Good morning, welcome to our Q2 presentation. My name is Terje Wibe, I'm the CEO of Mercell. With me today, as always, I have our CFO, Fredrik Eeg. The last time around, we combined our Q1 with a capital markets update where we shared our ambitions in detail. As you might recall, our vision is to be the preferred e-tendering and procurement platform in Europe by unleashing the full potential of a user-friendly and trusted marketplace. We are steadily moving forward in that direction. We have established a unique market position with unrivaled leadership positions in all the Nordic countries and in the Netherlands. These markets account for more than 90% of our revenue, although we have also established footholds in several other European markets and in the U.S. After our last acquisitions, we now service close to 30,000 customers, split between some 3,850 buyers and 26,000 suppliers. We are, in fact, one of very few players addressing both the buyers and the suppliers, which we regard as a major advantage in this market. By developing and growing a dual-sided marketplace, we can create great network effects as more tenders attract more suppliers and vice versa. We are also one of few players operating in multiple markets. We believe this will also play to our advantage, as the European markets are getting more and more digital and integrated. Our position makes us the natural consolidator in this market. Our rapid growth over the past two and a half years has made us one of the largest business-to-business SaaS companies in the Nordic region. Annual recurring revenue, so-called ARR, has increased almost eightfold in that period, from less than NOK 100 million to NOK 770 million at the end of June this year. We have done what we said we should do before listing on the Euronext Growth last year to consolidate the Nordic region and begin venturing into the European market. As you can see, this growth has been supported by a string of acquisitions, adding more than NOK 500 million in ARR at the time of acquisition. At the same time, we have grown ARR by close to NOK 150 million organically in both our legacy businesses and the acquired companies. The strong continued performance in the acquired companies show the potential of well-executed post-merger integration, and as an example, I'll get back to the development in Visma Commerce after the acquisition from Visma. Year on year, the ARR has increased by 158%, or NOK 471 million. A little over NOK 400 million of the increase is acquired ARR, but we have also added more than NOK 60 million, or 21%, organically over the past year. Given the growth and the acquisitions, reported revenue naturally lags ARR by some time, although the revenue for the past 12 months has more than doubled from Q2 2020 to NOK 505 million in 2021. Q2 was a very busy quarter in terms of acquisitions, both with the large acquisition of Cloudia in Finland, but also the bolt-on acquisitions of CTM Solutions in the Netherlands and Ibistic in Denmark. As you will know, we secured funding for the Cloudia acquisition in June through a NOK 400 million share issue and a SEK 500 million bond tap issue. Looking at the quarter isolated, we increased our revenue by 149% year-on-year and by 15% from the first quarter. Adjusted EBITDA came in at 28%, although the reported EBITDA margin was -1% due to large special cost items, mainly related to the acquisitions and the uplisting to Oslo Stock Exchange July this year. As you will remember, we are aiming for a long-term EBITDA margin of above 40%, and we are already at this level in the Norwegian and the Swedish operations, and we believe larger scale and more efficient operation will drive margin going forward. However, this is not going to be a straight line, as margins will depend on timing of new product launches, development of our platform consolidation program, various cost efficiency measures, and of course, our M&A activity. Let's turn to our M&A activities in the second quarter. We have completed 12 acquisitions since May 2019. The acquisitions in 2019 strengthened our Nordic presence and also gave us a foothold in Europe through the acquisition of the company EU Supply. In 2020, we broadened the scope into the post-award procure-to-pay market with four acquisitions and ended the year with the large acquisition of Visma Commerce in Sweden. This year, we made our first move in continental Europe with the acquisition of the Dutch pre-award buy-side market leader, Negometrix, in February, which was followed up by the acquisition of CTM Solutions in the same market in May. Within the post-award market, we acquired Ibistic in Denmark, also in May, and ending the M&A activity in the 2nd quarter by acquiring the clear Finnish market leader, Cloudia, in June. Cloudia was the final piece of the puzzle in the Nordics. The company gives us clear market leadership in Finnish public buyer market, and we are now the undisputed market leader across the entire Nordic region. The company has 558 buy-side customers, including 95 of the 100 largest Finnish municipalities and 10 of the largest cities. Just like the Negometrix acquisition earlier in the year, this follows a straightforward M&A playbook. With Cloudia, we get hold of the