Interim Report Q2 2023: Development in line with expectations

Company Announcement no. 13/2023
9 August 2023

Wirtek’s Board of Directors has today approved the interim report for Q2 2023. Below a summary - the detailed report is attached to this announcement.

CEO Michael Aaen comments:

“In Q2 2023 we achieved a satisfying organic revenue growth of 12% and EBITDA growth of 6% despite a somewhat unpredictable market situation. The positive development covers a significant inflow of new orders from both new and existing clients during the end of Q2 2023 while some of our clients at the same time have had to scale back on some of our services during H1 2023.

The Energy sector presents a substantial growth opportunity for Wirtek, and we are experiencing a surge in demand within this sector, driven by the worldwide focus on renewable energy. We expect our Energy business unit to grow rapidly during H2 2023, with an estimated business unit growth of more than 60% compared to H1 2023.

We are now halfway through our 5-year Accelerate25XL strategy and as expected we have delivered profitable growth by an average annual revenue growth of 37% and an average annual EBITDA growth of 30% since the beginning of 2021. We retain the long-term financial goals of DKK 130m in revenue and DKK 18m in EBITDA during 2025 and we also maintain our financial goals for 2023.”

Financial highlights for the period 1 January - 30 June 2023

Organic revenue growth of 12% with an EBITDA-growth of 6% during Q2 2023

• Revenue grew organically by 12% to TDKK 17,299 during Q2 2023 compared to revenue of TDKK 15,447 during Q2 2022. Organic revenue growth during H1 2023 was 11% compared to H1 2022. The achieved growth stems from both increased engagements with existing clients as well as expansion of the client list.
• EBITDA was TDKK 1,819 in Q2 2023 compared to TDKK 1,724 for the same period last year, a growth of 6%. During H1 2023 EBITDA was TDKK 3,629, down by 16% compared to H1 2022 due to the negative EBITDA-growth of -30% during Q1 2023 compared to Q1 2022. The EBITDA decline in H1 2023 is expected to be compensated in H2 2023 by a more efficient use of resources.
• The EBITDA-margin for Q2 2023 was 10.5% compared to 11.2% during same period in 2022. For H1 2023 the EBITDA margin was 10.2% compared to 13.6% during H1 2022.
• Pre-tax profits (EBT) were TDKK 1,660 in Q2 2023, a growth of 28% compared to TDKK 1,300 during Q2 2022. EBT for H1 2023 was 3,096, down by 10% compared to H1 2022.
• Equity was TDKK 16,448 end of Q2 2023, up by 20% from Q2 2022. The equity ratio was 48% end of Q2 2023.
• Cash holdings were TDKK 5,166 end of Q2 2023, down by 20% from Q2 2022. Part of the cash-position is offset by a credit facility of TDKK 2,918. A negative cash flow of TDKK 1,795 was generated during Q2 2023, impacted negatively by change in trade receivables, dividend payment, investments in new office facilities in Romania as well as earn-out payment for the CoreBuild acquisition. Operating activities generated TDKK 648 in cash during Q2 2023, up by 266% compared to Q2 2022. For H1 2023 the cash flow from operating activities was TDKK 2,992, resulting in a Cash Conversion Ratio (Operating cash flow / EBITDA) of 82%. 

Maintained expectations for 2023

Despite continued uncertainty and less predictable markets, the expectations are retained for 2023. 

• Organic Revenue for 2023 is expected in the range of DKK 73.0m – 78.0m, a growth of 11% – 19% compared to 2022.
• EBITDA for 2023 is expected in the range DKK 6.0m – 9.0m, a growth of -20% – +27% compared to 2022.

Further information

• Kent Mousten Sørensen, Chairman, Wirtek A/S, Phone: +45 2125 9001
• Michael Aaen, CEO, Wirtek A/S, Phone: +45 2529 7575, E-mail: ir@wirtek.com
  Niels Jernes Vej 10, 9220 Aalborg, Denmark, www.wirtek.com

• Per Vestergaard, Certified Advisor, CDI Global, Phone: +45 2176 4317

About Wirtek

Wirtek A/S is a Danish IT consultancy company that provides software development, testing, and consultancy services to help clients worldwide. With a team of more than 200 talented professionals, Wirtek specializes in Digitalization, Energy, Workforce & Facility Management, Wireless Communication & Automation, and Trade & E-commerce.

At Wirtek, we prioritize building long-term client relationships, with some lasting over a decade. We believe that quality partnerships are just as important as software quality in achieving our client's goals. Established in 2001, we have offices in Denmark and Romania and have been listed on Nasdaq First North Copenhagen since 2006.  

Ticker Code: WIRTEK (DK0060040913)