Good morning, ladies and gentlemen, and welcome to the presentation of the quarter results for the Q2 for Omda. The report together with the presentation can be downloaded from our website and from newsweb.no. This webcast will comprise an approximately 40-minute presentation followed by a live Q&A session. You can type in questions at any point in time, and we will address them later. A copy of this webcast will be published on our website shortly after the presentation ends. I now have the pleasure of handing over to our Chief Executive Officer, Mr. Sverre Flatby. Sverre, the stage is yours.
Thank you very much, Einar, and welcome everyone. It's a pleasure for me to go through some highlights from our Q2 this year. It's an exciting quarter, also defining a lot of activities that are related to our future value creation. We're going to go through two important aspects, actually. One thing is what's going on in the market and on the customer side, which is a very strong situation for our company. Secondly, what are we doing internally to meet these challenges in the market and also the ability to reach our NOK 1 billion goal, which we all know. Let's start just to summarize some of our normal important statements when it comes to our strategy.
First of all, we stick to this, strategy when it comes to specialized software within healthcare. That has brought us to a very strong position, in the Nordics, but also growing outside. When it comes to our future acquisitions, we will stick to this and, be very, true when it comes to focusing on specialized healthcare and components that are having decades of recurring revenue streams. We stick to that strategy. That is important to understand when you look at the rest of our activities this quarter and the quarters to come. Again, why are people working at CSAM? I think it's fair to say that most of our components within the healthcare or Public Safety area is actually, doing something important for patients.
In most of the special situations in life, whether this couple is having someone in the family with cancer, or there has been an accident calling nine one one, or maybe they want a child, in any and these types of situations, the healthcare professionals helping you would normally use some kind of CSAM component when they're working. These components are glued into different types of application architectures in different hospitals all over the Nordics and also in the rest of Europe. This gives us an important role in society, and this is also the real reason why we have these recurring revenue streams over decades. They are important components glued into processes inside hospitals and Public Safety organizations. Then we have come to a situation now which is extremely strong.
Exiting the Q2, it's not only that we have these 500 healthcare institutions or entities as customers in the Nordics and also growing in Europe, but also there are actually 750, around 750 unique contracts. What are these contracts doing? I will advise all of you to actually read, we published yesterday a study when it comes to how our relation is with one of our customers, one of those 750 contracts. It's about Public Safety. It's about Valencia in Spain. I think if you read that, you will understand a lot about our strategy and why we are running the business the way we do. I will advise you to do that. I said we're going to focus on two things.
One thing is the market and the customer, what's going on there, and secondly, what we are doing internally to approach it. Let's go through the market as it is and our customer situation today. As you know, we have these seven areas, and the generic thing with all of them is that we all have customers over time, over decades, that are using these components, and they have a role which is very important in their business. That is a very good start, and that gives us predictability and the ability to see over time, what the customer needs are.
What we see in all of these areas now is that there's an increasing need for add-on modules to help them enhance their processes, technology shifts to make them more efficient, and also new customers that need new components that would help them be more efficient or increase the quality of healthcare processes. So that's the generic thing, and it's a good thing because the trend is there. It's increasing, and we see that the customer's needs are now increasing every quarter, including the Q2. To go through all of them just briefly, if you start on the top left, Medication Management. What is Medication Management?
Well, this is from CSAM delivered a component sets that are actually the default standard in many hospitals in the Nordics to handle oncology treatments with medication. It supports the doctors, the oncologists that actually design cures, the right cures for the patient, but it also helps the pharmacy when it comes to producing the right cure, and then back to the hospital with the nurses that are actually administering the cure. In the end, also the patient that are collaborating with the people on the hospital side to create a value chain. What has going on there is that the need for technology shifts, specifically going from thick client application to web client application is necessary for the customers to have more deliveries quicker.
That is part of what we've been doing in the Q2, is to deliver a web client on top of there to be able to deliver more components. New components are ordered like ID cards to make it simple or easier, quicker to access important information within cancer treatment. Similarly, with the Women and Children's Health, same there, although it's a completely different medical discipline, we have components that supports different user groups. We have in Finland and in Norway installed new versions in production with added functionality and also new aspects of GDPR, et cetera, necessary add-on components for customers that are important. Also preparing for bigger tenders coming up.
