Systems Solutions
Order entry
millions of € |
|
|
|
|
|
|---|---|---|---|---|---|
|
2023 |
2022 |
Change |
Change |
2021 |
Order entry |
3,628 |
3,952 |
(324) |
(8.2) |
3,876 |
Development of business
The 2023 financial year continued to be dominated by the focusing of our systems solutions business on growth and future viability. As communicated at the Capital Markets Day in May 2021, we have established four portfolio areas in line with market needs: Advisory, Cloud, Digital, and Security.
We have also defined selected industries (automotive, healthcare, public sector, and public transport), for which we have increased our offer of vertical solutions based on our expertise. In addition, we have agreed partnerships with leading cloud service providers (e.g., Amazon Web Services, Google Cloud, and Microsoft Azure), so as to be able to offer our customers an even broader and more flexible range of cloud solutions. We are also increasingly expanding our portfolio with AI-based solutions and data room offerings.
By aligning ourselves in this way, our strategic goal is to become the leading IT service provider in the DACH region (Germany, Austria, Switzerland) and in other selected countries.
Order entry in our Systems Solutions operating segment decreased year-on-year by 8.2 % in the 2023 financial year, putting it below our expectations. This development was largely attributable to the high-volume deals concluded in the prior year. Furthermore, the prior-year figure includes order entry for Multimedia Solutions (MMS), which was reassigned to the Germany segment as of January 1, 2023.
Development of operations
millions of € |
|
|
|
|
|
|
||
|---|---|---|---|---|---|---|---|---|
|
|
2023 |
2022 |
Change |
Change |
2021 |
||
Revenue |
|
3,896 |
3,811 |
85 |
2.2 |
3,759 |
||
Of which: external revenue |
|
3,258 |
3,106 |
152 |
4.9 |
3,032 |
||
Service revenuea |
|
3,796 |
3,751 |
45 |
1.2 |
3,722 |
||
EBITDA |
|
272 |
229 |
43 |
18.8 |
174 |
||
Special factors affecting EBITDA |
|
(144) |
(159) |
15 |
9.4 |
(206) |
||
EBITDA (adjusted for special factors) |
|
416 |
388 |
28 |
7.2 |
380 |
||
EBITDA AL |
|
177 |
125 |
52 |
41.6 |
65 |
||
Special factors affecting EBITDA AL |
|
(144) |
(159) |
15 |
9.4 |
(206) |
||
EBITDA AL (adjusted for special factors) |
|
321 |
284 |
37 |
13.0 |
271 |
||
EBITDA AL margin (adjusted for special factors) |
% |
8.2 |
7.5 |
|
|
7.2 |
||
Depreciation, amortization and impairment losses |
|
(344) |
(340) |
(4) |
(1.2) |
(421) |
||
Profit (loss) from operations (EBIT) |
|
(71) |
(110) |
39 |
35.5 |
(247) |
||
Special factors affecting EBIT |
|
(270) |
(270) |
0 |
0.0 |
(384) |
||
EBIT (adjusted for special factors) |
|
198 |
160 |
38 |
23.8 |
138 |
||
EBIT margin (adjusted for special factors) |
% |
5.1 |
4.2 |
|
|
3.7 |
||
Cash capex |
|
(210) |
(221) |
11 |
5.0 |
(235) |
||
Cash capex (before spectrum investment) |
|
(210) |
(221) |
11 |
5.0 |
(235) |
||
|
||||||||
Revenue, service revenue
Revenue in our Systems Solutions operating segment developed more strongly than expected, increasing by 2.2 % year-on-year in the 2023 financial year to EUR 3.9 billion. This positive revenue trend is driven by growth in the Road Charging (up 23.7 %), Digital (up 10.9 %), and Advisory (up 3.4 %) portfolio areas, and by a slight increase in the Cloud portfolio area (up 2.4 %), which includes our declining traditional IT infrastructure business. External revenue increased by 4.9 %, mainly driven by the Digital and Road Charging portfolio areas. Service revenue also developed positively, increasing slightly by 1.2 %. In organic terms, revenue increased by 5.3 % year-on-year and service revenue by 4.3 %.
Adjusted EBITDA AL, EBITDA AL
In the 2023 financial year, adjusted EBITDA AL at our Systems Solutions operating segment increased by 13.0 % year-on-year to EUR 321 million, which was in line with our expectations. The increase in adjusted EBITDA AL is primarily attributable to revenue growth in the Road Charging and Digital areas. The negative impact of general price rises, especially in personnel and energy costs, was mitigated by efficiency measures. In organic terms, adjusted EBITDA AL grew by 10.0 % year-on-year. EBITDA AL increased by EUR 52 million compared with the prior year to EUR 177 million. The expense arising from special factors decreased by EUR 15 million year-on-year to EUR 144 million, mainly as a result of lower restructuring costs.
Profit/loss from operations (EBIT), adjusted EBIT
Adjusted EBIT in our Systems Solutions operating segment improved by EUR 38 million year-on-year in the 2023 financial year, coming in at EUR 198 million, due to the reasons described under adjusted EBITDA AL and as a result of declines in depreciation and amortization. EBIT increased by EUR 39 million compared with the prior year to EUR ‑71 million. The expense arising from special factors was unchanged against the prior year at EUR 270 million. In the reporting year, this included non-cash impairment losses on non-current assets totaling EUR 126 million. These related primarily to follow-up investments in connection with assets previously impaired in the 2020, 2021, and 2022 financial years. Furthermore, despite the business outlook remaining positive, the increase in the cost of capital in the reporting year prompted further impairment losses to be recognized on non-current assets at the end of 2023. Impairment losses totaling EUR 111 million were recorded as special factors in the prior year.
Cash capex (before spectrum investment), cash capex
Cash capex in the Systems Solutions operating segment stood at EUR 210 million in the 2023 financial year, down EUR 11 million against the prior year. This trend mainly resulted from lower capital expenditure in the Cloud portfolio area. By contrast, capital expenditure in the Road Charging area was up year-on-year due to rising demand for on-board units. The prior-year figure had also included the MMS entity, which was reassigned to the Germany operating segment effective January 1, 2023.