RANPLAN GROUP AB – Interim Report July - Dec 2023
2024-02-16 08:00 CET
The period in summary
Second half of 2023 (second half of 2022)
Total income amounted to SEK 15.4 million (15.1 million)1
Net sales amounted to SEK 9.4 million (9.7 million)
Operating income amounted to SEK -9.6 million (-12.6 million)
Net income amounted to SEK -11.3 million (-13.0 million)
Earnings per share amounted to SEK -0.36 (-0.43)
Cash at the end of the period amounted to SEK 1.5 million (5.1 million)
Full year of 2023 (Full year of 2022)
Total income amounted to SEK 26.9 million (29.0 million)1
Net sales amounted to SEK 15.6 million (17.7 million)
Operating income amounted to SEK -23.8 million (-26.4 million)
Net income amounted to SEK -26.8 million (-26.7 million)
Earnings per share amounted to SEK -0.86 (-0.88)
Cash at the end of the period amounted to SEK 1.5 million (5.1 million)
The Board proposes that no dividend be paid for 2023 (no dividend).
At the end of 2023, SEK 35.9 million of the credit line was unutilised.
1 Total income comprises the sum of net sales (related to commercial products and services), other income (associated with research projects) and other operating income (derived from R&D tax credits).
Significant events in 2023
On 24 April 2023, at the AGM in Stockholm, it was resolved that Tomas Isaksson be re-elected as chairman, and that Jie Zhang, Wendy Yang and Jon Ullmark be re-elected as ordinary members of the board.
On 3 July 2023, Ranplan Wireless announced a significant order related to network design services. The order, valued at around SEK 2.5 million, is expected to be substantially revenue recognised in the second half of calendar 2023. The project – associated with additional man-hours – will be dilutive to the gross margin which absent any services elements has had a history of hovering above 95%.
On 8 December 2023, Ranplan announced that an Extraordinary General Meeting (EGM) held in Stockholm earlier in the day had resolve to carry out the Set-off-Issue proposed by the Board of Directors.
On 18 December 2023, Ranplan announced that the Swedish Companies Registration Office (“Bolagsverket”) had approved the Set-Off Issue, triggering the Mandatory Public Bid Rule (“Budplikt”) on NASDAQ First North
Significant events after the end of 2023
On 15 January 2024, Ranplan announced that Per Lindberg has, via a wholly owned company, made public a cash offer to shareholders in Ranplan Group AB, see link in Swedish below: Per Lindberg lämnar, via helägt bolag, ett kontant budpliktsbud till aktieägarna i Ranplan Group AB - Goldcup 34506 AB (cision.com)
Words from the CEO
In a cumbersome and most dire spending environment characterised by soaring costs of capital, budget constraints, industry-wide downsizing, deferred, paused or terminated investment plans, Ranplan Group managed to hold steady in calendar 2023. Losses from operations shrank noticeably in the second half of 2023 on the back of a noticeable reduction in expenditures, largely invariant net sales compared with the year-earlier period, and, not least, a doubling in income generation from externally sponsored research projects. Absent foreign exchange movements, a positive underlying trend would have been discernible.
In line with the telecom sector at large, we have taken and continue to take measures to lower our fixed costs. We do so in recognition that the prevailing slump in purchase decisions - which ostensibly bears some semblance to the TMT meltdown at the start of the new millennium (2000-2003) – necessitates a narrower focus and a re-set of priorities. We are confident that these steps will allow us to concentrate our efforts on activities that can yield positive long-term returns on investments and that our competitive position will be further enhanced. Whilst the duration of the prevailing spending climate is fraught with considerable uncertainty, the value of our products and services is not. Besides, history shows with ample clarity that an extended spending hiatus paves the ways for pent-up demand spurred by catch-up effects.
Disappointing order intake aside, we sense robust (fundamental) interest in our offerings. In 2023, we had engaged with hundreds of existing and prospective customers, carried out a record-high number of demos (sessions showing the capabilities of our tools) and closed several key deals with some of the most influential actors in our space. All the world’s leading OEMs (Original Equipment Manufacturers) now use our software for the perfection of wireless networks. In Japan and Korea – known as the front-running markets of 5G for advanced industrial applications – we have now garnered 20 prominent customers.
