Good morning, and welcome to the 2nd quarter results presentation for Link Mobility. My name is Tom Rogan, and I'm Head of Investor Relations. I'm joined by Gjo Van Gaer, CEO, who will present the results together with CFO, Thomas Berge. Following the presentation, we will have a Q and A session where we both can post The questions online, and you can also if you have been dialing in, you can also ask questions in person. Jan?
Thank you, Tom. Great to be with you this morning to present the key highlights of the Q2. For us, the Q2 2021 was very important because It is the milestone for us to move from being the leader in Europe of CPaaS offering to become a global player. With the closure of the acquisition of Message Podcast and the contemplated acquisition of Soprano, not only do we add the U. S, but also Latin America and Asia Pacific.
So this is really exciting for the Q2 2021. Also, we have and we will be close to reach certain milestones from a revenue perspective and EBITDA perspective. When you look at the pro form a last 12 months, we've reached now CHF 4,300,000,000 on a pro form a basis And then adjusted pro form a EBITDA of CHF 622,000,000 Taking into account Soprano, that will add CHF 683,000,000 in revenues And NOK182 1,000,000 in EBITDA, so really changing the scale of the company, not only from a revenue perspective but also from a profitability standpoint. We're also very happy in this Q2 2021 to actually having delivered on our M and A strategy that we have presented to you during the IPO. We have indeed closed 5 acquisitions since IPO.
We can name WebSMS, Tisme, Marketing Platform, Message Broadcast And also AMM in Italy. 2nd important point that we would like to mention is, of course, that As planned, the Q2 of 2021 has seen a strong boost in terms of revenues. When you look at it from a non organic standpoint in local currency, it's 23% growth that is explained clearly by the reopening of society and the fact that the Q2 last year was definitely impacted by The coronavirus situation. When you add the acquired entities, our reported revenue growth was 26%. For the Q2 2021, we have also reported an adjusted EBITDA of NOK119 1,000,000, Which is a 22% increase that takes into account the acquired entities.
When comparing and Thomas will cover this element in his presentation when When comparing to the Q2 of 2020, you have to remember that the Q2 of 2020 had strong cost mitigation measures, obviously, to take care of the pandemic situation. The last one is actually where we are super excited because When you take into account the acquisition of Soprano, we will be close to 50,000 customers. And every day, we get proof points Of these customers consuming more and more of Link Mobility products and consuming our platforms when it comes to use case extension, but also, for instance, Message channel expansion, that's the case of WhatsApp, where we have signed with Deutsche Post an agreement to expand Not only to message notifications or there will be notification, but also customer service use cases, WhatsApp has an important channel. So that is a clear demonstration that being so enterprise focused, there was a lot of value, and we'll continue to do so on an ongoing basis. We talked about it during the Q1 presentation, and let's make a few points on the Q2 2021 results.
Indeed, We knew that message notifications will hold their position because they've been very critical. But then, of course, due to the pandemic, Marketing use cases were negatively impacted. So what we saw, obviously, in the Q2 is the fact that logistics and e commerce continued to use Notification messages from Link Mobility, and that's very strong from an ongoing perspective, but also that retailers, hospitality, but also other companies We engage with the customers, inviting them to benefit from their great offers, loyalty programs and also distinct stores. So that has been very positive for us in the Q2, and we expect this to continue, especially when you look at the 3rd and even more, the Q4 of this year. We know that these products are now high demand, and now we have new channels also to offer as we will present in the next slides.
Indeed. First of all, let's talk about WhatsApp. Definitely, WhatsApp is a growing channel in the CPaaS industry, And we see growing demand for using WhatsApp for notification but also marketing communications. So we are announcing today the fact that we have signed with Deutsche Post, a WhatsApp agreement that has shown already some strong growth. Deutsche Post is the owner of DHL, and we have a historic relationship with DHL where we already expanded into new use cases, including WhatsApp.
And we are testing even new channels like Facebook Messenger and RCS for DHL. But on the Deutsche Post case, we can see that The Link Mobility platform is now enabling chatbot conversation using WhatsApp as the key message channel. When you look at the scale of this example, we know that a lot of other companies are asking us to actually expand not only To new channels like WhatsApp but also new use cases, including customer service. And that's the role Linked Mobility plays, actually. We have made some important steps towards building a more robust and comprehensive platform, now being able to carry more than 90 operators on RCS, Being able to reach customers in 200 countries plus, we've been able to deliver those enablements In terms of marketing communication, using the two way communication and the rich content of RCS.
