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    DPA   NL0009197771

DPA GROUP N.V.

(DPA)
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DPA N : DPA delivers solid results despite clear drop in revenue in H1 2021

08/19/2021 | 05:34am EDT

DPA delivers solid results despite clear drop in revenue in H1 2021

DPA delivers solid results despite clear drop in revenue in H1 2021

Highlights of first half year:

  • Revenue: 64.4 million euro (H1 2020: 71.4 million) due to a decreasing number of professionals (-11%)
  • Gross profit/gross margin: 21.1 million euro; 33.3% (H1 2020: 20.3 million; 28.4%)
  • Cost base was low in H1 2021 due to an explicit focus on cost control in 2020
  • Further increase in labour market tightness; significant investments needed to attract new professionals
  • EBITDA/EBITDA margin: 10.1 million euro; 15.9% (H1 2020: 8.6 million; 12.1%)
  • One-offtransaction costs: negative impact of 1.1 million euro on EBITDA
  • Lower travel and transport costs than in 2020: positive impact of 0.6 million euro on EBITDA, primarily realised in Q1 2021
  • Number of working days equal to H1 2020 (124)

Condensed income statement1

H1 2021

H1 2020

in millions of euro or percentages

Net revenue

63.4

71.4

Cost of sales

42.3

51.1

Gross profit

21.1

20.3

Gross margin

33.3%

28.4%

Selling, general and administrative expenses excluding

depreciation, amortisation and impairments

11.0

11.7

EBITDA

10.1

8.6

EBITDA margin

15.9%

12.1%

Depreciation and amortisation

-3.2

-11.3

Operating result (EBIT)

6.9

-2.7

EBIT margin

10.8%

-3.8%

Financial income and expenses

-0.2

-0.2

Result of associates

0.0

0.0

Profit before tax

6.7

-2.9

Tax on profit

-1.7

-1.1

Net profit/loss

5.0

-4.0

1. The results for the first six months of 2020 and 2021 have not been audited.

Commenting on the half-yearresults, DPA CEO Arnold van Mameren said: "There are two sides to these figures. On the one hand DPA showed that it is able to achieve solid financial results in a very challenging labour market. Demand for DPA professionals remains high and also results in great new projects. The Legal & Public cluster posted nice growth due to the allowances project for the Dutch tax authority

(Belastingdienst) and the TOZO scheme projects for municipalities. The Banking cluster, on the other hand, has had to deal with a very challenging banking sector that is seeing a shift from the demand from junior to mid-level/senior professionals. This group of professionals is even scarcer than the more junior professionals.

On the other hand, we are noticing the structural tightening of the labour market, mainly driven by the increasing shortage of specialised, highly educated professionals. Further investments are needed in our internal organisation and in marketing in order to grow in the second half of the year. DPA will continue to invest in the organisation and competencies of our employees with a view to attracting and retaining good professionals."

Development of first-half 2021 results

Revenue fell by 11.2% in the first half of 2021 to 63.4 million euro (H1 2020: 71.4 million

euro). Direct costs fell by 17.2% to 42.3 million euro (H1 2020: 51.1 million). Gross profit

increased by 3.9% to 21.1 million euro (H1 2020: 20.3 million). The gross margin rose from 28.4% in the first half of 2020 to 33.3% in the first half of 2021.

The number of professionals under contract fell sharply: from 1,092 at 30 June 2020 to 973 at 30 June 2021.

Selling, general and administrative expenses decreased by 6.0% to 11.0 million euro (H1 2020: 11.7 million). As a percentage of revenue, these costs rose to 17.4% (H1 2020: 16.4%). Part of these selling, general and administrative expenses are transaction costs of

1.1 million euro related to Gilde's public offer for all outstanding DPA shares. The profit margin is good due to a lower cost base as a result of cost cuts initiated in 2020 and a 0.6 million euro reduction in fuel, travel and accommodation expenses for professionals compared to the first half of 2020. Most of this was realised in the first quarter as the effects of the COVID-19 pandemic only began to be felt in March 2020. In the first half of 2020 EBITDA was negatively affected by the restructuring costs of 1.1 million euro due to the pandemic. EBITDA increased to 10.1 million euro in the first half of the year (H1 2020: 8.6 million), while the EBITDA margin rose to 15.9% (H1 2020: 12.1%).

Segment breakdown

For reporting purposes the six DPA clusters are combined into three segments:

  • Finance & Banking with the Finance and Banking clusters
  • Legal & Public with the Legal & Public cluster
  • IT, Supply Chain & Logistics & Participations with the IT, Supply Chain & Logistics and Participations clusters

Revenue and gross profit by

H1 2021

H1 2020

segment

In millions of euro and %

Gross

Margin

Gross

Margin

Revenue profit

% Revenue

profit

%

Finance & Banking

34.2

10.2

29.8%

41.5

11.7

28.1%

Legal & Public

14.0

6.4

45.6%

10.6

4.0

37.8%

IT, Supply Chain & Logistics &

Participations

15.2

4.6

30.1%

19.4

4.6

23.8%

Total

63.4

21.1

33.3%

71.4

20.3

28.4%

Financial position

The net cash flow from operating activities amounted to a positive 6.5 million euro (H1 2020: positive 17.3 million). It should be noted that the government support received in 2020 (which was repaid in August 2020), amounting to approximately 8 million euro, had a major one-off impact on the first half of 2020.

