Enento Group Oyj · OMXHEX:ENENTO
Enento Group Oyj — Q3 2024 Earnings Presentation
48 slides from Enento Group Oyj's earnings presentation, Oct 29, 2024
Slide 1: Enento Group Plc Interim Report 1.1.2024-30.9.2024
CEO Jeanette Jäger and CFO Elina Stråhlman 29 October 2024 Enento Group Plc Interim Report 1.1.2024-30.9.2024
Slide 2: Disclaimer
Disclaimer This presentation includes forward-looking statements. The words “believe,” “expect,” “anticipate,” “intend,” “may,” “plan,” “estimate,” “will,” “should,” “could,” “aim,” “target,” “might,” or, in each case, their negative, or any similar expressions identify certain of these forward-look
Slide 3: We build trust in the everyday
Our Purpose: We build trust in the everyday. We collect and transform data to intelligence and knowledge used in interactions between people, businesses and society.
Slide 4: Enento as an investment
Enento as an investment 1 Nordic presence with strong market position, trusted well-known brands and resilient, scalable business model 2 Attractive markets with strong dynamics 3 Business critical services using proprietary data 4 Diversified client base across all products and services based on st
Slide 5: Enento Group at a glance
ENENTO GROUP 2023 LISTED ON MARKET CAPITALISATION NASDAQ 31 December 2023 Building trust in the everyday. HELSINKI. 464 MEUR In Finland we operate under NET SALES 2023 ADJUSTED EBITDA 2023 the brands Asiakastieto and Emaileri, in Sweden 155,9 57,1 Partners in Europe and MEUR MEUR under UC, Allabolag
Slide 6: Executive Management Team
Executive Management Team Jeanette Jäger Elina Stråhlman Siri Hane Gabriella Göransson Mikko Karemo CEO CFO Director (interim) Director Chief Commercial Business Insight Consumer Insight Officer & Deputy CEO Business Area Business Area Karl-Johan Werner Arto Paukku Sari Ek-Petroff Daniel Ejderberg C
Slide 7: Strong track record of organic growth and M&A execution
Enento has a strong track record of organic growth and M&A execution 1976 2019 1905 The credit 2011 2017 Acquired Proff, an Suomen information Acquired Allabolag Acquired Emaileri, a information services Luotonantajayhdistys company UC in in Sweden 2015 Finnish provider of provider operating is foun
Slide 8: Scale through value-adding, intelligent services built on data
We build scale through value-adding, intelligent services built on data collected from various sources …based on a variety Unique datasets and services… of data sources Company Advanced analytics Banks data ✓ Provides both cyclical and countercyclical products and services Decision scoring Monitorin
Slide 9: Strategic customer relationships, strong local brands set high barriers to entry
Strategic customer relationships, strong local brands, and integrated services set high barriers to entry A reputation built over decades Embedded into critical processes Long-term customer relationships and Our data and value-added services are trust in our local brands with long-standing integrate
Slide 10: Two business areas serving companies and consumers in the Nordics
Two business areas serving more than 76,000 companies and 500,000 consumers in the Nordics 1 Business Insight1 2 Consumer Insight Share of net sales 43% (YTD 2023) 57% Enterprise Solutions, Premium Solutions, Freemium Solutions Consumer Credit Information, Consumer Marketing Information, Real-estate
Slide 11: Stable net sales and improved adjusted EBITDA margin
Net sales and profitability development have been stable during the turbulent years, and adjusted EBITDA margin has improved EUR million Adjusted EBITDA % 180 168 40 164 160 151 156 39 146 134 38 140 36,6% 36,6% 37 36,2% 120 35,7% 36 35,3% 100 35 80 34 60 33 31,3% 32 40 59 61 57 31 52 54 20 42 30 0
Slide 12: Innovation at Enento: New and enhanced services
Innovation at Enento: New and enhanced services driving growth and increasing customer loyalty Investing in future growth Share of new services* from group net sales ✓ Growth in selected strategic growth areas, such as the ESG and compliance, by driving 16,6% innovation and developing new services 1
Slide 13: AI has two main areas of potential application
AI has two main areas of potential application in Enento’s business Applications of AI User interfaces INNOVATIVE SERVICES Service content Data management INTERNAL EFFICIENCY Tooling 13 Building trust in the everyday.
