Lime Technologies AB (publ)

Hello, everyone, and really, really sorry for the disruption earlier. We had some sound issues and it seems to be fixed. So let's dig into the presentation again. We start from the beginning, of course, and make this a really strong presentation. So welcome, everyone, and to our Q2 update. My name is Nils Olsson. I've been joining Lime since 2006 and been a CEO since 2021.

And my name is Anders and I'm CFO at Lime since September 2024.

Perfect. Feel free to write any questions in the chat and of course we will answer them at the end of the session. so before we dig into the numbers here and a little bit more in depth of the q2 presentation let's give a brief overview as always about lime and um as you know we've been always been running line with a very long-term perspective and that has left us with a fantastic footprint over now in more than 20 years we've been growing in average 19 per year with an ebitda margin of 25 in average per year and that's something that i'm really really proud about But no matter how big we've been, how many markets we entered, more or less our goal has always been the same and it keeps being. And that is to help our customers to become really strong in sales, in customer care, so they can help their customers in a good way. Meaning that we are focusing on our customers' customer. And as a supplier, we are at strongest, I would say, when we combine on point expertise and really strong software to solve mission critical problems. And we also become a national part of our customers core processes. Over the years, we've been scaling Lime and we are into seven markets. And the last couple of years, we've been entering Netherlands in 2020, Germany in 2021. And we also welcome a couple of other companies into the group. Usealike, today known as Lime Connect in 2021. We had also Sport Admin and PlanPlan in 2024. So now we are present in seven markets, 12 offices and almost 500 employees. And looking at some of our key success factors, long term profitable growth, that's in our DNA and something that is really important for us. We also have a good business model. Today, 67% of our revenue is recurring, so it's a stable base. We are not depending on one or two or five big customers, so we have a low customer concentration. And something that I would say has built Lime to what it is today is a strong corporate culture. And that's something that we continue to invest in with our big onboarding programs, normally twice a year. So let's get into a sum up of Q2 and starting with some numbers here. You can see that the revenue growth amounts 5%, EBITDA margin 25% and the ARR growth was 13%. And I will say that we continue to face a bit of challenging macroeconomic climate. We see longer sales cycles and a bit of reduced willingness to invest, especially if we look into existing customer base. The good thing is that we are remaining a strong momentum in new sales, particularly in Lime CRM. But despite the challenging period, I would say that we are making a steady progress towards a greater focus on recurring software revenue. As I said, 67% of our software revenue is now recurring. And in the quarter, I'm really glad that we passed a key milestone with over 500 million SEK in ARR. looking into our different business units and starting with with lime crm and in crm we continue to demonstrate i would say a really competitive strength especially within our verticals and this is driving a strong new sales momentum and i'm happy to to see the progress on in the german utility sector where our long-term investments now is starting to pay off with several new deals. And with our historical track record, I think that we are well positioned to continue that growth in a big market as the German market is for us. The strength of also we can see in the platform, it enables a faster delivery of business critical workflows. We also see that on integrations and in customerizations. So over time, I see this as a natural shift of revenue mix towards a higher recurring software revenue. And also, if we look at it in a little bit longer perspective, I would say also an improved profitability. As a result of that, of course, expect services will gradually decrease. New news about that and as a share of the total revenue. In short term then, what kind of impact has this? This shift, of course, combined with a little bit macroeconomic situation and the cautiousness and willingness to invest among existing clients, of course, impacts the growth. Expect services still accounts for over 30% of the total revenue. And as you know, a big part of that comes directly from existing customer base. If we jump back into LimeGo, I would say that we continue the progress and we close deals within more deals within our ideal customer profile. And that's a focus of a little bit higher deal value and a little bit focus on larger companies. And this allows us and give us the possibility actually to deliver more value in the product. But also we can see that the customer churn is decreasing, which is in line with our plan. From a new sales perspective, I would say that we are on an okay level. But like CRM, the upselling towards existing customers remains a bit challenging. I think that we can do better in LimeGo. And during the quarter, as a result of that, I think that we put a lot of emphasis on the new sales and we have increased the pace in the sales activities. But we are also seeing, since we have a nice bet on new sales, that we are expanding the sales team, hiring more sales reps. And I hope that this will improve the momentum going forward. Inline Connect, which