In 2023 cBrain grew revenue by 27% and delivered record high earnings before tax margin (EBT margin) of 34%

By Globe Newswire Published on February 22, 2024, 14:56 IST

Company Announcement no. 03/2024

In 2023 cBrain grew revenue by 27% and delivered record high earnings before tax margin (EBT margin) of 34%

Copenhagen, February 22, 2024

Total revenues grew by +27% to DKK 239m in 2023, up from DKK 188m in 2022. Earnings before tax (EBT) grew by +66% to DKK 81m in 2023, up from DKK 49m in 2022. cBrain (NASDAQ: CBRAIN) thereby reports record high earnings before tax margin (EBT margin) of 34%.

cBrain is well on track and executes the 2023-2025 growth plan. The growth plan is based on organic growth, combined with a strong positive cashflow.

Fully aligned with the 2023-2025 growth plan, total software revenue, which is based on software licenses and software subscriptions, grew +40%, to DKK 189m in 2023 up from DKK 131m in 2022, while implementation and support services declined by -5% to DKK 50m in 2023, down from DKK 52m in 2022. Software thereby counts for 79% of total revenues in 2023.

The results are based on a solid development in Denmark as well as internationally. International sales grew +30% to DKK 81m in 2023, up from DKK 62m in 2022. International sales thereby count for 34% of total revenues in 2023.

In line with previous years, subscriptions count for more than 50% of total revenue in 2023, and cBrain is incredibly pleased to see solid growing subscriptions revenue. The majority of software subscriptions are based on capacity, which is calculated by active numbers of F2 users and modules, and the actual capacity usage is measured and invoiced by the end of each quarter.

cBrain recognized a significant jump in subscription revenue during the fourth quarter of 2023 due to increased usage of the F2 digital platform across the user base. The addition of more F2 users and more F2 modules to the subscription schemes demonstrates a high level of customer loyalty and user satisfaction.

In parallel cBrain came in with lower-than-expected costs. This further increased earnings before tax (EBT).

cBrain is well on track with the 2023-2025 growth plan
By leveraging standard software, cBrain offers government organizations fast digital transformation at scale. cBrain thereby challenges one of the largest global industries, government digitizing, and faces a huge business opportunity. To capitalize on this opportunity, cBrain has initiated a 3-year strategy covering the period 2023-2025.

While maintaining and growing the current business, the goal of the 2023-2025 growth plan is to further accelerate growth by investing in the ”F2 Climate software” and the ”F2-for-Partners” concept.
F2 Climate Software serves as a door opener and accelerator for international sales. Investing into the ”F2-for-Partners” concept aims to build an F2-ecosystem of customers and consulting partners, which allows cBrain to increasingly outsource implementation services.

cBrain continues to win market shares in Denmark
In Denmark cBrain grew the F2 customer base and added a solid number of new customers. This included 3 Danish ministries and several agencies, as well as the second largest Danish Municipality.

In parallel cBrain won a number of larger projects. Such projects demonstrate that cBrain is well on track, “moving up market,” and challenges the traditional Big IT vendors, as cBrain offers customers configured F2 standard software as an alternative to traditional custom-built solutions.

In 2023 this e.g., included the delivery of a number of grant management solutions for the Danish Energy Agency (Energistyrelsen), inspections for the Work Environment in Denmark (Arbejdstilsynet), and delivering a new hunting license solution for the Danish Environmental Protection Agency (Miljøstyrelsen).

Internationally cBrain work across multiple countries
Over the recent years, cBrain has successfully attracted its first customers across various countries.

Currently, cBrain has a customer base that spans France, Germany, Guyana, Kenya, Romania, the United Kingdom, the United States (USA), and the United Arab Emirates (UAE). In 2023, cBrain further expanded its presence to Ghana and India.

In order to support and scale international sales, cBrain has established an international business development organization with staff in Australia, France, Kenya, the USA, and the UAE.

Opening up new markets is still a priority for cBrain. As examples, cBrain was in 2023 awarded the first project in Romania. In December 2023, a Romanian language version of F2 was delivered by a local partner, who is now building a business based on the F2-for-Partners concept.

Awarded company of the year by German-Danish Trade Organization
cBrain continues to win new tenders in Germany. By delivering a number of F2 based projects for Deutsche Rentenversicherung, cBrain has established a solid position in Germany, and in December 2023 cBrain was awarded Danish company of the year by the German Danish Chamber of Commerce (Dansk-Tysk Handelskammer).

The German government has a strong focus on digitizing and by reusing Danish experiences it is possible to accelerate the digital transformation. cBrain has been awarded company-of-the-year due to the results which has been achieved as supplier to German public organizations like Deutsche Rentenversicherung.

cBrain has now initiated a collaboration with the German Danish Chamber of Commerce for cBrain to help and accelerate the transformation within German public sector. The German Federal Ministry for Economic Affairs and Climate Action support German Danish Chamber of Commerce.

F2 Climate Software serves as international door opener
In spite of significant investments, government organizations across the world struggle to accelerate the fight against climate change. One major obstacle is that it often takes years to execute political decisions due to bureaucratic delays, which are fueled by the lack of digitizing and inefficient IT systems.

In close collaboration with Danish government organizations, like the Danish Environmental Protection Agency (Miljøstyrelsen), cBrain has developed a large library of solutions, which is called climate software.

F2 Climate Software helps to close the time gap from political decision to execution
F2 is standard software, based on reusable open-source configuration and best practices, and F2 Climate Software can therefore easily be reused and adapted across the world and help government organizations to accelerate the deployment of climate action initiatives.

Denmark is a global leader within government digitizing and a global leader with respect to climate action, and cBrain notices a strong interest across the world to learn from Danish government experiences and relevant digital solutions like the F2 Climate Software.

In March 2023, cBrain participated at the United Nations Water Conference in New York. In parallel, the United Nations Department of Economic and Social Affairs adapted a library of blueprints for digital water governance, which has been developed in close collaboration between cBrain and the Danish Environmental Protection Agency (Miljøstyrelsen).

The blueprints define standards and best practices for e.g., environmental permitting, protection of water resources, and wastewater inspections for the benefit of governmental organizations around the world.