Slide 14: Group Strategy
Group Strategy
Slide 15: Gaining market share in the 600 MEUR addressable market
Growing from Enento’s strong Nordic foothold to gain market share in the 600 MEUR addressable market Sweden and Finland are the largest Nordic ✓ markets, driven by data availability and overall price point Credit, Sales & Marketing and Compliance Nordic market size €600mm Enento is a leading credit
Slide 16: Strategy focused on execution for growth and EBITDA margin expansion
Enento Group strategy is focused on execution to deliver consistent growth and EBITDA margin expansion Strategic goals 2024 -2026 targets Retain and strengthen our leading position in 5-10% average annual net sales growth the credit information business Around 40% Adjusted EBITDA Become the leading
Slide 17: Attractive growth dynamics in the data market
Attractive growth dynamics in the data market driven by the compelling industry trends Market drivers during the strategy period EMEA region data-as-a-service growth >8% p.a. Data and analytics as a service Tightening Global KYC and AML IT spend growth >20% p.a. Increased regulation focus on increas
Slide 18: Road to 5-10% average annual growth in 2026
Road to 5-10% average annual growth in 2026 consists of underlying market growth, price increases, market penetration and new services Indicative 5-10% Market growth Market penetration, current offering New Services Organic growth M&A Total growth cross-sell, up-sell and pricing GDP Growth Increasin
Slide 19: Solid growth in core credit business with ESG, compliance and master data
Solid growth expected in the core credit business with additional growth to be prioritized through ESG, compliance and master data GROWTH OPPORTUNITIES Growth avenues Fraud PSD2 • Strong competitive position in core consumer and business credit information business in Finland and Compliance Sweden.
Slide 20: Road to margin expansion through scalable growth
Road to margin expansion through scalable growth, remodelled sales and distribution, Nordic consolidation of capabilities and cost efficiencies • New services in strategic growth areas and continuous enhancing of existing offerings Investing in scalable • Expansion to selected new and underdeveloped
Slide 21: Enento Group Plc – Investor Presentation Q3 2024
Q3 2024 Enento Group Plc – Investor Presentation Q4 2023
Slide 22: Key figures 2024 YTD
Key figures 2024 YTD Share of net Sales by NET SALES Business Area 2024 YTD FROM NEW SERVICES NET SALES 30.9.2024 15,3% 30.9.2024 112,6 MEUR BUSINESS 41% INSIGHT ADJUSTED EBITDA 30.9.2024 ADJUSTED EBITDA MARGIN 30.9.2024 59% CONSUMER 40,3 MEUR 35,8 % INSIGHT FREE CASH FLOW 30.9.2024 MARKET CAPITALIS
Slide 23: Key figures Q3 2024
Key figures Q3 2024 NET SALES -2,4%* ADJUSTED EBITDA -5,0% ADJUSTED EBITDA MARGIN 36,8 13,8 37,5 -6,0%* -1,4 pp-%* MEUR MEUR % FREE CASH FLOW 50,8% NET DEBT TO ADJUSTED EBITDA SHARE OF NEW SERVICES 10,7 2,5 16,6 3,7 pp-% MEUR X (2,4x) % * At comparable foreign exchange rates 23 Enento Group Plc – 29
Slide 24: Highlights Q3 2024
Highlights Q3 2024 No major changes in the macroeconomic and market environment; pace of market MARKET AND recovery is still slow despite of some signs of stabilization in the Swedish market CUSTOMERS New legislative measures introduced in Sweden to prevent over-indebtdness NPS from strategic and la
Slide 25: Efficiency Program update: 10 MEUR benefit surpassed
