Penneo: Guidance reiterated despite soft Q1 - ABG

23% y-o-y ARR growth in Q1, adj. EBITDA of DKK -3.7m
"One-off" headwinds in Q1 means unchanged FY'24 guidance
Expect consensus to cut '24 adj. EBITDA slightly


Q1 numbers vs. ABGSCe

Q1 ARR of DKK 91.3m came in ~2% below our DKK 92.8m estimate and corresponded to 23.0% y-o-y growth. Churn rose somewhat to 5.5% y-o-y, above our 4.5% estimate. The explanation lies in the departure of one larger client. Uplift of 12.9% was 2.6pp weaker than we had expected, with a significant portion of the deviation driven by a few temporary downgrades from larger customers. On a positive note, 15.6% y-o-y growth in ARR new sales was 1.6pp stronger than expected, driven particularly by a high intake of new customers (which is particularly impressive in light of the otherwise seasonally weak Q1). However, revenues of DKK 21.2 still came in 12% below our estimate, also driving the miss on adj. EBITDA (which came in at DKK -3.7m compared to our DKK -1.9m estimate). On a positive note, however, FCF of DKK -7.3m in Q1 was better than expected (due to better OCF), driving the cash position down to DKK 34m (vs. our estimate of DKK 30m).

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/penneo/Equity-research/2024/5/penneo---guidance-reiterated-despite-soft-q1/