Maven Wireless publish interim report for second quarter 2023. The interim report is available as an attached document and at www.mavenwireless.com
Continued expansion with US order and a new record quarter
Second quarter 1 April – 30 June 2023
- Net sales amounted to SEK 65,437 thousand (21,536)
- EBITDA amounted to SEK 11,044 thousand (-918)
- Operating profit amounted to SEK 9,705 thousand (-2,083)
- Order intake amounted to SEK 34,507 thousand (20,412)
- Orders from 15 customers, of which 2 new customers during the period
- Cash flow from current operations amounted to SEK 4,113 thousand (6,039)
- Earnings per share 0.19 (-0.04)
The period 1 January – 30 June 2023
- Net sales amounted to SEK 106,507 thousand (34,279)
- EBITDA amounted to SEK 14,918 thousand (-5,092)
- Operating profit amounted to SEK 12,295 thousand (-7,371)
- Order intake amounted to SEK 69,924 thousand (49,395)
- Orders from 26 customers, including 7 new customers during the period
- Cash flow from current operations amounted to SEK -2,939 thousand (-2,177)
- Earnings per share 0.23 (-0.15)
- Life Cycle Assessment -68% kg CO2e during operation
CEO’s statement
The group's net sales of SEK 65 million during the quarter are significantly higher than sales in previous quarters. The turnover growth is 204% compared to the same period last year. Cumulative turnover for the first half of 2023 is SEK 107 million, which is already higher than the full year 2022 (101). Furthermore, we deliver an improved operating profit of approximately SEK 10 million, which gives an operating margin of 15%.
The availability of IC components has improved and lead times continue to get shorter. With lower spot material costs and to some extent adjusted product prices, we reach a gross margin of 35%, which is higher than the same period last year (34%). We deliver some old orders with old prices during the quarter, which holds back the improvement in the gross margin somewhat.
With shorter lead times on components and improved logistics, we offer a shorter lead time of 12–20 weeks on our standard products, which is clearly lower than during the same period last year. For our framework agreements, this means that our customers do not need to place orders for their projects with as much time in advance, which is why order intake for the framework agreements has decreased during the period when the production for the framework agreements for the year has already been placed. Order intake was SEK 35 million during the quarter, which results in an order book at the end of the period of SEK 173 million.
Cash flow from current operations before changes in working capital amounted to 11 million during the second quarter. During the period, the cash flow has been negatively affected by overdue accounts receivable of approximately 20 million, the majority of which has been settled after the end of the period. But there is also a negative impact on the cash flow of working capital tied up in strategic inventory related to production in Note's Pärnu factory and upcoming production at Kitron in Jönköping.
The group's expansion continues within existing regions where, in addition to existing framework agreements, we win new customers and projects in more countries. During the month of April, we won a new framework agreement with ONE Nordic and at the same time received an order for a major infrastructure project in Sweden worth approximately SEK 9 million. Furthermore, the group has secured 6 different deals for Microsoft's data centers where we have simultaneously established a distribution agreement with Anixter for continued data center deals.
The expansion in North America continues where our American subsidiary received the first order for a casino in Nevada worth approximately SEK 6.8 million. The North American market represents approximately one third of the world market, which means that the group's addressable market in 2022 is SEK 11 billion in North America alone.
Sustainability and cyber security continue to be important areas with increasing focus from both our partners and end customers. Our energy-efficient and maintenance-free solutions are attractive both from an energy and cost perspective, but also from a sustainability perspective. We also offer secure systems that meet the requirements for cyber security in the future where end customers can be confident in meeting future local laws on cyber security based around the EU directive NIS-2.
Finally, I am happy that the group is continuing its global expansion also in the North American market. In addition, the expansion in existing markets continues at a high pace according to the plan where we continue to digitize society with our climate-smart and safe products with high bandwidth both for 5G and for other critical communications.
Kista, August 15, 2023
Fredrik Ekström – Group CEO
Significant events during the second quarter
Maven Wireless receives breakthrough order in USA worth SEK 6,8 million
An American neutral host company will use Maven Wireless groundbreaking DAS to build mobile coverage in a casino in the state of Nevada, USA. The order value is approximately SEK 6,8 million. The order is received into Maven Wireless Inc., which is a subsidiary to the Maven Wireless group.
Maven Wireless signs production agreement with Kitron
Maven Wireless Sweden AB (publ) has entered into a production agreement with Kitron Aktiebolag a leading Scandinavian Electronics Manufacturing Services (EMS) company. Kitron has operations in Norway, Sweden, Denmark, Lithuania, Germany, Poland, the Czech Republic, India, China, and the United States. The manufacturing partnership will initially be supported at Kitron’s factory in Jönköping Sweden.
Maven Wireless signs framework agreement with ONE Nordic and receives first order of SEK 9 million
Maven Wireless signs a framework agreement with ONE Nordic regarding both DAS systems and repeater products for mobile telephony as well as blue light radio systems and associated services. At the same time, a first order is received for mobile phone coverage for an infrastructure project in Sweden amounting to approximately SEK 9 million. The agreement is valid until further notice, with opportunities for the parties to revise prices if costs change by more than 5%. There are no volume guarantees in the agreement, which can, however, be used for future projects for all ONE Nordic group companies.
Maven Wireless supplies products to Microsoft data centres
Maven Wireless has had its products approved to establish secure communication in Microsoft's data centres with the first rollout in Europe. The approval includes the company's digital DAS system for TETRA communication where a standardised solution will be used globally. Establishment of the systems takes place starting in Europe, where the company has already received orders for data centres in Ireland, Italy, Spain, and Holland. The sales value per data centre for the company is between SEK 0.5 and 1 million. Rollout of the corresponding solution is also planned for both Asia and the USA. Microsoft has over 200 data centres spread across the world.
Maven Wireless validates additional 8 European patents
Including the new validated patents, Maven Wireless possesses 67 patents worldwide and has additionally 12 patent applications pending. These patents protect Maven Wireless digital DAS products and the way how the products transport data over the fibre network. They also support and protects Maven Wireless’ business throughout the European market.
Maven Wireless granted a fourth patent in South Korea
Including the new granted patent, Maven Wireless possesses 68 patents worldwide and has additionally 11 patent applications pending. The new patent in South Korea covers a method performed by a digital DAS for routing aggregated carriers received by at least one digital master unit of the DAS to at least one digital remote unit of the DAS.
Significant events after the end of the period
Further cash flow improvements
After the end of the period, the cash flow for the group has improved by the fact that most of the outstanding unpaid accounts receivable have been settled. Of the SEK 20,026 thousand outstanding unpaid accounts receivable at the end of the period, SEK 3,122 thousand remain as of July 31, 2023.
Maven Wireless expands into Australia
Maven Wireless expands the sales and marketing organisation with a new technical sales professional based in Sydney. The group has already sold products in this market and has now the ambition to take a bigger portion of the local market in Australia and New Zeeland. Maven Wireless addressable market in Australia, New Zealand and Singapore is roughly 100 MUSD 2023 and it grows by 6% CAGR (from Market&Markets 2022).
Maven Wireless granted a fifth patent in South Korea
Including the new granted patent, Maven Wireless possesses 69 patents worldwide and has additionally 10 patent applications pending. This new patent protects Maven Wireless digital DAS products and the way how the products transport data over the fibre network. This patent supports and protects Maven Wireless’ business especially in the APAC region.