Efficiency Program update: Targeted 10 MEUR efficiency benefit surpassed on a run-rate basis FTE EFFICIENCY Further FTE efficiencies realized through voluntary redundancies Application maintenance and development transition in Sweden and Finland close to completed IT EFFICIENCY IT infrastructu
Slide 26: New Swedish government measures to prevent over-indebtedness
New measures introduced by the Swedish government in August 2024 to prevent over-indebtdness The Swedish government presented a legal proposal to enhance consumer protection and prevent over-indebtdness Several measures are proposed, but it is stated that they will not proceed with the register of d
Slide 27: Swedish regulative proposals positive for Enento over time
Swedish regulative proposals are overall positive for the Swedish society and for Enento over time despite of resulting consumer credit volume headwinds Enento continues to be an essential part of the credit ecosystem in Sweden Enables us to further develop and invest into our consumer credit busine
Slide 28: Looking Ahead: Business Area Update
Looking Business Ahead Area Update Enento Group Plc – 29 October 2024
Slide 29: Business Insight
Business Insight Positive net sales development in Finland Highlights Q3 2024 and Norway. Enterprise and Premium were stable, whereas Real Estate and Freemium • Sales growth was strong in Norway while Finland had steady demonstrated very good growth development and Sweden continued to decline • Ente
Slide 30: Consumer Insight
Consumer Insight Consumer credit information demand was Highlights Q3 2024 muted both in Sweden and Finland, volumes have stabilized on a quarter-to- • Consumer lending market recovery continues to be slow in quarter basis but not yet turning to growth Sweden as loan broker channel activity and volu
Slide 31: Corrupt data is the New Reality: We invest in fraud protection
Corrupt data is the New Reality We invest in fraud protection Market situation Customer need • A market based on trust is no longer a reality • Predicting and preventing fraud is increasingly • Fraud is an increasing problem in the society across complex and requires more targeted real time data Nor
Slide 32: CFO Highlights
CFO Highlights Enento Group Plc – 29 October 2024
Slide 33: Key figures Q3 2024
Key figures Q3 2024 Q3 2024 Net sales -2,4%* Adjusted EBITDA -6,0%* Adjusted EBITDA % Adjusted EBIT -8,0%* Net debt to adjusted EBITDA -1,4 pp-%* 36,8 13,8 37,5 10,9 2,5 0,1x MEUR MEUR % MEUR X Q3 2023 Net sales Adjusted EBITDA Adjusted EBITDA % Adjusted EBIT Net debt to adjusted EBITDA 37,3 MEUR 14
Slide 34: Revenue by business area
Revenue by business area GROWTH AT COMPARABLE FX RATES +2,2% Comments Q3 / 2023 21,5 Q3 / 2024 20,9 Business Insight -8,3% → Stable development and sales continued to grow 16,5 → Norway continued strong performance. Finland 15,4 grew as well. Development in Sweden was more muted in Premium and Freem
Slide 35: Consumer Insight revenue declining, quarter-to-quarter stabilizing
Consumer Insight revenue continued to decline from last year, but quarter-to-quarter development is stabilizing Business Insight revenue quarterly Consumer Insight revenue quarterly 24.0 24.0 19.4 22.6 22.4 22.8 22.6 22.2 23.0 19.0 19.0 18.1 21.5 21.5 17.6 20.9 16.8 16.5 16.3 15.1 15.4 15.4 Q1 Q2 Q3
Slide 36: Adjusted EBITDA decreased mainly due to lower consumer credit revenues