Tenders are not coming up often, but when they do, we are there ready, of course, to secure that we can grow also with new customers over time. This is an exciting area with growth or recurring revenue over time, and also now with new customers. Medical imaging. What is medical imaging in CSAM context? Well, it is specialized components, and it's also inherited from different acquisitions over time. What has happened there in the Q2? Well, over time, we have had two product lines supporting different customers in different countries. Now we've converted that to one platform, making sure that it's easier to distribute, and it's obviously more profitable to run this as one platform rather than two. This is one thing.
Secondly, we've added mobility on top, and we see now that the bigger regions are increasing the number of users and entities using mobile versions of these imaging components. The same here, also a growing attention from the customer side to do more. Connected Healthcare, which is a more of a complex technology stack rather than a very specific functionality for healthcare personnel. There's a lot of things going on there as well, including development of storage mechanisms that are relevant to all our customers, but also within the other business areas we have. This area, it's actually easier to measure the need for digital solutions within healthcare. We have one component called HelseMail, which is used to distribute images, et cetera, between healthcare institutions.
When you do that, you can actually measure the growth of that type of transactions. We have another record in the Q2. It's growing, it has been doing that for the last quarters and also in the Q2. In a way, showing us that the increased attention from the customers are in all of our areas. We have Health Analytics, an exciting area. It's a generic growth area for healthcare at large anyway, because researchers, managers all have to use the data of healthcare to make the right decisions, whether it's business decisions or it is analytics related to research, et cetera. There we have, as you know, an acquisition from 2021, MedSciNet and the one in 2022, Carmona.
Of course, a lot of work there is going to collaborate together and to talk to the customers, making sure that we can also there create a platform with one platform rather than two platforms. The approach to that is also welcomed by the customers. You have Public Safety. I mentioned the Public Safety customer study. You should read that. Public Safety is our biggest area at the moment, and there's a lot of good things going on there as well, showing exactly the same growth when it comes to the customer's needs. We have, for instance, in Greece and now renewed contracts for a national solution till 2026, and also we renewed in Croatia.
There are things going on that show us not only the growth on the customer side, but also the robustness of our SaaS and the stickiness of our recurring revenue streams. There's also good technology investments there that are good for the future. For instance, we have our first cloud installation in production within emergency and acute. It's not going fast in the specialized healthcare market when it comes to cloud, but actually now we are entering that, especially for the smaller entities, that they easily can use these software types without having to have on-premise complex architectures. That is a very good thing in production in the Q2. It's a very good thing for our Public Safety sector as well.
We have the Blood Management area. We have talked much about it because it is a huge scale-up situation, which we will talk about. The reason for that is also based on the market and the strong situation in the market. We have a huge order backlog there coming up, in addition to the fact that we have this national project in Denmark and also other countries wanting to do the same because it will be a much more efficient model to share these, systems and collaborate, over regions and hospitals and other entities.
In the summary of all this, also, you can see the Blood Management with the pipeline also are developing a new type of software, also more scalable, with web clients, et cetera, to make it easier for those customers that are lining up to actually be able to install them quicker because these installations are highly complex. Many of those takes more than a year to implement, and the reason is not because it's technology itself. It's supporting processes in many areas of healthcare and involving the patients, storage of material like blood and tissue, and also the distribution to clinics and the quality management, accreditation, et cetera. It's highly complex and important.
As you can see, what I think, exiting this Q2, 2022, is that from the outside and into CSAM, it's a trend that are very, very positive. We see that in all areas, and the summary of that makes us quite sure that we have chosen the right strategy, and we are focusing then obviously on how to get to a NOK 1 billion target in 2025 and which way to do that organically and through M&A. That's what we do. Now when we went through the outside of this, let me go through the highlights of the numbers before we talk about what we are doing on the inside of the company. First of all, a NOK 90 million quarter, NOK 10 million more than same quarter last year, a bit lower than the previous quarter this year.
On the other hand, a bit lower in number of licenses. But then again, that is not really uncommon because these are lumpy. They are based on deliveries to customers, so they will change from quarter to quarter and year to year anyway. The good thing, and most important thing when it comes to our income, is obviously this. The growth of recurring revenues is the stable, predictable platform for CSAM, growing 14%, compared to the Q2 in 2021. Obviously, as you see on the left and right-hand side here, these are customers that are there for many years and decades.
