Exsitec (EXS) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales rose 5% year-over-year to SEK 161 million, driven by acquisitions, while organic growth declined by 5% and recurring software revenue grew 32–34% year-over-year.

• Significant internal investment included over 110 new hires, with a major trainee program expansion, raising short-term costs and lowering margins.

• CEO Johan Källblad announced plans to step down after 14 years, with a transition process underway and a new CFO appointed.

• Order intake improved late in the quarter, and employee churn decreased, supporting future growth.

Financial highlights

• Q3 2024 net sales: SEK 161m (Q3 2023: SEK 153m); nine-month net sales: SEK 585m (2023: SEK 540m).

• Adjusted EBITA for Q3: SEK 6m, down 49% year-over-year; nine-month adjusted EBITA: SEK 91m, up 2% year-over-year.

• Adjusted EBITA margin dropped to 3.8–4% from nearly 8% last year, reflecting hiring costs.

• Q3 earnings per share: SEK -0.28 (Q3 2023: SEK 0.13); cash flow from operations in Q3 was SEK -1m.

• Direct trainee program costs were SEK 4–4.5m in Q3, with total program costs estimated at SEK 14–15m.

Outlook and guidance

• Management expects positive contribution from new staff by Q2 2025, with organic growth to return as market sentiment stabilizes.

• Consulting services and software subscriptions are expected to grow, though price-driven growth will moderate.

• Order intake and capacity utilization improved in September, supporting confidence in future growth.

• Market sentiment suggests 2024 may be a low point, with expectations for recovery in 2025.