Earnings call transcript: ForumPipe Q1 2025 revenue rises, stock gains

ForumPipe Software AB reported its first-quarter earnings for 2025, showing a significant improvement in revenue and profitability. The company posted net sales of SEK 139 million, up from SEK 125 million the previous year. This performance was accompanied by a stock price increase of 1.97% to SEK 25.90, reflecting investor confidence in the company’s growth trajectory and operational efficiency. According to InvestingPro analysis, the company is currently trading at a high earnings multiple, suggesting investors are pricing in strong future growth expectations. InvestingPro data indicates the company has been profitable over the last twelve months, with analysts predicting continued profitability this year.

Key Takeaways

• Net sales increased to SEK 139 million, a year-over-year growth.
• EBIT excluding one-offs surged to SEK 30 million from SEK 4 million.
• Stock price rose by 1.97% following earnings announcement.
• Recurring revenues comprised over 80% of total revenues.
• New product launches and strategic partnerships were highlighted.

Company Performance

ForumPipe demonstrated robust performance in Q1 2025, with net sales reaching SEK 139 million compared to SEK 125 million in the previous year. The company’s focus on recurring revenue streams paid off, contributing to over 80% of total revenues. This strategic emphasis on recurring revenues not only stabilizes income but also enhances predictability in financial performance. InvestingPro analysis reveals that the company’s cash flows can sufficiently cover interest payments, indicating strong financial health. Discover 6 more exclusive InvestingPro Tips and comprehensive financial metrics with an InvestingPro subscription.

Financial Highlights

• Revenue: SEK 139 million, up from SEK 125 million YoY.
• EBIT excluding one-offs: SEK 30 million, a significant increase from SEK 4 million.
• EBITDA margin improved to 21.6% from 17%.
• Recurring revenue growth: 11% year-over-year.
• Annual Contract Value (ACV): SEK 11 million net positive.

Market Reaction

Following the earnings release, ForumPipe’s stock price increased by 1.97%, closing at SEK 25.90. The stock’s movement was largely positive, reflecting investor optimism about the company’s continued growth and operational improvements. The stock remains well within its 52-week trading range, with a high of SEK 30.20 and a low of SEK 22.

Outlook & Guidance

Looking ahead, ForumPipe plans to invest in new ERP ecosystems such as SAP and IFS, with a focus on profitable growth and margin improvement. The company is also considering geographical expansion into the US and Western European markets by autumn 2025, aiming to capitalize on resilient ERP market conditions.

Executive Commentary

CEO Magnus Svenning Son emphasized the company’s growth ambitions, stating, "We are a growing company. We intend to grow and see the need in the market for a product like LaserNet." He also highlighted the dual focus on profitability and growth, saying, "Profitability first, but of course also growth."

Risks and Challenges

• Macroeconomic uncertainty could impact spending in key markets.
• Integration of AI technologies must navigate regulatory landscapes.
• Expansion into new markets may face local competition and regulatory hurdles.
• Dependence on the Microsoft Dynamics ecosystem could pose risks if market dynamics change.

Q&A

During the earnings call, analysts inquired about the company’s new tiered pricing strategy and its approach to integrating AI while maintaining regulatory compliance. The management addressed concerns about macroeconomic impacts, emphasizing their strategic focus on maintaining profitability amidst uncertainty.

Full transcript - FormPipe Software AB (FPIP) Q1 2025:

Fredrik, Moderator/Host: Welcome to the Q1 Presentation with ForumPipe. I will be back later for the Q and A session and you can already now post your questions below the stream. Today, I’m joined by CEO, Magnus Svenning Son and CFO, Sophie Renius. And Magnus, the floor is yours.

Magnus Svenning Son, CEO, ForumPipe: Thank you very much, Fredrik, and hello to everyone listening in. It’s great to be here at Redeye to present the first quarter of twenty twenty five. And as you see in the headline, we have had a good quarter with improvement on all lines. So what do we mean by that? So first of all, the net sales coming in at SEK139 million, which is an improvement from last year’s SEK125 million.

