Chief Executive Officer, Enento Group
Enento Q1'26: Vahva tuloskehitys
Enenton toimitusjohtaja Teppo Paavola kommentoi videolla. Aiheet: 00:00 Aloitus 00:09 Q1:n yhteenveto 00:34 Mitkä tuotteet ...
About Teppo Paavola
Teppo Paavola, CEO of Enento, discussed the company's second-quarter 2026 results in an interview with analyst Roni Peuranheimo. Paavola stated that all segments and countries showed growth, with Sweden performing the strongest. He noted that profit grew faster than revenue, marking the second consecutive quarter where every segment grew. Regarding the EU's CCD2 regulation, Paavola said it will clarify how credit decisions must be made and what data is required, while also bringing lighter-regulated players under stricter rules. He described the regulation as both an opportunity that will grow the market and a risk, as its application in the Nordic countries remains unclear. Paavola added that the regulation is not expected to affect Enento's revenue this year. He also commented that large banks and smaller analytics-focused banks continue to buy Enento's data because it provides a full market view that improves credit risk predictability.
Transcript (24 segments)
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Interviewer0:00
Enento published its first quarter results today, and I have the company's CEO Teppo Paavola in the interview. Welcome to the interview, Teppo.
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Teppo Paavola0:08
Thank you.
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Interviewer0:09
How would you summarize Enento's first quarter?
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Teppo Paavola0:13
A good start to the year. And it was great to see that growth was in all areas. Perhaps the biggest joy comes from Sweden, because Sweden had been declining for several years and now it grew for the first time. A pretty good start.
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Interviewer0:34
Yes. If we dig deeper, if we think about products, which products are selling best right now and where is it stickier?
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Teppo Paavola0:42
Well, these are in many areas. In Sweden, actually we can start from the smallest, Norway, Denmark, there the change was from premium to premium, in other words, higher value-added data, which is then often sold more on a subscription basis, and that is good. And in Sweden also key areas were Business Information and especially our SME transformation, which we have been talking about for a long time, looks good. It particularly affects profitability because it has a different business model. In Finland, then, improvement in consumer information sales. Those are perhaps the key ones.
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Interviewer1:54
Yes, we'll get to that in a moment. Your revenue growth was encouraging, so do you think there is a permanent change in the demand outlook for the better, or was there some one-time good in this?
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Teppo Paavola2:07
It was not a one-time cause. The underlying demand and volume demand, which of course is related to borrowing demand, has been a bit stickier in Finland. And the improvements are largely due to our own measures. That might be a generalization.
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Interviewer2:41
Yes. Now if we think about profitability, in which segments do you think there is the most potential to improve?
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Teppo Paavola2:50
Well, in Sweden, this is the first time we report by country, which shows how big the differences are in this business model. In Finland, data costs are more variable, and in Sweden more fixed, and of course in that sense, volume increases or decreases in Sweden have a greater impact on the bottom line. And that is perhaps a key issue overall. And then in Finland, revenue is distributed more evenly across product groups than in Sweden, so again the impact of individual items is perhaps larger in Sweden, up and down, hopefully more up.
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Interviewer3:48
Yes, you have renewed your organizational structure and management team. What changes compared to the old, and what are the justifications for this?
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Teppo Paavola3:57
Well, the change is big. Previously, business areas had profit responsibility. Business areas were across the company, across all countries, especially over Finland and Sweden. And now that we are country-specific, it is reflected in this reporting, but in practical terms it means we are closer to the customer and it is clearer who is responsible for what. Even in the old organization, there was some country-specific organization under different functions. The fact that previously profit responsibility was on the business area, business area is a bit like a product area, and now we have one product organization that does not have profit responsibility. Of course, there is a strong intention to do profitable operations, but profit responsibility lies with the countries. So overall, what we are primarily looking for is clear responsibilities and thus faster, more customer-oriented operations.
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Interviewer5:21
Yes. You have been part of Enento for almost 10 years. Are there still significant synergies available, and why haven't they been pursued earlier?
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Teppo Paavola5:31
Well, it might be wrong to say that they haven't come at all along the way. With these regulatory changes, the volume declines that have come, precisely because of what I just said about a very large part of costs, especially data acquisition costs being fixed, then when volumes have gone down, it has a massive impact on the result. We run the business with significantly fewer people than before, and also the cost level is clearly lower. So benefits have been obtained from this operating model. That doesn't mean more couldn't be available. What slows it down is that our IT environment is different in Sweden and Finland, so with few exceptions, things have often had to be done country-specifically, and that leads to costs in many places, primarily in IT but also elsewhere. This is something we aim to develop over time.
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Interviewer6:54
I see. We'll follow that. You published country-specific profitability for the first time. Finland was, as expected, the most profitable, but what do you want to communicate to investors with this?
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Teppo Paavola7:05
Well, we report according to our organization, and of course, what is inside the company, what kind of operations and accountability we want for these countries, this is what we also show externally. There is no bigger message than that; it is based on our organizational model.
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Interviewer7:35
Yes. You also announced quite significant change negotiations relative to the group's total size. Are you looking more for efficiency, or does it indicate weakness in the demand outlook?
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Teppo Paavola7:47
It doesn't say anything about the demand outlook, up or down. It is all about simplification. The old model was more complex, and now we are in a simpler model. That is primarily where it comes from.
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Interviewer8:08
Yes. AI has been a big narrative in recent months, and it has also been used to justify many of these change negotiations. So what does AI mean for Enento? AI means a lot, but it is not related to these change negotiations.
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Teppo Paavola8:25
Of course, it is related to the organization. We are constantly thinking about what kind of competence we need to stay ahead. And then AI affects the business itself in that, of course, it is a lot in all different data, especially unstructured data, in its processing, productization, and efficiency. It is in many areas, but it is not behind these changes.
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Interviewer9:11
Yes. Let's take one last question. About demand outlook. The Iran war has raised interest rates, so does this have an impact on Enento's business demand outlook? If you think about the Finnish economy, it's stagnating as always. But in Sweden, economic growth is forecast. What comments on this?
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Teppo Paavola9:29
Well, we of course hope for growth. And economic growth is related to, among other things, growth in lending, which then affects our volumes. So macro always matters. Economic development always matters. Whether we can say what it looks like even by midsummer, we can't any better than anyone else. So we go in both directions, and we focus on the things we can influence and hope for the best for each country's economy.
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Interviewer10:09
Thank you very much for the comprehensive answers, and good luck for the rest of the year.
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Teppo Paavola10:12
Thank you.