Pricer: Insights from the CMD - ABG

Key message: Pricer sees strong growth prospects
New ‘25 sales target: SEK 4.5bn (26% ’21-‘25 CAGR)…
… vs. ABGSCe ’21-‘24e sales CAGR of 17%

Cloud-based technology increasingly in demand
This afternoon, we attended to Pricer’s Capital Markets Day, held at Epicenter, Stockholm. Acting CEO Magnus Larsson and CFO Susanna Zethelius were accompanied by the company’s CMO and CDO. The focus in the session was on the company’s growth prospects from a market with low penetration that is currently seeing strong demand for ESL solutions amid the current inflationary environment and shortage of labour. Furthermore, to cope with the fact that ESL and DS (Digital Signage) solutions are converging, retailers are increasingly investing in cloud-based solutions. Pricer expects this trend to accelerate, which plays into the hands of the company, as it has made significant investments in its software in recent years (Pricer Plaza). Cloud-based technology also allows for more complex ESL solutions, which is what retailers are increasingly demanding.

North America to play an important role
One of the most interesting items was its new financial targets: reach sales of SEK 4.5bn by 2025, of which recurring revenue will account for 10% (vs 2% in 2021). Its sales target corresponds to a ’21-’25 CAGR of 26%. This compares to the ABGSCe ’21-‘24e sales CAGR of 17% and Pricer’s 2016-2021 CAGR of 18%. While Pricer expects the North American market to be the main contributor to reaching this goal, it also expects EMEA to continue to grow, particularly in markets where the penetration of ESL solutions remains low (e.g. in the UK). Furthermore, with an increased share of recurring revenue, Pricer expects profitability to improve from current levels by 2025 (“return to historical levels”, which we interpret as ~10%), albeit the company cautions for continued margin pressure in the near term. This aligns well with our own view.

We see upside to consensus sales forecasts We were encouraged by the new...
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