WOOD Flash – AROBS Transilvania Software: focusing on growth and scale
Management’s message, during the 2Q23 earnings call, is that its focus is on growth right now, with the reason being to achieve the necessary scale to attract – and retain – large customers and orders >EUR 100m. As we flagged in our recent initiation report, these relationships tend to be sticky – a top-tier supplier is more difficult to replace – and generate higher margins over time. It is also where recent acquisitions have been focused and a guidepost for future M&A activity. This was part of the message regarding the planned capital increase, specifically that, despite its strong balance sheet (1H23 gearing at 0.2x), the flexibility of ready cash will allow management to close deals more quickly. However, the corollary to this is, while pursuing scale, driving up the EBITDA margins will be secondary for several quarters at least, in our view.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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