Board Change • 2h
Less than half of directors are independent No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 2 experienced directors. 1 highly experienced director. 1 independent director (2 non-independent directors). Chairman of the Board Thomas Edselius was the last director to join the board, commencing their role in 2018. The following issues are considered to be risks according to the Simply Wall St Risk Model: Minority of independent directors. Insufficient board refreshment. New Risk • Oct 14
New major risk - Revenue and earnings growth Earnings have declined by 26% per year over the past 5 years. This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are declining over an extended period, then in most cases the share price will decline over time unless the company can turn around its fortunes. A trend of falling earnings can be very difficult to turn around. If the company is well already established it may also be a sign the company has matured and is in decline. In addition, if the company pays dividends it will also likely need to reduce or cut them, striking a dual blow to total shareholder returns. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (24% average weekly change). Earnings have declined by 26% per year over the past 5 years. Revenue is less than US$1m (kr8.3m revenue, or US$792k). Market cap is less than US$10m (kr13.4m market cap, or US$1.29m). Minor Risk Shareholders have been diluted in the past year (19% increase in shares outstanding). Reported Earnings • Oct 14
Third quarter 2024 earnings released: kr0.01 loss per share (vs kr0 in 3Q 2023) Third quarter 2024 results: kr0.01 loss per share (further deteriorated from kr0 in 3Q 2023). Revenue: kr1.37m (down 17% from 3Q 2023). Net loss: kr703.3k (down kr736.5k from profit in 3Q 2023). Over the last 3 years on average, the company's share price growth rate has exceeded its earnings growth rate by 85 percentage points per year, which is a significant difference in performance. New Risk • May 28
New major risk - Share price stability The company's share price has been highly volatile over the past 3 months. It is more volatile than 90% of Swedish stocks, typically moving 13% a week. This is considered a major risk. Share price volatility increases the risk of potential losses in the short-term as the stock tends to have larger drops in price more frequently than other stocks. It may also indicate the stock is highly sensitive to market conditions or economic conditions rather than being sensitive to its own business performance, which may also be inconsistent. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (13% average weekly change). Revenue is less than US$1m (kr6.6m revenue, or US$623k). Market cap is less than US$10m (kr6.96m market cap, or US$660.4k). Minor Risks Latest financial reports are more than 6 months old (reported September 2023 fiscal period end). Shareholders have been diluted in the past year (19% increase in shares outstanding). New Risk • May 14
New minor risk - Financial data availability The company's latest financial reports are more than 6 months old. Last reported fiscal period ended September 2023. This is considered a minor risk. If the company has not reported its earnings on time, it may have been delayed due to audit problems or it may be finding it difficult to reconcile its accounts. Currently, the following risks have been identified for the company: Major Risks Revenue is less than US$1m (kr6.6m revenue, or US$605k). Market cap is less than US$10m (kr7.28m market cap, or US$670.4k). Minor Risks Latest financial reports are more than 6 months old (reported September 2023 fiscal period end). Share price has been volatile over the past 3 months (11% average weekly change). Shareholders have been diluted in the past year (19% increase in shares outstanding). New Risk • Dec 03
New minor risk - Shareholder dilution The company's shareholders have been diluted in the past year. Increase in shares outstanding: 19% This is considered a minor risk. Shareholder dilution occurs when there is an increase in the number of shares on issue that is not proportionally distributed between all shareholders. Often due to the company raising equity capital or some options being converted into stock. All else being equal, if there are more shares outstanding then each existing share will be entitled to a lower proportion of the company's total earnings, thus reducing earnings per share (EPS). While dilution might not always result in lower EPS (like if the company is using the capital to fund an EPS accretive acquisition) in a lot cases it does, along with lower dividends per share and less voting power at shareholder meetings. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (20% average weekly change). Revenue is less than US$1m (kr6.8m revenue, or US$656k). Market cap is less than US$10m (kr7.20m market cap, or US$693.8k). Minor Risks Profit margins are more than 30% lower than last year (1.3% net profit margin). Shareholders have been diluted in the past year (19% increase in shares outstanding). New Risk • Sep 14
