OrderYOYO: Another solid report and guidance upgrade - ABG

- Q2: 23% y-o-y ARR growth and 16% adj. EBITDA margin
- FY'24 guidance raised for the third time YTD
- Cons to lift '24 adj. EBITDA by 4-8%

Q2 numbers vs. ABGSCe
OrderYOYO's Q2 trading update was generally strong. Although GMV of DKK 2,912m came in 2% below our estimate, ARR of DKK 302m came in 1% above ABGSCe of DKK 298m. This equates to 23% y-o-y ARR growth vs. our 21% estimate. The company has not provided a breakdown on churn, uplift, and ARR new sales. Q2 net revenues of DKK 75m came in 1% above our estimate and correspond to 22% y-o-y growth. Turning to profitability, adj. EBITDA for the quarter of DKK 12.0m and cash EBITDA of DKK 5.5m came in substantially higher (+10% and +64% above our estimates, respectively), albeit on relatively low numbers.

FY'24 guidance and outlook
The trading update did not provide any concrete outlook comments, but included the third upgrade of the FY'24 guidance YTD. OrderYOYO now expects FY'24 net revenues of DKK 290m-300m (vs. unrevised ABGSCe of DKK 308m), adj. EBITDA of DKK 45m-50m (vs. ABGSCe of DKK 52m) and cash EBITDA of DKK 17m-22m (vs. ABGSCe of DKK 23m). The GMV and ARR guidance ranges were reiterated, and our unrevised estimates remain above on both (see table below). We get no indications that OrderYOYO expects the market to change materially during the remainder of '24e, so we deem that the raised revenue guidance is primarily driven by the stronger-than-expected H1. We also highlight that H2 is typically stronger than H1 in terms of revenues, meaning that H2 revenues will likely be higher than the DKK 148m recognised in H1. This also suggests that the low end of the raised net revenue guidance of DKK 290m looks conservative. The upgraded adj. EBITDA and cash EBITDA guidance is driven by both the higher top-line, but likely also by fewer hirings than expected (judging by the trends we see in OrderYOYO's headcount registered on LinkedIn) and lower R&D capitalisation. The H1/H2 dynamics described above also goes for adj. EBITDA and cash EBITDA (i.e. better profitability in H2 vs. H1) meaning that adj. EBITDA in H2 will likely be higher than the DKK 22.8m in H1.

Consensus estimate revisions
We expect consensus to make limited ARR revisions, but to raise '24e adj. EBITDA by 4-8% despite being above the upgraded guidance range already (OrderYOYO tends to upgrade its guidance frequently in H2 too). No conference call will be held today. The H1'24 report is due 22 August.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/orderyoyo/Equity-research/2024/7/orderyoyo---another-solid-report-and-guidance-upgrade/