And again, I just want to highlight our recurring revenues that is now more than 80% of our revenues, which is a good quality of our company and our business model. And then we have the ACV, which is strong and this has to do with good performance in our laser business as well as in our public business. And from an EBIT perspective, we are up from SEK4 million to SEK30 million excluding one offs. And this is thanks to good work with cost reductions and also a very solid focus on costs during the quarter. If we look at some highlights, the strong ACV, it is a good amount of expansion in public.

And that means that our clients are using more of our soft wares, more seats, more people using our softwares and that means that we can then increase the invoicing we take from those clients. So it’s more of an expansion play in this quarter when it comes to public. And the Laisinet business is growing primarily in the Dynamics business with 90 new deals. And I’d like to mention two because it says something about the LaserNet business. And one is the caterpillar that is a long since it’s a long time have been using

So we have one expansion with laser with Caterpillar through our EXAP partner. And again, it shows how LaserNet is supporting them with their sort of sophisticated supply of spare parts and everything that needs to get the KT Pillar machines going. And then on the other side of the world, we have Metcash, which is a wholesaler of foods and mechanics and a lot of different things that they distribute to retailers all over Australia. So it shows a little bit how horizontal the lacelet product is. So that is two highlights in the dynamics piece.

Bank and finance has brought in two banks this quarter, which is a little bit slower than expected. So it’s it’s developing okay, but we would have liked to see a little bit more there. And then we have the Tech Track, which I will come back to, but we have done a pilot in one of our municipalities here in Sweden. And coming back also to the fact that we have successfully now started to reduce our costs in Lesenet and also had a good cost focus in our public business. And I really want to extend a thank you to our leadership and our team out in the world for the really, really hard work you have put into keeping the focus on this because it’s so important for us going forward.

And also highlighting our customer days here in Sweden this time. So we had 200 more than 200 governmental officials coming to us here downtown Stockholm, talking about case and document management, of course, and archiving, but of course also what lies around the corner with Microsoft integrations, but also AI and these kind of sort of intriguing technological options that is around the corner. And this is something we do both in Sweden and in Denmark to gather these officials in our user base. So these are some highlights. Now I’ll hand over to you, Sophie, to give a little bit more flavor to our colors flavor to our numbers and then I’ll come back with some more about our progress in our Pursuit Potential program.

Sophie Renius, CFO, ForumPipe: Thank you. Thank you, Magnus. Hello again. Nice to be back, and I’m happy to introduce the Q1 twenty twenty five numbers. And I know this is a busy slide, so I will try to guide you as much as possible throughout these numbers.

But starting with just highlighting a change that we’ve done in the P and L. So we have now broken out other income out of the overall revenue slide. So that means going forward, when we talk about net sales, we are excluding other income. And when we’re talking about our overall total revenue, that is then total income. So just so we realize that there’s been a small change and a more granularity in our numbers going forward.

But then focusing now on the Q1 results and then looking at the continued strong development in our SaaS revenue, growing 25% compared to Q1 twenty twenty four and almost SEK10 million, which is of course great and that’s what we want to see. And then looking into our delivery, so Q1 twenty twenty four was kind of a soft quarter specifically for delivery in the public sector and it’s great to see that we’re now coming back to a much more stable delivery in public area. We also have delivery in the Laisinet division and also here we’ve had a stronger revenue coming from that delivery. But bear in mind that that delivery is done through subcontractors. So that also means that we have higher sales expenses related to this.

So we know what is what. And that means then on an overall basis, we have grown the net income with 12%, which is of course a great and good number total income, sorry. And then moving towards the cost side and the margins improvements that we’ve seen. So we announced in the beginning of the quarter that we were doing cost reductions specifically in the Laisinet industry or Laisinet business area, but then also reviewing the cost throughout the organization. And we can see the effects already now then starting in Q1 with improvements on the personnel side and that means that an overall improvement on our margins going from an EBITDA margin of 17% in Q1 twenty twenty four to now 21.6% in Q1 twenty twenty five.

