Q3'23 Results Preview: Seco Warwick Anticipates Revenue Decline Amidst Market Dynamics
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Q3'23 results preview
In Q3'23, we assume a 9% y/y decline in sales revenues from a record Q3'22 base. We assume 13% lower y/y revenues in the Vacuum Furnace segment (Q3'22 historically record quarter) and a 27% y/y decline in the Aluminum Process (CAB) segment (effect of weaker sales in China - slight market saturation). The Vacuum Metalurgy and Aftersales segments will deliver similar y/y turnover in Q3'23 in our opinion.
We estimate Q3'23 EBITDA at PLN 11mn, down 47% y/y, mainly due to an unusually high comparative base (Q3'22 saw high sales in the vacuum furnace and CAB segments and unusually high profitability in the vacuum segment; typically, Q3 is seasonally similar to Q2). In Q3'23, we assume a slight decline in gross profit from sales relative to the previous quarter, mainly due to weaker margins in CAB (lower revenues, especially at the company in China).
In our view, Seco Warwick will report a similar value of new orders won q/q and y/y, despite the observed strengthening of the PLN against the EUR and USD. We assume that the order backlog will remain above PLN 500mn at the end of Q3'23.
