Hello everyone, and you are welcome to Talenom event. Today, I have my friend, my colleague, Matti, here with me, and we are presenting our business review and strategy review today. Here is our agenda for this day. Matti will start with our latest period, Q3 report, and I will focus after that for our this morning released midterm financial targets. After that, you will have time for questions, also for Finnish. Now, stage is yours, Matti. Go ahead, please.
Thank you, Otto. Hello everybody, and welcome to this quarter three review. First, I would like to share with you some highlights of the review period. First of all, we had strong growth. We grew from EUR 61 million to EUR 76 million, bringing us 24% growth. At the same time, when we were growing fast, we were able to keep our high EBIT level. The EBIT grew a little bit more than EUR 1 million, and it was 17%. We are also keeping our guidance unchanged. It is expected to be between EUR 100 million and EUR 110 million. Operating profit is expected to be between EUR 15 million and EUR 18 million. A little bit about our strategy progress. As I mentioned, our growth was fast and strong. We were growing through organic.
1/3 came from the organic growth and 2/3 came from the acquisitions. The organic growth was supported by getting new customers and also good development in value-added services in Finland, especially. We also made acquisitions. We made four acquisitions in quarter three and 13 altogether this year. We were also developing our businesses in Spain. We just recently acquired Nomo, platform company, which has an excellent customer interface. We are expecting that Nomo has good capabilities to create growth in Spain. On top of that, we made 2 acquisitions also in Spain, more like traditional accounting business. Quite a lot going on in Spain. Good atmosphere and really good foundation for future growth in Spain.
We were also exploring new market areas, the digitalization within SMEs and the accounting processes is happening right now. That's why we are actively seeking for possibilities in Europe. We strongly believe that with our the knowledge of digitalization and the experience of automation will bring certainly benefit to that market areas. We were also making some progress in small customer concept. We had partnership contract with Fellow Bank. Through that contract, we can distribute our bank accounts and cards through our website or customer interfaces. We also got the Finnish IBAN, which is also a good step ahead. Last but not least, the software implementation in Sweden.
Earlier, we have stated that we are preparing for that, and we are starting to do that, and now it's come true. We are actually implementing our own software at this point in Sweden. It's going according to the plan. So far, we haven't seen anything that can prevent us from doing that. Yep. Net sales growth continued. It was 24%. It was pretty good growth, a little bit more than last year. It was EUR 12 million last year growth, and this year it was EUR 15 million. So a little bit accelerated growth in absolute euros. Little bit seasonal variation on the last quarter.
About the profitability, our EBITDA grew a little bit more than EUR 4 million, and the relative profitability measured by EBITDA was pretty much the same, and it was on a really high level. Our EBIT also went up, little bit more than EUR 1 million, ending up to 17% of relative operating profit. The relative profitability was depressed by a lower profitability of the acquired businesses if we compare them to the existing units which we have. Also, the integration and other costs of the acquisitions were higher, and you can see that especially on the last quarter that this has an impact on our relative profitability, there. But what is the main reason for a little bit lower relative profitability is our higher depreciation.
In 2019 and 2020, we basically doubled our investments to software, which has a significant impact on our depreciation. This year, our depreciation has gone up to 36%, so that's why it's bringing our relative profitability down. If we didn't do those software investments, we wouldn't probably be in the situation that we are actually implementing our own software in Sweden right now. I would like to remind that in Finland, we have experience that it takes about three years to increase the profitability to the same level that the existing units after we have implemented our own software. Country-specific business development. Business development in Finland was strong and steady. We grew 15%, and last quarter it was 12%, a little bit seasonal variation there.
The growth came two-thirds from the organic growth and one-third came from the acquisitions. Like I mentioned in the beginning, that it was because of increased customer numbers and good sales in value-added services. EBITDA in Finland remained at a high level. It grew a lot, and it was almost 40%. This relative profitability remained excellent, and it's because of a high automation level, and this has a really positive impact on profitability. This also gives you an idea and an image that what can be done in the profitability when you have high digitalization and highly automated processes in the accounting business. The business development in Sweden. In Sweden, we had really strong growth. It was 75%, and it mainly came from the acquisitions.
