Good morning, everybody. Welcome to CSAM's presentation of the financial report for the Q1 of 2021. I am Sverdrup Flappi, the CEO of CSAM, and I am taking the liberty of Waking up our CFO as well. Einar, welcome.
Yes. Thank you, Sarah. My name is Isain Bonnvi, CFO of Isam. We are Happy to present the Q1 numbers for you. But first, For those of you who like to follow CSM and follow what we the news, There is no page on the press release form on the press release page where you can subscribe to our news.
Quite easily, fill in your name and e mail address, the news type you like, and it's fully GDPR compliant, and you will The up to date on all the news on CSAT.
Great. So let's move on to our highlights for the Q1 this year. And I'm happy to tell you that this quarter, We have a revenue growth of 40%. I think everybody remembers that have followed us before that our growth Targets is just between 35% 40% to reach €1,000,000,000 in 2025. So we're quite proud of the fact that we can start with that pace.
This is our first clean quarter. We had our IPO in the Q4 last year. So Of course, with some focus there, this is our Q1 with a real business, as you see. And not only that, the most precious part Of our business is, of course, the recurring revenue streams from these specialized entities in the health care sector. And 25% growth in recurring revenue is, of course, also showing that the stable, The underlying business here with low churn is still there and growing.
So that's very good. In addition, Another highlight is, of course, the EBITDA, which is showing that we are growing Also there, 18% Q1 last year and 19% this year. And of course, it also gives us the information that our operations are running with positive cash flow, and that is also important while growing. So I think those three elements here would give you some kind of taste of how good we are performing at the moment. And then of course, Roll up story, what is CISM about?
It's, of course, an acquisition story, and we are continuing that And the Q1 milestone, the acquisition of Carmenta Public Safety, is quite important. I will go through the details of that acquisition. But of course, the summary of that, in addition to the 3 highlights mentioned, Of course, it should give you the comfort that we are on the pace we need to be to reach our targets. So not only the Q1, but just after, we've had a couple of other highlights here. And of course, A €200,000,000 bond tap issue just after the Q1 is an important aspect of our growth story as well.
That gives us the additional capital in addition to what we have from the IPO, of course, to continue The acquisition targets work with those in the months to come. And of course, We are still just in the middle of the second quarter and to get more cash to do acquisitions. The rest of the year, of course, is important as well. And then again, to grow, we need competence on all levels of this organization. And we are very happy to welcome Gunnar Bjerkaborg, Borg, who has been a former Chair of VISMA, also entering our Board to help us design the future and to accelerate our M and A capabilities.
So that's all good news. And To just remind you all what this is all about, what is CSAM, where are we for, I think it's important to understand the difference between CSAM as an eHealth company and many others. We have chosen a very specific strategy, quite a unique one. And the three first words here, ehealthnichesandsoftware defines us. And I think we are the only one Stating this and focusing only on that, and that has made it possible for us to become the leading provider in the Nordics, but also with, of course, a potential in Europe and the rest of the world.
So I think that is important to understand. And our software is related to highly specialized processes in health care that are there for many, many decades and they are rarely changed. That means that is the reason for the low churn in our business. This is highly specialized. So and what are we actually doing?
I think most of you, in your family, among friends, will reach milestones in life where things happened. And these things normally could be positive things like if you see this couple on the picture thinking about having a child or they're talking about the recent acute incident or somebody, a friend or a family has had cancer In any of those situations, you will probably see that health care personnel helping you as a patient, Some kind of small CSM component will be at work somewhere. Maybe even you won't notice, even the health care provider won't notice at the moment, But these small add on components to these workflow processes are what we're doing. And that makes it also very interesting for our people to work at CSAM because this is something useful. This is important for health care, important for patients.
So that's the general thing about CSAN. And then we'll be passing the Q1. Of course, Our systems, our components are in different niches. And just to briefly go through some of them here, so Medication Management and especially within oncology, we are still the de facto leading provider of specialized solution for people there. And there are 3 different user groups.
They have the oncologists that actually design cures Using our software to create cures and these algorithms make sure that you as a patient get the right cure. And then you have the user group on the picture here creating these cures, producing these cures. Of course, that is quite as important. Then again, the 3rd user group, the nurse in the hospitals that actually administers and giving you the right cures. This business It's still very important, although it's the smallest one of our niches, it has been growing fast all of the years since we acquired it in early in 2008.