That will, as you probably know, show that from exiting this Q2, and if you multiply these NOK 70 million by four, you will see that, look at CSAM when we listed in 2020, the growth of recurring revenue is huge and important in our value creation plan. I think this is parameters that matters to us when it comes to planning further growth and actions we are coming into also now that happened in the Q2. Organic growth, again, also, lumpy quarter to quarter, but then again, it's normally between 5% and 10% as it is this time, a bit more the Q1 this year than the Q2. Then again, on average, maybe 7%-8%.
We have said all the time it's going to be between 5% and 10%, and we stick to that plan in our value creation plan till 2025 with our NOK 1 billion goal. We're happy with that. The gross margin shows the quality of our action internally, also in the Q2. We are cleaning up. We don't want third-party components. We want to replace third-party components with our own components. That's, you know, what's happening over time. I think over time, we will see ability also to get even better gross margins. Part of that game is obviously divestment as we did early this year, but also the specific task to use our own components that we own rather than third-party components.
The EBITDA, and we will talk a bit about the EBITDA, NOK 3.2 million. It's a positive EBITDA. Is it high? Is it low? 4%. Many of you would expect a higher EBITDA. We have a reason for it that I think is a deliberate action on how to approach and grow the business further. We think it's good. That means we have financed a changeover and the processes that we need to do within our operational business and still keep on with a positive margin. In our heads, it's a very good one, and we will of course use much of the time here today to explain the EBITDA also.
More importantly, our long-term approach to grow to NOK 1 billion is obviously the focus on staying as the leading provider in this game in with our current customers in the Nordics, but also obviously grow outside. I think going from 7% the same quarter last year to 12% is showing also that trend. It's not only important for the growth and the NOK 1 billion goal, but obviously also for the fact that we diversify our portfolio over time and which also creates possibilities when it comes to cross-selling over time. It's a very good position to have. I think that is the major points when it comes to numbers for the quarter.
Let's use some time to explain to you what are we doing with our internal profitability approach, EBITDA margin approach. I think it's fair to say we have spoken about buy, integrate, and build in all the company history because we are a acquisition company, and the ability to grow to NOK 1 billion and the ability to reach a 30% EBITDA margin after two years of acquisition is based on the model. However, we have used that model for many years, and the version 2.0 implemented in the Q2 is a different game because we have to implement organizational changes to scale the buy, integrate, and build.
That is a very exciting happening in the Q2, which in my head is one of the most important deliveries of the Q2 actually for CSAM and for our growth journey. What is going on now specifically? I've also shown you before the simplicity of how to focus on the 30% margin goal. We have these all these projects that comes up based on acquisitions we have made. Those have obviously different positions in the portfolio when it comes to their ability to grow the EBITDA margin. As you see now, we are in the Q2 reporting that from in 2022, you'll see that there's a very busy thing ahead of us that will create these margins.
It's not only on the cost side, it's on the income side, dialogue with customers. They have a lot of needs. They want to buy more, but it takes time. We do that in a patient manner, and we focus on processes to secure that we over time, do exactly what we do with the buy, integrate, and build. Today, we're going to explain to you, how we do that from the Q2 and onwards. It's different than we have done before, actually. Just to have one example with the Carmona in the bottom here, that is obviously one going on exactly now, acquired just recently. During the Q2, the integration project started, full time. And also the good thing is that they work together already as one team, with one manager.
That is really how we're going to measure this. We're going to explain that thoroughly for you later. Let's go through what we do and what we did during the Q2. Of course, we use this customer, core, competence, our three C principles, when we acquire things, and that is what creates our value chain to get to 30% margin. Of course, based on that two-year plan, we get this operational efficiency. I'm sure many of you would have this question on top right of this slide. Why isn't the EBITDA margin growing steadily in the Q2 compared to previous quarter when we continuously apply our buy, integrate, and build processes? I would like to say to you, it does actually.