EBITDA is significantly lower level than in Finland, but it is still more or less the average of the accounting field in Sweden. In Sweden, we have invested a lot in sales, building support functions, IT and et cetera, and we are developing management structures there also. Most importantly, we are implementing our own software implementation, which has also impact on our profitability in Sweden, which can be seen on the last quarter especially. Finally, the outlook and guidance, which we have published in December 2021, we are keeping it the same, and we are expecting to have revenue between EUR 100 million and EUR 110 million, and EBIT level is expected to be between EUR 15 million and EUR 18 million. I thank you very much, and it's Otto's turn now.
Thank you, Matti. I will focus on for our new financial targets for medium term, and we are stronger focused on accelerating growth. Why? I have three message what I try to tell for a few next 15 minutes. It's that digitalization is just happening in Europe. We have the success story in Finland, and now we are going to duplicate this in new areas in Europe. Let's start from our solid foundation to build on. The left side, you can see the accounting industry, how big is in Finland and how is it growing, about 55% in a year. The middle figure, you see Talenom revenue, and we are growing about three times faster. The right side, you can see the development of Talenom's operating profit.
As you heard just Matti's presentation that it's in on very high level. The company is in good shape, and we have the good foundation to build on. We have a proven strategy and strong track record, and during this first period, 2015, we created our own digital platform. We made digital transformation from the traditional business model to digital business model. This will include all the process development, internal process development. It also include the platform which include the customer interfaces, Talenom Online, Talenom App, and also Talenom own bookkeeping software. We adapted the first full version of the Talenom bookkeeping products online at 2015.
After that, you can see that we have the success story in Finland, that we can see the impact of the digitalization breakthrough on performance in Finland. You can see that our EBITDA margin has like tripled and also what you don't see here is that at the same time our employee and customer satisfaction has improved very well also. Like customer turnover has increased and so on. This is the success story from Finland, and now we see that the same kind of situation is in whole Europe, that the digitalization will really happen, and we are going to duplicate this success story what we have in Finland, also in new countries. Our medium-term financial targets are, the first one, annual net sales growth over 30%.
The second, annual EBITDA growth over 15%, and also increasing EBIT in EUR and increasing dividend per share. We are well-equipped for future growth. We have very strong position in Finland and we have strong profitability of our core business, as Matti just told. We have the best-in-class digital capabilities and platform in place. We have the experience, and we have got some of the first signs of internationalization journey. Now we really believe that it's time to accelerate our growth. We have enough experiences that what this will really mean. We don't have seen any barrier that why this would not be possible. I'm telling later on more about the digital transform, what this really mean.
Some idea from this slide is that our growth will be based on acquisitions, our active sales, and digital sales. In the short term, this means that we are really boosting our acquisitions and the longer we go, we hope that we can change our business more and more to organic growth. Right now we are growing via acquisitions and active sales and digital sales. The last one, digital sales, is what we have developed some years, and we see huge potential there because it's the most scalable way to grow later on. No big changes. We will continue to execute our current strategy with increased focus on growth. Our vision is that we want to offer unbeatable accounting and banking services for small and medium-sized enterprises. Here is the one-pager.
You can see that there is three countries, Finland, Sweden and Spain, where we have business just now, and we are exploring new markets. Our competitive advantage is based on these three things, easy routines for our clients, internal effective automation, and after that it means that we have more time with our clients and it offers, it supports our upsell and add-value service possibilities. Here is some steps, how do we see that this digitalization will really happen? This is more like a law of nature. The digitalization will start from the customer perspective. When the customer will start using some platform, it will make the customer life easier.
It standardizes the workflow from clients to accounting office, and it's also an enabler for like e-invoice and some other structured information. After that, it's easier to make automation, and it becomes possibilities because the clients are using the same platform that the accounting office are. The third step is the care and upselling. When we have automated enough our processes, it means that we save time, and we can share the saved time with the clients, and it will support our upselling possibilities. Here is some indicative picture of the situation where we are just now in three different countries. In first category, there's Finland, in everything is green-led.