So a good improvement then both from the revenue side but then also on the cost side. And as I mentioned, we’ve had the restructuring initiatives. We launched them in the beginning of the quarter and of course these come with costs. So we’ve had one offs related to restructuring of roughly SEK8 million and that’s mainly coming from LaserNet but also some in the public business area and also group. So that means if we are then summarizing our overall P and L, that means we have an EBIT excluding the one offs of SEK8 million of SEK13 million compared to SEK4 million that we had in Q1 last year.

So a good improvement then, I have to say. And then diving a little bit more into our growth in the recurring revenue. It’s great to see that on a rolling twelve month basis, we have then million in recurring revenue. We are more than 80% of net sales, which is recurring revenue. And now the net sales I’m referring to is then net sales excluding the other income.

So this is then a more clean KPI going forward. We also see that we have grown from a rolling twelve months perspective 11% year over year in recurring revenue. And if we go back, looking back to 2014, we actually see since then we have grown on a compounded annual growth rate of more than 10% for the past more than ten years. So that really goes to show the stability in the growth in our recurring revenue. And we have actually grown 15% in the last two years.

And now that means with the growth we’re seeing, it means we are now covering more than 105% of our fixed operating costs, which of course is great from a stability perspective and it reduces risks for us as a company. So that’s good to see. And then looking into our annual contract value. So if you look to the right hand side, you see the Q1 twenty twenty five and if you look to the left, you see Q1 twenty twenty four. And of course, as you can see, there has been a lot of movements related to the stabilization of the Swedish krona compared to most other currencies.

And as we are an international company and we invoice in different currencies, not only Swedish krona, this has had a negative effect over the overall ARR of minus SEK19 million. But if you look into Q1 last year, we had a positive effect of SEK 15,000,000. So this is of course fluctuating depending on the stability or weakness of the Swedish krona. So we will see how this will develop going forward. But from a P and L perspective, we are then of course much more stable as we have a lot of cost also in our related currencies.

And then looking a bit more into then the net is ACV, so excluding the FX variances, we have a positive net result of SEK11 million. This is mainly coming from SaaS contracts of SEK9 million and then of support and maintenance deals of SEK2 million. And then instead if we look into the different business areas and how they are contributing to this ACV, we see then as Magnus referred to a strong quarter from both business areas but primarily Laesenet with million in ACV compared to SEK5 million last quarter or Q1 last year. And then public with SEK3 million compared to SEK2 million. And I just want to highlight as well, we talked about this in the last quarterly release about Platina Life Science.

So we have now churned the last two customers for Platina Life Science. So they are included in these numbers. And I think the annual contract value was roughly SEK1.3 million, which is now removed. So there are no longer any contracts in the outgoing ARR related to Platina Life Science. We will still have a little bit of revenue in Q2 and Q3 before these contracts end.

But that leaves us with an outgoing ARR of million and the growth compared to Q1 last year of 6%. That’s it from an ACV perspective. And now I leave it back to you, Magnus. Thank you.

Magnus Svenning Son, CEO, ForumPipe: Thank you very much, Sophie. And when you look at these numbers, it’s obvious that we are doing several things at the same time. So we are pursuing our potential that I’ve been talking about several times, but we are, of course, also looking at improving our numbers continuously. And we have as you know, we have merged our two business areas in Sweden and Denmark into one with the aim of being more efficient in our product development and maintenance, but also, of course, having an impact on the go to market and our communications with our clients and also a little bit downstream with the consultancies and deliveries as well. And on the Laisnet side, we talk about the customer journey overhaul that we will come back to.

So this is what we call the Pursuit Potential program that is also ongoing on a daily basis. Now if we look at one public, I would say most important is the fact that we now have commissioned a pilot in one of the Swedish municipalities. And this is important because we can now see that we can develop and deliver a hybrid solution that is software that is deployable in the cloud but also on prem. And on prem is still important in our customer base, also given the situation in the world with the uncertainties we see. And we also see that our technology stack is working on prem and in the cloud.