We are following the results of that, and that will increase the margin as we plan. However, when we talk about the two things, one thing is what's going on with the customers and the market, which is a very strong trend. What do we have to do, which is important for our value creation? We had to do during the Q2 a scale-up, and that means hire a lot of people, not only full-time employees, but also consulting consultants to secure a better approach to the pipeline of customers. These costs will come, and the income will come, but not at the same time. This is the right management decision to make, and it will obviously affect the short-term elements of the company, like the Q2 EBITDA.
We also have a most important thing actually. In the Q2, we learned from the best. We had to reorganize the company to secure a more scalable version of our buy, integrate, and build model, making sure that we move the organization closer to the customer and also make it easier for us to measure the performance. I'll go through that in more detail in a few seconds. We have increased, as you've probably seen, a top management and management side of the company, and we've done that deliberately to make sure that we can deliver the primary task you have given us. We want to grow to NOK 1 billion in 2025, and that's what we're doing.
We had to make a step up. With more resources on the management side, we can scale better, and we can do the whole journey. That's, I think, one of the most important thing we have done based on this, decision-making process in the Q2. We also implemented during the quarter. This is probably, in my head, the main and most important delivery in the Q1, which I'm very proud of that we are able to do. What we now have is very clear responsibilities. We have put the decision-making closer to the market and our customers. We have specific persons, very experienced people doing exactly that. This also means we have distributed the organic growth and P&L responsibilities.
That is, you know, if you ask me, you want to measure our acquisitions and our BIB. If you wanna do that, there are some simple KPIs we can look at over the next years when we grow. That would be the sales divided with the number of employees. That responsibility is obviously the move to each business area to do that in a proper manner. That is a tool that is used by some of the best, for example, Constellation Software, which is one successful acquisition software company. We think to do exactly the same in this part of the company growth when we came from a NOK 200 million run rate when we were listed at closing to NOK 400 million this year, and then obviously go to NOK 1 billion.
I think we have done the right thing with management now to do that scale and also the structure to make sure that this is run in a proper manner. Also, on the third point here, the decentralized responsibility for the BIB, what does that mean? That is highly important because when we now do the same methodology, the task list to integrate lower cost, higher income, then you have also a process responsibility there that is moved from a central project portfolio system to a very local thing.
What happens then with scalability, that means we can do more acquisitions at the same time and then obviously scale better to do what we're really here for, to get to the NOK 1 billion goal and do that in a proper manner when it comes to margin expansion at the same time.
We are very positive, very happy with what happened in the Q2 when it comes to this organizational change. We have used a lot of time to do that, and I'm proud to tell you that it has happened. Just to give you a bit more, I would say, specifics on this. We have three elements recently. One thing is the reorganization, as you see here, that we have decentralized, and then also that we have increased the management. That is one thing recently. Going forward, that is because we want to go to that billion. It's not because to do something good for the Q2 isolated. This is very important.
That means also more capacity and ability, scalability, within M&A, and also obviously the ability to scale better and to save cost over time, in addition. That is one thing with the reorganization. Then the other thing, which is far more important and is related to the fact that the customers want more and that the pipeline is growing. That is the delivery capacity. Actually, 20 FTEs have been hired over the first and Q2 and hitting us obviously in the Q2. It might look negative. It's not in my head quite. On the contrary, I think that we have been able to still go with a small profit after doing this.
As you all know, you hire those, they have to be trained, you have to have projects that we deliver, and we get the income and milestones in that project. It's not in sync, the income and the cost. Actually, we are quite proud of that as well. This will increase our ability over time to strengthen our organic growth because there are more to come, and it's a strong need with the customers. These teams are very good when it comes to also the future performance, not only to do the queue that are there today. There are some one-offs we don't adjust. We just think it's relevant to say that when we do things fast like this, there are recruitment costs, there are temporary consulting that we need.
That is obviously something that over time, going forward, will be lower or diminish over time. I think it's important to see our Q2 EBITDA in this context because it's a deliberate thing. It's not something that happened and we didn't know it. Hopefully, most of you, especially our long-hold investors, will agree that this is a value creation decision and a delivery in the Q2 that is important. I would like to also say to you that we have used this slide since we previously were listed and the month before and all the time after. I think what we have shown you in the Q2 is in a way, in this perspective, very simple.
