ICT reports revenue and EBITDA growth

Q1 2021 results ICT Group

Highlights Q1 2021

• Revenue in Q1 2021 up 5% to € 43.7 million (Q1 2020: € 41.6 million)
• Organically revenue was flat, mainly due to the tight labour market
• EBITDA increased 20% to € 5.4 million (Q1 2020: € 4.5 million) due to increased productivity levels and cost control measures 
• On 1 April ICT announced the closing of two acquisitions in industrial automation  
• The future business impact of the pandemic is difficult to predict, therefore we refrain from giving an outlook for the full year 2021.

Intended public offer

• On 5 March 2021, a Consortium led by NPM Capital announced an intended public offer for ICT Group
• The Offer Memorandum related to the intended public offer was filed with the AFM for review and approval on 1 April 2021
• Unconditional approval of the Netherlands Authority for Consumers & Markets (Autoriteit Consument & Markt) in connection with the Offer is obtained

Key figures

Jos Blejie, CEO of ICT Group N.V.:
“In Q1 2021 we saw the trends continuing, including the ongoing strong performance of our nearshoring and project businesses, and at the same time the impact of Covid-19 still weighing on other activities. Moreover, Covid-19 is constraining our recruitment activities, which makes it harder to attract new talent. This in particular contributed to a flat organic revenue development. Thanks to the contribution of the acquisitions Yellowstar and Esprit, reported revenue growth came in at 5%.

The EBITDA development reflects the increased productivity levels, which we saw improving since last summer. In combination with our continued cost discipline, EBITDA improved compared to Q1 2020. 

As expected, the uncertainties related to Covid-19 continue to limit our visibility. Furthermore, the tight labour market continues to pressure organic growth. We are however well positioned and well equipped, thanks to our enhanced business agility, to continue our strategic journey.”

Financial developments
In the first quarter of 2021 revenue increased by 5% to € 43.7 million from € 41.6 million in the same period last year. This increase is mainly attributable to the acquisitions of Esprit (consolidated as of July 2020) and Yellowstar (consolidated as of January 2021). Organically, revenue was at the same level as Q1 last year. 

EBITDA increased 20% to € 5.4 million in the first quarter of 2021 compared to € 4.5 million in the same period in 2020. This increase is attributable to increased productivity levels as well as cost control measures. 

The EBITDA margin came in at 12.4%, an improvement compared to Q1 2020 (10.9%). 

At ICT Netherlands we saw an improvement in productivity levels, mainly in the Engineering R&D segment where the Automotive activities improved versus the first quarter last year. 

COVID-19 impacted the public transport activities, including TURNN and also Improve continued to be affected as the market for trainings is still at low levels. OrangeNXT faced lower project activity levels. 

The nearshoring activities in Bulgaria continued their strong performance, both in revenue and result. The productivity levels of the Swedish activities are improving versus the first quarter 2020. Also in Sweden, the tight labour market is limiting growth. 

Acquisitions
On 1 April 2021, ICT announced the closing of the acquisition of Profit Consulting Eindhoven B.V. and Profit Consulting Apeldoorn B.V. as well as the acquisition of Strypes Nederland B.V. The latter includes a subsidiary in Portugal, Strypes Technical Software Unipessoal LDA Portugal, which provides ICT with a new nearshoring location. 

Outlook
The labour market remains challenging and we foresee recruitment activities still being hampered by COVID-19, therefore we expect organic growth to continue to be pressured. Because of this, combined with the difficulty to predict the future business impact of the pandemic, we refrain from giving an outlook for the full year 2021.