Increase in margin confirms qualitative growth
Top position in customer satisfaction
Good start to the new fiscal year
Pliezhausen, January 23, 2018. DATAGROUP SE (WKN A0JC8S) today publishes the audited figures of FY 2016/2017. Following significant revenue growth and a disproportionate increase in all earnings figures it is planned to raise dividend payments from 30 to 45 cents per share. Management expects to continue the dynamic development in the current fiscal year.
The audited figures confirm our preliminary figures published at the end of November. Accordingly, DATAGROUP’s revenue grew by 27.6 % to EUR 223.1m (previous year EUR 174.9m) in FY 2016/2017 (01.10.2016 – 30.09.2017). Earnings before interest, taxes, depreciation and amortisation (EBITDA) grew disproportionately by 41.6 % to EUR 27.0m (EUR 19.1m), the EBITDA margin came in at 12.1 % (10.9 %). Even though increasing its guidance twice DATAGROUP exceeds the EBITDA guidance significantly (22 – 23m) also in terms of revenues the upper end of the guidance range of 215 – 225 has been reached. Earnings before interest and taxes (EBIT) grew disproportionately by 46.7 % and reached EUR 18.6m (EUR 12.7m), corresponding to an EBIT margin of 8.3 % (7.2 %).
“The strategic decisions of our Agenda 2020 have taken full effect since FY 2016/2017: The production deployment of our services in CORBOX, the systematic cutback of low-margin “time-and-material” business and targeted M&A activities boost our organisation’s efficiency – that is reflected across all key figures”, says DATAGROUP CEO Max H.-H. Schaber. “We have set new records in revenue and earnings yet again.” Net income jumped to EUR 11.2m (EUR 5.7m, +96 %), corresponding to EPS of EUR 1.41 (75 cents).
In addition to strong operating cash flow of EUR 32.5m (EUR 9.5m), the successful placement of a capital increase contributed to reducing net debt and strengthening the balance sheet structure. Issuing 759,000 new shares provided cash inflow of EUR 21.1m net for the company. The equity ratio grew to 28 % (18 %), significantly exceeding the targeted minimum level of 20 %. This has laid the financial basis for future growth, while increasing the free float. “The capital measures have been very well received by investors. As a result, the liquidity of DATAGROUP’s shares has improved significantly, while the market capitalisation has more than doubled to EUR 342m in the course of the year”, says Max H.-H. Schaber.
Based on the continued good business development, Management Board and Supervisory Board will propose to the AGM, which is scheduled for March 8, 2017 at the headquarters in Pliezhausen, to increase the dividend from 30 cents to 45 cents per share.
Earnings and customer satisfaction confirm the path taken
The qualitative growth confirms the path taken with a focus on offering high-quality services for medium-sized companies. For the first time, more than 80 % of revenues were generated by selling services. These have mainly been secured by long-term contracts, which at the same time allows for good visibility on the business and a control of capacities. “Both of this contributes to a disproportionate improvement of our margin figures”, says COO Dirk Peters. “However, the quality of our services is not only reflected in our economic figures but also in a continued high customer satisfaction.” The most recent IT Outsourcing Study from Whitelane and Navisco attests DATAGROUP further improvement in service quality. With a result of 80 % the company maintains successfully its second position among the 27 leading IT service providers in Germany and Austria.
Thanks to two more strategic acquisitions, DATAGOUP has further improved its own market position in the past fiscal year. With HanseCom (now: DATAGROUP Operate IT GmbH) and ikb Data (now: DATAGROUP Financial IT Services GmbH), the company acquired two successful Cloud and outsourcing service providers, expanding the competences and capacities in the core business segments. The acquisition of ikb Data particularly supplements the vertical sector competence by financial services. Additionally, the Group has gained access to interesting new customer relations due to both companies.
The available liquid funds provide DATAGROUP with sufficient room for further strategic acquisitions, helping to reasonably expand the range of customised software and IT solutions. “Digital transformation has reached almost every sector by now”, says Dirk Peters. “This is a great opportunity for us, as digitisation will increase the need for competent advice on conceptual design, the implementation and operation of ever more complex IT infrastructures. Particularly Mittelstand companies are searching for reliable partners that are operating at eye level in every respect. This will accelerate the consolidation pressure in the IT sector.”
Growth continued unabated in the first quarter of 2017/2018 – Positive outlook
The start to the new fiscal year indicates a continuation of dynamic growth in revenue and earnings. One highlight was an extension of the service agreement with an existing customer from the aviation industry by three additional years. The contract comprises the global support of some 17,000 IT workplaces and mobile users, and has a volume of EUR 16m.
“In 2018, we will also consistently pursue our goal of becoming German market leaders with CORBOX by 2021 as outsourcing and Cloud providers for companies with 250 to 5,000 IT workplaces and developing our revenue towards EUR 500m. We believe we are on the right way“, concludes Max H.-H. Schaber.
Traditionally, the management substantiates its outlook for the current fiscal year at the Annual General Meeting.
The 2016/2017 annual accounts are available for download on www.datagroup.de/investor-relations.
The Management Board of DATAGROUP SE will explain the figures of FY 2016/2017 in a conference call taking place on January 29, 2018 at 3:00 am CET (dial-in numbers +49-89 244 184 437; +44 1635 598 060; +33 4 82986014). All interested investors, analysts, and journalists are cordially invited to participate.
A replay will be available right after the conference call on www.datagroup.de/investor-relations/.
The company’s Annual General Meeting is scheduled to take place on March 8, 2018 at the company’s headquarters in Pliezhausen.