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5.9% capital increase to finance growth; confirm BUY
Capital increase with subscription rights. Circus announced a capital increase with subscription rights of 1.33m shares, or c. 5.9% of the current share capital, at a price of EUR 16.00 per share, potentially leading to gross proceeds of EUR 21.3m. Existing shareholder of Circus holding c. 78.6% of the share capital have refrained from exercising their subscription rights and the corresponding 1.0m shares have already been sold in a preplacement to the newly appointed Co-CEO Claus Holst-Gydesen and other existing and new shareholders, including high-profile institutional investors and family offices from Europe and the U.S. Thus, gross proceeds of EUR 16m have already been secured. The subscription period for the remaining shares is expected to take place in April 2025.
Financing growth. The majority of the proceeds from the capital increase will be used to finance the ambitious growth that is on the horizon. This week, Circus signed a framework agreement with Mangal, a fast-growing food franchise chain, for the roll-out of 500 CA-1 robotic units, which could generate up to approximately EUR 100m in equipment sales and up to EUR 70m in annual recurring SaaS revenues. The first locations are expected to open in autumn 2025. In time for the launch, Circus recently announced the successful completion of its high-volume manufacturing facility in China, operated by its contract manufacturing partner Celestica. Production is expected to commence in May. We estimate that the proceeds from the rights issue should be sufficient to fund liquidity needs until early 2026, and we expect Circus to become cash generative in 2027.
Confirm BUY. The capital increase paves the way for the next step in the commercialization of the CA-1 and the beginning of its expansion into a global business. If fully placed, the dilutive effect will bring our fair value from the current EUR 75.00 per share to EUR 72.20 per share, which still represents a highly attractive value proposition for investors. The recent high-profile additions to Circus, including former Adidas and Henkel CEO Kasper Rørsted as a member of the Board of Advisors, reinforce our confidence in Circus' ability to disrupt the global foodservice industry. We reiterate our BUY recommendation with a target price of EUR 75.00. We will include the capital increase in our model once the transaction is closed.
Previous Updates
Key Figures
Investment Case
The robot chef. Circus is revolutionizing the food service industry with its cutting-edge autonomous robotic kitchen, the Circus Autonomy One (CA-1). Imagine a fully automated kitchen capable of preparing up to 120 dishes per hour, including soups, stir fries with noodles or rice, pasta dishes, curries, stews, porridges or scrambled eggs. The CA-1 integrates all essential kitchen appliances—induction stoves, refrigeration, and dishwashing—within a compact modular unit. Beyond hardware, Circus has developed a proprietary AI based software, CircusAI, which offers demand forecasting, recipe creation, quality control and an AI agent user interface.
An early mover advantage. Circus has finetuned the CA-1 with EUR 40m investment in R&D since 2021. As an early mover, the company has a head start in real-world testing, with more than 1m meals already sold. Circus’s razor-blade model ensures a growing share of recurring revenue from high-margin SaaS fees.
The supply is the limit. Circus is poised for explosive growth, offering significant cost savings in the food service industry, which is plagued by low profitability, rising labor costs and a tight labor market. With a market opportunity spanning corporate canteens, franchise restaurants, elderly care, hospitals, universities, hotels, airports, supermarkets and more, the company estimates a potential of over 80m global locations for its product. Early traction is evidenced by pre-orders for 8,400 CA-1 units, worth EUR 1.8bn in equipment sales alone, including agreements with well-known players such as Strabag and IHG. As potential customers are queuing up, growth over the next years seems determined not by almost limitless demand, but by the capacity ramp-up in partnership with a multinational contract manufacturer, expected to reach 6,000 systems in the mid-term. CEO and largest individual shareholder Nikolas Bullwinkel has proven his ability to blitz-scale in his former role as co-founder of Flink, growing the business into a unicorn within 12 months.
Investment case in Charts
SWOT-Analysis
- founder / CEO with successful track record in blitz-scaling
- early mover with a lead over potential competitors
- lean and scalable business model
- razor-blade model with increasing share of recurring revenues
- patent protected product with development costs in excess of EUR 40m
- stock market listing with access to additional capital
Valuation
Financials
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