BUY
|
Original-Research: q.beyond AG - from NuWays AG
Classification of NuWays AG to q.beyond AG
Q1’25e set for further profitability improvements Topic: Next Tuesday, q.beyond is going to release its Q1 report, which is seen to show further improvements on the bottom-line and provide confidence regarding the company’s FY25 outlook. In detail: Q1 sales are seen to slightly decline by 1.4% to € 46.5m (eNuW). Yet, the expected decline is solely due to accounting in accordance with IFRS 15. As a result, a total of € 12.6m of FY24 sales, which are mainly related to SAP and Microsoft contracts, will no longer be accounted as revenues, as only the profits from the respective customer relationshops will be accounted for. Eliminating this effect, sales growth should be in the low to mid single-digit % range (eNuW). This should again be driven by Managed Services, but also a recovery of Consulting. Here we expect a significant improvement on the gross margin side to 12% (+3.6pp yoy). Overall gross margin is seen to come in at 19.3%, implying € 9.0m gross profit. Q1 EBITDA is expected to improve strongly by 27.6% to € 2.5m (eNuW), implying a 5.5% margin. Main drivers behind this should be again an improved near- and off-shoring ratio, which management aims to lift to 20% by YE’25 (14% as of FY24). This alone should explain a good part of the gross margin improvement. Moreover, the anticipated recovery of Consulting is seen to be a further driver. Given an improved utilization, margins in the region of 20% should be absolutely achievable going forward. With this, the company should be well on track to achieve the FY25 guidance. While the sales outlook looks conservative, implying 2.2-5.6% growth (excluding the aforementioned accounting effect; eNuW: +5.5%), the q.beyond should be able to achieve the upper end of the communicated EBITDA target of € 12-15m (eNuW: € 14.7m), as we expect gradual improvements as well as a seasonally strong Q4. Putting all this aside, inorganic growth is likely to become a factor as well, as implied by CEO Rixen during the latest conference calls. In fact, with € 30m net cash (incl. leases) management has a well equipped war chest on hand to tap the M&A market. Here, we regard targets with a high public sector exposure (health-care, energy, defense) as likely, given the recent infrastructure special funds and the debt break suspension in Germany. Reiterate BUY with an € 1.30 PT based on DCF. You can download the research here: http://www.more-ir.de/d/32508.pdf For additional information visit our website: https://www.nuways-ag.com/research-feed Contact for questions: NuWays AG - Equity Research Web: www.nuways-ag.com Email: research@nuways-ag.com LinkedIn: https://www.linkedin.com/company/nuwaysag Adresse: Mittelweg 16-17, 20148 Hamburg, Germany ++++++++++ Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte. Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse. ++++++++++
The EQS Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. |
||||||||||||||||||||
2132716 08.05.2025 CET/CEST
P R O D U C T S U G G E S T I O N S
The information presented here has been provided by our content partner EQS-Group. The originator of the news is the respective issuer, the company relating to the news, a publication service provider (press or information agency) which uses the distribution service of EQS to transmit company news to shareholders, investors, investors or interested parties. The original publications and other company-relevant information can be found at eqs-news.com.
The information you can access does not constitute investment advice. The presentation of our cooperation partners, where the implementation of investment decisions would be possible depending on the individual risk profile, is solely at the discretion of the person using the service. We only present companies of which we are convinced that the range of services and customer service will satisfy discerning investors.
If you are considering leverage products, familiarise yourself with the typical characteristics of the financial instruments beforehand. Take the time to determine the risk content of the planned investment before making an investment decision. Bear in mind that a total loss cannot be ruled out with leverage products.
For newcomers to the subject, we offer various options in both the training and the tools section, through which you can train theoretical knowledge and practical experience and thus improve your skills. The offer ranges from participation in webinars to personal mentoring. The range is continuously being expanded.
1 Lab features are usually functionalities that emerge from the think tank of the investor community. In the early stages, these are experimental functionalities whose development process is largely determined by use and the resulting feedback from the community. When integrating external services or functionalities, the functionality can only be guaranteed to the extent that the individual process elements, such as interfaces, interact with each other.