• Spain's largest grocery retailer commits to StrongPoint
• Large market potential - EUR 250m in spain alone
• Much needed deal - earnings impact likely from H1'25

Spain's largest grocery retailer commits to StrongPoint

StrongPoint has today announced that Spain's largest retailer, Mercadona, has tested its new CashGuard system, CashGuard Connect, and it is fully operational in one of its stores. Mercadona has more than 1,660 supermarkets in Spain and Portugal. According to IR, Mercadona has committed to StrongPoint's solution, and is planning to implement it in more stores going forward. Note that revenues from Mercadona will be negligible in '24, and a larger part will come in H1'25, gradually ramping up throughout '26-'28.

Large market potential - EUR 250m in Spain alone

StrongPoint cannot provide figures on how many systems Mercadona will purchase, but it is fair to assume that the potential is big considering it has more than 1,660 stores. We estimate that full implementation in Mercadona would translate to NOK 750-800m in revenue to StrongPoint (Mercadona has ~27% market share in Spain). StrongPoint also mentioned that CashGuard Connect is set to be made available to other grocery retailers by the end of '25. The company estimates that the total market potential for its solution is >EUR 250m in Spain alone.

The front and back-end elements of the solution can be sold separately or installed as a complete end-to-end solution, depending on the needs of the store and its infrastructure.

Much needed - earnings impact likely from H1'25

The market has been challenging with retailers postponing investments due to high interest rates and inflationary pressure. However, the Mercadona deal provides reassurance that StrongPoint manages to stay relevant in an increasingly challenging macro environment.