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Capnor Weasel Bidco Oyj, Interim Report January – March 2023

Interim Report for the first quarter of 2023

 

      Change  
EUR thousand Q1 2023 Q1 2022 in % FY 2022
Revenue 32,000 25,716 24 % 132,948
EBITDA 6,060 5,368 13 % 31,378
EBITDA margin 19 % 21 % 24 %
EBIT 3,542 3,083 15 % 21,854
EBIT margin 11 % 12 % 16 %
Operational Cash Flow 7,753 3,451 125 % 18,160
Operational Cash Flow % 24 % 13 % 14 %
Adjusted EBITDA* 6,438 5,368 20 % 31,866
Adjusted EBITDA margin* 20 % 21 %   24 %
Adjusted EBIT 3,920 3,083 27 % 22,342
Adjusted EBIT margin 12 % 12 % 17 %
Adjusted Operational Cash Flow 8,131 3,451 136 % 18,648
Adjusted Operational Cash Flow % 25 % 13 % 14 %

 

*  Q1 2023 and year 2022 EBITDA, EBIT & Operational Cash Flow included an impact from a brand renewal project and a market study conducted with external companies, which have been treated as items affecting comparability. The adjustment related to brand renewal in Q1 2023 was 378 thousand euros and in FY 2022 market study 488 thousand euros. These costs have been excluded in the Adjusted EBITDA, EBIT and Operational Cash Flow figures above.

 

Management overview of the first quarter

iLOQ Group’s healthy performance continued also in the first quarter of the year 2023. Revenue growth was 24% compared to the same period in the previous year, despite slightly lower activity in the Nordic built environment market. The strong performance continued across all other regions and segments.

iLOQ continued to successfully mitigate supply-chain disruptions in the market to be able to meet customer demand. These mitigating actions continued the trend of materially higher inventory levels compared to the same period in the previous year. The company is still 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 materials and electronic components shortage. However, there are first signs of improving availability of materials and electronic components and the company continues to follow the global trends closely. Increase in working capital had a material negative effect on the Group’s cash situation despite the normal seasonal cash inflow in the first quarter.

Prevailing geopolitical risks related to Russia’s invasion of Ukraine and the resulting rise in energy prices, together with an increasing interest rate environment have had a negative impact on the real estate sector. Especially the new construction market has been affected, which constitutes only a small part of iLOQ’s revenue base. However, some postponement in decision making in the renovation market has also affected overall demand in the first quarter. Management believes that iLOQ is well positioned to continue to outgrow the market also during periods of softer market activity.

First quarter of 2021 included multiple significant events for iLOQ:

iLOQ signed a global Master Supply Agreement with Honeywell, a global supplier of industry specific solutions in March 2023. Honeywell Building Technologies operates in more than 75 countries and is supported by a global channel partner network. Its solutions and services are used in more than 10 million buildings worldwide. Commercial building owners and operators are dealing with Honeywell Building Technologies to create safe, efficient, and productive facilities.

iLOQ established its US presence by showcasing its battery-free smart locks and keyless cellphone-based solutions at the ISC West Trade show in Las Vegas in March 2023.

iLOQ announced in March 2023 that the Swedish real estate company Neobo had chosen iLOQ as a partner for long-term cooperation. Neobo’s ambition is to install iLOQ’s S5 system in most of its properties, giving tenants in over 8,000 apartments increased security and more control over their accommodation.

After the review period on 1 April 2023, iLOQ welcomed employee number 300 to its fast-growing team. This is another milestone in a year of milestones as, this year, iLOQ will also be celebrating its 20th anniversary.

 

First quarter 2023

 Total revenue grew 24% compared to Q1 2022. Good performance continued across all regions and segments, but with some initial signs of slightly slower activity in the Nordic built environment sector.

EBITDA amounted to MEUR 6.1 (5.4), corresponding to a 19% (21%) EBITDA margin. The increase in EBITDA was mainly driven by the increased volumes and related operational gearing.

EBIT amounted to MEUR 3.5 (3.1), corresponding to a 11% (12%) EBIT margin.

Operational Cash Flow was MEUR 7.8 (3.5). The strategic decision to continue operating with higher inventories to mitigate any possible global materials and electronic components shortage continued to have a material negative impact on the Operational Cash Flow in the first quarter of 2023. The company is expected to continue having higher than normal inventories until the risks related to possible unforeseen supply-chain disruptions clear away to guarantee its ability to produce and ship iLOQ products to customers.

 

Quarterly Information

 

QUARTERLY INFORMATION Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023
Revenue 19,043 23,172 21,282 39,424 25,716 28,790 27,439 51,003 32,000
EBITDA 2,494 4,291 3,986 11,818 5,368 4,684 4,701 16,625 6,060
EBITDA margin 13 % 19 % 19 % 30 % 21 % 16 % 17 % 33 % 19 %
EBIT 492 2,230 1,902 9,758 3,083 2,405 2,414 13,952 3,542
EBIT margin 3 % 10 % 9 % 25 % 12 % 8 % 9 % 27 % 11 %
Operational Cash Flow -3,194 1,277 -859 10,114 3,451 442 -2,358 16,625 7,753
Operational Cash Flow % -17 % 6 % -4 % 26 % 13 % 2 % -9 % 33 % 24 %
Adjusted EBITDA 2,494 4,291 3,986 11,818 5,368 5,172 4,701 16,625 6,438
Adjusted EBITDA margin 13 % 19 % 19 % 30 % 21 % 18 % 17 % 33 % 20 %

 

 

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 2023.

