BIMobject AB (BIM) Earnings Call Transcript & Summary

Hello, everyone, and welcome to this webinar. Thank you for taking the time on this Friday and in July, perhaps from your vacation to listen to us as we present our Q2 presentation for you. So as usual on the call today, you can send your questions to ir@bimobject.com, where we will do a Q&A section at the end of the call. So you can either use the chat function here in the Zoom webinar or ir@bimobject.com is where you reach out. But allow me to present our panelists today. We are joined by Niklas Agevik, who is the CEO of BIMobject. Welcome, Niklas.

Thank you.

And we're also joined by Per Goransson, who's the CFO of BIMobject. Welcome, Per.

Thank you.

My name is Lisa, and I'll host the call for you here today. On the agenda, as usual, we are going to hear a business update from Niklas, and then, we're going to talk through some of the financial numbers for the quarter. And as mentioned, we'll wrap up the call with a Q&A session. We have some questions already come into the e-mail. So we'll answer those for you, and you can send us questions along the way as well. But without further ado, I'll leave the word to you, Niklas.

All right. Thank you, Lisa. Good, if we can go to the next slide. We had a strong quarter. We ended the quarter with an ARR growth of 11% since last year. This, of course, also translated into higher revenue and ending the quarter with a revenue growth of 10%. And if we adjust for the currency effect from last year, that's even higher at 14%. EBITDA was as expected at minus SEK 21.7 million, but that figure does include the restructuring program that we announced during Q2, where we restructured into 2 business areas. That restructuring program was a cost of SEK 11.7 million, so without that restructuring costs, we would have ended with EBITDA at minus SEK 10 million. We also ended the quarter with SEK 147 million in cash. I can add that one contributing factor to this number is that we did have the options program from 2023, the LTIP program, which many of the employees converted into stock, which also added an extra SEK 8.6 million in cash. And as I mentioned, I mean, the major event here that shaped this quarter was our reorganization into 2 business areas, Design Enablement and Data Solutions. And I thought I'd go and do a quick recap about our strategy and why we did the recap -- why we did the reorg and how that ties into our strategy. For those of you that have followed along on previous quarterly report and maybe even attended the AGM, this will be mostly a repetition, but I'll keep it short. So the background here is that, as you know, we've done BIM models for many years, and that continues to be the core of our business. We've been very focused on the 3D models part of the BIM object, but actually, a BIM model can contain a lot more data, like object properties and climate data, technical properties and compliance data. And our strategy -- our growth strategy has been to expand beyond just those 3D models and have complete data around the object in our database. And that data is needed by industry databases, different planning tools and by distributors like Ahlsell that we have already announced that we are partnering with. And that was the background to our reorg that we already have this strong, established business, distributing the BIM files to the AEC community. And we want to keep running it that way as a profitable growing business. Meanwhile, the new products that we have added like Prodikt, like Connect and EandoX. They are more in an early phase, where we are investing, and we want to invest towards the milestones that we believe are important to make them successful. Last, I just want to give a quick update on Data Solutions. The big work here that we're doing and that we talked about on the AGM is the new AI-powered version of Prodikt. It will onboard customers much faster. It will provide much more accurate data, thanks to the automatic collection of data and do advanced functions like fit that together data into a complete EPD. We are already in a strong position for Data Solutions when it comes to partnerships we need to execute on that plan. The big thing that we're working on right now is the product development. We're almost ready to start testing with live customers to give you a little bit of understanding where we are in the development process. So with that said, I'll hand over to Per to dig down into the financials.

Yes. Let me take you through the quarterly financials. And overall, again, keep in mind, recurring revenue kept growing, and the underlying cost base came down and the reported result carries the cost of restructuring we carried out through the quarter. Starting with revenue. Recurring revenue grew 10% or 14% adjusted for currency, and ARR is up 11% in constant currency with contribution from both Design Enablement and Data Solutions. The platform business held up through the restructuring, and retention in the existing customer base continues to develop well. New sales were somewhat affected by the restructuring. But overall, we have a stable platform business. Services revenue came down to SEK 4.5 million from SEK 6.7 million. Part of that is restructuring, part is our shift in Data Solutions from project work towards platform revenue. Net sales in total landed at SEK 42.6 million against SEK 41.0 million. The split in ARR is roughly SEK 136 million in Design Enablement and SEK 16 million in Data Solutions. The Design Enablement is the mature business on bimobject.com. Data Solutions is smaller and still in investment phase. And the products we're building towards haven't fully launched yet, like Niklas mentioned, and that's where the investment is going. Operating costs were up 4%, including restructuring and down 11%, excluding it. The reduction comes from fewer employees and fewer consultants. And the yellow bars show the restructuring costs in each quarter here. We're not introducing an adjusted EBITDA as an ongoing measure, but this quarter, the restructuring costs are large enough to point out specifically. And the large majority of the restructuring cost is personnel costs for employees released from duty during the notice period. A smaller part is consultancy and legal fees connected to carrying out the reorganization. Part of the effect is already visible, but we expect the underlying cost base to come down somewhat further once the restructuring takes full effect. Reported EBITDA was minus SEK 21.7 million against SEK 20.6 million last year. That includes the SEK 11.7 million of restructuring costs I just went through and -- against SEK 2.9 million last year. Excluding those costs, EBITDA improved to minus SEK 10.0 million from minus SEK 17.8 million, and that's the number that shows where the business is heading. EBIT was minus SEK 25.7 million and minus SEK 23.1 million last year.

Great. Thank you, Per. And I think with that, we can move over to questions.

Thank you. We're keeping it short since it's Friday in July for everyone. But we do have some questions, and we'll take them now. So the first question comes related to Data Solutions. So the question is then, how has Data Solutions developed? And what concrete progress has been made since Q1 in this area?

I think the major product progress that has been done is the product development, where we are moving forward according to plan. We will not announce a release date, but as I mentioned in the presentation, we are at a point where we are ready to start testing it live with real partners and manufacturers.