EEZY PLC -- INTERIM REPORT -- 5 NOVEMBER 2024 AT 8:00
Eezy Plc's Interim Report 1-9/2024: Actions to improve profitability progressed in a difficult market situation
July-September 2024
- Revenue was EUR 44.9 million (EUR 56.0 million in July-September 2023). Revenue decreased by 20%.
- EBITDA was EUR 3.3 million (4.4).
- EBIT was EUR 1.1 million (2.3) and was 2.5% of revenue (4.1%).
- The result includes EUR 0.4 million (0.0) in personnel expenses related to severance payments, of which EUR 0.2 million is related to the renewal of operating model. In addition, EUR 0.6 million (0.0) in other one-time costs related to the renewal of operating model were recorded in the result.
- Earnings per share was EUR 0.02 (0.05).
- AI-powered ERP system development is progressing according to plan.
- The steps to renew the operating model have been quickly moved forward in accordance with our strategy. The goal is to create an operationally efficient, competitive and scalable operating model.
January-September 2024
- Revenue was EUR 132.1 million (EUR 166.8 million in January-September 2023). Revenue decreased by 21%.
- EBITDA was EUR 8.0 million (11.0).
- EBIT was EUR 2.2 million (4.7) and was 1.7% of revenue (2.8%).
- EUR 0.8 million (0.4) in personnel expenses related to severance payments and EUR 0.6 million (0.0) in other one-time costs related to the renewal of operating model were recorded in the result.
- Earnings per share was EUR 0.02 (0.08).
- Staffing services ERP in limited production use in April.
- In June, Eezy launched the next phase in the renewal of operating models aimed at creating an efficient, competitive and scalable way of working for growth. The steps have been carried forward quickly in accordance with our strategy.
Outlook for 2024
Eezy does not give guidance for 2024.
Key figures (IFRS)
| EUR million, unless otherwise specified | 7-9/2024 | 7-9/2023 | 1-9/2024 | 1-9/2023 | 1-12/2023 |
| Revenue | 44.9 | 56.0 | 132.1 | 166.8 | 219.0 |
| EBITDA | 3.3 | 4.4 | 8.0 | 11.0 | 14.5 |
| EBITDA, % | 7.4% | 7.9% | 6.0% | 6.6% | 6.6% |
| EBIT | 1.1 | 2.3 | 2.2 | 4.7 | 4.0 |
| EBIT, % | 2.5% | 4.1% | 1.7% | 2.8% | 1.8% |
| EPS, basic, EUR | 0.02 | 0.05 | 0.02 | 0.08 | 0.03 |
| EPS, diluted, EUR | 0.02 | 0.05 | 0.02 | 0.08 | 0.03 |
| Net debt / EBITDA | - | - | 5.0 x | 3.5 x | 4.0 x |
| Chain-wide revenue | 66.5 | 78.9 | 193.9 | 233.9 | 307.6 |
Siina Saksi, CEO:
"In the third quarter of the year, we have rapidly implemented measures in line with our strategy, which will permanently lower our cost level and enable scalable growth. Demand has continued to be subdued during the third quarter in our Staffing Services business area. Economic uncertainty has also delayed our customers' purchasing decisions in our Professional Services business area.
Our revenue in the third quarter was EUR 44.9 million (56.0). The main reason for the decline in revenue continued to be weak demand in Staffing. Revenue in Staffing fell by 21% compared to the same period last year. The decline in demand was seen in every sector. Construction and industry continued to contract the most. In Southern Finland the decline in demand has been smaller. The total staffing market declined by 8.7% in January-August (vs. 2023. source: HELA).
In the third quarter, the Professional Services business area generated revenues of EUR 5.4 million (6.0), which we consider a reasonable achievement in a difficult economic environment. The weak economy has reduced demand for headhunting and organisational development services, and decision making has been delayed in our client organisations. There is demand for personnel assessments and transition security services.
EBIT in the third quarter was EUR 1.1 million (2.3), 1.1% of revenue. The decline in EBIT is due to the fall in revenue and one-time costs. Measures under our profitability programme have progressed and reduced our cost level compared to last year.
Transformation of our operating models well underway
We have made good progress in the third quarter in transformation of our operating models. The impact of these measures will reduce our cost and debt levels.
The Staffing services' ERP system development project is progressing as planned. In the third quarter, we have taken major leaps forward in system development, which will allow us to roll out the system with a wide range of functionalities and high volumes. In Southern Finland, the roll-out will take place during November, and we aim to roll out the system on a large scale during the rest of the year.
We outsourced 30 finance and HR positions to our partner and are now working together to develop finance and HR functions with the help of technology and automation.
During the third quarter, we also completed targeted staff reductions and significantly improved the efficiency of our premises.
In addition to the EUR 3 million in annual savings from last year's profitability programme, we estimate that the measures to modernise our operating models will bring us annualised cost savings of around EUR 2.8 million, of which around EUR 0.8 million will be allocated to the rest of year 2024. One-time costs of approximately EUR 0.8 million were recognized in 2024 for the implementation of the renewal.
Our strengths nation-wide presence and broad customer base
Our long-term objective is to increase our EBIT margin to 8%. We believe we will achieve this level through three sets of actions: transforming our operating models with technology, benefiting from the economies of scale of revenue growth, and increasing the share of more profitable industries and services in our portfolio.
Our nationwide presence and strong cooperation with our network of entrepreneurs is a major competitive advantage and a source of growth for us. In the franchising sector, a nationwide survey of entrepreneur satisfaction was carried out in the summer, according to which Eezy's entrepreneurs were the most satisfied with their cooperation with the chain in Finland.
A key source of growth for us in the strategy period will be the cross-selling of our full-service offering to our broad customer base. We already have a number of successful cross-selling projects under our belt. We are confident that we can help our clients with a wide range of personnel resourcing, recruitment, leadership development and organizational culture design needs.
We have taken decisive action in a difficult market environment to create a stable and healthy foundation for Eezy on which to build scalable growth. Trends in the operating environment, such as labour shortages and work life transformation, will provide a tailwind for our growth in the years ahead. We have a strong nationwide market position, the broadest range of work-life services and competitive advantages that are difficult to replicate, such as the AI-driven ERP system. I believe in our long-term strategic goals for both growth and profitability. We will continue to drive forward the actions in line with our strategy, profitability first.
I would like to thank the people of eezy, our customers and our partners for the good cooperation in challenging times."
Result publication event:
A Finnish-language briefing for analysts and media will be held on 5 November 2024 at 13.00 Finnish time as a webcast at https://eezy.videosync.fi/q3-2024
The briefing will be hosted by CEO Siina Saksi and CFO Joni Aaltonen. During the presentation, there will be an opportunity to ask questions. The presentation material will be available at the company website at https://eezy.fi/en/financials/reports-and-presentations/ before the conference. A recording of the audiocast will be available at the same website later.
Attachment: Interim Report January-September 2024 in PDF format
Further information:
Eezy Plc
Siina Saksi
CEO
siina.saksi@eezy.fi
tel. +358 50 550 3912
Joni Aaltonen
CFO
joni.aaltonen@eezy.fi
tel. +358 40 524 7270
Marleena Bask
Communications and Marketing Director
marleena.bask@eezy.fi
tel. +358 50 352 3643
