Good morning, everyone. You are welcome to follow up Easor Q1 first Easor release. It is Otto-Pekka Huhtala who is speaking. Here is my colleague.
Hello, my name is Matti Eilonen. I'm CFO of Easor.
Thank you. Here's our agenda today. First, I will go through some highlights and Easor in brief and strategy. After that, Matti will open more about figures and guidance. At the end of the period, we have investment highlights and the possibilities to ask any questions for us. Let's go. Here are some highlights. Easor want to be a growth company. As many of you know, we have de-merged from the big accounting company in the beginning of this year. The most important thing for us is to create our delivery channel. It has been last year and this year the most important issue. Here we can see some positive signals from that. In the center of the picture, you can see the number of partner accounting offices that it has increased from 40 to over 300 numbers.
Left-hand side, we can see also that the number of company clients increased over 20% in one year. We have a great start and as independent listed company, we are creating a foundation for growth continuous. Good greetings is that also that now we have also first product for sales in Italy also. Our mission is that Easor makes entrepreneurship possible for an increasing number of people. It may have good to go through shortly our history, our background, where we come from, what is our knowledge. Easor's history is based on a strong accounting expertise where the accounting firm developed easy-to-use software for its clients, and later on, efficient software for its accountants. Since 2002, our software has been developed. First we focus for entrepreneur, UX. Easor App is the software for companies.
After that, when we have resolved all enterprises problems, what comes to financial routines, then we focus for accountant point of view, and we created our first version of our Easor Accounting. Came mobile application for company clients and since 2016, we have developed our own machine learning tools and adopted AI in accounting entries. We get first clients in production in Sweden in 2021. 2022, we acquired this Nomo platform in Spain. It means that today we have two software. We have southern software, which based for this Nomo acquisition, and we have the Nordic one, what we have developed internally as long as you see. We started sales for all accounting firms in October 2024. This was the strategic decision point which accelerated the journey that we are now as a public platform company. This is surely our background.
Today, there is over 17,000 small and medium enterprises who are using our platform. Our net sales is over EUR 20 million, and it is 100% annual recurring revenue. We have more than 130 employees in four active markets. End of Q1, there was over 300 partner accounting offices. Before we go to the strategy, it's good to understand what kind of is the market where we are. The first point, which is supporting digital platforms, is the legislations. All governments in EU are pushing businesses to use digital tools that they can have better control for anti-money laundering things and so on. It means that, for example, e-invoicing will be mandatory in coming years in all EU countries.
The second one is customer behavior is changing toward digital platforms. We have good experience of that, how we can sell today, like the whole service packages for entrepreneurs, which include also accounting services, but of course our platform. Third one is digitalization is happening just now, especially in Spain. There is ongoing some legislations like VeriFactu and e-invoicing, which push all businesses to use some digital tools. Over 80% of businesses in Spain, they don't use any software today. Okay, what is Easor? Easor name comes from two words, easy, advisor. We are as a financial management platform, and we have two main stakeholders, of course, these entrepreneurs. We are resolving those problems. The biggest problem for entrepreneur from this environment is that where do I find the help to my businesses? How I would save time what I'm spending with financial routines?
For service provider, for accounting firms, where I would find more clients and how it would work more efficiency and so on. We connect entrepreneurs and service provider. What are our strategic advantage? We offer easy-to-use financial solutions for businesses and very efficient tools for service providers and, of course, growth channel for accounting offices. We have some marketplaces, and we have that way accounting offices are getting new clients. Okay, what does this mean in practice? We have two different interfaces. We have Easor App. There's the mobile application in this figure, but of course, there's the browser version. It's very easy-to-use app for your daily businesses, and it's easy to find your own accountant, and it is very easy to integrate to other software. For example, today there is over 400 different integration between Easor App to other ERP solutions.