My summary from the green and the blue here was that it's a strong thing in the market at the moment, and it's growing and also, you know, Q2 we see it with our customer relation. That creates this long-term revenue, the gray one. You saw that with NOK 70 million this quarter multiplied by four, you see that the strong fundamental thing with CSAM is even stronger. On top of that, I've always said 5%-10% growth organically, and that's what's happened this quarter and the Q2 and year to date, about 8%. It's going to be like that ahead as well. That's how we see it. What is the real important thing today? Obviously, the NOK 1 billion goal is not reached without getting more targets included into CSAM's current operations.
We are having a lot of dialogues. We have a new M&A platform. We have converted our database to a new M&A platform to secure a more structured approach to our M&A pipeline. We moved about 250 projects into that platform to follow that specifically. It has a lot of the sales of those companies are billions, and there are many interesting small ones, big ones, and we are going to focus specifically on that, those contacts, and we are going to do exactly what we said all the time. We want to go to NOK 1 billion in 2025, and that's what we're working on. Having said that, we also have to take into consideration it takes two to tango.
We need to take the right one at the right time and also the right price. With all these dialogues, we are sure we are going to hit the right targets at the right time as well, although we haven't done specific acquisitions in the Q2. I think that is an important thing to say that we have, as I see it now, a better control, a better model for our operational part to reach this, and we also have a stronger structured pipeline for the M&A engine as well. We are prepared for the next leg. I think also we have ambitions to repeat that. We are a very small Norwegian company. We were able to be the leading one in the Nordics.
We think that showing going from 7%, Q2 last year to 12%, outside the Nordics, we are on our way to be a notable player in Europe. You can see that if you read our Public Safety study, how this is working with the customers, big customers. Valencia is, for example, as big as Norway as a customer. There are many important ones, and you should look at that to see what the real plan here is to grow in the Nordics and outside. We stick to that ambition. As I mentioned, we think we show you through the numbers that this is what's going on as well. In summary, customers are really now focusing on further deliveries. The pipeline is increasing.
I think we have created a model during this quarter that really makes us strong, and we will do it the right way, not only the operational part, but also the acquisition part. I'm quite happy with the Q2, and I hope you all are as well. I think we should go through now the financials, obviously, more numbers. Einar, you have prepared some numbers to explain, I guess.
I have indeed. All right. Let's have a look at the numbers. First, the most precious part of CSAM's income, as always, the recurring revenues. They are increasing steadily. They have increased by 35%, compared to the Q2 of 2021. A strong performance by any standard. Based on the last four quarters, the run rate is NOK 272 million, and based on the run rate is closer to NOK 280 million. Remember, when we went public in 2020, we had sales of NOK 229 million. Already the recurring revenue for, based on the Q2 of this year already far beyond the total sales in 2020.
Remember the counterparties, public hospitals in the Nordics and elsewhere, and negligible churn, as before. A very strong foundation, a very good news for our bondholders, but also a perfect foundation for continued M&A. The revenue growth in the Q2 2022 compared to the Q2 of 2021, 13% total revenue, and a healthy growth in recurring revenue from NOK 61 million to NOK 70 million, and also a healthy growth in professional services from NOK 14 million to NOK 17 million. That takes us to almost NOK 90 million in sales in the Q2 alone.
The recurring revenue increasing 14%, now comprising 78%, almost 80%, very close to our long-term ambition of 80% recurring revenue. That is a very healthy development indeed. The cost base, the COGS is very much under control, and you see that the gross margin is above 90%. Also, if you take a look at the run rate for the COGS and you just do a simple back-of-the-envelope calculation, year-to-date times two, you see that the run rate is below full year for last year even though sales are higher. Also, if you look at the other costs, same calculation, same trend there.
Although you see that it has increased somewhat compared to last year, we're traveling again and we are participating in exhibitions like Vitalis. Then you see an increase in FTEs. Again, consequence of recruitment activities necessary to handle the delivery pipeline. This delivery pipeline is what is driving license sales and recurring revenue in the next phase. Of all the problems you can have in this world, having an increased order backlog is very much manageable, although it comes as a. It penalizes the EBITDA in the very short term. Speaking of the EBITDA, the reported EBITDA is down compared to last year, from 13%-4% of total sales.
