Munich, October 26, 2020 - In the first nine months of 2020, Allgeier SE's (ISIN DE000A2GS633, WKN A2GS63) business is largely resilient to the consequences of the COVID-19 pandemic, with stable revenue development at the previous year's level. Due to intensive cost management and the scheduled reduction of business with lower margins, EBITDA achieved was above the original target for the first nine months of the current fiscal year. Net income, especially in the second quarter, was in part positively influenced by temporary cost control measures in the course of the COVID-19 pandemic.

Business development in the first nine months of 2020

According to preliminary figures, revenues for Allgeier Group as a whole (continuing and discontinued operations) amounted to EUR 585.4 million in the first nine months of 2020 (January 01, 2020 - September 30, 2020) (previous year: EUR 584.2 million). Consolidated gross profit (defined as total operating performance less cost of sales and personnel expenses directly attributable to sales) increased by 7 percent to EUR 181.3 million (previous year: EUR 168.9 million), corresponding to a gross margin of 30.9 percent (previous year: 28.9 percent).

Adjusted Group EBITDA for the period (EBITDA before effects that are operationally qualified as extraordinary or out of period) increased by 53 percent to EUR 78.3 million (previous year: EUR 51.0 million). Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) increased by 51 percent to EUR 67.5 million (previous year: EUR 44.6 million). Consolidated EBIT (earnings before interest and taxes) increased by 85 percent to EUR 40.5 million (previous year: EUR 21.9 million).

* Consolidated Group according to IFRS (continuing and discontinued operations), in EUR million (unless otherwise stated)

On September 24, 2020, the Annual General Meeting of Allgeier SE approved the spin-off of the global technology consulting and software development business, bundled under Nagarro SE, from Allgeier SE. Accordingly, Nagarro SE, which is intended to be spun off, is shown under discontinued operations as held for spin-off.

For the Allgeier SE's continuing operations remaining after the spin-off of Nagarro SE, revenues in the first nine months of 2020 decreased by 8 percent to EUR 264 million (previous year: EUR 288 million) compared to the same period of the previous year. This decline is due to the planned waiver of low-margin sales in the IT personnel services sector (Allgeier Experts), which recorded a EUR 33 million reduction in revenues in the first nine months of 2020 compared with the first nine months of 2019. Adjusted EBITDA from continuing operations increased by 93 percent to EUR 20.3 million (previous year: EUR 10.5 million). EBITDA from continuing operations increased by 149 percent to EUR 14.3 million in the reporting period (previous year: EUR 5.7 million). EBIT from continuing operations amounted to EUR 2.9 million (previous year: EUR -2.9 million).

Revenue of Nagarro SE, shown as held for spin-off operations, increased by 9 percent to EUR 321 million (previous year: EUR 296 million). Adjusted EBITDA for Nagarro SE increased by 43 percent to EUR 58.0 million (previous year: EUR 40.5 million). EBITDA increased by 37 percent to EUR 53.3 million (previous year: EUR 38.9 million). EBIT increased by 51 percent to EUR 37.6 million (previous year: EUR 24.9 million).

Business development in the third quarter of 2020

In the third quarter of 2020 (July 01, 2020 - September 30, 2020), revenue for Allgeier Group as a whole (continuing and discontinued operations) fell by 6 percent year-on-year to EUR 190.7 million (previous year: EUR 203.5 million) according to preliminary figures. Consolidated gross profit rose by 1 percent to EUR 63.5 million (previous year: EUR 62.8 million), corresponding to a gross margin of 33.2 percent (previous year: 30.8 percent). Adjusted Group EBITDA rose by 37 percent to EUR 30.2 million (previous year: EUR 22.1 million). Consolidated EBITDA increased by 28 percent to EUR 24.2 million (previous year: EUR 18.9 million). Consolidated EBIT rose by 33 percent to EUR 15.1 million (previous year: EUR 11.3 million).

In Allgeier SE's continuing operations, revenue in the third quarter of 2020 fell by 14 percent to EUR 85.3 million (previous year: EUR 97.3 million). The main reason for this was the planned reduction of EUR 15 million in revenues from IT personnel services compared to the third quarter of 2019. Adjusted EBITDA from continuing operations increased by 83 percent to EUR 9.6 million (previous year: EUR 5.2 million).

In Nagarro SE's held for spin-off operations, revenue in the third quarter of 2020 was EUR 105.4 million, which corresponds to the third quarter of the previous year (previous year: EUR 105.2 million). Adjusted EBITDA for Nagarro SE's operations increased by 23 percent to EUR 20.3 million (previous year: EUR 16.5 million).

Key figures of the consolidated balance sheet as of September 30, 2020

According to preliminary figures, adjusted consolidated equity (adjusted by temporary accounting caused by IFRS requirements as of September 30, 2020 due to the spin-off of Nagarro SE) amounted to EUR 161 million as of the balance sheet date September 30, 2020 (December 31, 2019: EUR 166 million). The change in equity is determined by the net income for the year, the acquisition of shares from non-controlling shareholders and charges resulting from currency translation as well as the distribution of a dividend of EUR 5.7 million in September 2020. At the end of the third quarter of 2020, the Allgeier Group had cash and cash equivalents of EUR 125 million at its disposal (December 31, 2019: EUR 97 million). The Group's net financial liabilities (including liabilities from rental and lease agreements) fell to EUR 140 million as of the reporting date (December 31, 2019: EUR 165 million). Non-current financial liabilities amounted to EUR 176 million (December 31, 2019: EUR 150 million). Total assets amounted to EUR 601 million as of September 30, 2020 (December 31, 2019: EUR 587 million).

Outlook towards the end of 2020

For the remaining fiscal year 2020, the Management Board of Allgeier SE expects the positive development of the first nine months to continue. Expected revenues for Allgeier Group as a whole (continuing and discontinued operations) for the full year 2020 are between EUR 779 and 789 million with a gross margin in the range of 30 to 32 percent. The expected adjusted EBITDA for Allgeier Group as a whole is EUR 98 to 107 million.

For Nagarro SE's held for spin-off operations, revenues of between EUR 427 and 433 million are expected for the full year 2020 with a gross margin in the range of 32 to 33 percent. The expected adjusted EBITDA for Nagarro SE's held for spin-off operations for the full year 2020 is EUR 72 to 77 million.

For Allgeier SE's continuing operations, the Management Board expects full year 2020 revenues to be between EUR 352 and 356 million with a gross margin in the range of 28 to 30 percent. The expected adjusted EBITDA for Allgeier SE's continuing operations for the full year 2020 is between EUR 26 and 30 million.

Notes

The voluntary interim information of Allgeier SE as of September 30, 2020 will be published on November 13, 2020 and can then be viewed at www.allgeier.com.

All figures mentioned were prepared in accordance with IFRS, are preliminary and have not been audited.

It is also pointed out that statements for periods after September 30, 2020 represent expectations of the Management Board based on assumptions and estimates. Future actual developments and future actual results may differ from these assumptions and estimates. Allgeier SE does not warrant or represent that future developments and future actual results will be consistent with the assumptions and estimates expressed in this ad hoc release.

This document contains supplementary financial figures - not precisely defined in the relevant accounting framework - which are or may be so-called alternative performance indicators. These supplementary financial indicators may have limited use as analytical tools and should not be used in isolation or as alternatives to the financial indicators presented in the consolidated financial statements and determined in accordance with applicable accounting standards in order to assess the financial position, performance and cash flows of Allgeier SE. Other companies that present or report alternative performance indicators with a similar designation may calculate them differently and may therefore not be comparable. For more information on the alternative performance indicators used by Allgeier SE, please refer to the Annual Report 2019.

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