 

Espoo May 14, 2023

 

Heikki Hiltunen                                             Karl Petersson

President and CEO                                        Member of the Board

 

INCOME STATEMENT

 

CONSOLIDATED INCOME STATEMENT, IFRS      
EUR Thousand Q1 2023 Q1 2022 FY 2022
Revenue 32,000 25,716 132,948
Other income 0 0 0
Materials and services -13,171 -11,134 -56,846
Employee benefit expenses -7,547 -6,057 -26,191
Depreciation, amortisation and impairment losses -2,518 -2,285 -9,525
Other operating expenses -5,221 -3,157 -18,533
Operating profit 3,542 3,083 21,853
Finance income 80 4 122
Finance cost -1,434 -1,073 -4,599
Net financial expenses -1,354 -1,069 -4,477
Profit (-loss) before taxes 2,188 2,014 17,376
Income taxes -479 -564 -3,648
Profit (loss) for the financial period 1,709 1,449 13,728
 
Items that may be subsequently reclassified to profit or loss
Translation differences 9 -3 12
Total comprehensive income 1,718 1,446 13,740

 

BALANCE SHEET

 

CONSOLIDATED BALANCE SHEET, IFRS
EUR Thousand Mar 2023 Mar 2022 Dec 2022
ASSETS
Non-current assets
Intangible assets 104,071 101,012 102,774
Goodwill 92,412 91,672 92,412
Property, plant and equipment 7,083 6,323 7,334
Deferred tax assets 427 496 447
Total non-current assets 203,994 199,503 202,967
Inventories 30,100 20,463 26,117
Trade and other receivables 17,115 13,338 30,073
Cash and cash equivalents 7,847 7,735 4,087
Total current assets 55,062 41,536 60,277
Total assets 259,056 241,039 263,244
       
EQUITY & LIABILITIES
Equity
Share capital 80 80 80
Invested unrestricted equity fund 143,240 143,240 143,240
Translation difference 16 -2 7
Retained earnings 18,534 5,397 17,658
Total equity 161,870 148,716 160,985
LIABILITIES
Non-current liabilities
Financial liabilities 54,888 54,447 54,899
Non-current lease liabilities 1,168 1,582 1,499
Non-current provisions 710 658 574
Deferred tax liabilities 17,027 17,712 17,246
Total non-current liabilities 73,793 74,400 74,219
Current liabilities
Short-term interest-bearing liabilities 62 0 0
Account payables and other liabilities 21,178 15,113 24,185
Current lease liabilities 1,544 1,379 1,559
Current provisions 518 1,036 704
Current tax liabilities 92 396 1,593
Total current liabilities 23,393 17,923 28,040
Total liabilities 97,186 92,323 102,259
Total equity and liabilities 259,056 241,039 263,244

 

 

STATEMENT OF CASH FLOWS

 

CONSOLIDATED STATEMENT OF CASH FLOWS, IFRS
EUR Thousand     Q1 2023 Q1 2022 FY 2022
CASH FLOW FORM OPERATING ACTIVITIES
Profit (Loss) for the financial period 1,709 1,449 13,728
Adjustments:
Depreciation and amortization 2,518 2,285 9,525
Unrealized exchange rate gains and losses 0 0 38
Financial Income -80 -4 -122
Financial Expense 1,434 1,073 4,599
Taxes 479 564 3,648
Other adjustments 0 0 0
Change in Working Capital:
Change in trade and other receivables 13,009 3,569 -13,341
Change in inventory -3,983 -660 -6,303
Change in trade and other payables -3,762 -3,017 6,057
Change in provisions -50 -122 -537
Interest paid -1,045 -750 -3,356
Interest received 0 0 0
Income tax paid -2,291 -1,864 -4,341
Other financial items -38 -52 -294
Net cash flow from operating activities (A)     7,899 2,473 9,302
Cash flow from investing activities
Payments from tangible assets sales 31
Investments in intangible assets -3,134 -1,401 -6,937
Investments in tangible assets -386 -286 -1,750
Business acquisitions 0 0 -1,716
Net cash flow from investing activities (B)     -3,520 -1,688 -10,371
Cash flow from financing activities
Common control merger 0 0 -6
Payments of lease liabilities -449 -401 -1,697
Proceeds from short-term liabilities 0 0 0
Payments of short-tem liabilities 0 0 0
Net cash flow from financing activities (C)     -449 -401 -1,703
CHANGE IN CASH AND EQUIVALENTS (A+B+C)     3,930 384 -2,772
Cash and cash equivalents, in the beginning of period     4,087 7,536 7,536
Net effect of exchange rate changes on cash and cash equivalents -170 -186 -677
Cash and cash equivalents, at the end of period     7,847 7,735 4,087

 

 

 

Definitions of alternative performance measures

 

  1. EBITDA = EBIT before depreciation, amortization and impairments
  2. Operational Cash Flow = EBITDA + Change in trade and other receivables + Change in inventory + Change in trade and other payables + Change in provisions + Investments in intangible assets + Investments and Payments in tangible assets. Operational Cash Flow is used internally by the group to follow EBITDA which takes into account investments and change in working capital
  3. Operational Cash Flow % = Operational Cash Flow / Revenue
  4. Adjusted EBITDA, Adjusted EBIT & Adjusted Operational Cash Flow = Same as above but excluding an impact from a brand renewal project and a market study conducted with external companies, which have been treated as items affecting comparability. The adjustment related to brand renewal in Q1 2023 was 378 thousand euros and in FY 2022 market study 488 thousand euros. These costs have been excluded in the Adjusted EBITDA, EBIT and Operational Cash Flow figures above.

 

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