public buyers in Finland, and this leaves us the opportunity to develop the supplier side in Finland further, and also to cross-sell our post-award solutions to the public buyers. As I will get back to in a minute, we are currently rebuilding our supplier platform and start upgrading the first customers in Norway in Q3 this year, and then move on to other markets with Denmark as the first one. Fortunately, in Finland, we already have our existing supply-side product, which we will use as the foundation to build a supplier-side business in Finland already starting this autumn. Cloudia is growing healthily and increased their ARR by 13% from the year-end 2020 to EUR 9.9 million, with an EBT margin around 30% at the end of second quarter this year. To succeed with our M&A, we need to make sure that we manage to strengthen growth and improve margins in the companies we acquire. In this respect, it's obviously too early to talk about the development in Cloudia, but we have good examples from other acquisitions. We have earlier shown you the strong positive development in EU Supply's revenue and margins from the acquisition in 2019, and on our capital markets update in May, we showed you the first signs of improvement in Commerce after the acquisition last year. Visma Commerce experienced a pretty flat development for many years, and also through the first three quarters of 2020, showing ARR growth of only 2% from fourth quarter 2019 through the third quarter 2020. Our team has managed to revive the growth by implementing the Mercell way of sales and a strengthening of the sales team, and we have seen ARR grow by 10% over the past three q uarters, as you can see on this slide. Commerce is a large organization to move around, and although it will take some time to take out the full potential, we believe there is considerable further upside going forward. Moving on to our product and tech development. As we have shown you before, we provide workflow solutions for the full procurement life cycle, both in the pre-award phase from source-to-contract and in the post-award phase from purchase to pay. While the value chain on top describes the workflow processes from a buy-side perspective, we also cater to the suppliers with tender search and notifications and tender management solutions. Today, we service our customers from multiple different platforms, and our aim is to consolidate this into one common platform across all our markets. This is the way to both generate economies of scale on the revenue side and cost efficiency in the production and maintenance of our services. In the illustration you see at this slide, you can see the many different platforms we currently operate. We have our legacy Mercell platform, we have Visma Commerce's TendSign on the buy side and Opic on the supply side, Negometrix, Cloudia, and so on. The point of our ongoing platform consolidation process is to establish one overriding Mercell platform covering the entire value chain. Buyers and suppliers have different needs, and the post-award market requires other solutions than the pre-award market. On the pre-award buy side, we have chosen the newest version of the Negometrix platform, called NX4, as our new common platform in all markets. This platform is battle-tested and is currently in use in the Netherlands, in Bulgaria, and in the U.S. All buy-side customers in all current markets will, over time, be upgraded to this common Mercell platform, which we then name the Mercell Source-to-Contract platform. Work is progressing fast on all areas of this. We will actually start upgrading the first customers in Denmark already now in the third quarter 2021. More on this on the next slide as well. Regarding our supplier customers, they will be upgraded to a newly developed Mercell Tender finder platform, which will offer greatly improved functionality and user interface compared with today's solution. I'll get back to that in a minute as well. The platform has actually been soft-launched in Norway with first customers onboarded already. We will also follow up with Denmark after the Norwegian market. Further ahead, we believe this new platform will also enable us to build strong supply-side businesses in markets like the Netherlands. For Finland's part, we already have, as mentioned, the existing supply-side platform from Mercell, which we will build the offensive in Finland around, and at a later stage, we will upgrade all the Finnish customers to the new and improved Mercell Tender finder platform. Finally, we are currently working on enhancements of the Tricom platform, which will become our common best-of-breed Mercell procure-to-pay platform. Here, the plan is to start upgrading the first customers in Norway and Denmark in the first quarter next year. While the NX4 platform offers a very good starting point, it obviously needs to be localized to our other markets with different languages, adaptation to different publication services in the various countries, and so on. We also need to fill some feature gaps so that our customers can retain all functionality when upgrading to our Mercell source-to-contract common platform. These snapshots on this slide illustrate the ongoing localization efforts with the Danish and