Talenom Plc’s Financial Statement Bulletin 2021: Growth accelerated and profitability remained excellent as the internationalisation strategy progressed
Talenom Plc, stock exchange release, 8 February 2022 at 9:00 EET
TALENOM PLC’S FINANCIAL STATEMENT BULLETIN 2021: GROWTH ACCELERATED AND PROFITABILITY REMAINED EXCELLENT AS THE INTERNATIONALISATION STRATEGY PROGRESSED
JANUARY–DECEMBER 2021 IN BRIEF
- Net sales EUR 82.8 million (65.2), growth 27.1% (12.4)
- EBITDA EUR 27.7 million (23.3), 33.4% (35.7) of net sales
- Operating profit (EBIT) EUR 14.8 million (12.9), 17.8% (19.8) of net sales
- Net profit EUR 10.8 million (9.6)
- Earnings per share EUR 0.25 (0.22)
- Board of Directors’ dividend proposal EUR 0.17 (0.15) per share
OCTOBER–DECEMBER 2021 IN BRIEF
- Net sales EUR 21.8 million (16.5), growth 32.2% (10.4)
- EBITDA EUR 6.6 million (5.0), 30.4% (30.7) of net sales
- Operating profit (EBIT) EUR 2.8 million (2.4), 12.8% (14.7) of net sales
- Net profit EUR 1.9 million (1.8)
- Earnings per share EUR 0.04 (0.04)
GUIDANCE FOR 2022 UNCHANGED (PUBLISHED 16 DECEMBER 2021)
Talenom expects 2022 net sales to be EUR 100–110 million and operating profit (EBIT) to be EUR 15–18 million.
KEY FIGURES
| Group | 1–12/2021 | 1–12/2020 | Change, % | 10–12/2021 | 10–12/2020 | Change, % |
| Net sales, EUR 1,000 | 82,808 | 65,161 | 27.1% | 21,756 | 16,463 | 32.2% |
| Net sales, increase % | 27.1% | 12.4% | 32.2% | 10.4% | ||
| EBITDA, EUR 1,000 | 27,662 | 23,279 | 18.8% | 6,608 | 5,048 | 30.9% |
| EBITDA of net sales, % | 33.4% | 35.7% | 30.4% | 30.7% | ||
| Operating profit (EBIT), EUR 1,000 | 14,763 | 12,881 | 14.6% | 2,791 | 2,425 | 15.1% |
| Operating profit (EBIT), as % of net sales | 17.8% | 19.8% | 12.8% | 14.7% | ||
| Return on investment (ROI), % (rolling 12 months) | 17.7% | 19.6% | 17.7% | 19.6% | ||
| Cash flow from operations, EUR 1,000 | 25,582 | 23,436 | 9.2% | |||
| Interest-bearing net liabilities, EUR 1,000 | 39,240 | 29,328 | 33.8% | |||
| Net gearing ratio, % | 88.0% | 91.0% | ||||
| Equity ratio, % | 38.1% | 38.1% | ||||
| Net investments, EUR 1,000 | 37,957 | 20,295 | 87.0% | 13,670 | 4,751 | 187.7% |
| Liquid assets, EUR 1,000 | 10,121 | 9,104 | 11.2% | 10,121 | 9,104 | 11.2% |
| Earnings per share, EUR | 0.25 | 0.22 | 10.5% | 0.04 | 0.04 | |
| Weighted average number of shares during the period | 43,462,583 | 42,654,214 | 1.9% | 43,639,652 | 42,645,587 | 2.2% |
| Net profit, EUR 1,000 | 10,794 | 9,579 | 12.7% | 1,877 | 1,803 | 4.1% |
CEO OTTO-PEKKA HUHTALA
2021 will be remembered for the uncertainty caused by COVID. In the end, the year was mainly positive in terms of economic growth, both in the general economy and for us at Talenom. We expanded our operations to Spain and continued implementing our internationalisation strategy. We have seen a digital transformation of the accounting services industry similar to Finland, which we have invested in for a few years, taking place in other parts of Europe as well.