We have partner accounting offices. For them, we have totally different interfaces, and this is one different need that professionals, they need to have more features compared to entrepreneurs, what they need. That's why we have two different interfaces. We offer efficient tools to run accounting and business. We offer new clients and, of course, integration to other software. For other service providers, we offer delivery channels, for example, banking services, collection services, and so on. Our growth strategy basic for this thing that the major thing is that we invest heavily to get new users into our platform. Later on, we try to grow our net sales per client by rolling out new features for them.
In this picture, you can see that in Finland, we have the more feature compared to Italy, and it is basic for the history what we have. Today it's good to know that we have really the first production in place also in Italy. Our strategic priorities for this year is the growth, and we are expanding the network of partner accounting offices and actively supporting them in new customer acquisition. When we are acquiring new partner offices, it's very important that we get also new clients for them, that they really start using our solutions, and that's important, and we have good personnel for that. End of the Q1, there was, as I said, over 17,000 end clients and over 300 partner accounting offices. Today, over 1,000 accountants are already using our platform.
Second priority is AI. There is also some market research in the first bullet that this Finnish Association of Accounting Firms say that accounting firms in Finland estimate that 47% of their purchase invoices are processed automatically by the software what they use. In contrast, the automation rate in Easor's accounting software is around 80% for all processed material, including all receipts, bank statements, everything. Of which the automatic accounting of purchase invoices, one of the easiest to automate. For example, 2004, we had a situation that our purchase invoice automation rate was over 50%. That's the one, the biggest asset what we have, especially in Nordic world, where the automation level is very high.
We are using AI, of course, in the whole company. It will have the significant productivity benefits, to streamline our whole development process from idea to delivery. This year we will add AI-powered solution that improves the productivity of partner accounting offices, help them to make better businesses, and make everyday life easier for company's clients. This was shortly strategy point of view. Now Matti will continue from the figures. Thank you.
Hello, everybody. Welcome to follow this business review from my behalf also. Let's have a look a little bit about the figures. First, I would like to point out three things about the review period. First of all, a good solid start as an independent company. First couple of months, it was together with a big accounting company, and after the merger, one month as an independent listed company. Our big priority is to grow. We were able to grow of this first quarter. Our number of clients, it went up by 21%, up to 17,000 clients. The net sales followed that trend a little bit behind. It grew by 5.5%, while our profitability was pressed down because we are accelerating growth. That means more costs at the beginning. Also, when we are operating as an independent listed company, it increases our costs.
A little bit effect on EBIT by increased depreciation. Third part is our investment level, which is decreasing. It decreased last year by EUR 3.5 million, and it continued decreasing on the first quarter as well. It decreased by 11% to EUR 2.4 million from EUR 2.7 million. We use this free cash flow to grow more and to accelerate growth. As I mentioned, our net sales went up by 5.5%, up to EUR 5.4 million. This growth came from Finland and from Spain. We were able to get new customers in both countries through our broader distribution channel network. We started software fees in Spain, that's how the growth came in quarter one. Obviously, growth comes from the new customer acquisitions. On the left-hand side, we can see the development of our company clients, which ended up to more than 17,000.
All in all, chargeable clients are a little bit over 16,000. There's a big difference from last year, last quarter to this first year, first quarter. As you can see, on the darker ring, there's a big chunk, and t hat's basically comes from Spain. Those clients are quite small and, for example, if you compare it to Finnish average size of the company, it's less than 10% of those clients. Where does these new customers come from, then? It comes from our distribution channel, which is basically the partner accounting offices, and it's really important that we are able to grow this amount of accounting offices, as this is our main distribution channel, and it supports the midterm and longer-term growth. Right now, we have a little bit more than 130 offices in Finland and almost 200 in other countries.
In other countries, this distribution channel doesn't bring that much revenue yet, but it certainly supports the longer-term growth. About the profitability. Profitability measured by EBITA. It went down by 19% to EUR 3.2 million. The profitability is pressed down because of our growth expenses and also a little bit on administrative costs because we are an independent listed company right now. Our main priority is to grow, and we are willing to press down our figures so that we are able to grow more. EBIT went down a little bit further because of higher depreciation level. We have had massive investments in the past, and that's also affecting today when the depreciation level is a little bit higher than our investments. It's slowly catching up with the investment level, the depreciation level. On the last slide about our guidance for 2026.
