Fortnox
Fortnox - ARPU continues to hike (ABG Sundal Collier)
2019-08-22 09:09
Sales +43% y-o-y & +4% vs. ABGe, EBIT +9% vs. ABGe
In line customer intake, but ARPU is increasing
Share is trading at 15x ‘19e EV/Sales on unrevised est.
Q2 details: sales SEK 129m, EBIT SEK 40mSales amounted to SEK 128.8m, representing a y-o-y growth of 43%. This was 3.8% above ABGSCe, where the sales beat stemmed from a strong ARPU of SEK 154 (+6 SEK vs. ABGSCe). Q2’s customer intake was 13,000, which was on pair with our expectation. EBIT came in at SEK 39.9m (+9% vs. ABGSCe), corresponding to an EBIT margin of 31%. Our forecast was SEK 36.7m and 30%.
Initial Q2 reflections
Besides a constantly maturing customer base, where the amount of modules per customer is gradually increasing, we believe that the ARPU increase is largely a function of Fortnox’s recent decision to enhance the bundling of its solutions, which was materialised as of April 2019. As such, the ARPU rose SEK 21 compared to Q2’18. Because an enhanced bundling of modules has likely had a negative effect on the customer intake, we regard the 13,000 new customer during the quarter as a solid number.
Share is up 102% YTD, trading at 10x EV/Sales on ‘21e
In light of this report, we expect to lift our sales estimates for ‘19e-‘21e, largely coming from increased ARPU assumptions. YTD, the share is up 102% and is currently trading at 15x-10x EV/sales on ’19e-‘21e on our unrevised estimates.
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