Gofore (GOFORE) Q1 2025 earnings summary

Executive summary

• Net sales declined by 5.7% year-over-year to EUR 46.4 million in Q1 2025, with profitability weakening due to high free capacity and delivery challenges.

• Adjusted EBITA margin dropped to 8.0% from 13.8% year-over-year, mainly from underutilized capacity and project overruns.

• Change negotiations were initiated in April 2025, targeting up to 95 headcount reductions to align with demand and save EUR 7.6 million annually.

• Public sector sales remained stable, while private sector sales fell 14%; public sector now represents 61% of net sales.

• The company continues to invest in growth areas such as data, AI, cybersecurity, and technology management services.

Financial highlights

• Net sales: EUR 46.4 million (Q1 2024: EUR 49.2 million), down 5.7% year-over-year.

• Adjusted EBITA: EUR 3.7 million (Q1 2024: EUR 6.8 million), margin 8.0% (13.8%).

• Operating profit (EBIT): EUR 2.8 million (Q1 2024: EUR 5.8 million), margin 6.1% (11.7%).

• Profit for the period: EUR 2.0 million (Q1 2024: EUR 4.4 million).

• Earnings per share (undiluted): EUR 0.11 (Q1 2024: EUR 0.27).

• Cash flow from operations: EUR -1.0 million (Q1 2024: EUR 8.3 million).

• Equity ratio: 62.1% (Q1 2024: 57.7%); net gearing: -28.7% (Q1 2024: -20.1%).

Outlook and guidance

• No revenue or profit guidance provided; gradual recovery in customer demand expected, but no impact anticipated in Q2.

• Positive effects from change negotiations expected post-Q2; Q2 profitability to remain under pressure from low utilization and continued price competition.

• Long-term targets reaffirmed: EUR 500 million net sales by 2030, adjusted EBITA margin of 15%, and at least 40% of annual net profit as dividends.