Welcome to the DATAGROUP SE conference call on the half-year report for the financial year of 2020/2021. At the moment, all participants are on mute. The floor will be open for questions after the presentation. If you would like to ask a question, please press the hand symbol or type your question into the question box. The presentation is also available for download in the investor relations section on DATAGROUP's website. I would now like to welcome Mr. Max Schaber, CEO of DATAGROUP. Good morning to all. I'm very happy to show you an excellent first half year of DATAGROUP. We could grow our revenue to 24.4%, from EUR 170 million - EUR 211 million, which is a very fast growth. The EBITDA grows faster with 28.1%, and we also could grow significantly the EPS, earnings per share, 21.5% to EUR 1.30 per share. What are the real figures beyond that? It was a strong organic growth. We had in all our divisions, in all our companies, a very good development of organic growth. We have consolidated the Portavis GmbH, which we bought last year, complete. We also could help the share of service revenue, far above the 80%. We realized 83.3%. What we also had some special effects out of deferred taxes, which I come to on that later. Next page, please. These excellent results of the first half-year brought us to increase our guidance. All DATAGROUP market units exceeds far our expectations. The restructuring of FIS is progressing much better than expected, and we also have two successful corporate acquisitions completed. These figures are not within the half-year figures. We can expect very good figures for the future, but these two successful acquisitions are not in the figures we show now. We also have had a very strong sales pipeline and sales success over the last six months. We have also significant extensions to existing customer situations, and this all together led to a strong organic growth. 14 new customers, new CORBOX customers. 26 contract renewals. To be honest, it is also very, very important to renew the existing contracts. These contracts we could renew a lot of, and we also could extend 15 contracts with very big figures. This all together led us to an increase of the guidance. We guide from now a revenue bigger than EUR 440 million this year and an EBITDA bigger than EUR 61 million. You can see we came from EUR 410 million- EUR 420 million revenue. We are based on the strong organic growth. Very good to reach the EUR 420 million without any additional things. With the new companies we bought, we aim to more than EUR 440 million, which we are quite sure to reach. Also on the EBITDA side, we could grow our guidance very good. We are very fine with these figures and let's see what the next half year brings. All the signs are on going up, you never know. You know us since a few years, we are very conservative also with our figures, with our guidances. Next page. Corona was the big thing of the last 18 months, of the last 15-18 months. At some point, we saw some problems within the corona epidemic. The reality is that corona brought us big order intakes. For example, the equipment of vaccination centers in Baden-Württemberg. We got an order late in November last year to equip 60 vaccination centers in Baden-Württemberg with a Microsoft-based digital infrastructure. The project was the design of the entire solutions in the public cloud environment, which is very interesting for us. We are also offering cloud solutions in our own data centers, we also promised in the last years that we are moving in the direction to a multi-cloud hybrid provider, this is a big project where these skills are used. We could set up, roll out, and operate the managed clients of the vaccination centers, a few thousand of them. We also bring service desk and technical support of these centers with our engineers. Since January 2021, the entire vaccination process is supported by our solutions. The challenge was only one month from offer to productive rollout, 8,000 users in over 60 locations. This is possible only on using public cloud infrastructure. It would be not possible to do that on a local structure, this shows us that we are very good skilled now in the public cloud offering and realization of public cloud projects. Next page, please. Yeah, we also have had some other good projects and good new customers. We have a good order intake with AI, artificial intelligence, and automation and mobilization of business processes. We have a nice robotic process automation platform project for a telco. We have an order from a retail customer, mobile app for a contactless payment. We also have a new order intake from a bank. This is quite interesting project, development of a software robot for back-office processes. We had some other interesting things like a recognition of bills for bonus programs. We have also a recognition of handwritten text on forms and recognition of custom documents for the automation of Brexit procedures. You can see with this project that we are also very successful on the way to help our customers to digitize their business processes. The best, most of these projects led us to a recurring revenue situation with the customer. This is the thing we aim for. We want to have many customers with a maximum of recurring revenue. This is what we