Pliezhausen, 24 August 2023. DATAGROUP SE (WKN A0JC8S) today publishes the results for the third quarter of the current fiscal year. The IT service provider continues to deliver successful business performance and feels vindicated in focusing on the profitable core business with CORBOX IT services.

Revenues were EUR 123.9m in the third quarter, EBITDA amounted to EUR 20.2m and EBIT to EUR 11.5m. In the nine-month period, revenues totaled EUR 375.0m. Operating earnings before taxes, interest, depreciation and amortization (EBITDA) were up 2.2 % after 9 months to EUR 59.6m (PY: EUR 58.3m). Earnings before interest and taxes (EBIT) increased by 7.4 % to EUR 34.3m (PY: EUR 31.9m). Earnings per share (EPS) were EUR 2.56, corresponding to an increase of 9.8 % compared to the prior-year period (EUR 2.33). The EBITDA margin improved to 15.9 % after nine months compared to 15.6 %; the EBIT margin rose significantly to 9.1 % compared to 8.6 % in the comparable period a year earlier.

Three major effects have driven the sales development in the first nine months of the fiscal year: Firstly, the Covid-19-related exceptional boom came to a premature end. The vaccination centers, for instance, closed earlier than anticipated at the beginning of the fiscal year which also meant an earlier end to the IT services provided by DATAGROUP. Secondly, existing contracts from earlier acquisitions, which were operated at a lower profitability outside the CORBOX core business, were reduced prematurely. Thirdly, a change of the accounting treatment concerning the license business resulted in a reduction of revenues pursuant to IFRS 15 (principal agent). These aspects have led to negative revenue effects of some EUR 40m on an annual basis in total, which were fully compensated for by growth in the CORBOX core business and the Solutions business. In a historical comparison, however, this increase in revenues of 0.6% to EUR 375.0m is lower than in the comparable prior-year period. When considering the fourth quarter, these effects will probably not be fully compensated for by growth in the current fiscal year. For this reason, DATAGROUP adjusts its sales guidance for the current fiscal year to a range of EUR 485 – 500m. The initial guidance was EUR 520 – 540m.

“That said, this lateral movement in revenues is offset by a significant boost in our earnings. An EBIT increase of 7.4 % in the first three quarters over the same period a year earlier is evidence of the profitability of the CORBOX business. We therefore reiterate our EBIT guidance of EUR 45 – 48m for the current fiscal year”, explains Oliver Thome, CFO of DATAGROUP.

Balance Sheet Development and Cash Flow

The balance sheet total has increased only minimally in this fiscal year from EUR 483.6m on 30 September 2022 to EUR 483.8m on 30 June 2023. At the same time, equity has significantly improved to EUR 142.0m compared to EUR 127.5m on the same date a year earlier. This has improved the equity ratio to 29.4 % in comparison to 26.4 % in the previous year. Net debt amounted to EUR 118.3m in comparison to EUR 109.3m in the previous year. Accordingly, the net debt to EBITDA ratio is 1.49. Cash and cash equivalents stood at EUR 34.3m at the end of the reporting period (PY: EUR 47.0m).

The cash flow development remains very stable: Cash inflow from operating activities was EUR 33.4m on 30 June 2023.

Investments in Future Capacity for Growth: AI, Cybersecurity and Cloud

DATAGROUP continues to significantly expand its own expertise in AI, security and cloud to maintain the future capacity for growth and to secure competitive advantages.

Artificial intelligence will be used in IT service production in the future and thus will be an efficiency lever as well as an important response to addressing the growing skills shortage. Furthermore, DATAGROUP continuously develops its Security Services with new technologies to minimize the growing risks for the customers’ digitization caused by cyber-attacks. With the CORBOX cloud DATAGROUP offers its customers a strongly growing, independent “German” cloud platform, which provides data sovereignty, meets the highest data protection requirements, and can be flexibly adapted to the needs of the customers.

“We are equipping ourselves today to ensure future growth. It is essential to have good delivery capacity from a base in Germany to remain a reliable partner for our mid-market customers and public authorities. In this context, it is important to be able to scale independently of the skills shortage and to provide services at a high security level using our own sovereign cloud capacities. Customers need to be able to rely upon their service providers and want to ensure data sovereignty. These aspects will be a decisive factor of success to continue to grow, and we invest in these skills in a targeted and sustainable way”, explains Andreas Baresel, CEO of DATAGROUP SE.

CEO Andreas Baresel and CFO Oliver Thome will explain the results of the first three quarters of the current fiscal year in an online conference on 24 August 2023 at 10.00 am CET. All interested investors, analysts, and journalists are cordially invited. You can register for the conference call under the following link: https://attendee.gotowebinar.com/register/2684974839733554774

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