NFON (NFN) Q4 2023 earnings summary

Executive summary

• FY2023 revenue rose 1.9% to €82.3m; recurring revenue grew 4.8% to €77.1m, reaching 93.7% of total. Adjusted EBITDA improved to €8.4m from -€1.0m, with positive operating cash flow and first positive free cash flow since listing.

• The strategy shifted further toward sustainable profitable growth, with organisational, product and cost-base transformation supporting growth across integrated cloud communications.

Financial highlights

• Gross profit increased 4.5% to €69.4m; EBITDA was €6.8m versus -€5.3m, and EBIT improved to -€0.5m from -€12.0m.

• Net loss narrowed to €0.8m from €15.6m; basic and diluted loss per share were both €0.05 versus €0.94 in 2022.

• Non-recurring revenue fell 27.8% to €5.2m, mainly reflecting lower hardware sales; recurring revenue rose 4.8% to €77.1m.

• Adjusted EBITDA of €8.4m included €1.6m of non-recurring effects; excluding those effects, adjusted staff costs were €33.7m and other operating expenses €28.2m.

Outlook and guidance

• FY2024 recurring-revenue growth is forecast in the mid-to-upper single-digit range, recurring revenue share at least 90%, and adjusted EBITDA €10m–€12m.

• Cost-base and efficiency measures, product development, sales excellence and partnerships are expected to drive moderately higher revenue growth and improve operating earnings and free cash flow.

• The parent-company outlook is low-to-mid single-digit growth in total and recurring revenue; the planned merger is expected to contribute €17.5m–€18m of revenue.