Formpipe Software AB (publ) ($FPIP)

A warm welcome to today's session here at ABG, where we have the pleasure of hosting Formpipe and its CEO, Sophie Reinius in conjunction with today's earnings results for the first quarter of 2026. My name is Simon Garnath, and I work as an analyst here covering Formpipe. And for the coming minutes, Sophie will present the quarter, and then we will follow up with a regular Q&A session. So if you do have any questions, please put them in the chat, and we will address those accordingly. So with that said, a warm welcome, Sophie, and please go ahead.

Thank you so much, Simon. Hello, and thank you for allowing me to present the Q1 results. As you know, we are still called Formpipe Software AB, but we are also then going through our name change, and that's why you will see our new brand going forward in the slides to come. But I'm presenting today the Q1 results with the emphasis of the strong margins and a sharper market focus. So starting then to look at our kind of main numbers in terms of Q1. We now have some new KPIs starting from 2026 as we are now a more pure dedicated software company. So if we start then looking on the left-hand side, we're going to measure recurring revenue and specifically our organic growth in recurring revenue, which for Q1 2026 was at 11% compared to Q1 last year of 10%. And then looking into the middle section of the slide, numbers that you hopefully recognize, both ACV and ARR. Here, we had a better result compared to Q4 with ACV of SEK 6 million compared to Q1 2025 of SEK 8 million and then resulting in an annual recurring revenue of SEK 228 million compared to last year of SEK 218 million. And then going to the right-hand side, when we're talking about margins and margin improvements, we see then a great result in terms of adjusted EBIT in percentage, which is then landing at 19% compared to 1%. And all of these are comparable numbers for Lasernet as a stand-alone company. And I also want to emphasize that we did not have any non-recurring costs for Q1. That said, I am then moving slides and going into our Q1 highlights. So a good quarter when it comes to Dynamics with 18 new customers signed. We also had a large deal signed in what we now refer to as Other ERP with Oracle, and we will come back to this in Q2 when we can talk more about this customer. We did also have some churn, mainly in banking and also in non-core specifically X-Docs. And as you might have seen now in our quarterly statements, we also have a breakout of the detailed ACV and ARR by segment, and I will come back to this later on in the presentation. And then also, as you saw in our first slide, we are now rebranded. So as part of moving from Formpipe, which now belongs to the public and the divestment, we are rebranding ourselves to Lasernet. So we had a rebranding that we launched in March, and we will then execute on the name change later on today at the Annual General Meeting, where we hopefully will then change our name for our main listed company. We also came out with the fact that we had a new partner agreement signed with IFS. So hopefully, we'll see more to come from that in the months and quarters to come. And also, we were winner Exchange Partner of the Year at Temenos event earlier this year. And then we also have a share repurchase program that we initiated in Q1. It was also completed in Q1. And then we have a proposal for a share redemption program, and that's for the AGM to decide on later on today. And that's the way of distributing the proceeds for the divestment of public of SEK 754 million, which will be approximately SEK 14 per share. With that said, I just want to re-emphasize a little bit about Lasernet and as a stand-alone, more dedicated company, what is it that we do? So in short, what we do is that we solve universal document challenges. We have more than 30 years of experience. We have more than 2,500 customers. We have more than 75 partners, and we are among 7 different offices around the world. So that's what we do. And I know there -- now there is a very busy slide, but it's just to emphasize how we then help our customers depending on which ERP they're in. So Lasernet is at the core of what we do together with Keep, which is the archiving function. And what we help is our customers, whether they're in the Dynamics 365 environment, whether they're in different ERP systems or even other banking cores such as Temenos or Thought Machine or Mambu, we're there to help in terms of providing document either generation or upload or storage or retrieval. And that means then that you as a customer can