Release Date: August 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Brockhaus Technologies AG (XTER:BKHT, Financial) reported a strong organic revenue growth of 30% in H1 2024, reaching EUR109 million.
- The company achieved a record new customer growth for its Bikeleasing segment in the first half of the year.
- Adjusted pro forma EBITDA grew by 19% to EUR38 million, with a margin of 35%, indicating strong profitability.
- The acquisition of Probonio is expected to enhance the company's service offerings and contribute positively to EBITDA from 2025 onwards.
- The company's net debt relative to adjusted pro forma LTM EBITDA was reduced from 0.87 times at the end of 2023 to 0.74 times at the end of H1 2024, providing significant non-dilutive financing capacity for future growth initiatives.
Negative Points
- The Security Technology segment experienced slower revenue realization, impacting overall performance.
- IHSE's revenue dropped by 19% in the first six months of 2024 due to delayed project revenue recognition.
- The gross profit margin for Bikeleasing was slightly below last year's level, affected by increased revenue from lower-margin bike sales.
- The company faced challenges in the HR Benefit & Mobility Platform segment due to unstable weather and general consumer reluctance in Q2.
- The Americas region experienced a 27% decline in sales, primarily due to a large single order in the comparative period last year.
Q & A Highlights
Q: Could you clarify the expected penetration rate for Probonio in the upselling process and whether the 3% penetration is an intermediate goal or a final target? Also, how did July's weather affect bike leasing growth rates?
A: We expect the penetration rate for Probonio to be a continuous process rather than a final target. The 3% figure seems low, and we aim to onboard more corporate customers over time. Regarding July, we do not provide specific outlooks, and we don't have the rain data yet to comment on its impact on growth rates.
Q: What feedback did you receive from the Probonio trial with customers, and how do you plan to integrate and sell it to employees?
A: We received a range of feedback from positive to lukewarm. The guidance for Probonio's contribution reflects our survey results. We focus on winning corporate customers, as employees typically adopt the app once their company implements Probonio. We approach corporates through our sales team, email campaigns, and direct calls.
Q: How is the market evolving for potential acquisition targets, and are there any changes in valuation expectations?
A: We see some light at the end of the tunnel regarding valuation expectations aligning between buyers and sellers. We continue to look for innovation technology leaders with high margins and cash conversion ratios. The market shows potential for finding the next hidden champion.
Q: Have you noticed any changes in competitor behavior in the bike leasing industry, especially given the challenging demand environment?
A: There have been no significant changes in competitor behavior or leasing rates. We focus on onboarding new corporate customers, as they rarely churn once onboarded. Retailers are promoting company bicycle leasing more, which indirectly benefits us.
Q: Can you provide more details on the integration of Probonio and its expected impact on earnings?
A: The integration of Probonio involves harmonizing legal, accounting, and sales processes. We expect the integration to be completed soon, with a broad sales rollout planned for H2. While we don't expect earnings contributions in 2024, we anticipate a positive impact from 2025 onwards, with Probonio contributing mid-single-digit million euros to EBITDA.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