Norwegian languages being built into the platform alongside English and Dutch. We are also working to fill feature gaps to secure feature parity to the existing platforms, as well as technical enhancements and modularization of the platform. As I already said, we are beginning to onboard the first customers in Denmark in the third quarter, and we are starting with the less complex accounts before moving on to more complex public buyers with more advanced functionality. Norway and Sweden will follow soon after Denmark. As you can see from the snapshot on the right, Mercell Tender finder comes with a lot of new elegant features. It resembles the Google search, which is a known habit of use for our customers. The design is user-friendly and includes advanced search and filtering solutions, better tools for market surveillance, so our suppliers do not miss out on any opportunities, and an improved tender notification service across different devices. From the soft launch I mentioned that is ongoing now, we already see that it results in increased user interactions, higher engagement, and significant changes in search approach, moving from traditional EU industry codes, so-called CPV codes, and to dynamic keyword searches that improves relevance and hit ratios to relevant business opportunities for the suppliers. As we all know, any changes can be difficult even if they are good changes. That is why in a transition period, we will make sure that existing customers have a seamless access both to the new platform and also to the one they have been using until now. In this way, we remove all risks due to the fact that customers will be upgraded as a service within their existing contract and terms. They will also be able to buy access to completely new features, et cetera, going forward, since the new platform and its services will be further enhanced over time. What we ultimately are working towards is a large two-sided marketplace to match buyers and suppliers across all our geographies in both the pre-award and post-award markets. A larger and better integrated marketplace offering will allow for benefits beyond just the workflow systems as it will create increasing network effects that adds value for all parties. The more buyers and tenders we have on our platform, the more attractive the platform will be for different suppliers. And the more suppliers we have on the platform, the more competitive and efficient the tender and procurement processes become. With that, I'll leave the microphone to Fredrik to take you through the financials. Thank you, Terje. I'll start with the ARR development in the quarter, which overall showed an increase of NOK 136 million from the end of the previous quarter. Organic growth was NOK 15 million, with NOK 17 million from new sales and NOK 25 million from upselling. This was partially offset by NOK -19 million in churn and contraction. Net retention was hence positive in the quarter, excluding a negative currency effect of NOK 8 million. The three acquisitions in the quarter added NOK 122 million, measured at the time of the acquisition, with Cloudia being the largest with NOK 104 million at the end of June. Moving on to the P&L. We have already talked you through the top-line growth of 149%. Underlying operating costs increased in line, and the adjusted EBITDA margin also increased by 149% to NOK 47.7 million. Reported EBITDA was however significantly impacted by M&A costs and special items of NOK 50 million, which I'll get back to in more detail on the next slide. Further down, you see increased depreciation and amortization, which mainly reflects the acquisition and amortization of development costs. We also charged the result with impairments of NOK 15 million in Q2. This reflects previously capitalized costs for some modules that are being redundant, obsolete, or as a result of the ongoing platform consolidation process. Net financials were a NOK -64 million in the quarter after a NOK +59 million in the first quarter. Net interest expenses were relatively stable from the previous quarter, and the large swings mainly reflect unrealized gains and losses on our SEK-denominated debt. Breaking down the M&A costs and special items cost in the quarter, we see M&A cost of NOK 25 million split between NOK 11 million in due diligence, legal advisory, et cetera, and NOK 14 million in cross-border transfer tax for the shares in Cloudia. Other special items included NOK 15 million in fees relating to a strategy project and uplisting to the Oslo Stock Exchange, and close to NOK 9 million in provisions for earn-out related to the acquisitions. The earn-out provisions reflect one month of provisions, and similar provisions will be made for the remaining 11 months of the earn-out agreements. Cloudia accounts for NOK 8.5 million of the earn-out. This is a non-cash items, the earn-out will be settled in Mercell shares one year after completion of the transaction. Focusing on our technology development investments, we are running a rapid pace of innovation and product development, and capitalized R&D increased from NOK 34 million in Q1 to NOK 47 million in Q2. As we said in Q1, we plan for capitalized development costs of between NOK 160 million and NOK 180 million for