BUY MINTRA

Mintra is a leading provider of workforce management systems for safety.

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Mintra IPO was placed in late September at 2020 at 9.70 NOK per share. The IPO had a very strong interest and at the last moment the IPO size increased significantly. The last minute change in IPO size scared investors and the IPO sold off on launch. It was a filed IPO. The share price settled around 7 NOK and has been around there since.

The company is guiding increase in EBITDA margins from current 30% to 40% in medium term. The company is growing both organically and through acquisitions.

Mintra today announce its Q4. Numbers were as expected. Pareto and Sparebank has price targets between 9-10 NOKs. Below is a summary of SpareBank research:

Mintra is a mission critical and leading global partner delivering a scalable and proprietary workforce management system and
eLearning portal for safety critical industries with an impressive blue-chip customer base with low churn…

» Sticky service offering with low single digit churn.
» Demonstrated business model with +30% EBITDA (2020) margin and gross margins to increase with business mix. Guides +40% EBITDA margin medium-term
• …perfectly positioned with ~80% of revenues in a huge and attractive end market with forecasted double-digit growth…
» Global e-learning market at USD200bn, where the corporate vertical is expected to grow +10% until 2026 driven by low-single digit global penetration, but where
growth currently is affected by Covid-19.
» Human Capital Management (HCM) software market expected to growth +20%
• …and where SaaS revenue characteristics, high-end niches and global organization lay the foundation for continued double-digit,
profitable and favourable organic revenue growth…

» Mintra can point to 14% organic revenue CAGR last 10 years, with Covid-19 temporarily negatively affecting eLearning (~46% of revenues)
» Vertical agnostic platform and software (energy, maritime and other industries) with high-growth niches position the company for in line market growth
» Increasing share of recurring revenue in the mix
• …which is fuelled with a accretive “buy-and-build” strategy where a fragmented market and concrete M&A pipeline offer ample
opportunities to leverage current set up for customer acquisitions…

» Concrete M&A pipeline with concrete model for how to conduct and extract synergies
» Multiple arbitrage, new industries, new regions
• …and coupled with strong cash conversion, this position MNTR with several levers for scalability
» +30% EBITDA margin and 25% OpFCF margin (i.e. scalable customer base expansion with customer vertical agnostic platform)
» Low churn with potential for price hikes, industrialization of legacy systems, up-sell/volume increase from existing customers increasing use cases (operational scalability)
» Scale the platform/technology vertically (vertical agnostic) and scale on cash flow (capex does not scale with revenues with capitalized R&D)

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