But before that happens, I want to elaborate and summarize a few take-aways from the quarter we just left behind.
As always, Q3 delivered a lot of work, opportunities as well as challenges. In this context, I want to high- light the fact that the overall numbers tell us that we continue to stay on the right track. We can now, in a humble way, refer to our direction as a trend.
Historically, we know Q3 is the weakest quarter of the year. But habit is meant to be broken. So, thanks to a fantastic commitment from the entire company, we managed to do it the other way around. Sales during Q3 was higher than Q2 but also significantly higher than Q3 last year. The gross margin shows
a friendly direction as it continues to climb. In fact, it is now at the highest level ever. Another KPI I like to point out is the fact that the recurring revenue continues to grow. These numbers combined, show us the right response from the challenges we addressed the past year.
This doesn’t mean that we are on the other side of the tunnel. Again, this is not a quick-fix. We need more time before we can communicate steady ground. Moving forward, we need to continue to push ourselves to create more volume and earn our progress every day.
In other words: stay focused, be patient, and continue to be innovative as well as relevant.
Also, as all of you know, this is not a one-man-show; this is the result of teamwork that finds its energy in our core values.
On the business side, the third quarter began in the best of ways. Our exciting journey with Open goes on. Our combined innovation spirit and capability is creating the next generation of point-of-sales (POS) solutions for the Nordic restaurant, arena and event market. The foundation of this long-term agreement is, again, Carbon, our state-of-the-art payment solution based on Android. Our decision and strate- gy to use Android as our primary platform continue to deliver on the numbers. Challenges surrounding the ecosystem of dependencies are now addressed, and our time-to-market is where we expect it to be.
Another well-known customer of Westpay, MAX Burgers, continues its ambition to offer the best customer experience in their business. Great for us at Westpay, since this is when we perform at our best. The frame agreement has a current run-rate of SEK 30 millions over the next three years, although we estimate that the actual revenue during this period can go as high as SEK 50 millions. On top of this, MAX placed an additional order for the next generation Self Service, a.k.a. Express Kiosks. For me, this is a confirmation that we continue to deliver world-class technology. But let us also recognize and give credit to the Westpay team who, day after day, deliver the business value expected so that the customer continues to put their trust in us.
On the partner side, this was a fantastic quarter. I am proud that Westpay and Loomis, the internation- al leader in cash handling, have signed a four-year agreement. The partnership will bring, over time, lots of new opportunities. As always, we need to play the game to get there, but the way we tune together makes me optimistic about our common future.
During the quarter, we completed a share rights issue, which strengthens our ability to continue and develop innovative products in the payment area.
The issue was subscribed to 101% and provided the company with SEK 33.8 million before issue expenses and set-off of loans. It is also pleasing to note that both the board and management show strong confidence in the company’s future by invest- ing further in Westpay.
On the people side of our business, we managed to fill a gap in our line-up. Hans Edin joined as our Chief Marketing Officer boosting our executive management team. Hans comes from a similar role at SecureLink, a leading pan-European cyber- security provider. A key task for Hans will be to ex- pand the awareness and reach of our brand. He will also support and boost the overall pipeline of poten- tial deals and customers. I already see an impact from the background and experience Hans brings regarding marketing, communication, lead manage- ment, and overall business intel. The main focus for Hans now is, together with the organization, to set the scene for 2020.
To even further strengthen our revenue muscle, we hired David Grenthe and Michael Carlqvist. Both of them have proven records as trusted advisors in the fintech industry. Together with their new colleagues at Westpay, they will help customers in their chal- lenge finding the best payment solution.
These deals and activities are just few examples of what we have accomplished during the third quar- ter. Three months to go before we flip the page and enter 2020. The pressure is on, but we are definitely in a better position than the same time last year.
Internally we feel that our hard work is paying off. This gives us the energy to hold on to the strategy and focus on our everyday priorities.
Published oktober 25, 2019