DATAGROUP (D6H) Q1 2025 earnings summary

Executive summary

• Achieved 15% revenue growth in Q1 2024/2025, with 8% organic growth and strong new business momentum, including major contracts in IT outsourcing and workplace services.

• Focus on long-term, recurring contracts and a diversified customer base across industries, including finance, energy, logistics, and manufacturing.

• Strategic acquisition of TARADOR strengthens cybersecurity offerings for SMEs, public sector, and critical infrastructure, expanding cross-selling potential.

• Continued innovation in AI, cybersecurity, and cloud, launching the seventh generation of the CORBOX service portfolio.

• Stable business model driven by recurring IT services, with strong customer retention and cross/upselling opportunities.

Financial highlights

• Q1 revenues reached EUR 139.3 million, up 15% year-over-year; services and maintenance revenue grew 6.8% to EUR 111.9m, and trading revenue surged 64.9% to EUR 27.1m.

• EBITDA was EUR 17.6m (down 5%), EBIT EUR 9.2m (down 8.8%), and net income EUR 4.3m (down 28.5%); EPS declined to EUR 0.52.

• Gross profit increased slightly more than personnel costs, indicating early benefits from automation.

• Cash flow from operations dropped to EUR -0.4m, impacted by hardware rollouts, one-off license payments, and reduction in trade payables.

• Net debt increased to EUR 155.6m (up 11.9%), with net debt/EBITDA at 1.79x; equity ratio stable at 28.6%.

Outlook and guidance

• Strong sales pipeline and order entry (EUR 18.7m annual contract value) expected to drive growth in 2025 and 2026.

• Targeting 2-4 acquisitions per year and continued organic growth through cross- and upselling.

• Margins expected to normalize by fiscal year-end as transition costs subside; guidance for 2024/2025 to be published at the AGM in March 2025.

• New CORBOX generation launched in January 2025, enhancing integration, scalability, and security.