Fondia Plc Group: Half Year Financial Report, 1 January to 30 June 2021 - Second quarter turns the revenue to growth track – strong growth in Sweden

Fondia Plc Group

Press release

26 August 2021 at 16:45 EEST

Fondia Plc Group: Half Year Financial Report, 1 January to 30 June 2021 (Unaudited and unofficial translation)
 

Figures in parentheses refer to the corresponding period of the previous year, unless otherwise stated.

January – June 2021 summary:

• Net sales totalled €10.7 million (10.5), a change of + 1.1%.

• Continuous monthly invoicing (LDaaS) accounted for 45% (42) of net sales.
• EBITDA was €1 million (1.3), and the EBITDA margin was 9.1% (12.7).
• Operating profit (EBIT) was €0.6 million (1.1), and the operating margin was 6.0% (10.2).
• Profit for the period was €0.5 million (0.7).
• Average number of employees (FTE) 129 (133).

April – June 2021 summary:

• Net sales of €5.4 million (5.1), a change of + 6.5%.

• EBITDA was €0.5 million (0.7), and the EBITDA margin was 9.0% (14.2).
• Operating profit (EBIT) was €0.3 million (1.1), and the operating margin was 5.7% (11.4).
• Average number of employees (FTE) 133 (131).

KEY FIGURES

CEO Leena Hellfors

“Fondia’s revenue increased by 6.5% to 5.4 million euros (5.1) between April and June. The improved demand at the beginning of the year was reflected in revenue growth in the second quarter in all Fondia countries. Our net sales in the first half of the year increased by 1.1% to 10.7 million euros (10.5). The improved demand was reflected in, among other things, the opening of the acquisition market and the increase in legal development needs of our legal department clients, for example, in the form of public procurement and data protection.

In the Swedish business, the entire beginning of the year was a period of strong growth, with revenue increasing by 27.9% compared to the comparison period. We have won several significant new legal department clients in Sweden and increased awareness of our services in various client groups. In addition to our own expertise, we have utilised our productised services in customer acquisition, which facilitate the sale and purchase of legal services. Our productised services (such as DPO as a Service and Secondment as a Service) have had a significant impact on growth, especially in the Swedish market. These new conquests, for example in the services provided to large companies, will enable our personnel to develop new and interesting industry expertise, as well as increase our brand visibility in geographically new parts of the country.

The Baltic business also continued to grow well. The teams have gained local LDaaS customers in the Baltics, which together with our improved cross-border working model have particularly impacted growth in the Baltics. In Finland, the development of our revenue during the year has been slowed down by the higher personnel turnover and the onboarding of new lawyers. However, we have been able to make the onboarding process more efficient and significantly alleviate the decline in productivity. During the efficient onboarding period, our newcomers have already proven the strength of their networks and had an excellent start in both customer work and commercial operations.

Our LDaaS legal department service has proven its strength throughout the coronavirus pandemic in terms of both steady revenue and high customer satisfaction. Our LDaaS services accounted for 45% (42) of total revenue between January and June. Despite personnel turnover at the beginning of the year, our client retention has remained at a very high level, and individual changes in lawyer teams have not had an impact on our high client satisfaction.

Between April and June, EBITDA was 0.5 million euros (0.7) and EBIT 0.3 million euros (0.6). In the first half of the year, EBITDA was 1.0 million euros (1.3), and EBIT was 0.6 million euros (1.1). Profitability in the first half of the year was weakened by investments in our digital development project in line with our strategy, investments in our new office that opened in January 2021, and increased recruitment costs. The development of profitability between April and June was also affected by the fact that the positive impact of the coronavirus pandemic on the cost level remained small compared to the comparison period.

The beginning of the year has been a time of intense recruitment. During the second quarter, in addition to our legal expertise, we have also strengthened our sales organisation as demand gradually returns to pre-pandemic levels. With our new Legal Tech-focused recruitments, we have, in turn, expanded our internal capabilities and will take significant steps in line with our strategy towards documentation automation later in the year.

Our CREDU development project has progressed according to plan and as part of it, the conceptual work on our work platform MyFondia has started on schedule. Our goal is to further enhance our work with customers and create an internationally scalable MyFondia platform.

During the second quarter, Fondia returned to a track of growth. We are confident that this growth will continue during the latter part of the year and that we will reach our target of the breakeven point in Sweden and the Baltic countries.”

The whole financial report is to be found attached as a pdf and on the company's investor relations site www.fondia.com/sijoittajille.
 

PRESS AND ANALYST CONFERENCE

Fondia will publish its half year financial report for January to June 2021 on Thursday 26 August 2021 at 08:30. A press and analyst conference will be held in Finnish on the same day at 12:30 at Fondia’s headquarters at Aleksanterinkatu 11, Helsinki. The report will be presented by CEO Leena Hellfors.

Due to the prevailing coronavirus situation, please register your intention to attend the conference in person in advance by emailing us at ir@fondia.com.

You can watch a livestream of the presentation at https://www.inderes.fi/fi/videot/fondia-q221-268-kello-1230

The livestream recording and presentation materials will be published later at www.fondia.com/sijoittajille.

Helsinki, 26 August 2021

Fondia Plc Board of Directors

For further information, please contact:

CEO Leena Hellfors

tel. +358 (0)20 7205 698

Approved Advisor Alexander Corporate Finance Ltd

tel. +358 (0)50 520 4098

FONDIA IN BRIEF

Fondia is a full-service business law firm that offers new service models and utilises digital technologies. Fondia operates in Finland, Sweden, Estonia, and Lithuania, and the Group’s net sales in 2020 were approximately €19.6 million. Fondia employs more than 150 people.

www.fondia.com

Distribution:

Nasdaq Helsinki

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