Topic: MAX released mixed Q1 results with muted sales and slight pressure on margins in line with expectations. However, order intake moderately improved qoq from a low level in the last three quarters supported by continuous follow-up orders from ELWEMA.

Q1 group sales declined slightly by 6.1% yoy to € 91m (eNuW: € 92m) reflecting the low order backlog compared to last year. Q1 EBITDA fell by 18% yoy to € 7.9m (eNuW: € 7.6m) due to the lower top-line, wage inflation and a product mix shift within bdtronic. Hence, the margin declined by 1.2pp yoy to 8.8%.

After three weaker quarters, order intake in Q1 showed first signs of a recovery. Q1 group order intake increased 26% qoq to € 90m but decreased 21% yoy compared to the exceptionally strong Q1 FY23. Order intake in the second half of FY23 suffered from investment restraints reflecting a challenging macroeconomic environment, restrictive financing conditions and persistently high price levels. The ongoing weakness of the global economy was in particular delt in the German mechanical and plant engineering sector. We expect the situation to improve modestly in the second half of FY24e, which should translate to increasing revenue in FY25e.

bdtronic continued its growth story and increased sales by 50% yoy to € 29.6m supported by a high order backlog and strong service business. However, EBITDA stayed unchanged yoy at € 3.3m along with a margin decrease of 5.6pp to 11.1%. This was largely influenced by a product mix shift to the lower margin impregnation business as well as wage inflation and an increase in personnel.

Vecoplan’s revenues came in at € 38.7m, a 16.2% decrease yoy. EBITDA fell by 27% to € 4.1m with a slight margin reduction of 1.6pp to 10.5% due to investment reluctance in the recycling/waste division and positive one-offs from the reversal of provisions in the previous year. We expect Vecoplan to stabilize on a plateau this year with a flat development in sales and a slight decrease in EBITDA.    

MAX confirmed its FY24e guidance of € 390-450m sales (eNuW: € 411m) and € 31-38m EBITDA (eNuW: € 33m). This appears sensible in our view as it implies a 5.7% top-line increase and a flat development in EBITDA at midpoint.

We reiterate BUY with an unchanged PT of € 8.20, based on DCF.