then either get these documents through signatures, through e-mail, printing, uploading or even retention. So that is in short what Lasernet does. And then, of course, you can read more about our different offerings on our website. And then I'm moving a little bit more into the Q1 numbers. So I said in the kind of header, we talked about sharper margins. And it's great to see that the work that we have done throughout 2025 with the different reorgs really showing us as a leaner and more sharper company and that we really can stand on our own 2 feet as a listed company on our own. So all the numbers are Lasernet only at Lasernet Group. And here, you can see quite clearly when you see the EBIT, so the adjusted EBIT margins as they have been improving since Q1 2024 and then now reaching 19% in Q1 of 2026 -- sorry. And you can also see the breakout of our different revenue streams. So the bold red is a positive red. That's our SaaS revenue that you can see then the increase quarter-by-quarter, but then also support and maintenance with a slow and steady decline and then a very small portion, which is license, which is constantly, of course, diminishing. And then we have the delivery on top, which is mostly performed by subcontractors. So it's fair to say that I think we are on a much healthier basis where we are now today. And again, also with us being a SaaS company with our recurring revenue, we also then have a very stable cash flow. So more than 90% of our revenue is recurring, which is, of course, a very good foundation to stand on. And then looking purely at SaaS, we can see that we have had a very nice CAGR in the past 5 years with growing 69% on a 5-year CAGR. And then, of course, with support and maintenance declining, but it really shows the value that we can bring with our offering to our customers. And then we have a new breakout in the actual quarterly communication. So we are breaking out ACV and ARR by segment. And I think it's better if you go into that table and look more specifically because it's hard to share in the presentation. But we have broken out ACV and ARR by our main segment, and that is then Dynamics as one segment. Banking is Temenos, Thought Machine, Mambu and other banking cores. And then we have other ERPs. And other ERPs is then, as an example, SAP, Oracle, all other ERPs that we are currently addressing. And finally, we have the non-core and those are the products which are maybe not core to our offering. So for example, we have X-Docs, which is our QMS system. We have e-mail filing, which is an outlook add-in towards eDOCS and some other smaller legacy softwares. So there, you can see the breakout, and I just -- we have highlighted the main topics here with then the net ACV of SEK 6 million in the quarter with 18 new customers in Dynamics, the churn of SEK 3 million. You also see the positive currency effect and then the net ACV additions. And that means that we're ending Q1 with an ARR of SEK 228 million. And then again, I know this is a busy slide, but I think it's also quite good to see the progress that we have made more in actual numbers. So again, of course, looking very good when we look into our SaaS revenue growing with 12% with a decline in support and maintenance with 11%, delivery reducing 22%, which is in line with our strategy as it is mainly conducted by subcontractors. And that leaves our recurring revenue growing -- I can't really see 3%. But then excluding FX, it is then 11%, the recurring revenue growth. And then that means a net sales at 0%, but excluding FX, it's a 10% growth. And then, of course, a large part of the margin improvement is the cost work that we've been working on. So with the organizational restructuring that we did both in Q1 of 2025 and also Q4 of 2025, we see that they have had a good impact into our numbers. So that means that we have a very solid improvement when it comes to our overall cost basis. And that has then given a very good improvement also in our EBITDA margins. So then reaching an EBITDA margin of 26% compared to 10% in Q1 of 2025. And all of these numbers are then Lasernet Group. So they are restated as a standalone Lasernet Group. And that means we are then landing at an adjusted EBIT of SEK 12 million compared to SEK 1 million in Q1 of last year. And then that also means a percentage of EBIT adjusted at 19% compared to 10% of last year. And also, again, emphasizing we didn't have any non-recurring costs in this quarter, but we did have in Q1 of 2025 with the first set of restructuring that we did. And with that, I am actually done. So I guess we will go to Q&A Simon.

