Zalaris (ZAL) Deutsches Eigenkapitalforum 2024 Presentation summary

Company overview and market positioning

• Leading European provider of payroll and human capital management solutions, serving 1.5 million employees monthly across 17 countries, with a strong presence in Germany, Nordics, DACH, UKI, and APAC regions.

• Offers a comprehensive HR platform (PeopleHub) covering the full employee lifecycle, including payroll, benefits, time management, talent management, and travel/expense solutions.

• Focuses on large and mid-size enterprises, especially those with multi-country operations and complex HR needs, with a stronghold in first-generation outsourcing deals.

• Maintains a diversified blue-chip customer base across multiple industries, including major corporations like Siemens, Ericsson, Nordea, and Ryanair.

• Well-positioned for global expansion through a partner ecosystem, enabling onboarding of European customers with global demands.

Business model and revenue profile

• Operates through two integrated business units: Managed Services (cloud payroll/HR outsourcing, ~75% of revenue, ~90% recurring) and Professional Services (consulting, ~25% of revenue, ~55% recurring-like).

• Revenue is predominantly annual and recurring, with Managed Services contracts averaging five years, low churn (1.5–3%), and high net retention (108% YoY Q4'24).

• Germany is the largest and fastest-growing market, accounting for 37% of Q3 2024 revenue.

• Recent contract wins include global accounts in logistics, fast food, and call centers, supporting further international growth.

Financial performance and outlook

• Achieved 20% organic revenue growth LTM YoY (17% in constant currency), with Q3 2024 LTM revenue at ~EUR 110m and an adjusted EBIT margin of 10.3%.

• Q3 2024 revenue reached NOK 339.7m, with an adjusted EBIT margin of 10.9%.

• Strong revenue visibility through 2024/25, with new BPO customers expected to drive >13% revenue increase based on signed contracts.

• All current contracts expected to be fully implemented by Q1 2026, supporting continued growth.