Interim report, January - June 2022
In Q2 2022 net sales increased by 14.4% compared to Q2 2021. Consolidated net sales ended at 61,066 (SEK 000s). EBITDA totaled to -30,988 (SEK 000s). Operating profit, EBIT, was -52,286 (SEK 000s). Profit after tax was -63,669 (SEK 000s). Earnings per share was SEK -0.94.
For 1H 2022 net sales increased by 24.0% compared to 1H 2021. Consolidated net sales ended at 126,383 (SEK 000s). EBITDA totaled to -47,253 (SEK 000s). Operating profit, EBIT, was -88,410 (SEK 000s). Profit after tax was -92,840 (SEK 000s). Earnings per share was SEK -1.37.
CEO's comments
Moderate growth in first half of 2022, key product launches ahead
24SevenOffice’s financials performance has been lower than expected through the first half and we expect the same trend in nearest quarters. Seeing the organization and acquisitions are becoming more integrated, along with exciting product launches through the fall, we still have high ambitions and continue to work relentlessly targeting profitable growth.
The financial results for the first half of the year show a moderate growth to MSEK 126.4 in revenue, a 24.0% increase from last year, with a negative EBITDA of MSEK 47.3. During the second quarter the company had MSEK 61.1 in revenues, 14.4% up from last year, with a negative EBITDA of MSEK 31.0.
As communicated in July’s profit warning, the Optin bank situation has had a negative impact on 24SevenOffice’s profit and growth journey this year due to amongst others that the situation made expected profits and return on investment lower. The majority of the effect has materialized in Q2, but the following-effects are expected to last 3-4 quarters ahead.
We are also expecting a temporary negative effect on the marketing lead generation by having replaced the full marketing department during the first half of the year, particularly affecting the new sales in Sweden where our brand is still progressing. Nonetheless, we remain enthusiastic for the future, having several existing and new growth areas developing, expected to generate long term value for our customers and investors.
Busy by 24SevenOffice, which is a 24SevenOffice backed time registration and project management start-up, is continuing its strong growth in attractive industries across creative bureaus, and is now also expanding focus towards the consulting industry. They are targeting an ARR-base of more than MSEK 7 in 2022, up from MSEK 0.3 at the time of purchase and is highlighting 24SevenOffice’s capabilities in building sustainable growth machines.
We are experiencing a similar growth journey across our investments into pay-roll, AI-accounting and the material & resource planning tool MRP. To illustrate this, our pay-roll module went from paying out approximately BSEK 2 by the end of the first quarter, to now having paid out BSEK 4 in paid salaries. Outstanding work and joint effort by our pay-roll team along with our partners.
Moreover, we are launching the invoice reminder and payment collection to the market at the start of September, where we are expecting strong synergies to automatize the flow across the accounting, payment and collection space. As the fintech and payment market is enormous, we still have high expectations for our accounting and ERP platform, but the results will most likely not manifest until the end of 2023.
Another positive highlight of this quarter is that we are successfully onboarding the remaining relevant customers onto the new pricing model throughout the next month, which will generate revenues that scales with the clients’ degree of automation and usage. This has been a two year long and substantial resource draining project from all departments in the company finally coming to an end.
Building the organization for the future
One of the most important responsibilities of a CEO is to attract and retain high-performing talents. From entering into the CEO-role, I have had a particular focus on recruiting high-quality employees. I am incredibly delighted to now have on-boarded two new great leaders in the management group; Geir Beinset as the new COO and Markus Svenberg as the new CMO. Combined, they have extensive experience within marketing, analytics, strategy and tech.
Our new-hires will surely increase attention on becoming a 100% data driven organization, connecting our digital business model to new business models for our customers, ultimately supporting our ambition for profitable growth. As an example, we have already launched our digital chatbot Henni, which is now driving both increased productivity for the customers teams, satisfaction for our customers and up-sell potential for 24SevenOffice.
With the resilient team we now have in place, along with all our trusted customers and partners, I am certain we have the foundation to excel through the ever-changing and challenging environments and geopolitical situations we are facing, and I am looking forward to pushing 24SevenOffice to new heights ahead.
This disclosure contains information that 24SevenOffice Scandinavia AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 25-08-2022 08:00 CET.
