Brockhaus Technologies expects another record year for revenue and earnings in 2023

• Fiscal year 2022 with revenue of €145.3 million and EBITDA of €50.0 million above forecasts
• Additional high value realization from the sale of shares in Palas: Sales proceeds of approx. €59 million received with potential purchase price tranches for 2023/2024 of up to €16.8 million
• Debt massively reduced & large financial reserves for further profitable growth: Cash & cash equivalents increased to €70.8 million, with free cash flow before taxes of €39.8 million and net debt to adj. EBITDA decreasing to 0.75
• Optimism for 2023: Increase in revenue to €165 to 175 million with EBITDA margin of 35%

Frankfurt am Main, March 31, 2023. Brockhaus Technologies AG (BKHT, ISIN: DE000A2GSU42) has generated record revenue and earnings in the financial year 2022. The continuing operations (i.e. without the subsidiary Palas, which was sold in November 2022) reported revenue growth before PPA of +38.1% to €145.3 million (2021 pro forma: €105.2 million). Adjusted EBITDA increased by +22.5% to €50.0 million (2021: €40.8 million), which corresponds to an adjusted EBITDA margin of 34.4% (2021: 38.8%). The forecast which has last been updated on November 24, 2022, was thus exceeded.

Before adjustments, revenue amounted to €143 million (+44% compared to 2021; €99 million) with an EBITDA of €47 million (+144% compared to 2021; €19 million) and an EBIT of €29 million (+899% compared 2021; €3 million). EBIT is particularly impacted by PPA amortizations of €14 million (2021: €14 million).

The very positive operational development despite difficult times and the high value realization associated with the successful sale of the 70% stake in the particle measurement specialist Palas confirm BKHT's business model and its ability to identify and successfully develop attractive companies with great growth potential. The sales proceeds of €59 million which have already been received as well as the possible subsequent purchase price tranches for the years 2023 and 2024 of up to €16.8 million are many times higher than the equity invested for Palas in 2018 of around €18 million.

"The financial year 2022 impressively proved how successful our business model is. The very good operational performance of the continuing subsidiaries and the high value realization resulting from the sale of Palas highlight our capability to identify, acquire and successfully develop attractive companies with high growth potential. Correspondingly, we are also very optimistic for 2023. Group revenue is expected to increase further to €165 to 175 million and the EBITDA margin to remain at a very high level of 35%," comments founder and CEO Marco Brockhaus on the development.

Very strong performance in both continuing segments

The subsidiary Bikeleasing (Financial Technologies segment), with its digital and highly automated B2B finance platform for the facilitation, financing and management of employee benefits, achieved another record growth in 2022, with a revenue increase (before PPA) of +50.5% to €109.2 million (2021: €72.6 million) and an adjusted EBITDA of €46.5 million (2021: €39.8 million). This corresponds to an adjusted EBITDA margin of 42.6%. Excluding the positive one-off effect of €7.1 million in connection with the disposal of lease receivables in 2021, revenue growth would have even been +66.9%.

In the reporting year 2022, Bikeleasing was able to increase the number of companies connected to its platform by +43% to 45,500 with approximately 2.5 million employees behind them. The number of newly facilitated company bicycles in 2022 rose by approx. +45% to 118,000. In addition to the dynamic development in the core market Germany, business in Austria was also strongly expanded with Bikeleasing having quickly developed into the market leader. The positive development is expected to continue in 2023. For the future, Bikeleasing's access to a large number of corporate customers offers so far untapped potential for the connection of further benefits for employee incentivization - such as the leasing of smartphones, tablets or computers.

The Security Technologies segment, consisting of IHSE and kvm-tec, which was acquired in 2021, also realized a substantial growth in revenue (before PPA) of +10.4% to €36.1 million in the fiscal year 2022. The segment's success is based on the further enhancement of existing KVM systems, the development and market launch of new joint hybrid solutions as well as further market potential from obtaining additional certifications in accordance with the highest IT security standards. In addition to accelerating customer demand in the Western industrialized countries, dynamic revenue growth was particularly achieved in the Americas region. The adjusted EBITDA margin was slightly below the previous year's level at 23.9%. Against the backdrop of the easing of travel and contact restrictions, demand for high-performance and secure KVM solutions to protect against the globally increasing cyber-attacks is expected to pick up noticeably in 2023.

The result of the subsidiary Palas (former Environmental Technologies segment), which was sold on November 24, 2022, is shown separately in the 2022 consolidated income statement of Brockhaus Technologies as "Result from discontinued operations".

Free cash flow strongly increased - debt massively reduced

Free cash flow before taxes increased from €10.6 million to €39.8 million in the reporting year 2022. As a result, the group's debt has been massively reduced in comparison to the previous year. Bikeleasing, for example, made voluntary early repayments of around €21 million on the acquisition financing from the company’s acquisition. In addition, loans of €15 million were fully repaid on the level of BKHT. The Group's net debt was thereby significantly reduced from €119.0 million to €37.4 million (0.75 times the adjusted EBITDA), which simultaneously had a positive effect on earnings per share and thus generated value for all shareholders.

Outlook 2023: Revenue expected to grow to €165 to 175 million and EBITDA margin of 35%

Despite high uncertainties due to geopolitical crises and banking turbulences, the management of Brockhaus Technologies AG is very optimistic for the financial year 2023 and expects another record year in terms of revenue and earnings. Revenue is expected to increase to €165 to 175 million due to further growth in both segments. Earnings are also forecast to increase further and the adjusted EBITDA margin to remain high at 35%. In the new financial year, the subsidiaries will be further strengthened, and the available financial resources will be used in the best possible way for selective organic and inorganic growth initiatives with the aim of continuing the build-up of the technology group. The company is already in promising talks in this regard.

The annual report for 2022 and further information on the company can be found at: https://ir.brockhaus-technologies.com/websites/brockhaustechnologies/German/3000/publikationen.html#reports

The earnings call for the financial year 2022 in English will take place today, March 31, 2023, at 16:00 (CEST). Interested parties can register for the call at the following link: https://webcast.meetyoo.de/reg/rL3NHcerosoL

About Brockhaus Technologies

Based in Frankfurt am Main, Brockhaus Technologies AG (BKHT, ISIN: DE000A2GSU42) is a technology group that acquires high-margin, high-growth technology and innovations champions with B2B business models in the German Mittelstand. With a unique platform approach and a long-term horizon, Brockhaus Technologies actively and strategically supports its subsidiaries in achieving profitable long-term growth, both across industries and internationally. At the same time, Brockhaus Technologies offers a gateway into these non-listed German technology champions, which are otherwise inaccessible to capital market investors. For further information, please visit www.brockhaus-technologies.com

Contact information

For investors:

Paul Göhring

Phone: +49 69 20 43 40 978

Fax:  +49 69 20 43 40 971

E-Mail:  [email protected]

For media:

GFD - Gesellschaft für Finanzkommunikation
Phone:  +49 69 97 12 47 33

Fax:  +49 69 97 12 47 20

E-Mail:  [email protected]

Consolidated key figures (pro-forma)

* Prior-year figures have been adjusted due to the discontinuation of a business segment

** The net debt in the 2021 financial year includes financial liabilities of Palas and is to be viewed in relation to the adjusted EBITDA 2021 including Palas (adjusted EBITDA = €48,180 thousand).