So then again, it's important. It's long term over decades, and this is defining CSAM's niche strategy actually. And also, in our in the Q1, What happened within our women and children's health? Well, being the leading Nordic player is, of course, one thing and delivering to But also in Norway, Sweden and Finland, we also acquired something just before the Q4, meaning that during or before the Q1, meaning during our Q1 now, we have been integrating the acquisition of FirdSoft, which we acquired just before New Year's Eve. That is also important to understand with CSAN.
We are not just buying a company and let it grow on itself. It's being incubated. So that means our women's and children's health business has been strengthened through the Q1 and also the ability to grow, The ability to create better margin is already there. Quite important and also another one defining us And also with the high volume of projects in the Q1 is the blood management systems. These are used most of the most important providers in Norway, Sweden and Denmark are using this software and has been using it for decades.
So that means if you look at a quarter, nothing really happens in negative, positive way. It's just going on and on and on. And these customers have been using their competence to secure that these systems are getting more and more related to the quality management systems, accreditation and certification, etcetera. So these type of solutions is it has been Installed since 1969, and that says something about churn. Since these types of solutions are connected to different types of Clinical procedures, it rarely changes.
So and if you look at the user groups here, you have the patients that give blood or tissues To be used in hospitals, you have those who store secure the storage of these products. You have those who distribute them into the clinical environments in many,
many hospitals in the Nordics. So it's also quite a good
business for us, and also in the Nordics. So it's also quite a good business for us and a long term business as well. And also, of course, for the Q1, most importantly, Of course, the public safety area of CSAM is growing fast and is an important thing for society. And there, we had an acquisition, which, of course, I will go into and describe further. But we have been much, much stronger through the Q1 here, not only in the Nordics, but also in Europe.
So I'll go through that specifically since this is a huge thing for us in the Q1 of 2021. And then we have medical imaging, also same type of long term recurring revenue streams from components used in different types of smaller processes inside hospitals. These are not like big x rays or stuff like the bigger companies are using As more general deliveries of software, these are highly specialized. And normally then being highly specialized, They will stay there and be integrated with the different application architectures in hospitals around in the Nordics. And talking about integration, a growing area for CSAM is definitely our last niche, which is the connected health care area.
This business area is growing for one reason. All of these niches that we have that have this important role in health care, They need to be integrated to fully exchange information between different types of solutions, like the general EPR Solutions Journal Systems, if you like, like DIPs in Norway, Cambria in Sweden or EPIC in Copenhagen. So All of these systems need to integrate with these niches. And to do that, we have components to secure these types of integration. And we have a lot of different types of components here.
That's why it's growing. And since all these hospitals are different, They are using different components, different approaches to integration. We can deliver it all. It has been a fantastic journey for us since the company was actually founded based on Connected Healthcare in 2,005. So in 2,005, what really happened, why was Actually, CSAM able to become a success, I think being created by a national hospital, we were inside the complex clinical environment, understanding what really happened.
And the 1st 5 years, Ceesa was created as a company with a small export to Sweden, And we already, at that point in time, categorized all those complex small systems to put them together and then started our thinking about acquisitions. So we managed on our own to do this the 1st 5 years And then we managed to also grow that business over the years, and we were lucky to get onboard a private equity company, Privek. And with their fund in 2015, we were able to accelerate our M and A story. And that acceleration made it possible for us to become 5 years ago the leading niche player within eHealth in the Nordics. And of course, after the Q4 IPO, it's possible for us, obviously, to further accelerate the M and A processes.
And then, of course, you see the last acquisition, which happened in the Q1, and we are reporting now the Q1. I will give you some information on what that specific acquisition means to us. And of course, this is quite a big business if you compare it to CSAM, with SEK 230,000,000 turnover last And an acquisition of SEK 80,000,000 is, of course, a big one. However, it's a very important one, and it fits very well into our current business within the emergency and acute. And as you see, it was acquired at reasonable price.
And then, Of course, it gives us a new situation. And why is it so important? Well, this is really something that helps saving lives. And the operators around in Europe are using this software, the same as our current software, is, of course, very important. And then it fits well when it comes to our strategic position as the niche player.
And then again, It has important customers, many customers in many countries. However, it's also the spine of the national service in Sweden, the 100 and emergency service. And of course, that again strengthens us very much in the Nordics. But not only in the Nordics, of course, we now address a huge market with our software based in this segment. And of course, 45,000,000 Citizens Europe addressed through this acquisition because now a lot of operators in Europe are using that software specifically to save lives.
