| During the first half of 2025, Solid World Group experienced a phase of profound transformation, marked by steady revenues and a temporary decline in profitability due to the transition of its business model and continued investments in the biomedical and defense sectors. Production value amounted to € 31.69 million, slightly down from € 36.94 million in 1H24A, which, however, included a non-recurring item of € 5.30 million related to the valorisation of the Electrospider project; net of this effect, the figure was essentially stable. EBITDA decreased to € 0.51 million (1.6%) from € 6.40 million (15.6%, including the aforementioned non-recurring item) in the previous year. Consolidated Net Income closed with a loss of € -1.87 million, compared with a profit of € 2.60 million recorded in the first half of 2024. Net Financial Position moved from € 14.59 million of debt as of 31 December 2024 to € 16.64 million of debt at the end of 1H25, reflecting the impact of industrial investments and the increase in net working capital. In light of the results published in the half-yearly report, we are updating our estimates for the three-year period 2025–2027. Specifically, we estimate that FY25E production value will grow to € 63.50 million and EBITDA will be € 2.00 million. For the following years, we expect production value to increase to € 78.90 million (CAGR FY24A-FY27E: 6.0%) in FY27E, with EBITDA of €5.15 million and a margin of 6.8%. From a financial standpoint, we estimate an NFP of € 12.26 million for FY27E, an improvement on the € 14.59 million recorded in FY24A. We have assessed the equity value of Solid World Group using the DCF method. The DCF method (which, for prudential purposes, also includes a specific risk of 2.5% in the WACC calculation) returns an equity value of € 28.98 million. The target price is therefore € 1.55 (previously € 3.00). We confirm our BUY rating and MEDIUM risk. |
