adesso SE Company Presentation, November 2020
2 11/2020 adesso SE Partner in digital transformation adesso optimises the core business processes of companies by IT-Consulting, developing individual software and industry solutions.
3 11/2020 adesso SE Our philosophy
4 11/2020 adesso SE Success factors and growth Group sales 2019 more than 4,471 EUR 449.7 million employees Expected sales in 2020 adesso Group > EUR 500 million as at 30 September 2020 Constantly profitable Cash at year-end 2019 EUR 46 million Awards as an employer
5 11/2020 adesso SE Our Portfolio >>> business IT-Services (about 80 % of Sales) Business Software IT Consulting IT Management Consulting Development Strategy > Process Process > Architecture Architecture > Application Application > Operation IT-Solutions (about 20 % of Sales) Industry Content Solutions Mobile Solutions Solutions technology <<<
6 11/2020 adesso SE Equity Story Premium positioning adesso will expand to form one of the leading integrated IT companies for sector-specific business processes in central Europe adesso has an ambitious growth strategy and aims to grow by at least twice the rate of the market (plus M&A) adesso aims to have an operating margin above the sector average adesso pays out a dividend and aims to raise it continuously
7 11/2020 adesso SE Growth Model Tried-and-tested model for expanding sector-wide presence Transfer of model to new sectors: CONSULTING DEVELOPMENT SOLUTIONS Start a new core sector every 2-3 years INSURANCE Ramp-up-phase: Automotive BANKS HEALTH Start 2019: Manufacturing LOTTERY Regional expansion PUPLIC AUTHORITIES AUTOMOTIVE Creation of new technology areas MANUFACTURING INDUSTRY Creation of a product & solutions portfolio
8 11/2020 adesso SE Geographic Expansion | DACH New offices in Germany and Switzerland Bonn STRALSUND NEUMÜNSTER Leipzig ROSTOCK HAMBURG Potsdam BREMEN BERLIN HANNOVER Walldorf POTSDAM Lugano MUENSTER ESSEN LEIPZIG DORTMUND DUSSELDORF COLOGNE JENA AACHEN MUCH BONN FRANKFURT WALLDORF NUREMBERG KARLSRUHE STUTTGART REUTLINGEN VIENNA MUNICH BASEL ZURICH BERN LAUSANNE LUGANO
9 11/2020 adesso SE Geographic Expansion | International New international offices Budapest Madrid Amsterdam Nieuwegein (Utrecht) BOSTON LONDON AMSTERDAM NIEUWEGEIN BUDAPEST SOFIA ISTANBUL BARCELONA MADRID JEREZ DE LA FRONTERA
10 11/2020 adesso SE Business Model INNOVATION GROWTH MARGIN EPS / DIVIDEND Grow each sector Utilisation Portfolio expansion Enter new sectors Daily rates New business models Product business Project efficiency International business License & Maintenance Recruiting Costs / changes per FTE - Personnel to daily rates M&A - Travel & offices
11 11/2020 adesso SE adesso insurance solutions / in|sure Ecosphere Business Driver for growth and visibility in the insurance market Profit & Margin Driver Licences Maintenance Implementation services Building up a ramp of maintenance contracts International Business in later stage
12 11/2020 adesso SE adesso banking solutions (JV) – New core banking system provider Joint Venture (50/50) with Asseco Poland Market entry as a new core banking system provider for German-speaking countries in preparation Leading European software producer Asseco contributes its ultra-modern “Asseco Banking Suite”, proven at numerous European banks Enhancement and localization of product on the extensive knowledge of adesso’s banking unit First adesso Banking customers show high interest Next step in strategy of supplementing adesso’s IT services business with industry-specific standard solutions and products
13 11/2020 adesso SE Strong growth in sales and operating profit / IFRS 16 effect on EBITDA Drivers Sales adesso Germany up 17 % Other contries up 33 % 23 % growth in headcount (dilution Turkey, Bulgaria, Spain) EBITDA One time IFRS-16-effect of EUR 12 m Strong licence sales Weaker utilisation in first half- year with strong recovery in Q4/2019 Austria, Bulgaria, Turkey and Switzerland profitable (Spain < 0)
14 11/2020 adesso SE adesso playbook 2020 Manage the Uncertainty of the Corona-Crisis Strengthen utilisation and profitability Establish Corporate Account Management Further licence sale with in|sure and new modules Continued investments into products Strengthen efforts around new industry solutions Grow Hungary and Netherlands Support regional and portfolio expansion M&A-transaction
15 11/2020 adesso SE Update 9M 2020
