Serviceware SE: Full-year figures 2021/2022 marked by planned transformation to SaaS business model - well positioned for further growth

[ Report ]

Idstein (pta011/27.02.2023/09:00) -
* Adjusted forecast for sales revenues and earnings met
* Total sales revenues +2.3 percent
* SaaS/Service sales revenues +19.9 percent
* Share of recurring sales revenues rises from 61.5 to 67.6 percent
* Sales revenue growth of 5 to 10 percent and improvement in EBITDA planned for fiscal 2022/2023
* Serviceware excellently positioned in the current macroeconomic transition process towards the digitalisation of service processes and with sustainable growth potentials

Idstein, 27 February 2023 As expected, fiscal 2021/2022 (until 30 November) of Serviceware SE ("Serviceware", ISIN DE000A2G8X31) was characterised to a large extent by the transformation of its business from a licence-based to an SaaS business model. Serviceware has supported this development with extensive investments and expenditures. As a result, the share of SaaS/Service revenues in total sales revenues rose very significantly by 19.9 percent from EUR 40.1 million to EUR 48.1 million, according to preliminary still unaudited figures. Recurring revenues accounted for 67.6 percent of sales revenues during the past fiscal year, compared to 61.5 percent in the previous year. Due to the increasing prevalence of SaaS/Service agreements, stable recurring revenues will increasingly replace more volatile, one-off licence revenues in the coming quarters, while selling expenses for the identification and handling of leads in particular will be fully recognised during the current reporting period.

The backlog of orders, essentially consisting of advance payments received for maintenance and SaaS agreements, rose by 23.0 per cent to EUR 32.4 million in 2021/2022. The operating cash flow amounted to EUR 0.78 million. Cash and cash equivalents totalled EUR 29.1 million at the end of November 2022. Additional financial resources of EUR 1.7 million are invested in a long-term Bund (German government bond). Equity fell from EUR 53.9 million to EUR 49.9 million as at 30 November 2022. The equity ratio was 45.8 percent on the balance sheet date (prior year: 48.7 percent). The balance sheet total decreased from EUR 110.8 million to EUR 108.8 million.

In addition to the planned transformation of the business model, the difficult macroeconomic and geopolitical environment temporarily affected the key financial ratios of Serviceware. High inflation, rising interest rates, disrupted supply chains and the consequences of the war in Ukraine led to an extension of decision-making processes for many customers. Serviceware achieved its adjusted forecast for sales revenues and earnings in this environment. Total sales revenues increased by 2.3 percent from EUR 81.3 million to EUR 83.2 million. The EBITDA reached EUR -1.6 million after EUR +2.2 million during the previous year.

The challenging macroeconomic environment, which has temporarily caused friction for customers, is likely to act as a catalyst for accelerating the digitalisation of service processes in the medium term. Studies show that companies have identified improving the efficiency of business processes as the main benefit of automation. The international market research and analysis company Gartner Group therefore expects average annual market growth of 22.8 percent up to 2026 for the "IT Financial Management" market segment, which is particularly relevant for Serviceware. Serviceware is ideally positioned to benefit disproportionately from this development.

During the past fiscal year, numerous new customers were acquired for the ESM platform of Serviceware, including several corporate groups and large corporations. In addition, sales activities were strengthened within the framework of the international expansion strategy, which also resulted in an increasing number of test installations and pre-contractual trials. Serviceware has consistently continued to expand its ESM platform and is increasingly using artificial intelligence in applications. In this way, Serviceware has further enhanced its market position as one of the world's leading providers for Enterprise Service Management in recent quarters.

Based on its excellent market position, the high level of predictability in SaaS/Service revenues and a good start to the fiscal year 2022/2023, Serviceware expects a positive business performance for the full year. Sales revenue growth of 5 to 10 percent is planned, with an improvement in EBITDA. For the following years, Serviceware is confident to further accelerate sales revenue and profit growth.

Dirk K. Martin, CEO of Serviceware: "We cannot be satisfied with the financial figures of the past fiscal year. The current environment has slowed down our growth. At the same time, however, we are seeing the effects of the increasing shift from licence revenues to SaaS/Service revenues at Serviceware. The positive effects of this will be system-inherent in the coming years in terms of revenue levels and revenue predictability as well as profitability. In addition, we have laid important foundations in the past year so that we can benefit in the future from the radical change which is currently taking place in the economy. Efficient, high-performance digital service processes are increasingly becoming a decisive competitive edge for companies - Serviceware makes the difference here with its products and the unique ESM platform for our customers. We will be among the global winners in this field. Already during the current fiscal year, we will be able to show significantly more positive figures again."

The complete annual financial statements and the Annual Report 2021/2022 will be available from 24 March 2023 at http://www.serviceware-se.com in the Investor Relations section.

Webcast on 28 February 2023

Serviceware invites investors and media representatives to a video conference on 28 February 2023 at 12:00 pm to explain the annual figures and the outlook. Access data can be requested by e-mail at investor-relations@serviceware-se.com.

About Serviceware

Serviceware is a leading provider of software solutions for the digitalisation and automation of service processes (Enterprise Service Management) with which companies can increase their service quality and manage their service costs efficiently.

The Serviceware Platform includes the software solutions Serviceware Processes, Serviceware Financial, Serviceware Resources, Serviceware Knowledge and Serviceware Performance. All solutions can be used in an integrated manner, but also independently from one another.

Serviceware partners with customers from strategic consulting through the definition of the service strategy to the implementation of the Enterprise Service Platform. Further components of the portfolio are safe and reliable infrastructure solutions as well as Managed Services.

Serviceware has more than 1,000 customers worldwide from various business sectors, including 17 DAX companies and 5 of the 7 largest German companies. The headquarters of the company are in Idstein, Germany. Serviceware employs more than 500 employees at 14 international sites.

For more information visit http://www.serviceware-se.com.

Media Relations
edicto GmbH
Axel Mühlhaus/Doron Kaufmann
Tel. +49(0) 69/905505-52
Email: investor-relations@serviceware-se.com

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