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StrongPoint

StrongPoint

Retail technology solutions

StrongPoint is a retail technology company that sells a wide variety of technology solutions that save costs, increase productivity, reduce theft or facilitate e-commerce sales for retailers. Its product portfolio includes electronic shelf labels, cash management systems, self-checkout terminals, click & collect lockers and digital e-commerce solutions. In addition, it holds strong positions in security cases for cash-in-transit and in adhesive labels. The company has strong positions in Norway, Sweden and the Baltics and is targeting to grow significantly in Spain.

The retail technology market is growing healthily, driven by e-commerce and a tough competitive landscape, forcing retailers to adopt new technology solutions to remain competitive. For StrongPoint, this creates a double opportunity: 1) StrongPoint delivers technology solutions that help retailers improve efficiency, and 2) StrongPoint sells e-commerce solutions to physical retailers that have their own online offerings. StrongPoint has a solid potential for future growth in Spain, which is a large and fragmented market and where the cash share is very high at 87%.

StrongPoint’s earnings are to some degree dependent on large product orders. If StrongPoint is unable to win large contracts from new or existing customers, it could pose a risk to its future sales and earnings growth. The Nordic grocery retail market is highly concentrated and several of these large chains are StrongPoint customers. Losing one of these customers could result in a significant loss of repeat business for StrongPoint. As there are some competing products, StrongPoint could be exposed to price pressure from new or existing competitors. Other risk factors include FX, macroeconomy, warranty issues and regulatory risks.

