Security

iLOQ Digital Locking Business & 2023 Financials Examined

In this Research Note, we examine the Finnish digital locking company iLOQ. This article is based on the financial statements and the 2023 Annual Report of Capnor Weasel Bidco Oyj, iLOQ’s parent company, and coverage of their activities in the last year. Founded in 2003, iLOQ is a Finnish specialist in the mechatronic locking sector. Based on patented energy harvesting technology, the company has developed self-powered digital locking and NFC-enabled mobile access management solutions that offer electronic locking without batteries or cables.  Its smart locks and keyless solutions provide benefits for building owners, property managers, and end users by maximizing security and minimizing maintenance, administration, and lifecycle costs. They support technologies from various hardware manufacturers and offers cloud integration.  The company operates in more than 55 countries with over 1,800 partner locations globally and more than 320 employees. 2023 iLOQ Financial Highlights iLOQ achieved a 6% increase in 2023 revenue with EUR 141.3 million reported versus EUR 133.0 […]

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In this Research Note, we examine the Finnish digital locking company iLOQ. This article is based on the financial statements and the 2023 Annual Report of Capnor Weasel Bidco Oyj, iLOQ’s parent company, and coverage of their activities in the last year.

Founded in 2003, iLOQ is a Finnish specialist in the mechatronic locking sector. Based on patented energy harvesting technology, the company has developed self-powered digital locking and NFC-enabled mobile access management solutions that offer electronic locking without batteries or cables. 

Its smart locks and keyless solutions provide benefits for building owners, property managers, and end users by maximizing security and minimizing maintenance, administration, and lifecycle costs. They support technologies from various hardware manufacturers and offers cloud integration.  The company operates in more than 55 countries with over 1,800 partner locations globally and more than 320 employees.

2023 iLOQ Financial Highlights

iLOQ achieved a 6% increase in 2023 revenue with EUR 141.3 million reported versus EUR 133.0 million in 2022. The increase in revenue resulted from sales growth mainly outside the Nordic countries, despite a clear decline in new construction and renovation activities particularly in the Nordic countries during the financial year.

The prevailing geopolitical risks associated with Russia's war of aggression on Ukraine and the resulting increase in energy prices as well as the similarly elevated interest rate environment had a negative impact on the construction and renovation markets during 2023.

The management believes, however, that the market's long-term growth potential and drivers remain unchanged, despite the short-term slowdown caused by delayed investments and that it will have a good chance to continue to grow its business even during periods of weaker market activity.

The company also believes that it has succeeded in increasing its market share during 2023, which is also expected to show growth at the outset of 2024.

EBITDA totaled EUR 31.4 million in 2023, no change from the previous year. The operating profit for 2023 reached EUR 20.5 million (EUR 21.9 million in 2022). The development of the company's EBITDA and operating profit were negatively influenced by future international growth investments entered as expenses, most importantly the expansion to the US market.

iLOQ Access Management

Growth Strategy

In accordance with its growth strategy, in 2023, iLOQ continued to strengthen its organization to support its long-term internationalization and growth targets. The most significant investments were focused on strengthening the company’s international sales and marketing as well as product development.

In 2023, they established subsidiaries iLOQ Oceania Pte LTD and iLOQ Middle East FZ-LCC. In addition to these, the iLOQ Group operates subsidiaries in Sweden, Norway, Denmark, Germany, the Netherlands, France, Spain, the United Kingdom, Canada, Poland, the United States and Singapore.

Partnerships

Two partnerships with major access control players were announced in 2023.

In May 2023, iLOQ and Genetec partnered to integrate Genetec’s access control system, Synergis, with iLOQ’s solution to provide operational insights into security and to allow customers to make informed decisions and improve their operations.

In August 2023, iLOQ received LenelS2 factory certification and joined the LenelS2 OpenAccess Alliance Program (OAAP). Their 5 Series access management platform interfaces with the OnGuard access control system to allow secure and convenient daily management of S5 keys and key users.

And in 2024, partnerships with providers of tenant experience apps were explored.

In April 2024, iLOQ announced a product integration partnership with Chainels, a tenant experience operating system. The integration with Chainels eliminates the need to download two separate apps or manage smartphone-based keys through separate software.

In April 2024, iLOQ announced a strategic partnership with Mosino One, a resident engagement and management platform vendor in North America.

iLOQ has experienced a slowdown in revenue growth in 2023 compared to +29% in 2022 and did not reach the double-digit growth targets it set itself.

This article was written by Daphne Tomlinson, Senior Research Associate at Memoori.

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