StrongPoint (STRO) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue increased 7% year-over-year, reaching up to MNOK 359, driven by strong growth in the Baltics, Finland, Sweden, and e-commerce, despite significant declines in UK & Ireland shopfitting.

• E-commerce revenue surged 176%, with recurring revenue up 10% and software license recurring revenue up 33%, mainly from the Sainsbury's Order Picking rollout.

• EBITDA improved, reaching up to 12.2 MNOK, with margins close to 4%, reflecting cost reductions and operational improvements.

• EPS for Q3 2024 ranged from NOK 0.06 to NOK -0.41, with sequential improvement over previous quarters.

• Strong customer momentum with new deployments and rollouts, including Sainsbury's, Maxima, and Delivereasy.

Financial highlights

• Revenue growth in the Baltics and Finland reached 36% year-over-year; Sweden saw a 25% increase, while UK & Ireland shopfitting revenue declined by up to 51%.

• Recurring revenue for the last 12 months rose 10%, fueled by a 33% increase in license revenue.

• Cash position at quarter-end ranged from NOK 34 million to 61 million, with disposable funds at 60.9 MNOK.

• Net interest-bearing debt at end Q3 2024 ranged from MNOK 77 to 109.3 MNOK.

• EBITDA margin improved to nearly 4%.

Outlook and guidance

• Sainsbury's Order Picking rollout progressing, with plans to reach nearly 300 stores by H1 2025.

• CashGuard Connect product development nearing completion, with industrial rollout targeted for Q4 2025.

• The company maintains long-term ambitions for healthy revenue growth and EBITDA margin above 10%.

• Market uncertainty persists, but positive trends are emerging, especially in automation and e-commerce.