are aiming for with our salespeople, that we can get these projects, and after finishing the project, can get these recurring revenue contracts. Next page, please. Yeah, Sparda-Bank counts on Almato, our digitalization partner company, and is a very good customer response. You can see it on the slide. We have made a property portal with innovative AI services based on the AWS public cloud. We also had development of a service app for banking customers. We have had these back-office processes and the development and support of customer self-service center for mortgages. You can see if a customer wants to digitize his processes, he's very good with DATAGROUP on the way. This bank, Sparda-Bank Baden-Württemberg, is very successful with solutions of DATAGROUP. Next page, please. What was very surprising for us was that the second lockdown hasn't had any negative impact of our business operations. In opposite to the first lockdown, which brought some negative effects in form of lower sales processes and irritated customers. How can we manage DATAGROUP and the customer together if our engineers come to the customer site? What now happened is that our strong customer base with our long-term contracts could deliver stable recurring revenues and all market units, I said it before, are running at a good and increasing profitability. DATAGROUP. No, please back. DATAGROUP. Can I have the last slide? Thank you. DATAGROUP could realize a high level of remote work among the DATAGROUP workforce. Up to 90% of our employees are home office enabled. They use it very deeply. This led to lower travel costs. This led to a higher profitability, a higher efficiency of our workforce. At the end of all, we can say corona, it has not negative effects for DATAGROUP, but more positive effects. What we did is we have had a strong focus on health protection for employees and customers. The numbers, the figures of people who got the virus is very far below the official figures government gives out. Our situation, our protection for the health of our customers and employees is working very well. A strong thank you for all our people who managed that complicated but very successful processes. Sales activities have been shifted to virtual formats. Surprisingly, we expect an increase in new customer wins. At the beginning of the first lockdown, we thought, oh God, what will be the effect on our sales of new customers? What we see now, it is increasing. New customers are taking the possibility of virtual formats. This is a very good news for us. Next page, please. Let's come to the figures again. We increased our revenues. We have total revenue 21.3% more than the former half year. We have had also a strong growth of material expenses. This is based on some special projects based on lockdown, too. Customers are renewing their IT equipment. We could deliver this. This is not a focus we do in DATAGROUP, but it is a need. The customers moved to all-in-one shopping more than they did before. This is the reason why our material expense is growing so fast. Gross profit also went up very good. The very good thing is that the personal expenses only went up for 10%. Gross profit goes up for 17.5%, which means surely that our EBITDA figures come up very fast. The EBIT is going up 44%, which is a very good sign for us, and we are very focused on the development of EBIT. You will see in the next few years that we grow our EBIT massively. Net income based on EBITDA, net income came up 21%, and the earnings per share came up also a bit more than 21%. Please remember that in the last half-year figures, we have had in these bargain purchase effect from Portavis, and we also had the risk provision of EUR 5.5 million, that the net positive effect is around EUR 6.66 million. The realistic figures of actual first half-year 2020/2021 is much better than it is shown in the change percentage. You can see that we earned in the organic business a lot more than the year before. This is based on improved productivity, and we also could bring down depreciation and amortization, the effects are shown in this table. Next page, please. Balance sheet figures are getting better. We could bring down the goodwill a bit. This is based on amortization of goodwill PPA amortization. We also could bring down our short-term liabilities a bit. This comes with a bit more long-term financial liabilities. We also have a bigger finance lease liabilities. This is based on acquisition of new companies. We also went up in pension provisions. You remember there is a big increase in pension provisions out of Portavis last year, and we also could bring down liabilities to financial institutions. A very good cash flow led to increase in cash and cash equivalents, and it led to a reduction of liabilities. We could grow what was very important for us, our equity ratio. Some of you had the fear that we go down in equity ratio. The opposite has realized. We could grow the equity ratio a bit against the last year full figures. It's a bit down against the half year figures last year, but it is up against the full year figures 2020. Let me see. We have a return on equity, which went up, and the balance sheet in total is only up 1.4%. Next slide, please. Very important thing is that we could change our cash flow. We had a very