Earnings call transcript: Schouw & Co. sees solid Q1 2026 amid revenue dip

Schouw & Co. delivered a solid Q1 2026 with revenue down 3% to DKK 7.7 billion but EBITDA up 5% to DKK 591 million and earnings before tax up 36%. The company kept full-year guidance unchanged at DKK 33.0-35.5 billion in revenue and DKK 2.9-3.2 billion in EBITDA, while also initiating the BioMar IPO process. Shares rose 3.96% after the report, supported by improved profitability and continued deleveraging to 1.6x EBITDA.

Analysis

The key signal here is not the headline beat, but the changing quality of earnings. Schouw is increasingly behaving like a portfolio of self-help and optionality assets: GPV is turning footprint rationalization and supply-chain discipline into margin expansion, HydraSpecma is compounding into defense/data-center adjacency, and Fibertex Nonwovens is starting to harvest prior capex. That combination should support a valuation re-rate for the holding company if investors begin to underwrite a higher-through-cycle EBITDA multiple rather than treating it as a cyclical industrial conglomerate.

The near-term catalyst is the BioMar IPO process, which creates a potential sum-of-the-parts unlock over the next few weeks, not months. Even if the listing is only partial, it should surface the embedded value of the feed business and may force the market to reassess the remaining portfolio at a lower conglomerate discount. The second-order effect is that proceeds could be recycled into higher-return bolt-ons, which would further reinforce the self-help narrative and could keep the stock supported even if end markets stay mixed.

The main risk is that the market may over-interpret one quarter of margin resilience as durable if working capital, toll milling, and raw-material pass-through lag turn more volatile. BioMar’s capacity ramp timing matters more than the quarter suggests: if the second-half improvement slips, the IPO narrative could lose momentum just as the market is deciding on pricing. The contrarian take is that the stock’s post-earnings move may still be too small relative to the latent optionality, but only if investors trust that cash conversion and margin gains are structural rather than seasonal.

Key Decisions for Investors

• Go long 0O0N on pullbacks over the next 1-3 weeks ahead of the BioMar IPO decision; thesis is sum-of-the-parts unlock with 8-12% near-term upside if the flotation proceeds, but cut if market feedback turns negative.
• Pair trade: long 0O0N / short a diversified industrial holding-company proxy for 1-3 months; Schouw has a clearer catalyst stack and better self-help torque, while the short leg should underperform if cyclicals stay range-bound.
• Add exposure to GPV-linked growth/automation beneficiaries via 0O0N rather than direct EMS peers for a 6-12 month horizon; upside comes from margin expansion and order-book quality, with risk limited to component shortages delaying the ramp.
• Take profit on a portion of the post-earnings rally if 0O0N closes above the next technical resistance before BioMar pricing is visible; the stock can give back part of the move if IPO timing is delayed or valuation expectations reset.
• For options traders, consider a medium-dated call spread on 0O0N into the IPO window; risk/reward is attractive because the main upside catalyst is discrete, while downside is cushioned by unchanged group guidance and deleveraging.