CapEx is back on the level that we guided on, approximately 10% of total sales, and we think they're going to remain there. Keep in mind that the EBITDA, the main effect is personnel expenses. Remember, 20 FTEs are hired to handle the order backlog. As Sverre mentioned, top management is now in place to handle the organization to have the capacity to allow us to grow to the NOK 1 billion. We'll have a look at the net working capital. We have guided you that that should be -10% or better. It's now -19%.
Little jump up from the Q1, -21% to -19%, but more positive development than same period last year. This is indeed an effect of managing cash in the same way in the acquired entities as we have in CSAM for a very long time. We are well within our targets. We have very loyal investor base. This is, these are the external investors, excluding Sverre, myself, and the other founding fathers, so to speak. We see they're divided between Swedish investors, Norwegian investors, and increasingly, Anglo-American investors. They're also providing a lot of good advice and have a huge interest in the company, something that we appreciate very much.
All right. All in all, same story. Heard it before. We are going to continue in this market with the structural growth of between 5% and 10%. You see that we are continuing to grow there. We will continue to focus on specialized healthcare and software for specialized healthcare. We will continue relentlessly to focus on businesses with recurring revenue. We will grow as fast as we can organically, 5%-10%. We proved that in the Q1 and the Q2. Then we'll continue to grow through M&As, and we will focus on reaching NOK 1 billion in sales within 2025.
Before we move into Q&A, for those of you who like to follow CSAM, sign in to our newsletter and subscribe, and you will be the first to get all the juicy news. All right. That ends the presentation. Now let's move on to Q&A. We have a couple of questions here. I have the first question for you, Sverre. That is, "Are we being too picky, too selective with acquisitions to make sure they are the very best strategic fits? What are some of the challenges convincing existing owners of M&A targets to sell?" So what can you say about that? Are we too picky? How do we convince them?
It's maybe whether we are too picky. We are picky, I agree. I don't think we are too picky. I think the reason is, I think for both our bondholders and I think also for most of our shareholders, that the stability and predictability and recurring revenue streams are extremely important. There are a couple of characteristics that we want, you know, we won't do anything else. I think that should be there anyway. We have looked at many companies. We see there's not an income quality that we like. In that sense, we are picky. When it comes to strategic fit, yes, maybe we are too picky. On the other hand, why is our recurring revenue so strong and almost without churn?
Q2 it was almost nothing. Again, I think the strength of that is based on the fact that we have focused on highly specialized components. You might say that we could grow much faster. We could acquire something that are relevant, good business, but maybe not exactly what we want. The answer could be yes or no, well, depending on what you want. What I think I should do, based on where we stand, is that we want to go to NOK 1 billion, pick those targets that are relevant to go to the volume, but then again, we also want the right ones at the right time, but also at the right price. Yes, we are picky, but not too picky.
That's my conclusion, to put it that way. You said how do we talk to the owners about this. What I think CSAM has done over the last year is to position ourselves as a very good buyer. We are a good home for that type of solutions, and I think that is really our brand name, and I think that will be also a very good thing for us in the next when we climb to the NOK 1 billion goal the next couple of years. In that sense, I think our approach to this, our dialogue over many years with the targets has gotten us to where we are now, and I think that will get us to the NOK 1 billion. Is that a good enough answer for you, Dr. Bonnevie?
It's good enough for me, and maybe also for Bobby Mackey. I don't know. All right. Another question about the organization and which you spent some time on, Sverre. Do you now have the organization in place for your NOK 1 billion targets? Should we from here expect scalability on admin functions or top management?
Uh-
What can you say about that?
The simple answer is definitely yes, and that was the whole point, actually, when we decided to do these two things. That, I mean, is critical to get to the NOK 1 billion, is to secure that we have the management in place, like for instance, HR, we hadn't before, marketing and communication director, et cetera. We had to do this now to do the growth. Yes, we don't expect to change that part in our journey to the NOK 1 billion. Also, I think this organizational model is actually also the same. It will scale and give us the possibility to acquire enough companies and also to integrate enough companies in the period till we reach the NOK 1 billion.
All right. A question about from our friend Oliver, and that is about license sales. Why do we not see any new license sales in the quarter, given the strong backlog you have cited? When do you expect organic growth to pick up to motivate the higher cost base?