significant decrease of CapEx. We had 82% decrease in cash outflow for investment in plant and equipment. This is based, we did not need more investments in data centers, and we did not need more investments in other project-related costs, which was a plan, but we are better than our own plan in this type of investment. We also went down in cash outflow for investments in intangible assets, 30% down. We also have short-term cash investments to avoid negative interest. Last year, first time, we paid some negative interest rates, and to avoid that, we lent out some money with positive interest rates. Also, we have cash out for the acquisition of the outstanding 32% of Portavis. You remember we bought the main share package of Portavis last year, and there was an outstanding part of 32%, 25% in the Haspa, Hamburger Sparkasse, and 7% in the Sparkasse Bremen. These two packages of shares we bought in the end of the year 2020, and this brought us to a cash out payment from EUR 6.3 million. The cash flow from operating activities is better than last year. We have a higher net income for the period. We have a depreciation of non-current assets, which went a bit up. In total, the cash flow from operating activities went up very good. The reason for that is that we have a very high OpEx for bringing the new customers in the financial services sector, such as NRW.BANK and other banks in the FIS sector. This costs us last year, a lot of money we didn't need again this year. We have a good development in this field and will have it also in the future. The very focus of our board is to avoid these high investments in OpEx for the new projects. We have installed a new system, which helps us exactly to determine what does a new customer cost. It will help us to avoid this negative thing last year happened with FIS. Next page, please. M&A history. There is something to say for the new two companies we bought, dna. The story behind dna is that we are negotiating since more than one year with this company. The reason for that was that they are working mainly for one big customer, which is the FI, Finanz Informatik, and they do IT services for Finanz Informatik. This adds very good skills to our workforce in the financial sector. We negotiated last year the contract to buy dna, and there was no long-lasting contract with the end customer. We said, okay, we can close the deal only if we have a long-lasting contract with the end customer. The end customer needed around one year to figure out, to negotiate the contract with the dna, so that we have been able in April 2021 to close the deal, which brings us now a very high security with this long-lasting customer contract for more than five years from now for dna. dna will develop very fast because the customer, FI, together with the DATAGROUP infrastructure, over complete Germany, will give us the ability to work with FI over the whole country. In this business case, we see very good opportunities for the future. You will see extremely good figures from this business in the future. A very interesting new company is URANO. This company we bought in May 2021, Here was the negotiation process very fast, very short. I saw the former shareholder of URANO at the December 30th, 2020, We could close the deal in May 2021 or so. Only four to five months negotiation for such a quite big deal. URANO Informationssysteme GmbH, we bought 70% of the shares in the first step, We have a purchase option for the remaining 30% after two years. This is based on valuation model we figured out with the former shareholders and which give us as DATAGROUP more security that we don't pay too much money for the company. For both of us. Also the old shareholders and the new shareholder, DATAGROUP, gives this type of deal a high security. URANO provides IT services with nearly 300 people and is active in the private and public sector. Company was founded 30 years ago and is a very reliable partner for the public sector in Hessen and Rheinland-Pfalz for many years. This is very interesting for us because it strengthens the presence of DATAGROUP in Hessen and Rheinland-Pfalz and also interesting solutions are added to our portfolio, for example, in the school sector. School sector is one sector we expect a fast-growing IT infrastructure founded by the public sector. This we want to address with URANO. Okay, next page, please. dna, I told you before, we have with dna 104 employees, fast-growing the number of employees, and we generate revenues in the high single-digit million range, and it is a very profitable acquisition. Next page, please. Okay. At the moment, DATAGROUP share is not the top of our peer group, but we hope that we will be again one of the really best in the sector. We see a very brilliant future for our company, and so I hope we can make a good story, and I'm sure that we can, and I'm sure if you invest in DATAGROUP, it will be a very good investment for the future. Next page, please. Okay, upcoming events. I don't want to read down. We have a lot of new conferences. We see the Q3 figures at the August 24th. We are working very hard on the success of DATAGROUP. Next page, please. Your contact person for investor relations is Claudia. Claudia is helping you with any questions you might have. Now I will be glad to answer your