So given that we have reached this milestone, it will now be easier with comfort and trust to reach out to other clients, but also to introduce new functionalities like AI, for example, bearing in mind that our clients are risk averse and that they adapt to new technology changes in a moderate pace. If we move over to the Laisinet business, we launched the Essential program here in October to the clients. We’ve been working with it for quite some time. And we continue to learn. And the most recent learning is a large Dynamics system integrator called Alesia, which is now a partner to us.

And they came to us because they see that with our Essentials offering, we make their offering stronger. And it is an appreciation from their side that they are now have a stronger proposition to their customers. We also see an increase in deal sizes. That is that the deals are slowly getting bigger, and it has to do with our four tiered offering. The fact that we can take a larger part of the value from the larger clients and we don’t have to discount to the smaller customers.

So we see a good trend there. And then going forward, continued cost control, of course, very important. But we are a growing company. We intend to grow and we the need in the market for a product like Lesenet. So of course, as we now see improved numbers, of course, we will start investing in new ecosystems like, for example, IFS and which I spoke about last time with the Monitor’s deal or SAP or others.

But we will take that in a moderate pace, focus on costs first. And then the financial targets, we spoke about the revenues. We have ticked that box. The recurring revenues there, we’re actually over performing and doing about 80%. So we ticked that box as well.

And then we have the dividend policies. And for you, shareholders out there, there is a few days more before you have something in the bank account. And now with this report, we are moving, I would say, in the right direction to meet our margin goals during 2025. So this is the summary of our targets 2021 to 2025. Before I round this off, I would like to just do some key takeaways.

I think it’s very, very important now always look at recurring revenues when thinking about Formpipe. Positive margin development every quarter, we are on a good trend there. And then when I say pursue potentials getting ready for next phase, it is that we have now done two significant milestones with the pilot in one of the Swedish municipalities and with the launch of the essential programs. We are now starting to learn from those initiatives, and we will use that learning when looking at new expansion options to roll out more functionalities to our public sector, but also seeing how we can use premium business models or ecosystem to penetrate other markets around Dynamics and the Terminus ecosystem. So that is sort of the key takeaways.

And now Frederic, it’s time for you to start to lead the way to the Q and A session. So that’s why I leave the word to you and also ask Sophie to come up here to support when we start talking, diving into what you have to ask us.

Fredrik, Moderator/Host: Thank you, Magnus and Sophie. Once again, I want to highlight the opportunity to ask questions below the stream. I want to start with the ACV figure in LaserNet, mainly coming from Microsoft Dynamics. You mentioned new packaging as a reason behind it. Could you elaborate a bit more on that?

I mean how is the new packaging transforming into higher sales?

Magnus Svenning Son, CEO, ForumPipe: Good question. And it is we are utilizing what we call a freemium business model, which is that there is a basic offering, an essential offering, essential functionality that is free of charge to the dynamic users. And then we have a 40 tiered package from sort of advanced up to enterprise, which is really the full fledged solution. And what we see now is that the Essentials offering, the freemium version, for a partner like, for example, Alethia that I mentioned in the call, it helps them to when they talk to their clients, they can say that, of course, dynamics, this is very important. You can do all the things you want to do.

But look at the output management piece. Try this out. See how it works. And that gives them a stronger communication and it opens the door for us to get into the dialogue earlier in the sales cycle. So there is sort of two things.

The partner finds it positive to bring us along. And secondly, that you talk about our topic, output management, starts earlier in the sales cycle. It’s not something you do in the end, you start it earlier. And then finally, when you have this four tiered business model, you can also have a starting point that is adequate for you as a client, and you don’t need to say that, Oh, this was going to be too expensive. We wait with that.

