Gold prices steady ahead of Fed decision; weekly weakness noted
Introduction & Market Context
StrongPoint ASA (OB:STRO) presented its Q1 2025 financial results on April 29, 2025, showing signs of recovery in profitability despite a slight decline in overall revenue. The retail technology provider, which focuses primarily on grocery retailers across Europe, reported improvements in EBITDA and continued strong growth in recurring revenue streams, signaling progress in its strategic transformation.
The company’s stock closed at 8.96 NOK on April 28, down 2.61% ahead of the earnings release, reflecting cautious market sentiment.
Quarterly Performance Highlights
StrongPoint reported revenue of 347 million NOK for Q1 2025, representing a 3% decrease compared to the same period last year. However, the company achieved significant improvement in profitability with EBITDA of 10 million NOK, a substantial recovery from the negative 21 million NOK reported in Q1 2024.
As shown in the following chart of quarterly revenue performance, while Q1 2025 revenue declined year-over-year, it represents an improvement from Q4 2024:
The company’s recurring revenue streams showed robust growth, reaching 372 million NOK on a rolling twelve-month basis, a 17% increase compared to Q1 2024. This growth was primarily driven by a significant 68% increase in license revenue, attributed to strong performance in Order Picking and Self-Checkout solutions.
The following chart illustrates StrongPoint’s consistent growth in recurring revenue components:
Detailed Financial Analysis
StrongPoint’s EBITDA recovery represents one of the most significant improvements in the company’s quarterly performance. The 10 million NOK EBITDA in Q1 2025 marks a 31 million NOK improvement compared to Q1 2024, resulting in an EBITDA margin of 2.9%.
The company’s quarterly EBITDA trend is illustrated in the following chart:
StrongPoint ended Q1 2025 with a cash balance of 85 million NOK, a slight increase from 82 million NOK at the end of 2024. The company secured a new loan of 20 million NOK during the quarter, while capital expenditures amounted to 11 million NOK. Net interest-bearing debt stood at 72 million NOK, up from 60 million NOK in Q4 2024.
The following chart shows the evolution of StrongPoint’s net interest-bearing debt:
Strategic Initiatives
StrongPoint continues to expand its retail technology footprint across Europe. The company secured its first AutoStore win in the UK with a leading cosmetics retailer, marking an important milestone in its automation strategy. The solution will be used to support e-commerce orders, leveraging AutoStore’s new compact solution through a partnership with Pio.
The company is also advancing its theft prevention technology, launching a third Vensafe proof-of-concept with UK grocery retailer Morrisons. This installation features the newly launched ’Digital Media Retail’ Vensafe, which includes screens at the shelf and dispenser that can run advertisements, creating additional retail media revenue opportunities.
As shown in the following overview, StrongPoint offers a comprehensive suite of solutions addressing key challenges in grocery retail:
StrongPoint has formalized a partnership with SAI Group to provide AI-powered anti-theft solutions, combining StrongPoint’s store integration capabilities with SAI’s computer vision technology. The company currently has two active pilots with leading grocery retailers in the Nordics.
The company’s core business profile is summarized in the following overview:
Forward-Looking Statements
Looking ahead, StrongPoint expressed cautious optimism about short-term prospects while maintaining a positive outlook for longer-term trends. The company expects to achieve growth through further development in profitable traditional markets, capitalizing on investments in new markets, and pursuing global opportunities with its SaaS e-commerce fulfillment solution.
The ongoing installation of order picking solutions at Sainsbury (LON:SBRY)’s is expected to be completed across all targeted stores by summer 2026, with an updated schedule accommodating additional functionalities. StrongPoint is also continuing the development of its CashGuard Connect solution with Spain’s largest grocery retailer, with additional pilots planned and ongoing discussions with several other potential customers.
StrongPoint’s balanced approach to traditional retail technology and innovative solutions positions the company to benefit from the ongoing digital transformation in the retail sector, particularly in grocery, which represents over 80% of its revenue base.
Full presentation:
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.