Yesterday, Fortnox announced that its application to become a payment intermediary had been approved, approximately four months after the application was sent. We argue that four months is a rather short period of time in this case and it indicates that Finansinspektionen did not have any major question marks regarding Fortnox's plans. There are examples of other applications taking way longer.
Becoming a payment intermediary is the first step towards a complete financial platform for Swedish SMEs and allows for increased automation. Fortnox will soon be able to offer accounting, invoicing, and payments in a single system.
Fortnox expects to have the first offerings available for customers during 2020 and then gradually add additional services. This strengthens our view that the ARPC contribution from Fortnox Finance will increase substantially from 2021 and onwards.
We believe Fortnox will add a net of 10 000 new customers during Q3. We expect the ARPC to increase by an impressive 16% YoY, mainly due to bundles and pricing adjustments made over the last year. We forecast a YoY sales growth of 42% and an EBIT margin of 38%. Fortnox will release its Q3-report on Thursday, October 24, probably 08:00-08:30 CEST.
We believe Fortnox will continue its solid net customer intake. In Q3, we expect 10 000 (11 000). While we forecast only a minor increase in ARPC relative to Q2, the YoY growth will still be substantial at 16%. That is mostly a result of bundles and pricing adjustments made over the last year. In total, we forecast a YoY sales growth of 42% - a slight increase relative to last Q3’s 38% as a result of higher growth in ARPC.
Our Q4 estimate implies an order backlog of approximately SEK 400m in Q3, and significant deviations will likely cause estimate revisions.
We assume Fortnox will continue to expand in terms of employees, and we forecast a net addition of 22 during Q3. Despite the rapid expansion, we expect Fortnox to increase its EBIT margin to 38%.
By clicking "Sign up" you indicate that you read and agree to our Terms & ConditionsI already have an account and want to sign in