NOKm 2021 2022e 2023e
Sales 981 1345 1557
Sales growth (%) -17 37 15,8
EBITDA 54 70 122
EBITDA margin (%) 5,5 5,2 7,8
EBIT adj 42 40 83
EBIT adj margin (%) 4,2 2,9 5,3
Pretax profit 26 37 80
EPS rep 4,3 0,67 1,4
EPS growth (%) 95,3 -84,4 108,4
EPS adj 0,82 0,84 1,57
DPS 0,8 0,8 0,85
EV/EBITDA (x) 19,1 12,7 7
EV/EBIT adj (x) 24,7 22,6 10,4
P/E (x) 6 28,1 13,5
P/E adj (x) 31,5 22,3 12
EV/sales (x) 1 0,7 0,6
FCF yield (%) 36,1 -14,7 10,5
Dividend yield (%) 3,1 4,3 4,5
Net IB debt/EBITDA -2,2 0,8 0,2
Lease adj. FCF yield (%) 36,1 -14,7 10,5
Lease adj. ND/EBITDA -2,3 0,2 -0,1
NOKm 2021 2022e 2023e
Sales 981 1345 1557
COGS -560 -811 -912
Gross profit 421 534 646
Other operating items -368 -463 -524
EBITDA 54 70 122
Depreciation on tangibles -39 -36 -30
Depreciation on intangibles 0 0 0
EBITA 28 41 93
Goodwill impairment charges 0 0 0
Other impairment and amortisation -14 -10 -9
EBIT 28 36 83
Other financial items 1 43 0
Net financial items -2 1 -2
Associated income 0 0 0
Other EO items 0 0 0
Pretax profit 26 37 80
Tax -4 -7 -18
Net profit 22 30 63
Minority interest 0 0 0
Net profit discontinued 168 0 0
Net profit to shareholders 191 30 63
EPS 4,3 0,67 1,4
EPS Adj 0,82 0,84 1,57
Total extraordinary items after tax -14 -4 0
Tax rate (%) -13,7 -18,8 -22
Gross margin (%) 42,9 39,7 41,5
EBITDA margin (%) 5,5 5,2 7,8
EBITA margin (%) 2,8 3,1 5,9
EBIT margin (%) 2,8 2,6 5,3
Pretax margin (%) 2,6 2,8 5,2
Net margin (%) 2,3 2,2 4
Growth rates Y/Y 2021 2022 2023
Sales growth (%) -17 37 15,8
EBITDA growth (%) -64,8 31,3 73,6
EBIT growth (%) -68,2 29,5 131,7
Net profit growth (%) -62 34,5 108,4
EPS growth (%) 95,3 -84,4 108,4
Profitability 2021 2022 2023
ROE (%) 44,1 5,9 11,8
ROE Adj (%) 8,4 7,9 13,7
ROCE (%) 5,3 6,2 13,6
ROCE Adj(%) 8 7,9 15,3
ROIC (%) 6,1 6 11,2
ROIC Adj (%) 9,2 6,7 11,2
Adj earnings numbers 2021 2022 2023
EBITDA Adj 68 74 122
EBITDA Adj margin (%) 6,9 5,5 7,8
EBITA Adj 42 45 93
EBITA Adj margin (%) 4,2 3,4 5,9
EBIT Adj 42 40 83
EBIT Adj margin (%) 4,2 2,9 5,3
Pretax profit Adj 40 47 90
Net profit Adj 36 40 73
Net profit to shareholders Adj 36 40 73
Net Adj margin (%) 3,7 3 4,7
Depreciation and amortisation -25 -29 -30
Of which leasing depreciation -13 -17 -17
EO items -14 -4 0
Impairment and PPA amortisation 0 -6 -10
EBITDA lease Adj 68 74 122
EBITDA lease Adj margin (%) 6,9 5,5 7,8
Leasing payments 0 0 0
NOKm 2021 2022e 2023e
EBITDA 54 70 122
Net financial items -2 1 -2
Paid tax -4 -7 -18
Non-cash items 0 0 0
Cash flow before change in WC 48 65 102
Change in WC 177 -113 -8
Operating cash flow 225 -48 94
CAPEX tangible fixed assets -9 -9 -5
CAPEX intangible fixed assets 0 0 0
Acquisitions and disposals 197 -66 0
Free cash flow 414 -123 89
Dividend paid -31 -35 -36
Share issues and buybacks -14 -1 0
Other non cash items -227 -44 -17
Decrease in net IB debt -48 64 22
Balance Sheet (NOKm) 2021 2022 2023
Goodwill 125 160 160
Indefinite intangible assets 47 43 34
Definite intangible assets 0 0 0
Tangible fixed assets 19 25 25
Other fixed assets 7 2 2
Fixed assets 255 333 316
Inventories 211 251 253
Receivables 176 333 349
Other current assets 31 35 35
Cash and liquid assets 174 17 52
Total assets 847 969 1005
Shareholders equity 498 519 545
Minority 0 0 0
Total equity 498 519 545
Long-term debt 11 12 12
Pension debt 0 0 0
Convertible debt 0 0 0
Deferred tax 0 0 0
Other long-term liabilities 4 5 5
Short-term debt 5 23 23
Accounts payable 114 171 180
Other current liabilities 168 178 178
Total liabilities and equity 847 969 1005
Net IB debt -116 58 23
Net IB debt excl. pension debt -116 58 23
Capital invested 382 577 568
Working capital 136 270 278
EV breakdown 2021 2022 2023
Market cap. diluted (m) 1145 844 844
Net IB debt Adj -116 58 23
Market value of minority 0 0 0
Reversal of shares and participations -5 -5 -5
Reversal of conv. debt assumed equity 0 0 0
EV 1024 897 861
Capital efficiency (%) 2021 2022 2023
Total assets turnover (%) 120,2 148,1 157,8
Capital invested turnover (%) 312,7 293,8 280,2
Capital employed turnover (%) 295,3 251,3 222,5
Inventories / sales (%) 12 13,1 14,8
Customer advances / sales (%) 0 0 0
Payables / sales (%) 6,8 8,5 11
Working capital / sales (%) 11,3 15,1 17,6
Financial risk and debt service 2021 2022 2023
Net debt / equity (%) -23,3 11,2 4,2
Net debt / market cap (%) -9 6,9 2,7
Equity ratio (%) 58,9 53,5 54,3
Net IB debt adj. / equity (%) -23,3 11,2 4,2
Current ratio (%) 195,6 164,3 173,9
EBITDA / net interest (%) 3341,1 -5017,8 5637,9
Net IB debt / EBITDA (%) -216,6 82,7 18,6
Interest cover (%) 1713,6 -2958 4272,9
Lease liability amortisation 0 0 0
Other intangible assets 30 84 67
Right-of-use asset 43 40 40
Total other fixed assets 38 24 24
Leasing liability 42 40 40
Total other long-term liabilities 9 27 27
Net IB debt excl. leasing -158 18 -17
Net IB debt / EBITDA lease Adj (%) -233,9 24,5 -14,1
NOKm 2021 2022e 2023e
Shares outstanding adj. 44 45 45
Fully diluted shares Adj 44 45 45
EPS 4,3 0,67 1,4
Dividend per share Adj 0,8 0,8 0,9
EPS Adj 0,82 0,84 1,57
BVPS 11,23 11,55 12,15
BVPS Adj 7,73 6,12 7,1
Net IB debt / share -2,6 1,3 0,5
Share price 29,18 18,8 18,8
Market cap. (m) 1295 844 844
Valuation 2021 2022 2023
P/E 6 28,1 13,5
EV/sales 1,04 0,67 0,55
EV/EBITDA 19,1 12,7 7
EV/EBITA 37,2 21,6 9,3
EV/EBIT 37,2 25,2 10,4
Dividend yield (%) 3,1 4,3 4,5
FCF yield (%) 36,1 -14,7 10,5
P/BVPS 2,3 1,63 1,55
P/BVPS Adj 3,34 3,07 2,65
P/E Adj 31,5 22,3 12
EV/EBITDA Adj 15,1 12,1 7
EV/EBITA Adj 24,7 19,7 9,3
EV/EBIT Adj 24,7 22,6 10,4
EV/cap. employed 1,8 1,5 1,4
Investment ratios 2021 2022 2023
Capex / sales 0,9 0,7 0,3
Capex / depreciation 72,2 77,2 41,7
Capex tangibles / tangible fixed assets 46,2 36,1 19,9
Capex intangibles / definite intangibles 0 0 0
Depreciation on intangibles / definite intangibles 24,9 8,3 10,6
Depreciation on tangibles / tangibles 24,2 19,3 19,9
Lease adj. FCF yield (%) 36,1 -14,7 10,5

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Media

StrongPoint - Company presentation with CEO Jacob Tveraabak
StrongPoint - Company presentation with CEO Jacob Tveraabak

Main Shareholders - Strongpoint

Main shareholders Share capital % Voting shares % Verified
Strømstangen AS 8.8 % 8.8 % 10 Aug 2022
Nordnet Bank AB 6.0 % 6.0 % 10 Aug 2022
Sole Active AS 4.9 % 4.9 % 10 Aug 2022
Canaccord Genuity Wealth Management 4.5 % 4.5 % 30 Apr 2022
V. Eiendom Holding AS 4.2 % 4.2 % 10 Aug 2022
Quaero Capital S.A 3.2 % 3.2 % 31 Jan 2022
Nordnet Pensionsförsäkring 3.2 % 3.2 % 31 Jul 2021
Avanza Bank AB 2.8 % 2.8 % 10 Aug 2022
Jan Ring 2.6 % 2.6 % 10 Aug 2022
Georg Zetterberg 2.5 % 2.5 % 31 Jul 2021
Source: Holdings by Modular Finance AB