In Sweden, we are just now adapting our customer interfaces and bookkeeping software, and we have also value-added functions like in Spain we have also. In Spain, we have very good position there, and as Matti mentioned, we have our own platform there from the customer perspective, but we are using their commercial bookkeeping software, so we see that we have the huge potential for automation also in Spain later on when we adopt our own bookkeeping software also there. This is like the indicative picture, and maybe it will open like the situation where we really are just now. Okay, why to accelerate faster later on? The first step is that there is so many legislation and market trends which are boosting digitalization.
Here's the link also on the presentation that you can. It'll go through to our investor website, and there is the. You can read more about the legislation there. There's many, like, e-invoice standard that how the different European countries are adopting e-invoicing. The many countries has made the decision that, okay, like in Spain, 2024, big companies, and 2026, all companies have to deliver invoices via e-invoice. This will be the mandatory, and this is the big driver, and it will mean that you can make the invoices via paper and pen or Word or Excel. You have to be some software that you can really send the e-invoices. This will increase demand of the software. There is many other trends also.
Okay, the second one is customer behavior is changing to a more digital platform. As we have seen in private sector, we want to use applications anywhere, and the meetings we are going via Teams and Zoom and so on. The third one is that digitalization is really happening just now. Choices between platforms are being made, and the barrier to switch is proven to be high, and that's why we believe that just now is the time to accelerate our growth and go forward. Okay. Here is the picture, and it's like there's the number of the companies divided with the number of the employees in those companies. So we can see that there is, like, over 50 million enterprises in to countries. This is our estimation that maybe 90% of those enterprises, they have not chosen platform to use.
I mean that they have not chosen the platform which they are shared with their own accounting offices. The shared platform will offer these benefits and for automation and for improve efficiency. This based our own research and experiences that there is very traditional way to do the bookkeeping in Europe. Everybody is saying, of our colleagues in the other countries, that this will change. Everybody is like speaking about that this will change. We also know that and also some research support this idea that the big companies, corporates, the digitalization level is very high, but the smallest ones, it's very low. The smallest one is the biggest group, and it is on change.
These customers' behavior will be changed in near future. Our success story based on that is we have made this digitalization and this will happen also in Europe and around. During this period, we have saved over 80% of user time for accounting process in Finland, and we believe that this will really happen also in the other countries. We want to be the part of that, and we want to make it happen also. Okay. Some phases of our internationalization. Here four phases. The first one is exploring. It takes about 12 months, market analysis, networking, and so on. The second phase is like the bridgehead position.
It means that we have made some first acquisition, and after that, it means that we can really deeply understand that how this market will really work. The phase three is growth and development mode, and we are, like, that mode just now in Spain. We have been there one and three months ago. As Matti mentioned, we have very good position now there. We have the digital sales channel there, an own platform for our clients, and we are growing our sales organization there. We will continue the acquisition very heavily also in Spain. Phase four is the time when we are adapting our own software and our service. As we have mentioned, we have a service as a service which will include also platform and services.
This means that our technology is in vital processes, and we will continue the strong growth and profitability. Sweden is in the latest phase, and now we are adapting our own software for the first offices and later on new offices will come also for this project. At the same time, we will continue the acquisition also in Sweden, so this like integration process will continue many years for future. Okay. Shortly, my recap. The first point is that we have succeeded in the Finnish digitalization journey. The second digitalization is happening right now in Europe, and that's why we are accelerating our growth. The third one, we want to duplicate the Finnish success story in European countries. I have one more slide before the questions.
I want to release our latest version of the Talenom App. Why, okay, so many investors has asked for me that what this digitalization really mean? Here is the picture what the digitalization will mean in the real life. It means that you have accounting office in your pocket. You can make all main daily routines in on mobile phone. You can read more about that from our website. Thank you. Now is time for questions. Also in Finnish. Thank you.
All right. I guess I will begin. This is Juha from Inderes. Of course, my questions are regarding your growth strategy or the new financial targets. First of all, growth of over 30%, in this period, could you tell us a little bit, how much is going to be organic, how much is going to come from acquisitions, and how much has been allocated to new business areas like, well, micro, small, business segment?
