Tecnotree

Tecnotree's Q3 figures were clearly below our expectations, but the earnings disappointment was partly explained by provisions made for trade receivables.

We expect the company's revenue to have grown significantly from a rather subdued comparison period, although the weakening dollar creates a headwind for growth. We expect a clear year-on-year improvement in earnings.

Tecnotree's Q2 figures fell short of our estimates, but this was largely due to the weakening US dollar. The order book grew thanks to major contract wins, and, quite as expected, the upper end of the growth guidance was increased, which we had already taken into account in our forecasts.

Tecnotree will publish its Q2 report on Tuesday at around 9.00 am EEST. We expect the company's growth rate to have accelerated and earnings improved significantly from the comparison period. The company has recently had strong sales momentum, but we expect these deals to translate into clearer growth later this year and next year. This is also supported by the company having kept its guidance unchanged.

The agreement seems to continue largely as before and therefore will not drive growth. MTN Group is one of Tecnotree's key customers, and in that sense, we believe the contract extension is an important sign of confidence.

Tecnotree announced yesterday that it had signed a continuation agreement with an existing Tier 1 telecom operator in the Middle East. The agreement supports revenue, but in our understanding, it is a continuation agreement, and thus it does not drive growth.