EQS-News: adesso sales up 26 % to more than EUR 1.1 billion in 2023 / EBITDA of EUR 80.0 million hits middle of the guided range / Growth expectations for 2024 with improved profitability / Dividend increase

adesso sales up 26 % to more than EUR 1.1 billion in 2023 / EBITDA of EUR 80.0 million hits middle of the guided range / Growth expectations for 2024 with improved profitability / Dividend increase

* Sales increase by 26 % to EUR 1,136 million in 2023

* EBITDA of EUR 80 million in the middle of the forecasted corridor, which was lowered during the year

* EBITDA margin improves significantly to 9.3 % in the second half of 2023 (H1 2023: 4.6 %)

* Proposed dividend increase to EUR 0.70 per share

* Growth forecast for 2024: more than EUR 1.25 billion in sales and EUR 110 to 130 million in EBITDA

Based on preliminary figures for the 2023 financial year, adesso Group increased sales by 26 % year-on-year to EUR 1,136 million (previous year: EUR 900.3 million). EBITDA of EUR 80.0 million was achieved (previous year: EUR 92.9 million). adesso has thus met its annual forecast for 2023, which was adjusted with the nine-month figures. The fourth quarter of 2023 also confirms the positive profitability trend with growth in sales and operating earnings of 23 % each compared to the same quarter of the previous year. As forecasted and despite a strong improvement in the second half of the year, the weakness in capacity utilisation, which weighed on the EBITDA margin in the first half of the year in particular, could not be compensated over the year as a whole. In addition, licence sales were weaker than expected compared to the record year 2022. The introduction of a new ERP system and additional expenses from two fixed-price projects also had a negative impact on the operating result. At EUR 80.0 million, EBITDA reached the middle of the lowered forecast corridor. Constant, non-deductible tax expenses have a greater impact on the lower earnings before taxes compared to the previous year as a result of higher depreciation, amortisation and interest payments. After deduction of taxes, consolidated net income totalled EUR 3.4 million (previous year: EUR 28.8 million). Earnings per share are calculated at EUR 0.49 (previous year: EUR 4.40).

In the last quarter of the year, sales increased to a new record level of EUR 302.2 million compared to the previous year and the previous quarter. EBITDA improved by 23% to EUR 26.5 million compared to the previous year. This corresponds to an EBITDA margin of 8.8%.

The Executive Board believes that the weaker net consolidated profit in 2023 and the reduction in the net cash position are due to the special situations in 2023. The introduction of the ERP system is already contributing to a noticeable improvement in working capital management. The increase in working capital in 2023 is only 6 % (previous year: 36 %) and was therefore significantly lower than sales growth in 2023. This resulted in a significantly improved net debt situation of EUR -48.3 million at the end of the year compared to the first nine months of 2023 and a significant improvement in free cash flow development. On this basis, the Executive Board is therefore continuing the dividend policy of recent years unchanged. Hence, the Executive Board is proposing an increased dividend of EUR 0.70 per share for the 2023 financial year (previous year: EUR 0.65).

Despite the difficult overall economic situation, the Executive Board is positive about the further growth prospects for the IT sector and, in particular, for the adesso Group in line with the continuing demand for digitalisation. A double-digit growth rate is expected for sales again in 2024. Accordingly, sales are expected to increase to more than EUR 1.25 billion with improved profitability leading to a higher EBITDA of EUR 110 to 130 million.

This estimate is based on the findings to date from the preparation of the consolidated financial statements. Explanations of the key figures used are published on the company's website at www.adesso-group.de/en/apm/ The complete audited consolidated financial statements for 2023 will be published as planned on 25 March 2024.