Besides RCS, when you look at our partnership with Facebook, By the way, you can scan the QR code and enter the dialogue with the WhatsApp channel in order to keep Are your investor presentation up to date by scanning this QR code? But if you look at it from a more Through this perspective, we have a very strong demand for expanding into these new channels such as WhatsApp. And of Of course, Link Mobility is an attractive partner because we have more than 50,000 customers if you take into account the Soprano acquisition going forward. So, upsell expansion of use cases include more channels are the key themes of our growth potential going forward. But that is not the only element of our growth profile because we've invested a lot of energy these last 3 months, but since a year, In expanding our go to market channels, we are very much recognized as being the number 1 in Europe on enterprise.
We have this direct sales team, very experts, Able to cater for bespoke solutions for the enterprise customers directly. But we have this unique go to market with partner, And we're expanding now in almost all of our countries the platinum gold platform with our partners. And not only did we do that, but at the same time, we've extended our self signed up profile by being able to actually I have smaller companies connecting to Link Mobility directly without the human intervention. We have customer success managers who grow the customer over time. But these three channels combined, they give us this enhanced ability to grow our business, not only in Europe, but going forward in the rest of the world.
Just to give some color to some of these elements, we've signed 200 420 custom contracts in this quarter. But very importantly, we have signed 33 partner agreements, which themselves added 145 new Customers. So clearly, very attractive go to market drive, which will be an important element of the growth of Link Mobility going forward. Let's talk about the second strong element in our strategy presentation that we did during the IPO, which is our M and A track record. We have A very significant success in completing more than 29 acquisitions since 2014.
At Clear, M and A strategy has been really successful, and we have the ability not only to continue it, but to grow it And now I have a worldwide perspective on M and A. But let's give these three examples. Whatever mobile was acquired in 2016. And you can see that we've been able to deliver, over the last 4 years of the acquisition, a 22% CAGR on EBITDA, which is outstanding, we've been able to leverage the relationship with certain key customers and expand the use cases. And you can see now the example of WhatsApp with Deutsche Post.
If you look at net size, also this acquisition in January 2019, we've been able to I have very significant growth on the EBITDA, 130%. On the revenue standpoint, you can see the impact of COVID, especially in France, But the growth rate has been really strong, and we've been able to deliver value for our shareholders. More recently, WebSMS, We've been able to have an outstanding performance on growing the business, combining our Austrian entities Together, as we had already, an Austrian presence and also delivering very strong financial results for our shareholders when looking at revenues and EBITDA. And this is only three examples out of the many acquisitions we have done. So we are going to continue focusing on M and A to deliver growth for our customers.
In terms of those very last M and A deals that we would like to mention, of course, let me start with Message Broadcast, which was A transaction closed on the 24th June 2021. We're very excited about the acquisition with extremely high net retention At 150% plus, plus a very deep solution embedded into key verticals such as utilities, but also health care. And you can see that the package that is offered by Message Broadcast commands a very high level of profitability and very strong Net retention scores. So we see that with the experience of Link Mobility and the passion of the message broadcast team, we see very attractive prospects along the way for Link Mobility after this acquisition. We are also making great progress in finalizing the Soprano agreements.
So Plano is a very sizable company being represented in many different continents in Europe, in U. S, where we are now present, but also in Latin America and Asia Pacific. We've seen very strong Capabilities from a platform perspective, the due diligence has gone really, really well. And we are expected to sign the Sperry very soon. And you can see on the right side some of the key elements and KPIs of the Soprano.
So when you look at the acquisition of Soprano and Message ProCast together, that is really a changing of the scale and the presence of Link Mobility. Let me then Before we get to the presentation of the financial numbers, finish by reiterating our forward looking statements for 2024. We are guiding with a pro form a revenue of NOK 10,000,000,000 and pro form a adjusted EBITDA of 15% to 17%. This is an up from the previous range, which we gave you, around 13% 15%. And we think that After the acquisition of Soprano, we are going to raise the guidance forward with an 18% to 20% EBITDA margin, which is really an outstanding number in our industry.
