Vitec Software (VIT) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 reached SEK 880 million, up 23% year-over-year, serving over 26,000 B2B customers across 46 business units in 12 countries, with sales in over 50 countries.

• Recurring revenues grew 28% to SEK 786 million, representing up to 93% of total revenues, driven by a product-based, decentralized business model.

• EBITA remained stable at SEK 220 million, with EBITA margin declining to 25% from 31% due to higher amortization and a shift in revenue mix.

• Operating profit was SEK 153 million, unchanged from last year, while EPS before dilution decreased 8% to SEK 2.09.

• Acquisition of Dutch company Intergrip completed in Q1 2025, contributing to growth and recurring revenue.

Financial highlights

• Net sales: SEK 880 million (Q1 2024: SEK 716 million), up 23%.

• Recurring revenues: SEK 786 million (Q1 2024: SEK 616 million), up 28%, with recurring share of net sales at 89%.

• EBITDA/EBITA margin: 25% (down from 31% year-over-year); operating margin: 17% (down from 21%).

• Cash flow from operating activities increased to SEK 757 million, representing 86% of net sales.

• Cash EBIT rose 12% to SEK 178 million; cash flow per share: SEK 6.05.

Outlook and guidance

• Organic pro forma growth expected to slow as inflation-driven price increases moderate.

• High proportion of recurring revenues and diversified customer base provide stability amid mixed market demand and global uncertainty.

• OpEx expected to decrease in Q2 and Q3 due to seasonality and completion of salary increases.

• Readiness for further acquisitions is strong, supported by robust cash flow and new financing arrangements.

• No material changes in risk assessment since the last annual report; ongoing monitoring of external factors.