You can get going immediately. So that is sort of the learnings we are starting to have now after a few months of operation with this. So and again, with a good number now and the fact that we have this new partner along and they have brought in two or three deals into this quarter, we see that this is probably working.

Fredrik, Moderator/Host: Interesting. And Just one additional question on that topic. I understand the thing with the different tiers and how that brings you more ACV and so on. But if a customer chose the Essential package, that’s the revenue for you. So do you see like do they typically transform and how long does that take?

Magnus Svenning Son, CEO, ForumPipe: That’s a little bit too early to say. I have been working a lot with open source software earlier and that’s why I’m sort of I have quite a bit of experience of these kind of business models. So we have operated this for a too short time to draw any conclusion. What you can say here is that Essentials is very much what it is. It is very, very essential functionality.

You need to do a few things. So there is a limitation in what you can do. And with that limitation, when you discover that, you tend to discover that I want more. So that is sort of the behavior we are hoping for. So I see that as a too large risk that our clients will settle for essentials for many, many years, even though that is an experience I have from my open source background that we had clients that was using our open source version or community versions for many, many years.

So this is a balance, and this is one reason why these learnings

Fredrik, Moderator/Host: to see how we can play this in a way that we contribute to the ecosystem and to our and to the success of our ecosystem and our clients, of course. I see. And just so I understand it correctly, some of the new partners you gained, they were interested in the Laisnet because of the essential packaging, but then they also gave you orders for higher tiers. Is that Exactly.

Magnus Svenning Son, CEO, ForumPipe: So it is it’s as always when you need to start the sales cycle somewhere. And this is a way of making it easier for our partners to start the sales cycle around output management with their clients. And output management is an important area that you as a CFO might potentially say that it’s not always the most important area when looking at the new ERP implementation. So it’s a way to get more attention to this area of the business.

Fredrik, Moderator/Host: Interesting. And let’s stay on Laisonette because there were a lot of new interesting stuff there in this quarter. You touched upon this but still new geographies, new ERPs and new I mean in addition to the new ERPs that you already have mentioned, what are we talking about in terms of geographies and industries?

Magnus Svenning Son, CEO, ForumPipe: That’s a very interesting question, Filrik. And if you look at the two clients I had as an example, Caterpillar and Metcash, totally different businesses. So our offering is completely horizontal, that is all verticals can use it. And this opens up for a lot of opportunities. And given now the what’s happening in the world, of course, United States is very important to us.

It’s a very important market. But you can also see that Europe, Germany, France, the large Western Europe is also a very important area for expansion. Now what we need to figure out, we have been very successful in working with the Dynamics ecosystem. We have also been very successful in working with one of the large ERP suppliers like Temenos. We have an excellent cooperation with those guys.

We see new ERPs in the bank and finance sector coming up, growing slowly. But we now need to figure out where do we see the most potential geographically. Do we really, really need to piggyback on another ecosystem like SAP or IFS? Or is our offering strong enough so that we, together with a freemium business model, can be a little bit more ERP agnostic when growing forward. These are the things that we are now and our team are sort of figuring out.

We’re doing a bit of tire kicking in different ecosystem. But now first and foremost, continue to work with the profitability so that we have resources to do this in a controlled and very methodic manner going forward. I would say we will start this, let’s say, in autumn twenty twenty five, start working more with this. Now we

Fredrik, Moderator/Host: are still in a discovery and learning mode before going forward. Interesting. We look forward to hear more about Yes.

Magnus Svenning Son, CEO, ForumPipe: So do we. We are very curious about that.

Fredrik, Moderator/Host: So last question on LaserNet for now at least. In the quarter, you reached an EBITDA less CapEx margin of 15% and compared to other listed Nordic companies that’s a quite good number actually, although it’s before group common costs, should say. But what’s the potential in Laesenet in terms of profitability going forward?