The Group’s net sales grew by 27.1% last year to EUR 82.8 million accelerating toward the end of the year. In addition to strong organic growth, it was based increasingly on acquisitions. The EBITDA margin was 33.4% (35.7) and the EBIT margin 17.8% (19.8). Profitability remained excellent despite weaker profitability in the acquired businesses than in other Talenom units, the integration costs of the acquisitions and the increased depreciation level.
Finnish business operations continued excellent development last year. Net sales grew by 17.1% last year to EUR 71.8 million, driven by both organic growth and acquisitions. Organic growth was driven by successful new customer acquisition and sales of value-added services. The EBITDA margin remained at an excellent 37.5% (38.1) level and the EBIT margin was 21.1% (21.8). Automation development had a positive and acquisition targets a negative short-term effect on relative profitability.
Swedish net sales increased by 177.5% to EUR 10.7 million mainly due to acquisitions. EBITDA was 7.1% (-1.6) of net sales and EBIT was -3.0% (-12.6) of net sales. During 2021, we built a Swedish country organisation, which enables accelerated growth and implementation of own software. New customer acquisition kicked-off well in the autumn, and we expect the same development to continue this year. Profitability is moving in the right direction, and we expect faster development when we can start moving customers to our platform in autumn 2022.
The strong operating cash flow has enabled significant investments in software and acquisitions, as well as continuous improvement of operations. We have updated our customer interfaces and software architecture. Our experience shows that the financial management needs of SMEs are similar, which has enabled us to focus on building a single platform for international scalability and thus faster implementation in new countries. In the small customer segment, the introduction of payment accounts and cards and the launch of digital sales are noteworthy. In the service business, we received praise from our customers for our journey from an accountant to a consultant. Customer satisfaction with our service in Finland reached record-high levels (Q4/2021 NPS 65 vs. Q4/2020 NPS 51).
Talenom reached the age of fifty at the turn of the year and the first history of the company called The Story of Talenom was completed. When reading the book, Talenom’s values take centre stage: Courage, Will and Caring. We are proud and grateful for the roots of Talenom to its founders. These roots still carry us today.
We enter the new year with a positive outlook. We reorganised our Executive Board in January 2022 to better respond to the development phase of our company, where profitable growth and internationalisation play a key role. In addition to growth, the focus areas for the year are further development of services in Finland, investigating new market areas, scaling of the small customer business and implementation of systems in Sweden. We expect 2022 net sales to be around EUR 100–110 million and EBIT of some EUR 15–18 million.
I would like to thank our customers their confidence in us, our excellent personnel for their commitment and our partners for good cooperation in the past year.
BOARD OF DIRECTORS’ PROPOSAL FOR THE TREATMENT OF PROFIT
The Board of Directors proposes that the parent company’s profit for the period of EUR 10,514,330.71 to be transferred to the Profit/Loss Account for the previous financial years. The Board of Directors proposes that a dividend of EUR 0.17 per share be paid.
WEBCAST
The company’s CEO Otto-Pekka Huhtala will present the main points of the review in a live webcast today Tuesday 8 February 2022 at 10:00 EET. The live webcast will be in Finnish, but a recording of the event will be published also in English on Talenom’s website https://sijoittajat.talenom.fi/en
The live webcast event can be viewed at: https://talenom.videosync.fi/tilinpaatos-2021
Participants will have the opportunity to present questions during the briefing over the webcast platform. Due to the Covid-19 situation, the event is completely virtual.
The presentation materials will be published before the start of the briefing on the company’s website.
TALENOM PLC
BOARD OF DIRECTORS
Further information:
Otto-Pekka Huhtala
CEO, Talenom Plc
+358 40 703 8554
otto-pekka.huhtala@talenom.fi
Talenom is an agile and progressive accounting firm established in 1972. Our business idea is to make daily life easier for entrepreneurs with the easiest-to-use digital tools on the market and highly automated services. In addition to comprehensive accounting services, we support our customers’ business with a wide range of expert services, as well as financing, account and payment traffic services. Our vision is to provide superior accounting, account and payment traffic services for SMEs.
Talenom’s growth history is strong – average annual net sales growth was approximately 16.2% between 2005 and 2021. In 2021, Talenom had on average 1,012 employees in Finland, Sweden and Spain at a total of 52 locations. Talenom’s share is quoted on the Main Market of Nasdaq Helsinki. Read more: sijoittajat.talenom.fi/en/
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