This is a translation of the Swedish interim report. If there should be any discrepancies, the Swedish language version governs.
The interim report for the third quarter 2022 is available at https://nepa.com/investor-relations/.
THIRD QUARTER, JULY -
- Net sales increased by 4.2%, or 1.6% FX adjusted, to MSEK 69.5 (66.7)
- Gross profit decreased by 2.4%, or 5.3% FX adjusted, to MSEK 51.9 (53.1)
- EBIT was MSEK 4.9 (11.1)
- Earnings after tax was MSEK 5.5 (10.2)
-
Earnings per share was
SEK 0.70 (1.29)
NINE MONTHS, JANUARY -
- Net sales increased by 8.8%, or 6.5% FX adjusted, to MSEK 235.9 (216.8)
- Gross profit increased by 7.6%, or 4.8% FX adjusted, to MSEK 181.0 (168.3)
- EBIT was MSEK 23.4 (29.3)
- Earnings after tax was MSEK 22.3 (28.1)
-
Earnings per share was
SEK 2.84 (3.58)
IMPORTANT EVENTS
DURING THE PERIOD
- It was announced that Ferry Wolswinkel was recruited to the newly established role Chief Revenue Officer (CRO) starting in October.
Ann-Christine Fick resigned as CFO on her own request.
AFTER THE PERIOD ENDED
Sonja Thorngren was recruited as new CFO and starts onFebruary 6 th, 2023. Current Head of Accounting,Elin Nordholm , will assume the role as deputy CFO afterAnn-Christine Fick's departure until Sonja takes office.
A WORD FROM OUR CEO
The demand for our cutting-edge brand and marketing insights improved during the third quarter, compared to the corresponding period last year. Net sales increased by 4.2 percent to 69.5 MSEK (66.7), or 1.6 percent in local currencies. Our third quarter is usually the weakest, and this year we met a tough comparable sales growth from the third quarter 2021. In addition, we experienced a more hesitant attitude toward marketing investments among our customers after the holiday season, and thus investment decisions for marketing insights tended to be postponed.
Strong growth for Marketing Optimization
Our single largest solution area, Marketing Optimization (MO), showed continued strength as it grew by 17 percent compared to the corresponding quarter last year. The rapidly changing world creates a great need for more precise and efficient measurement of marketing and media investments. This strengthens the case for our MO services including Brand Tracking, Campaign Evaluation and Marketing
Our strategic expansion phase builds on transitioning the business towards Marketing Optimization and a recurring business model but implies a short-term drop in revenue due to fewer ad hoc sales. Despite this transition, we still generated a gross profit of 51.9 MSEK (53.1) for a margin of 74.7 percent (79.7). The operating profit (EBIT) amounted to 4.9 MSEK (11.1) for a margin of 7.1 percent (16.6). Operational personnel costs remained at a steady level in relation to sales, a cost level we expect to decline over the course of 2023 as a result of increased sales efforts coupled with OPEX scalability. During the quarter, we continued our brandtech investments in our Marketing Optimization platform, something that contributed substantially to the increase in personnel costs. Unfortunately, we were forced to make a client loss of 0.3 MSEK in connection with a bankruptcy proceeding. However, we consider the risk of further client losses to be negligible. Our net financial position amounted to 62.5 MSEK (78.5), a decrease mainly attributable to short-term working capital seasonality that we usually experience in the third quarter.
Award-winning brand technology
Our product development team attracted international attention and won the Insight250 award at the annual industry event ESOMAR in September. Together with
Outlook
We see that our investments in sales and marketing are yielding results in terms of leads and prospects, however, accelerating our efforts amid potential economic headwinds will require us to work even harder in order to reach success. Nevertheless, I want to reiterate the strength of our recurring business model in which we have proved our ability to bring in large international clients and build long-term relationships. Therefore, we continue to focus our work on profitable growth in the long term. This is widely in accordance with the establishment of our sales organization and investment in a more efficient delivery process. We have good cost control and have in the fourth quarter taken measures saving 7.2 MSEK of operational personnel costs on an annual basis to adapt our cost base and prepare for a potentially weaker market development. In addition, we have initiated the precautionary measure of a hiring freeze in
CEO
For further information, please contact:
+46 708 226 618 +46 708 788 019
ub@nepa.com michael.wallin@nepa.com
This is a translation of the Swedish interim report. If there should be any discrepancies, the Swedish language version governs. The Swedish version is information that
About Nepa
Nepa, a leader in Brand Experience and Marketing Optimization, helps some of the world's most reputable brands drive growth through data. This is achieved by combining first-class research, cutting-edge technology, deep expertise, and innovative solutions. Headquartered in
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