Original-Research: Nabaltec AG (von NuWays AG): BUY

Classification of NuWays AG to Nabaltec AG

Company Name:	Nabaltec AG
ISIN:	DE000A0KPPR7
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 18
Target price on sight of:	12 months
Last rating change:
Analyst:	Christian Sandherr

Q3 in line with expectations, margins remains solid

Nabaltec reported Q3 figures that were largely inline with our estimates and the company’s FY25 guidance. Overall, demand remains subdued while capacity expansions temporarily weight on FCF generation. Here are the key takeaways:

Q3 group sales declined by 2.4% yoy to € 48.6m (eNuW: € 49.3m). Functional Fillers sales of € 35.2m (-1.7% yoy) were impacted by a further deterioration of boehmite revenues, which should be down roughly 30% for FY25e (eNuW: € 8.5m vs € 12.5m in FY24; Q3 ‘25 € 2.3m). In contrast, viscosity optimized hydroxides continued to grow, surpassing boehmite for the FY in regards to sales contributions. ATH showed further slight improvements. Mind you, the company should strongly benefit from increased demand from extensive data center investments. Specialty Alumina, which is largely dependent on the refractory industry, recorded Q3 sales of € 13.4m, down 4% yoy. 9M group sales stood at € 155m, -1.9% yoy.

EBIT in the third quarter stood at € 5.1m, a 13.9% yoy decline. Yet, the margin of 10.6% was only slightly below last year’s figure of 11.3% thanks to an improving gross margin due lower energy costs, offsetting higher personell and project related expenses. 9M margin of 9% remains at the upper end of the FY25 guidance of 7-9%.

Cash at the end of Q3 was impacted by the lower operating result but also temporarily higher working capital. Capex remains high (9M: € 17.7m) as a result of the last tranche of Nabaltec’s growth initiative. Mind you, the company is expanding its production capacities for the viscosity optimized hydroxides and boehmite. While demand for the latter remains subdued, it’s important to note that the additional capacities can also be used to produce fine ATH, which should record further sustainable growing demand. Net debt at the end of Q3 was € 15m.

The FY25 guidance was confirmed and looks reachable, especially on margins. Management expects sales to decrease by up to 2% with an EBIT margin of 7-9%.

While the valuation of Nabaltec’s shares remains arguably low, the sentiment across key end markets as well as the low visibility temporarily prevent a re-rating. Nevertheless, the prospects remain bright. The company is the European market leader for environmental flame retardants, which record sustainable demand growth backed by several trends (AI being one of them). Investments from Germany’s planned € 500bn infrastructure bill should turn into notable tailwinds. While boehmite sales have been declining for several years, the product continues to have potential during the mid-term, depending on European ramp up of battery cell productions. From 2026e onwards, first positive implications as well as general demand normalizations are seen to materialize, eNuW.

BUY with an unchanged € 18 PT based on FCFY 2025e.

You can download the research here: nabaltec-ag-2025-11-24-update-en-893f1
For additional information visit our website: https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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