Brockhaus Technologies AG

Hello and welcome to the earnings call of ProcHouse Technologies regarding the half-year results 2024. At this time, all participants have been placed on a listen-only mode. The floor will be open for your questions following the presentation. Let me now turn the floor over to Marco ProcHouse.

Yeah, thank you and good afternoon, everyone. Welcome to ProcHouse Technologies earnings call for the first half of fiscal year 2024. Before we begin, I would like to point out that the slides we are presenting will afterwards be published in the Investors' Relations section of our website, brockhaus-technologies.com. After our presentation, we will open the call to questions from your side. To be fair to everyone, please limit yourself to one question plus one follow-up. Thank you very much in advance. Before we present our results, I encourage all listeners to review the legal notice on page two of our presentation, which explains the understanding of forward-looking statements. Additionally, please refer to note six of our annual report 2023 on page 94 onwards and page 15 onwards of our half-year financial report H1 2024 for a discussion on alternative performance measures as well as the reconciliation of the non-GAAP figures. For information on risk factors that could cause actual results to differ materially from forward-looking statements, we kindly refer you to the section on risk and opportunities in the Management Report 2023, starting on page 65. So let's go into the summary H1 2024. To give you a brief summary of what we have achieved in the first half of this year. First of all, we have an important announcement to share. We have rebranded our financial technology segment as HR Benefit and Mobility Platform. This change aligns with our strategic vision, especially in light of our recent acquisition of Probonio, an employee benefit software-as-a-service company, With this acquisition, bike leasing is taking a significant step forward and evolving into a comprehensive multi-benefit platform. This decision reflects our commitment to expanding our service offerings beyond bicycle leasing and delivering even greater value to our clients. We continue our success story in 2023 and confirm our annual forecast. The positive business development in the first half of the year highlights our highly profitable growth momentum of our technology group, despite unstable weather and general consumer reluctance in Q2 in the HR benefit and mobility platform segment, and a slower revenue realization in the security technology segment. We are particularly pleased with Bike Leasing's record new customer growth in the first half of the year, as well as the planned rollout of additional employee benefits through our software as a service company Probonio, which will provide further offerings beyond the existing Bike Leasing business in the second half of the year. Additionally, due to the high order backlog at IHSE, we are confident that we will see a strong catch-up in terms of revenue and earnings over the coming two quarters. WalkHouse Technologies generated revenues of €109 million in H1 2024, which represents organic growth of 30% compared to H1 of last year. Adjusted pro forma EBITDA grew by 19% to €38 million, corresponding to an adjusted pro forma EBITDA margin of 35%. Adjusted pro forma EBIT also increased by 20% to €36 million, corresponding to an adjusted EBIT margin of 33%. Before adjustments, EBITDA amounts to €36 million, and EBIT to 24 million euros. Have in mind that EBIT is especially influenced by PPA amortization. Against this backdrop, we confirm our group forecast 2024 with revenue between 220 and 240 million euros and an adjusted EBITDA between 80 and 19 million euros. The operating development in H1 as well as the growth forecast for the full year clearly underline the resilience of our business model, even in challenging economic and geopolitical times. Lastly, we reduce the group's net debt relative to the adjusted pro forma LTM EBITDA from 0.87 times at the end of 2023 to 0.74 times at the end of H1 2024. This equips us with significant non-dilutive financing capacity for acquisitions and future growth initiatives. But more on this later in the presentation. Coming to the next page on free cash flow development. The next chart illustrates the development of our free cash flow before tax over the past three years, which grew at an impressive CAGR of 105%, increasing from €11 million in 2021 to €44 million in 2023. The slightly negative free cash flow in H1 2023 was due to a significant refinancing backlog at bike leasing during the peak summer months, a situation that also exists this year but no longer presents a challenge. High bike volumes brokered at bike leasing during the summer typically lead to peak working capital requirements. Due to such peaks, we usually generate most cash flow in the second half of the year. This is nicely illustrated here if you compare the minus 100,000 euros in H1 2023 against the full year figure of more than 44 million euros of free cash flow. Let's come to the EPS development. On the income side, the strong performance across our business segments led to a doubling of adjusted performer EPS from 0.64% from 0.64 cents in 2022 to 1.29 euros in 2023, reflecting a compound annual growth rate of 77% between 2021 and 2023. This trend continued with a strong increase of 53% in adjusted performer EPS to 66 cents in H1 2023, compared to 43 cents in the same period last year. In addition to the operating increase of earnings, this was also driven by the ongoing repayment of the subordinate loan from the acquisition of life leasing.

Let's turn to revenue by quarter.