Formpipe’s new strategy (initiated in Q4’20) continues to be fruitful. Q4 sales grew 18% y-o-y to SEK 122m, 9% ahead of ABGSCe, chiefly due to better Delivery sales. While this also led to higher opex than expected, EBIT of SEK 16m (13.1% margin) was above our forecast of SEK 11m. Although Private’s 13% y-o-y growth represented a slowdown compared with previous quarters, we still think the division delivered solid results. Here, its partner Temenos is a key driver of growth, and we think that this will continue, especially considering that Formpipe was recently awarded “Temenos Solutions Provider of 2021”. Moreover, both Public SE and Public DK showed good performances, growing 19% and 25% y-o-y, respectively. We find it particularly encouraging that Public SE has now returned to growth after several quarters with declining rates.
Temenos recently emphasised its use of partners
At Temenos’ virtual CMD (15 Feb), it emphasised its focus on growing SaaS sales and doing so with a partner-centric approach, which plays well into the hands of Formpipe. While FPIP’s Q4 SaaS ACV sales of SEK 7m were slightly below ABGSCe at SEK 9m, we expect SaaS sales to grow at a ’21-‘25e CAGR of 34%, driven by its strong relationships with Microsoft and Temenos together with a broadened product portfolio. Furthermore, we believe that Public SE has troughed, and that its recent acquisition (Alkemeit, with sales of ~SEK 25m) will strengthen its position significantly. In terms of estimate changes, we raise ’22-’23 sales by 7-8% (3-4% underlying, 4-3% M&A), which leads to EBIT coming up 9-6%.
Formpipe is currently looking into a potential spin-off
We continue to see good growth opportunities for Formpipe. We forecast ’25 sales of SEK 666m for a ’21-‘25e CAGR of 11%. Furthermore, Formpipe has recently started to investigate
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