Proact It Group Ab · OMXSTO:PACT
Proact It Group Ab — Q3 2021 Earnings Presentation
26 slides from Proact It Group Ab's earnings presentation, Oct 21, 2021
Slide 1: Summary Q3 2021
Summary Q3 2021 October 21, 2021 Jonas Hasselberg CEO and President jonas.hasselberg@proact.eu Linda Höljö CFO www.proact.eu linda.holjo@proact.eu
Slide 2: Agenda
Agenda • Proact introduction • Proact’s market • Key developments • Financial results • Summary Jonas Hasselberg Linda Höljö CEO and President CFO
Slide 3: Who is Proact
Who is Proact FI NO 1994 Almost 3 decades of helping customers drive SE business value and growth – through IT EE LV DK LT 4,000 Medium and large enterprise UK NL customers across Europe BE DE CZ 350 Million-euro turnover with stable finances. Listed on Nasdaq Stockholm since 1999 1,000 Employees wi
Slide 4: Specialist in IT Infrastructure for managing Data and Information
Specialist in IT Infrastructure for managing Data and Information CONSULTING MANAGED SERVICES HARDWARE & SOFTWARE TECHNICAL SUPPORT
Slide 5: Businesses across all industries are in state of transformation
Businesses across all industries are in "state of transformation”. Data is the key to this transformation. The three defining trends in the market - Focus on digital transformation and business innovation through IT - Increase speed, flexibility and availability through multicloud - Ensure cyber sec
Slide 6: The three defining market trends
THE THREE DEFINING MARKET TRENDS DIGITALIZATION & INNOVATION MULTICLOUD / CLOUD SECURITY 2022-2024 Infrastructure yearly growth 7.0% ~2% Managed Services yearly growth ~10% Sources: IDC’s 2020 annual multicloud and next-generation infrastructure survey N=1187 MarketsAndMarkets, TC 3428 Cloud Managed
Slide 7: Value to customers via our propositions
Value to customers via our propositions
Slide 8: Our deployment models enable delivery to you
Private Public Managed Our deployment models enable delivery to you anywhere On-premises infrastructure
Slide 9: Proact NPS score of 44
Strong results in Proact NPS Survey How likely are you to recommend Proact to other organisations and peers? Promoters (9-10) Passives (7-8) Detractors (0-6) 53% 38% 9% Proact NPS score of 44
Slide 10: AFA Insurance: Going from a month to an hour
Going from a month to an hour AFA Insurance When AFA Insurance modernises its IT from the ground up, application development can be accelerated dramatically. Moving enterprise applications to a container-based platform makes the goal within reach. Proact & Conoa contributed with • Container platform
Slide 11: Quarter in brief
Quarter in brief + 6% up in Services revenue – Revenue down 1% to 810 (821) MSEK + GM increasing to 24.9% (21.7%) – 6% down in System revenue + EBITA % increased to 7.4% (6.6%) – Covid-19 uncertainties + TCV growth of 23%
Slide 12: Key developments in Q3
Key developments in Q3 • Integration of Cetus & Conoa on track with good progress on cross- and up-sell as well as co-development of offerings • Awarded NetApp EMEA Solutions Partner and Cohesity EMEA Impact Marketing Partner of the year • Frame agreement with AI Sweden signed to provide expertise t
Slide 13: Financial development
Financial development
Slide 14: Income Statement – Highlights Q3 2021
Income Statement – Highlights Q3 2021 TOTAL REVENUE SYSTEM SALES SERVICES SALES GROWTH MSEK GROWTH MSEK GROWTH MSEK -1% 810 -6% 444 6% 367 Adj. EBITA Adj. PROFIT BEFORE TAX GROWTH MSEK Margin GROWTH MSEK Margin 11% 59.8 7.4% 14% 49.6 6.1%
Slide 15: Revenue development
Revenue development Key developments in the third quarter • Revenue growth -1% • -9% organically • Acquisitions contributing +8% and currency effects 0% • R12 months growth of -2% (2% in services, -5% in systems) • Services growth of 6% • 0% organic growth • Consulting services growth of 24% (organi
Slide 16: Profitability development
Profitability development Key developments in the third quarter • Adjusted EBITA of SEK 59.8 (54.1) million • Increase by 11% • Margin of 7.4 (6.6)% • Gross margin increasing, primarily in Systems • Favourable pricing development and customer mix • SG&A costs increased by 4% for comparable units • I
Slide 17: BU Nordics & Baltics
BU Nordics & Baltics Key developments in the third quarter • Revenue growth 6% • Systems -1% (organic -9%) • Services +20% (organic +14%), with increase in all services but mainly cloud services +43% • Conoa acquisition contributing by SEK 32 million, primarily within consulting services • Norway pr
Slide 18: BU UK
BU UK Key developments in the third quarter • Revenue decline 20% (42% organically) • Systems -46% • Services 21% • Cetus acquisition contributing by SEK 31 million • Decline in systems revenues organically of 70%, while services growing by 4% organically • EBITA margin increasing to 6.4% (5.5)% • E
Slide 19: BU West
BU West Key developments in the third quarter • Revenue declined by 1% • Organic growth 1% • Systems 0% • Services -1% • Action program in place to reverse declining trend • EBITA margin increasing to 5.6 (4.2)% • EBITA of SEK 9.9 (7.4) million • Action program implemented, with gross margins improv
Slide 20: BU Central
BU Central Key developments in the third quarter • Revenue growth by 14% • Systems 20% • Services 3% • Strong sales during summer • EBITA margin increasing to 7.6 (5.7)% • EBITA of SEK 6.7 (4.4) million • Organically reduced SG&A costs of 2% contributing to positive margin development in combination
Slide 21: Cash flow in Q3
Cash flow in Q3 Liquid Funds June 30, 2021 500 • Positive cash-flow from current operations Cash-flow from current operations -143 before change in working capital Current operations 96 • Negative change in working capital is mainly Change in working capital -239 related to a decrease in accounts pa
Slide 22: Cash flow Jan-Sept 2021
Cash flow Jan-Sept 2021 Liquid Funds December 31, 2020 468 • Positive cash flow from current operations Cash-flow from current operations 48 after change in working capital Current operations 241 • Negative change in working capital mainly Change in working capital -193 related to decrease in accoun
Slide 23: Balance sheet
Balance sheet 2021 2020 2020 • Equity ratio of 24% (MSEK) Sep 30 Dec 31 Sep 30 • Cash position of 321 MSEK Total Assets 2,768 2,924 2,788 whereof Goodwill 650 552 511 • Net debt of 160 MSEK, increased since Dec whereof Intangible fixed assets 126 112 71 2020 by 182 MSEK. whereof Accounts receivables
Slide 24: Financial goals
SALES GROWTH FINANCIAL TARGET OUTCOME SEK 3,565 million in sales rolling 12 months GOALS >10% -2% Rolling 12 months EBITA MARGIN TARGET OUTCOME* Improvement from Q2 8% 6.0% NET DEBT/EBITDA TARGET OUTCOME Remains significantly better than target <2 0.45 ROCE TARGET OUTCOME Impacted by IFRS 16 and acq
Slide 25: Summary
Summary • Decline in Systems sales driven by market hesitancy • Growth in Services revenue • Improvement in Gross Margin and good cost control
Slide 26: Thank you
PROACT Thank you www.proact.eu in@ fiv