New minor risk - Profit margin trend The company's profit margins are lower than last year and have reduced by more than 30%. Net profit margin: 1.2% Last year net profit margin: 2.3% This is considered a minor risk. A large drop in profit margin could indicate the company does not have strong competitive advantages or it is yet to establish itself and its core business. Even if it is a well established business, this may make it a much riskier investment than one that has a combination of proven competitive advantages and a stable or growing profit margin. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (17% average weekly change). Revenue is less than US$1m (kr6.9m revenue, or US$617k). Market cap is less than US$10m (kr8.22m market cap, or US$738.4k). Minor Risk Profit margins are more than 30% lower than last year (1.2% net profit margin). Board Change • Nov 16
No independent directors No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 4 experienced directors. No highly experienced directors. No independent directors (4 non-independent directors). Chairman of the board Thomas Edselius was the last director to join the board, commencing their role in 2018. The following issues are considered to be risks according to the Simply Wall St Risk Model: Lack of independent directors. Insufficient board refreshment. Reported Earnings • Nov 03
Third quarter 2022 earnings released Third quarter 2022 results: Revenue: kr2.10m (up 10% from 3Q 2021). Net income: kr423.6k (up kr401.3k from 3Q 2021). Profit margin: 20% (up from 1.2% in 3Q 2021). The increase in margin was primarily driven by lower expenses. Over the last 3 years on average, earnings per share has increased by 99% per year but the company’s share price has only increased by 3% per year, which means it is significantly lagging earnings growth. Reported Earnings • Aug 28
Second quarter 2022 earnings released Second quarter 2022 results: Revenue: kr1.95m (down 1.1% from 2Q 2021). Net income: kr209.0k (up 210% from 2Q 2021). Profit margin: 11% (up from 3.4% in 2Q 2021). The increase in margin was driven by lower expenses. Reported Earnings • May 02
First quarter 2022 earnings released First quarter 2022 results: Revenue: kr1.84m (up 9.5% from 1Q 2021). Net income: kr64.1k (up 24% from 1Q 2021). Profit margin: 3.5% (up from 3.1% in 1Q 2021). The increase in margin was driven by higher revenue. Board Change • Apr 27
No independent directors No new directors have joined the board in the last 3 years. The company's board is composed of: No new directors. 4 experienced directors. No highly experienced directors. No independent directors (4 non-independent directors). Chairman of the board Thomas Edselius was the last director to join the board, commencing their role in 2018. The following issues are considered to be risks according to the Simply Wall St Risk Model: Lack of independent directors. Insufficient board refreshment. Reported Earnings • Feb 28
Full year 2021 earnings: Revenues and EPS in line with analyst expectations Full year 2021 results: EPS: kr0 (vs kr0 in FY 2020). Revenue: kr7.25m (up 17% from FY 2020). Net income: kr18.3k (up kr15.8k from FY 2020). Profit margin: 0.3% (up from 0% in FY 2020). The increase in margin was driven by higher revenue. Revenue was in line with analyst estimates. Earnings per share (EPS) were also in line with analyst estimates. Over the last 3 years on average, earnings per share has increased by 135% per year but the company’s share price has only increased by 5% per year, which means it is significantly lagging earnings growth. Reported Earnings • Aug 29
Second quarter 2021 earnings released The company reported a mediocre second quarter result with weaker earnings and profit margins, although revenues improved. Second quarter 2021 results: Revenue: kr1.98m (up 46% from 2Q 2020). Net income: kr67.5k (down 20% from 2Q 2020). Profit margin: 3.4% (down from 6.2% in 2Q 2020). The decrease in margin was driven by higher expenses. Over the last 3 years on average, earnings per share has increased by 128% per year but the company’s share price has only increased by 1% per year, which means it is significantly lagging earnings growth. Reported Earnings • May 02
First quarter 2021 earnings released The company reported a strong first quarter result with improved earnings, revenues and profit margins. First quarter 2021 results: Revenue: kr1.69m (up 4.8% from 1Q 2020). Net income: kr51.9k (up 239% from 1Q 2020). Profit margin: 3.1% (up from 0.9% in 1Q 2020). The increase in margin was driven by higher revenue. Over the last 3 years on average, earnings per share has increased by 118% per year but the company’s share price has fallen by 5% per year, which means it is significantly lagging earnings. Is New 90 Day High Low • Feb 12
New 90-day high: kr0.24 The company is up 44% from its price of kr0.16 on 13 November 2020. The Swedish market is up 10.0% over the last 90 days, indicating the company outperformed over that time. It also outperformed the Software industry, which is up 35% over the same period.