Key Financials

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Double digit growth rates in 1H19 and steadily positive cash generation

Double-digit business expansion, mainly due to the acceleration of Sysbee and mCloud – i.e. the internal start-up and the newly acquired company respectively – together with a significant market consolidation in Slovenia thanks to the increasing focus on high-end solutions

Steadily positive cash generation (cash conversion ratio ranging from 70% to 90%), coming from the combination of:

  • Favorable working capital dynamics, specific of a SaaS company, as the group benefits from getting paid spot and delivering its services at sequent stages;
  • Low capital expenditures need, highlighting the scalability of DHH business model;

Absence of any cost’s capitalization, meaning EBITDA fully reflects operating profitability;

Positive Net Cash position (ca. €3mn), allowing further M&A transactions.

Ramp up continues in 2019E-20E

(Source for estimates: Value Track equity research report, 24 September 2019)

2019E-20E Gross Sales expected to experience a double-digit growth: +17% and +12% respectively;

Operating profitability to progressively increase, with EBITDA margin expected at 12.8% and 15.0% respectively in 2019E-20E on a pro-forma basis (gross of non-recurring and extraordinary costs: listing and M&A related costs or indirect costs linked to the parent company)

Cash conversion rate expected in the 70%-90% region

Summary of Financials

Income Statement (€'000)
2017A
2018A
2019E
2020E
Net Revenues
5,289
5,970
6,900
7,752
Other Revenues
387
337
31
37
Total Revenues
5,676
6,307
6,931
7,789
COGS
-3,413
-3,956
-4,333
-4,845
Labour cost
-1,732
-1,816
-2,068
-2,025
EBITDA
531
534
530
919
D&A
-181
-361
-220
-215
EBIT
350
173
310
704
Net Profit
245
103
221
499
Adjusted Net Profit
284
148
296
536
Pro-Forma results (€'000)(*)
2017A
2018A
2019E
2020E
Net Revenues P-F
5,670
6,163
6,931
7,789
EBITDA P-F
886
841
880
1,169
EBIT P-F
702
647
660
954
Net Profit P-F
534
526
484
684
Balance Sheet (€'000)
2017A
2018A
2019E
2020E
Net Fixed assets
6,243
6,171
6,076
6,011
Net Working Capital
-1,369
-1,172
-1,313
-1,427
Severance pay and other funds
22
15
39
46
Total Capital Employed
4,852
4,967
4,725
4,538
o/w Group Net Equity
7,333
7,571
7,799
8,298
Net Fin. Position
2,481
2,604
3,075
3,760
Key figures & Ratios
2017A
2018A
2019E
2020E
EBITDA Margin
10%
9%
8%
12%
EBIT Margin
7%
3%
5%
9%
Net Margin
5%
2%
3%
6%
ROE
3%
1%
3%
6%
ROCE b.t.
7%
4%
7%
16%
Net Debt / Equity
nm
nm
nm
nm
Net Debt / EBITDA (x)
nm
nm
nm
nm
OpFCF b.t. as % of EBITDA
118%
48%
104%
96%
P/E Adj. (x)
24.5x
13.9x
P/BV (x)
0.9x
0.8x
EV/Sales (x)
0.6x
0.5x
EV/EBITDA
8.2x
4.0x
Revenue YoY growth (%)
34%
13%
16%
10%
EBITDA YoY growth (%)
49%
1%
0%
74%
Net Profit YoY growth (%)
58%
-58%
nm
nm
Company data
Outstanding Shares (mn)
1.49
Market Price (€)
5.15
Fair Value (€)
10.0
Market Cap (€mn)
7.7
Cash Flow Statement (€'000)
2017A
2018A
2019E
2020E
EBITDA
531
534
530
919
Op. WC requirements
424
-196
141
115
Capex (not incl. Fin. Inv.)
-350
-92
-125
-150
Change in provisions
20
11
7
7
Cash Taxes
-58
-52
-74
-181
OpFCF a.t.
568
205
478
710
As a % of EBITDA
107%
38%
90%
77%
Capital Injections
0
115
0
0
Other (incl. Fin. Inv.)
-1,241
-176
7
-15
CF to serve debt/equity
-674
144
485
695
Net Financial Charges
-29
-21
-15
-10
Dividend paid
0
0
0
0
Change in Net Fin Position
-703
123
470
685
Net Fin. Position
2,481
2,604
3,075
3,760
Source: Company (historical figures), ValueTrack (2019E-20E estimates)