16 11/2020 adesso SE Sales growth of 17 % despite COVID19-pandemic Sales 17 % total sales growth Germany up 15 % Other contries up 23 % Sales drivers Health, Public & Manufacturing 13 % growth in headcount Germany up 11 % Other countries 24 %
17 11/2020 adesso SE Sales split 9M 2020 (1) Sales by industry in EUR m 9M 2020 Δ yoy Recap 2019 Insurance 71.4 - 1 % + 37 % Banking 65.4 0 % + 1 % Health 41.7 + 40 % + 1 % Public 54.3 + 47 % + 40 % Automotive * 17.1 - 3 % + 112 % Manufacturing * 21.5 + 139 % - 112.5 + 17 % Cross Industries * + 8 % ** * Sales of customers Bosch and SBB have been reallocated in 2020. Bosch now contributes to Manufacturing (previously: Cross Industries) and SBB now contributes to Cross Industries (previously: Automotive). Comparative figures (yoy) have been adapted. ** including Manufacturing
18 11/2020 adesso SE Sales split 9M 2020 (2) Sales by region in EUR m 9M 2020 Δ yoy Recap 2019 Germany 303.6 + 15 % + 17 % Switzerland 54.1 + 21 % + 24 % Austria 7.6 + 23 % + 20 % Turkey 8.2 + 29 % + 52 % Other 10.3 + 99 % + 103 %
19 11/2020 adesso SE Growth in operating profit EBITDA by 63 % Operating Profit Q1 2020 good utilisation and booking intensity Q2 2020 corona effects with lower utilisation but savings of travel expenses Q3 2020 utilisation and booking intensity picked up again in|sure license deals plus cost savings Overall the 9M-EBITDA grew by 63 % year-on- year
20 11/2020 adesso SE EBITDA increases more than sales due to OOE savings Key Figures in EUR m 9M 2020 9M 2019 Δ yoy Employees (FTE, avg.) 4,249 3,634 + 17 % Sales 383.9 327.2 + 17 % Gross Profit 339.3 289.9 + 17 % Personnel costs 256.4 217.3 + 18 % Other operating expenses 41.9 48.2 - 13 % EBITDA 47.1 28.9 + 63 % EBITDA-margin (%) 12.3 8.8 Profit drivers 9M 2020 Utilisation & projects D / AT / CH / T Daily rates Stable License & Maintenance in|sure / FirstSpirit Personnel cost per FTE 1 %
21 11/2020 adesso SE Tax quota on normal level leads to 183 %-increase of EPS Key figures in EUR m 9M 2020 9M 2019 Δ yoy EBITDA 47.1 28.9 + 63 % Depreciation plant & equipment - 17.4 - 14.3 + 22 % Depreciation ppa - 1.7 - 2.1 - 19 % Depreciation goodwill 0.0 0.0 - Income from investments - 0.2 - 0.4 Financial result - 1.8 - 1.6 + 11 % EBT 26.1 10.6 + 146 % Income taxes - 8.5 - 4.3 Consolidated earnings 17.6 6.2 182 % Earnings per share (€) 2.86 1.01 183 % Tax quota 32 % 41 %
22 11/2020 adesso SE Balance sheet and financial KPIs Key figures in EUR m 30.09.2020 30.09.2019 Δ yoy Cash 1) 32.0 34.2 - 2.2 Financial debt 1) 46.2 60.9 - 14.7 Net-Cash 1) -14.2 -26.7 + 12.5 Operating Cash-Flow 22.6 1.6 + 21.1 Working Capital 2) 108.1 90.9 + 19 % Investment Cash-Flow -10.6 -12.9 + 2.3 Goodwill 49.8 48.6 + 1.2 Equity 106.8 81.8 + 25.0 Equity ratio 31.2 % 25.6 % + 5.6 pp 1) Decreased financial debt leads to improved debt-equity-ratio 2) Increased position of contract assets due to more fixed price projects
23 11/2020 adesso SE Guidance 2020 raised after strong Q3-figures HY1 within expectations / Strong Q3 leads to raise of guidance / Q4: promising but new corona-risks Q1 with good start due to good utilisation and booking intensity Weaker Q2 (due to corona-pandemic) and no in|sure license deals, saved travel expenses Strong Q3: utilisation picking up, highest number of working days, cost savings continue in|sure license deals VAT reduction is an incentive for clients to start digitalisation projects; continued in Q4 Comparably high number of working days with some risks due to new partial-lockdown; good chances to close some more license sales % of Guidance Guidance IFRS 9M 2019 9M 2020 raised 2020 2020 in EUR m Guidance (raised) (previous) Sales 327.2 383.9 77 % > 500.0 > 490.0 EBITDA 28.9 47.1 72 - 86 % 55.0 – 65.0 > 50.0 EBITDA-margin 8.8 % 12.3 % >10.0 %
24 11/2020 adesso SE adesso business model proves to be quite resilient against corona crisis Negative impacts due to corona pandemic Lower utilisation in Q2 – countermeasures: short-time work More volatile cash situation due to some customers in distressed situations Countermeasures: Tax deferrals Additional bank lines Increased receivables management Project cancellations or postponements in a few cases Corona-pandemic has some positive impact Saved expenses (travel, events) Importance of digitalisation is underlined in the corona crisis adesso core sectors less affected by the crisis (Banking, Insurance, Health, Public) VAT reduction incentivises adesso customers to start digitalisation projects
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