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    ALKLK   FR0013156007

KERLINK

(ALKLK)
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Kerlink : “Serve IoT 2025” Strategic Plan

10/25/2022 | 01:24pm EST

Strategic plan

SERVE IOT 2025

Shaping a Smarter World for Humanity & Environment

Kerlink® in 2025: a high-growth and profitable Group

Milestone of €40m, i.e. double the 2021 level

EBTIDA margin: 15%

YTD revenue to end-September 2022: +20% (vs. same period in 2021)

2022 target confirmed:

Revenue growth topping €20m

PRESS RELEASE

Thorigné-Fouillard,France - 25 October 2022, 6.00 p.m.

Kerlink(AKLK FR0013156007), a specialist provider of networks and solutions for the Internet of Things (IoT), today unveiled its new three-year strategic plan, "SERVE IoT 2025 ", which will enable the Group to consolidate its position as one of the world leaders in IoT and to establish a new path of sustainable growth and profitability.

An IoT market disrupted by heightened environmental requirements and the arrival of new technological and economic trends

Kerlink Group has decided to implement an ambitious strategic plan to take advantage of growth opportunities in a market undergoing profound changes with heightened requirements around:

  • Energy efficiency, requiring enhanced monitoring and management of raw materials and energy production and consumption.
  • Reduction of greenhouse gases, requiring energy performance monitoring and stricter controls on the use of resources to reduce human activities environmental footprint.
  • Combating the effects of global warming, requiring increased efforts around the monitoring and protection of natural resources (water, soil, plant cover, wildlife, etc.).
  • Increased regulatory constraints and fiscal pressure in a more difficult and volatile economic and geopolitical environment.

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Alongside developments to meet these requirements, new technological solutions are emerging, and different business models are helping to reshape the IoT landscape and speed up its transformation, with new opportunities that the Group is now in a position to reach.

Among these myriad opportunities, the Group is particularly focused on:

  1. The advent and anticipated growth of Blockchain, which has led to the monetisation of data concurrent with their "notarization" (verification of evidence of electronic exchange and archiving in order to make data authentic and auditable).
  2. The progress of Edge Computing (optimisation method that involves processing data on the periphery of the network, as close as possible to the data source) to limit the impact of data transmission and storage and thus reduce the carbon footprint of cloud computing.
  3. Greater segmentation of IoT protocols with the increased adoption of LoRaWAN®, a protocol around which the Group has developed specific expertise since 2013, giving it a leading edge on the market. The emergence of this unique type of "unlicensed LPWAN " technology should support the expansion of the IoT market by stimulating the use and interoperability of the different networks.
  4. Confirmation of the ramp-upof private networks (businesses, industries, cities, local authorities, etc.) with specific requirements, a market on which Kerlink achieved a successful strategic pivot in 2019.

Kerlink is now ideally positioned to take full advantage of these changes. The Group will be able to draw on its technological expertise and partnerships, and its extensive market reach, with locations around the world.

In this context, the launch of the "Serve IoT 2025" plan should enable the Group to begin a development cycle that will help it to double its revenue.

Serve IoT 2025

Under this plan, the Group will focus from an R&D and commercial perspective on three priority verticals:

  • Smart Cities & Quality of Life, combining multiple market segments such as smart energy meters, smart building management, public lighting management systems, waste management, parking space administration, air quality measurement and pollution prevention, remote infrastructure supervision and management, and more.
    Set to account for more than 70% of the world's population in the near future(1), cities are already facing new challenges. With more than 55% of greenhouse gas emissions(2) and increasing pressure on water resources, the issue of the fitness for habitation of megacities implies an increasing availability of services offered by municipalities.
    Considering this, safety applications, as well as those aimed at optimising waste and domestic refuse treatment and the monitoring of pollution and sanitation, will become increasingly important in the investments of the local authorities and the private sector concerned. Kerlink already has a portfolio of proven solutions to address these issues.
  1. Source: World Urbanization Prospects 2018: Highlights
  2. Source: OECD Environmental Outlook to 2050: The Consequences of Inaction - Key Facts and Figures

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  • Smart Building & Industry, which covers the supervision of occupancy of premises, monitoring of air quality, lighting, heating and ventilation, as well as asset management, maintenance and protection.
    In this segment in which electricity consumption of industrial and commercial buildings is expected to account for half of the electricity consumed worldwide and in which 30% of electricity is wasted
    (3), Kerlink also intends to increase its penetration through its solutions. These solutions will enable the Group to showcase its expertise in the areas of energy efficiency, control of the use of water resources, measurement of pressure or control of fluid levels through, for example, the management of heating, ventilation and cooling systems.
  • Smart Agriculture & Environment, covering precision farming and smart farming, environmental protection and anticipation of natural phenomena, guarantee of food quality and safety during processing and along the supply chain, protection of natural environments and endangered species, etc.
    This segment, which is particularly critical for the future, is a fundamental vector for the wide distribution of IoT solutions. With nearly 10 billion inhabitants by 2050(4), pressure on agricultural resources is expected to intensify, favouring the deployment of targeted solutions.

To seize the growth opportunities of these different markets, the "Serve IoT 2025" plan is built around three strategic pillars:

  • Free the Internet of Things by adopting technologies and best practices to densify cellular networks through Edge Networking. The aim of this strategic focus is to position Kerlink's new generation of equipment as an active component of the IoT infrastructure covering the final kilometres and, thus, granting the flexible connectivity needs for targeted applications. This evolution in the network architecture model will also add further value to this equipment (with embedded data processing capacity) that should lead to in an increase in recurring revenues generated by these services.
  • Target massive IoT by strengthening partnerships with key players, vertical integrators and service operators in strategic areas that have already been identified, such as building management or smart water and gas meters, for example.
  • Strengthen the Group's activity with "private network" customers by offering ready-to-usesolutions and user-friendlydeployment and supervision operations. This will reduce decision-makingcycles and increase the number of projects.

Ambition for 2025: Increase revenue to double the 2021 level and obtain EBITDA of 15%

The implementation of the plan will help Kerlink to consolidate its position as a leading global IoT player. Its forward integration in the value chain as part of this new strategy should also support future growth, increase the contribution of recurring revenues and bolster profitability.

By 2025, the Group aims to make more than €40m in revenue, or average annual growth of nearly 19%. Entirely through organic means, this growth should come jointly with a strong increase in operating profitability, to give an EBITDA target of 15% of revenue by 2025. These ambitions do not incorporate the revenue potential associated with crypto-based solutions, given the reduced visibility currently on the growth prospects of this market.

As it embarks on this new growth cycle, Kerlink has a well-managed financial position, which was recently strengthened by new four-year bank loans signed with five partner banks for a total amount of €6m.

  1. Source: 1990 - 2018 Level U.S. Greenhouse Gas Inventory
  2. Source: Food and Agriculture Organization of the United Nations Rome, 2017

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William Gouesbet, co-founder and Chairman and CEO of Kerlink, said about the plan: "This ambitious strategic plan is based on limited funding needs, and we do not expect it to require any dilutive transactions. The investments and innovation that the Group aims to achieve are based on organic and profitable growth, driven notably by the development of our distribution network.

Revenue in the year to end-September up 20%

In the year to end-September, sales came to €13m versus €10.8m, up 20% on the same period in 2021. This incorporates the third quarter revenue contribution of €2.9m versus €3.2m in the third quarter of 2021. This quarterly change is mainly due to the decline in orders in the Americas, in connection with the collapse of the crypto market. As a reminder, the third quarter of 2021 had seen strong sales of equipment intended for the deployment of the Helium network.

The fourth quarter is expected to show a high level of activity, enabling the Group to achieve its full-year revenue target of more than €20m, up from its 2021 level.

