OrderYOYO's Q2 trading report was solid (the H1 report is due 22 August), with GMV and ARR y-o-y growth of 26% and 23%, respectively. Revenue growth of 22% y-o-y was 1pp above our estimate. Q2 profitability, however, was substantially better than expected, with adj. EBITDA and cash EBITDA coming in 10% and 64% above ABGSCe, although on relatively small numbers. The former equated to an adj. EBITDA margin of 16%, up 6pp y-o-y and 1pp q-o-q, and the latter to a cash EBITDA margin of 7%.
We lift '24e-'26e EBITDA by 5-4% and expect a fourth upgrade
We lift '24e-'26e EBITDA by 4-5% (ARR by <1%), as Q2 again proves that OrderYOYO is able to combine good growth with rapidly improving profitability. Although we understand that a portion of the profitability improvement is due to some difficulties in filling vacant positions within sales, the growth figure suggests that sales efficiency has improved (although we see increased risk to our growth estimates in '25e/'26e if the hiring trend continues). We expect the hiring pace to gradually increase in H2, but our estimates remain above all five guidance items, and are further de-risked after the solid Q2. In addition, the DKK 148m in H1 revenues and DKK ~23m in adj. EBITDA, combined with the fact that H2 tends to be significantly stronger than H1, makes the current DKK 290m-300m revenue and DKK 45m-50m adj. EBITDA guidance look conservative (we are 3% and 8% above the high ends). We are also 11% above the cash EBITDA guidance despite expecting a material ramp-up in product development in H2.
Lifting FVR slightly to DKK 6-14 (5-14)
OrderYOYO is currently trading at 2.7-1.9x EV/Sales and 40-15x EV/EBITDA-capex in '24e-'26e. A valuation vs. US peer Olo yields DKK 6-8, and Nordic SaaS peers yield DKK 9-12. Our DCF points to DKK 14.
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