And then again, the combination strengthening the Nordics and increasing our export to Europe with a very risk manageable way because we have customers here, we have the same software distributed, and we have the ability to get further synergies with our current business within the emergency in the Q2. So in many ways, the most perfect acquisition ever. And of course, most of you, we have communicated our simple goal of having a €1,000,000,000 turnover in 2025. And of course, this transaction alone actually shows you how we are going to do this and how we are approaching to secure the plan going forward. So also, how do we get the margins?
I mentioned we have a positive cash flow from operations, and We have to do that in a structured manner. And you will probably understand, as we're doing new serial of acquisitions, that we have to have a multiple setup of projects that are doing integrations because CSAM wants to be one organization only. That means there are no separate companies doing separate work. So to do that, we have a model by integrate and build, and that is what creates the margins here. And what we do, if you look at the specifics here, Firdsoft, we acquired just before New Year's Eve.
They're in past The M1 already and are fully integrated, working inside our niche, women's and children's health. And now, of course, the acquisition of Carmana, which happened in February, Of course, so they are part of our Q1 numbers. But of course, the work with integration has more time to go there. We normally take 24 months before we restore the 30% margin that we want to have while we're growing. So this is how we do it, a structured manner, a portfolio of common parallel projects that we're doing.
That is what really creates the margin as we grow. And then, of course, what are we going to do? Where do we come from? What are we going to do? I'm quite sure you can see from our history where we came from, what we have been doing, going from an innovation company being leading in Norway and then in the Nordics And then now starting in Europe, of course, we have the ambition, in addition to being the leading Nordic player, since Few companies so far has chosen this very specific, highly specialized niche orientation.
We think We are able to be an important player in Europe this year, and we are going to go for being a leading Nordic player in 2025. And of course, the rest of the world is there. So we will have the ambition. And I think you will see from the proof of the pudding actually In the Q1 already, if you look at the 2020 full year numbers and the spread of our business, our customers and employees, You will see we had some distribution in Europe. However, if you look at the Q1, you will see 7% in Europe.
And also, if you look at the numbers here, now the diversified recurring revenue streams are fully represented in the Nordics better related to the citizens and the sizes of the countries. So we are quite Comfortable now that this quarter gives you really comfort that we are able to Reach this plan, which is not a secret to anybody. We have shown almost all stakeholders This slide all the time, a couple of years. And I think the Q1 simply showing you that the first step here in the Q1 gives us all the comfort that we will at least reach that target and maybe be even ahead. So Having said that, I think you're here for a reason.
I woke you up for a reason, Einar. So let's move on to the financials and give the audience a bit more specifics about the numbers.
Absolutely. Thank you very much, Sverre. Yeah, I'd like to take you through the financials. And after that, we'll have a Q and A session. The highlights first, We had revenues in the Q1 of more than NOK 76,000,000.
That represents quarter over year over year, quarter 'twenty one versus quarter 'twenty 20 of 40%. So we are extremely satisfied with that. The recurring revenue is growing as well, more than NOK 50 NOK 3,000,000, that's a growth of more than 25%. And the margin is growing as well, Both in numbers and in percent, from 18% to 19% in Q1 in spite of the acquisition activities going on. The in kroner, the EBITDA reached more than NOK 14,000,000 kroner in the quarter.
And it's also safe to say that the EBITDA is somewhat impacted by acquisition costs and M and A activities going on in the quarter. All right. These were the highlights. Let's move on to take a look at the recurring revenues, the most precious part of CSM's The income stream, and I'm happy and pleased to announce that the recurring revenue is growing and it keeps on growing. It has been from 2016.
And what you see here on the bar charts are the Last four quarters, the rolling last four quarters. And you see that on an annualized basis, we announced to NOK 184,000,000. And this is surely good news to the bondholders that are with us, supporting us and also a perfect foundation for the M and A story and the roll up story of Sysmas. Again, the counterparties here, public hospitals in the Nordics and an increasing part in Europe, Very low churn, inflation adjustment in almost all the contracts. So this just Keeps on ticking.