I can start from the first one. Our organic growth will continue as it has gone, and the boost will come from the acquisitions. In the short term, the acquisition is the main driver, and the little bit longer, mid and longer term, this organic growth, we believe that this will take the bigger part. In the long term, this scalable, the small business one will be the big part of the growth. This is the way how we think about just now.
All right. The critical thing is that, when you are now sacrificing profitability in the short term in addition to get the growth in the long term, how comfortable and what is your confidence level on that you can, do what you have done in Finland, and in three years' time, these acquisitions that you are doing in Sweden are actually as profitable as, Talenom Group?
Yeah. Yeah. We have only experiences from Finland, and this is the best experience what we have. The time will be start calculated from that start point that when we really adopt our software. Now we are adapting our software in some offices in Sweden, and those offices will achieve the same level of profitability as we have in Finland core business during three years. This is the best experience what we have. Of course, we know that this the part of the acquired business will be the bigger all the time, so that's why we also will focus more about this integration processes and we try to be more effective also there.
You don't wanna say how confident or how. What is the level of your confidence in this?
It's high. We believe that this is more like our internal process in our own hands.
All right. Thanks.
Yeah.
One more from me and then I will share the microphone with someone else. I'm just wondering about the growth angle because earlier I think that Spain was more focused on SMEs and they had their own platform. Now I watch the phases of internationalization slide and it's kind of in the same path as Sweden. Is it going to be in the same path that eventually you will get your own software there and do what you have done in Sweden and go to scale? Is it a different angle in Spain? How about new countries also? Is it going to be like Sweden or is it going to be in Spain or are they actually the same?
Yeah. Maybe some differences. Of course, we have learned something from Sweden, and we try to do things faster in Spain. Of course, we are lucky that we have our own platform, our own place just now in Spain. It means that we can really. We have also digital sales channels there because of the Nomo acquisitions. We have many things in place just now. We want to achieve bigger position in Spain, and Spain is just changing just now from the traditional to digital way. That's why we are also continue the acquisition there. We are focusing on the small ones also in the near future, but also we are going to acquire some offices which are delivering the services for mid-sized segments.
Because we know that so many clients will start from the small companies, and later on they will need more services. That's why we think about that we have to be the both of service level also in Spain. It's like we are making the acquisition, but also we have the very good team to growth organically there. Yeah. Thank you, and next one.
Thank you for your presentation. I'm Emil Immonen from Carnegie. I'd like to continue a little bit on this, growth and turning companies profitable. You have acquired quite a lot of companies and you're going to increase that going forward. What's your capacity on turning around this? How many offices can you do simultaneously?
Yeah. Good questions. We have hired some people for supporting this acquisition, and we have a good team now in Sweden. As you have seen, we have made so many acquisition there and we will continue this level or little bit accelerate that. Also in Spain we have a very heavy acquisition team there and we have very much skills to do that. Of course when we are now boosting, it means that we will hire people that we can really handle these acquisitions. Yeah.
Okay. Thank you. A little bit regarding that as well. You said in your targets that you want to increase the dividends per share. Now that you're going after growth, why are you simultaneously want to increase the dividends? Couldn't that be put into growth as well?
This is what we have done previous years, and we believe that this will continue. In our estimations, we have seen that this is possibly possible. Maybe, Matti, you can open more about the funding reserve, what we have, and how we are going to do the acquisition and funding this growth.
First of all, about the dividend, why we want to increase the dividend is that we want to serve as many investors as possible that some think that the growth is really important and something that they also want the dividend, especially the small investors, they like the dividend. That's why we are also having that. Also, we are using our own share when we are acquiring the new offices or new acquisitions. We are going to use our own share also there that we don't have to use cash that much.
Of course, in this situation when the interest are going up and down, mostly up, but anyway it's worthwhile of using our own share there as well.
Thank you. One more question regarding the small customer concept. Do you have any numbers on your conversion rates, so of new users or, people who register for the service, how many become paying customers?
We have not released that. We have said that it's between 15%-20% of all customers what we have got, they are on paying customers. Now we are seeing that most of them are, like, on the service customers also. Yeah, this is what we have said. Yeah.
