Efecte Plc's business review on 1-9/2021 – SaaS +23%, EBITDA margin 7%
27 Octubre 2021 - 12:30AM
Efecte Plc's business review on 1-9/2021 – SaaS +23%, EBITDA margin
7%
EFECTE PLC -- BUSINESS REVIEW
-- 27 OCTOBER 2021 at 8.30
Efecte Plc's business review on 1-9/2021
– SaaS +23%, EBITDA margin 7%
7-9/2021:
- SaaS grew by 21% and international SaaS by 26%
- EBITDA was 0.4 million euro (0.3) and EBIT 0.3 million euro
(0.2)
- EBITDA margin was 9% (9%)
- Services grew by 28%, driven by strong demand and a comparison
period impacted by the pandemic
- Strategy execution proceeded, including new product and partner
announcements
1-9/2021:
- SaaS grew by 23% and international SaaS by 36%
- EBITDA was 0.8 million euro (0.0) and operating profit 0.5
million euro (-0.4)
- EBITDA margin was 7% (0%)
Guidance for 2021
(unchanged):SaaS net sales is expected to grow 21-24% and
EBITDA margin to be 1-6%.
Group key figures
1000 EUR |
7-9/2021 |
7-9/2020 |
1-9/2021 |
1-9/2020 |
2020 |
|
|
|
|
|
|
|
|
Net sales |
4 225 |
3 453 |
12 912 |
10 846 |
14 888 |
|
EBITDA |
399 |
321 |
840 |
-45 |
126 |
|
EBIT |
264 |
209 |
470 |
-373 |
-332 |
|
|
|
|
|
|
|
|
SaaS MRR |
929 |
768 |
929 |
768 |
808 |
|
|
|
|
|
|
|
|
CEO Niilo Fredrikson:
During Q3, we delivered strong profitability and
steady growth in line with our guidance. However, what really stood
out to me was our ability to attract world-class people. In a
competitive recruiting environment, we increased our full-time
equivalent headcount from 109 in June to 118 in September. We
filled several critical roles with quality candidates that were
able to hit the ground running. The strength of our culture and our
team decide our success in the long-term, and that’s why developing
them and attracting the right talent are amongst our top
priorities.
Improving financial
equation
SaaS growth of 21% was in line with our
expectations. Faster than usual 28% services growth helped total
net sales to grow 22%. This resulted in another quarter of improved
profitability, despite increasing growth investments to support our
long-term strategy.
International SaaS growth at 26 % was slower
than during the first half. However, new customer acquisition
continued at a healthy pace in DACH, and we anticipate
international SaaS growth to accelerate again towards the end of
the year. During the review period, we also won a significant
public tender by the Social Insurance Institution of Finland
(Kela). The impact on SaaS MRR is expected to be visible starting
Q4 2022. The case served as another proof point of our
competitiveness and ability to continue growth also in Finland.
Strategy execution in focus
Our annual customer event Digitalize and
Automate 2021 served again as a platform for advancing our
strategy. The growth in attendees, combined with strong ratings for
both days, showed how well our messages resonate across Europe.
Almost 2000 people from over 20 countries signed up this year to
hear us raise awareness about Efecte and the importance of creating
European digital platforms. Key announcements at the event included
a new partnership with BT Bilgi in Turkey and several product news.
The showcased innovation pipeline included all-new Efecte
Self-Service, extended Microsoft Teams integration, and a new REST
API to make it easier to connect Efecte with other systems. Later
in the quarter, we also announced Softcat as a new channel partner
in the UK.
Capitalizing on the market
opportunity
Helping customers digitalize and automate their
work with a SaaS-based service management platform has proven to be
a great business to be in. The market is growing fast, and there is
no end in sight. We mentioned in the half-year report that we
intend to increase recruiting and other growth investments during
the second half. That is what we have done, and we will continue
down that path.
Our approach is simple: prioritize long-term
investments over short-term profitability to maximally capitalize
on the market opportunity at hand. Every day, customers across
Europe make buying decisions regarding service management
solutions, and Efecte is currently present only in a small subset
of these discussions. To expand our reach, we will continue
investments in our sales teams and partner channel in existing
markets. Exploring new direct and partner-based markets across the
EMEA region and evaluating opportunities for M&A are also part
of the plan, as we continue to grow as the European Alternative to
the global goliaths in our space.
Other developments
Our cash position developed favorably, with cash
and liquid assets of 6.4 million euro (3.8) and no interest-bearing
financial debt at the end of the review period. On a rolling
12-month basis, recurring gross margin was 80%, gross churn 5.0%,
net retention rate 113% and LTV/CAC ratio 5.1. Total recurring
revenue (SaaS and maintenance) amounted to 71% of net sales
(73%).
The number of full-time equivalent employees at
the end of the review period was 118 (102). Of these, 99 (85) were
in Finland, 7 (6) in Sweden and 12 (11) in Germany. The average
number of full-time equivalent employees during Q3 was 114 (100)
and during 1-9/2021 it was 111 (103). Our central team in Finland
acts globally supporting customers, partners and sales in all
markets and includes the headcount responsible for our new markets
operation.
Long-term financial targets
Efecte aims for over 20% annual organic growth
of SaaS net sales on average in 2020 - 2023. Substantial
investments in international growth and product development will
decrease operating profit in the next few years, but the company
aims for a double-digit operating profit percentage by the end of
the strategy period.
Guidance for the year 2021
SaaS net sales is expected to grow 21-24% and EBITDA margin to
be 1-6%.
Next earnings release
Efecte will publish complete financial statements on 2021 on 11
February 2022.
Additional information: CFO Taru Mäkinen, +358 40 507 1085
CEO Niilo Fredrikson, +358 50 356 7177
Certified adviser: Evli Pankki Oyj, tel. +358 40 579
6210
This release is unaudited. The amounts in this
report have been rounded from exact numbers.
An online briefing for analysts, investors and media will be
arranged on Wednesday 27th October 2021 at 15:00 Finnish time. All
participants can register to the webcast online at
https://efecte.videosync.fi/business-review-1-9-2021. The webcast
will be held in English and questions can be presented in written
form in the webcast portal. A recording of the webcast and
presentation materials will be made available afterwards on the
company’s investor pages at investors.efecte.com.
Efecte Plc
Efecte helps service organizations digitalize
and automate their work. Customers across Europe leverage our cloud
service to operate with greater agility, to improve the experience
of end-users, and to save costs. The use cases for our solutions
range from IT service management and ticketing to improving
employee experiences, business workflows, and customer service. We
are the European Alternative to global players in our space. Our
headquarters is located in Finland and we have regional hubs in
Germany and Sweden. Efecte is listed on the Nasdaq First North
Growth Market Finland marketplace.
www.efecte.com
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