Proact It Group Ab · OMXSTO:PACT
Proact It Group Ab — Q3 2020 Earnings Presentation
24 slides from Proact It Group Ab's earnings presentation, Oct 23, 2020
Slide 1: Summary Q3 2020
Summary Q3 2020 23 October, 2020 Jonas Hasselberg CEO and President [email protected] Linda Höljö CFO www.proact.eu [email protected]
Slide 2: Agenda
Agenda • Proact introduction • Quarter in brief • Key developments • Financial results • Summary Jonas Hasselberg Linda Höljö CEO and President CFO
Slide 3: Who is Proact
Who is Proact FI NO 1994 Almost 3 decades of pushing the limits of SE technology while delivering business agility EE LV DK LT 3,500 Medium and large enterprise UK NL customers across Europe BE DE CZ SK 350 Million euro turnover with stable finances. Listed on Nasdaq Stockholm since 1999 1,000 Emplo
Slide 4: The long-term CIO agenda
The long-term CIO agenda Generate business value and enable innovation Increase flexibility, speed and availability Integrate a true multicloud environment Ensure cost-efficiency Drive technical harmonisation & modernisation Ensure data security and compliance
Slide 5: The CIO agenda during Corona pandemic
The CIO agenda during Corona pandemic New strains on IT due to remote working Need for accelerated digitalisation New security threats Enabling modern workspace
Slide 6: Meeting our customers needs
Meeting our customers needs Data management specialist helping our customers store, connect, protect, secure and enable them to drive value through data
Slide 7: Quarter in brief – best ever Q3 for Proact
Quarter in brief – best ever Q3 for Proact + Revenue up 17% to 821 (701) MSEK – Total contract value of 61 (87) MSEK + Adj EBITA up 46% to 54 (37) MSEK – Covid-19 uncertainties + Improved EBITA margin to 6.6% (5.3%) + 43% up in Cloud revenue + 22% growth of Services + Proposed dividend of 2.50 SEK /
Slide 8: Key developments in Q3
Key developments in Q3 • Reinforced our market position and new website • Continued customer expansion including NHS Blood & Transplant • Improved portfolio & capabilities including Elite partner with Nvidia on AI virtualisation • Improving customer experience including implementation of ServiceNow
Slide 9: Acquisition of Cetus Solutions Ltd. – About and strategic fit
Acquisition of Cetus Solutions Ltd. • Founded in 2001 • 50 employees in Manchester and London About • Strong capabilities in cloud and modern workspace • Strong partnership with Citrix, Microsoft, VMware, NetApp and Dell Technologies • Strong within medium and enterprise segment • Similar values and
Slide 10: Acquisition of Cetus Solutions Ltd. – Financials
Acquisition of Cetus Solutions Ltd. • Purchase price: 7.7 MGBP cash-free, debt-free • Yearly revenue: 13 MGBP Financials • Multiple: 8x EBITA (FY2020) • EBITA margin: ~7%
Slide 11: Financial development
Financial development
Slide 12: Income Statement – Highlights Q3 2020
Income Statement – Highlights Q3 2020 TOTAL REVENUE SYSTEM SALES SERVICES SALES GROWTH MSEK GROWTH MSEK GROWTH MSEK 17% 821 14% 473 22% 348 Adj. EBITA Adj. PROFIT BEFORE TAX GROWTH MSEK % GROWTH MSEK % 46% 54.1 6.6% 45% 43.4 5.3%
Slide 13: Revenue development
Revenue development Key developments in the third quarter • Revenue growth 17% • 7% organically • R12 months growth of 8% (25% in services) • Services growth 22% • 1% organically • Key driver: Peopleware acquisition • Systems growth 14% • 11% organically • Strong growth in UK • Cloud revenue growth
Slide 14: Profitability development
Profitability development Key developments in the third quarter • Adjusted EBITA of 54.1 MSEK (36.9) • Margin of 6.6% (5.3%) • Growth of 46% • Gross margin declining from • Dilution from Peopleware • Some larger systems deals with lower gross margins • SG&A costs reducing by 12% for comparable units
Slide 15: BU Nordics
BU Nordics Key developments in the third quarter • Revenue growth 2% • Systems 2% • Services 3% • Sweden main growth driver • EBITA margin increasing to 8.1% (6.6%) • EBITA of SEK 29.7 (23.5) million • Reduced SG&A costs of 8%
Slide 16: BU UK
BU UK Key developments in the third quarter • Revenue growth 32% • Systems 91% • Services -11% • NHS Blood and Transplant deal contributing to high systems growth • EBITA margin decreasing to 5.5% (6.2%) • EBITA of SEK 9.7 (8.3) million • Reduced SG&A costs of 6%
Slide 17: BU West
BU West Key developments in the third quarter • Revenue growth 38% • Organic growth -4% • Systems -1% • Services 80% • Covid-19 impacting organic growth • EBITA margin increasing to 4.2% (2.9%) • EBITA of SEK 10.3 (5.2) million • Reduced SG&A costs of 11% for comparable units • Previously implemente
Slide 18: BU East
BU East Key developments in the third quarter • Revenue growth 16% • Systems 28% • Services 1% • EBITA margin increasing to 11.1% (8.4%) • EBITA of SEK 4.9 (3.2) million • Reduced SG&A costs of 9%
Slide 19: Cash flow in Q3
Cash flow in Q3 Liquid Funds June 30, 2020 389 • Positive cash-flow from current operations Cash-flow from current operations 54 • Negative change in working capital after a very Current operations 97 strong Q2 Change in working capital -43 • Fixed assets; Proact Finance -8 MSEK Cash-flow from inves
Slide 20: Cash flow January-September 2020
Cash flow January-September 2020 Liquid Funds December 31, 2019 373 • Negative change in working capital -69 Cash-flow from current operations 202 MSEK; +59 MSEK on 12 months rolling Current operations 271 • Fixed assets; Proact Finance -36 MSEK Change in working capital -69 • Repayment of Leasing L
Slide 21: Balance sheet
Balance sheet 2020 2019 2019 • Equity ratio of 22% (MSEK) Sep 30 Dec 31 Sep 30 • Cash position of 396 MSEK Total Assets 2,788 2,877 2,251 whereof Goodwill 511 516 410 • Net debt of 92 MSEK, improved since end whereof Intangible fixed assets 71 93 55 of Dec 2019 whereof Accounts receivables 502 613 3
Slide 22: Financial goals
SALES GROWTH FINANCIAL TARGET OUTCOME 3,642 MSEK GOALS >10% 8% Rolling 12 months EBITA MARGIN TARGET OUTCOME* Adjusted for one-time costs 8% 5.5% NET DEBT/EBITDA TARGET OUTCOME IFRS16 impacting negatively <2 0.27 ROCE TARGET OUTCOME Impacted by IFRS 16 and acquisitions >25% 16.1% DIVIDEND TARGET OUT
Slide 23: Summary
Summary • Record sales and results in a Q3 • Successful acquisition of Cetus Solutions Ltd. • Continued demand for data-driven digital transformation and mission-critical solutions • Development of pandemic remains uncertain
Slide 24: Thank you
PROACT Thank you www.proact.eu in@ fiv