Jouni Kokko. Let me ask about banking which features quite prominently in your vision, and banking and payments and cards and all that, at least in theory, is a fairly scalable European business and platform unlike accounting. At least before I got an impression that you're looking for a scalable banking and payment solution together with a European neobank which could be scaled to all your target countries. Now you have announced a local cooperation with a smallish Finnish player. Does this mean that payment and banking services become a more local service to you as well, and you have sort of identified that it cannot be scaled to the extent that you may have believed before?
Yeah, good questions. Yeah, we tried to do this with other current provider and the main reason why we are changing this partner is that we need the local IBAN, and the current provider doesn't have capabilities to do that, and also reference number was the other reason. Maybe we need local partners. Maybe this is the right assumption. Now we really want to do this first in Finland, and in Spain we have the partner. The Nomo has a partner with the other provider. So we have in place this banking service also there. Yeah, from the bank card and credit card point of view, we are delivering the.
It's authorized from Visa or Mastercard, and the single European payment area is the same. From the technology point of view, if we can make the payments in Finland, it means that we can make the payments also in Spain and other euro areas. But yes, we need to partner around these banking services. Yeah, that's true.
Well, perhaps a short comment on acquisitions since there's a fairly heavy emphasis on acquisitions and growing through acquisitions. I mean, what is the market like for acquisitions and the price levels you need to pay in let's say Finland, Sweden and Spain, and how you see the situation developing when we seem to be heading to the worst times in terms of the macroeconomic situation?
Do you want to answer?
Yeah. As you can probably notice that we are not doing acquisitions in Finland that heavily anymore, and we think that the market is a little bit overheated at the moment in Finland. We can do at a fair price a little bit smaller offices, but it's a slow development and also the integration work is a lot heavier compared to the size of the acquisition. When we move on to a little bit bigger offices in Finland, they tend to be a lot expensive and there is a lot of competition also. That's why we are a little bit reducing the acquisitions in Finland. In Sweden, apparently at the moment it seems to be that it's quite good market for acquisitions.
We can do there in fair prices. Let's say the multiplier of EBITDA will be something around 4-6, and the revenue multiplier is 100% and little bit over or a little bit under, but quite fair price. We also think that even that it is on that kind of a profitability, it's still a good deal. Then we think that after we have adapted our own software we can increase the profitability there also, so the multiplier sort of comes down after that. Of course it will go in the implementation phase, it goes a little bit down, but then it will come up and will be certainly higher than when we have bought it.
Also there is quite a good basis or quite a good foundation that there is a lot of offices for sale at the moment in Sweden. That's why it like a really good market, and that's why we have made so many acquisitions in Sweden. Spain, we don't have that good experience of course because we have been in Sweden for a longer time. It seems to be that there's that it's little bit same kind of situation than in Sweden also in Spain. Yes, Daniel.
Thanks. It's Daniel Lepistö from Danske Bank. I have a couple of questions. First of all, about the Q3 Finnish EBITDA margin which contracted by some 1 percentage point from the year-over-year. Despite my knowledge that not that many acquisitions in Finland were made during the last 12 months, and if there was done some acquisitions, those were quite small and, in my opinion that wouldn't have, you know, affected the margin negatively that much. Was there anything else in the kind of soft margin in the EBITDA level in Finland, or was this done in Finland or-
In Finland. Yes, there was a little bit extra income on the previous period or the period in last year, and there was also those acquisition extra costs what we have and was pointed to Finland, not to the countries that where we are making the acquisitions. Those were quite heavy. Also that we are kind of supporting the other countries as well, and we need the recruitments in Finland. All the recruitments in Finland doesn't necessarily mean that they are for Finland. They are also for future growth in Spain, and Sweden and so on. That's also the reason. If we just keep it like that, it is certainly in very good shape this Finland profitability.
Yeah. That was helpful. My second question is about this sort of first feedback from these end customers in Sweden and Spain. You discussed that you have some customer interfaces already in place in these countries, so have you received any, you know, first feedback back from these actual end customers? Any constructive criticism or positive notes?
You mean that they are-
Just-
... testing our-
Yeah, in terms of.
