Proact It Group Ab · OMXSTO:PACT
Proact It Group Ab — Q4 2024 Earnings Presentation
22 slides from Proact It Group Ab's earnings presentation, Feb 11, 2025
Slide 1: Proact IT Group Quarterly presentation Q4 2024
Proact IT Group Quarterly presentation Q4 2024 11 February 2025
Slide 2: Agenda
Agenda • Proact introduction • Proact’s market • Quarterly highlights • Financial results • Summary Jonas Hasselberg Noora Jayasekara CEO and President CFO
Slide 3: Proact is a leading IT expert securing business critical data via hybrid cloud
Proact is a leading IT expert helping customers secure business critical data via world-class hybrid cloud solutions Proact introduction Proact in brief Geographical footprint Revenue and EBITA development (SEKm) • Founded in 1994, Proact has secured business critical data & pushed the Revenue limit
Slide 4: Proact is present in Northern Europe across 4 Business Units
Proact is present in Northern Europe distributed across 4 Business Units; Hybrid cloud services through our 4 main delivery HUBs Proact geographical presence and business units NOBA UK • c. SEK 2,530m revenue • c. SEK 710m revenue • 320 employees • 250 employees • 100+ Sales employees • 70+ Sales em
Slide 5: We offer best-in-class services across the cloud journey
We offer best-in-class services; Our broad offering enable us to support our customers wherever they are in their cloud journey Proact offering 9% 23% Revenue streams1 55% 13% Systems Support services Managed Cloud Services Consulting services Independent provider and value- Premium support for the
Slide 6: Proact is well-positioned in an attractive growing market
Proact is well-positioned in an attractive growing market, with trends such as Cybersecurity and AI driving the demand for data and IT solutions Market trends and development Strong drivers and favourable trends Digital transformation, Sustainability and Increased demand for Information security Hyb
Slide 7: Growing market with strong growth driven by cloud adoption
We act on an increasingly growing market, with strong growth driving from cloud adoption anticipated in the years ahead Systems and services market size, SE, NL, UK, DE CAGR CAGR 2021-24 2024-27 +5% +3% Cloud +12% +12% Non-cloud -2% 0% 2021 2022 2023 2024F 2025F 2026F 2027F
Slide 8: Mission-critical services to customers across all industry verticals
We provide mission-critical services to customers across all industry verticals Selected Proact customer’s mission-critical use cases Guiding customer’s on their journey to cloud Delivery Route Digital Patient Records SaaS Optimization AI Automated Rapid Application Cyber protection and Redaction De
Slide 9: We create value by delivering secure and flexible IT solutions
We create value by delivering secure and flexible IT solutions that meet evolving needs Teacher Stern Dole Nordic "As part of a planned transition from our previous managed service provider, "We needed a partner who could take full responsibility for our data center, Teacher Stern conducted a rigoro
Slide 10: 2024 Q4 Highlights
2024 Q4 Highlights Quarterly highlights • New record in cloud services agreements, further strengthening our market position Annualised recurring Revenue revenue • Strong cash flow and a continued positive development in 1,269 SEKm 1,781 SEKm (-6.7%) gross margin, driven by our strategic focus on ef
Slide 11: Q4 revenue of 1,269 SEKm, -6.7% primarily driven by NOBA
Q4 revenue of 1.269 SEKm, -6.7% primarily driven by NOBA Revenue development, 2023 Q4 – 2024 Q4 Revenue by revenue stream (SEKm) -6.7% • Total revenue decreased -6.7% whereof -7.2% 1,360 organically -97 • System sales decreased with -97 SEKm (organically 1,269 -12.3%), primarily due to a temporary d
Slide 12: Growing share of recurring revenues at 11.4% CAGR
Growing share of recurring revenues at a 11.4% CAGR from 2020-2024, currently making up 36% of total revenue Annualised recurring revenue development, 2020-2024 SEKm 1,800 11.4% 1,748 1,781 1,552 • ARR increased +1.9% in reported numbers 1,500 • New cloud service agreements amounted to 224 1,307 SEK
Slide 13: EBITA decreased by -12.0% compared to last year
EBITA decreased by -12.0% compared to last year, mainly due to lower sales in the systems business EBITA development, 2023 Q4 – 2024 Q4 -12.0% -1.1 -9.0 20.5 91.1 -10.8 -10.5 80.2 6.3% 6.7% EBITA Q4 2023 Nordic & Baltics UK West Central Other EBITA Q4 2024 EBITA margin Note: Other incl. currency adj
Slide 14: Net cash increased from SEK 80 million to SEK 330 million
Net cash after dividends and share buybacks increased from SEK 80 million in December 2023 to SEK 330 million by the end of 2024 Net cash development Q4 2023 vs Q3 2024 (SEKm) Whereof 550 Whereof 814 SEKm cash, SEKm cash, 220 -59 -44 -27 230 SEKm interest bearing SEKm interest debt and 254 SEKm leas
Slide 15: Strategic efficiencies and service focus drive strong cash flow
Strategic efficiencies and focus on service business drive strong cash flow Cash generation, accumulated per year, 2020-2024 (SEKm) 532 524 468 454 317 304 292 234 203 191 168 159 149 104 90 48 38 30 -30 -56 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2020 2021 2022 2023 2024
Slide 16: Continued strong EBITA margin in Nordic & Baltics
Continued strong EBITA margin in Nordic & Baltics Business Unit deep-dive: Nordic & Baltics Nordic & Baltics Financial development Comments SEKm Q4 2024 Q4 2023 Change (%) • Total revenue down -7.7% and -7.6% Revenue 717 777 -7.7% organically Share of total 52% EBITA 72 52 +39.6% revenue1 EBITA marg
Slide 17: Strong system sales in the UK offset lower support services
Strong system sales in the UK compensate for the decline in customer support services Business Unit deep-dive: UK UK Financial development Comments SEKm Q4 2024 Q4 2023 Change (%) • Total revenue increased +5.9% and +1.5% Revenue 175 165 5.9% organically Share of total 15% EBITA 3 5 -25.3% revenue1
Slide 18: Total revenue and EBITA decline in West
Total revenue and EBITA decline due to lower systems and services revenue Business Unit deep-dive: West West Financial development Comments SEKm Q4 2024 Q4 2023 Change (%) • Total revenue decreased -5.6% and -5.8% Revenue 198 210 -5.6% organically Share of total 17% EBITA 4 13 -69.5% revenue1 EBITA
Slide 19: Lower system sales impact Central revenues and EBITA
Lower system sales impact total revenues and EBITA Business Unit deep-dive: Central Central Financial development Comments SEKm Q4 2024 Q4 2023 Change (%) • Total revenue decreased -8.4% and -8.3 Revenue 210 230 -8.4% organically Share of total 18% EBITA 6 17 -65.2% revenue1 EBITA margin (%) 2.8% 7.
Slide 20: Good progress against long-term financial targets
We continue to make good progress against our long-term financial targets on a full-year basis Financial development and long-term financial targets Sales EBITA Leverage ROCE Dividends Sales growth per annum EBITA margin Net debt / EBITDA Return on capital employed Dividends as share of profit 10% 8
Slide 21: Summary
Summary • Demand is good, driven by digitalisation, cybersecurity and AI. Despite challenging comparables in Q1, we are positive about 2025. • Proact is well positioned for organic growth with both existing and new customers. • A strong balance sheet and stable cash flow enable complementary acquisi
Slide 22: Thank you
Thank you