Interim Report January-September 2019

23 percent growth and stronger profitability

Third quarter

• Net sales amounted to MSEK 68.0 (55.4), rendering a net sales growth of 23% (23%). Organic net sales growth was 18% (18%)
• Recurring revenue amounted to MSEK 42.5 (35.2)
• The quarter was impacted by one-off items affecting comparison amounting to MSEK 0.0 (1.4) attributable to acquisitions and in the third quarter 2018 to the listing of the company’s shares on Nasdaq Stockholm
• Adjusted EBITA amounted to MSEK 19.3 (15.6) which corresponds to an adjusted EBITA margin of 28% (28%)
• Net income amounted to MSEK 12.1 (8.1)
• Earnings per share, before dilution, amounted to SEK 0.91 (0.65) and diluted to SEK 0.91 (0.61)

The first nine months

• Net sales amounted to MSEK 207.9 (175.4), rendering a net sales growth of 19% (20%). Organic net sales growth was 17% (15%)
• Recurring revenue amounted to MSEK 122.9 (101.3)
• The first nine months were impacted by one-off items affecting comparison amounting to MSEK 0.9 (2.6) attributable to acquisitions and the listing of the company’s shares on Nasdaq Stockholm
• Adjusted EBITA amounted to MSEK 46.9 (38.8) which corresponds to an adjusted EBITA margin of 23% (22%)
• Net income amounted to MSEK 27.0 (20.1)
• Earnings per share, before dilution, amounted to SEK 2.03 (1.61) and diluted to SEK 2.03 (1.51)
• Acquired 58% of More Intenz AB and 30% of janjoo AB to further strengthen competitiveness

CEO’s comments

I hope everyone has had a nice and relaxing summer. At Lime, we feel reinvigorated after our holidays and have since been focused on developing existing and finding new customers, integrating our recent business acquisitions – janjoo and More intenz – as well training some 40 new talented colleagues.

Growth during Q3 2019 reached 23%, of which organic growth was 18% compared to the same period last year. Organic growth is largely attributed to subscription sales with 22% growth in ARR. Sweden, which had a weaker second quarter, performed strongly in the third quarter and grew by 17% compared to the same period last year. One improvement factor was the stronger chargeability rate in Expert Services. The positive trend in the rest of the Nordic region continued with total growth of 54% and an increase in subscription revenue of 74%.

As mentioned, we have recruited more staff than previously. This investment has led to third quarter personnel expenses having increased more than originally forecasted. Despite this, we have been able to improve profitability, with EBITA reaching 28% compared to 26% for the same period last year.

Order intake have been strong during the first nine months, meaning we still have many business opportunities to work with during the coming quarters. Our overall assessment indicates that demand from our customers is the same as during the last few quarters. That being said, the changes we have made in recent years mean we are well prepared for possible market fluctuations, as we today have a significant proportion of recurring revenue, low customer concentration and four different focus verticals with varying degrees of cyclical sensitivity.

There is a strong correlation between our recruitment efforts today and our growth in two - three years. If and when we approach a weakening in the market, Lime sees this as an opportunity to utilise our profitability to recruit more talented staff. In such a situation, we will prioritise, as previously mentioned, growth over profitability in the short term.

Our strategy in the coming period is based on continued long-term profitable growth. Our focus remains the same: to become the leading CRM supplier in the Nordics. This means a continued focus on finding new customers and developing our existing customers within the Nordic countries. We see a large potential in selling the add-on modules acquired through our acquisitions, not least through the most recent acquisitions of More intenz and janjoo, which were completed on July 1 this year. At the same time, we are continuing to look for new companies that can further strengthen our product portfolio.

Furthermore, we plan to establish the first office outside the Nordic region in 2020. A review will be initiated in the fourth quarter to look at where and how to proceed with the process. As earlier communicated, we are mainly looking at Germany, the Netherlands, Belgium, and the UK.

What is most exciting about running a rapid growth company is the constant development of things that help our customers grow, all our employees and the company at large. To make Lime even more scalable and to limit our vulnerability in the future, we have decided to promote our Head of Sales Nils Olsson to Chief Operating Officer (COO). Nils has been with Lime since 2006 and has progressed from being a skilled sales representative and Head of Sales to a leader who is involved in most of the company’s operations. As COO, Nils will be responsible for sales, Expert Services and support. Nils will take up the new role at the start of the next year.

We are now in what is traditionally our best period of the year, the fourth quarter, with many new releases, deliveries to fulfil, and a number of new deals to close. We are looking forward to this. We are not done recruiting. We are constantly looking for new colleagues. Do you know of any skilled and driven developers, sales representatives, or project managers who would fit into our family-like company culture? Tell them to contact us. We still need more entrepreneurs and intrapreneurs in order to continue our long-term profitable growth.

/Erik Syrén, President and CEO of Lime Technologies AB (publ)

Read the entire report in the attached PDF.  

Invitation to webcast for the presentation of Lime Technologies’ Interim Report for January-September 2019

On Friday, October 25, at 09:30 CEST, are analysts, investors, media and other interested parties invited to attend a webcast where Lime’s CEO, Erik Syrén, and CFO, Magnus Hansson, will comment on the published report and answer questions. The presentation will be held in English.

The presentation material will be available on Lime’s website.

The link to the webcast can be found here.

For more information, contact:

Lime Technologies AB (publ)

Erik Syrén, CEO / +46 707-38 50 72 / erik.syren@lime.tech
Magnus Hansson, CFO / +46 708-55 55 40 / magnus.hansson@lime.tech
Johan Holmqvist, Head of IR, retiring /+46 708-37 66 77 / johan.holmqvist@lime.tech
Lars Andersson, CXO (& future Head of IR) /+46 704-33 53 83 / lars.andersson@lime.tech

This information constituted inside information prior to publication. This is information that Lime Technologies AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 08.00 CEST on October 25, 2019. 

About Lime

Lime helps businesses all over the Nordics to become better at customer care. The company develops and sells digital products for ”Customer Relationship Management”, development and management of customer relationships. Lime was founded in 1990 and has 250 employees. The company has offices in Lund, Stockholm, Gothenburg, Oslo, Copenhagen and Helsinki. Their customers include everything from sole traders to large organisations. www.lime-technologies.com

Tags: