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COPENHAGEN – Penneo A/S, a Danish software company, reported a strong performance in its third quarter, with an annual recurring revenue (ARR) increase of 27% to 82.5 million Danish kroner (DKK). This figure marks a record high for the company in any quarter, showcasing nearly a 30% surge compared to the same period last year. The growth was primarily fueled by new business (Newbiz) which contributed over 2 million DKK and customer upgrades (Uplift), nearly reaching the same amount, while keeping churn under 1 million DKK.

In light of these results, Penneo has updated its end-of-year ARR forecast to a narrower range of 87-92 million DKK, indicating an expected growth rate of 23-30%. The company’s EBITDA outlook remains unchanged, with projections of a loss between 10-15 million DKK.

Despite smaller initial sales commitments in established Nordic markets due to cautious market sentiments, Penneo has expanded its customer base by adding 113 new clients in the third quarter and a total of 366 in the first three quarters. Belgium has been particularly successful for the company, with substantial customer acquisition and larger deals.

Penneo’s low churn rate of just four percent and the significant ARR from customer upgrades—totaling 1.7 million DKK this quarter—suggests strong retention and potential for further growth. The company is eyeing expansion into Germany, attracted by its market size despite challenges related to digital adoption and electronic identification systems (eID).

The company maintains a solid cash position with nearly 35 million DKK at the end of the quarter and is on track with its investment plan. Penneo aims for an ARR that surpasses operational costs by the second half of next year.

Penneo will share more detailed financial outcomes during an online event today at 10:00 UTC, with preliminary questions addressed through interactions on the Stokk.io platform. Additionally, HC Andersen Capital will host a webinar to discuss Penneo’s financial status later today at 13:00 UTC.

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