Well, to use an example, we have many areas with a pipeline. If you look at specifically the LIMS area or the Blood Management structure, you can see that let's say we have 20 customers that needs an upgrade with add-on modules to get a better quality of their processes. To deliver that, it's not really a quarterly game. It has to do with, let's say, in the Q1, part of that license is one delivery in the Danish project. Maybe there's some next quarter, maybe not, maybe it's even in three quarters after. That happens during milestones in large projects.
If one delivery takes 18 months or 12-18 months, then you have 20 of those, you have to run some of them in parallel, and some will kick in one quarter and some will kick in other quarters. I've said before, and I think that will happen in the quarters to come, that these lumpy and jump from one to another. The simple thing, I guess you're thinking about, Oliver, would be if we had had a couple of such milestones in the Q2, then you'd had suddenly NOK 7 million in licenses, and then it would be more like the Q1. It's obviously that these that part of our business is lumpy.
The average has been between 5% and 10% when you look at it over time, back in time, many years, actually. I think it would be the same, but what I also think, I think it will be stronger and stronger on top of that interval, as we go ahead because, the needs now, as I mentioned during the Q2, it seems stronger. Also it's a bit after COVID situation as well that, customers are ramping up, getting back in their office. We're actually happy with, that part, although this quarter have a lower license, income.
All right, I'd just like to add one thing, and that is that we have said that organic growth is between 5 and 10%. It was about 10% in the Q1. It was about 5% in the Q2. That is again measured in local currencies. We describe how we do that in the quarterly report. In Norwegian krone, it's around 2%, and that is because Norwegian krone strengthened against almost all our trading currencies in the Q2. The organic sales and organic growth that you see in the numbers at first glance, it seems lower than the underlying growth actually is. Just keep that in mind. It was one on financing of acquisitions.
How do you plan to finance new acquisitions? Well, there are many ways to do that. I'll address that one. Sorry.
I think so.
That is, first, if you look at the balance sheet, we have NOK 260 million on the balance sheet, so we have cash in the bank. That is one way. Another way will be to, I mean, you can have seller credit vendor notes, you have earn-outs. You have other ways of financing the acquisition. I'd say for the short to medium term and for acquisition targets around the same as we have acquired in the recent past, we have the ability, we have the capacity. Then there's one again on acquisitions, and I think I'll address that one as well, and that goes on multiples, and that's from Andrew.
Thanks for the details of the structural changes. Regarding acquisitions, what multiple is too high to pay for an acquisition? Well, I guess there are no exact answer to that one, but historically, CSAM were paid between 1x and 2x sales and EV/Sales, and we focus, as you know, on EV/Sales and sales multiples because not all of the acquisitions have had an EBITDA. They have been either loss-making or around zero. Turn around or turn better. I mean, there could be exceptions where you find a company that would justify a higher multiple, but let me just say that we have been prudent in the past and I think we will continue to be. Okay.
Another one from Andrew. Maybe this is best talked about if we meet in a pub, Andrew. I don't know where you are. Can you talk about the worst deal you have made in the business history?
Yes. Of course, I hired a Chief Financial Officer once. That was probably that one. It's
I-
I think it's a better story that we have had five or six acquisitions that we have looked at and jumped off a couple of them very fast to see this, you know, unstructured. It's not, you know, a good thing. We have jumped longer into the process with a couple of them and then see that, for instance, things that they don't own their own IP properly or there are third-party things inside and stuff like that. I think we have avoided actually what could be a problem for us, for such things are that things that would actually destroy the good thing with our model, is that we stick to our own IP, and that's why we can have this gross margin 90% plus.
So far, if you look at the M&A history we have, those we actually have entered into and integrated, we don't regret any of those. I stick to the initial. It has to be the Chief Financial Officer.
All right. Another one on margins here. This is one from Oliver, and there are a couple other questions on margins as well, and this is about our long-term guidance of 30% EBITDA margin. Oliver asks, "Do you reiterate the 30% EBITDA margin target within 24 months for new acquisitions, or is this abandoned now that you tweaked the strategy? What is the new ambition if it's not reiterated?" What can you say, Sverre? Have we given up on the targets or can you confirm it?
