EQS Group AG publishes annual report 2022

EQS Group AG publishes annual report 2022

Mark of 5,000 SaaS customers surpassed

• Revenue increase by 22 percent to EUR 61.43 million
• New ARR amounts to EUR 9.3 million
• Total number of SaaS customers increases by 1,044 to over 5,000
• EBITDA of EUR 4.57 million (previous year: EUR 1.74 million) below plan
• Medium-term target of EUR 130 million in revenues to be achieved 12 to 18 months later

Munich – 31 March 2023

EQS Group AG (ISIN: DE0005494165) continued its growth track in FY 2022 and generated revenue of EUR 61.43 million (previous year: EUR 50.22 million). The increase over the previous year is 22 percent. The company’s EBITDA increased significantly compared to the previous year (EUR 1.74 million) to EUR 4.57 million, but fell short of the expectations. The consolidated net loss for the year amounted to EUR -3.33 million. Earnings per share were EUR -.34.

The New ARR, which quantifies the new contractually agreed annually recurring revenue, came out at EUR 9.3 million (previous year: EUR 8.9 million). The number of new SaaS customers is 1,044. This means that the targets for the key figures of New Customers and New ARR were achieved in 2022, while revenue recognition and EBITDA fell short.

The German Whistleblower Protection Act was passed in the last session of the German lower house of Parliament, Bundestag, on 16 December 2022. Due to this late year decision, a large number of SaaS contracts, some of which had a high order volume, were forecast to only become revenue-effective in 2023. Furthermore, temporary budget cuts by customers in other areas also led to postponements of the start of contracts. In total, the deviation of approximately EUR 1.5 million from the planned revenue then led to the EBITDA target of EUR 6 million not being achieved.

The revenue growth in fiscal year 2022 results from the significant increase in sales of compliance cloud products, although there have been delays in the mandatory introduction of an internal reporting channels for companies in almost all member states of the European Union. For the whistleblower systems area, 865 new SaaS customers were acquired. This took the number of SaaS customers over the 5,000 mark to 5,054.

In the period from October to December, the Group generated revenues of EUR 16.46 million (+11%). EBITDA increased to EUR 2.02 million (previous year: EUR -531 thousand).

Segment development

In the Compliance segment, sales increased by 38 percent in FY 2022. In the Investor Relations segment, sales were 2 percent below the prior-year figure. This was due to the gloomy mood on the capital market. By contrast, annual recurring revenues at Group level developed encouragingly. The ratio rose from 85 percent to 88 percent.

Achim Weick, founder and CEO of EQS Group AG: “We have held our ground well in a difficult market environment in the financial year 2022 and further expanded our position as the leading European cloud provider for whistleblower systems. The delays in implementing the Whistleblower Directive into national laws do not change our long-term positive business outlook. Compliance and sustainability goals are not in question in the European Union and are anchored in our society through legislative initiatives. Our business model is therefore sustainable, future-proof and offers enormous growth opportunities.”

Medium-term target to be reached 12 to 18 months later

Unexpectedly, in its session on 10 February 2023, the upper house of the German parliament, Bundesrat, blocked the implementation of the EU Whistleblower Directive into German law. While 20 EU member states have in the meantime anchored whistleblower protection into their national laws, the delay for EQS Group AG in their important home market of Germany means a further delay in revenue recognition for customers who postpone their signing of contracts until the act enters into force. The medium-term goals can therefore no longer be achieved as planned. Now, EQS Group AG expects to achieve its medium-term target of EUR 130 million in revenue and an EBITDA margin of at least 30 percent with a delay of 12 to 18 months, in line with the delay of the legislation.

Outlook
Further growth in 2023

For the 2023 financial year, the Executive Board is planning an increase in revenue of 15 to 20 percent, equivalent to EUR 71 million to EUR 74 million. The EBITDA should be in a range of between EUR 9 million to EUR 11 million. For the key figure New ARR, which quantifies the new contractually agreed annually recurring revenue, the company expects a volume of EUR 9 million to EUR 12 million. In addition, 2,000 to 3,000 new customers are to be acquired, the majority of them in the product area of whistleblower systems. The outlook is based on the assessment that the EU Directive will be transposed into German legislation no later than during the course of the third quarter of 2023.

The Executive Board will be explaining the business results in a video conference at 11.00 a.m. (CEST). Dial-in is not necessary. It will be broadcast live online at EQS Webcast FY 2022. Questions can be asked using the Q&A feature (chat) beforehand or during the webcast.

 

Key figures (IFRS; in € mln.)	FY 2022	FY 2021	+/-
Revenues	61.431	50.223	22%
Operating Expenses	59.859	51.086	17%
EBITDA	4.567	1.742	>100%
Group Earnings	-3.332	-6.629	50%
Free Cash Flow	2.602	-97.641	>100%
Total Assets	189.373	186.837	1%
Cash & Cash Equivalents	10.655	8.653	23%
Net Debt	28.434	74.368	-62%
Equity-Ratio (%)	59	38	–

 

More information:

The figures for FY 2022 are audited.

EQS Group is a leading international cloud provider in the fields of corporate compliance, investor relations and ESG.

Working with EQS Group, thousands of companies worldwide inspire trust by fulfilling complex regulatory requirements in a reliable and secure manner, minimizing risks and communicating their business success and its impact on society and the climate transparently to stakeholders.

EQS Group’s products are pooled in the cloud-based software EQS COCKPIT. This platform ensures the professional handling of compliance workflows in the fields of whistleblower protection and case management, policy management, business approvals, third party management, insider list management and disclosure obligations.

Listed companies benefit from a global newswire, investor targeting and contact management, IR websites, digital reports and webcasts for efficient and secure investor communications.

In addition, EQS Group develops software for the management of ESG (environment, social,

governance) data, the fulfilment of human rights due diligence obligations along corporate

supply chains and for rule-compliant sustainability reporting.

EQS Group was founded in 2000 in Munich, Germany. Today the group employs around 600 professionals and has offices in the world’s key financial markets.

 

Contact:

André Marques

CFO

Tel.: +49 89-444430033

Mobile: +49 175-5250009

Email.: andre.marques@eqs.com