Our expertise, knowledge and technology attract broad attention, as evidenced by the FutureNet event in Singapore last autumn. Within the category of “The most innovative application of AI &Automation to enhance customer experience in APAC”, we were shortlisted amongst five contenders alongside organisations - all of whom existing customers of Ranplan – that are orders of magnitude larger, namely AsiaInfo Technologies/China Mobile Tianjin, Ericsson/TPG, Huawei, and Rakuten Mobile/Symphony. On this occasion, we were recognised for enabling a precisely planned, optimised and validated 5G network for a smart factory together with our customer Sumitomo Shoji Machinex and our local reseller Marubun.
Private Wireless, a premium segment requiring premium radio planning and optimisation tools from both an indoor and outdoor perspective, is at the heart of our value proposition. This is where professional grade software plays a pivotal role in meeting the most exacting customer requirements with respect to latency, predictability and reliability of connectivity, as well as integrity and security. Thanks to our ability to accurately and precisely model the propagation of radio waves on either side of the walls of buildings (or more generally physical impediments) in one holistic software application, we can most convincingly help customers control interference between the public and private domains – of utmost importance to ensuring the effective re-use of spectral resources without compromising network performance (and by extension user experience). Whilst this market is still in its formative years, we harbour little doubt that it will enter into a mass-market phase in the latter part of this decade. In the meantime, we will endeavour to demonstrate how the most advanced of wireless technologies can catapult automation on the factory floors, inside the warehouses, and within the smart cities of the future. This is an arena where 5G/6G makes a difference compared with earlier generation of cellular. This is where our expertise comes handy.
Amid the emergence of dedicated networks, we are keen to provide design as a service. In so doing, we lower the barriers to entry; we shorten time-to-market; and we expand the scope of our offerings. A prime example setting the scene for similar undertakings comes from America where we help design a private network for a large and important semi-conductor plant currently under construction. At this stage, we detect interest in design as a service from customers in most parts of the world, including Asia-Pacific. As an adjunct to the design of networks, we will also seek to help customers migrate legacy project data to formats that can be easily imported into our own tools. Through the provision of such services, we will allow existing and prospective customers to break free from vendor lock-ins which hamper their choices.
In full consistency with our philosophy of openness and interoperability, we will embrace and support open file formats in the spirit of BIM (“Building Information Modelling”). In conjunction with the latest software release launched last year, we introduced .IFC (a standardised open BIM format) as an input file that our software can read and use for wireless design analytics. The next release, dubbed 7.0, is scheduled to incorporate BIM/.IFC also as output files that can be drawn directly from our software and be shared with other parties. We envisage that these developments will be recognised for the multi-faceted benefits they bring. Once established as a de facto standard, BIM will allow customers to much more easily switch software suppliers, exchange data between systems, and automate their operations.
In 2024, we will continue to adapt our operations to the prevailing climate without jeopardising the attractiveness, competitiveness, and innovativeness of our core offerings. We will invest more in areas – encompassing products and markets - where we see positive (risk-adjusted) returns and less in those where prospective rewards are less compelling. Whilst not possessing sufficient visibility in terms of the net sales side to be able to provide overall financial guidance for calendar 2024, we expect income from Research Projects to hold up at least at current levels, mitigating an expected reduction of tax credits. To unleash the value of our products and services, we seek go-to-market and system-development partnerships which complement us, bolster our end-to-end offerings, broaden and deepen our channels.
Following the set-off issue in December, the balance sheet was re-inforced and the maturity of the credit line was extended until the end of February 2025 (from a previous end of July 2024). As a corollary, the company ended 2023 with a healthy payment capacity (barring any materially disruptive events outside our control). Net current assets and unutilised funds from the credit line amounted to more than SEK 44 million at the start of 2024 – representing almost twice the net consumption of cash recorded in 2023. The debt-for-equity swap triggered activation of the Public Bid Rule (“Budpliktsregeln”) and subsequent changes in the ownership structure of the company which may ease the path to further capital injections.
Per Lindberg, CEO
The complete report is attached to this press release and is available at www.ranplanwireless.com
This disclosure contains information that Ranplan Wireless 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 16-02-2024 08:00 CET.