And as you can see, 1st class counterparties. Let's take a deeper look into Q1 and the revenue growth and the margins And CapEx, that is really what's it can be summed up that easily. Let's first take a look at the development in sales. You see again sales increasing from NOK 54,700,000 in 1st Quarter 2020 up to almost NOK 77,000,000 in the Q1 of 2021. We are firing on all cylinders.
All parts of revenues are growing. And again, reaching a total growth of 40%, which is very, I believe, in line with what we have communicated and what our ambitions are. And I think it's again, remember that we acquired CarMenta In the mid February, so it's only been accounted for 2 out of the 3 months in the quarter. And so the pro form a numbers, if you had included for the whole quarter, would have been sales of approximately 84,000,000 And that would have represented more than 50% growth in the quarter. So again, there's more to come.
Let's take a look at the EBITDA. Again, the EBITDA is growing from SEK 9 point 8,000,000 last year to more than 14,000,000 in this year. And that represents a growth of from 18% to 19% margin. And that again, in in spite of the cost associated with the M and A activities. And again, it is not Because we have put a lot of cost on the balance sheet.
On the contrary, capitalized R and D keeps coming Down this quarter, both in kroner, in NOKX and in percent as part of total sales from almost SEK 8,000,000 last year to SEK 6,900,000 this quarter. And in percent from 14% of sales down to 9% of sales. A little lower a little below what Our guiding we have guided you on CapEx on average of around 10%. We are not going to change that. But happy to say that this simply means that the cash from the operating activities, the cash flow from Operating activities is strong and stronger than it was last year.
So with this backdrop, I'd just like to take you back to our plans and our ambitions. We have a market with a good underlying growth. We will continue to focus On niche and specialized software, we are building on and focusing on the long term recurring revenues. We will grow as fast as it is possible to grow organically. It will be between 5% 10%, sometimes A little less, sometimes a little more like this quarter.
But all in all, we aim to grow to more than SEK 1,000,000,000 in 2025. That remains. And in order to grow from 2020 to 2025 to NOK 1,000,000,000 in sales, we need to grow at an annual pace of approximately 40%. Currently, we are a bit ahead of that plan. And We just keep on rocking.
So that was it. Let's move on to the questions. And again, you can submit questions in On IMU, and we'll just handle them 1 by 1. Okay. Any questions there?
Any questions? Yes, there are actually as a matter of fact, there are some questions. And it's one that from Eddy. And the question is, you have said Q3 is seasonally weak and Q4 especially strong. How do Q2 usually compare to Q1?
Any seasonality in Carmenta? Will you give The first chart on that was there, and I'll Yes. First of
all, with Carmenta, as with all our other niches, The seasonality when it comes to recurring revenue is not at all. So when you're talking about seasonality, it has to do with new projects or services or added smaller license deliveries, etcetera. So in a way, it's quite predictable. That's the most important thing. And when it comes to Q1, Q2, I think for this year, there were no big difference between Q1 and Q2 either as it hasn't been in the previous years.
But when it comes to the specific numbers and percentages, Einar, you could probably Answer that
better. Yes. The Q2 is a very ordinary Quarter, so it's neither especially weak nor especially strong. So I think Nothing special about Q2. It's normally a robust quarter, and we have no indications that this year will be any different.
And as we said, the Carmenta business is just tagging along. So nothing special on Carmenta. All right. Another question From Eddy, and it's probably for me this one, 9% CapEx in Q1, do you want to stay around that percentage of sale going forward or increase or decrease? We have previously guided you on a CapEx level of around 10%, and we maintained That's the guiding that's one of the few guidance we have done.
So 9%, maybe it's will be 11% next quarter, but Expect around 10%. It was a little less this quarter.
It is maybe important to remind People, what is really CapEx in the real life here when it comes to the hospitals? Well, it is business cases where we create components that the customers buy to add recurring revenue. They're adding value to their processes, and we're getting added recurring revenue. So We don't want it to be too low because it represents a growth potential for the future. So that is why it's there, just to it's not only Financials?
Not only financials. And here's one I believe is for you because It links back to the press release where you state, based on the development in Q1, we will reach over 1,000,000 NOK sales targets. And I think it continues faster than planned.
Yes. And it's not EUR 1,000,000,000 I hope it's EUR 1,000,000,000. But yes, of course. And if you saw Einar's detailed presentation, the bubble on the Q1 sales, You will see that if you pro form a add Kermenta business and you see we already have integrated the Firdsa business, You will see that we are actually growing more than 50%. So and it's In the middle of the Q2, we are not lazy people.