Yes. Fantastic. Thank you, Sophie. Also, I encourage you all, if you do have any questions, please put them in the chat. And I do see that we have gotten a few already. But I'd like to start on a question from me at least, and that is on the ACV, which improved well in Q1 versus especially Q4 because Q4 was a little bit on the lower side as we also spoke about during that quarter. Can you help us understand the drivers of the recent improvements or is this more so a general lumpiness that we see in this business?

I think maybe more that Q4 was a bit on the slow side. And I think we were also a little bit affected by the divestment in public. I mean that has affected not just the public, but of course, the entire business. So maybe we lost a little bit of that momentum. And I think it's good to see that now we're kind of back to where we should see. So we have good relationship with our partners, and we're seeing that evolving. So I would more say that maybe Q4 was on the low side and that now we're seeing where we should be. But we're hoping, of course, to see even better ACV growth going forward.

And then building on that on the ACV, I know a couple of years ago, we spoke quite a lot about the momentum you have then been seeing with Temenos, but it has been a bit slower, and now we are getting the details on that. So I appreciate that we -- you're also breaking down that to a further extent. Could you still now give us some update if there are any changes in the customer dialogue when it comes to Temenos? Or what is the latest that you see with that?

I mean we have a very good dialogue with Temenos. And of course, winning this award, Exchange Partner of the Year shows the good relationship we have with Temenos. We have had a slower pipeline, and we have a pipeline, but is not as big and as active as we would like it to be. So we're hoping to see changes. But as for now, the numbers are what they are. And then, of course, we had a churn in the banking side as well. And I just wanted to talk a little bit about that. So that was a customer that actually never implemented the Lasernet product. So it was a Temenos customer and the project never went beyond workshop. So it never came to installation. And then 3 years down the line, there was no point in renewing a software where they don't have the underlying kind of banking core to support it. So that's why. But we hope to see improvement, of course. But for now, we're being cautiously, I wouldn't say optimistic, but realistic.

And I think that I heard 1 or 2 comments during the presentation, but on IFS, it's a new partner to it. How is momentum going there? And should we expect that there could be deals in 2026 already or is it more towards 2027, just to sort of understand?

I think it's too early to say. I think it's a new partner agreement, but then it's all about getting to know the ecosystem and the partners within IFS. So I would say it's exploratory at the moment. So I wouldn't bet on any IFS deals for 2026. I think we will need to take due course and getting to know the partners and that ecosystem. But then we are working with other ERPs as well in terms of Infor and SAP. So we'll see.

That's it. And a question we have got, if the negative currency effect was to be excluded, would the EBIT margin then have been considerably higher during the quarter?

Not really. So we do put the FX adjustments in the communication file. So we have a negative effect on the revenue side, but we also have a positive effect on the cost side. So when you look at the EBIT, it's actually quite a small effect. And that means that we are naturally hedged. So that means that, yes, we are distributed when it comes to geographies and our revenue streams in specifically dollars and euros, but our cost base is also evenly distributed. And that means that on an EBIT basis, I think it was less than SEK 1 million in terms of FX. So no big change in that.

And is there any reason that you do not report cash EBITDA, which is fairly standard for SaaS company today, i.e. to show the true cash flow generation by excluding amortization and depreciation.

These are the KPIs we have decided. But then, of course, you can easily see that in the quarterly financials, if you want to. And we don't have a very high depreciation. So -- but that's something we can look at going forward.

And in Q4, I recall you announced some layoffs. Did those cost savings bear fruit in Q1 or is there like a delay also when it comes to these layoffs?

No. They have borne fruit in Q1, absolutely. So we have seen the full effect of those reorgs and then, of course, we -- as I said, we are then at a very healthy margins, but we also want to, of course, invest in the future. So we are looking at certain specific recruitments in terms of go-to-market and sales that we are going to recruit during the year. But we will still remain at very healthy margins.

Sounds encouraging. And is those -- that plan on recruitment, is that fairly linear throughout the year? Or could it be very back heavy? Or is there anything to say about that?

No, I think we have like, I think, 1 or 2 open recruitments ongoing, and we might look at some -- I mean, it's going to be single-digit recruitments, right? So we're not talking about large recruitments for now.

Very good. And then I also had a question on the cash profile because now with -- given the recent divestments you have made, clearly, there is different dynamics in the current group as it stands today. Can you talk a little bit about the cash flow generation today versus historically, if there are any significant changes?

Absolutely. And there are quite large differences. So when we were -- when we had public also as a group, that cash generation was fairly distributed towards larger annual renewals in terms of payments, specifically within the Sweden side of the business. And now when we are more of a true SaaS company, it's really more recurring and we have a lot more, let's say, evenly distributed throughout the year. So quite a difference, I would have to say. So before, it was very heavy towards, I would say, November and December with annual kind of invoicing, whereas now it's, I would say, quite evenly distributed actually throughout the years.

So easier for us to predict this.

Yes, absolutely.

Good. And I again, want to encourage you calling in. If you do have any questions, please put them in the chat. Otherwise, I do have a question because when we talk about the growth rates, especially for software companies, there is usually 3 different buckets, new customer logos, upselling or price changes. Did you have any significant price changing tailwinds going into this quarter? Or how does the pricing strategy work?

No. I mean, I would say most of our kind of price adjustments are based on indexations, and they are then also evenly distributed throughout the year when the yearly renewal comes in, depending on when the contract is signed, that's when we put in those renewals or those indexations. So they will also be fairly evenly distributed throughout the year.

Good. And just a final question from me, unless we have any other questions from anyone else calling in. Do you feel like the organization is relatively set, except for those new positions that you're looking to recruit? Or could it be changes? Of course, you'll have to hire a permanent CEO are you expecting?

Yes, exactly. So I think that will be for a new CEO also to decide on how that person would like set up going forward. So I think it's a bit premature for me to talk about that. But as for now, I think we have a good setup.

Fantastic. I think that wraps this session up. Thank you so much for calling in and a special thank you to you, Sophie, for attending actually.

Thank you, Simon. Thanks, everyone.

Thanks.