Talkpool Interim Report, January - September 2021

  July - September key developments

•      Talkpool achieved the highest quarterly Net Income since its IPO in Mai 2016

•      Sales increased with 14% and EBITDA increased 25% year on year

•      Talkpool Germany was awarded two new planning frame agreements worth EUR 1m

•      Talkpool Pakistan received new orders for drive test and swap projects worth EUR 1 m

•      TP Germany initiated an air quality control solution pilot project in Leipzig called “air4 schools”

•      Record sales generated in Talkpool AB in September thanks to high order intakes

•      Talkpool Netherlands’ revenue was boosted by an add-on order for sandy ground towers

•      Talkpool re-entered the US market and acquired 100% of the shares in the dormant Talkpool LLC

•      A focused sales force hiring was conducted in several markets as a part of Talkpool’s growth strategy

CEO Comments

Talkpool continued to pursue its turnaround strategy and achieved the highest quarterly Net Earnings since the IPO in May 2016.

Thanks to a fast and efficient integration of Nordic PropTech in the group and significant investments in the global sales force, the implementation of the strategy communicated in the Grand Master Plan II in May already started in Q3. The plan states that Talkpool shall become a leading provider of digitization solutions and services for buildings and communications infrastructure, with focus on management of energy, water, and air.

Significant up sale orders in Germany, Pakistan, Sweden, Haiti, and the Netherlands, combined with new sales opportunities in the US and the Caribbean in Q3 constitute the basis for a sustainable organic growth during the coming quarters.

Network Services

Talkpool Germany secured new framework agreements for network planning and documentation, worth over EUR 1 million. The term extends into the 3rd quarter of 2023. Talkpool is thus further expanding its market presence and range of services in Germany. This now extends far beyond the planning and documentation of classic copper cable house connections to network planning and documentation of fibre optic house connections for private households, schools, offices and 5G sites.

Based on requests for cellular IoT network roll out services and a massive need for planning and construction services for 5G cellular sites and towers in Germany, Talkpool hired additional network services staff to drive business development and expand the delivery organization.

The convergence of Network Services and IoT in 5G is one of the key drivers in Talkpool’s new digitization strategy and we expect the opportunities with operators and tower companies in Germany as well as the rest of Europe and the US to fuel the demand for cellular IoT connectivity and solutions.

As a step in Talkpool’s strategy to focus on highly developed and industrialized markets, Talkpool is re-entering the US market. The 5G and fibre network implementations in the US is creating a high demand for network expertise and services. To meet client requests for services on the US mainland and in the Caribbean, Talkpool has acquired 100% of the shares in Talkpool LLC, which fully owns the operational Talkpool Services LLC entity.

Talkpool has long experience of delivering mobile network services to vendors and operators in the Americas and we are glad to enter the US market again. To support both the US market and the Caribbean in the best way possible the operational company Talkpool Services LLC has been relocated to Miami, FL.

Talkpool Pakistan signed several promising business agreements during the quarter. In competition with strong competitors the company won a network testing contract with one of the largest mobile network operators in the country worth around EUR 700 thousand per year. Talkpool Pakistan also won a major contract for the installation of network devices with ZTE worth EUR 200 thousand and digitization orders worth EUR 100 thousand. Furthermore, the company is running several tests on digitization solutions which, if successful, can lead to major orders before the end of the year. To staff the new projects Talkpool increased the number of employees in Pakistan from around 800 to approximately 1 100 in Q3.

The 5G roll outs also continued to generate more niche work and opportunities for cellular tower construction work in the Netherlands. An add on order of sandy ground towers for 5G from a major tower company boosted revenue in Q3.

Amidst civil unrest, fuel shortage and a major earthquake in Haiti in Q3, Talkpool continued to support Digicel in its mission to guarantee reliable communication services to the Haitian people. Despite the challenges our business sustained and developed positively throughout the quarter.

IoT

In Q3 the merger of the two businesses in Talkpool AB and Nordic PropTech Investment Services AB(NPTIS) progressed well under the management of the new CEO Andreas Göth. The business synergies between the Smart Buildings Solutions offering for commercial buildings from Talkpool AB and the offering for residential buildings from NPTIS will create a new market leading IoT company in the Swedish Smart Buildings market with international growth potential through its owners. The size and the market position of the new company will open new doors and enable an attractive as-a-service offering.

