Exclusive Networks’ expectation-busting full-year 2023 results show its model is scalable, its CEO asserted.
The Paris-based VAD this morning unveiled annual numbers showing a 14% rise in both net profits and gross sales to €468m and €5.15bn, respectively.
The news comes as Exclusive prepares to greet Dell UK channel boss Rob Tomlin as its new UK& leader.
“What 2023 really shows is that our model is scalable,” Exclusive Networks CEO Jesper Trolle said on the earnings call, as he noted that all financials topped its outlook.
Exclusive’s serviceable addressable market has almost doubled from $26bn to $50bn since it floated on the Euronext Paris in 2021 (see below), Trolle said. But Exclusive has grown even faster, he added, with gross sales almost doubling in its last three years.
Exclusive’s top line growth has decelerated in recent quarters, hitting 9% in the final quarter of 2023 (compared with 38% growth for full-year 2022), however.
The distributor forecast that 2024 net sales will rise by between 10-12% in constant currency – roughly in line with general market estimates from the likes of Canalys and Morgan & Stanley.
“We saw a lengthening of the sales cycle and greater scrutiny of budgets, so I’m even more proud of our team’s performance given this challenging economic backdrop,” Trolle said. The market is set to remain “soft” in the first half, the CEO added in prepared remarks.
Vendor and customer “stickiness”
Exclusive has enjoyed gross sales CAGR of 31% over the last 10 years, making 20 acquisitions over that period. It has a 1:2 ratio of engineers to sales resources, Trolle said on the call.
Exclusive’s vendor and customer retention rates, which stood at a respective 113% and 112% in 2023, show the majority of its growth is derived from its existing vendors and customers, Trolle said. “This is resulting from our strong relationships and the stickiness of the model,” he said.
Although the $20bn network security market – where Exclusive works with the likes of Palo Alto Networks and Fortinet – remains a “strategic priority” for the distributor, Trolle singled out endpoint security vendor SentinelOne for the most praise. Exclusive’s endpoint security business grew 25% last year, compared with 9% for the overall market, he said.
Exclusive’s share price is up around 6% today on the results.
