Talenom Oyj - Interim report (Q1 and Q3)

Talenom Plc's Business Review January-March 2024: EBITDA improved by 13.4% and strategy implementation progressed

Talenom Plc, Stock Exchange Release 18 April 2024 at 9:00 EEST

Talenom Plc’s Business Review January-March 2024: EBITDA improved by 13.4% and strategy implementation progressed

January–March 2024 in brief

• Net sales EUR 34.1 million (31.3), growth 8.8% (24.2)
• EBITDA EUR 9.5 million (8.4), 27.9% (26.7) of net sales
• Operating profit (EBIT) EUR 3.9 million (3.5), 11.3% (11.0) of net sales
• Net profit EUR 2.0 million (2.1)
• Earnings per share EUR 0.04 (0.05)

Key figures

Group	1–3/2024	1–3/2023	Change, %
Net sales, EUR 1,000	34,053	31,311	8.8%
Net sales, increase %	8.8%	24.2%
EBITDA, EUR 1,000	9,486	8,365	13.4%
EBITDA of net sales, %	27.9%	26.7%
Operating profit (EBIT), EUR 1,000	3,855	3,458	11.5%
Operating profit (EBIT), as % of net sales	11.3%	11.0%
Return on investment (ROI), % (rolling 12 months)	6.0%	11.7%
Interest-bearing net liabilities, EUR 1,000	84,697	68,060	24.4%
Net gearing ratio, %	171.5%	130.2%
Equity ratio, %	26.9%	31.4%
Net investments, EUR 1,000	8,359	12,641	-33.9%
Liquid assets, EUR 1,000	12,314	13,255	-7.1%
Earnings per share, EUR	0.04	0.05	-2.3%
Weighted average number of shares during the period	45,434,562	44,893,388	1.2%
Net profit, EUR 1,000	2,034	2,057	-1.1%

Guidance for 2024 unchanged

Talenom estimates that 2024 net sales will be about EUR 130–140 million, EBITDA EUR 34–40 million and operating profit EUR 14–17 million.  

CEO Otto-Pekka Huhtala

The first quarter of the year got off to a strong start. Improving operational efficiency, launching our platform in Sweden and accelerating organic growth are our strategic priorities for the current year. The profitability turnaround has progressed and is beginning to be reflected in higher EBITDA. In Sweden, we were able to migrate customers to our own platform in line with our targets. Our goal is to migrate at least 50% of our regular reporting customers to our own systems during 2024. Based on the experience in Finland, the introduction of Talenom's processes and platform enables reducing routine work time by up to 75%. To strengthen organic growth, we continued to develop the digital purchase path and made key hires to support growth.

Net sales grew by 8.8% (24.2) to EUR 34.1 (31.3) million in the first quarter of 2024. The economic downturn has had a negative impact on the business volumes of our customers in Finland and Sweden. This has resulted in a reduction in transaction volumes for Talenom, which has led to a decrease in customer invoicing. Business closures and bankruptcies have also increased. The impact of the economic downturn and customer churn was offset by new customer acquisition. Profitability improved: EBITDA rose by 13.4% to EUR 9.5 (8.4) million, while operating profit increased to EUR 3.9 (3.5) million. Profitability in Finland was significantly improved by efficiency measures launched in 2023, while in Sweden the introduction of own software burdened profitability. In Spain, the growth in business volume has enabled profitability to develop well.

Despite the challenging short-term economic environment, we are positive about the future. Talenom's unique approach combines accounting and banking services with a proprietary software platform. Over 90% of net sales are recurring, providing a solid foundation for the company's long-term development.

Webcast

CEO Otto-Pekka Huhtala and CFO Matti Eilonen will present the main points of the review in a live webcast today on 18 April 2024 at 10:00 EEST (in Finnish) and at 12:00 EEST (in English). Recordings of the events will be published on Talenom’s website https://investors.talenom.com/fi/ and https://investors.talenom.com/en

You can watch the webcast live in Finnish at 10:00 EEST at https://talenom.videosync.fi/q1-2024
You can watch the webcast live in English at 12:00 EEST at https://talenom.videosync.fi/q1-2024-en

The presentation materials will be published before the start of the briefing on the company’s website.

Talenom Plc
Board of Directors

Further information:
Otto-Pekka Huhtala
CEO, Talenom Plc
+358 40 703 8554
otto-pekka.huhtala@talenom.fi

Talenom in brief

Talenom is an agile and progressive accounting firm established in 1972. Our business idea is to make daily life easier for entrepreneurs with the easiest-to-use digital tools on the market and highly automated services. In addition to comprehensive accounting services, we support our customers’ business with a wide range of expert services, as well as financing, account and payment traffic services. Our vision is to provide superior accounting, account and payment traffic services for SMEs.

Talenom’s growth history is strong – average annual net sales growth was approximately 17% between 2005 and 2023. In 2023, Talenom’s net sales was some EUR 122 million and the company had 1,560 employees in Finland, Sweden, Spain and Italy at the end of the year. Talenom’s share is quoted on the Main Market of Nasdaq Helsinki. Read more: investors.talenom.com/en

Attachments:

Talenom Business Review Q1 2024.pdf