Bechtle Reports Strong First Quarter
- Business volume up 15.8 per cent to €1.89 billion
- Revenue grows by 11.6 per cent to €1.54 billion €
- EBT increases by 7.6 per cent to €79.7 million
- EBT margin at 5.2 per cent
- Operating cash flow significantly improved
Neckarsulm, 11 May 2023 – Bechtle AG has made a very good start into its 40th anniversary year of 2023. The business volume increased by 15.8 per cent to €1,886.0 million. Maintaining the high dynamics of the prior year, Bechtle thus again grew much faster than the market. Revenue also underwent a very significant increase of 11.6 per cent to €1,538.5 million. Organic growth amounted to 8.5 per cent. Bechtle was able to step up its earnings before taxes (EBT) by 7.6 per cent to €79.7 million. The EBT margin of 5.2 per cent was almost the same level as in the prior year (5.4 per cent). As of 31 March 2023, Bechtle had 14,324 employees, a year-on-year increase of 1,358.
With 10.2 per cent in Germany and 13.6 per cent in the other countries, revenue growth was largely balanced throughout the regions. However, segment performance varied greatly. “At group level, we managed to balance the inconsistent growth and earnings performance in our two operating business segments, thereby making a compelling start into the year. This again underlined the strength of our business model," according to Dr. Thomas Olemotz, Chairman of the Executive Board of Bechtle AG.
High Demand for Complex IT Solutions
In the IT System House & Managed Services segment, revenue climbed by 19.4 per cent to €993.5 million. This performance was mainly driven by the sales achieved with public-sector clients and large customers. The demand for more complex IT projects in connection with multi-cloud transformation increased as well. The growth of the system houses in Austria, Switzerland and the Netherlands was especially strong, in part also due to acquisitions. In this segment, we increased our EBIT by 19.1 per cent to €55.9 million. The EBIT margin remained at its high level of 5.6 per cent.
E-Commerce Performance Mixed
In the IT E-Commerce segment, especially the software business resulted in an increase of the business volume by 7.5 per cent. By contrast, revenue dropped slightly by 0.4 per cent. Growth was especially strong in the Netherlands, the United Kingdom and Spain. In France and Germany, our two largest national markets, however, we noticed a weakening demand in the conventional infrastructure business with medium-sized businesses and with a small number of larger customers. In view of the higher cost base, EBIT thus declined by 11.7 per cent, and the EBIT margin went down to 4.6 per cent (prior year: 5.2 per cent).
Investing in the Future
The headcount increase in the first quarter amounted to 10.5 per cent, a rate lower than that of the growth of the business volume. At about 70 per cent, the increase was largely made up of newly recruited people, plus 399 people who joined us as a result of acquisitions. Bechtle is still able to cover its demand for employees for further growth. However, this also involves higher recruitment and staff development expenses.
Operating Cash Flow Greatly Improved
In the first quarter, the cash flow from operating activities stood at with -€20.2 million, a significant year-on-year increase (prior year: -€127.1 million ). Significant improvements were achieved especially with regard to the inventories and the trade receivables. At €227.5 million , the total liquidity is at a very comfortable level that enables the financing of further growth as well as acquisitions.
Forecast Confirmed
Though the situation in the global supply chains further relaxed in the first quarter of 2023, some product groups still have delivery times of up to six months. The macroeconomic situation remains tense and is overshadowed by major uncertainties. Nevertheless, the Executive Board confirms the forecast published in March for the performance of Bechtle AG. “Our Q1 figures are in line with our goals for the fiscal year or, as far as the revenue growth is concerned, even higher. Despite the still rather weak macroeconomic setting, we thus remain confident with regard to the performance of Bechtle AG in the 40th year of our corporate history," reported Dr. Thomas Olemotz.