Aa one of several large business opportunities, the new merged sales organization initiated promising negotiations regarding an as-a-Service solution with an existing customer during the third quarter.

The demand for NPTIS’ services of measuring and managing natural resources such as air, water and electricity in individual apartments and premises is rapidly increasing, stimulated by new regulations and the upcoming building digitisation boom. Growth through acquisitions of further metering companies and up-selling of sustainable technology “as a service” to the many existing clients is central in Talkpool’s strategic plan going forward.

A new inhouse IoT platform is under development in NPTIS to secure a scalable and sustainable IT environment for smart building solutions. The new platform is optimised for collection, processing, analysis, and visualisation of data and enables NPTIS to offer a range of end-to-end smart building solutions as a service to its customers. An inhouse platform creates independency and flexibility for NPTIS and secure, reliable, and efficient IoT services for customers and users. In a next step the platform will be used for all Talkpool’s IoT solutions worldwide

4th Quarter 2021

The shareholders in Talkpool AB agreed to accept an offer from Nordic PropTech Investment Services AB (NPTIS) to acquire 100% of the shares in Talkpool AB. The shares were paid with newly emitted NPTIS shares.

Talkpool AG, the mother company of the international technology group Talkpool and majority owner of both Talkpool AB and NPTIS, will hold 51,9% of the new Swedish IoT company specialized in Smart Buildings. 48,1% is held by Talkpool’s current co-owner Sacculus, together with the existing shareholders in Talkpool AB.

On October 19 Home Solutions signed an important Smart Buildings agreement with a large Housing Association (BRF) west of Stockholm regarding the upgrade of their engine heater solution. The order value is around 4 MSEK. Home Solutions will upgrade the existing engine heater system including individual metering and billing function and with local connectivity through wireless M-Bus. The contract includes delivery of components, installation, local connectivity through wireless M-Bus, configuration of individual metering and billing and service agreement for around 400 engine heaters.

The 5G and fibre network projects in the US is creating a high demand for network expertise and services and Talkpool has received new client requests for services on the US mainland and in the Caribbean. To meet the client requests, Talkpool has acquired 100% of the shares in dormant US Talkpool LLC and started hiring staff. The potential of the US market is massive and Talkpool expects this market to become one of its most important in the future, next to Europe.

In addition to the significant demand for 5G services, the IoT market is booming in the US and Talkpool has received several requests for IoT products and solutions. Discussions about potential channel sales on the US market through existing partners are ongoing. US clients require certain adaptions of selected Talkpool IoT products to the US standard, and this modification and certification is already in progress.

During Corona schools have been particularly hard hit by infections. Indoor air control and cleaning systems can help contain the pandemic and allow for safe teachings in classrooms. Most schools have either traditional air conditioners or no air ventilation at all. Talkpool is now testing a fully automatic system that completely exchanges and filters the air in a classroom so that a healthy indoor environment is always guaranteed while heating costs are reduced.

The so called air4schools solution brings clean air into classrooms while reducing CO2 levels and improving sustainability footprint. The solution is currently installed at two schools in Leipzig, Germany and further deployments are planned. While initially focusing on schools, the technology can also improve air quality in offices, conference rooms, public buildings, and private homes.

For more information, please contact:

Erik Strömstedt, CEO Talkpool
Tel: +41 81 250 2020
erik.stromstedt@talkpool.com 

Talkpool provides IoT solutions and telecommunication network services globally. Through its cutting-edge technical expertise, long experience and agile business model, Talkpool offers global telecom vendors and operators high-quality services on short notice no matter the location. Talkpool offers end-to-end IoT solutions for smart buildings and cities with focus on environmental control, energy saving and damage prevention. Erik Penser Bank, +46 8 463 80 00, www.penser.se, is Talkpool's Certified Advisor. For more information www.talkpool.com

This information is inside information that Talkpool AG (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 person set out above, at 08.30 CET on November 18, 2021.