Penneo: Pos. '23 ARR guid. surprise; worrying cash flow - ABG

Prev. announced Q4 ARR in line; key focus is on '23 guidance
'23 guidance of 22-34% y-o-y ARR growth but high cash burn
Cons. ARR estimates likely up; profitability estimates down


Reaching '22 guidance

Penneo reported Q4'22 ARR of DKK 71.0m (0% vs. ABGSCe at DKK 71.0m), in line with preliminary ARR released in January. Churn was 4.0% y-o-y, uplift was 16.4%, and new ARR was 15.5%. Revenues for the quarter came in at DKK 25.4m (-11% vs. ABGSCe at DKK 28.6m), while adj. EBITDA was positive at DKK 3.3m (+9% vs. ABGSCe at DKK 3.0m), meaning that FY'22 adj. EBITDA landed within guidance of negative DKK 10m-12m. However, the higher revenue and better profitability was, as previously announced, primarily driven by one-offs from customers using Penneo's services beyond their initial agreements (i.e. no effect on ARR), lower provisions, and fewer hirings.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/penneo/Equity-research/2023/2/penneo----pos.-23-arr-guid.-surprise-worrying-cash-flow/