following questions. Thank you. Thank you, Mr. Schaber. The floor is now open for questions. If you would like to ask a question, please press the hand symbol. You will then be unmuted and able to ask your question. Alternatively, you can type your question into the question box. We have three questions from Mr. Edwin de Jong. The first is, what was organic growth in Q2? In Q1 it was 10%. I will give that question to the back office. The second question is, productivity went up in the first half year. Is that going to be lower in the second half year as the lockdowns fade away? No, I will answer it directly. We don't see a bad development of our efficiency. We see that it is growing, in the future, over a longer period. It might have sometimes a bit a swing, but in total, we will increase our productivity. The third question is, will OpEx go up as well, as consultants are able to travel again? No, we don't have a direct relation with the travel of the consultants. OpEx is based on how much we have to work in a project to bring it to a recurring situation. That will grow a bit if we have bigger new projects. In total, we will remain on a low level like we showed it now. It's always a bit a swing. Some projects need a bit more OpEx. Most of them we are aiming, we focus on these projects who need lower OpEx. It is in total, we are on a good way in this field. The next question is from Mr. Knut Woller. Yeah. Yeah. Hello. Hopefully you can hear me, and thanks for- Yeah. -taking my questions. The first one would be, can you give us the consolidation effect of URANO and dna in the current year? I come to at least around EUR 25 million revenue effect. The EBITDA effect should also be more than EUR 2 million based on my estimates. Is that a right ballpark? The EBITDA effect, yes. The revenue effect we cannot give you exactly because we are consolidating only five months, not six months. There is no exact projection how the revenue will develop of these both companies because it's also a bit swinging around. We cannot count the yearly revenue that divides through 12. We have some seasonal effects. Would be better to see around 20, probably a bit lower than 20 in revenues. The EBITDA effect is okay, you expect. Okay. Thank you. A technical question regarding the tax rate. It seems that you had a tailwind from the dna acquisition that you could use tax loss carry forward. Yeah. Can you give us an idea about the expected tax rate in the current fiscal year, and how we should think based on the current scale and scope regarding tax rates in the coming years beyond 2020-2021? Mr. Woller, this is a very hard question we also ask ourselves. We are not really sure how this effect will bring down at the balance sheet. We have a high position of tax possibilities, let me say it in this way. It depends a bit how good dna is working. We are putting dna under the FIS. We can realize some tax effects from this. We are not exact. We are not able to give an exact projection, but it will be very good, let me say. Let's come probably in the Q3 results we know it exactly or more exact like now. It will not going, but it will bring our tax rate down in total and in percentage, I cannot say at the moment. Got it. Just to clarify, Mr. Schaber, is that something that is only impacting this year or also the years after? Yeah. A part, let me say 50%-60% we will see this year, and next year we will see also a 40%-50%. Thank you. It swings around this. Regarding the operating cash flow, it was quite good in H1. Was there any tailwind from the acquisitions you did? If so, can you please quantify it? No. Nothing, no figures of the acquisitions are here in these figures. Yeah. Oh, okay. It is- That's okay. -completely operating based. Okay. On the CapEx side, if I remember correctly, in the Q4 call, you expected around EUR 18 million CapEx in the current year. You're now at EUR 1.6 million. Is the EUR 18 million still a valid number, or is that going to be below this fall? We hope that we can do it below. We are not sure at the moment. We are working very hard. You see it at the figures. We are working very hard on the CapEx. We are shifting in invest. Some of these shifts have had big effects that we went down so far. It can be that some of this shifting comes up in the second half. We are not sure at the moment. It depends also on delivery of the equipment, and it depends on how fast we can increase the new projects, how we can realize the new projects. Would the EUR 18 million still be something that we should put in our models? Let me answer that later. I give that question please to the back office. Mm-hmm. Okay. The last question would be, you made some provisions last year, or quite substantial provisions. Yeah. Can you share with us whether you're planning to resolve the provisions from last year, and to which extent that is factored into your guidance for this year? Yeah. Last year, we made a model of three years period with these FIS provisions. We did for the actual year, let me say around EUR 5 million, EUR 5.5 million. Next year, EUR 3 million, and again, another EUR 2 million also in the third year. This year, in these half year figures, we have had EUR 2.2 million used the provisions. We have another more than EUR 3 million we can use if we need it this year, in