Sophie Renius, CFO, ForumPipe: Well, it depends a little bit what we talked about the investments we want to do, right? So I think we have now decided that we know we want to continue to grow, but we want to do it in a profitable way. So deciding on that kind of continuous growth path is of course interesting And that will, of course, determine a little bit of where we’re going to land in terms of EBITDA and depending on growth versus margins, right? So but I think it’s fair to say that we want to make sure we have a strong enough margin that we can continue our expansion and do it profitably. That’s something we are very firm in believing.

Yes.

Magnus Svenning Son, CEO, ForumPipe: So profitability first, but of course also growth. We are a product company, we are a growing company, so we should really make sure that we harvest the potential that is out there. But of course in the near term we should be able to do a little bit better in terms of margins.

Fredrik, Moderator/Host: Great. Once again, I want to highlight the opportunity to ask questions below the stream. You’ve announced a cost savings program in last quarter and looking at the numbers, there was a quite significant impact in this quarter. Are you satisfied with the work and what’s left to do?

Magnus Svenning Son, CEO, ForumPipe: I must say that we are very satisfied with the work that has been done. And it’s a really tough decision and it’s very much respect to our leadership and for the very talented colleagues that has left Formpipe and very, very quickly also found new opportunities, which is really nice to see. But yes, I think we have done this in a very efficient manner. And coming back to your question, it is we don’t we see a good impact. We see a well performed program and we see that we will continue to focus on this, but it won’t be the primary focus going forward.

Will start to investigate new routes to growth.

Fredrik, Moderator/Host: Okay. So let’s continue to the public segment. And as you mentioned, deliveries had a quite solid growth. And a few years ago, you had some initiatives in Sweden where you wanted to do more in house. And to be honest, there hasn’t been that much of growth until perhaps this quarter and last quarter.

So is that really having an impact now? Or what is that we see in the numbers?

Magnus Svenning Son, CEO, ForumPipe: So we did this there are a few things here I would like to highlight. One is that a year ago, we spoke about the there was a bit of turbulence in our Danish operations. So and that is now working very well. And we made this initiative around partnerships, etcetera, to bring more deliveries in house, and that has to do with wanting to deliver consultancy services really related to our products, allowing us to make our products better, allowing our customers to get fast support with really the adequate staff and also avoiding a bit of the price war that was going on with our partners. So to a certain extent, we see the result of that in terms of, one, us bringing in some more resources and also that we see that the price tag on our rates is going up because we are now more focused on our specific type of technologies.

But again, I also want to say that deliveries are very important to us, but we are not a very big delivery or consultancy shop. It is an important part of our business model, but we are not like the big consultancy players as you know.

Fredrik, Moderator/Host: Yes, yes. Great. So continue about the customer testing, the new functionality. I mean, you’ve touched upon it, but could you give us some additional hints about what kind of functionality we’re talking about?

Magnus Svenning Son, CEO, ForumPipe: Yes. I mean, if you look at if you read one of your previous reports that you have written, you said some there is something like, yes, there is a rich product portfolio here, there’s a lot of products And they have been around. They are very well proven. And that is absolutely the case with our with the product portfolio we have in public. It is rich.

There is, to a certain extent, if you try on a high level, there are some overlaps. And it’s been around, so it’s very well proven. Now if you want to add on more sort and if you keep that as it is, it drives maintenance costs and it drives also development costs because you need to develop stuff several times and that’s not a good thing. So what we have achieved now is to apply technologies allowing us to sort of break out functionalities that can be common and you can develop them jointly for the platform and that is very important. And then you but to do so, you also need to apply certain methodologies to develop this and to distribute this to the customers.

And what our piloting now shows is that we have gotten that in place and we have also gotten in place a technology stack that we can use in on prem and in the cloud and the technology stack is typically operating systems and databases, application service and these kinds of things. That needs to be working as well. So having this, the joint functionality, the development and distribution process and then the technology stack in place, that then leaves you with the option to apply that technology stack on several customers, but also apply the development process on new offerings. So we started this with a very, I wouldn’t say simple, but it is a very square functionality, which is related to Microsoft Outlook and e mails, which is very important for our case managers, bringing that to the market. Now when we see that this now is working, then we can add up add on more, I would say, complex functionalities like, for example, AI.

