CM.com reports H1 2023 normalized EBITDA of -€ 3.7m, well within the given EBITDA guidance of -€3 to -€5m. Contributions to profitability in H1 2023 came mostly from high margin products in SaaS, Payments and Ticketing. Overall, gross profit grew 8% YoY and gross margins improved 1.9 percentages points to 27.8% in H1 2023. Total revenue H1 2023 was slightly higher YoY, offsetting COVID-related tailwinds in H1 2022. OPEX in H1 2023 was lower YoY and will decrease further in H2 2023. CM.com, therefore, expects normalized EBITDA to be positive over H2 2023.
BREDA, 25 JULY 2023
H1 2023 financial highlights
- Normalized EBITDA of -€3.7 million, before €0.8 million restructuring costs, well within guided EBITDA range for H1 2023;
- Gross profit grew by 8% YoY to €38.2 million, supported by SaaS +19%, Payments +11%, and Ticketing +31%;
- Gross margin improved by 1.9 percentage points to 27.8%;
- Revenue grew by 1% YoY to €137.3 million, supported by SaaS +19%, Payments +22%, and Ticketing +35%;
- In CPaaS, the increased gross profit on SMS messaging business replaced most of the COVID-related gross profit on Voice minutes in H1 2022, and resulted in a 3% decrease in revenue and gross profit YoY;
- Cost reduction is well underway, as OPEX before restructuring costs decreased YoY and will decrease further in H2 2023.
Q2 2023 financial highlights
- Gross profit grew by 11% YoY to €19.2 million;
- Gross margin increased by 2.5 percentage points YoY to 29.1%;
- Revenue grew by 1% YoY to €65.9 million.
Business highlights H1 2023
- CM.com launched Generative AI products for a first group of selected clients in the Travel - & E-commerce industry, enabling them to better interact with their audience;
- CM.com completed the setup with Visa and Mastercard and launched its in-house developed payment processing platform to give clients a better payments experience;
- CM.com sold more tickets than ever before in Ticketing.
Outlook
- CM.com expects normalized EBITDA to be positive over H2 2023 (upgraded from positive by year-end 2023);
- CM.com expects OPEX to further decrease in H2 2023 to reach -10% YoY for FY 2023, before restructuring cost;
- CM.com expects to be free-cash-flow positive by H2 2024 (upgraded from positive by year-end 2024).
Message from our CEO "The global adoption of new technology has never been as fast paced as Artificial Intelligence in the first six months of 2023. A new and exciting era is emerging. An era, CM.com has anticipated on with the acquisitions of CX Company and Building Blocks.
Ever since, AI has become the core of our proposition, as CM.com has been developing new applications to improve customer experience for our clients.
CM.com also recently announced the release of newly developed Generative AI applications for its client base in the Travel - and E-commerce industry. A selective group of clients from those sectors is now integrating these new developments into its marketing and sales setup. It is vital for our clients to integrate this technology into their setup, as it will improve their ability to serve their customers in the best possible way.
These technological developments come at a time where the world continues to face the threat of a recession, which affects the pace of growth in various markets. In the events sector, we notice that consumers' behavior has returned to a more normalized level after the strong recovery in 2022 following the end of the COVID lockdowns. It is therefore a strong signal that CM.com continues to grow its presence in the event business, as CM.com and Pukkelpop expand their cooperation and we expect to announce more news around our involvement with the Dutch Grand Prix soon.
The macro-economic developments cause a shift in priority with some of our clients towards client retention and cost optimization. CM.com's products and services help clients achieve those goals, as especially our SaaS solutions primarily cater to economic expansion and contraction. The shift in priority results in longer sales cycles and requires a partnership in knowledge sharing and reliability. Good examples are the partnerships CM.com has with big tech firms like Google, Microsoft and Salesforce.
In light of these market developments, we are pleased with the performance of CM.com in the first six months of this year. CM.com is on track to realize its goals and adapt the organization to the changing world as we realign sales capacity and rationalize headcount to drive incremental profitability improvements. This focus on profitability led to the reduction in number of global offices to 19, as CM.com decided to close its local offices in Kenia and Mexico. Our improved performance in higher margins products and regions, while controlling our OPEX, resulted in a normalized EBITDA well within the guided range for the first half of 2023.
As a result, our OPEX and FTE levels decreased below levels in H1 2022 for the first time. This decrease is set to accelerate in H2 2023, as we will continue to realign global sales capacity to drive our profits. CM.com therefore expects its FY 2023 OPEX to be at least 10% lower YoY.
These measures will result in a future-proof CM.com. In this process, we will continue to underline the importance of initiatives such as our Talent Program and Female Leadership sequences. CM.com reiterates its commitment to finding the right balance between capabilities and opportunities within our workforce, independent of gender, age, or origin.
