Interim Report Safeture AB Q2 2024: Continued improved profitability

Classics

First six months (2024-01-01 to 2024-06-30)

• Net revenue amounted to 27 525 (21 744) KSEK (+27%).
• EBIT amounted to -571 (-4 086) KSEK.
• Loss per share before dilution amounted to -0,01 (-0,10) SEK.
• Loss per share after dilution amounted to -0,01 (-0,10) SEK.

Second quarter (2024-04-01 to 2024-06-30)

• Annual recurring revenue (ARR) at the end of Q2 2024 reached 57 001 (48 623) KSEK, a year-on-year increase of +17%.
• Recurring revenue increased by +25% to 13 727 (11 011) KSEK, which represents 99% (99%) of the quarterly revenue.
• Churn for the quarter was 0,8%.
• Net revenue retention (NRR) was 103%.

SaaS traction

Second quarter (2024-04-01 to 2024-06-30)

• Net revenue amounted to 13 898 (11 075) KSEK (+25%).
• EBIT amounted to -152 (-1 597) KSEK.
• Loss per share before dilution amounted to 0,00 (-0,04) SEK.
• Loss per share after dilution amounted to 0,00 (-0,04) SEK.

Message from the CEO

"Continued improved profitability"

Continued improved profitability

Safeture results were just shy of a positive one in the second quarter with an operational result (EBIT) @-152 KSEK. The quarterly churn was back at low numbers (0,8 %), sales were short on target (25%) and the gross margin was spot on target (80%); this is in line with reaching our financial goals in the near future.

Partner Growth formula

Sales in the second quarter amounted to 13,898 KSEK (99% recurring revenue), which is +25 % compared to last year. This is below our financial targets but in line with our indication in our Q1 report, given the continued uncertainties in the market. Partners are the driver of growth, accompanied also by additional upsell on the installed base, which significantly contributes to the total revenue. Another growth driver was our continued development and expansion of our recent partnership with a French insurance company. Here we see a great potential to catch.

For the past quarter, our largest partners have been busy working with existing clients, thereby adding fewer new logos. On the other hand, we see our partner development work taking effect and relatively new partners starting to add clients all over the world, from Europe to Australia.

Partner development has been a key initiative for us during the past year and is important for Safeture to scale. This also underlines our two-fold growth formula; To be able to get introduced to existing clients of the partners as well as to win new ones in direct deals or RFPs.

Balancing around profitability

Right now, and most likely in the coming quarters as well, we will be balancing around profitability. Several causes can potentially turn it either way at any given quarter. One example is currency exchange fluctuations, given our large international exposure with approximately 93% of our revenue in foreign currencies. Financial transactions in foreign currencies are reported at the exchange rate on the specific transaction date. Additionally, on the day of the fiscal quarterly closing, all outstanding receivables are revalued with the closing rate of that specific day. This means we can receive rather substantial currency revaluation effects on the last closing date, which are difficult to predict. Another example is personnel cost fluctuations driven by customary vacation periods where costs are typically low in Q3 but rising again in Q4. To sum up, we will stick to our target of sustainable profitability at around 65 MSEK going forward.

Our licenses are sold through a SaaS business model, meaning our customers are contracted to pay a license fee yearly in advance. This model, in combination with a high operational focus on cash flow, is a great strength in our company. During the first six months, we have managed to increase the cash with more than 2 MSEK, to be compared with -6,6 MSEK during the equivalent timespan previous year.

Building world-class technology, supporting clients globally

Safeture is the thought leader in people risk management, and our goal is to maintain and develop that position. We will continue to invest in our platform, especially since we see growth opportunities in the market for risk management, which is riding a global trend.  

It is time for summer, and there are plenty of high-risk events taking place, including the European championship in football and the upcoming Olympics in Paris starting July 26th. Safeture will be safeguarding people both before the event with our provision of valuable pre-event information and on-site with our technology and partners standing by. 

In our 15[th] year of working in this space, Safeture is helping people stay safe with an ever-expanding offer covering more organizations and users than ever.   

Lastly, I also take the opportunity to welcome our new board member, Thomas Wandahl, who was elected at our recent Annual General Meeting. Welcome Thomas Wandahl. Long career in the service and Telco industry and on the nomination committee's radar due to his former role as Managing Director of Falck Global Assistance. Thomas will be contributing with additional insights in how our current and future partners think and operate.

Magnus Hultman, CEO at Safeture.

Lund - July 19th 2024

For the full report: https://investor.safeture.com/financial-reports-presentations/

For additional information, visit safeture.com or contact:

Safeture CEO Magnus Hultman: +46 706 00 81 66. Magnus.hultman@safeture.com

This information is such information as Safeture AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, on July 19[th] 2024 at 08:00 CET.

About Safeture AB
Safeture (founded in 2009) is a Software as a Service (SaaS) company based in Sweden. The company offers a complete platform designed to handle safety and risks for employees, wherever they are. Through world-leading technology and innovative solutions, Safeture helps risk management- and assistance providers secure their clients, global companies, and organizations to protect what matters most - their people. The Safeture share is listed on the NASDAQ First North Growth Market Stockholm (ticker: SFTR). Redeye is the Certified Adviser.