We announced our guidance when we were listed, and it remains unchanged. We are expecting to have revenue between 3% and 10%, and we are expecting that our operating profit margin will decrease because we are building up the distribution channels and bringing growth investments. Thank you. That was my part, and then Otto will continue with the investment highlights.
Thank you, Matti. Why invest in Easor? The first reason is that we are a strong player in financial management digitalization. We have very good and a long track record from the Nordic side of that. We have deep expertise to accelerate digitalization in European markets. We know what are the steps, how this will happen, and how we can support that transformation. We also deeply know what this really means for the accounting offices. Second one is readiness for scalable growth, and Easor already operates in several European countries. In all countries, we have the country director, sales reps, support functions in place, and marketing. Now we are in scale mode. Of course, this year we are hiring more people for those roles. We have big investments and architectural renewal completed, and it's behind.
The third one, high recurring revenue creates stable cash flow, and this reduces the risk level of the businesses. As Matti mentioned, we will use all money what our business is generating to accelerate our growth. We are just beginning of this growth journey, but we have a good start. Fourth one, targeting over 20% annual revenue growth rate. This is medium-term goal, two to four years, through organic sales. That's why it's good to invest for Easor. Now it's time for questions, and moderator can ask some questions or if there somebody will ask via voice, so please go ahead.
Thank you. Reminding participants, if you want to ask questions with your audio, you can use the raise hand function below the video. Let's take a couple of questions first from Atte Riikola at Inderes. What was Finland's share of Q1 revenue?
Sorry. Could you ask again?
What was Finland's share of Q1 revenue?
Well, the majority obviously come from Finland and those clients which we started to invoice in Spain, they are really small, and they have also really affordable contracts so that the revenue from Spain, it was in minor part.
Yeah.
We haven't announced this actual figure as we follow the full company, but it was very small part which came from other countries.
How many partner accounting offices do you have in Spain?
Roughly 15-20 today. It's good to understand that in Spain, the business logic is totally different compared to Finland because of the market status. In Spain, we are selling software for accounting offices, and they are adapting it to their clients. For example, there are some accounting offices that after the deal, one, two months and 200 clients is using our software. Compared to Finland, where we get the new partner offices, we try to bring them some new clients, and they test it that everything works well, and after that it will start increasing by client, by client, and so on. In Finland, all businesses are using some digital solutions, we are more or less in Finland, in changing markets.
When you compare the number of partner accounting offices in different countries, it's good to understand that it doesn't mean the same volume of revenue later on.
Okay. What kind of feedback has the software received from new partners in Finland and internationally?
Yes, good questions. In Finland, there is, I can say, two different kind of accounting offices, very small accounting offices, and they are very familiar with our solutions. It's very easy to sell for their clients, I mean, the Easor App, and Easor Accounting helps them to make more efficient their work. One big reason to be partner offices for small accounting firm is that they are getting clients via us. For bigger ones, they are more interested of efficiency. We have got many messages that they can save 30%-50% of used time when they are using our solution. Of course, we know that because we have let accounting offices and compared to other commercial solution that how does they work.
In South, this is also good to know that, of course, we are very aggressive when it comes to pricing model in South because we want to get the new users as much as possible. Why accounting offices really choose us is also efficiency. We are resolving little bit different problems in South compared to Nordic, where we have good infrastructure around us. Efficiency is the reason also in South why they choose us.
Okay, thank you. Have you been successful in winning larger accounting offices as new partners?
This is good question. What is the large accounting offices? Yes, we have, I can say, large accounting offices, especially in Finland, where there is over 20 employee in one company. Yes. Of course, we have negotiation ongoing with all big ones.
Okay. How successful have you been with recruitment and growth investments? What is your current headcount?
Yes. It has been very good to see that we are interested company. We get very high skills peoples who want to work with us, and we have got well, marketing specialist and sales reps and head of sales, what we have recruited. Yeah, that's working well.