Revenue from IoT solutions

Cumulative

by business area

as at 30

% of total IoT

Q3 2022

Q2 2022

Q1 2022

September

9M 2022

2022

In thousands of euros

Private operators

10,625

83%

2,507

4,992

3,126

Smart Cities & Quality of Life

2,656

21%

869

1,104

683

Smart Building & Industry

6,807

53%

1,322

3,237

2,248

Smart Agriculture & Environment

1,162

9%

316

651

195

Historic telecoms operators

2,238

17%

387

1,242

609

Sub-total IoT solutions

12,864

100%

2,894

6,234

3,736

Revenue HNT cryptocurrency

97

15

20

62

Total

12,961

2,910

6,254

3,798

IFRS - Unaudited figures

Revenue by

Cumulative

Cumulative

geographic region

as at 30

as at 30

Change

Q3 2022

Q3 2021

Change

(excluding cryptocurrency

September

September

revenue)

2022

2021

In thousands of euros

NCSA (Americas)

1,200

1,661

-28%

157

347

-55%

APAC (Asia-Pacific)

2,232

786

184%

286

300

-5%

EMEA

9,432

8,311

15%

2,451

2,532

-3%

Total IoT solutions

12,864

10,758

20%

2,894

3,179

-8%

IFRS - Unaudited figures

Revenue by

Cumulative

Cumulative

type of sales

as at 30

as at 30

Change

Q3 2022

Q3 2021

Change

(excluding cryptocurrency

September

September

revenue)

In thousands of euros

2022

2021

Equipment

9,476

8,202

16%

1,902

2,193

-13%

Services

3,388

2,556

36%

992

986

1%

Total IoT solutions

12,864

10,758

20%

2,894

3,179

-8%

IFRS - Unaudited figures

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About Kerlink

Kerlink Group is one of the world's leading providers of connectivity solutions for the design, rollout and operation of public and private networks dedicated to the Internet of Things (IoT). Its comprehensive portfolio of solutions includes industrial-grade network equipment, best-of-breed network core, network operations and management software, value-added applications and expert professional services, backed by strong R&D capabilities. Kerlink specialises in access to smart and scalable IoT connectivity for three main areas: Smart cities and quality of life - urban operations, energy distribution and metering, retail and public places, infrastructure and trade centres, quality of life and health; Smart Building and Industry - buildings and real estate, industry and manufacturing, asset monitoring and tracking; and Smart Agriculture and Environment - precision agriculture, livestock monitoring and farming, environment and climate, protection of fauna and flora. More than 200,000 Kerlink installations have been deployed at more than 350 customers in 70 countries. Based in France, with subsidiaries in the United States, Singapore, India and Japan, Kerlink is a founding member of the boards of the LoRa® Alliance and the uCIFI™ Alliance. It is listed on Euronext Growth Paris under the symbol ALKLK.

For more information, please visit our website at www.kerlink.com.

or follow us on our social networks - Twitter @kerlink_news, LinkedIn #Kerlink, YouTube - Kerlink

Kerlink Financial Press :

Kerlink Press Contact & Market Analyst :

Actifin

Mahoney Lyle

Isabelle Dray

Sarah-Lyle Dampoux

+33 (0) 1 56 88 11 29

+33 (0) 6 74 93 23 47

idray@actifin.fr

sldampoux@mahoneylyle.com

Kerlink Investors Contact:

Actifin

Benjamin Lehari

+33 (0)1 56 88 11 25

blehari@actifin.fr

Upcoming Event

2022 Full Year Revenue: January 24, 2023

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Disclaimer

Kerlink SA published this content on 25 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2022 17:23:08 UTC.


© Publicnow 2022
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Sales 2022 18,9 M 20,3 M 20,3 M
Net income 2022 -2,30 M -2,47 M -2,47 M
Net Debt 2022 0,80 M 0,86 M 0,86 M
P/E ratio 2022 -3,03x
Yield 2022 -
Capitalization 7,20 M 7,73 M 7,73 M
EV / Sales 2022 0,42x
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Nbr of Employees 90
Free-Float 88,4%
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Number of Analysts 1
Last Close Price 0,97 €
Average target price 1,00 €
Spread / Average Target 3,09%
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William Gouesbet Chairman & Chief Executive Officer
Christian Queffélec Independent Director
Robert Alfred Frati Independent Director
Catherine Failliet Independent Director
Yannick Delibie Director & Deputy General Manager
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