Capnor Weasel Bidco Oyj, Interim Report January – March 2022

CAPNOR WEASEL BIDCO OYJ

Interim Report

January – March 2022

 

 

 

 

Interim Report for the first quarter of 2022

 

 

KEY FINANCIALS

 

 

Change

 

EUR thousand

Q1 2022

Q1 2021

in %

FY 2021

Revenue

25,716

19,043

35%

102,921

EBITDA

5,368

2,494

115%

22,588

EBITDA margin

21%

13%

 

22%

EBIT

3,083

492

527%

14,382

EBIT margin

12%

3%

 

14%

Operational Cash Flow

3,451

-3,194

-208%

7,339

Operational Cash Flow %

13%

-17%

 

7%

 

 

Management overview of the first quarter

 

Following a strong 2021, iLOQ was able to continue on its growth path in Q1 2022. The Group’s revenue growth was 30% or higher for the seventh consecutive quarter with Q1 2022 revenue growth being 35%.

 

The successful actions to mitigate potential supply-chain disruptions due to the global electronics component shortages continued in Q1 2022. Management successfully continued measures to secure delivery capability and to mitigate possible unforeseen supply-chain disruptions in the first quarter to be able to meet customer demand. These actions continued the trend of higher inventory levels compared to Q1 2021. The company is likely to continue to hold higher than normal inventory levels in the coming quarters to mitigate any possible supply-chain disruption coming from the global component shortage. This increase in working capital had a material negative effect on the Group’s cash situation, but management continues to hold the view that, by strategically prioritizing delivery capability, the Group has been able to continue taking market share in Q1 2022.

 

In addition to the global electronics component shortages, the timing of China's COVID-19 restrictions together with the increased geopolitical risks related to the crisis in Ukraine are having a material impact to global supply chains and thus increases the risks also to iLOQ’s business outlook. iLOQ’s management has taken necessary mitigation actions to the above-mentioned risks to secure its delivery capability.

 

Q1 2022 included multiple significant events for iLOQ: iLOQ introduced a new solution that unlocks smart living – iLOQ HOME – a SaaS product that enables residents to have visibility and control of their keys in a ground-breaking way that has never been seen before in the residential sector. The solution is an extension of the iLOQ S5 digital locking system and iLOQ 5 Series platform. By removing the constraints of the traditional lock and key and how they are normally managed, iLOQ HOME has been designed to give residents more freedom, security and flexibility to live the way they want. With the introduction of the iLOQ HOME solution, iLOQ is once again innovating technological and resource-efficient solutions that fulfill society’s requirements for more sustainable, secure and smarter living environments.
 

iLOQ received silver ranking from Ecovadis – the world’s largest and most trusted provider of business sustainability ratings. Their assessment methodology is built on international sustainability standards, including the Global Reporting Initiative, the United Nations Global Compact, and ISO 26000. The silver ranking was given after evaluation of how well iLOQ has integrated environmental practices, labor and human rights, ethics and sustainable procurement into their business and management system.

 

Erja Sankari was appointed as Executive Vice President and Chief Operating Officer on 1st February, 2022. Erja will also become a member of iLOQ’s Management Team. Before joining iLOQ, Sankari has been working as Vice President of Global Supply Chain at Nokia. She replaces Esa Myllylä who will be retiring in 2022. Erja will be responsible for the comprehensive management and development of iLOQ’s global operations, internal practices and way of working and driving forward management systems.

 

 

 

First quarter 2022

 

Despite the strong final quarter Q4 2021, the quarter-to-quarter growth stayed on a high level with the revenue growth being 35% compared to Q1 2021, driven by strong sales across all regions and segments. In addition to iLOQs strong product offering, the strong revenue and delivery performance can be partly credited to the management’s decision to strategically increase short-term inventory levels to mitigate any possible supply-chain disruptions and therefore be able to gain market share due to high delivery capability.

 

EBITDA amounted to MEUR 5.4 (2.5), corresponding to a 21% (13%) EBITDA margin. The increase in EBITDA was mainly caused by the increased volumes and related operational leverage.

 

EBIT amounted to MEUR 3.1 (0.5), corresponding to a 12% (3%) EBIT margin. The increase in EBIT was mainly caused by the increased volumes and related operational leverage.

