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Efecte Plc's business review on 1-9/2020 - international growth accelerated

Efecte Oyj
·5-min read


Efecte Plc's business review on 1-9/2020 - international growth accelerated


  • SaaS grew by 27% and international SaaS by 82%

  • EBITDA was 0.3 million euro (0.0) and operating profit 0.2 million euro (-0.1)

  • EBIT profitability improved from -2% to 6%

  • Revenue mix developed in line with strategy with SaaS already 66% of net sales (55%)

  • Continued COVID-19 impact visible in Services (-18% YoY) balanced by tight cost control


  • SaaS grew by 24% and international SaaS by 71%

  • EBITDA was 0.0 million euro (-0.8) and operating profit -0.4 million euro (-1.1)

  • EBIT profitability improved from -10% to -3%

Guidance for 2020:
SaaS net sales is expected to grow between 20-25% and profitability to improve from the comparison period.

Group key figures







Net sales












Operating profit






SaaS MRR (1000 eur)






CEO Niilo Fredrikson:

We started the second half of the year with a strong quarter, reaching +27% SaaS growth and improved profitability while continuing to execute our strategy. Solid customer engagement, productivity improvements and cost saving measures helped us deliver Efecte’s first EBIT positive quarter as a listed company. That said, due to release of holiday accruals and limited costs in the holiday period, Q3 is typically our most profitable quarter. We were also helped by cost savings from temporary layoffs, even though we ended them early of the original schedule. Overall, we have still work to do to break even on an annual basis.

The third quarter marked several key milestones on our journey to help service organizations digitalize and automate their work. We used our annual customer event as a vehicle to launch Efecte as the European Alternative in our space to a bigger audience than ever before. Over 1200 people signed up for our two-day "Digitalize & Automate” event and over 1000 persons from 22 countries have watched one or more sessions.

Creating a free trial of Efecte and making it available online in September was an important step for us. It complements our increasingly digital and centrally managed go-to-market efforts. The long-term goal is to build a new approach based on local partners supported by our central team that will reduce the need for Efecte to grow local teams when expanding into new markets.

The acceleration in SaaS growth during Q3 was driven by an exceptionally high +82% growth in international SaaS. In addition, the comparison period was also relatively weak. Services declined year-over-year by 18%, and we expect a year-over-year declining trend to continue also during Q4. While the pandemic is a big factor in the decline, the trend is in line with our strategy: we focus on growing our SaaS net sales and aim to streamline initial deployments of our software to require less consulting work. We have also actively increased the role of our partner ecosystem. This strategy started to manifest itself in our revenue mix, as SaaS represented already 66% of total net sales during Q3.

I am pleased where we are, but I also feel we have only scratched the surface and need to work hard to realize the full potential of this business and this team. The general market remains unpredictable as customers are adjusting to a new normal and we expect this to impact especially new customer acquisition also beyond this year. As we plan for 2021, we assume the market environment is not getting any easier next year. At the same time, we are well positioned to continue growing in line with our strategy and long-term financial targets.


As a proof of our scalable business model, we were able to increase our net sales with a smaller team. The number of full-time equivalent employees at the end of the review period was 102 (107). Of these, 85 were in Finland (87), 6 in Sweden (8) and 11 in Germany (12). The average number of full-time equivalent employees during Q3 was 100 (106). During 1-9/2020 the average was 103 (105).

Finance and investments

The company did not have interest-bearing financial debt at the end of review period. The company's cash and liquid assets were 3.8 million euro (9/2019: 4.3 million euro).

Long-term financial targets

Efecte aims for over 20% annual organic growth of SaaS net sales on average in 2020 - 2023. Substantial investments in international growth and product development will decrease operating profit in the next few years, but the company aims for a double-digit operating profit percentage by the end of the strategy period.

Guidance for the year 2020

SaaS net sales is expected to grow between 20-25% and profitability to improve from the comparison period.

Next earnings release

Efecte will publish the financial statements bulletin 2020 on 25 February 2021.

Additional information:
CFO Taru Mäkinen, +358 40 507 1085
CEO Niilo Fredrikson, +358 50 356 7177

Certified Adviser: Evli Bank Plc, tel. +358 40 579 6210

Efecte Plc

Efecte helps service organizations digitalize and automate their work. Customers across Europe leverage our cloud service to operate with greater agility, to improve the experience of end-users, and to save costs. The use cases for our solutions range from IT service management and ticketing to improving employee experiences, business workflows, and customer service. We are the European Alternative to global players in our space. Our headquarters is located in Finland and we have regional hubs in Germany and Sweden. Efecte is listed on the Nasdaq First North Growth Market Finland marketplace.