We have also kept some important key assumptions for the delivery of this Forward looking statements. The continuous organic growth rate of 20%, which we intend to reach With the effect of the go to market, but also, as we said, the tailwind of the new CPaaS channels, such as WhatsApp and other products, of course. Not only this is going to help us, but we are going to be able to increase the margin through the higher leverage of the operation And bring some additional M and A to complete the picture of Link Mobility on a forward looking basis. Thank you very much for listening for this first section. And before We go to the Q and A.
Of course, let's invite Thomas to present the key elements of the Q2 results. Over to you, Thomas.
Thank you, Guillaume. Let's start the financial section with a look at revenue development. Link reports all time high quarterly revenue of SEK 1.55 €55,000,000 a 26% growth including M and A and a 23% organic growth in local currency, Excluding revenue from acquired entities. In the current quarter, Link closed marketing platform in Denmark AMM in Italian message broadcast in the U. S.
In the reported numbers, marketing platform MAMM are included as of June 1. While message broadcast, which closed Late in June, we'll be included in the P and L from July 1. The appreciation of NOK towards euro and other currency reduced The reported growth rate by 8 percentage points. As I said, organic growth rates in the current quarter in local currency was 3% and above the 20% medium to long term revenue growth targets. The underlying revenue growth It's progressing according to plan and increasing over time with additional growth momentum generated by go to market initiatives.
Link is rolling out additional products and sales capabilities in less advanced markets by investing in additional salespeople, Partner managers and implementing new self sign on solution to advance our position in the SME market. In the quarter, additional growth was generated by reopening of societies. As stated in the Q1 reporting, the company Served a material reopening effect in April after strict lockdowns throughout Europe during the Q1. In the current quarter, enterprise had adapted quickly to society's reopening, accumulating and need to reengage with the end users to restart normal business activity. In addition, the Q2 of last year saw revenue development negatively impacted by the initial lockdown, Mainly in Western Europe and Central Europe.
The organic growth rate for the first half of twenty twenty one is reported at 15% in local currency. Messaging volume growth, including acquired entities, was 37%, while reported organic Messaging volume growth was 28%. The higher message volume growth compared to revenue growth It's due to increased revenue from the low price aggregator segment compared to the same quarter last year and a stronger reopening effect in Western Europe, which has a lower price level compared to the other regions. Over to the next slide. As Guillaume said, Link has delivered on its M and A strategy as communicated in the IPO process.
The company has been transformed from a European CPaaS provider to a leading global CPaaS player. Since the IPO, the company has closed 5 acquisitions: WebSMES in Austria, TISM in Netherlands, marketing platform in Denmark, AMM in Italy and message podcast in the highly attractive U. S. Markets. Additionally, a firm term sheet was signed in May relating to the acquisition of Soprano Design, which will increase Link's footprint to Latin America, Asia, AustraliaNew Zealand and further reinforce Link's position in the U.
S. And European markets. You are expected to sign the SBA on the Sopranum transaction shortly as the due diligence is finalized and no red flags have been discovered. M and A has enlarged and transformed Link. And to give a better representation of the financials for the combined entities, Several pro form a KPIs will be disclosed as of this quarterly reporting.
Pro form a figures includes Historical financials of closed entities for comparable data. All acquired entities are included in the pro form a figures, except Soprano Design As the acquisition has not yet been closed. Pro form a organic revenue growth was 25% in local currency With similar momentum to reported organic revenue growth. There is a strong demand for CPaaS products in the markets As enterprises are looking for new and better way to communicate with their end users. The richer feature set of OTT channel like WhatsApp and RCS It's appreciated by the market and pushing exponential market growth for these solutions.
Link has a leading position in the evolution of the CPaaS market Documented by large global enterprises like DHL and Deutsche Post choosing Link as their CPaaS vendor. The pro form a organic revenue growth was also helped by reopening of societies, as explained on the previous slide. Pro form a enterprise revenue growth was reported at 20%, and the aggregator segment increased total pro form a revenue growth with 5 percentage points. In the Q2, the aggregator segment experienced increased growth momentum with the reopening of societies And ad hoc volume increases to selected destinations. The number of customers have increased with Almost 2,000 customer accounts.
