The Executive Board takes a positive view of the further growth prospects for the adesso Group. Another double-digit growth rate in sales and a further increase in operating earnings are expected for 2023, which would take sales to more than EUR 1 billion and EBITDA to between EUR 100 million and EUR 110 million. Continuing the distribution policy of recent years, the Executive Board with approval of the Supervisory Board proposes an increase in the dividend per share to EUR 0.65 (previous year: EUR 0.60) for financial year 2022.
adesso’s business performed well in 2022 across all core industries in which it operates, despite deteriorating macroeconomic growth momentum in view of the geopolitical tensions and their impacts. The adesso Group benefited from its modern and market-oriented range of IT services and software products and from continued demand in these segments. The sharp rise in the headcount gave sales growth a further year-on-year boost to 33 % and helped strengthen the company’s market position. At EUR 488.1 million, sales in the second half of 2022 outperformed those in the first half (EUR 412.1 million) by a significant margin due to the continued rise in employee numbers, the distribution of working days and the further increase in licence revenue in the last six months of the year. The final quarter was once again the strongest of the year, coming in at EUR 246.7 million.
Following only slight revenue growth in the core healthcare sector in the previous year, all core sectors generated clear double-digit growth rates in 2022. Growth was particularly high in the relatively new manufacturing industry sector (78 %), which is now contributing close to a three-digit million euro amount to total sales. The public administration core sector also recorded a sharp increase of 63 %, making it adesso’s strongest sector in terms of sales, at EUR 151.5 million. In addition, business went well in the established insurance and banking sectors, taking their contributions to EUR 136.5 million (+12 %) and EUR 118.8 million (+18 %), respectively.
The sharp increase in staff numbers throughout the Group continued and, in conjunction with many new customer projects, resulted in strong organic sales growth. As at the reporting date, the number of employees (converted to full-time equivalents) increased year on year to 8,056 (+39 %).
Although there was a disproportionate rise in sales to customers in Switzerland, Austria and Turkey, 81 % of revenue was still generated domestically. Sales increased by 33 % both in Germany and abroad. The company continued to pursue its internationalisation strategy in the financial year. As of the end of the year, adesso employed 1,405 people outside of Germany, a 40 % increase compared to late 2021.
The IT Services segment once again increased sales markedly on the back of continued healthy demand (35 %). The IT solutions segment also reported a significant increase in revenue of 14 %, primarily due to the record licence revenue from the proprietary in|sure Ecosphere product family.
Unadjusted operating earnings (EBITDA) decreased by 9 % across the Group to EUR 92.9 million. Excluding the non-recurring effect from the company sale in the previous year, EBITDA grew by 10 % from EUR 84.1 million in 2021. The slower increase compared to sales resulted in a smaller EBITDA margin of 10.3 %, compared with 12.4 % (excluding the non-recurring effect) in the previous year. The decline in profitability was largely due to capacity utilisation delays at adesso SE in light of the rapid growth and carried-out planned investments in corporate culture and infrastructure. There were also significantly higher rates of sick leave in 2022 than in the preceding two years, in which remote work played a major role.
Accompanied by ongoing investment in adesso’s own industry products, licences and maintenance revenues from the in|sure Ecosphere product family reached an encouraging new record level. By contrast, other operating expenses weighed on results, with a disproportionately large increase compared to sales of 71 %, or EUR 45.1 million, to EUR 108.5 million. With the average number of employees rising by 29 %, cost of materials also climbed by a disproportionately high margin compared to sales of 44 % to EUR 134.4 million (mainly due to external services). There was a structural change in the share of external services following the acquisition of KIWI Consulting GmbH, as that company’s business model provides for greater use of external services. Gross profit rose slightly less sharply than sales, by 31 % to EUR 765.8 million. In absolute terms, gross profit per employee continued increasing from EUR 108 thousand in the previous year to EUR 110 thousand in the reporting year. Personnel costs per FTE were up only moderately by 2 %.
Depreciation and amortisation increased by 24 % in the reporting period to EUR 44.8 million. The main drivers of this development were the 24 % increase in amortisation of rights of use from leases and the almost unchanged amortisation in connection with intangible assets recognised in the context of company acquisitions amounting to EUR 7.3 million (previous year: EUR 7.0 million). The effective tax rate came in at 32 % (previous year: 25 %). The increase in the tax rate was primarily due to the sale of the e-Spirit companies in 2021, which generated income that was largely tax-free. In all, this resulted in positive consolidated earnings in the amount of EUR 28.8 million, compared with EUR 47.6 million in the previous year (EUR 30.0 million before the non-recurring effect). Earnings per share stood at EUR 4.40, compared with EUR 7.59 in the previous year (EUR 4.78 before the non-recurring effect).
Working capital rose only slightly more than revenue, by 36 % to EUR 166.1 million as at the reporting date (previous year: EUR 122.4 million). This was due primarily to the development of receivables. Net liquidity after deducting the financial liabilities was EUR -15.6 million, compared with EUR 31.0 million in the previous year. Equity rose by EUR 29.6 million to EUR 215.2 million, mainly due to the positive consolidated earnings and the increase in minority interests in connection with the acquisition of material.one AG. However, the equity ratio declined slightly year on year, from 33.3 % to 32.8 %, as current liabilities also rose.
adesso expects to see rising demand for digitalisation initiatives throughout all sectors in 2023 and the years ahead. Order intake to date provides a sound basis for another double-digit growth rate in sales the current financial year. In the IT Services segment especially, the outlook is positive across all sectors. The pipeline for in|sure Ecosphere remains strong in the IT Solutions segment, although it is unlikely to improve on the record year that was 2022. For operating earnings (EBITDA), an increase of between 8 % and 18 % is expected. Although financial year 2023 has two fewer working days than the previous year, the Executive Board sees potential in capacity utilisation and booking intensity, as well as increased utilisation of shoring capacity.
On this basis, adesso plans to increase its sales revenue to more than EUR 1 billion in 2023. EBITDA is expected to rise to EUR 100 million to EUR 110 million.
The full annual report, as well as a table comparing key performance indicators over a period of several years, is available at www.adesso-group.de in the Investor Relations section.