Konsolidator Lowers Expectations for 2024
Konsolidator has made an important announcement regarding expectations for the year 2024. The company reported a net growth in Annual Recurring Revenue (ARR) of only DKK 0.2 million, resulting in an ARR of DKK 19.6 million by mid-2024. This lower-than-expected growth is attributed to fewer new sales and reduced upsales to larger customers.
Revised Financial Outlook
As a result of the slower growth, Konsolidator has lowered its ARR forecast for 2024 to DKK 21-23 million from a previous estimate of DKK 24-28 million. Correspondingly, the revenue outlook has been revised down to DKK 21-23 million from DKK 23-27 million. The EBIT loss for 2024 is now estimated to be between DKK 10-12 million, an adjustment from the previously guided loss of DKK 0-5 million. This revision takes into account the company's investment in Konsolidator Iberia, which amounts to DKK 1-2 million.
Challenges in International Sales
Despite satisfactory sales performance within Denmark, Konsolidator faces challenges with international sales. The sales cycle and decision-making processes have become lengthier than expected, contributing to the slower growth in both new sales and ARR. In the first half of 2024, the company recorded new sales and ARR upsales of DKK 1.2 million, resulting in the net growth of ARR.
Impact of Market Conditions
The revised financial outlook is a response to both growth opportunities from existing business and potential new sales opportunities, including the recently introduced Konsolidator Banking application. However, the impact of these new sales opportunities has been delayed due to the uncertain geopolitical climate, leading Konsolidator to caution about any short-term improvements in the sales landscape.
Cost Reduction Initiatives
To address these challenges and enhance customer acquisition, Konsolidator has implemented several cost reduction initiatives. The workforce was reduced from 36 employees to 30 by the end of August 2024, and digital marketing efforts will now be outsourced. The financial impact of these changes is expected to be seen starting in Q1 2025. Additionally, in Q4 2024, Konsolidator plans to launch a new three-year strategic plan aiming to further reduce churn by offering two-year contracts starting from Q2 2024.
Success in Iberia
Konsolidator Software Iberia S.L. commenced operations in Q2 2024 and has already signed two customers, exceeding initial expectations. However, the investment in the Iberian market is projected to negatively impact EBIT by DKK 1-2 million in 2024.
Adjusted Guidance for 2024
The financial expectations for 2024 have been adjusted as follows:
- ARR of DKK 21-23 million
- Revenue of DKK 21-23 million
- EBIT loss of DKK 10-12 million
Furthermore, the adjusted guidance on other SaaS metrics for 2024 includes:
- CAC/new ARR of 40-60 months (previously 25-30 months)
- Net ARR increase/Cash Burn above 0.1-0.3 times (previously 0.5 times)
- Net retention of 93-98% (previously 99-101%)
- Churn of 10-12% (previously 8-10%)
The half-year report will be released soon, and the company plans to hold an investor webinar to discuss these updates and future expectations.
Contact Information
For more information, the following contacts are available:
- CEO: Claus Finderup Grove, mobile +45 2095 2988, cfg@konsolidator.com
- CFO: Jack Skov, mobile, +45 2282 8845, js@konsolidator.com
About Konsolidator
Konsolidator A/S offers financial consolidation software aimed at enhancing the capabilities of Group CFOs worldwide via automated financial consolidation and cloud reporting. Founded by financial professionals and leveraging innovative technology, Konsolidator simplifies financial consolidation processes, empowering CFOs with key performance insights to support strategic decision-making. The company was listed on the Nasdaq First North Growth Market Denmark in 2019 under the ticker code KONSOL.
Frequently Asked Questions
What is Konsolidator's revised ARR expectation for 2024?
Konsolidator has lowered its ARR expectation to DKK 21-23 million for 2024.
What challenges is Konsolidator facing in international sales?
Challenges include longer sales cycles and decision-making processes, which have impacted growth.
How has Konsolidator responded to the slow growth?
The company has implemented cost reduction strategies, including workforce reductions and outsourcing digital marketing.
What is the expected impact of Konsolidator Iberia?
Konsolidator Iberia is expected to have a negative EBIT impact of DKK 1-2 million in 2024.
When will the half-year report be released?
The half-year report is scheduled to be released in the near future, with a webinar to discuss updates.
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