and profitability. We understand that the market conditions for FlexQube’s offering are still cautious, especially in Europe, but North America and Mexico are more prosperous. FlexQube targets 2024 sales above SEK200m (and positive cash flow in Q4), representing >74% y-o-y growth.

We consider the report solid and ahead of our estimates on a P&L level, but we had expected a higher order intake. Given that more than 50% of Q1 2023 has progressed, and no orders have been press released, we believe that H1 2023 will show modest sales growth, whereas our previous estimates reflected a steeper sales curve. As a result, we push our near- and long-term sales estimates, which negatively affects our valuation. However, we increase our margin assumptions following the high gross margin and lower OPEX, which has a muting effect on our negative estimate revisions. All in all, our updated fair value range sits at SEK7(15)-SEK50(60) with a base case of SEK25(32) per share.