H1 2024 report - Implementing the new growth initiatives

Company announcement no 14-2024

Søborg, August 22, 2024

H1 2024 report - Implementing the new growth initiatives
In Q2 2024, the net ARR increase amounted to DKK 0.2m, reaching DKK 19.6m on June 30, 2024 an ARR growth of 5% (YoY). During Q2 2024, focus was on implementing the new growth initiatives and developing the new Konsolidator Banking application. While there has been good progress in the new initiatives, and sales in Denmark remain satisfactory, international sales did not meet expectations due to longer decision-making processes and thus sales cycles, and therefore, we have lowered our expectations for the full 2024. Further, our capital structure will be strengthened by either a capital increase, or income from the growth initiatives together with the initiated cost reduction in the sales and marketing department.

The second quarter of the year was busy, with a strong focus on completing the first go-to-market version of the new banking application and we closed the first two customers in Konsolidator Iberia. However, sales in the existing business did not meet our expectations in Q2 2024. As a result, Konsolidator lowered the expectations of ARR of DKK 24-28m to DKK 21-23m and EBIT loss to 10-12m in 2024 (see company announcement no 13-2024)

In Q3 2024, the focus will be on strengthening the capital structure and improving the operations as well as securing the funding of the operations. Konsolidator is currently exploring possibilities to secure funding from investors, banks and loan providers.

“H1 2024 has been affected by a lack of sales to international customers. The slow international sales resulting in an unsatisfactory result in our CAC/new ARR has led us to restructure our marketing department and focus on improving the CAC/new ARR. In the longer term, we are getting ready to harvest the return on the investments made in the new growth initiatives. We have high expectations of our new Konsolidator Banking Application and Konsolidator Iberia.”,says CEO Claus Finderup Grove.

Financialhighlights

• Revenue in Q2 2024 amounted to DKK 4.9m, compared to DKK 4.7m in Q2 2023, and for the first half of 2024, revenue increased by 5%, which was below expectations.
• EBIT loss for Q2 2024 amounted to DKK 4.3m compared to a loss of DKK 3.6m for Q2 2023. In H1 2024, EBIT loss was DKK 7m compared to a loss of DKK 6.5m in H1 2023.
• On June 30, 2024, Konsolidator had negative equity of TDKK 0.4m compared to an equity of DKK 2m on June 30, 2023.
• Cash and cash equivalents amounted to DKK 0.3m on June 30, 2024.

SaaS metrics

• In Q2 2024, Annual Recurring Revenue (ARR) increased by DKK 0.2m compared to DKK 0.1m for Q2 2023. On June 30, 2024, the total ARR amounted to DKK 19.6m, an increase of 5% compared to June 30, 2023. The growth initiatives together with the expected reduction in churn are expected to generate higher growth rates than the previous years
• The Customer Acquisition Cost (CAC) divided by new ARR has been calculated to 55 for Q2 2024 compared to 68 for Q2 2023. With the reduction in cost in sales and the outsourcing of the digital marketing the total cost will be reduced, which is expected to improve the CAC / ARR ratio
• The net increase in ARR of DKK 0.2m in Q2 2024 has been generated at a cash cost of DKK 4.1m, equaling 0.05 times, compared to 0.0 times in Q2 2023. For H1 2024, this metric equals 0.03 times, compared to 0.2 times on June 30, 2023.
  
  
• On June 30, 2024, the churn for the last 12 months was 13.7% compared to 9.2% on June 30, 2023. The increase in churn is still impacted by the stronger cost focus from smaller customers. The positive effect of the initiatives from the customer success department and the fact that a higher number of new contracts are for 2 years, is expected to show significant results.
  
  
• The net retention summarized to 95 has been influenced by churn as expected in Q2 2024 compared to 100 on June 30, 2023.

Outlook 2024:

• The outlook for 2024 has been adjusted as announced in company announcement no 13-2024 August 20, 2024, which is as follows:
  • ARR of DKK 21-23m (prev. DKK 24-28m)
  • Revenue of DKK 21-23m (prev. DKK 23-27m)
  • EBIT loss of DKK10-12m (prev. a loss of DKK 0-5m)

Investor webinar

• On August 22, 2024, at 12.30 (CEST) an investor webinar will be held. Sign up here.
  
  

Contacts

• CEO: Claus Finderup Grove, mobile +45 2095 2988, cfg@konsolidator.com
• CFO: Jack Skov, mobile, +45 2282 8845, js@konsolidator.com

Certified Adviser

• Grant Thornton, Jesper Skaarup Vestergaard, phone +45 3527 5011, www.grantthornton.dk
  
  

About Konsolidator
Konsolidator A/S is a financial consolidation software company whose primary objective is to make Group CFOs around the world better through automated financial consolidation and reporting in the cloud. Created by CFOs and auditors and powered by innovative technology, Konsolidator removes the complexity of financial consolidation and enables the CFO to save time and gain actionable insights based on key performance data to become a vital part of strategic decision-making. Konsolidator was listed at Nasdaq First North Growth Market Denmark in 2019. Ticker Code: KONSOL

Attachment

• Konsolidator H1 2024 Report