Dear shareholders – we start the year with strong growth, reduced loss and positive cash flow.
During the first quarter of the year, we have made important progress in all subsidiaries and can demonstrate many successful synergies between our companies. We close the first quarter with a group turnover of SEK 46 million, which corresponds to a growth of 22 percent. We have seen strong growth at the same time as we improved our operating profit by 24 percent compared to the previous year. In summary, we are in line with our budget, we exit the quarter with a cash balance of approximately SEK 12 million and we are following our plan towards becoming a globally scalable and profitable company this year.
All our subsidiaries are keeping to their respective budgets. The total loss during the quarter is partly due to seasonal effects, as well as the fact that some of the restructurings carried out in 2022 continued to burden the result in the first quarter of 2023. These restructuring costs have so far been fully expensed and will not be carried forward, and thus affect the next quarter. Overall, the result is in line with the budget and we reduced the loss according to plan.
During the first quarter, we carried out many successful launches.
Our AI SaaS platform, Collabs, launched as Freemium on February 1st and the high level of interest has so far exceeded our internal forecasts. Among other things, the platform has been adopted by large global fashion houses that have spent significant sums in a short time, which shows good scalability and significant profitability potential.
In recent months, Collabs has expanded its functionality and degree of automation, most recently adding a complete solution for TikTok campaigns, meaning that CUBE was able to successfully launch its TikTok Studio. The CUBE TikTok Studio provides brands with a complete offer within the popular social media app that, in addition to influencer marketing, includes strategy and production of the brands’ own business accounts as well as paid social. A good example of the successful cooperation between our group companies.
Our joint offer in influencer marketing has been well received. For example, we have prolonged our agreement with Storytel, after the end of the quarter, which extended the collaboration to all Nordic markets and we have also signed several new contracts in the million range.
Collabs has also launched a new market offering for affiliate marketing, Collabs Growth, where effective campaigns can be created and executed with a guaranteed return on investment (ROI). The launch was made together with some of the largest and most respected e-commerce brands in the Nordics. Our solid development work has created the opportunity for us to now hold discussions about cooperation with several global retailers regarding our e-commerce solution.
Gigger has also started the year strongly and new customers have been added through the new updated version of Gigger 2.0, which will be reflected in the figures for the second quarter.
I would like to conclude by thanking existing, as well as new, shareholders for the trust they place by participating in the warrant program and the smaller directed new share issue that was completed after the end of the quarter. Through the use of the warrants of series TO3 to subscribe for new shares in addition to the directed new share issue, approximately SEK 3.4 million before transaction costs was added to Syncro’s working capital. At the end of the quarter, we had approximately SEK 12 million in cash and equivalents, which gives us stability to continue realizing our strategic plan.
We see that the interest and demand for our new offers is continuously increasing; something I look forward to with great confidence. After last year’s extensive restructuring of our organization, our processes, and our market offer, we are taking powerful steps towards our vision of becoming a globally scalable and profitable company. I look forward to keeping in touch.