North-Brabant-based CM.com, a provider of conversational commerce, on Tuesday, announced its financial results for H1 2024. The results highlighted continued EBITDA strength, record-level gross profit growth, and effective OPEX control.
Here are the key takeaways:
Uptick in gross profit and margin
The company’s gross profit surged by 6 per cent year-over-year, reaching €40.3M, while its gross margin witnessed an uptick, rising to 30 per cent from the previous year’s 27.8 per cent.
2% dip in the company’s revenue
The company’s revenue for the first six months of 2024 stood at €134.4M, a slight 2 per cent decline compared to the corresponding period 2023.
However, this marginal decline was more than offset by the company’s cost management initiatives, which resulted in a substantial 23.3 per cent year-over-year reduction in normalized operating expenses (OPEX), reaching €32.1M.
Turnaround in EBITDA
In H1 2024, the company achieved a remarkable €8.2M in Normalized EBITDA, a turnaround from the €-3.7M recorded in the same period last year. For 2024, CM.com expects a Normalized EBITDA in the range of €14-18M.
CAPEX
CAPEX in the first half of 2024 amounted to €8.9M (of which €7.2M is related to capitalised development hours), which is a 27 per cent decline YoY from €12.2M over H1 2023.
CAPEX versus Revenue improved to 6.6 per cent in H1 2024, compared to 8.9 per cent in H1 2023. CAPEX versus Revenue ratio in Q2 2024 was 5.4 per cent, approaching our mid-term goal of 5 per cent.
Business highlights
In addition to financial aspects, the company also made significant developments in its business operations, claims the report.
The implementation of business units has improved internal alignment, leading to a steady increase in orders. The company has focused on improving bottom-line performance.
Executed the largest Whatsapp campaign in 2024
During the first half of 2024, CM.com provided ticketing and payment services for the KLM Dutch Open Golf, a DP World Tour golf tournament, and various festivals, and executed one of the largest WhatsApp campaigns globally in Q2 2024.
CM.com has secured deals with well-known brands such as Prénatal, a European brand in childcare and toys, and Hedon, one of the largest venues in the Netherlands for concerts and events, attracting over 100,000 visitors per year.
Developed new software features
Additionally, CM.com has developed new software features, including a store-and-forward mechanism for point-of-sale payments to enable offline payments for festivals and other events where stable internet connectivity may be unreliable. The company’s pipeline for the second half of 2024 is progressing well, particularly in Europe.
Key Performance Indicators (KPIs)
Message volume surge: The number of messages processed by the company increased by 33 per cent year-over-year, reaching 4.4B messages. Despite a 17 per cent decrease in voice minutes, the Company’s focus on profitable segments mitigates this impact on overall performance
Growth in Annual Recurring Revenue (ARR): CM.com’s Annual Recurring Revenue (ARR) grew by 6 per cent year-over-year, reaching €32.6N in H1 2024, highlighting the strength of the company’s new order intake and its ability to secure long-term, recurring revenue streams.
The uptick in payments processing: The total value of payments processed by CM.com surged by an impressive 29 per cent year-over-year, reaching a record €1,382M.
Ticketing platform popularity: The number of tickets sold increased by 8 per cent YoY to a record 9.3M, showcasing the success of the Ticketing platform
Outlook
CM.com is expecting its Normalized EBITDA to reach a record €14-18M for the fiscal year 2024, a significant increase from the -€0.9M in the fiscal year 2023.
Additionally, the company anticipates a reduction of at least 15 per cent year-over-year in
Normalized OPEX for 2024.
Furthermore, CM.com aims to achieve positive free cash flow by the second half of 2024. It is also anticipated that there will be no further restructuring costs as the restructuring program has been concluded.
CEO’s Perspective
Jeroen van Glabbeek, CEO of CM.com, says, “CM.com had an excellent first 6 months of 2024. Our software development teams and engineers did a great job at integrating various functions of our platform coming from earlier acquisitions. These evolving integrations lowered the barriers for our clients to use more of our platform. As a result, we see more clients in the business unit Live use our Engage suite, more clients in our business unit Engage use our Connect channels, and the first clients in our business unit Connect use our Payment capabilities and vice versa. All to improve our up- and cross-sell capabilities.”
“At the beginning of 2024, CM.com successfully introduced business units into its organizational setup. The ambition of this new structure is to better deploy all the talents within CM.com and to improve the match between our product offering and the needs of our clients. A positive impact on the new order intake is already visible when looking at the new sign-ups of Prénatal, Hedon, and the contracts we executed in Q2 2024, such as the KLM Open and a worldwide WhatsApp campaign for a renowned brand,” continues van Glabbeek.
“To make sure these developments are sustainable in the future, CM.com continues to invest in its workforce. Recently, this year’s group of young professionals completed their in-house CMBA course. We continue to take great interest in the well-being of our employees and how to make sure they use their talents in an optimal way for CM.com,” concludes van Glabbeek
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