the second half year. The remaining provisions, I think you also did quite substantial provisions outside of this last year, which could of course be reversed this year. Is that factored into your guidance, Mr. Schaber, or not? Normally, we use what we provide, but this question I have to pass to the back office also. Mr. Woller, can you say which provisions do you mean? Yes, I will do so. Yeah. We do it then off the record. Okay. Okay. Thank you. Thank you very much. Thank you. Okay. The next question is from Mr. Andreas Wolf. Hi. Thank you for taking my question. Can you hear me? Yeah, very good. Yes. Thank you. My question is in general on the share of the public sector within your revenues. Obviously, it had a counter-cyclical effect this year, maybe last year as well. Maybe you could elaborate on this topic. Is there something like an order backlog that you're measuring, order book that you can share the view about with us? Lastly, on the measures that you have implemented to monitor new clients, could you provide some more insight into how these measures are created, what these are, just to give us more comfort here? Thank you. Yeah. First, the public clients. What we see is that public clients spend much more money in IT infrastructure and in IT solutions than they did before. Money is spent easier and in bigger amounts. This is surely based on the COVID thing. What we see is that there is a mind change in total. We don't see a very fast reduction of these spendings. In opposite, we see that spendings will go up over the time. The one-time COVID effect might swing a bit down. In total, we will see much more spending in public sector than we did before. DATAGROUP is now positioned very well with URANO Informationssysteme and with our Stuttgart branch. We are now one of the biggest suppliers for the public sector in infrastructure solutions in Germany. We are very good also in services. Not in hardware delivery, but in services. Okay. The second question was how we measure our order intake. What we are doing at the moment, one year ago, we implemented [Non-English content], Sales Chief Officer. This brings us to a better view how sales in total are going. What we see is that the thing I always promised years before, that we grow within our customership very good. This is also surely based on the different new idea that customer has to invest more money in a good working IT infrastructure. Also, what we see is that there is a lot of more investment in security things. We accelerate the development of our Security Operations Center, SOC, and all these other things around security. That brings us to a faster organic growth in our existing customership, but also in very interesting new customers. For example, we did a big new customer, HELLA is not yet in the figures to see, but it will bring significantly growing revenues in the current facility of DATAGROUP. This is a big customer, and after the FIS disaster, I was very afraid against big customers. We did very hard work to make the new HELLA contract profitable and to make it secure. We are sure that we can manage this contract very well. This shows you that on the sales side, we expect fast growth for the next period. Let me see. Does that answer your question, Wolf? Yes. Thank you. I might have missed the answer to my next question. Were there any special effects resulting from recent acquisitions in the bottom line? I guess no, and probably there won't be any in the upcoming quarters. Just to be sure on this side, could you also provide the answer here? On the CapEx side, have you found new ways to organize CapEx, or is this just project related that you need less investments for the projects that you are carrying out, less data center investments, et cetera? Thank you. Okay. First of all, there is no hocus pocus in our CapEx side. It is really what you meant. We have lower CapEx because we did a bit different type of projects. We did not make these huge projects with DATAGROUP-owned hardware. We focus on these type of projects in the future. We don't want to invest these huge amounts of money into a customer's hardware, the customer-related hardware from two reasons. One reason is to held the CapEx down, to held it low. The second reason is that the profitability in dedicated hardware investments is not as good as it is in our cloud centers. We can have a much better efficiency if we invest in our cloud centers than if we invest in dedicated customer situations. First question was, are there any special effects out of the acquisitions of dna and Portavis and URANO? What we see now, we are not completely through with the PPA allocation. What we can see is a smaller effect from dna, could be a lucky buy, but not very big, and URANO, there are no effects at the moment we see. Great. Thank you. Okay. The next question is from Tim Wunderlich. Yeah, good morning. Morning. Good morning, Mr. Schaber. My question is on the revenue with vaccination centers. Could you give me the number, how much that was in the first half of this year, in the first half of your fiscal year? How you expect this to develop going forward. I mean, is there a recurring component, or what does this look like? Thank you. Good question, Tim. Thank you. For the first half year, let me see. It's in our figures