Sinch AB (publ) 134 0 Kommentare Interim report January – March 2020

Interim report January – March 2020

January – March 2020

Net sales increased by 47 percent to SEK 1,624.2 million (1,108.8). Organic growth in local currency was 32 percent.
Gross profit increased by 54 percent to SEK 446.7 million (289.5). Organic growth in local currency was 36 percent.
Adjusted EBITDA¹ increased by 64 percent to SEK 184.3 million (112.2).
Adjusted EBIT² amounted to SEK 168.8 million (102.3).
Profit after tax for the quarter amounted to SEK 96.4 million (57.8).
Diluted earnings per share amounted to SEK 1.74 (1.08).

”It is comforting to report strong financial performance in these times of unprecedented uncertainty” – Oscar Werner, CEO

Significant events during the quarter

On 19 March, Sinch entered into a definitive agreement to acquire Chatlayer BV for an enterprise value of EUR 6.9 million on debt-free basis. The acquisition is financed using Sinch’s available cash at hand. Chatlayer is a cloud-based software platform that lets businesses create multi-lingual chatbots and voicebots using Artificial Intelligence (AI) and Natural Language Understanding (NLU). The transaction was closed on 1 April.
On 26 March, Sinch entered into a definitive agreement to acquire Wavy, who offers services in Latin America, for a total cash consideration of BRL 355 million and 1,534,582 new shares in Sinch. The acquisition is financed through a combination of cash and debt facilities. Closing of the transaction is subject to customary closing conditions and approval from the competition authority in Brazil. The transaction is expected to close in H2 2020.
On 26 March, Sinch has resolved on a directed new share issue of 5,000,000 shares at a subscription price of SEK 300 per share. The directed new share issue generated a large interest and has been carried out to selected Swedish and international institutional investors. Through the directed new share issue, Sinch raised SEK 1,500 million before issue costs.
On 26 March, Sinch has secured an increase in the existing credit facility of SEK 600 million for M&A, provided that the company meets certain pre-defined terms and conditions. After the increase, the facility has a total commitment of SEK 1,850 million. In addition to the credit facility, Sinch has overdraft facilities of SEK 250 million in place, an increase of SEK 50 million from year-end.
In response to uncertainty around Covid-19, Sinch management has initiated a range of precautionary initiatives to protect employees and ensure maintained service delivery in all circumstances. Negative effects of Covid-19 are primarily concentrated to the smaller Voice and Video segment where travel restrictions are causing decreased demand from ride haling companies. Despite lower usage of certain marketing-related messaging products, overall transaction volumes in the Messaging segment have risen significantly in March and the increase may partially relate to Covid-19.