Bechtle continues its very dynamic growth

• Business volume up 20.5% from previous year
• Revenue increases by 14.6% in the third quarter
• EBT rises to €88.2 million
• Focus on education and training

Neckarsulm, 10 November 2022 - Bechtle AG continued its successful performance in the third quarter of 2022. Germany's largest IT system house continues to gain market share, especially in international business with corporate groups. Revenue growth maintained the high level seen in the previous quarter and rose very significantly by 14.6% to €1,463.9 million. Business volume actually grew by 20.5% to €1,803.4 million. The pre-tax result (EBT) increased by 1.3% to €88.2 million. EBT margin was 6.0%. As of 30 September 2022, Bechtle employed 13,789 people, which is 1,045 more than in the same quarter of the previous year. In September, 256 young people started their vocational training or dual study programme at Bechtle, more than ever before. Bechtle currently employs a total of 815 trainees.

Revenue growth was particularly striking in the foreign markets where Bechtle saw growth of 17.4%. Eastern Europe in particular, but also Spain and Portugal as well as the UKerheblich and Ireland showed high double-digit growth rates. The IT service provider achieved organic growth of its quarterly revenues amounting to 12.7%. The IT System House & Managed Services segment achieved considerable revenue growth within the segments of 21.7%. Bechtle's positioning as an IT partner for the digital transformation is leading to a further increase in demand, especially for IT security, managed cloud services and multi-cloud architectures. In IT e-commerce, growth was 3.0% – mainly due to high comparative values from the previous year. "Bechtle is operating from a position of strength. We are using the gradual improvement in the delivery situation to clear the project backlog that has arisen, resulting in strong revenue growth in a difficult overall economic environment. At the same time, we are doing everything we can to further strengthen Bechtle's future viability – for example, by investing in the further training of employees," explains Dr Thomas Olemotz, Chairman of the Executive Board of Bechtle AG.

Investment in employees

In the third quarter, Bechtle further expanded its initiatives concerning employee training and certification. The continuous development of expertise is what gives Bechtle an important competitive advantage, particularly in strategically important business areas, such as security, multi-cloud architectures and technologies. The significant increase in trainees, but also the further training and certification measures for existing employees as well as the innovative lateral entry programme are having an impact on productivity. "Particularly in times of transformation, it is important to invest in expertise in order to continue shaping the future with state-of-the-art IT solutions," says Dr Thomas Olemotz. 

EBT margin in line with forecast

In terms of the result, on the one hand, the cost savings resulting from COVID-19 – for example in travel costs – were largely eliminated in the reporting period, which led to a normalisation and thus an increase in the cost base compared to the previous year. Beyond that, inflation is also making itself felt with rising costs. On the other hand, Bechtle was able to realise positive price effects, especially in IT e-commerce. Overall, the Bechtle Group's EBT margin of 6.0% is at a very good level and is in line with the forecast for the full year. 

Cash flow shows clear positive trend

The operating cash flow of Bechtle AG continues to be characterised by the challenging general conditions. It was €-28.3 million in the third quarter. The supply situation, which is continuously improving, even if sluggishly in some areas, is the main reason for Bechtle's unchanged high inventory levels. Missing components for projects thus prevent the order being implemented at the customer's site. Moreover, the cash flow also reflects the extremely positive business performance. A revenue growth of almost 15% brings with it a high level of inventories and a correspondingly high level of receivables. Nevertheless, Bechtle achieved a further reduction of capital commitment in the third quarter – a development that should ensure noticeable improvements by the end of the year.

Optimistic outlook

Bechtle remains optimistic for the current fiscal year and confirms the forecast published in March of a significant increase in revenues and earnings with a simultaneously stable EBT margin. "Under normal conditions, the positive business performance in the first nine months would give us a very good opportunity to exceed our forecast. However, in view of the high uncertainties regarding the overall economic development, we are not changing the forecast, but still consider it realistic to achieve the targets. We are going into our year-end business full of confidence, with a highly motivated team, and are also expecting a very positive business performance for 2023," says Dr Thomas Olemotz.

Bechtle's key figures 3rd quarter and 9 months 2022

 ¹ Prior year adjusted (IFRS)

The quarterly statement for the third quarter of 2022 is available for download at bechtle.com/reports.