Nedap (NEDAP) CMD 2024 summary

Strategic transformation and focus

• Shifted from 11 market groups to four key markets: Healthcare, Livestock, Retail, and Security, each with a leading position and balanced revenue contribution (2023 split: Livestock 31%, Healthcare 28%, Security 22%, Retail 19%).

• Digital twin technology is the core differentiator, enabling actionable insights and automation across all markets.

• Strategy centers on market leadership, only investing where a clear path to leadership exists, with a structured 'Create & Scale' methodology for organic growth.

• Transitioned from hardware-focused to SaaS and recurring revenue models, emphasizing innovation, talent development, and global presence.

• Strategic agility and continuous strategy process adopted to navigate volatile markets and intensifying competition.

Key market overviews and growth drivers

• Healthcare: 60% market share in elderly care, 50% in disability care, 20% in mental health; focus on network care, platform expansion, and high customer retention (99%).

• Security: Serving 2,500+ organizations in 83+ countries, including 36% of top 250 EU companies; expanding SaaS and cloud-based solutions.

• Retail: Leading RFID SaaS platform (35% market share), focus on large retailers, aiming to double RFID adoption in five years, with high retention and cross-sell strategy.

• Livestock: 40% global share in cow monitoring, 30,000+ farms, 5.5 million cows connected; growth driven by farm consolidation, rising milk demand, and technology adoption.

• Sustainability: Committed to SBTi, net-zero operations by 2030, and supporting customers' sustainable business models.

Financial performance and guidance

• Achieved 8% annual organic revenue growth and 11% EPS CAGR from 2019 to 2023.

• Recurring revenue reached €100 million, growing at 17% CAGR since 2019 and 20% YoY in 2024.

• Gross margin improved from 63% (2019) to 69% (2023), supporting high R&D investment (18% of revenue in 2023).

• Mid-term guidance targets high single-digit organic revenue growth, operating margin toward mid-teens by 2026–2028, and ROIC above 30%.

• Capital allocation prioritizes organic growth, with selective M&A for key market opportunities, minimum solvency rate of 50%, and high dividend payout.