Yeah
Talenom Software, yes
Of course. Everybody who are working around the software project know that we are getting feedback all the time, and the first version what we have adopted now is. From the customer perspective, it will include Talenom Online, and there is one place, Talenom sales invoice, and now we are adopting payment services. It's basic, the sales invoicing basic for the Finnish software, and it's most of maybe 95% of it is the same, and that's why the maturity of the software is very high. Of course there is some details where we get the feedback, but not any more.
The initial customer experience has been good, I mean, in terms of these other software competitors that you might have in especially in Sweden?
Yeah. I think so, and maybe it's so early to say that we don't have so much statistics that how we compare Talenom interfaces and Fortnox interfaces and so on, but not any big challenges there. Also we have started from the customers that are not using that much any software.
Like-
That's also the reason that why we are not getting that much feedback from there at this point because we have started of course from the customers that are, let's say, easier to change into the system. That's why it's also positive message for them because they can have the software, yeah. Yep.
All right.
Yeah
About these depreciations from acquisitions and the software investments that will increase the depreciation levels, how do you see the software CapEx growth in this new strategy period? Will it, you know, accelerate from these current levels? Will it grow steadily? Will it be what it is or
Yeah. The big change was in 2019 and 2020 when we doubled these investments on our software, and it will be more moderate, but I cannot say for sure that we are not increasing our investment levels. It depends what comes ahead in different countries, but we try to keep it more moderate. We are not going to do that kind of a thing anymore that we are doubling it. It will have too much depreciation of course. It will be more moderate, let's say that 10%-15% that the CapEx is raising so that it's significantly lower than the revenue growth.
Yeah. 10%-15% CapEx growth in the software?
Pardon?
10%-15% growth on the software CapEx annual?
Around there somewhere.
My last question, are you planning to sort of give further information related to this PPA depreciation on the acquisition-related depreciation and/or report the EBITDA margin in the future?
Sorry, I didn't get-
Are you planning to report EBITDA margin without the depreciation?
No, we haven't planned that. I don't know. I don't know. I don't really see the benefit of that much bringing. We are now bringing EBITDA in our measurement already. Third measurement for the profitability, well, to me it would be even too much, but I don't know if the investors like it. Maybe then, but we haven't get any feedback from there that we should follow that.
All right. That's all from me. Thank you.
Thank you.
Nonimorius. Ultimately, you have to sell in Sweden to get the profitability. You have to sell the organic growth there because you get the software, and then you sell it up and fulfill the profitability. When will we see the evidence?
Yeah. That's good questions. We have to follow up the base cases, the first accountant, the first team, and how this figure will really develop. Current experience that we have from Finland, we see that in the first six months, the efficiency will go down, and after that it will start. It will achieve the same level after, like, six months, and after that it will increase. It means that we can see the efficiency, so it means that we will have more revenue per accountant, and it will mean that we succeed also in acquiring new customers, and we can put these new clients to accountants list. That's why it's not. This is good questions because this is not only like, technical issue.
Of course, we have to resolve the technical things, but the effectiveness will come later on when the accountant is comfortable with the new software and she or he can really add new clients and after that we can see the results, and that's why it takes three years. Of course, we try to shorten this period because everybody knows that on this accelerated growth, this will be the big part of that, so that's why it's so. We have so high incentive to focus also for that how we could be better all the time for their.
You have now already built the sales force there, or are you doing it the next year?
Yeah, yeah. Yep. Yes.
It's already there?
Yeah. We have sales organization in Sweden, in Stockholm, and we are doubling in this year and also next year. That's the plan, that we are all the time growing faster via active sales organizations.
Okay. About the digital sales, every time I open a browser, I get a TiliJaska advertisement, so I hope it's bringing benefits. Do you have evidence on that in Finland? I'm not hoping in Sweden, but maybe in Spain as well. Where do you have the evidence now?
Yes. We are getting like the same level of the new clients, and we have learned so much about the digital sales that how it really works, and we have made some adjustment to our TiliJaska website and we are getting better now the visitor's name, the email addresses, and after that we can make the after marketing for that and trying to get those visitors to our users and so on. There's many conversions points what we are following and where we are making changes and trying to get these clients also to paying clients, not only for the users. Yeah.
