Systems Solutions

Order entry

Development of business

The first three months of 2023 continued to be dominated by the focusing of our systems solutions business on growth and future viability and the continuation of our transformation program. As communicated at the Capital Markets Day in May 2021, we have established four portfolio areas in line with market needs: Advisory, Cloud Services, 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, Google, and Microsoft), so as to be able to offer our customers an even broader and more flexible range of cloud solutions.

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 was down by 27.8 % year-on-year in the first three months of 2023. This development is largely attributable to the major deal for cloud services that had been signed in the prior year, as well as delays in connection with the conclusion of several new contracts.

Development of operations^a

Revenue, service revenue

Revenue in our Systems Solutions operating segment developed more strongly than expected, increasing by 2.0 % year-on-year in the first three months of 2023 to EUR 946 million. This positive trend was mainly driven by growth in the Digital (up +13.6 %), Road Charging (up +29.0 %), and Advisory (up +13.8 %) portfolio areas, and it more than offset the expected decline in traditional IT infrastructure business. External revenue increased by 3.7 %, mainly driven by the Digital portfolio area. Service revenue also developed positively, increasing by 0.8 %. In organic terms, revenue increased by 4.5 % year-on-year and service revenue by 3.2 %.

Adjusted EBITDA AL, EBITDA AL

In the first three months of 2023, adjusted EBITDA AL at our Systems Solutions operating segment increased by 10.3 % year-on-year to EUR 75 million, which was in line with our expectations. Efficiency effects from our transformation program and effects from increased revenue in our Digital and Road Charging portfolio areas exceeded the decline in earnings in the traditional IT infrastructure business. In organic terms, adjusted EBITDA AL grew by 4.6 % year-on-year. EBITDA AL increased by EUR 10 million compared with the prior year to EUR 49 million. The expense arising from special factors decreased by EUR 4 million year-on-year, to EUR 26 million.

Profit/loss from operations (EBIT), adjusted EBIT

Adjusted EBIT in our Systems Solutions operating segment grew by EUR 7 million year-on-year in the first three months of 2023, coming in at EUR 46 million, due to the reasons described under adjusted EBITDA AL. EBIT increased by EUR 16 million year-on-year to EUR 11 million. The expense arising from special factors decreased by EUR 8 million year-on-year, to EUR 35 million, as a result of lower depreciation, amortization and impairment losses.

Cash capex (before spectrum investment), cash capex

Cash capex in the Systems Solutions operating segment stood at EUR 60 million in the first three months of 2023, up EUR 17 million year-on-year, primarily due to catch-up effects in the Cloud Services and Road Charging portfolio areas caused by supply shortages in 2022.