This is driven by the go to market initiatives. Linked now has almost 44,000 customers account, Including all closed entities. Pro form a net retention rates include closed acquisitions to give a better overview of the growth momentum for all Listing clients. Historical
overview for
the last four quarters is included in the two charts at the end of the slide. Net retention rates will be reported in local currency to highlight underlying growth derived from existing clients. The pro form a net retention rate for the Enterprise segment was reported at $117,000,000 and has increased over time. Total pro form a net retention was 120%, with aggregated volumes experienced a pickup in growth levels in the current quarter. Over to profitability.
Gross profit was reported at NOK268 million, a growth of 22%. Pro form a organic gross profit growth is 12% in local currency, and the gross profit margin is 25.4%, Which is a decline of 0.8 percentage points. Gross profit development compared to the same quarter last year It's negatively affected by higher revenue from the low margin aggregator segment, which dilutes margin in the current quarter. Additionally, special circumstances last year connected to the initial lockdowns, mainly in the less mature markets in Western Europe and Central Europe, With lower gross profit compared to the more profitable Nordic region resulted in higher margins on average being reported in the Q2 of last year. Reported adjusted EBITDA at NOK119 1,000,000 and the margin at 11.3%.
The 2nd quarter margin is not fully comparable year over year as cost savings of approximately NOK10 1,000,000 Was implemented last year as a response to the uncertainty created by the pandemic. All cost saving initiatives were rolled back late 2nd quarter and early Q3 of last year. So in pro form a figures, LTM pro form a figures as of the Q2 are displayed in the table to the left with separate columns for reported numbers, Additions from closed acquisitions and then Soprano. Current run rate LTL number for revenue, including all entities, Indicate year earlier revenue of more than NOK 5,000,000,000 and a gross profit of almost NOK 1,700,000,000. Gross profit margin at a healthy and stable 33% and an adjusted EBITDA at over NOK 800,000,000 with a 16% margin.
The LTM number for all entities documents the transformation of Link to a sizable global CPaaS payer. Next slide summarizes the Q2 figures in the P and L overview. We have been through the headline P and L figures in the previous slides. So I'm jumping straight to the lower half of the P and L. Nonrecurring costs are impacted by Link's share option program and M and A activities.
Share option costs of SEK40 1,000,000 and M and A related costs of SEK35 1,000,000 connected to the Acquisition process of Tismi, AMM, message broadcast and Soprano. There is a small amount related to restructuring cost of SEK 6,000,000. The reported share option costs are the accounting treatment of a future dilution effect With no short term cash effects and only a very limited cash outlay over time of approximately SEK1.3 million related exclusively to Social Security contribution. Cost of depreciation is reported at SEK69 1,000,000, Which is mostly related to the depreciation of assets from acquired companies following purchase price allocation. Balance sheet is solid with a strong liquidity for the 2nd quarter.
Total balance sheet of almost SEK 10,400,000,000 with an equity ratio of 49%. Working capital is negative, Meaning Link's clients and vendors are financing the organic growth. Message broadcast will, however, affect the future development as The company has a positive net working capital due to its business model. Net interest bearing debt At NOK2.9 billion, which is an increase in the second quarter due to funding of the acquisition of Message Broadcast. Link has significant cash reserves of over NOK 800,000,000.
Looking at the leverage. After the closing of the transaction with Message Podcast, leverage will temporarily be higher than the financial policy dictates. The financial policy is unchanged, and the company have the highest focus on pushing the leverage below 3.5. Leverage as of June 30 is 4.7 and is expected to go down closer to 4.0 after closing the Soprano acquisition. Organic growth in the 3rd Q4 will further push down leverage as adjusted EBITDA increases.
We expect to be closer to SEK3.5 million in leverage by the end of the year. Net cash flow on the next slide Shows $87,000,000 from net operating activities, significantly higher than same period last year. Link will have a cash surplus after deducting interest cost and CapEx from net cash from operating activities, which will be used for further acquisitions. Closed acquisitions during the quarter and connected cash outlay are listed on the slide. Funding of the acquisition was done through the tap issue of the existing bond of €170,000,000 That's it for me.
I'm handing the word back to Tom to take us through Q and A.
