Solteq Plc Interim Report January 1 – September 30, 2022

    Solteq Plc had a weak third quarter. The Group’s revenue was EUR 14.4 million and comparable operating result EUR -0.5 million. The revenue decreased by 3.7 percent and comparable operating result by 141.9 percent from the comparison period. In addition, the company wrote off the product development investments made to the Solteq Robotics business, resulting to a one-time negative impact of EUR 4.4 million on the company's operating result. The operating result of the review period was EUR -5.0 million.

    The difficulties were mainly caused by decrease in the revenue and profitability of the Solteq Digital segment and challenges in the development of the Solteq Software segment’s Utilities software products. Solteq published a profit warning on September 19, 2022 and lowered its guidance for both revenue and operating result.

    The Solteq Software segment accounted for over one-third of the Group’s revenue, and the Solteq Digital segment for less than two-thirds. Solteq Software’s profitability was affected by difficulties in product development in the Solteq Utilities business area. This increased delivery costs for projects and services and decreased customer invoicing. The revenue and profitability of Solteq Digital were weakened by slower than expected sales and delays in the commencement of customer projects. Foreign subsidiaries accounted for 23.4 percent of the Group’s revenue during the quarter. Due to the weakened profitability, the company is actively trying to find ways to improve profitability.

    Russian invasion of Ukraine, increasing inflation, and changes in the energy sector caused insecurities in the operating environment during the third quarter. Economic insecurity was reflected in customer organizations’ cautiousness and decreased demand. Going forward, the high inflation and rising interest rates will affect the Group’s cost level.

    Despite the company’s difficulties and changes in the operating environment, the outlook for Solteq Group’s international and domestic business is estimated to remain stable. Demand in the key solution areas of Solteq Software is expected to create significant growth opportunities, especially in the energy sector. In Solteq Digital, growth will be driven by the internationalizing customer base and new technological solutions. Solteq Group is updating its business strategy and will release it within the current quarter. Solteq continues to strengthen its international operations and to develop the Utilities business for profitable, international growth.


    CEO, Aarne Aktan