The current headcount is a little bit more than 130.
Yes.
Okay, thank you. Net financial expenses were low in the quarter relative to the EUR 20 million of interest-bearing debt. Was there anything exceptional in the figure?
Well, not really, but you have to remember that the first two months was before the demerger, when Easor didn't have the loan, and the loan is affecting only from beginning of March.
Okay. The average software billing in Spain is under 10% of the Finnish level. How do you see this evolving going forward?
Yes, we see that in South Europe, the software prices are too much lower compared to Finland. In Finland is the highest level of the price. Our opinion is, or approach in South is that we want to be very aggressive, that we get the clients in, and we see that the more we'll adopt new features to help accounting offices, we can raise the average price of end clients. When we compare to Spain new clients, I mean the new sales channel, I mean the new partner offices and what size of customers, if we calculate by the end clients compared to in Finland, the new partner offices customer size. This is maybe four or five times higher in Finland compared to South. Because of the existing business in Finland, we have so much big clients, so the existing clients volume is so high.
That's why when we compare to current average sites, it looks like that it's under 10%. If we focus only for new channels, only for new partner offices, and what kind of clients they are bringing for us, it's five times higher in Finland compared to Spain. Long answer.
Okay, thank you. One more question from Atte Riikola. How have Spanish customers reacted to you starting software billing from the beginning of the year?
We are charging only from accounting offices. We are not charging directly to the end clients. No reaction.
Okay. A few questions from Daniel Lepistö, Danske Bank. Are your partner accounting offices increasing the use of Easor after becoming a partner? Are there any use cases where a partner has started to replace existing software in use for clients with Easor?
Accountants are very afraid of all changing, so it's the big decision for them to start using some new platform, and they want to ensure in their environment that our solution, Easor, can bring value what we have promised. We have seen some partner offices which have used more than a half year or close to one year our solution that they have switched some existing clients to start using Easor. Mostly they focus only for new clients to bring them to Easor. In Spain, because their clients are not using anything, so this is the new issue, so then they can really start using it for the whole customer base.
Okay. How is potential ARPU in Italy? Is it similar to Spain, i.e., less than 10% of Finnish level?
Maybe it is too early to say that how it will improve. Today we are offering only tool for accounting offices today, and for end clients, we are releasing this end clients solution in the beginning of fall. Maybe we'll tell later on more about that. What we have shared about market, so it's close to same level in Italy and Spain, what we see the current provider.
Okay. Can you remind us on the current status in Sweden? Are you growing your partnership network there or operate just through Talenom? Are you billing Talenom on the Swedish customers currently?
Yes and no. We are focusing to get new partner offices there, and we also launch our marketplace, and there is coming some new profile maybe during the summer. We focus for that we get a new partner office who will start using our solution. Of course, it's the most important to create the delivery channel. We are charging directly of those clients who are in Talenom side who are using our systems.
Okay. Should we expect any revenue seasonality effects in Q2 due to accounting high season?
Yes, we are expecting to have some seasonality. That's mainly because the vouchers, and the invoices tend to be a little bit lower volume during the summertime, and also that the beginning of the year-end closing vouchers are a little bit higher. There will be some seasonality, but not so strong.
Okay. The final question, can you give any practical examples on potential upselling to current customers?
Yes. If we start from Spain, there is the different plans of the software, what does they use, and now they have activated some accounting offices the lowest level, they can increase the plan. It means that they will use it more for accounting offices' point of view, we can charge a little bit more. Some add-on services, like via partner offices, they can also sell our other partners solutions like funding services, collection services. Mainly we focus for only to getting new clients and offering them to our packages, they choose what they want to use.
Thank you. That was the final question, back to you for closing comments.
Yes. Thank you very much for following our release. As we have said, we want to be a growth company. We are just in the beginning of this journey. We are creating our sales channel, we will use all of our money to boost our growth. That's our main focus. Thank you for joining.
Thank you. Bye-bye.