Welcome to the Q and A session. We will start with the direct questions and take online questions if they have not already been answered at the end. Operator, please help us through Q and A.
As there are no questions at the moment, I'll hand the word back to
the speakers.
We have some online questions, and I will ask them to Guillaume and Thomas. So the first questions we have from Hey, Stijn Loggaard from ABG. And he asking about the second quarter saw some one off catch up effects. Do we expect to see something similar for it in the second half or more normalized volumes?
Hi, Horst Heijn. So thank you for this question. So I think we have communicated in Q3 2020 some of the multi changes we saw as an impact from the pandemic. If you remind if we remind you about some of those data points, we can say that heavily impact It took place in April 2020, very significant reduction due to the close down of society, Also the case in May. And then we had a strong rebound in July.
So July 2020 was actually A very strong rebound because a lot of companies that we engage with the customers and also at the beginning of August Whilst the 2nd wave also impacted basically Q4. So we think that there is going to be on a net basis a catch up effect, But this is not to the same scale that we saw the Q2. And we know that also within each month, there was different patterns of Impact also in different regions. If you look at the pandemic impact, of course, regions were impacted differently. You can see that in our Q2 numbers, for instance, in the catch up of Western Europe, in the Q2 of 2021 versus the Q2 of 2020.
So normalizing everything is not an easy job, but we expect some level of catch up, probably a little bit more in Q4 than in Q3 due to the strong July month And beginning the loggers, which were kind of strong in 2020.
Then I just want to ask a couple of follow-up questions regarding our recent the large acquisitions. For for Message Broadcast and Soprano. How was the performance in the Q2?
I can start answering that, Tom, message broadcast performed according to the internal plans for the Q2. We are not reporting details on Message Podcast nor Soprano for the time period before we Own the company. So things are going to according to plan for message broadcast. Also for Soprano, as you see in the Per form a overview, we are stating Q2 numbers for Soprano as we haven't closed it And we wanted to give the investor community an overview of all entities, not just the performance figures from closest acquisitions. And the Performance there is also according to plans and historical overviews.
Then we have a question from Mats Rosendahl and it's regarding the relatively high leverage due to our recent acquisitions and how we will deleverage.
I can maybe also start that, Gjo. Leverage is higher now temporarily and due to the message broadcast acquisition. We knew that we had the Soprano also coming, so that We'll, of course, delever quite significantly without a 4.0. We have not given any sort of forward looking statement short term on how fast we can delever. But what we said in connection with going public with these two deals that we expect to be significantly lower than 3.5 within 12 months after closing the Soprano transaction.
And we as we said in this quarterly presentation, we do expect to be closer to 3.5 by the end of the year.
Then I have a couple of questions from D and D Asset Management regarding both so that we have Upon closing of Soprano, we'll be guiding the EBITDA margin to 18% to 20%. So what will be the cash flow margin on that? And also if Can you give any more specific indication on the expected revenue growth for the second half of this year?
Maybe I can start, Joon, with free cash flow, and you can comment on the revenue growth. We have not given a forward looking statement on free cash flow. I can give some sort of guidance pointing to historical figures. If you look at our adjusted EBITDA, Then of course, we have to pay taxes. As of now, they are around in a normalized year, SEK 70,000,000, SEK 80,000,000.
It will increase Due to the acquisition of Soprano and Message Broadcast, on top of that, we have previously said that we have CapEx of around SEK140 1,000,000, Which will increase slightly due to the acquisition of Soprano and Message Podcast. There is also some CapEx there. If you assume Around NOK 15,000,000 to NOK 20,000,000 per entity. And I think that's a good estimate of Current run rate for the 2 acquired entities. So you will see that we will have a significant free cash flow margin.
Historically, it's been increasing. It's been going up from 40%, 50% back in 20 eighteennineteen up to Almost 70% and above the last quarter. So we would expect a very healthy free cash flow margin.
And we have a question from Erik Eriksland. Yes.
I think we should, Tom, cover the question on Eivind on H2, just to give 2nd answer to this question, sorry. So I think when you look at H1 2021, We have basically a mix of 2 quarters. The Q1 was really impacted by the lockdowns and the restrictions on COVID, and The Q2 had the tailwind of the reopening of society and comparison with the Q2 of 2020 being made easier, of course. So on the net effect, if you look at H1, we expect similar type of growth in H2, which would be a more normal 2nd half. But if you look at the first half, combining those two quarters gives a good sense of what we would expect in the second half.