now, around EUR 6 million revenues, EUR 5 million-EUR 6 million revenues. What we expect for the second half is another EUR 3 million-EUR 5 million. It's not exactly designed now. What we expect is that not the vaccination centers, but similar solutions for health services will give us a recurring revenue stream over the next years. It will come a bit down. The main investment, which was around these two half years, last half year and actual half year, will come a bit down. It will be offset through new projects. So that we don't fear very hard going down figures in this sector. Okay. Makes sense. Yeah. Thank you. This is a bit of a follow-up, because your free cash flow looked quite nice in the first half of the year, and I would be interested in knowing, and this has been discussed before, partly. Operating cash flow looked good, but also you had very low CapEx. When we now, I think it was EUR 21 million of free cash flow you thus generated in the first half. Also my question would be how do you see this developing for the full year? Yeah. I cannot give you an exact answer as I figured out before. Some of the effects for these low CapEx in the first half year, I explained to you before, it was some kind of shifting investments, because of slow project organization phases and some other very reduced speed and more thinking how we can do it with lower spendings. Some of them will come in the second half year. Please do not expect a very high CapEx. We will be on a low level, but not as low as in the first half year. Okay. Makes sense. Thank you. Now we are almost done with the month of May. Can you give us an update on the current trading? How does the demand look over the last two to three weeks? Yeah. Very good. I cannot say what happens over the last two, three weeks, but we have now completed April and April figures are brilliant. Just brilliant. Okay. Thanks so much. That's it from my side. Thank you. We have a answer from the back office to the question of what was organic growth in Q2. Yes. Organic growth in Q2 was 5.4%. Okay. Very good. Thank you. The next question is from Mr. Yannik Siering. Hi. Thank you very much for taking my question. Just a quick follow-up. In Q1, we saw elevated material expenses. I think that was also related to the vaccination centers. Now in Q2, this was a bit lower again. Could you provide some color on what to expect on this for the remainder of the year, maybe also taking into account the acquisition of URANO, which probably has roughly 50% of hardware sales, maybe that also has an impact on your material expenses? That would be very helpful. Thank you. Yeah. Material expenses will go down, surely, if no vaccination centers are added and equipped. We have some million less investment in hardware and sales in hardware. I think we will come back to a level of around 20%. Let me say, no, it's around 15% from our revenues. We expect now, EUR 440 million in the total year, and it should be around between EUR 70 million and EUR 80 million in total hardware sales and trade sale in the whole year. Also, URANO will bring a bit more hardware sales, but the company is developing very fast to a, let me say, more pure service provider. They come from a classical system house business, and they are developing into a service provider business. This will go up. We expect year-over-year, 5% more services, so that we can expect that we have in a few years the level of DATAGROUP in total might be a bit more. DATAGROUP has companies like Bremen and like Stuttgart, which are in the 30% or 40%, but some of our companies have 100% services, so it will count up to the quite normal DATAGROUP figures in the future. We don't want to change to a hardware reseller. Does that answer your question? Yeah. Thank you very much. Good. Thank you. We now have a follow-up question from Mr. Knut Woller. Yeah. Thank you. Just to clarify, on the EUR 5 million-EUR 6 million revenues from the vaccination center, was that relating to service and maintenance, or did that include the hardware contribution, Mr. Schaber? It is including hardware. I'm just trying to get the numbers right. If I look at material expenses being down EUR 11 million quarter-over-quarter and trade revenues just down roughly EUR 8 million, so how is that aligned? Yeah, sure. Major hardware sales in Q1? Yes, we have had surely some other hardware sales in the customer side. If you have to move your complete infrastructure to make your employees able to work from home offices, you have to invest in hardware for them. We delivered hardware for our customers in this way. It's a mixture of all. The vaccination centers, you could see that we deliver only a piece of hardware. The main part of the hardware used in these vaccination centers is not delivered via our books. We install it, we make services there, and a bit of hardware. For example, some printers and some other things, but not the main computer. Okay. Thank you. Are there any further questions? Please type your question into the question box or let us know via the hand signal. Right. At the moment, we have no further questions. Thank you for participating in our conference call. The call will be made available on DATAGROUP's website. Very good. Thanks for your questions and thanks for your interest. Thank you. Bye-bye.