StrongPoint - Strong quarter with cost cuts ahead - ABG
* Q3 reported EBITDA NOK 18m vs ABGSCe NOK 10m * Sainsbury's still slow, but US and Spain wins build pipeline * Pricer transition drag is fading, Vusion momentum building
ANNONS
Q3: Reported EBITDA of NOK 18m vs ABGSCe NOK 10m
Total revenues came in at NOK 364m, 6% above our estimate of NOK 342m, and up ~14% y-o-y, with strong performance in the Nordics +20% (despite NOK 13m recurring revenue loss due to former ESL partner) and Spain +58%.
GP was +3% above our estimate, driven by higher revenue and offset by a gross margin of 41.1% (ABG 42.4%). EBITDA came in at NOK 18m vs. ABGSCe NOK 10m, as higher revenue and lower opex more than offset the weaker gross margin. EBITDA margin landed at 4.8% (vs. ABGSCe 3%). Net finance was NOK -10m vs ABGSCe -2m, offsetting the EBITDA beat. EPS came in at NOK -0.05 vs. ABGSCe of -0.05. Net debt came in at NOK 103m (NOK 57m in Q2).
StrongPoint remains cautiously optimistic on continued improvement in both EBITDA and recurring revenue. The cost programme has moved from identified to started: it targets external costs (consultants, IT and other services not directly supporting customers), staffing aligned with commercial needs, and core processes. Management expects significant cost reductions over time, but some initiatives will add costs in the short term. Quarterly fluctuations are expected given variable project timing, but the long-term ambitions are unchanged: healthy revenue growth and a >10% EBITDA margin.
Sainsbury's still slow, but US and Spain wins build pipeline
Sainsbury’s remains slow. It is still live in a double-digit number of stores, with more recently added, but the temporary cut to the volume commitment remains and weighed on UK service revenue and EBITDA in Q3. Management says the rollout is taking longer than expected as both parties work on additional functionality, and no date is given for restoring the commitment. But Order Picking is gaining traction elsewhere. Iceland Foods is trialling it for all online orders and the trial is live in over 80 stores. Signed in Q3, Meijer became StrongPoint's first US Order Picking customer, validating the platform in the largest Western grocery market. On 27 October, StrongPoint also announced a Spanish grocer order covering ~100 stores with Vusion’s EdgeSense, Captana and almost 1m ESLs, rolled out over two years with StrongPoint Spain as main contractor.
Pricer drag fading, Vusion momentum building
The Pricer recurring run-off will remain a headwind through the year, but most of it is now behind us. The rolling 12-month Pricer ESL base has fallen from NOK 51m in Q3'25 to NOK 17m now, with NOK 13m lost in Q3 alone. Management says building a Vusion recurring base will take time, but Coop Estonia in Q2 and the recent Spanish order are further proof of the potential.
