* Customer caution weighing on estimates * We lower '25e-'27e sales by 11-4% and adj. EBIT by EUR 12m * Large P&M deliveries delayed to '26e ('25e previously) Q3 a slow quarter, in line with expectations Cavotec reported sales in line with estimates of EUR 36m (-19% y-o-y), but order intake of EUR 36m was 18% lower than our estimate. The lower volumes in the quarter were mainly due to customer caution and the long delivery times for P&M orders. Some of the large orders placed in Q4'24 in P&M (~EUR 44m in order intake) that were due to be delivered in Q3/Q4'25 have experienced delays, impacting the quarter. The company expects the majority of these deliveries to start next year. Due to the lower volumes, and partly due to the ramp-up preparations for the upcoming large deliveries, costs were higher in the quarter and adj. EBIT was a negative EUR 0.2m (vs. ABGSCe -0.7m and EUR 3m LY). However, it was positive to see improving margins in the Industry segment (EBITDA margin of 16.3% vs. 8% LY) due to the company's ongoing change programs in the segment. We expect Industry's profitability to improve to an EBITDA margin of 12% for '25e (vs. 8.3% in '24). Estimate changes and outlook We lower '25e sales by 11% and '25e EBIT adj. by EUR 7m after the report. We have pushed the majority of the orders that were expected to be delivered in Q4'25e into '26e. In addition, we expect the uncertainty among customers to weigh on demand and orders into '26e, leading us to also lower our '26e-'27e sales by 6-4%. We cut '26e EBIT by EUR 3.3m and '27e EBIT by EUR 1.7m. Near-term focus: volume growth We continue to find the longer-term potential in shore power and industrial electrification appealing, supported by regulatory tailwinds and structural megatrends. That said, for Cavotec to reach its financial targets, we believe it is crucial for the company to demonstrate improved volume growth. The share is trading at 17x-11x EV/EBIT in '26e-'27e vs. peers at 12x.
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