Half-Year Report, January 1 – June 30, 2023
Solteq Plc’s second quarter was weak. The Group’s comparable revenue was EUR 13.6 million, down by 8.2 percent from the comparison period. This was mainly due to a weaker demand than in the comparison period affecting the Retail & Commerce segment. The downturn in the segment’s revenue was due to a poorer performance in customer acquisition and certain customer deliveries being postponed to the future.
The comparable EBITDA was EUR -0.5 million, and the comparable operating result was EUR -1.9 million. Profitability decreased in both segments relative to the comparison period. In Utilities, the profitability suffered from a heavy cost structure. Utilities continued to work on solving the problems and improving efficiencies, but this did not progress as promptly as aspired. In Retail & Commerce, utilization rates didn’t reach optimal levels due to the decreased order base.
The bland beginning of the year was aligned with the company’s expectations. The relation between revenue and expenses is expected to be clearly better for the rest of the year. In addition, the demand for the Retail & Commerce segment is estimated to pick up towards the end of the year.
The Retail & Commerce segment’s business based on Microsoft Dynamics 365 Business Central and LS Retail was sold to Azets Group. This allowed the company to decrease its indebtedness and focus even more on the chosen software solutions, expert services, and business areas.
The instability in international politics creates uncertainties in the Nordic operating environment, for example, high inflation and increased costs. The uncertainties still reflect in the demand for the services and solutions offered by the Retail & Commerce segment. In the Nordic energy sector, demand for software solutions and expert services is driven by changes in industry regulations, the transition to renewable energy sources, and opportunities created by emerging technologies for business efficiency.
We expect the market outlook for the Retail & Commerce segment to remain moderate during the current financial year and demand to recover as the market stabilizes. We expect the long-term market outlook for the Utilities to remain good and provide opportunities for profitable growth.
CEO Aarne Aktan