“By developing new products, a strong customer focus and continued efficiency measures, we returned to profitability during the quarter.” Karl Thedéen, CEO, Edgeware
THIRD QUARTER OF 2020:
- Net sales totalled
SEK 37.9 million (43.1), a decrease of 12.0 percent. - Gross profit amounted to
SEK 26.1 million (28.8), corresponding to a gross margin of 69.0 percent (66.9). - Operating income (EBIT) amounted to
SEK 2.1 million (neg: 3.6), corresponding to an operating margin of 5.6 percent (neg: 8.4). - Operating income (EBIT) adjusted for restructuring costs and currency effects amounted to
SEK 1.9 million (neg: 2.0). - Profit for the period amounted to
SEK 2.4 million (loss: 2.4). - Cash flow from operating activities totalled negative
SEK 11.9 million (pos: 5.9). - Cash flow for the period was negative
SEK 16.2 million (pos: 2.0).
JANUARY-
- Net sales totalled
SEK 117.9 million (126.9), a decrease of 7.1 percent. - Gross profit amounted to
SEK 80.9 million (85.6), corresponding to a gross margin of 68.6 percent (67.4). - Operating income (EBIT) amounted to negative
SEK 15.5 million (neg: 25.6), corresponding to an operating margin of negative 13.2 percent (neg: 20.3). - Operating income (EBIT) adjusted for restructuring costs and currency effects amounted to negative
SEK 12.5 million (neg: 22.2). - Loss for the period amounted to
SEK 16.2 million (loss: 18.4). - Cash flow from operating activities totalled
SEK 9.8 million (5.9). - Cash flow for the period was
SEK 70.7 million (neg: 18.6), which included the sale of the short-term interest fund ofSEK 75.0 million .
SIGNIFICANT EVENTS DURING THE THIRD QUARTER:
- Edgeware StreamPilot in live production at Norwegian TV 2 Sumo.
- A1 uses Edgeware’s StreamBuilder and OTT-CDN to offer multi-screen TV viewing.
- Edgeware enables 5G optimisation using cloud-based elastic CDN technology.
COMMENTS BY THE CEO
Returning to profitability in third quarter
In the past two years, Edgeware has undergone major changes involving a focus on new products, partially new customer segments and reduced costs. As a result of these measures, we were able to demonstrate during the year that our new product offering has been well received by our customers and today, we are also reporting a positive EBIT of
However, our sales continue to be negatively affected by the corona pandemic, which has resulted in fewer major sports events and heightened caution in relation to new investments in all markets. Sales for the third quarter totalled
The gross margin for the quarter was nearly 70 percent due to favourable underlying product margins and an improved service margin. We also reduced our operating expenses, adjusted for non-recurring effects, by 13 percent compared with the year-earlier quarter. Cash flow was negative
Our new products continued to gain new ground. During the quarter, we added new channels and new traffic to the SaaS-based StreamPilot solution that we delivered to Norwegian TV2 Sumo. A1
During the quarter, Edgeware also conducted a market survey in collaboration with a leading industry analyst,
To summarise, our market remains negatively affected by the corona pandemic, but an expansion of the CDN networks’ capacity is continuing and investments are being made to modernise the networks. Our new products have received a positive market response and overall, it is highly satisfying to see that our change efforts resulted in a positive EBIT for the third quarter.
Karl Thedéen
CEO, Edgeware
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