Friday, May 20 2022

Oslo, Norway, November 11, 2021 – The video communication provider, Pexip, today presented its quarterly results for the third quarter of 2021.

Pexip’s subscription base measured in annual recurring revenue (ARR) achieved $ 99.8 million in Q3 2021, against $ 72.8 million in Q3 2020, an increase of 37%. Pexip demonstrated strong year-over-year growth through strong sales to public sector organizations. Highlights of the quarter include:

  • ARR reached $ 99.8 million, reflecting 37% year-on-year growth
  • Income to NOK 183 million, 35% growth over one year
  • Negative EBITDA 40 million Norwegian kroner, developing as planned, and in accordance with the investment plan and strategy
  • Named “Challenger” in Gartner Magic Quadrant for Meeting Solutions

Key Q3 contracts include:

  • Defense Information System Agency (DISA), a US Department of Defense (DoD) combat support agency, made up of military, federal civilians and contractors. DISA provides information technology (IT) and communications support to the United States President, Vice President, Secretary of Defense, Military Services, Fighter Commands, and any individual or system contributing to the defense of the United States. DISA has chosen Pexip to power their primary video conferencing service, as well as to support interoperability with Microsoft Teams;
  • The US Department of Labor, who selected Pexip-as-a-service as a collaboration solution for its new Hybrid Workplace initiative for its nearly 18,000 employees;
  • A large central European car manufacturer has chosen self-hosted software Pexip for Pexip meetings, Microsoft Teams interoperability, and One Touch Join functionality. Pexip provide an integrated platform for multiple corporate locations and various videoconferencing solutions around the world;
  • a EU institution signed a contract for Pexip’s Self-hosted software, including Cloud Video Interoperability (CVI) for Microsoft Teams interoperability.

The percentage of retained revenue from existing customers was 100% year-over-year, including a 10.8% churn rate in the past twelve months.

“We continue to follow our communicated growth plan, and our result for this quarter is affected by the significant investments in commercial resources, which will accelerate our growth in the years to come. While the repercussions of the COVID 19 pandemic continue to affect the length of the sales cycle and the rise of sales staff, we are confident that our unique product offering combined with our organization building will lead us to our goal of $ 300 million of ARR in 2024 ”, declared Pexip CEO and Interim CFO, Øystein Dahl hem, and continued:

“The third trimester is generally a good trimester for Pexip in the public and federal sectors and we find that our strengths in secure solutions for critical communications requiring strict confidentiality and security are very attractive to organizations such as government and military departments and agencies. A good example is the Defense Information Systems Agency (DISA) in United States. Besides, Pexip’s the unique ability to seamlessly link different video conferencing systems, interoperability, continues to be a key selling point for many large organizations. “

Q3 2021 Financial Highlights

Q3 2021 revenue was NOK 182.9 million, up 34% from NOK 136.3 million in Q3 2020, driven by strong sales during the quarter of Pexip’s Self-hosted software.

The cost of sales in the third quarter of 2021 was NOK 22.7 million, reflecting a gross margin of 88%, against NOK 11.0 million in the third quarter of 2020 due to a shift to cloud computing versus investing in own or rental hardware, which also reduces investment and operating expenses.

Salary and personnel costs amount to 152.1 million NOK over the quarter (83% of sales), against NOK 117.3 million (86% of turnover). The increase is mainly due to strong headcount growth over the past twelve months, in line with Pexip’s growth strategy.

EBITDA reported in Q3 was negative NOK 40.5 million, reflecting a negative margin of 22%, down from NOK 23.8 million as of Q3 2020. The evolution of the EBITDA margin is in line with expectations, with the Company investing in growth initiatives where the expected increase in revenues will be less than the increase in operating expenses.

Outlook

Long-term, Pexip believes that the growth of enterprise-level video communication will increase due to the explosive adoption and use of video communication after Covid-19, and the implementation of sustainability measures. Many companies plan to adopt hybrid work models upon their return to the office, combining office and remote work, which will deliver benefits far beyond the need for social distancing, such as reduced travel and emissions. associated, labor flexibility and increased productivity. Furthermore, Pexip believes in the increased use of video in the workflows of organizations with their clients / clients, thus creating significant new market opportunities.

To accelerate growth Pexip has invested in increasing the Company’s commercial and marketing presence as well as R&D capabilities, and plans to continue to do so. Pexip intends to deploy up to 70% of the net proceeds of the IPO over the next two to three years. This implies a return to neutral EBITDA in 2023, from a negative EBITDA rate estimated in 2021 and 2022 in a range of 25-35%. As Pexip Exiting the investment period, the company expects an EBITDA rate above 25% in 2025 as well as revenue growth above 25%. The main catalyst for all these initiatives is the strengthening of Pexip team, and Pexip targets 550-600 employees by the end of 2021.

Consensus estimates by analysts

Every quarter before the results are announced, Pexip collects earnings estimates from stock analysts who currently cover the company. The consensus estimates and the methodology used to prepare the consensus estimates are published on the company’s IR web pages here: https://investor.pexip.com/consensus.

Presentation of third quarter results

The results for the third quarter of 2021 will be presented at the Felix Konferansesenter (Atlantic), Bryggetorget 3, Oslo, Norway, and by a video webcast on Thursday November 11, To 5:00 p.m.. The presentation will be held in English by Øystein Dahl hem (CEO and interim CFO), Tom-Erik Lia (Strategy Director), smund Olav Fodstad (President Global Sales & Marketing) and Michel sagen (President of the council). Please register using this form: https://www.pexip.com/q3-2021-results-presentation-registration. Questions can be submitted to IR@pexip.com.

This information is subject to disclosure requirements in accordance with Articles 5 to 12 of the Norwegian Securities Law.

Contact people:

Investors: Investor Relations, IR@Pexip.com, +47 94 80 58 51
Media: Lars-Einar Petterson, Communication Manager Norway, Lars.einar.petterson@pexip.com, +47 93 44 88 27

On Pexip | pexip.com

Pexip simplifies complex video conferencing to enable organizations to collaborate face-to-face, regardless of location or technology. Our scalable platform enables high-quality video meetings, with enterprise-grade security, and easily adapts to customers’ IT needs and existing infrastructure. That makes Pexip the main supplier for large companies and public sector organizations. The solution is sold by 300 channel partners in 75 countries and used in more than 190 countries. Pexip was listed on Oslo Børs in May 2020.

https://news.cision.com/pexip-as/r/pexip-q3-2021—solid-growth-driven-by-sales-to-public-sector-organizations,c3451668

https://mb.cision.com/Main/19292/3451668/1494722.pdf

https://mb.cision.com/Public/19292/3451668/968582e022933039.pdf

https://mb.cision.com/Public/19292/3451668/beea7061cd047be2.pdf

(c) Decision 2021. All rights reserved., source Press Releases – English


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