Bechtle (BC8) Q4 2024 earnings summary

Executive summary

• Fiscal year 2024 performance was below expectations due to challenging economic conditions, especially in Germany and France, with both SME and public sector clients showing investment reluctance.

• Business volume increased by 2.0% year-over-year to €7,949m, while revenue declined by 1.8% to €6,306m; software and cloud remain key growth drivers.

• EBIT fell 8.1% year-over-year to €351.3m, with a group margin of 5.6%.

• Q4 showed a 4.4% growth rate, the highest of the year, but not seen as a sustainable trend reversal.

• Workforce increased by 4.2% to 15,801, with 60% of new hires from acquisitions; organic workforce growth was 1.7%.

Financial highlights

• International revenue rose 6.5% to €2,584m, while German revenue dropped 6.9% to €3,722m.

• IT E-commerce segment revenue increased 4.4% to €2,391m; IT SH & MS segment revenue declined 5.3% to €3,915m.

• Gross margin reached a record 18.1%, driven by a higher share of software and services.

• Operating cash flow hit an all-time high of €558.2m, with free cash flow at €377m.

• After-tax earnings fell by 7.5%; dividend maintained at €0.70 per share, with a payout ratio of nearly 36%.

Outlook and guidance

• 2025 outlook is highly uncertain; no revival expected before the second half of the year.

• Guidance: business volume 0% to +5%, revenue -3% to +3%, EBT -5% to +5%, with potential for positive development in H2.

• EBT margin expected at best to match previous year.

• M&A excluded from guidance; at least one transaction expected in H1 2025.

• Cash flow expected to remain positive, though not at 2024's record level.