Not at all. I think you will see what we did when we had this huge portfolio of integration projects centrally is quite complex to measure, and I got a lot of questions from many of our long-term shareholders about how can we measure this better? What can we publish? What can we do? I think this is not a change that is changing the ambition or the ability to have a 30% margin. I think on the contrary, it's much easier. I think if you looked at that seven split business area approach, the simple KPI would be the turnover, which is, or the sales then, with the growth of 5%-10%, and then the ability to count the heads.
It's actually not more complicated than that because the other aspects of buy, integrate, and build is a task list that is structured and is exactly the same as we've done the last five years. It's just distributed, and we feel that this is actually easier, not only to measure but also to achieve 30%. It's clearer and responsibility is clearer. We are quite happy with that model actually.
Okay. I think we'll have a few other questions on EBITDA margin. Let's take those before we round it off. That is, how will you increase overall EBITDA margins when new companies are constantly acquired and those new companies have lower margins? How will we do that?
Yes. Obviously, generically, when you have a company with let's say the current business, we've showed you the project portfolio. We see that after two years when everybody has passed milestone M3, then the current operations should perform 30% EBITDA margin. Of course, if we acquire something that has 0% margin, obviously that will be diluting those 30%. On the other hand, over time, it also depends on the size of the targets we acquire. I see now that we have a lot of both smaller and bigger targets that we discuss with.
I think when we grow, I think that effect will be not so high as it had been, when we went from NOK 200 million to NOK 350-NOK 400 this year. I think over time, I think this is easier to measure, as mentioned. I think we will have to show you exactly that. This is the current operation, this is the acquired. When you fully integrate, you will measure one business area. For instance, we acquired MedSciNet in 2021, Carmona in 2022, and then put them together, and we measure only the combination. Then you will see they should have to go to 30% from one point to another.
I think that should be the model for all acquisitions going forward.
Okay. Two questions left. I will continue with one more related to EBITDA, and that is: What should ongoing normalized EBITDA margins be, even when you reach 1 billion NOK in revenue, especially given that acquisitions and integrations will be a constant feature? Okay. I think the ongoing normalized EBITDA. I think we will gradually reach the 30%. Also remember that the bigger we are, the less dilutive a new acquisition will be. That is one thing. Another thing is that as the current businesses mature, the 30% margin that we have been discussing is not like an upper limit, like it's impossible to go beyond that. It is. We can do things on just.
I mean, you have this economies of scale. You will see them on other costs. We will trim and put it on personnel. On COGS, the bigger we get, the more we can in-source of those services that are outsourced, like third-party software, et cetera. We'll also continue to focus strategically on the core business. Close to 30%, I guess, is the short answer. There's one question left. This was actually one of the first questions that came in, so the first shall be the last. That is about entrepreneurial spirit and reorganization, and it came before you presented the new organization, Sverre.
I think a year ago, you may not have applauded this question, but right now, I think you will very much appreciate it. It's. How does CSAM as an organization retain an entrepreneurial ethos and avoid the insidious effect of bureaucratic paralysis, given a centralized model of the integration post-acquisition? Do you actively ensure business units are kept small? What was spot on, was it? You tell.
Yes, it was definitely spot on, and thank you for the question. I think that's. In my head, it's actually the best question for the Q2, and we have the best answer because I think this change is vital because I've been within eHealth, healthcare for four years, and I see that all the time these complex small entities need to be close to the customer to succeed. I think the only way actually is what we now did because the matrix, the approach to do that with the products, service, et cetera, and that the traditional organizational model is not scaling, and that's one thing.
The other thing is that you raise that problem you're actually indicating about, culture and the ability to be lean and entrepreneurial. I think the very good people we have in this, these niches we have, these business areas, they have their culture, and CSAM has one culture, and we are working hard now from the top management side to be a good service and help to these business areas. I feel that we are answering that question through the structure itself, but also as a management team, that we want this to be what it is, a very strong portfolio of good teams that really can deliver in the future.
All right. Time is running out, but that was also the last question. I think it's time to round it off. We hope you have enjoyed this presentation. Tune in again on November 30th, when we will present our results for the Q3. Until then, tell your loved ones that you love them, take care, and stay safe.