EQS-News: Brockhaus Technologies AG: High profitability and organic growth in 9M 2024 – forecast 2024 confirmed

Brockhaus Technologies AG: High profitability and organic growth in 9M 2024 – forecast 2024 confirmed

• Group revenue +23% to €175.3 million and adjusted EBITDA +25% to €68.0 million
• Free cash flow before taxes +60% to €26.2 million and adjusted earnings per share +12% to €1.42
• Bikeleasing continues its highly profitable growth; revenue +34% and adjusted EBITDA +27% above previous year
• IHSE with an expected strong Q3; order backlog at a high level of €8.3 million at the end of September, driven by newly met product standards for highly mission-critical environments
• Net debt in the group decreased compared to December 31, 2023, from 0.87x to 0.56x of adjusted pro forma LTM EBITDA
• Forecast for 2024 unchanged with revenue of €220 million – €240 million and adjusted EBITDA of €80 million – €90 million

Frankfurt/Main, November 14, 2024. Brockhaus Technologies AG (BKHT, ISIN: DE000A2GSU42) continues its highly profitable growth trajectory in the first nine months of fiscal year 2024. During the reporting period, the technology group achieved revenue of €175.3 million, representing organic growth of +22.9% compared to the same period last year (9M 2023: €142.7 million). Adjusted EBITDA increased by +25.0% to €68.0 million, with an adjusted EBITDA margin of 38.8% (9M 2023: €54.4 million; 38.1% margin). This was achieved despite higher personnel and other operating expenses to enable long-term growth. Adjusted EBIT increased by +25.5% to €64.2 million, reflecting an adjusted EBIT margin of 36.6% (9M 2023: €51.2 million; 35.9% margin). The group is thus on track to meet its full-year guidance, with revenue expected to grow to €220 million – €240 million (2023: €187 million) and adjusted EBITDA at €80 million – €90 million (2023: €62 million).

BKHT’s free cash flow before taxes increased significantly by +59.7% to €26.2 million (9M 2023: €16.4 million), primarily driven by Bikeleasing’s highly profitable business model. The increase in adjusted earnings per share by +12.1%, to €1.42 in 9M 2024 compared to previous year (9M 2023: €1.27), was primarily due to the gradual repayment of the subordinated acquisition loan and Bikeleasing’s strong operational performance.

Due to the acquisitions of four external sales agencies in the HR Benefit & Mobility Platform segment (Bikeleasing and Probonio) during the fiscal year 2023, the group also reports earnings for the same period in 9M 2023 on a pro forma basis for better comparability. As the acquisitions do not contribute to revenue but solely reduce costs, the pro forma results are higher with unchanged revenue levels. Compared to the pro forma figures, adjusted EBITDA in 9M 2024 increased by +15.7% to €68.0 million (9M 2023: €58.8 million; 41.2% margin) and adjusted EBIT rose by +15.7% to €64.2 million (9M 2023: €55.5 million; 38.9% margin).

Before adjustments, EBITDA amounted to €63.5 million (9M 2023: €53.5 million) and EBIT to €45.6 million (9M 2023: €38.7 million). EBIT is particularly affected by purely consolidation-related PPA amortization.

“The strong results for the first nine months of fiscal year 2024 once again highlight that our business model enables significant revenue growth and very high profitability, even in economically challenging times. Bikeleasing continues to perform exceptionally well and IHSE has started the second half of the year strongly as expected. Based on this, we are confirming our 2024 annual forecast of revenue growth to €220 million to €240 million and adjusted EBITDA of €80 million to €90 million, despite numerous economic and political uncertainties. Looking ahead to our medium-term target for 2025, which we communicated back in June 2023, we remain optimistic based on the strong fundamental development of our subsidiaries,” commented CEO Marco Brockhaus.

As of September 30, 2024, BKHT had high cash and cash equivalents of €44.6 million, which can be used, for example, to finance future growth, as seen in the second quarter with the acquisition of Probonio by Bikeleasing, or for other strategic options. Bikeleasing distributed €28.0 million to its shareholders in the reporting period. Of this amount, €15.3 million was allocated to the intermediate holding company BCM Erste Beteiligungs GmbH, which is controlled by Brockhaus Technologies AG, and was subsequently used for the further repayment of the subordinated acquisition loan that was utilized as part of the acquisition of Bikeleasing in 2021.

The group's net debt relative to adjusted pro forma EBITDA for the last twelve months was significantly reduced in the reporting period, from 0.87x at the end of 2023 to 0.56x. As of September 30, 2024, the group's net debt was €42.4 million, significantly lower than the €58.5 million at the end of the fiscal year 2023.

Bikeleasing continues its highly profitable growth

Bikeleasing (HR Benefit & Mobility Platform segment) continues its dynamic and highly profitable growth trajectory. Revenue increased by +33.5% to €151.1 million in the first nine months of the fiscal year 2024 (9M 2023: €113.2 million). As of September 30, 2024, the number of companies connected to the digital Bikeleasing platform was around 70,000, reflecting a growth of +25.6% over the past twelve months. Bikeleasing’s corporate customers employed around 3.7 million employees as of the reporting date. The number of new bikes brokered through the digital Bikeleasing platform in 9M 2024 was around 123,000 units, representing a decrease of -5.7% compared to the same period previous year (9M 2023: 131,000 units). In addition to weather-related factors and general consumer reluctance, the reduced number of brokered bikes was significantly influenced by two additional factors. First, the transition of existing customers to a variable leasing rate continues, with around 90% of connected employees now migrated to the new system. However, customers with around 10% of the connected employees have still not agreed to the new contract system, which has led to a slowdown in new orders but also to a significantly higher margin per contract. Additionally, credit downgrades of some corporate clients due to economic conditions led Bikeleasing to reject an unusually high number of requests from both existing and new customers in order to maintain a consistently high quality of receivables. While this impacted new orders, it is intended to sustain Bikeleasing’s historically very low customer default rate, which has remained well below 1%.