Considering everything, CM.com now expects normalized EBITDA to be structurally positive in the second half of 2023, sooner than expected. We expect our FY 2023 OPEX to be at least 10% lower YoY and following all this, CM.com expects to be structurally free-cash-flow positive in H2 2024, also sooner than expected.
CM.com strives to reach those goals, as this will enable CM.com to monetize future opportunities better."
Jeroen van Glabbeek
CEO CM.com
BREDA, 25 JULY 2023
H1 2023 financial highlights
- Normalized EBITDA of -€3.7 million, before €0.8 million restructuring costs, well within guided EBITDA range for H1 2023;
- Gross profit grew by 8% YoY to €38.2 million, supported by SaaS +19%, Payments +11%, and Ticketing +31%;
- Gross margin improved by 1.9 percentage points to 27.8%;
- Revenue grew by 1% YoY to €137.3 million, supported by SaaS +19%, Payments +22%, and Ticketing +35%;
- In CPaaS, the increased gross profit on SMS messaging business replaced most of the COVID-related gross profit on Voice minutes in H1 2022, and resulted in a 3% decrease in revenue and gross profit YoY;
- Cost reduction is well underway, as OPEX before restructuring costs decreased YoY and will decrease further in H2 2023.
Q2 2023 financial highlights
- Gross profit grew by 11% YoY to €19.2 million;
- Gross margin increased by 2.5 percentage points YoY to 29.1%;
- Revenue grew by 1% YoY to €65.9 million.
Business highlights H1 2023
- CM.com launched Generative AI products for a first group of selected clients in the Travel - & E-commerce industry, enabling them to better interact with their audience;
- CM.com completed the setup with Visa and Mastercard and launched its in-house developed payment processing platform to give clients a better payments experience;
- CM.com sold more tickets than ever before in Ticketing.
Outlook
- CM.com expects normalized EBITDA to be positive over H2 2023 (upgraded from positive by year-end 2023);
- CM.com expects OPEX to further decrease in H2 2023 to reach -10% YoY for FY 2023, before restructuring cost;
- CM.com expects to be free-cash-flow positive by H2 2024 (upgraded from positive by year-end 2024).
Message from our CEO "The global adoption of new technology has never been as fast paced as Artificial Intelligence in the first six months of 2023. A new and exciting era is emerging. An era, CM.com has anticipated on with the acquisitions of CX Company and Building Blocks.
Ever since, AI has become the core of our proposition, as CM.com has been developing new applications to improve customer experience for our clients.
CM.com also recently announced the release of newly developed Generative AI applications for its client base in the Travel - and E-commerce industry. A selective group of clients from those sectors is now integrating these new developments into its marketing and sales setup. It is vital for our clients to integrate this technology into their setup, as it will improve their ability to serve their customers in the best possible way.
These technological developments come at a time where the world continues to face the threat of a recession, which affects the pace of growth in various markets. In the events sector, we notice that consumers' behavior has returned to a more normalized level after the strong recovery in 2022 following the end of the COVID lockdowns. It is therefore a strong signal that CM.com continues to grow its presence in the event business, as CM.com and Pukkelpop expand their cooperation and we expect to announce more news around our involvement with the Dutch Grand Prix soon.
The macro-economic developments cause a shift in priority with some of our clients towards client retention and cost optimization. CM.com's products and services help clients achieve those goals, as especially our SaaS solutions primarily cater to economic expansion and contraction. The shift in priority results in longer sales cycles and requires a partnership in knowledge sharing and reliability. Good examples are the partnerships CM.com has with big tech firms like Google, Microsoft and Salesforce.
In light of these market developments, we are pleased with the performance of CM.com in the first six months of this year. CM.com is on track to realize its goals and adapt the organization to the changing world as we realign sales capacity and rationalize headcount to drive incremental profitability improvements. This focus on profitability led to the reduction in number of global offices to 19, as CM.com decided to close its local offices in Kenia and Mexico. Our improved performance in higher margins products and regions, while controlling our OPEX, resulted in a normalized EBITDA well within the guided range for the first half of 2023.
As a result, our OPEX and FTE levels decreased below levels in H1 2022 for the first time. This decrease is set to accelerate in H2 2023, as we will continue to realign global sales capacity to drive our profits. CM.com therefore expects its FY 2023 OPEX to be at least 10% lower YoY.
These measures will result in a future-proof CM.com. In this process, we will continue to underline the importance of initiatives such as our Talent Program and Female Leadership sequences. CM.com reiterates its commitment to finding the right balance between capabilities and opportunities within our workforce, independent of gender, age, or origin.
Considering everything, CM.com now expects normalized EBITDA to be structurally positive in the second half of 2023, sooner than expected. We expect our FY 2023 OPEX to be at least 10% lower YoY and following all this, CM.com expects to be structurally free-cash-flow positive in H2 2024, also sooner than expected.
CM.com strives to reach those goals, as this will enable CM.com to monetize future opportunities better."
Jeroen van Glabbeek
CEO CM.com
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