Topic: MAX will release its Q3 numbers on November 8^th. We expect sales and margins to remain muted. Further, on Tuesday evening, the company cut its FY24e guidance.

Investment reluctance among customers puts pressure on MAX: due to the current challenging macro, restrictive financing conditions and persistently high price levels, customers hesitate to place orders. Order intake in H1’24e fell by 14% to € 167m and backlog by 11% to € 184m. bdtronic is particularly impacted as the demand for EVs slowed down in the recent quarters. Consequently, we expect Q3 sales to decrease 9.9% yoy to € 90m. EBITDA should come in at € 7.1m (eNuW), with a 7.9% margin.   

Bdtronic impacted from cyclical demand: bdtronic has significantly expanded its capacity in FY23 due to an extraordinarily strong demand for its impregnation and dispensing machines and occupied c. 120 external services on the peak to handle the rapidly increased order intake. However, as the demand for electric vehicles in the US and Europe calmed down in H1’24, OEMs hesitate to expand their EV capacities. Therefore, bdtronic’s cyclical order intake decreased sharply by 52% yoy to € 32m (H1’24 backlog € 34m, -56% yoy). While bdtronic had to increase its capacity in FY23, they are now suffering from overcapacity and external personnel can be reduced only slowly and successively because of their idiosyncratic know-how within specific projects. We expect the situation to remain challenging throughout H2’24e and expect sales of € 17m and € 0.6m EBITDA in Q3 for bdtronic.

Elwema shows resilience: in contrast to bdtronic, Elwema’s order intake showed a very positive development and rose by 32% to € 40m in H1’24 thanks to a solid demand for combustion engines in the US. Thanks to a steady stream of follow-up orders and long lead times of 12-18 months, the company secured already enough projects for FY25e.

FY24e guidance revised: MAX revised its forecast for the current fiscal year due to a decline in order intake. Sales are now expected to come in at € 350-380m (previously: € 390-450m; eNuW old: € 378m) with an EBITDA in the range of € 27-31m (previously: € 31-38m; eNuW old: € 31m). Despite the challenging macroeconomic environment, the new guidance looks plausible in our view (eNuW sales € 366m, EBITDA € 29m). Nevertheless, as mid-term prospects remain intact, we reiterate BUY with a new PT of € 7.00 (old: € 7.50), based on DCF.