We are not going to stop here. So I feel that we are on our way, and I think we are ahead of the plan based on that fact. And of course, the market is there, and we are continuing doing what we're doing. So we're quite comfortable that that's the right way of putting it.
Okay. And here's a question that we get from time to time, split between organic growth, M and A and any FX The effects,
yes, it's like we normally tell people organic growth within the Remember the three words, ehealth, niches and software. As long as we stick to that strategy, these niches rarely changed. That means there's really no lot of tenders going on. It's really not an organic business. So where is the organic growth?
Well, It's normally between 5% 10% based on sales to current customers. That's most of it, almost all actually. So If you look at it that way, it will be between 5% 10%, and it is all the time. So we are not focusing too much on that actually as management. That is Part of the predictability, if you hire 50 salespeople, you will not get more than 510% anyway.
So That's because it's staying there forever in a way. So that is how we see it, and that's why we focus on what really matters for the value creation of CSAM is to get more of those recurring revenue streams through acquisitions. So in a way, if you want the answer, well, it's between 5% 10%, maybe this quarter a bit higher. But then again, we don't expect that to change. So we're not focusing.
That's my conclusion. We're not focusing on that because it's predictable as the rest.
That's right. And if if you want to do some calculations yourself, you know that there are 2 things have changed in the Q1 'twenty one compared to the Q1 'twenty, and that is the inclusion of FirdSoft, which we acquired At the very, very end of last year, which has been included for 3 months and Carmenta, which has been included for 2 months. And you know the approximate sales of both of those. Those are that's public information. So assume 1st of 3 months and incremental for 2, and that is the acquired part.
And you do the math. The FX effects, just to answer that one. The Overall, Norwegian kronor has strengthened versus all our trading currencies this quarter in the Q1. So that has the opposite effect of what we saw last year. But we are not reporting specifically on FX Last year was an exception to that rule as we had exceptional FX movements.
But as a general rule, we don't report on FX effects specifically. All right. Another one from Karl. And that links also to the organic growth versus the acquired growth, recurring software revenues in Q1, 25%. Again, it comes back to really the same question.
This is a variety of the same question as we just addressed. Nothing really special on recurring versus the total sales. That said, the income composition from the companies that we acquire, we are very often different from what they look like in season when they've been there for a very long time. And we are using time to Renegotiate contracts to improve the income composition, that is typically what we do during the buy, integrate and build phase Or M1, M2, M3, the 1st 24 months when we after we acquired the business, we tried to improve the income composition as well. And that is the effect that you're seeing in this quarter when you compare the growth in recurring revenue to the growth in total revenue, and that is the income composition.
So there's room for improvement there, and we will improve it. All right. The next one. And that I believe you can't be too specific on this one, Sverdrup, but there's a question about the M and A pipeline. Can you add some flavor To the M and A pipeline, is there anything going on?
Yes, the flavor will be it tastes good. But to put it this way, Our pipeline is really a database that we have created from the beginning of the company. The story in 2005, we categorized in the National Hospital all of those important smaller niches that has these same type of characteristics that are related to these specialized solutions. And based on that, we got also the overview of the Nordics and European players that actually has that type of software. So we have a huge database.
That's one thing. And secondly, we have been working with the pipeline specifically By talking to companies over years, so meaning that we feel that we are comfortable when we're talking about our 5 year plan based on the history we have with acquisitions and also what we recently showed you in the Q1. And I think it's fair to say that this pipeline is something this is what CSAM is about. Other companies might look at This might look at a lot of tenders focusing on this. Our business is really about this pipeline.
And I think so. If you ask me to add a flavor, we are comfortable that we will reach our target. And as I mentioned today, I think we are ahead of the plan, and it's just the Q2. It is indeed.
And here is a question from Oliver. Again, coming back to organic growth. What was the organic growth in Q1? Looks like it was above 10%. If so, what is the reason for this strong growth?
And I guess you have just done the calculation, Oliver. So I will It yes, that's you may be right. And so what is the reason for this strong growth? I'd say there are, again, variations from quarter to quarter. We have guided you On the market growth of 5% to 10%, we said at Ceeson, we will grow along with the market, Sometimes a little less, sometimes a little more.