You have the evidence?
Yes, we have evidence.
Okay
for that. Yeah. We are now comparing TiliJaska experience also for normal experience, and now we have two teams which are doing, like, the same things in two markets, so we can share the experiences and the best practices for that. From the theory point of view, we can see that we have good results that how many new clients we are getting from the visitors, what's the conversion, and how many of these marketing qualified lead is really going to sales qualified lead, and how many of them will be the subscriber, and so on. Yeah. There is many small details what we have to develop all the time. Yes, we have. You have seen TiliJaska many times.
All right. Final one, seems to be that the platform selection, as you said, it's.
Yeah
It's tough to choose and even more difficult to change.
Yes. That's true.
I have a feeling that Sweden is almost a lost case. There is a dominant player there. Do you have any hopes to get a significant share there? What about Spain? Is there a dominant player already or are you it?
Yeah. The Swedish market is more competitive than Spain. The highest competition level is in Finland. Our experience is that about 80% of current customers what we have acquired in Sweden, they don't really use so much Fortnox or some other software because there's many reasons. That's why we think that the 80% of acquired companies we can adapt our software easy. These are the smallest one, and the biggest one, they have used it so long time, Fortnox or Visma or some other.
Maybe they will continue to use that, but our growth will be based on that we are like really selling this service and platform at the same time, and we see that as we have seen now in Sweden, so we can close sales like double volume per sales guy in Sweden compared to Finland. This is the real situation now in Sweden, how our active sales is ongoing there. This is the good feedback for us, and that's why we are doubling our sales force there. If we compare to Spain market, there's many small platforms, but not anymore big players there. The situation is like saying what we had 2005 in Finland, we had Talenom, Netvisor, Heeros, Maestro, and maybe Procountor was just establishing just that time.
It's like this kind of situation from the market point of view. The development will happen so much faster because of the mandatoriness of the e-invoice. That's why we want to go with the platform and try to get the users, and we know that they don't want to. When they have to choose like new mower, so they don't want to change from Stihl team to Husqvarna team. They will continue to use Stihl. It's like the same thing.
All right. Thank you.
Thank you. Any more questions for audience?
Yes, there is on the webcast platform several questions both in English and Finnish. I'll start with the English ones. Matthias asks, "The majority of your acquisitions during the last years are financed mainly through directed share issues. As a result, the increasing revenue and EBIT in absolute terms dilutes on an ever-increasing number of shares. Consequently, despite higher revenue and EBITDA, the earnings per share in Q3 2022 is actually lower than Q3 2021. In the short term, this means that the international acquisitions are destroying shareholder value. Questions: Should we expect lower year-on-year EPS in the coming quarters? Don't you think you should put more emphasis on EPS in your quarterly reporting, as this is the key figure reflecting shareholder value creation?
Yeah, that's true. The EPS went down in the third quarter, but if we look at the full period, it was increasing, the EPS, and we have several scenarios and that this EPS in future that it will grow, but of course that will be growing more moderately, and of course, the interest rates will affect on that, and unfortunately, we don't have any tools for the to influence on the interest rate which will have an impact in our net profit. So in that terms, it's a little bit out of our hands, but we have calculated that the EPS should rise in future.
Okay. Martin Hammarström asks, "In Finland, I guess that Talenom's accounting software was the first cloud service many customers used. In Sweden, most will switch from, Visma's or Fortnox platforms. Will Talenom's accounting software be good enough? Will you have to offer a lower total price to make the customers go to Talenom's Swedish software?
Yeah. We know that the clients are using the software that accounting offices are recommending. As I mentioned earlier, we have seen that like 80% of our current clients in Sweden, we can adapt easy our own software there, and some key benefits that we have in Talenom Online is that it's very easy to use. It's so simple. Maybe there is not so much features, but most of clients, it's very easy to use, and this is our like main competitive advantage of the software. Yeah, they are getting the software and services from the one place and we have the whole support also to end user from the customer perspective from the software perspective and from the service perspective. We are like delivering the whole package.
