Presentation

Midsona is a Swedish company that develops and markets strong brands within health and well-being, with products that help people live a healthier and more sustainable life, having increased understanding of the origin of the raw material and with transparency as to the content. The company has over 800 employees and is active in Sweden, Denmark, Finland, Norway, Germany, France and Spain. Midsona has a portfolio of proprietary brands and international client’s brands. The nine primary brands are URTEKRAM, KUNG MARKATTA, Earth Control, DAVERT, FRIGGS, HELIOS, Celnat, Vegetalia and Happy Bio. The products are sold in several sales channels, including FMCG, pharmacies, health stores, gyms and online. Midsona has been listed on the OMX Nasdaq Stockholm exchange since 1999.

Recent highlights
Net sales amounted to SEK 956m (903), corresponding to a 5.9% increase y/y and total sales of SEK 1,928m (1,868) for H1. EBITDA (before IAC) declined to SEK 34m (78), lowering the margin to 3.6% (8.6). The declining EBITDA was due to the gross margin decreasing to 23.6% (28.3). Sweden continues to constitute the largest market with 30% of total sales, followed by Denmark (14.5%) and Finland (10.5%).
Increased inflation led to the implementation of Midsona’s first round of price increases in all countries as of April 1. Midsona did also sign a contract manufacturing agreement with the Spanish grocery trade chain, Mercadona, for deliveries of plant-based meat alternatives. The company estimates the agreement to generate annual net sales of SEK 30-40m. Midsona did also report a termination of the distribution agreement for the Compeed, EllaOne and Norlevo brands as the new owners intend to ordinate in-house distribution.

Outlook
Following the first round of price increase, Midsona plan to implement the second round of price increases during quarter three. Factset consensus estimating sales to increase to SEK 4,000m by the end of 2022 with EBITDA SEK 273m, corresponding to a margin of 6.8%. Moreover, we expect costs to be reduced by the end of 2022 because of the soon-to-be-implemented restructuring programme that has the ambition to reduce the cost base by SEK 40m, annually.