Research note


Talkpool: Q1’18 preview, first clean report

Talkpool will publish their Q1’18 report on Friday, the 25th of May. We expect strong revenue growth and sales of approximately EUR 7.2m. The revenue growth is expected to be driven by the acquisition of LCC, which will add EUR 2.4m in sales. We expect Talkpool to report EBITDA around EUR 0.51m.

We expect that Talkpool will report a strong sales growth and gross margin due to that LCC will for the first time be fully included in the first quarter results of 2018. We forecast that Talkpool will report revenue of EUR 7.20m, which corresponds to a sales growth of 108 % Y/Y. Regarding earnings, we expect EBITDA of EUR 0.52m, mainly driven by increased sales in the Benelux as well as in the Middle East region.

In regards to the gross margin, we believe that Talkpool will achieve a gross margin of 23 %. From a cost perspective, we believe that Talkpool will have a higher SG&A cost which is mostly related to the integration of LCC and higher cost associated with the investments in blockchain and IoT.

In the last quarter (Q4’17), Talkpool reported sales in Mauritius which was lower than expected. This was due to a delay in a fiber project for Huawei. It is not the first time Talkpool has shown difficulties in their operations in the African region. For this reason, we estimate no sales from Mauritius in Q1’18 as we believe that the problems may remain.

The Q1’18 report will be published Friday the 25th of May. We will get back with a comment following the release of the report.

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