'Benefits of Scalability' Bring Nepa Growth in 2017

Sweden-based research firm Nepa continues its rapid revenue growth, with net sales up 11.4% to SEK 61.4m ($US 7.3m) in Q4, and up 15.6% for the full year, to SEK 213.1m ($US25.5m).

Heavy investment meant a loss of SEK -19.8m (-$US 2.37m) for the full year, although the firm returned to profit (EBIT SEK 0.9m) in Q4. Last year, annual EBIT was positive, just, at SEK 0.5m.

Gross profit was up 18.1% to SEK 47.6m in the fourth quarter and up 15.4% for the full year to SEK 157.9 ($US 18.9m).

CEO Fredrik Östgren (pictured) said the company in 2017 followed the plan that was communicated before the IPO in April 2016, making important steps such as improved scalability through investments in product platform ActionHub; and 'continued growth through investments in our rapidly growing business in the UK, establishing Nepa in the USA, the world's largest market, and continued growth in Sweden, Denmark, Finland, India and Norway'. Östgren says Matt Nitzberg, who joined Nepa USA last month as CCO, Chief Client Officer, will 'broaden the firm's representation in the USA to include offices in New York, New Jersey, Denver, Miami, and Cincinnati'.

Commenting on the high level of investment which has impacted this year's earnings, Östgren said: 'We are now seeing the first results of an increased scalability. While we invested in personnel last year to develop products and enhance sales, the increase in costs decreased each quarter of 2017, from 40 percent in the first quarter to 16 percent in the fourth quarter. At the same time, we show a steadily increased gross profit, surpassing the increase in personnel costs during the fourth quarter and amounted to 18.4 percent - a trend we expect to continue in 2018'.

Headquartered in Stockholm and with local presence in Finland, Norway, Denmark, the UK, the USA, India and Sweden, the company is online at www.nepa.com .