Yahoo Finance

• Total Revenue: $300.5 million, a growth of 36% year-over-year.

• Organic Growth: 22%, contributing $50 million more.

• EBITDA: $39.2 million, a 24% increase from the previous year.

• EBITDA Margin: 13%, a slight decrease due to changes in activity mix and investments.

• Operating Profit (EBIT): $25.5 million, representing 8.4% of total revenues.

• Net Profit: $15.9 million, a 3% increase from the previous year.

• Dividend Proposed: 0.25 per share, consistent with the previous year.

• Smart Solution Revenue Growth: Nearly 50%, contributing significantly to EBITDA margin.

• Digital Advisors Growth: 41% with a 20% margin increase.

• R&D Investment: Increased by 65% year-over-year.

• Adjusted Net Debt: 91 million as of December 31, 2024.

• Gross Margin: 33.5% of revenues, down from 36.2% in 2023.

• Adjusted Net Profit: 20.9 million, up 24% from 2023.

• Q4 Revenue: $85 million, a 31% increase from Q4 2023.

• Q4 Net Profit: $3.9 million, down from $5.7 million in Q4 2023.

• Warning! GuruFocus has detected 3 Warning Signs with STU:TXE.

Release Date: March 17, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• TXT e-solutions SpA (STU:TXE) reported a strong revenue growth of 36% in 2024, reaching $300.5 million, with significant contributions from both organic growth and M&A activities.

• The company achieved a 22% organic growth, which is well above the market average of 5% for the ICT sector, indicating robust internal performance.

• The Smart Solutions division experienced a remarkable growth of nearly 50%, contributing significantly to the company's EBITDA margin.

• TXT e-solutions SpA (STU:TXE) continues to expand its international presence, with 25% of total revenue coming from international markets.

• The company has a strategic focus on high-growth sectors such as aerospace, defense, and public sector, which are expected to drive future growth.

Negative Points

• The EBITDA margin decreased to 13% due to changes in the revenue mix and increased investments in commercial and R&D activities.

• Net financial debt increased significantly to 91 million, driven by substantial M&A activities, which may limit financial flexibility in the short term.

• The gross margin declined from 36.2% in 2023 to 33.5% in 2024, partly due to non-core activities with lower margins.

• The net profit growth was modest at 3%, impacted by higher financial expenses and a higher tax rate compared to the previous year.

• There is a potential risk associated with the company's increasing exposure to the public sector, which is known for longer payment terms and could affect working capital.