the full year 2021, meaning that the CapEx spending is leveling off. We expect a similar absolute level in 2022, and given the increase in revenue, this means that the CapEx to revenue ratio will decline next year, and we expect that to continue down in the years to come. We are confident that our investments will improve both our revenue generation and cost efficiency going forward and support our long-term EBITDA margin targets. Operating cash flow was NOK 58 million in the first half of the year. As you can see, this was overshadowed by the cash impact of our investments in the period. Overall investments amounted to some NOK 1.2 billion in the period, accounting for the four investments and the increased capitalized R&D. We financed our investments with a share issue of NOK 434 million in February and another of NOK 400 million in connection with the Cloudia acquisition in June, plus a tap issue of SEK 500 million on our bond. The net effect, excluding prepayment of borrowings and the seller's credit and interests, was a little over NOK 1 billion. As a result, we ended Q2 with a cash balance of NOK 209 million. After the end of the quarter, we signed a NOK 100 million RCF with Danske Bank, which we have not yet drawn upon. This further strengthens our financial flexibility. Finally, a few comments on our balance sheet. This has obviously changed character over the past year with the many acquisitions we have completed. The kind of assets we have acquired are mostly intangible assets such as software development assets and goodwill. On the other side of the balance sheet, we see the increase in equity as a result of the share issues over the past year and increase in non-current liabilities, which is the SEK bond. The equity ratio is solid at 48%. As I mentioned, we had a cash position of NOK 209 million and net interest-bearing debt of NOK 1.45 billion. Our financial flexibility was further strengthened after the end of the quarter when we signed the NOK 100 million RCF with Danske Bank. We have not yet drawn upon the facility, which is for general purposes and financing of further possible acquisitions. Thank you. I'll hand the mic back to Terje for some closing remarks. Thank you, Fredrik. As we talked a lot about on our capital markets update in May, what we do is important. The total EU procurement market represents some EUR 2 trillion annually, or 14% of the average gross domestic product in the European countries. There are significant savings and efficiency gains to be harvested by deploying systems like ours. Authorities that have already made the transition to well-functioning e-procurement processes report savings both in time and money. If the cost saving in average should be at, let's say, 5%, this amounts to a potential saving across the EU of EUR 100 billion per year. The EU Commission highlights that digital procurement leads to simpler and more efficient processes with less red tape and administration. It also highlights that increased transparency and traceability reduces the risk of corruption, and that digital tools lead to greater innovation and improved access for small and medium-sized enterprises. We believe our businesses have a share in the success of the Nordic countries, which are all given the green light on EU's own procurement performance scoreboard. We also believe this shows that Europe holds great opportunities for Mercell going forward. At Q1, we also outlined our high ambitions for long-term growth, showing that we expect ARR in our existing markets by the end of 2020 to more than double until the year end of 2025. As the graph illustrates, we expect the supply side to drive the growth and are looking forward to see more and more effects of our gradual launch of the new and greatly improved supply side platform. We also see significant upside potential in establishing a supply side business in the Netherlands, and also to significantly increase the scale of the supply side operations in Finland with Cloudia's unrivaled buy-side market position as base. This will generate increasing network effects across all our markets. We have also outlined the large opportunity that lies in M&A and entry into new markets. The acquisition of Visma Commerce and Cloudia completed the Nordic consolidation phase, and the acquisition of Negometrix in the Netherlands marked the first venture into the continental part of Europe. We continue to hold high growth ambitions for European expansion, but having bought six companies over the past year, our main focus in the second half of this year will be on integration of the acquisitions and profitable growth in the existing businesses. Our long-term outlook remains the same, and our Q2 growth figures show that we are on track. With that, we will open up for questions. Thank you for listening in so far. At this point, we have already received some questions. We can see that some of them probably were written before the information was given in the presentation, so we will not repeat those. The first one we can answer is the question: Are the gross customer additions coming from old Mercell customers that come and leave the platform all the time? Since we have 26,000 paying customers on the supply side, as mentioned, and