Management change in Talkpool Group
The Board of Directors of Talkpool AG has appointed its Chairman Magnus Sparrholm as Chief Executive Officer (CEO) ad interim of the Talkpool Group until further notice. Erik Strömstedt, who has led the company for many years, will work closely with Mr Sparrholm to finalize the ongoing turnaround with a focus on telecommunications network services in existing markets.
Talkpool has experienced positive financial performance in recent years with improved margins, lower financing costs and an improved balance sheet. The company is targeting profit margins of 30% gross margin, 15% Earnings Before Interest, Tax, Depreciation & Amortization (EBITDA) and 10% net Earnings After Tax (EAT) for the business going forward. Talkpool has repaid most of the €7.2 million interest-bearing debt it had two years ago. The ongoing debt repayments continue straining limited cash reserves. The business is now significantly leaner and more manageable, having been reduced from over ten markets to four. After finalising the turn-around in coming months, Talkpool is set to enter a new phase of controlled growth in 2024.
Rather than embarking on a challenging high-risk, high-reward investment banking route with substantial investments and acquisitions, the new management plans to streamline the business into a more traditional engineering services company. In addition to continuing its core business of planning, optimising, and maintaining telecoms networks, Talkpool intends to increase the use of technology in its service offerings. Instead of developing its own solutions, Talkpool will resell and integrate technology from other companies. This will allow Talkpool to meet customer demand for automation offerings without having to make large investments.
In the short term, Talkpool’s management will focus on accelerating the sale of Talkpool's 89% stake in the largest telecom network services company in Pakistan. The aim is to complete the sale of the Pakistani shareholding before the end of the year with a valuation of US$4 million. Following the sale of the Pakistan business, Talkpool has secured its own growth funding for the foreseeable future.
Finally, Talkpool will work to significantly increase the value of the TALK share from the current price of around SEK 4 per share. With a total of 6’778’097 shares, Talkpool is currently valued to approximately SEK 27 million, or 2.3 million Euros. Talkpool’s management has an ambition to introduce a dividend and share buy-back scheme as soon as the liquidity allows for doing so, tentatively latest by the end of year 2024.
This disclosure contains information that TalkPool AG 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 27-10-2023 20:00 CET.