Our clients doesn't need to ask any more from the software provider, so they will get all answer from us. Yeah.
Martin continues by asking, "How many acquisitions can you make in Sweden in 2023? What can you say about the competition from other big players to buy smaller firms?
Yeah, we haven't really announced the number of acquisitions. Of course, it depends on the size of the acquisition. We just recently made the deal with Mazars, which was around SEK 50 million. The smallest one we just had, it was much smaller, five times smaller than the Mazars even smaller. We haven't really announced that how many we are doing there. Yeah, that's all about that.
Given a continued M&A and investment, what margin level should we expect as the base level, EBITDA or EBIT margin?
EBITDA margin, in the acquisitions, we are looking mostly on the EBITDA margin.
I'll switch to Finnish. Wilsu kysyy Ruotsissa tavoitellaan ajan kuluessa korkeampaa kannattavuutta. Onko mahdollista, että kannattavuus jäisi pysyvästi Suomen kannattavuuden alapuolelle? Mitä tähän liittyviä riskejä sijoittajan olisi hyvä ymmärtää?
Ehkä tavallaan tuohon Ruotsiin sellainen, että siellähän on niin kun hankittu yritysostoilla ja niillä on tapa toimia, ja nyt me ollaan muuttamassa sitä tapaa. Tämä on hyvin samanlainen prosessi, mitä me ollaan nähty Suomessa, että kun ostetaan yritys, niin me integroidaan sinne Talenomin palvelumallit ja softat ja niin edelleen. Tuota, meidän arvion mukaan 80% noista hankituista toimistoista meillä on aika helppo muuttaa niihin omat softat ja niissä saavuttaa se Suomen tasoinen kannattavuuskehitys. Totta kai jos me katotaan ydinmarkkina, Suomessa on oltu pitkään, niin meillä on täällä kaikki toiminnot, niin kun pidemmällä tukitoiminnot ja johtamismetodit ja kaikki yhtenäiset toimintatavat. Mutta nyt me ollaan niin kun näitä kaikkia viemässä sinne Ruotsiin, ja ei me olla nähty tavallaan semmosta niin kun mitään estettä, että miksi tämä ei voisi tapahtua.
Tää on enempi meidän käsissä ja meidän johtamiskyvystä viime kädessä kiinni, että miten me siinä onnistutaan. Nyt kun me ollaan päätetty, että me jatketaan voimakasta akkvisitiokasvua, niin meillä on myös erittäin korkea niin kun kannustin, niin kun tehdä tämä vielä paremmin ja koittaa lyhentää tätä integraatioaikaa ja sitä kautta niitä hyötyjä sekä asiakkaille, henkilöstölle että osakkeenomistajille.
A few questions more in English. Mauri asks, "In your presentation, you listed 15 European countries that you have explored in the standpoint of size of the enterprises. In how many countries are you planning to operate in 2025? And what are the key elements when you are doing decisions related to new countries?
Yes, we are exploring now three countries. What's the perspective? The markets should be big enough and maybe also that is it possible to be an accountant of offices there? And do we need some persons who should have some certificate or not? Is it possible to get like Finnish accounting company who is running in new countries? Is this any legislative barrier around that? Maybe this is the one point. The main is this markets size and also this the way of working, how what we can really explore for the new country. The more traditional is the market, the more we have to explore. Maybe this is shortly.
Also the infrastructure level there.
Yeah
What kind of digital development we can have in the future, that it's not already too digitalized, so it might be difficult to enter that market. The digitalization has to be quite low, but it also has to have some kind of a plan or infrastructure that the digitalization will rise, and then we can also have the automation on top of that.
One more question. For the group, what is the base EBITDA margin we should expect going forward? Or what year will the base margin be achieved in? Any color on that would be helpful.
Yeah, that's a difficult question. We will give the guidance for each year, and now we have this guidance. At this point, I don't want to announce any new guidance before I talk to the board and Otto. Unfortunately, I cannot give that. Yeah.
No further questions.
Okay. Thank you for everyone. Is there any more new questions from audience? The silence means that there is no more. We want to thank you for everybody here and there online. Thank you.
Thank you.