of course, on the supply side, we have some suppliers that leave us and come back. That's correct. Most of the growth we see come from new customers that experience the opportunities that lies within the public tendering contract opportunities. Most of the additions are new customers. We have a question that goes as: What is the risk that governments follow the Estonia policy and insource a lot of the capabilities provided by Mercell? We have been in this business for more than 20 years, and we see a clear pattern that in the Western part of Europe, this is not happening. Also the EU Commission, when they obtained the procurement regulations, made it very clear that this was a market, that the private actors, private players in the market should make sure that solutions were accessible for all the public buyers. The few examples we have in the Western part of Europe, we actually see the trend going the opposite way, that there are discussions now on shutting down state solutions. A few Western European countries has this, a good example is, in fact, the Netherlands, where we, as everyone knows, are the largest provider within the commercial part of the country. The state solutions in the Netherlands are, by many voices, recommended to be shut down by the government, and they will take a stand to that during the next one to two years. We have another question. How long-lasting is the upsell opportunity, and for how long can organic growth rely mostly on this? How do you top your paying customers compare with new customers per user? Maybe you, Fredrik, could give a general answer to that one. Yes. We have and are investing in product development. Our goal is to have one platform for our customers. We are conducting product development in a very iterative way where we try to focus on the customer journey and focus on the pain points on that customer journey and solve those pain points for our customers. That's an ongoing process. That's a process that we plan for many years. The answer to that is that we plan for organic growth in many years. Thank you. Next question. From an M&A perspective, can you explain the urgency to acquire more companies sooner than later? Why not digest the multiple deals done to date and understand whether the strategy works? Yes. This was one of the questions that I think we answered already in the presentation because as we said a couple of minutes ago, our main focus now in the second half will be to make sure that the post-merger integration of the companies we already acquired goes as planned, and also that we want to focus on making those acquired companies starting to really utilize the Mercell way of sales, and also to increase the profitability. M&A will not be the main focus going forward now. As we’ve shown you, related to the results already in the commerce business in Sweden, we see the result quite quickly from when we focus on our ways of doing the sales and marketing in a country. The next one, can you say something about the initial response of the search and discover product? We touched upon this also in the presentation. The Mercell Tender finder, which is the official name for the new supplier-side platform, has been received extremely well from the onboarded suppliers in Norway so far. As we also mentioned, we see that the usage of the platform is exactly what we were planning and hoping for, meaning that the customers spend time within the portal, they create their own search criteria, they find new business opportunities, et cetera. We also have already a few testimonials from users that this is really a positive revolution within the industry because they have never seen this type of modern Google-like search opportunities within the public procurement sector. So far everything is going according to plan. The next question is about Denmark, if we have launched the search and discovery product there. No, we have not, as mentioned in the presentation, because we will do the Norwegian market first, and then we will move on to Denmark. Let me see. A lot of questions. This one. With your organic ARR growth outlook over the coming years, what do you expect of Visma versus the 10% growth they have right now? We don't guide on specific companies in our portfolio. We have guided on an expected ARR growth in the years to come, throughout 2025. We expect all companies in our portfolio to contribute to that growth. Thank you, Fredrik. Yeah. We have a couple of other questions also related to the M&A activities. For instance, will you continue to acquire companies in Europe this year? As mentioned, our main focus now is to consolidate the already acquired companies, which also is going very well. Of course, we will have our, let's say, ears and eyes open for opportunities. Again, main focus is consolidation, growth, and profitability on the business that we now consist of in the group. I think we actually answered the questions that were new, that was not covered by the presentation. Do you agree, Fredrik? Yes, I think so. Yeah. All right. I think that's it. All that remains is to thank everyone for listening in and to wish you all a really great day further. Thank you from Fredrik and me.
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