 

Operational cash flow was MEUR 3.5 (-3.2). The increase was mainly driven by the increased profitability and year-end 2021 having higher receivables due to the strong revenue performance. The increased inventories to mitigate any possible supply-chain disruptions continued to have a material negative impact on the Q1 2022 Operational Cash Flow. The company is expected to continue to have higher than normal inventories until the global component situation improves to guarantee its ability to produce and ship iLOQ products to customers. 

 

 

Quarterly Information

 

 

QUARTERLY INFORMATION

Q1 2020

Q2 2020

Q3 2020

Q4 2020

Q1 2021

Q2 2021

Q3 2021

Q4 2021

Q1 2022

Revenue

14,040

15,234

16,412

28,440

19,043

23,172

21,282

39,424

25,716

EBITDA

-116

1,437

3,669

7,644

2,494

4,291

3,986

11,818

5,368

EBITDA margin

-1%

9%

22%

27%

13%

19%

19%

30%

21%

EBIT

-1,991

-537

2,011

5,606

492

2,230

1,902

9,758

3,083

EBIT margin

-14%

-4%

12%

20%

3%

10%

9%

25%

12%

Operational Cash Flow

693

387

1,509

5,428

-3,194

1,277

-859

10,114

3,451

Operational Cash Flow %

5%

3%

9%

19%

-17%

6%

-4%

26%

13%

Adjusted EBITDA

1,123

1,437

3,669

7,644

2,494

4,291

3,986

11,818

5,368

Adjusted EBITDA margin

8%

9%

22%

27%

13%

19%

19%

30%

21%

 

* Q1 2020 EBITDA, EBIT & Operational Cash Flow include an impact from goodwill bridge calculation in which there is an inventory fair value adjustment of MEUR -1.2. This adjustment was done in connection with Nordic Capital Fund IX’s acquisition of iLOQ and is an NRI. This impact has been eliminated in the Adjusted EBITDA

 

 

 

 

Declaration of the Board

 

We confirm that, to the best of our knowledge, the condensed financial statements give a true and fair view of the Group’s assets, liabilities, financial position and results of operations for the period. We also confirm, to the best of our knowledge, that the management overview includes a fair review of important events that have occurred during the first three months of 2022.

 

 

 

 

Espoo May 10, 2022

 

 

 

 

 

                                                     Heikki Hiltunen                                             Karl Petersson

                                                  President and CEO                                         Member of the Board

INCOME STATEMENT

CONSOLIDATED INCOME STATEMENT, IFRS

 

 

 

EUR Thousand

Q1 2022

Q1 2021

FY 2021

 

 

 

 

Revenue

25,716

19,043

102,921

Other income

0

0

0

 

 

 

 

Materials and services

-11,134

-8,580

-44,459

Employee benefit expenses

-6,057

-4,928

-22,072

Depreciation, amortization and impairment losses

-2,285

-2,002

-8,207

Other operating expenses

-3,157

-3,041

-13,802

Operating profit

3,083

492

14,382

 

 

 

 

Finance income

4

21

73

Finance cost

-1,073

-925

-3,947

Net financial expenses

-1,069

-905

-3,874

 

 

 

 

Profit (loss) before taxes

2,014

-413

10,507

 

 

 

 

Income taxes

-564

45

-2,014

 

 

 

 

Profit (loss) for the financial period

1,449

-368

8,493

 

 

 

 

Items that may be subsequently reclassified to profit or loss

 

 

 

Translation differences

-3

-16

-19

 

 

 

 

Total comprehensive income

1,446

-384

8,474

 

 

 

 

 

 

 

BALANCE SHEET

 

CONSOLIDATED BALANCE SHEET, IFRS

 

 

 

EUR Thousand

Mar 2022

Mar 2021

Dec 2021

 

 

 

 

ASSETS

 

 

 

Non-current assets

 

 

 

Intangible assets

101,012

102,185

101,313

Business value

91,672

91,672

91,672

Property, plant and equipment

6,323

4,849

4,983

Deferred tax assets

496

475

494

Total non-current assets

199,503

199,181

198,461

 

 

 

 

 

 

 

 

Inventories

20,463

12,234

19,804

Trade and other receivables

13,338

13,322

16,826

Cash and cash equivalents

7,735

1,974

7,536

Total current assets

41,536

27,529

44,165

 

 

 