Yes, Q1 appears to be a strong quarter, But I'd say nothing special, natural variations. And you will see Fluctuations between the quarter, sometimes a little less, sometimes a little more, shouldn't worry you. Look at the long term picture. If you're an investor for the long term, Look how we develop in the long term. And we aim to grow with the market 5% to 10%, sometimes a little more, and then the rest Through acquisitions to reach the SEK 1,000,000,000 that remains.
Anything else for that?
No, I think that's it's important to And in the whole value creation model, I would rather do another acquisition, focus on that and security of 50 percent of growth. And then you see the total growth there to rather that than focus on getting an organic growth from 6% to 7% or something like that. Of course, Our salespeople are doing that all the time. But then again, I think you have to understand the business we have chosen, the strategy we have chosen to be in here When you focus on highly specialized components, they are there almost forever. And the other side of that is that you cannot change so much the organic growth.
So again, let's move forward with the higher growth and then keep saying 5% to 10%. That's going to And this time, yes, a bit over, but that's not in main our main focus.
Speaking of sales, This next one from John. Can you specify when you will reach your sales target?
No, I don't think we should guide very specifically, but I think it's if you see the specifics here, what happened in the Q1 and the pro Form a model that Einar showed you with 50% over that growth, I think you will see that as long as we stick to Our strategy here with these acquisitions, and we actually continue doing what we have done also the rest of this year and the years to come. And as mentioned with the pipeline question, I think we are comfortable there as well. Then I think we are ahead of the plan. And of course, we would like to perform as much as we can. At least, we will keep our promise and secured 'twenty five targets.
That's the simple answer.
Yes, we're a bit old school.
Yes, a bit boring actually.
We do what we say we do. All right. Here's a question which believe it's more for me than you, which is about the development in working capital. And again, those who have followed us and also have been with us since the IPO, you know that we have an active view on working capital. And we have a negative working capital, which is positive, and our target is minus 10 or better, and it is better.
Typically, we advance annually, quarterly, semiannually in advance. And we're typically very cash rich at the beginning of the year. And then we deplete those reserves operationally through the year. This What you have seen in the past, there are no changes there really. We don't report on this specifically, but there are no changes.
And we Have had we have and we will continue to have a very active view on net working capital and capital management. All right. Another one, which I also It may be more for me than for you, Sveres, unless you want to go into EBIT adjustment, etcetera. And this is from Karl again. Can you say anything Regarding EBIT adjusted for goodwill depreciation, PPA amortization Yes.
On an LTM basis, what we can say there is that When it comes to PPA, so power plant and all the fixed assets, almost nothing. So If you look at the balance sheet, you'll see that it's dominated by intangibles. Typically, those intangibles are either developed IP, But for the most part, it comes through acquisitions. When we do an acquisition, we do an acquisition analysis and see what is actually we acquired? And it can be 1 of 3 things, is IP, is customer contracts and anything we can't identify is goodwill.
Goodwill and customer contracts amortized over 10 years and IP over 5 years, whether it's acquired or developed. So the amortizations are linked to the intangibles. And That is and you can just assume that the level given the current business The level in the Q1 is fairly representative for the year. But mind you, you will see a notable Increase in amortization from previous periods. And obviously, as we acquire a company and we pay $150,000,000 for Carmenta, That, of course, increases our amortizations as well.
And should we do any more acquisitions through the year, That will again affect the amortizations. So that is really what will affect the amortizations and the EBIT. Okay. And There's a question from Eddy regarding your communicated ambition for 2,030. Still a little time to reach that.
Regarding the number 1 in the world by 2,030 ambition, what Is your view on competition for that position? Are we alone?
We're not alone. But Actually, we have been alone when it comes to creating this position as the leading Nordic player because we have chosen specifically to create a portfolio within these highly specialized areas. And so far, I haven't seen any competitor doing exactly that. Of course, there are competitors inside each of our niches in different markets as always, but they are also targets. So that's one thing.
Then you have the other type of competition like the good acquirers like Constellation Software, People like Nexus and that type of companies that, of course, will also be in this market acquiring companies. So there will be competition. However, when we say that we are able to be dominant in Europe and the rest of the world, I think so far, since we have focused specifically on this, there are a lot of companies in the size of Comantyne Plus Minus That will make it possible for us to actually continue this within different niches that we have, but also other niches. And that's why, I mean, although our competition there, I think we are fairly in a good position after having been trained for 10 years with this acquisition strategy. I think we have the freshest and most important value in our pipeline database as well.