Then we can go right back to Erik. Ericson's question is regarding the CPaaS sales and how much that constitute to the total sales of the company today.
Yes, That's a very good question, and I really want to spend some good quality time answering it. First of all, in our segment reporting, you can see that we have Isolated global messaging, which represents 15% to 16% of our total revenues, and these are clearly kind of A2P Aggregated type messages that do not qualify strictly to being CPaaS traffic. And we're also selling to Companies who are reselling to other companies as aggregators. If you focus on the kind of 85% remaining revenues, And more and more of those revenues are CPaaS in the sense that they carry two way communication. They are multichannel, as opposed to Using only one channel, and they require platforms that can deliver on the security and the reporting Combined solutions.
Also, to mention another element, which is important is that our solutions can be both consumed From a software perspective, so directly connecting to the software, also APIs, which basically offers that flexibility to customers. Now we have decided that there isn't a strict definition to basically qualify certain traffic as purely A2P messaging and the other CPaaS, but what you need to remember is that more and more customers Are asking us for additional channels for two way communication for more advanced use cases. If you look at the example of RCS in Germany, in the UK, in France, in Spain, where certain companies had a one way message Using, for instance, email or SMS, now they are combining SMS and RCS with two way communication for marketing use cases. So from a reporting standpoint, we don't isolate every single euro or knock of our revenues between CPaaS and A2P. But clearly, today, more and more of our enterprise revenues are CPaaS enabled.
And we have a couple of questions from Erik Krastal from Carnegie and regarding the strong demand growth we saw in the Q2 and the volume growth and what is driving the volume growth, which sectors are driving that and also why the volume growth is higher than the revenue growth.
So, of course, a good question. So we have sectors who have been very quiet in the Q1, which actually Went back into reengaging with the customers and we've highlighted hospitality obviously, but also retail. We have also in certain countries the vaccination initiatives, which means that the Health sector is increasing. From also total revenue versus messaging growth perspective, we have two elements, is that some of the Volume growth came from that global messaging sector as we separated from the rest of the companies. And also, let's forget let's not forget that a lot of the growth you can see from new channels such as OTT, and we've gave the example of Deutsche Post, WhatsApp, And not all of these traffic is actually translated into direct revenues, but some of them are more translated into license revenues.
Maybe you want to put some addition to these comments, Thomas, on the gap between the messaging volume growth and the revenue growth?
Yes. As I mentioned in the presentation and we also written in the report, we have a large aggregator volume, as As you said also Guillaume, which then of course increases messaging growth more than revenue growth. Additionally, we are having some Special effects when we compare to the same quarter of last year because we had the initial lockdowns and it impacted negatively more volumes In markets with lower price levels, so when basically sort of the revenue comes back again, then we get a mix effect also from that. So that are the 2 main sort of reasons for the deviation.
Then we have a Straightforward question is from James Carter. Will we be pursuing a credit rating?
I can maybe start answering that. We are going to look into it. We haven't concluded if we are going to do it, but we do see that the amount of debt and Loans that we have in the bond market makes it more interesting to spend the resources and the time to to credit rating. So this is something that we will get back to most likely by the beginning of Q4.
Then we have a couple of questions from Sergey Ruiz, and it's related to the Soprano acquisition. So firstly, on the Soprano customer base. And if you give some color on the customer concentration of Soprano. And also since the Soprano acquisition is largely financed in shares, how that will change the ownership Structure of Link.
Do you want to take the first question, Thomas?
Yes. AbbVie Partners is going to have around 25% after closing of Soprano as they reduce On ShipShare. Customer concentration, it's not big in Soprano. They have a lot The revenue from partner agreements with M and O operators and behind those, there are thousands of end clients basically generating the volume. So I would classify customer concentration as low in Soprano due to the fact that we have so many different And the clients there.
I see also that there is a question if we do not close Soprano acquisition and you don't reach the 3 0.5x leverage. What happens then? Basically nothing, I guess, because we don't have any maintenance covenants In our bond agreement, so we are going to continue to grow organically and delever naturally over time. We have a limitation, of course, in the incurrence test that we cannot incur new interest bearing debt If we have a leverage of over 3.5, so that is going to be a limitation, but it's not going to limit the organic development of Link.
