Vitec Software Group (VIT) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 reached SEK 882 million, up 22% year-over-year; H1 2024 net sales were SEK 1,598 million, up 20% year-over-year.

• Recurring revenues for Q2 2024 were SEK 775 million, up 27%; H1 2024 recurring revenues were SEK 1,391 million, up 24% year-over-year.

• EBITA for Q2 2024 was SEK 264 million, up 17%, with a margin of 30%; H1 2024 EBITA was SEK 484 million, up 18% year-over-year.

• Three acquisitions completed or announced in 2024: LDC, Bidtheatre, and Taxiteknik, strengthening the vertical software portfolio.

• Serves over 24,600 customers across 40 business units in 11 countries, focusing on standardized niche business-critical software.

Financial highlights

• EBITA margin for Q2 and H1 2024 was 30% (down from 31% year-over-year); operating margin for Q2 was 22% (down from 23%).

• Earnings per share before dilution for Q2 2024 was SEK 3.18 (up from 2.59); H1 2024 was SEK 5.46 (up from 4.66).

• Cash flow from operating activities for H1 2024 was SEK 783 million (up from 569 million last year).

• Proforma net sales for the last twelve months reached SEK 3,197 million; 10-year CAGR for net sales is 22.3%.

• Recurring revenues accounted for 88% of Q2 2024 net sales.

Outlook and guidance

• Continued focus on responsible growth through organic innovation and strategic acquisitions.

• Cautious approach to new sales, but strong additional sales to existing customers.

• Well-diversified product portfolio and recurring revenue base support sustainable profit growth.

• Management sees stable markets and long-term customer relationships.