Enea : Interim Report January-September 2022

October 26, 2022Regulatory Information

Enea Interim Report January-September 2022

Third Quarter

• Net gross sales amounted to SEK 229.3 million (229.5), which was flat in comparison with identical interval earlier yr. Net gross sales decreased by 8 % in fastened trade charges.

• Adjusted EBITDA amounted to SEK 85.4 million (91.6), comparable to a margin of 37.3 % (39.9).

• Operating revenue was SEK 41.0 million (42.9), comparable to an working margin of 17.9 % (18.7).

• Net revenue after tax amounted to SEK 36.6 million (45.6).

• Earnings per share had been SEK 2.42 (2.33).

• Earnings per share continued operations had been SEK 1.69 (2.11).

The interval January – September

• Net gross sales amounted to SEK 656.7 million (610.9), equal to a 7 % enhance. Net gross sales elevated by 1 % in fastened trade charges.

• Adjusted EBITDA amounted to SEK 212.3 million (248.3), comparable to a margin of 32.3 % (40.6).

• Operating revenue was SEK 60.3 million (140.3), comparable to an working margin of 9.2 % (23.0).

• Net revenue after tax amounted to SEK 69.8 million (133.0).

• Earnings per share had been SEK 8.61 (6.76).

• Earnings per share continued operations had been SEK 3.24 (6.17).

Significant Events During and After the End of the Quarter

• On August 12, Enea introduced a three-year enlargement settlement for cellular messaging safety with a North American Communication Platform-as-a-Service (CPaaS) supplier. Software licenses value USD 1.8 million are acknowledged within the third quarter of 2022, whereas remaining revenues might be acknowledged over the complete contract interval. The complete deal worth is USD 5.9 million.

• On September 30, Enea introduced a contract for 5G visitors administration with a North American cellular community operator. The resolution is predicated on Enea´s new 5G Service Engine (5G-SE), which was launched to the market in July. Software licenses comparable to a worth of CAD 3.3 million are acknowledged within the third quarter of 2022, whereas remaining components of the settlement are delivered through the subsequent three years. The complete contract worth is CAD 4.4 million.

CEO’s Statement

New offers in cybersecurity, visitors administration and 5G, plus a rise in recurring revenues, contributed to greater web gross sales and working revenue than earlier quarters this yr.

The third quarter 2022 was clearly higher than earlier quarters this yr, with greater web gross sales, an improved working margin, elevated working revenue and powerful money stream from operations. Network Solutions achieved natural development of 4 %, because of new license offers and elevated recurring revenues. We’re now clearly seeing our 5G investments repay, this time with a significant deal in North America. Further, our new enterprise unit, AdaptiveMobile Security, is constant to win cybersecurity contracts. Net gross sales within the quarter had been SEK 229 million, and our working revenue was SEK 41 million, equal to an working margin of 18 %. Currency results had a optimistic affect on revenue, largely resulting from a excessive income share in USD. Cash stream from working actions was SEK 92 million, and our earnings per share (EPS) had been SEK 2.42, together with SEK 0.73 from our Services enterprise, which was divested earlier within the yr.

Customers in North America are nonetheless prioritizing and investing in safety, rollouts of 5G, the adoption of latest cloud platforms and community efficiency enhancements. We have enterprise relationships with lots of the largest community operators in Canada, Mexico, and the USA, and are consolidating our gross sales sources on this area. We have good potential for extra cross gross sales of our product portfolio, i.e., gross sales of latest merchandise via established account relationships and underneath present framework agreements. In different areas, we’re seeing the market being slowed by a worsening macroeconomic state of affairs with greater inflation, rising rates of interest and elevated power costs. In flip, that is inflicting deferrals of main investments, such because the build-out of 5G core networks.

Telecom community safety stays a significant problem for public authorities and repair suppliers. In August, we received a contract at a significant North American CPaaS supplier (communication platform as a service), securing our market main standing in messaging safety, and serving to the continued progress of our enterprise unit AdaptiveMobile Security. American cellular operators and repair suppliers use our software program and experience to stop 40-50 million fraud makes an attempt daily via malicious and undesirable textual content messages. Total visitors quantity is growing, and because of sturdy positioning available on the market, we see the potential to develop our world gross sales in messaging safety.

Enea launched the service platform 5G Service Engine (5G-SE) in July-a new resolution, and the market’s first to assist visitors administration and video optimization of each 4G and 5G visitors. As early as September, we signed our first contract with a North American cellular operator, who will deploy this product to reinforce QoS for subscribers, enhance the info velocity of cellular visitors and scale back radio community loading. This deal is a significant enhance to our license income, and means our enterprise relationship with this key buyer is increasing. Traffic administration is a part of Network Solutions, that made gradual progress in latest quarters resulting from venture delays and a diminished willingness to speculate. However, elevated working bills in cellular networks could current new enterprise alternatives, as a result of video visitors optimization helps scale back power consumption in telecom operator datacenters and radio gear.

Outlook

The marketplace for knowledge administration in 5G and superior cybersecurity is in an early section, the place we are able to problem established opponents and win market shares with progressive merchandise and new enterprise fashions. Our ambition is to extend revenues briskly, whereas sustaining good profitability, via natural development in Network Solutions plus complementary strategic acquisitions that advance our market positioning.

Individual offers and licensing revenues could trigger variations in revenues between particular person quarters. This impact has elevated as Network Solutions symbolize a bigger share of our complete web gross sales. Our long-term goal of gross sales development and an working revenue above 20 % stays, however an unsure macro surroundings and a weak begin to the yr signifies that we choose it difficult to achieve our profitability goal for 2022.

The full Interim Report is hooked up to this press launch and has been printed on the Enea web site (see references beneath).

Presentation

Enea is happy to ask buyers, analysts, and media to a presentation of the Interim Report. The presentation might be performed in English by Jan Häglund, President and Chief Executive Officer, and Ola Burmark, Chief Financial Officer, and might be concluded by a questions and reply session. It will be attended via a webcast or convention name and the presentation materials in addition to a recording of the presentation might be printed on the Enea web site (see particulars and references beneath).

Details

References

Contact

Ola Burmark, Chief Financial Officer

Phone: +46 8 507 140 00
E-mail:[email protected]

About Enea

Enea is a world-leading specialist in software program for telecom and cybersecurity. The firm’s cloud-native options join, optimize, and safe providers for cellular subscribers, enterprises, and the Internet of Things. More than 100 communication service suppliers and 4.5 billion individuals depend on Enea applied sciences daily.

Enea has strengthened its product portfolio and world market place by integrating numerous acquisitions, together with Qosmos, Openwave Mobility, Aptilo Networks, and AdaptiveMobile Security.

Enea is headquartered in Stockholm, Sweden, and is listed on Nasdaq Stockholm.

For extra info:www.enea.com

Enea is required to make the knowledge on this press launch public pursuant to the EU Market Abuse Regulation. The info was submitted for publication, via the company of the contact individuals set out above, at 7:20 a.m. on October 26, 2022.

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