Days sales outstanding (average accounts receivable in days) equalled 28 at 30 June 2021 (30 June 2020: 25). The overall debtor position and sales yet to be invoiced stood at

22.0 million euro (30 June 2020: 22.0 million). The net cash flow from investment activities amounted to a negative 2.5 million euro (H1 2020: positive 0.4 million). The net cash flow from financing activities was a negative 2.9 million euro (H1 2020: 8.0 million negative). This difference is partly caused by the repayment of the long-term loans and the current account credit facility in the first half of 2020.

The net debt position stood at 3.2 million euro (30 June 2020: 4.1 million euro).

DPA had two financing agreements with Rabobank at 30 June 2021- a credit facility and an acquisition financing agreement. The credit facility is for a maximum of 25.0 million euro. The permitted maximum amount is determined based on the balance of 70% of the total amount of 'revenue yet to be billed' plus 70% of the total amount of legally pledged claims. The acquisition financing had already been repaid in full at the end of 2021 (30 June 2020: 1.2 million euro).

Employees

After the decline in the number of professionals in 2020 due to the COVID-19 pandemic, the current tight labour market is now causing the number of professionals to stabilise in 2021. It is a challenge to achieve further growth. At 30 June 2021 DPA had 973 professionals (30 June 2020: 1,092) and 142 internal employees (30 June 2020: 160) under contract. An important ratio is the ratio of direct/indirect staff (professionals under contract/internal employees). This ratio fell from 7.1 at 31 March 2021 to 6.9 at 30 June 2021. At 30 June 2021 DPA had 144 self-employed professionals under contract on a full-time basis (30 June 2020: 160).

(on an FTE basis)

30-6-2020

30-9-2020

31-12-2020

31-3-2021

30-6-2021

Professionals

1,092

1,014

982

987

973

Self-employed

160

professionals

160

159

143

144

Internal employees

160

143

132

139

142

Because DPA deploys its employees as flexibly as possible and demand for professionals is high, only a limited number of them were left 'on the bench' and productivity remained high. At the same time DPA continues to work on developing its professionals through personal coaching, courses and training. Due to unprecedented scarcity in the labour market, further investment is needed to be able to grow again.

Outlook

DPA continues to monitor market developments closely. Current shortages in the labour market mean that DPA will have to invest heavily in order to continue to meet the high demand from our clients for our professionals.

Post balance sheet events

On 27 July 2021 DPA was provided with a new current account financing facility for up to 2.5 million euro.

On 30 July 2021 DPA expanded its stakes in DPA Supply Chain, DPA Privacy and DPA Tax to 100% by exercising call options. DPA already had decisive control over these subsidiaries, which meant that they were already consolidated.

Public offer by New Horizons

On 1 March 2021 DPA and Gilde Equity Management Benelux Partners B.V. (Gilde) jointly announced that they agreed on a recommended public offer, with committed financing, by an entity of Gilde for all issued and outstanding ordinary shares of DPA at an offer price of

1.70 euro (cum dividend) per share in cash. Following the post-acceptance period New Horizons Holding B.V. holds 93.0% of the issued and outstanding capital, i.e. 43,679,894 shares.

DPA Group N.V.

DPA connects organisations with professionals who have the right knowledge and know- how. Under thes motto 'improving your performance' the company gives its employees room to be driven about their profession and continuously work on their professional and personal development. This enables them to help clients realise improvements and innovations. DPA is listed on Euronext Amsterdam. Further information can be found

at www.dpa.nl

Further information

For more information please contact Sharon Hulkenberg at sharon.hulkenberg@dpa.nlor on +31 (0)6 5141 1647.

Disclaimer

This press release contains forward-looking statements about future events. The press release is a reflection of the plans, objectives and ambitions of DPA based on the current insights and assumptions of the Management Board. Such statements are not established facts and are subject to known and unknown risks, uncertainties and other factors, many of which may be beyond DPA's control. As a result, actual results or developments may differ

materially from future results or developments either implied or expressly stated in the forward-looking statements. DPA does not assume any obligation to update or revise any information in light of changes in policy, developments, expectations, etc. This press release may contain 'inside information', as defined in Article 7 of the Market Abuse Regulation (EU) No 596/2014.

Attachment

Disclaimer

DPA Group NV published this content on 19 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 August 2021 09:33:04 UTC.


© Publicnow 2021
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Financials
Sales 2020 135 M 157 M 157 M
Net income 2020 1,62 M 1,88 M 1,88 M
Net Debt 2020 6,05 M 7,02 M 7,02 M
P/E ratio 2020 43,3x
Yield 2020 -
Capitalization 20,5 M 23,8 M 23,8 M
EV / Sales 2019 0,58x
EV / Sales 2020 0,50x
Nbr of Employees 973
Free-Float 97,0%
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Managers and Directors
Arnold van Mameren Chief Executive Officer
Désiree Theyse Chief Financial Officer
Gerhard H. Nordemann Chairman-Supervisory Board
Fred Boevé Director-Information Technology
Mennolt Beelen Member-Supervisory Board
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