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Trading Update: Sales/ARR update new modules and profitable growth ahead

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24SevenOffice Group AB, a leading SaaS ERP company, is pleased to confirm positive developments in recently launched modules. This strengthens the growth and profitability outlook of the company.

24SevenOffice has invested significantly the last 2 years in continued development, integration and rollout of new revenue generating functionality and modules. 24SevenOffice has launched a payroll system that works both in Norway and Sweden, continued to integrate and roll out the scalable AI accounting system and continued to develop and roll out the new payment reminder and debt collection system which is currently only launched in Norway. 

While these investments have contributed to a significant short term negative EBITDA for the previous quarters, they have now achieved three strong revenue based milestones:

  • We have passed 45 MSEK in ARR (annual recurring revenue) from the three new growth modules
  • The modules are expected to show a significant growth rate in the coming quarters compared to previous quarters, and the growth modules are now profitable going forward
  • We have passed 30 000 payslips each month that are being processed through our new payroll system and our first +1 MSEK ARR pay-roll customer was signed this summer

24SevenOffice is excited to continue on the profitable growth journey in 2024, and we remain confident in reaching profitability in the second half of 2023 as previously communicated. 

The ARR level is a particularly important milestone since the typical valuation multiple for  SaaS ERP companies is approximately 8-9 times revenue (see link below for source), which implies that these growth investments may alone already have added approximately 4 times more potential future value for our shareholders (400 MSEK) than the entire investment loss last year (approximately 100 MSEK negative EBITDA). 

As commented earlier, we have also during the same period invested in several other new modules and technologies like HRM, MRP, Fintech, as well as a major rewriting and rebuilding of the new tech stack across the core system with new UI/UX and an enhanced marketing and sales engine. With the full effect of these, we expect an even higher real factor return on the investments going forward.

Lastly, the uptake of AI accounting is of particular importance, as this shows that more and more medium sized companies start embracing AI in their daily business. We would also like to emphasize the fact that the Fintech solutions including factoring, credit facilities, and “buy now pay later”-functionality, which we believe is the biggest opportunity of them all, are still not launched due to external reasons previously communicated.

Source for average ARR factors: https://softwareequity.com/research/seg-saas-update-august-2023

For further information please contact:

Eirik Aalvik Stranden, CEO

Tel: +47 247 00 030, eas@24sevenoffice.com

24SevenOffice in brief

24SevenOffice's vision is to empower businesses for the future, through delivering world class cloud based business systems. The business system is module-based, where the modules are provided independently or packaged as complete solutions. For more information see www.24sevenoffice.com

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