Then we have a question from Johannes Riess, and it's regarding our forward looking statements to reach The SEK 10,000,000,000 revenue target by 2024 and how that stacks up with growth expectations and how much M and A we need in addition.
I think our forward statement looking statement is clear, is that we are aiming to reach 20% organic growth rates in the midterm. And we will also continue to acquire new companies. And You can do the different maths and scenarios based on our M and A and organic growth post Soprano. Clearly, our M and A pipeline is still very healthy, and we have very good expansion plans on M and A. But also, as we explained during this quarter Results, strong demand on CPaaS.
So both are really confirming the fact that we are on track On delivering the SEK 10,000,000,000, that is definitely something that both Thomas and I feel very comfortable in achieving, and that's clear to us. Yes.
I can tell you also, Guillaume, purely mathematically, if you assume 20% organic growth medium to long term, then you will see that the shortfall to reach The SEK 10,000,000,000 in 2024, it's just above SEK 1,000,000,000 that we need to Phil from M&A. So we have delivered significantly
on the
SEK 10,000,000,000 forward looking statement already with the many Questions that we have done this year.
Then we have a quick question from Christian Akgeson. And it's regarding if you can explain the difference between enterprise and aggregated volumes And why Link is focusing on enterprise volumes and not on aggregated volumes?
Yes. I guess the answer to this question is that aggregators are I'm also reselling to enterprise, but they go to Link Mobility to source our direct connections and our very high quality routes For SMS International Routing, and the relationship is very different than enterprise because it's more price sensitive. And you don't sell a Solution that you sell capacity, and it's closer to a wholesale trading agreement. And therefore, the relationship is very different. As we said during the IPO, Link Mobility is focused, as an enterprise solution company proposing and offering CPaaS solutions.
But we also have this global connectivity business, which allows us not only to offer our great direct connections To other players, but also to source attractive destinations, which is common in the industry. We have some of our competitors who are more focused on aggregator and global messaging than we are Because we have defined our strategy as being very enterprise focused, you can see that on the aggregator side, there has been some Strong volume increase in the late 2020. But for us, we do not Make this as our core strategy again for Link Mobility, Enterprise is the focus.
Then we have a question from Mili Yahav regarding our how we're going to integrate the recently acquired entities.
Yeah, this is a very good question. So talking about Message and Podcast first. So, Message and Podcast is a very deep solution that has been offered To utility companies in the U. S, we're going to offer to Message Broadcast also our international connectivity that we just spoke about Because this is capabilities that they didn't have. They have, also the perspective of growing stronger into the health sector.
So that is going to be built in from the Message Podcast position. The CEO of Message Podcast is going to lead the U. S. Presence for Link Mobility going forward. And, we know that, from a personal perspective, we want to keep really, this Great team of message broadcast in California growing the business for us in the U.
S. On top of, the U. S. Presence of Soprano. So we have this regional focus now strongly starting with this U.
S. Presence. From a Soprano standpoint, Soprano He makes a great contribution to us with the ability to sell to carriers, MNOs, Which is one of the partners that we've been working historically, but not that strong. And they have really a unique product and unique track record in MNO. And that means that for us, the Soprano product and the Soprano suite is going to be offered all across Europe In order to be able to create some additional cross sell opportunities to our European partners, so we know that there are some upsell Really coming from the European MNO expansion.
From an entity perspective, we will want to keep Those entities relatively independent, with the exception of Global Connectivity because civil street and Link Mobility Global Messaging Have similar type of customers and will be merged, in the next coming month. So Different answers to these 2 different cases. We are extremely, experienced in doing the right thing in terms of integration as proven in our track record. It's all about making sure that the local team are empowered to deliver the numbers, and we try to avoid big bang Mergers, because historically, we know that this is less efficient than empowering and cross fertilizing the companies with our products And our go to market expertise, where we are bringing all of the partner program, SSU programs, Carrier Now M and O programs and enterprise know how.
Thank you very much. As we have no further questions, we thank you for your attention this morning, and this concludes the Q and A session.
Thank you very much. Thank you.