Every time, we are told about Sweden’s higher cost level, which perhaps by 2026 will no longer be a problem, and the dividend will also be at a sustainable level after 2026?
7 Likes
No, although I initially understood it that way myself.
In connection with Q3, it was stated that 40% had been transferred and the goal was to transfer 50% during 2024. I read this as meaning that 10% was transferred during Q4 (40%–>50%). So, 50% is still untransferred.
What puzzles me most is that these 50% will only start bringing savings in H2 2025. If transfers have already been made, why does it take even over a year for the savings to materialize? As far as I understand, the first transfers were already started at the beginning of 2024.
This time the wording didn’t change (Q4 vs Q3), but generally speaking, Talenom has kicked the can so many times that it might be time to switch it, a new one always flies a bit further.
9 Likes
In my opinion, a very peculiar dividend decision, for which it’s difficult to see economic grounds. Hopefully, the business strategy will finally be adhered to in the longer term as well, and they won’t start messing around in a panic. It doesn’t seem like a good message that IT staff are being laid off through co-operation negotiations (YT-neuvottelut) and yet the dividend is increased with gritted teeth.
11 Likes
If there are growth opportunities in Spain, I would skip the dividend (even though I am currently a boring dividend plodder and I should be relieved?)
From Sweden, I expect pain and assume that even though half of the customers were transferred last year, they started with the smallest ones, and customer churn may still come from larger ones, but probably some have already been transferred in all offices, or are some still waiting.
If there is already experience, it might then be helpful with larger customers.
I assume that in terms of revenue, the majority was still untransferred, but quantitatively, 50% of the customers were transferred.
Somehow, I still got the feeling that they will eventually be transferred, and by 2027, we will already have a clean slate!
Hopefully, the competitive landscape will still be okay then.
1 Like
In the webcast, there were a few hopeful comments:
Sweden
- The ratio of customer churn to new customer acquisition is starting to move in the right direction.
- Staff retention has improved recently.
- Staff count now 300 vs. 350 at its peak.
Finland
- May-June was the bottom of the recession based on the Talenom barometer.
- Edit: new sales are performing very well
Regarding Sweden, I had personally feared that Talenom would not be able to compete with Fortnox, but new customer acquisition still gives hope.
In both countries, the economic situation remains challenging. However, Talenom should be in excellent shape when the cycle eventually turns. It’s good that IT development investments can already be slightly reduced.
19 Likes
Even though the quarter’s numbers were what they were, I somehow got the impression from that webcast that the guys were quite relaxed and confident already about the beginning of the year. Perhaps the first month has increased confidence in their operations.
7 Likes
Isn’t anyone worried about Talenom’s balance sheet? Everyone only talks about the result. That doesn’t look good when the assets are quite flimsy.
13 Likes
To me, however, the attitude has felt relaxed and confident about everything they do ever since Huhtala took the helm. This was July 29, 2019.
33 Likes
Yes, it is. But we just stay in the background, because the company is not investment-grade in its own accounting. I’m following with interest.
3 Likes
Listen there about the difficult year
Topics:
00:00 Introduction
00:13 Q4 in a nutshell
00:47 Overall market development
02:03 Normalization of volumes
03:37 Profitability in Finland
04:26 Swedish business operations
08:18 Challenges in integration
09:19 New sales in Sweden
10:48 Cost structure and resource situation
12:07 Situation in Spain
14:16 Profitability improvement in Spain
15:41 Balance sheet position
16:57 Software business
20:50 Outlook for 2025
21:50 Investment levels
23:18 Free cash flow
19 Likes
It’s quite irritating, now that I’m hearing that we should invest and make acquisitions in Spain, yet dividends are being distributed. Wouldn’t it be better to make those acquisitions instead?
37 Likes
Exactly, it might be sensible to put the brakes on both investments and dividends until a possibility for profitable business is demonstrated in Sweden. It’s hard not to think that dividends are distributed solely for the principal owner. Enormous sums of money have been squandered abroad, but returns are still not on the horizon.
5 Likes
Did I misunderstand something about the balance sheet in the interview? I mean, does everything have to hit the mark this year and reach the upper end of the guidance SO THAT the cash flow is positive AND the loan covenant terms aren’t breached?
And a growing dividend is paid (even though a contingency exit was left for the second half of the dividend)
Intense!
Let me add now that I haven’t invested directly in Talenom, but I own a fund where it has a moderate weighting, so I have no reason to wish anything but good for Talenom.
Edit. And the second part of the second dividend is already decided at the spring general meeting, which leaves very little room for maneuver when barely Q1 of the year has passed.
10 Likes
The general meeting decides on the dividend, but according to the proposal, the board will have discretion over whether the second part is distributed. The distribution, in turn, will likely depend on how the year has progressed.
9 Likes
Talenom and Citycon are good examples of how main owners and small investors can have different interests.
Of course, I have been involved in both myself. 
18 Likes
Same here. Luckily, Citycon finally seemed to change its course and stopped paying shares. So it might be possible that such ‘screw-ups’ also provide good buying opportunities if one tries to find something positive.
It also puzzles me a bit that customer satisfaction is at a good level. I myself deal with entrepreneurs and have unfortunately only heard negative things about Talenom. Well, that’s a very small sample, but I wonder if customer churn is mainly due to bankruptcies and other reasons beyond their control, or if customers just leave because of poor service…
3 Likes
We’ll see if the annual general meeting is held in person this year. Hopefully, the coffee buns will be from local bakeries. Fresh sweet buns and thus support Oulu’s business life.
Last year it was remote.
2 Likes
I understood the first part correctly. So, free cash flow is not to be expected without a perfect performance, but the covenants were not related to this now. The covenants are in the form of operating/net debt, and there still seems to be room there. But the idea of money flowing into the company’s cash without additional debt this year is a distant prospect.
Let’s emphasize again about the dividend that the second installment is truly discretionary and it’s possible that only €0.10/euro will be paid in the end. I was thinking what to put into that forecast model now, but I put the whole €0.20/euro. That gives the worst picture of the balance sheet leverage.
29 Likes
Yes, this can indeed be decided even in December. Authorization is sought from the General Meeting, which is valid until the next Annual General Meeting.
7 Likes