Despite that, the significant increase in revenue was mainly driven by the successful ongoing transition of both existing and new customers to a variable leasing rate (monthly lease payment relative to the purchase cost of the bike). Due to the adjustment of the leasing rate to the higher interest rate environment, the average profit per newly brokered bike increased compared to the same period last year. As a result, the earnings per bike grew by +42.6% compared to 9M 2023.

The adjusted pro forma EBITDA of the segment was significantly increased to €70.6 million (9M 2023: €55.5 million). The gross profit margin remained at a consistently high level of 67.0%, though slightly lower than the previous year (9M 2023: 68.2%). This was mainly due to the higher revenue share from resale proceeds, which have a positive but significantly lower gross profit margin compared to the other revenue components of the segment. The adjusted EBITDA margin remains very high at 46.7%, but was below last year's record level (9M 2023: 49.0%) due to the slightly lower gross profit margin and growth-related increases in personnel and other operating expenses. This is partly due to the acquisition of Probonio, as well as the founding of Bike2Future for the marketing and brokerage of used bikes through B2B and B2C channels, along with the associated growth initiatives.

For the coming years, Bikeleasing continues to expect a sustained positive development, driven in part by an improved market penetration with a steadily increasing number of corporate clients, higher usage rates among existing clients and the international expansion of the business beyond Germany and Austria. Additionally, with the acquisition of Probonio, the platform will soon offer not only company bikes but also other employee benefits. Initial sales initiatives were already launched in late August with a selected group of Bikeleasing customers. For fiscal year 2025, indications based on a pilot customer survey already suggest a realistic positive EBITDA contribution in the mid-single-digit million range.

IHSE with an expected strong Q3

In the Security Technologies segment (IHSE), revenue for the reporting period amounted to €24.2 million, down by -17.8% compared to the same period previous year (9M 2023: €29.5 million), despite a significant increase in revenue in the third quarter (€10.0 million). The main reasons for this decline were business-related fluctuations in project activity and an exceptionally strong comparative period in 9M 2023, during which the largest single order in the company’s history, valued at over €8 million, was realized in the Americas region. As a result, revenue in the Americas was significantly below the previous year’s level. In EMEA, business grew by +22.2% compared to the prior year, and in APAC, revenue saw strong growth of +92.7%.

As of September 30, 2024, the order backlog remained at a high level of €8.3 million (December 31, 2023: €4.6 million), as IHSE was able to particularly secure those projects related to the implementation of new security standards for highly mission-critical environments. The gross profit margin remained stable at 74.3% (9M 2023: 74.7%), highlighting IHSE's pricing power. The adjusted EBITDA for the reporting period amounted to €3.2 million, with an adjusted EBITDA margin of 13.2%, which was below the same period last year (9M 2023: €7.8 million; 26.4% margin). This was primarily due to the lower revenue level in 9M 2024, where no corresponding cost reduction occurred due to fixed costs in personnel and other operating expenses. Management expects this effect to moderate over the course of the year, with the adjusted EBITDA margin projected to be at a significantly higher level.

Strong and highly profitable growth expected for the full year 2024: revenue forecast to increase to €220 million – €240 million, with adjusted EBITDA of €80 million – €90 million

Given the positive business development in the first nine months of fiscal year 2024, the management of Brockhaus Technologies AG confirms its forecast for the 2024 fiscal year, despite ongoing geopolitical and economic uncertainties. Revenue is still expected to grow between +18% and +29%, reaching €220 million – €240 million, with adjusted EBITDA projected at €80 million – €90 million (growth between +29% and +45%).

For the 9M 2024 financial report 2024 and more information about the company, please visit: https://ir.brockhaus-technologies.com/websites/brockhaustechnologies/English/3000/publications.html

The earnings call for the first nine month of 2024 in English will take place today, November 14, 2024, at 4:00 p.m. (CET). Interested parties can register for the call using the following link: https://webcast.meetyoo.de/reg/H4sQBwhSFc83

About Brockhaus Technologies

Based in Frankfurt am Main, Brockhaus Technologies AG (BKHT, ISIN: DE000A2GSU42) is a technology group that acquires high-margin, high-growth technology and innovations champions with B2B business models in the German Mittelstand. With a unique platform approach and a long-term horizon, Brockhaus Technologies actively and strategically supports its subsidiaries in achieving profitable long-term growth, both across industries and internationally. At the same time, Brockhaus Technologies offers a gateway into these non-listed German technology champions, which are otherwise inaccessible to capital market investors. For more information, please visit: https://www.brockhaus-technologies.com/en/

Contact information

For Investors: 
Florian Peter 
Phone: +49 69 20 43 40 976 
Fax: +49 69 20 43 40 971 
E-Mail: ir@brockhaus-technologies.com 

For media:
GFD - Gesellschaft für Finanzkommunikation
Phone: +49 69 97 12 47 33
Fax: +49 69 97 12 47 20
E-Mail: dietz@gfd-finanzkommunikation.de

Consolidated key figures for the first nine months 2024*

* For the definition of the alternative performance measures, please refer to page 94 onwards of our Annual Report 2023 and page 14 onwards of our Quarterly Statement 9M 2024.