And when using that terms, of course, need to be a bit careful. But public sector always need to do more with less. And of course, when you look at the cases that our case managers are working with, you need to summarize those, You need to do certain things with this. And this is where automation or AI can be very useful. But then again, we also have the AI legislation where you tend to group this in a number of groups where a part is sort of being looked at as sort of a little bit forbidden.

But then there are some areas which are very regulated, and then you have some sort of common AI type of things to do when you use OpenAI or ChatGPT. And we are sort of in the middle here or on the a little bit high up in this hierarchy where you really need to be careful with how you apply the technology. And of course, our clients need to be very careful on how they apply the technology so that your personal data as well as mine and Sophia’s are safe. And this is where we now start to have learnings on the public side as well as we had learnings with Ascensions and LaserNet, how does it work on the market. We can now start to learn together with our clients how we roll this out.

And then I must say that we are doing this then together with improving the margins. So we have a lot to do in front of numbers. Absolutely.

Fredrik, Moderator/Host: I see. Okay. So you perhaps you could put it like a proof of concept for the new strategy within public.

Magnus Svenning Son, CEO, ForumPipe: Yes. And it is with true caseworkers, true data, etcetera. So it is really testing the full technology stack. Interesting.

Fredrik, Moderator/Host: So let’s continue to the macroeconomic environment. I mean there’s a lot of uncertainty out there. The picture I get from Nordic IT consultants at least is that ERP is relatively resilient compared to other areas perhaps. But I mean, what’s your opinion of the environment? And also how might it affect Formpipe going forward?

Magnus Svenning Son, CEO, ForumPipe: Interesting observation there because that is also when I talk to my team, that is also my observation that ERP, you always everyone has to work with the ERP, everyone has to sort of continue to improve it and we are a small and vital part of that improvement. So our take so far is that probably not that impacted. Very hard to say short term though, but very we don’t think that it will be too much of an impact. When you look at the public business, again, term, a bit of uncertainty maybe around delivery revenues. Going forward, I’m positive around what this change will make to the European IT industry because I think that now European IT industry has and can be able to step up and do a lot of things.

And there are so many interesting companies doing infrastructure that is similar to the hyperscalers. So I think this is a big opportunity for European IT industry and Formpipe is a part of that. And when you look at what we do for our clients, there are, of course, things we can lift off and, over time, migrate from the hyperscalers. Now that also requires our clients to land in how do we long term sort of exit from the hyperscalers or decouple from the hyperscalers and what must be decoupled and where can we utilize this fantastic functionality that the hyperscalers are offering to us. But that is sort of a separate dialogue.

But it is an interesting area that lies a bit ahead of us. But I’m positive in general how the changes are impacting Frontpipe.

Fredrik, Moderator/Host: I see. So last call for any questions from the web. And lastly, you will continue to simplify the group and decentralize further. Why is that?

Magnus Svenning Son, CEO, ForumPipe: That’s a good question again. And we made, was it 2021, ’20 ’20 ’2 or so, there was sort of a little bit of a strategy work being done where you can conclude that the synergies between public and LaserNet is they are not obvious. So this is a natural extension of simplifying the group structure so that the legal entity reflects the business areas so that, one, the leadership of the business areas can be more self sufficient in how they operate their respective companies, but also, of course, facilitating inorganic growth, etcetera, going forward so that it will be easier to acquire but also less invest certain assets, etcetera. So that is the purpose of doing so. And it’s more of an administrative exercise even though it will probably require a little bit of work from the people in the organization.

Fredrik, Moderator/Host: Thank you very much, Magnus and Sophie.

Sophie Renius, CFO, ForumPipe: Thank you.

Magnus Svenning Son, CEO, ForumPipe: Thank you very much, Frederic, and thanks everyone.

Sophie Renius, CFO, ForumPipe: Thank you.

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