Øivind Horpestad presents the q2 results
7. September 2021

Significant market progress | Q2/H1 2021 financial results

7 September 2021 – Elop Technology entered into several potential high-value strategic industry partnerships during the second quarter and proved its technology with leading industry players. The first batch of ultrasound scanners is being assembled inhouse for delivery in October, and first sales orders have been finalized. Simplifai breaks into growth sectors such as insurance and public sector and wins important contracts resulting in contracted monthly recurring revenue growth of 82 percent year on year.

Strategic industrial partnerships agreed 

In Q1, Elop announced that the company was in dialogue with several potential industry partners looking at ways to integrate Elop’s technology into existing service offerings for inspection and monitoring of concrete infrastructure. During Q2 several such partnerships have been agreed. 

Elop AS and DEKRA Visatec GmbH, part of the global providers of industrial inspection services for infrastructure DEKRA, signed an LOI on entering into a commercial agreement to create a better and more efficient way of inspecting large concrete infrastructure with ultrasound. The DEKRA group has a workforce of around 44,000 people working in approximately 60 countries on six continents and is the world’s largest unlisted expert organisation in the TIC (testing, inspection, certification) industry. The partnership with DEKRA Visatec and the development of a crawler solution is progressing according to plan. Successful tests of the crawler prototype have been conducted in collaboration with DEKRA Visatec and Elop Technology’s robotics partner ICM. Elop Technology has signed a strategic cooperation agreement with Terratec AS, a Nordic provider of survey and inspection services, regarding the commercial use of Elop’s technology in combination with Terratec’s services.  

“Not only does partnerships with renowned industry players help to verify the functionality and value of our technology, but they are also gateways to significant sales volumes for Elop. It is a highly cost-effective way of securing industry approval of our ultrasound technology, and we look forward to harvesting the effects in the years to come,” says Øivind Horpestad, CEO and chairman of Elop. 

Further, in June Elop Technology entered a research and development collaboration with the Norwegian Public Roads Administration for the development of Elop Technology’s Asset Management System (AMS). The system Elop Technology creates will contribute to more efficient and better quality of management of bridges.  

Successful Elop Insight field tests 

During Q2 2021, Elop Technology has together with industrial partners conducted several field tests to verify that the ultrasound technology can deliver the needs owners of large and critical infrastructure have in order to meet safety and environmental regulations as well as ensure optimised operations. These tests include successful field testing with major owners of large concrete structures including Veidekke, Equinor and Aker Solutions.   

“Our field tests have been performed together with international companies that must adhere to the highest quality and safety standards everywhere they operate. Choosing to field test our technology together with the most demanding customers first reflects our belief in our solutions. I am proud to say that the results from the field tests match our own very high ambitions, says Øivind Horpestad. 

Covid-19 restrictions continue to make physical sales demonstrations of Elop’s technology difficult. However, as some restrictions were lifted during Q2 the company was able to conduct selected field tests in Europe. 

Strategically important agreements for Simplifai opening new markets and sectors 

Simplifai signed contracts and strategically significant agreements during the second quarter breaking into both insurance and public sector.  

In April the company entered into a strategic partnership agreement with rapidly growing document management company Documaster AS. The partnership has already signed with two Norwegian municipalities and is part of Simplifai’s public sector growth strategy. In June Simplifai entered a licensing partnership with Crayon Norway, giving Simplifai access to a broad list of Nordic customers. Also, in June the company entered into a partnership agreement with Dutch specialist of information management and consultation of digital information to local governments across The Netherlands. 

Simplifai is experiencing a high demand for AI-based automation solutions from players in the insurance sector and signed contracts with EIKA Insurance and Knif Trygghet Forsikring AS during the second quarter.   

Year-on-year growth in contracted MRR is 82% percent from Q2 2020.  

Outlook 

Elop Technology’s ultrasound technology is expected to continue to attract market interest and Elop expect to close additional sales orders for its ultrasound scanner during Q3 2021. However, Covid-19 restrictions may continue to impact Elop’s ability to perform live demonstrations. Simplifai targets three to five times contracted MRR at year end 2021 vs year end 2020.  

Based on the progress made in Q2 2021, Elop retains its ambition of creating a NOK 1 billion revenue company in 2025. 

Q2 and H1 2021 results 

Elop Group operating revenues of NOK 2.0 million in in Q2 2021, versus NOK 0 million in the same quarter last year. For the half-year, Elop delivered revenues of NOK 4.2 million, compared to NOK 0.0 million in the same period 2020.  

EBIT of NOK – 18.5 million in Q2 2021 versus NOK -6.2 million in the same quarter last year.  In H1 2021, Elop’s EBIT was NOK -38.9 million, versus NOK -13.4 million in the same period last year.  

Elop held cash and cash equivalents of NOK 81 million at end of Q2 2021.  

Live webcast presentation at 08:30 CET 

Elop AS invites to a live company update today at 08:30 (CET). Investors, analysts and media are invited to FOLLOW THE WEBCAST HERE  

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