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Systems Solutions

Order entry

millions of €

 

 

 

 

 

Q1 2022

FY 2021

Q1 2021

Change
Q1 2022/
Q1 2021 
%

Order entry

1,097

4,174

891

23.1

Development of business

The first three months of 2022 continued to be dominated by the focusing of our systems solutions business on growth and future viability and the continuation of our transformation program. In keeping with our refined strategy communicated at the Capital Markets Day in May 2021, we have divided our business into four portfolio areas in line with market needs: Advisory, Cloud Services, Digital, and Security.

We have 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, Google, and Microsoft), so as to be able to offer our customers an even broader and more flexible range of cloud solutions.

Order entry in our Systems Solutions operating segment was up by 23.1 % year-on-year in the first three months of 2022, mainly due to an increase in Cloud Services, which includes growth in both the public cloud business and in traditional IT business. The Digital portfolio area also recorded further growth.

Development of operations

millions of €

 

 

 

 

 

 

 

 

Q1 2022

Q1 2021

Change

Change %

FY 2021

Total revenue

 

996

1,015

(19)

(1.9)

4,019

Of which: external revenue

 

802

798

4

0.5

3,171

Service revenuea

 

973

920

53

5.8

3,893

Profit (loss) from operations (EBIT)

 

(2)

(27)

25

92.6

(242)

Special factors affecting EBIT

 

(45)

(56)

11

19.6

(393)

EBIT (adjusted for special factors)

 

43

29

14

48.3

151

EBIT margin (adjusted for special factors)

%

4.3

2.9

 

 

3.8

Depreciation, amortization and impairment losses

 

(71)

(80)

9

11.3

(425)

EBITDA

 

70

53

17

32.1

183

Special factors affecting EBITDA

 

(30)

(36)

6

16.7

(213)

EBITDA (adjusted for special factors)

 

100

89

11

12.4

396

EBITDA AL

 

43

26

17

65.4

73

Special factors affecting EBITDA AL

 

(31)

(36)

5

13.9

(213)

EBITDA AL (adjusted for special factors)

 

73

62

11

17.7

286

EBITDA AL margin (adjusted for special factors)

%

7.3

6.1

 

 

7.1

Cash capex

 

(43)

(49)

6

12.2

(237)

a

As of January 1, 2022, we extended our definition of service revenue in the Group, which increased this figure in the reporting period. The prior-year figures have not been adjusted retrospectively.

Total revenue, service revenue

Total revenue in our Systems Solutions operating segment in the first three months of 2022 amounted to EUR 1.0 billion, down 1.9 % on the prior-year level. External revenue was up 0.5 %. The decrease in total revenue was mainly driven by the expected decline in traditional IT infrastructure business, due in part to deliberate business decisions such as the reduction in end-user services. The positive trends, especially in the Digital Solutions portfolio unit (up 8.7 %), did not fully offset this decrease. In organic terms, revenue was down 0.8 % year-on-year. Service revenues increased by 5.8 % due to the extension of the definition.

Adjusted EBITDA AL, EBITDA AL

In the first three months of 2022, adjusted EBITDA AL at our Systems Solutions operating segment increased by 17.7 % year-on-year to EUR 73 million. Efficiency effects from our transformation program and effects from increased revenue in our growth areas exceeded the decline in earnings in the traditional IT infrastructure business. In organic terms, adjusted EBITDA AL grew by 18.1 % year-on-year. EBITDA AL increased by EUR 17 million compared with the prior year to EUR 43 million. Special factors were down EUR 5 million on the prior year, at EUR ‑31 million, mainly due to lower restructuring costs.

Adjusted EBIT, EBIT

Adjusted EBIT in our Systems Solutions operating segment in the first three months of 2022 improved by EUR 14 million year-on-year, coming in at EUR 43 million, mainly as a result of declines in depreciation and amortization. EBIT increased by EUR 25 million compared with the prior year to EUR ‑2 million. The expense arising from special factors decreased by EUR 11 million year-on-year, to EUR ‑45 million, mainly due to the reason described under EBITDA AL.

Cash capex

Cash capex in the Systems Solutions operating segment stood at EUR 43 million in the first three months of 2022, down EUR 6 million year-on-year, primarily due to higher lagging payments in the prior year. We will continue to focus our investments on developing our growth business.

AL – After Leases
Since the start of the 2019 financial year, we have taken the effects of the first-time application of IFRS 16 “Leases” into account when determining our financial performance indicators. “EBITDA after leases” (EBITDA AL) is calculated by adjusting EBITDA for depreciation of the right-of-use assets and for interest expenses on recognized lease liabilities. When determining “free cash flow after leases” (free cash flow AL), free cash flow is adjusted for the repayment of lease liabilities.
Glossary