Original-Research: q.beyond AG (von NuWays AG): Kaufen

Original-Research: q.beyond AG - from NuWays AG

Classification of NuWays AG to q.beyond AG

Company Name: q.beyond AG
ISIN: DE0005137004

Reason for the research: Update
Recommendation: Kaufen
from: 14.05.2024
Target price: EUR 1.10
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Philipp Sennewald

Strong Q1 figures hint towards successful transformation/ chg.

Yesterday, q.beyond released a strong set of Q1 figures, which exceeded ours and streets profitability estimates as efficiency measures bore fruit despite rather muted top-line growth. In detail:

Q1 sales increased slightly by 1.1% yoy to € 47.1m (eNuW: €47.5m, eCons: € 47.6m), of which 74% were recurring revenues. The muted growth momentum was predominantly due to the Consulting segment, which declined by 8% yoy to € 14.2m, which was mainly due to the reduction in low-margin project sales. This also allowed for an improved segment gross margin (+6.3pp to 8.4%). In the mid-term, management aims to continuously improve the Consulting margin driven among others by an increasing offand near-shoring ratio (target: 20% vs 12% after Q1), an improved utilizitation rate as well as higher daily rates. In contrast, the Managed Services segment grew by 5.7% yoy to € 32.9m at an improved margin of 21.5%. Hence, q.beyond was able to improve its gross profit by 38.5% to € 8.2m (eNuW: € 7.8m, eCons: € 7.9m), implying a margin of 17.5% (+4.7pp yoy).

On this basis, Q1 EBITDA also significantly improved to € 2.0m at an implied margin of 4.2% (eNuW: € 1.4m, eCons: € 1.4m), which compares to negative € 1.3m in the previous year's quarter. Next to the improved gross margin, EBITDA was driven by significantly reduced sales & marketing (-1.5pp yoy sales ratio) and G&A expenses (-0.3pp) as well as the effects of “One q.beyond” strategy (i.e. eliminating duplicate structures). FCF came in at € 1.4m (company definition: € 0.6m), leading to a continuously comfortable net cash position of
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NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag Adresse: Mittelweg 16-17, 20148 Hamburg, Germany ++++++++++
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