Formpipe: Public DK setback, but more optimism for H2e - ABG

Softer Q1 than expected, but with solid progress for Private
We cut '24e-'26e EBIT by 22-6% on lower sales and higher opex
Slowdown in margin progression in '24e, before picking up in '25e


SaaS scalability shining through in Private

In 2023, we got used to Formpipe consistently reporting expanding margins, driven by its scalable business model and focus on restoring profitability. In Q1, however, margins had a temporary setback, chiefly from lower consultancy sales in Public DK. This is not the first time that sales with its largest customer, Landbrugsstyrelsen, have been lumpy on a quarterly basis, so the lower revenue (Public Delivery revenue -44% y-o-y) does not give us cause for concern, and we are more positive about H2. Although Private continued to report solid numbers, with sales +9% y-o-y coupled with a 21% EBITDA margin (vs. 11% in Q1'23, showcasing the high scalability), group sales fell 2% y-o-y (-7% vs. ABGSCe) while EBIT was down 37% y-o-y for a margin of 3.6% (vs. 5.5% in Q1'23).

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/formpipe/Equity-research/2024/4/formpipe---public-dk-setback-but-more-optimism-for-h2e/