So I feel Quite happy of our position in the competition, although there are, of course, competitors as well.
Okay. Let's take another one from Oliver. And that is, again, on the Q1 breakdown. Approximately what were M and A transaction costs in Q1 and any other nonrecurring or lumpy cost items in Q1. Again, we have decided not to report specifically on one off costs or M and A costs So they are all included in the numbers.
So the numbers we have presented reported numbers, They are all inclusive. So no one offs to be adjusted for. And we're not going to report specifically on that. But you can just I think it's safe to assume that there are M and A costs and transactions costs Impacting the Q1 results, especially when you've done such a big transaction as Carmenta And also had high M and A activity in general, as Svero described. What we have guided that you will find in the report and Primarily report is that in 2020, audit costs, which are At least for a considerable in for a group like us like ours.
They were booked in the Q2 last year, But they are in their entirety booked in the Q1 this year. So if you want to have an absolutely fair comparison between Q1 2021 2020, you could add another €1,000,000 or €1,500,000 to the EBITDA this year because we have the Q1 this year is burdened by costs that were recognized in the Q2, the last year. So you could say the EBITDA this quarter Actually, a little better than it appears.
I think it's also important to add that the reason for us deciding not To report or adjust the EBITDA is that M and A is what we're doing all the time. So I think we should just give you
Okay. Another one from Edi, and That relates to accounting and the stock exchange. Any stat on the status of moving to another stock exchange, I assume you're referring to the main list on all stock exchange or maybe on Stockholm and change to IFRS. Currently, there are no plans to move away from Euronext growth. I'm not saying that it will not change in the future.
It can change. And the IFRS question is very much related to the stock exchange. If we were to move to the main list, we would have to just our accounting principles as well and move to IFRS. That said and right now, we are Consolidating accounting and consolidating according to GAAP, in this case, NGAAP and local GAAP in the various countries in which we operate. But the difference between GAAP and IFRS, not extreme.
You will see some on amortization, and you will see some on office leases. But there's not really a huge difference in this respect. But that said, it's no plans currently. You'll be the first to know. Okay.
And so far, What seems like to be the last question, Sverre, and that's from Herman. And I guess this goes to you. What are your biggest challenges with regards to the M and A pipeline generally and specifically right now?
Well, challenges is, of course, the ability to secure an accelerated ability to make acquisitions because, of course, we have created a plan that we feel are, in a way, as Anna mentioned, conservative. We are able to reach it. So what I'm working on all the time is, of course, to see how can we manage to accelerate. And that is always a challenge. Of course, it has to do with The sequence of things, making the right decisions, the right niches, the right geography, so of course, that is a constant challenge to do the right thing every time.
However, it's a challenge, which is part of the game, and we don't look at that challenge as a problem. It's more like a very interesting position to be in actually now. And we see that the pipeline is it's full in that sense that the world as a target area, The European growth, we've already shown you the Q1, and we see that there are more and more exciting companies coming to us as well. As I mentioned before, the MDR Directive, which is new regulations in European Union, creates A bit problem for smaller acquisition objects because they have cost of being in business increases, getting more and more people contacting us as a good acquirer. We are a good home for their solutions.
So I think, yes, there are challenges like Getting the right object to the right time, on the other hand, there are numerous ones in our database, so we are
The simple answers are the good ones. So I guess what you're saying is that we're just going to continue to do what we have been doing for the last 10, 15 years. In years?
Yes. So I think so. And hopefully, that's the question is about pipeline. We cannot, of course, go into details. But I think the whole thing here is about the specific strategy we have chosen, the focus on highly specialized components and so far Being leading in the Nordic and also growing in Europe, I think we are in the pole position to actually be a European champion and also a world champion over time.
So we stick to that plan, and hopefully, you get comfort when you look at the numbers in the Q1 as well.
Yes. And that was really the end of the questions. No more questions. Before I leave it over to you, Sverdrup, to conclude, I just want to say thank you And for your engagement and for your questions. And over to you to conclude, sir.
Yes. I think just to summarize the highlights, 40% growth, 25% growth in recurring revenue Then the EBITDA at 19%. I think what we've done so far is securing the growth according to plan. I think we're a bit ahead. And hopefully, that should give you comfort that we're here on the right way.
And having said that, Stay healthy. Thank you for watching, and looking forward to seeing you the next time.