 

Total assets

241,039

226,711

242,626

 

 

 

 

EQUITY & LIABILITIES

 

 

 

Equity

 

 

 

Share capital

80

80

80

Invested unrestricted equity fund

143,240

142,980

143,240

Translation difference

-2

31

-5

Retained earnings

5,397

-4,952

3,949

Total equity

148,716

138,139

147,264

 

 

 

 

LIABILITIES

 

 

 

Non-current liabilities

 

 

 

Financial liabilities

54,447

54,263

54,400

Non-current lease liabilities

1,582

920

680

Non-current provisions

658

1,080

807

Deferred tax liabilities

17,712

18,451

17,919

Total non-current liabilities

74,400

74,714

73,805

 

 

 

 

Current liabilities

 

 

 

Short-term interest-bearing liabilities

0

0

0

Account payables and other liabilities

15,113

12,241

18,132

Current lease liabilities

1,379

1,057

933

Current provisions

1,036

521

1,009

Current tax liabilities

396

38

1,484

Total current liabilities

17,923

13,857

21,557

 

 

 

 

Total liabilities

92,323

88,571

95,362

 

 

 

 

Total equity and liabilities

241,039

226,711

242,626

STATEMENT OF CASH FLOWS

CONSOLIDATED STATEMENT OF CASH FLOWS, IFRS

 

 

 

EUR Thousand

Q1 2022

Q1 2021

FY 2021

 

 

 

 

 

 

 

 

CASH FLOW FROM OPERATING ACTIVITIES

 

 

 

Profit (Loss) for the financial period

1,449

-368

8,493

Adjustments:

 

 

 

Depreciation and amortization

2,285

2,002

8,207

Unrealized exchange rate gains and losses

0

0

9

Financial Income

-4

-21

-73

Financial Expense

1,073

925

3,947

Taxes

564

-45

2,014

Other adjustments

0

0

0

Change in Working Capital:

 

 

 

Change in trade and other receivables

3,569

-1,172

-4,651

Change in inventory

-660

-1,987

-9,557

Change in trade and other payables

-3,017

-1,267

4,528

Change in provisions

-122

116

330

Interest paid

-750

-737

-3,181

Interest received

0

0

12

Income tax paid

-1,864

-1,750

-2,868

Other financial items

-52

-47

-200

Net cash flow from operating activities (A)

2,473

-4,353

7,012

 

 

 

 

Cash flow from investing activities

 

 

 

Investments in intangible assets

-1,401

-1,059

-4,406

Investments in tangible assets

-286

-318

-1,495

Business acquisitions

0

0

0

Net cash flow from investing activities (B)

-1,688

-1,377

-5,900

 

 

 

 

Cash flow from financing activities

 

 

 

Common control merger

0

0

6

Payments of lease liabilities

-401

-262

-1,204

Proceeds from short-term liabilities

0

0

0

Payments of short-term liabilities

0

0

0

Net cash flow from financing activities (C)

-401

-262

-1,198

 

 

 

 

CHANGE IN CASH AND EQUIVALENTS (A+B+C)

384

-5,992

-87

 

 

 

 

Cash and cash equivalents, in the beginning of period

7,536

8,013

8,013

Net effect of exchange rate changes on cash and cash equivalents

-186

-47

-391

Cash and cash equivalents, at the end of period

7,735

1,974

7,536

Definitions of alternative performance measures

 

  1. EBITDA = EBIT before depreciation, amortization and impairments

 

  1. Operational Cash Flow = EBITDA + Change in trade and other receivables + Change in inventory + Change in trade and other payables + Change in provisions + Net cash flow from investing activities (C). Operational cash flow is used internally by the group to follow EBITDA which takes into account investments and change in working capital

 

  1. Operational Cash Flow % = Operational Cash Flow / Revenue

 

  1. Adjusted EBITDA = EBITDA excluding items affecting comparability

 

 

 

 

 

 

 

 

 

 

 

CONTACT

 

Additional information about the company can be found on the corporate website www.iloq.com. The company can be contacted by e-mail, vasb@vybd.pbz.

 

For questions concerning this report please contact:

 

Heikki Hiltunen

CEO and President

urvxxv.uvyghara@vybd.pbz

 

Timo Pirskanen

CFO

gvzb.cvefxnara@vybd.pbz