Adjusted EBITDA decreased mainly due to lower revenues in consumer credit information Comments → Adjusted EBITDA margin was 37.5%, a decrease of 1.4pp year-on-year at comparable rates and decrease of 1.5pp year-on-year at reported rates 0,9 → Adjusted EBITDA decreased year-on-year due to challenging
Slide 37: Free cash flow remains strong and cash conversion improved
Free cash flow remains strong and cash conversion improved Comments → Free cash flow remains still solid and increased in the third quarter of 2024 from previous year 10.7 to EUR 10,7 million (EUR 7,1 million) due to 10.5 higher operating cash flow thanks to positive 10.0 10.1 working capital impact
Slide 38: Key indicators
Key indicators EUR million (unless stated otherwise) Q3 / 2024 Q3 / 2023 YTD / 2024 YTD / 2023 FY 2023 Comments Net debt 136,8 145,6 136,8 145,6 139,7 → Cash position at EUR 17,0 million (committed EUR 30 million facility Net debt / adjusted EBITDA 2,5 2,4 2,5 2,4 2,4 remains fully unutilized) → Net
Slide 39: Distribution of dividend 1.00 EUR per share in total
Distribution of dividend 1.00 EUR per share in total The Annual General meeting held on 25 March 2024 approved the Board of Director’s proposal to distribute funds of 0.50 EUR per share as dividend, followed by an additional dividend up to maximum of 0,50 EUR per share subject to the Board decision
Slide 40: Outlook and guidance for 2024 unchanged
Outlook and guidance for 2024 unchanged The Company’s operating environment remains challenging due to uncertainty in the general economic situation, which is expected to continue to affect Enento’s financial performance. Enento’s Swedish consumer credit information sector continues to face a challe
Slide 41: Thank You! Time for Q&A
Thank You! Time for Q&A Enento Group Plc – 29 October 2024
Slide 42: Financials Q3 2024 Summary
Financials Q3 2024 Summary Enento Group Plc – 29 October 2024
Slide 43: Overview
Overview EUR million Q3 / 2024 Q3 / 2023 YTD / 2024 YTD / 2023 FY 2023 (unless stated otherwise) Net Sales 36,8 37,3 112,6 117,0 155,9 Change (year-on-year, comparable fx) -2,4% -2,2% -3,9% -1,2% -2,6% Adjusted EBITDA 13,8 14,5 40,3 43,7 57,1 Change (year-on-year, comparable fx) -6,0% -5,5% -7,9% 1,
Slide 44: Income statement
Income statement EUR million Q3 / 2024 Q3 / 2023 YTD / 2024 YTD / 2023 FY 2023 Net sales 36,8 37,3 112,6 117,0 155,9 Other operating income 0,0 0,2 0,1 0,3 0,4 Materials and services -6,9 -6,5 -20,7 -20,0 -26,6 Personnel expenses -7,9 -8,0 -28,7 -29,8 -40,1 Work performed by the entity and capitalis
Slide 45: Cash flow
Cash flow EUR million Q2 / 2024 Q2 / 2023 YTD 2024 YTD 2023 FY 2023 Cash flows from operating activities Cash flows before change in working capital 11,5 13,2 35,9 40,6 51,2 Change in working capital 3,3 -3,6 1,3 -1,7 1,0 Net interests and other financing items -4,0 -3,5 -7,6 -5,7 -6,2 Income taxes
Slide 46: Net sales by quarter
Net sales by quarter 43,4 42,9 40,7 40,5 40,0 39,7 38,9 38,5 37,3 37,3 36,8 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Net sales, EUR million 46 Enento Group Plc – 29 October 2024
Slide 47: Net sales growth
Net sales growth 7,1 4,4 4,8 4,9 4,1 2,6 3,1 2,3 -0,4 -1,7 -1,3 -2,2 -2,4 -3,5 -3,0 -2,9 -6,5 -6,8 -6,3 -7,8 -8,6 -9,3 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Net sales growth at reported FX, year-on-year, % Net sales growth at comparable FX, year-on-y
Slide 48: Enento Group Plc
Enento Group Plc Henrik Soras Head of IR & Strategy +358 40 184 3449 henrik.soras@enento.com Elina Stråhlman CFO +358 40 564 7877 elina.strahlman@enento.com