we primarily focus on the German market, we see more or less the same kind of behavior, a little bit cautiousness in investments, and that holds back sales, especially on the existing client base. And to meet that kind of challenge, we are significantly increase our sales activities. And that's something that I think is really strong. We have tripled the outbound activities and then done more fairs and events, which is in line with working more together with sales and marketing. also there i think that that we can do better going forward and but i once again i'm proud of how the team is more stepping up and i really believe that this is going to pay off in the long run from a sport admin perspective um the past quarter of course has marked a gradual return to the normal operations following the cyber attack in january and to start with i would really like to express a warm thanks to all of our customers um whose support and continued trust has made us stronger and even more determined, I would say, to really continue to make a difference in kids and youth sports. With now the experience that we have gained and a better product than ever, I think that we are definitely ready to help more clubs to digitalize their operations, both on the Swedish market and of course across europe and the acquisition of the dutch company plan plan that we did in december 24 marks our first step into the national international expansion and as for now we are actively exploring further acquisition in that business area So looking into the agenda then, we will as always look a little bit more in depth into the order intake. We will talk about the revenue, Anders will talk about the profit and then we do the sum up and the Q&A in the end. So let's start with the order intake. As we have communicated for many quarters, our customer concentration continues to be on a low level. Today, our top 10 customers stands for 6.3% of the revenue and the biggest one stands for 0.8% of the revenue. still it's good that we have this dynamic because we're not depending on one or two of a few big customers we do deals with many customers in different geographies and also in different verticals Looking into the deals then, and we are welcoming a number of important customers in LimeCRM, both in our home market and also on the international markets. And I'm really, really glad to see that our long-term efforts have started to pay off when it comes to the utility customers in Germany. Stadsverket, Stralsund and Vikten, we welcome in the quarter. Looking into the real estate segment, I think also that we have a good momentum there and welcoming Bonnier Fastigheter, Stienvalvet as new customers. And in the wholesale vertical, we are deepening our collaboration with a customer since 2012, New Wave in Norway. And other important customers that we are welcoming in the quarter is an expansion of the Porsche account, which is important for us in Lime Connect. But also if we take Lime Go in spots, for example, a perfect Go customer in the right segment and size. And for Sport Admin, as I said, we have had great support from our existing customers during the spring. And we don't see any higher customer churn during the first half year. And looking into new sales, it's been tougher, of course, for obvious reasons. But we are happy to welcome several new clubs. And among these two new football clubs, Roslett and Karlstad. So looking in a bit on the revenue side instead, and we're looking to the ARR. And as you know, as a product company, it's, of course, very important to look at the ARR growth. And this is something that we will follow even more closely as one of our core KPIs going forward. And this is, of course, in line with our strategy shift to even more recurring software revenue that I mentioned earlier. Looking at our subscription alone, it's growing by 16% compared to Q2, 24. And looking at the service agreements, we can see that decrease of 36%. And that's in line with our strategy. We are converting customers from old upfront agreements into the new subscription agreements. And in total, it builds up to 13% growth in the ARR. Looking at our different revenue streams and a little bit on development there, as I said, subscription growing steadily, 16% in Q2 and 23% last 12 months. Service agreement stands for 3%. And we continue the transformation of old customer and service agreements into subscription. And in total, that's add up to 67% recurring revenue of the total revenue. So a good development there. upfront is the same amount as as the quarter before so less than one percent and looking at expect services we had a negative growth in in q2 and today it stands for 32 of the revenue and it will continue to grow so that's an important part so we can improve there in the long run as i've already mentioned but in the long run decrease as a part of the total net sales going forward If we look at revenue then, looking at the growth, we reached 5% in Q2 and the last 12 months we have 13% growth. Looking at the split, Sweden grows by 6% and the rest of Europe 3%. The deviation between outcome and expectation is primarily due to expect services, where we have a negative growth, as I said, in the quarter, mainly driven by that our platform makes it easier to do implementations, integrations, customizations, but also an effect of the macro climate where we are having a harder time doing sales towards existing customers and in expect services, 60% of the expect services revenue more or less come from existing client base. Looking at the last 12 months, we grow 15% in Sweden and 9% in rest of Europe. So profit, Anders.