Successful year generating stakeholder value
Financial highlights fourth quarter
- The Group's net sales increased by 8.9% to SEK 691 m (634). Organic growth (constant currency) was 3.7%. Currency effect was 0.2%. Acquired growth was 5.0%.
- The Group's adjusted EBITA amounted to SEK 162 m (122) with adjusted EBITA margin of 23.5% (19.2).
- The Group's EBIT amounted to SEK 44 m (34).
- Profit for the period amounted to SEK -10 m (24).
- Earnings per share before and after dilution amounted to SEK -0.09 (0.22).
- Adjusted free cash flow amounted to SEK 210 m (158).
Comment from CEO Pontus Bodelsson
2024 was a successful year for Karnov Group generating stakeholder value. We launched AI solutions generating value to our customers while in parallel achieving cost-synergies to improve margins. In the fourth quarter, we achieved an organic growth of 4% and the adjusted EBITA margin improved to 24%. We are accelerating our profitable growth strategy with a Group-wide AI roadmap, utilising the strength of being a European, local player to develop scalable AI products.
PROFITABLE GROWTH DRIVEN BY ONLINE SALES AND SYNERGIES
The Group's net sales amounted to SEK 691 m in the quarter, a solid increase from the previous year driven by strong online sales as well as acquired growth from the carved-out Schultz business. Early adopters, including Denmark's largest law firm, are already using our AI legal research assistant that was launched in the fourth quarter.
The Group's adjusted EBITA margin reached 24% in the fourth quarter, an improvement of more than 4 percentage points compared to the fourth quarter last year. Synergies from the Group's two cost-initiatives are coming through as expected while operational leverage from higher net sales are further supporting the margin improvement.
We achieved an adjusted free cash flow of SEK 210 m in the fourth quarter, driven mainly by renewals of annual subscriptions to our online solutions in Region North. Leverage was 3.0x adjusted EBITDA LTM by the end of the year, in line with our financial target. We intend to allocate our free cash flow to achieve cost-synergies and further enhance our AI solutions, benefitting all stakeholders. The Board of Directors proposes no dividend for the AGM on 15 May 2025.
BOOSTING OUR AI ROADMAP FOR LOCAL CUSTOMER VALUE
Our AI legal research assistant has now been on the market for a few months in Region North and in Region South our first waves of AI features have been launched. The combination of our locally authored mission-critical legal content and AI technology brings significant, proven value to all legal professionals. Development is progressing rapidly, and we need to be both decisive and agile to meet our customers' needs.
We have taken the next steps in fulfilling our AI ambition, combining our European innovation capabilities and local market expertise into a Group AI product organisation. Adopting best practices from across the Group will benefit all our customers, as we will leverage the strengths of being a European player to create scalable AI products with local customer value.
COST-EFFICIENCY TARGET REACHED
We progress with our initiatives to reach the cost-efficiency targets. The effect of the synergies is coming through as expected.
By the end of year, the annual run-rate synergies from the Region South Integration amounted to SEK 92 m. We thus achieved our synergies target for 2024. We reiterate our ambition to generate synergies of SEK 115 m on annual run-rate basis by the end of 2026, as we progress with the next phase of the integration.
In parallel, we progress with our Group-wide Acceleration Initiative. We have during the year achieved synergies in Region North and are now upscaling in Region South and on Group level. By the end of 2024, the annual run-rate synergies from the Acceleration Initiative amounted to SEK 67 m. We reiterate our ambition to generate synergies of SEK 115 m on annual run-rate basis by the end of 2026.
In total, our progress with the two initiatives has generated annual run-rate synergies of SEK 159 m by the end of the quarter.
conference call on 18 february 2025
A webcasted telephone conference will be held at 09.00 a.m. CET today, where CEO Pontus Bodelsson and CFO Magnus Hansson will present the report and answer questions.
You can follow the presentation via webcast and ask questions in written form on the following page:
https://karnov-group.events.inderes.com/q4-report-2024
If you wish to participate via telephone, and thereby be able to ask questions verbally, please register on the link below. After registration you will be provided phone numbers and a conference ID to access the conference. You can ask questions verbally via the teleconference: https://conference.inderes.com/teleconference/?id=5009118
The presentation material and the report will be available before the conference starts at www.karnovgroup.com. An on-demand version will also be available after the presentation. The presentation will also be available on www.financialhearings.com.
For more information, please contact:
Pontus Bodelsson, President and CEO
Telephone: +46 709 957 002
Email: pontus.bodelsson@karnovgroup.com
Magnus Hansson, CFO
Telephone: +46 708 555 540
Email: magnus.hansson@karnovgroup.com
Erik Berggren, Head of Investor Relations
Telephone: +46 707 597 668
Email: erik.berggren@karnovgroup.com
This press release contains inside information that Karnov Group AB (publ) is required to make public pursuant to the EU Market Abuse Regulation (MAR). The information was submitted for publication by the contact person above on 18 February 2025 at 07:45 CET.
Karnov Group clears the path to justice, providing mission critical knowledge and workflow solutions to European professionals in the areas of legal, tax and accounting, and environmental, health and safety. With content provided by over 7,000 well-renowned authors and experts, Karnov Group delivers knowledge and insights, enabling more than 400,000 users to make better decisions, faster - every day. With offices in Sweden, Denmark, Norway, France, Spain and Portugal, Karnov Group employs around 1,200 people. The Karnov share is listed on Nasdaq Stockholm, Mid Cap segment under the ticker "KAR". For more information, please visit www.karnovgroup.com.
