The H2 sales came in at SEK26.3m (SEK21.8m), where SEK13.8m were organic, and SEK12.5m came from acquired sales. The sales aligned with our sales estimate of SEK26.5m, and the sales growth resulted mainly from GARD orders and a strong Q4 by SenzaGen’s subsidiary VitroScreen. Operating expenses amounted to SEK-28.6m (SEK-26.1m), where we estimated a total OPEX of SEK-29.9m (including D&A). OPEX consisted mainly of selling expenses and administrative costs but also acquisition-related costs of SEK3.8m. EBIT came in at SEK-10.0m (SEK-11.4m), slightly better than our estimate of SEK-12.1m. The report aligned with our expectations, and we argue the results were solid.

The report aligned with our expectations from a sales perspective. However, during 2023, we lowered our sales estimate several times and left our long-term estimates unchanged. We believe our future sales estimates could be a bit too optimistic. We estimate sales will rise significantly during 2024e; however, we decrease our full-year estimate from SEK86.0m to SEK73.1m. From 2025e-2030e, we lower our sales estimates between 8-15%. We argue our updated sales forecast is more realistic and still shows that investors should have high expectations of SenzaGen.

Moreover, SenzaGen has shown during 2023 that it can increase sales and, at the same time, keep costs at reasonable levels. In the report and conference call, we learned that OPEX is not expected to rise significantly during 2024. We have chosen to decrease our OPEX estimates for 2024e-2026e, mainly expecting lower R&D and administrative expenses than previously anticipated.

Our estimate changes do not significantly impact our fair value range. Our base case remains at SEK20, followed by a slightly decreased bear and bull case of SEK6.5 (7) and SEK29 (31), respectively. The SenzaGen share is currently traded close to our bear case. We argue that the past year’s negative share price development does not reflect the company’s performance and that current share price levels should be considered attractive.