Proact It Group Ab · OMXSTO:PACT
Proact It Group Ab — Q2 2022 Earnings Presentation
26 slides from Proact It Group Ab's earnings presentation, Jul 14, 2022
Slide 1: Summary Q2 2022
Summary Q2 2022 July 14, 2022 Jonas Hasselberg CEO and President [email protected] Linda Höljö CFO www.proact.eu [email protected]
Slide 2: Agenda
Agenda • Proact introduction • Proact’s market • 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 helping customers drive SE business value and growth – through IT EE LV DK LT 4,000 Medium and large enterprise UK NL customers across Europe BE DE CZ 4,000 Million SEK turnover with stable finances. Listed on Nasdaq Stockholm since 1999 1,200 Employees w
Slide 4: Businesses across all industries are in state of transformation
Businesses across all industries are in "state of transformation”. Data is the key to this transformation. The three defining trends in the market - Focus on digital transformation and business innovation through IT - Increase speed, flexibility and availability through multicloud - Ensure cyber sec
Slide 5: Value to customers via our propositions
Value to customers via our propositions
Slide 6: Our multi-cloud model enable delivery to you anywhere
Private Public Managed Our multi-cloud model enable delivery to you anywhere On-premises infrastructure
Slide 7: Quarter 2 in brief
Quarter 2 in brief + 31% Revenue growth, 21% organic – Gross margin pressure in NOBA + TCV growth to 141 (72) MSEK – Market uncertainties remain + 23% ARR growth to 1 413 MSEK + EBITA growth of 78% to 82.1 MSEK + Acquisition of sepago GmbH in DE
Slide 8: Acquisition of sepago GmbH
Acquisition of sepago GmbH • Founded 20 years ago • 85 employees in Cologne, Hamburg and Munich About • 100 enterprise and public customers • Cloud consulting: Strategy, workplace, infrastructure, security • Microsoft gold partner, Citrix platinum advisor • Strategic public cloud and transformation
Slide 9: Acquisition of sepago GmbH – Financials
Acquisition of sepago GmbH • Purchase price: 12 MEUR cash-free, debt-free • Earn-out: 4 MEUR over 2.5 years • Multiple: Financials • Yearly revenue: 5-6x EBITA 15 MEUR • EBITA margin: >10 %
Slide 10: Key developments in Q2
Key developments in Q2 • As one of only five partners in Europe, Proact reaches the in Azure Advanced Specialization for Networking Services. • Proact launches new cloud service (PMCP) for modern DevOps-based software development • Proact launches new networking services with software- defined manag
Slide 11: Proact Managed Container Platform
Broadening our cloud portfolio Proact Managed Container Platform • State of the art and unique Container-as-a-service in the market • Customers get access to platform, complete software stack, deployment consultancy and support • Service allows customers to focus on core business development • Speed
Slide 12: SD-Connect – enabling edge computing
Broadening our cloud portfolio SD-Connect – enabling edge computing SD-WiFi – connecting people in the office SD-LAN – connecting devices in the office or DC SD-WAN – connecting the Edge to the Cloud Software Defined multi-cloud connectivity: • Quick to deploy, simple to manage, fast to revenue • AI
Slide 13: Financial development
Financial development
Slide 14: Income Statement – Highlights Q2 2022
Income Statement – Highlights Q2 2022 TOTAL REVENUE SYSTEM SALES SERVICES SALES GROWTH MSEK GROWTH MSEK GROWTH MSEK 31% 1,154 39% 706 21% 447 Adj. EBITA Adj. PROFIT BEFORE TAX GROWTH MSEK Margin GROWTH MSEK Margin 78% 82,1 7.1% 90% 64.7 5.6%
Slide 15: Revenue development
Revenue development Key developments in the second quarter • Revenue growth 31% • 21% organically • Acquisitions contributing 7% and currency effects 3% • New cloud contracts of SEK 141 million (72) • Services growth of 21% (6% organically) • Cloud revenue increase of 36%, positively impacted by acq
Slide 16: Profitability development
Profitability development Key developments in the second quarter • Adjusted EBITA of SEK 82.1 million (46.0) • Increase by 79% • Margin of 7.1% (5.2) • Gross margin decreased slightly • Increasing margins in systems • Decreasing margins in services, in particular in BU NOBA • SG&A costs increased by
Slide 17: BU Nordics & Baltics
BU Nordics & Baltics Key developments in the second quarter • Revenue growth 38% (36% organically) • Systems 53% (organic 51%) • Services 8% (organic 5%), with increase in all services but mainly cloud services 14% • Strong demand for systems and services, including strong TCV development • Several
Slide 18: BU UK
BU UK Key developments in the second quarter • Revenue decreased with 18% (-22% organically) • Systems -40% (organically -42%) • Services increased 8% (organically 2%) • Growth in cloud services and consulting, while support negatively impacted by lower systems sales earlier • High impact of deliver
Slide 19: BU West
BU West Key developments in the second quarter • Revenue growth by 13% • Organic growth 10% • Systems 5% (1% organically) • Services 17% (13% organically) • Low growth in Systems sales with Proact’s market transforming to increased demand for services • Strong demand for all services, especially for
Slide 20: BU Central
BU Central Key developments in the second quarter • Revenue growth by 131% (organic 46%) • Systems 130% (organically 78%) • Services 135% (organically 4%) • ahd contributing by 64 MSEK in revenues • Strong organic systems growth from a weak quarter last year • Healthy demand leading to growth in sup
Slide 21: Cash flow in Q2
Cash flow in Q2 Liquid Funds March 31, 2022 418 • Positive cash-flow from current operations Cash-flow from current operations 130 before change in working capital Current operations 107 • Positive change in working capital is mainly Change in working capital 23 related to a decrease in accounts rec
Slide 22: Cash flow January – June 2022
Cash flow January – June 2022 Liquid Funds December 31, 2021 464 • Positive cash-flow from current operations Cash-flow from current operations 168 before change in working capital Current operations 201 • Negative change in working capital is mainly Change in working capital -33 related to increase
Slide 23: Balance sheet
Balance sheet 2022 2021 2021 • Equity ratio of 22% (MSEK) Jun 30 Dec 31 Jun 30 • Cash position of SEK 528 million Total Assets 3,626 3,395 3,043 whereof Goodwill 844 821 647 • Net debt, including leasing liabilities, of whereof Intangible fixed assets 211 225 132 SEK 198 million, increased since Jun
Slide 24: Financial goals
SALES GROWTH FINANCIAL TARGET OUTCOME SEK 3,971 million in sales rolling 12 months GOALS >10% 11.1% Rolling 12 months EBITA MARGIN TARGET OUTCOME* Increase from 5.8% for 2021 8% 6.3% NET DEBT/EBITDA TARGET OUTCOME* <2 0.49 Remains significantly better than target ROCE TARGET OUTCOME Increase from 13
Slide 25: Summary
Summary • Strong revenue growth organically and through acquisitions • High demand for managed cloud services and strong growth in Annualized Recurring Revenue (ARR) • Strategic public cloud acquisition of sepago in Germany • Improvements in profitability
Slide 26: Thank you
Thank you www.proact.eu