Transcript

Trond Johannessen — CEO

Good morning, and welcome to this presentation of Pexip's second quarter results. My name is Trond Johannessen, and I am the CEO. Together with me here at Lysaker, I have Øystein Hem, our CFO, and Åsmund Fodstad, our Chief Revenue Officer. Together, we will take you through the highlights of the quarter. The standard disclaimers apply as usual. First, a brief overview of Pexip for those new to the company. Pexip was founded in 2012, and currently we operate in 25 countries across the globe. We are a secure video meeting and video infrastructure company delivering software and Software-as-a-Service. Pexip has unique and established partnerships with the leading companies in our industry. We complement and enhance their solutions and do not generally directly compete with them. Our customers are mainly large organizations, both in the private and public sector, that have specific needs when it comes to interoperability, security, and data control. The financial performance has been strong and has been continuously improving over the last quarters. Now to the highlights of the past quarter. Our annual recurring revenues continues to grow, and this quarter we grew with $5.2 million. This gives us an ARR base leaving Q2 of $140 million. In Q2, we had continued strong growth in our Secure and Custom business area with new ARR of $4.9 million coming from this area. A large part of this came from defence and national security, which is a core segment to Pexip, and I will come back to that. Connected Spaces also grew slightly in the quarter, which is good to see. EBITDA came in at $7.2 million and cash flow ended at $8.1 million. If we look at our second quarter performance in the context of the last 12 months, we see that the positive trend from the previous quarters continues. Our total ARR continues to grow and year-over-year, the growth rate was 18%. Our 12-month rolling EBITDA reached $40 million, which is a 60% improvement since second quarter last year. This corresponds to a 31% EBITDA margin. Finally, also our free cash flow continues to grow and ended at $38 million for the last 12 months. We do take this performance as evidence that we are operating in attractive markets with relevant products and a strong market position. As most of you know, Pexip has two main solution areas. Pexip Secure and Custom, which is about privately hosted video meetings that give