Bechtle : Reports Strong First Quarter

Neckarsulm, 8 May 2020 - Bechtle AG has made a very good start to 2020. As a result of the Covid-19 pandemic, the framework conditions have been very bad especially since March. Nevertheless, the IT company was able to boost its revenue in the first quarter of 2020 by 9.3 per cent to €1,355.7 million. Earnings before taxes (EBT) even underwent disproportionately high growth of 13.4 per cent to €51.1 million. The EBT margin thus improved to 3.8 per cent. As of 31 March 2020, Bechtle had 11,768 employees, an increase of 1,434 or 13.9 per cent.

In Germany, the revenue growth reached a remarkable 10.6 per cent. Though faced with some even more drastic measures to control the spread of Covid-19, the locations abroad achieved revenue growth of 7.3 per cent. The group's organic revenue growth amounted to 8.2 per cent. 'In the first quarter, we already struggled with the negative impact of the pandemic. Many projects were postponed, some vendors had supply difficulties, and our employees' work at the customer locations was much more difficult. On the other hand, we noticed a significant surge in demand in the industry and from our public-sector clients, especially for home office equipment and technical solutions for the implementation of virtual collaboration setups,' explains Dr Thomas Olemotz, Chairman of the Executive Board of Bechtle AG.

Above-Average Earnings Growth in System House Business

In the IT System House & Managed Services segment, Bechtle increased its revenue in the first three months of 2020 by 9.8 per cent to €859.1 million. The organic growth rate was 8.1 per cent. Both the project business with modern IT architectures - a key precondition for the digital transformation - and the business with cloud managed services contributed to the profitable growth. Additional momentum was generated by the higher demand for the equipment and operation of home office and collaboration solutions. Accordingly, EBIT went up 23.2 per cent to €32.5 million. The EBIT margin rose from 3.4 per cent to 3.8 per cent.

E-Commerce Especially Strong in Germany

In the IT E-Commerce segment, the revenue in the first quarter of 2020 grew 8.5 per cent to €496.6 million. At 20.4 per cent, the growth in Germany was particularly strong. This especially reflected the high demand for home office equipment. Due to impairment recognised under consideration of the expected economic consequences of the Covid-19 pandemic, EBIT merely increased 1.2 per cent to €20.1 million. The margin declined from 4.3 per cent to 4.1 per cent.

Cash Positions Up

In the first quarter of 2020, the operating cash flow of Bechtle AG performed very well, climbing to €22.8 million (previous year: -€22.1 million). Bechtle AG has also further optimised its working capital. At €636.9 million, this item remained below the figure of 31 December 2019 despite the strong growth. The total liquidity is at a very comfortable level of €285.1 million.

Targets Confirmed Despite Major Uncertainty

The consequences of the Covid-19 pandemic are looming massively over the further development of the macroeconomic framework conditions, which is thus more uncertain than ever. However, owing to the positive performance in the first quarter and the expectation that the framework conditions will return to normal in the course of the year, Bechtle confirms its revenue and earnings growth target of at least 5 per cent, respectively, which the company had published in March. 'Though a reliable forecast is presently impossible and we expected a rather reluctant second quarter, we are sticking to our goals for this year. Currently, we believe that our business will move on under increasingly normalised framework conditions in the course of the third quarter. Despite the consequences of the coronavirus pandemic, Bechtle's medium to long-term outlook remains positive in view of the ongoing digitisation,' says Dr Thomas Olemotz.

Bechtle KPIs for the First Quarter of 2020

		Q1/2020	Q1/2019	+/-
Revenue	€k	1,355,674	1,239,948	+9.3%
Domestic	€k	828,748	749,079	+10.6%
Abroad	€k	526,926	490,869	+7.3%
IT System House	€k	859,116	782,219	+9.8%
IT E-Commerce	€k	496,558	457,729	+8.5%
EBIT	€k	52,627	46,278	+13.7%
IT System House	€k	32,489	26,370	+23.2%
IT E-Commerce	€k	20,138	19,908	+1.2%
EBIT margin	%	3.9	3.7
EBT	€k	51,055	45,006	+13.4%
EBT margin	%	3.8	3.6
Earnings after taxes	€k	36,468	31,677	+15.1%
Earnings per share	€	0.87	0.75	+15.1%
Cash flow from operating activities	€k	22,757	-22,112	+202.9%
Number of employees (as of 31 March)		11,768	10,334	+13.9%

		31.3.2020	31.12.2019	+/-
Liquidity*	€k	285,060	272,197	+4.7%
Equity ratio	%	43.0	42.4

^* Incl. time deposits and securities