Solteq - Fairly well in line with our estimates
Solteq’s Q1 performance was broadly in line with our expectations. The company recorded its fifth consecutive quarter of improved comparable operating profit, though sales remained sluggish as anticipated. In the Utilities segment, recurring revenue continued to rise, exceeding 50%.
- Comparable net sales in Q1 were EUR 12.1m (Q1’24: EUR 13.1m) vs. Evli EUR 12.3m, a decline of 7.2% y/y in comparable terms.
- Comparable operating profit in Q1 was EUR 0.1m (Q1’24: EUR -0.3m) vs. Evli EUR 0.3m. Operating result was EUR 0.2m (Q1’24: EUR -0.2m).
- Retail & Commerce: Comparable revenue in Q1 amounted to EUR 9.2m (Q1’24: EUR 9.9m) vs. Evli EUR 9.3m. Revenue declined by 6.9% in comparable terms. The adj. EBIT was EUR 0.7m (Q1’24: EUR 0.4m) hitting our estimate. Profitability continued to improve, supported by efficiency measures implemented in 2024.
- Utilities: Revenue in Q1 amounted to EUR 2.9m (Q1’24: EUR 3.2) vs. Evli EUR 3.0m. The 8.2% y/y decrease in revenue was driven by weak demand in the consulting business. The adj. EBIT was EUR -0.6m (Q1’24: -0.7m) vs. Evli EUR -0.4m. The company succeeded in improving the segment’s recurring revenue share to over 50%.
- Net debt amounted to EUR 20.4m (Q1’24: 23.6m).
- Guidance for 2025 (reiterated): Comparable revenue is expected to decrease slightly (2024: EUR 48.8m excluding the divested healthcare software solutions business), while comparable operating result is set to improve significantly (2024: EUR 0.7m).
- The market environment remained challenging, with sluggish customer demand, postponed investment decisions and an uncertain global economy.
- During the review period, Solteq cancelled EUR 4.3m worth of its outstanding notes. The debt repurchase and cancellation strengthen Solteq’s balance sheet, reduce interest expenses, and enhance financial flexibility going forward.