adesso (ADN1) Q1 2025 TU earnings summary

Executive summary

• Achieved 11% organic sales growth to EUR 353.4 million in Q1 2025, outperforming peers in a challenging macroeconomic environment.

• Maintained a workforce of over 10,400, with a 5–6% year-over-year increase and low attrition rate (~8%), supporting operational scalability.

• EBITDA was EUR 17.8 million, flat year-over-year, with margin subdued by higher personnel and material costs.

• Consolidated earnings for Q1 2025 were negative at EUR -4.1 million, down from EUR -3.3 million in Q1 2024, mainly due to increased depreciation and financial expenses.

• Focused on IT services (90% of sales) and industry-specific solutions, with a diversified portfolio across insurance, banking, health, public, automotive, manufacturing, retail, and utilities.

Financial highlights

• Revenue rose 11% year-over-year to EUR 353.4 million, with 84% generated in Germany.

• EBITDA margin declined to 5.1% from 5.6% year-over-year.

• Earnings per share were EUR -0.54, down from EUR -0.49 in Q1 2024.

• Net debt increased to EUR 110.6 million as of March 31, 2025, up from EUR 90.5 million a year earlier, mainly due to shareholding increases and share buybacks.

• Free cash flow and operating cash flow were negative in Q1 2025, reflecting higher investments, working capital, and typical seasonal patterns.

Outlook and guidance

• Guidance for 2025 confirmed: revenue EUR 1.35–1.45 billion, EBITDA EUR 105–125 million.

• Majority of earnings expected in H2 2025 due to more working days and anticipated pick-up in insurance and public sector business.

• Expect improved margins in H2 due to higher utilization, reduced investments, and SAP offering.

• Anticipate positive impact from increased government spending and digital transformation demand.

• EBITDA margin target set at 8%+ X, with current performance on track.