3U HOLDING AG: 3U plans double-digit organic revenue growth in 2022

Marburg (pta007/30.03.2022/07:00 UTC+2)

• 2021 forecast essentially achieved – revenue at the lower end and adjusted result at the upper end of the forecast range
• Adjusted for one-off expenses for M&A and IPO preparations, operating EBITDA margin reaches 22.1 %
• Dividend proposal of EUR 0.05
• External factors: Renewable Energies weaker due to weather conditions; global supply chain difficulties in the construction sector
• Plans for sustainable, profitable growth

Marburg, 30 March 2022 – 3U HOLDING AG (ISIN DE0005167902) is reporting on its consolidated financial statements and the results of the financial year 2021. The publication of the full Annual Report on the financial year 2021 has been delayed by a few days due to necessity of transferring to the ESEF data format, which is the precondition for the subsequent approval and adoption of the financial statements by the Supervisory Board. Inasmuch, the financial statements are therefore still provisional.

As expected, consolidated revenue decreased by EUR 5.11 million (8.4 %) to EUR 55.94 million, down from EUR 61.05 million in the previous year. The decline is essentially due to the disposal of parts of the company in the fourth quarter of the financial year 2020 which generated revenue of EUR 8.02 million in the financial year 2020. A counter trend emanated from the initial consolidation of two companies – acquired in the second half of the year – in the fourth quarter of 2021, which contributed around EUR 0.99 million to revenue in the ITC segment and the Group. The 3U Group therefore achieved organic growth of 3.6 % in the financial year 2021. In comparison with the previous financial year, the development of organic growth was hampered by a significantly lower level of wind yield from the wind farm portfolio, as well as by supply bottlenecks in the construction sector, which also affected the SHAC segment.

These circumstances are also reflected in the segments’ development. Including the newly acquired companies, the ITC segment generated revenue growth of 24.1 %, as opposed to the SHAC segment and the Renewable Energies segment which recorded declines of 18.6 % and 31.1 % respectively.

Other income in the financial year 2021 mainly results from disposals of part of the Adelebsen property and of office space in the InnoHubs building complex, currently under construction Würzburg. At EUR 6.86 million, income is 28.5 % higher than in the previous year (2020: EUR 5.34 million).

The cost of materials ratio (cost of materials as a percentage of revenue) came in at 52.4 % compared with the previous year’s period when it stood at 54.4 %. The share of personnel expenses in revenue (personnel expenses ratio) rose significantly to 26.8 % in the financial year 2021, up from 21.5 % in 2020. This increase is essentially explained by the ongoing recruiting of personnel on the back of growth and takes account of greater staff requirements in cloud computing in all areas of tasks right up to Management Board level, as well as gaining new employees through the acquisitions.

The share of other operating expenses in revenue was also significantly higher at 17.8 % in the financial year 2021 (2020: 13.6 %). This position comprises the majority of costs incurred by preparing company acquisitions and a possible IPO of subsidiary weclapp SE. Accordingly, earnings before interest, taxes, depreciation and amortisation (EBITDA) in the financial year 2021 stood at EUR 11.27 million, which is EUR 0.28 million (2.5 %) lower compared with the previous year’s figure (2020: EUR 11.55 million). By contrast, the EBITDA margin (EBITDA in relation to revenue) increased from 18.9 % in 2020 to 20.1 % in the reporting year, a development mainly due to lower revenue and the higher level of other operating income.

Personnel expenses and, in particular, other operating expenses, include costs amounting to EUR 1.08 million (2020: no one-off expenses) for preparing for company acquisitions and a possible IPO of subsidiary weclapp SE. Adjusted for the aforementioned one-off expenses, EBITDA is calculated at EUR 12.35 million and the adjusted EBITDA margin comes in at 22.1 %.

The consolidated result for the financial year 2021 attributable to shareholders of the parent company therefore reflected the forecast: At EUR 2.92 million, it fell EUR 0.35 million short of the previous year’s figure of EUR 3.72 million. At this juncture, the fact that that, without the one-off expenses incurred for the preparation of company acquisitions and a possible IPO of subsidiary weclapp SE, a higher consolidated result would have been generated should also be taken into account.

Dividend proposal: EUR 0.05 with no tax reduction

In view of the further positive development of business within the Group, the Management Board and the Supervisory Board will put forward a proposal to the Annual General Meeting to pay dividend of EUR 0.05 per share (dividend payment 2021: EUR 0.05). Dividend would be paid from the tax deposit account with no deduction of tax.

Segment results

The ITC segment achieved a share of 42.9 % (2020: 31.7 %) in consolidated revenue, the Renewable Energies segment 11.2 % (2020: 15.0 %) and the SHAC segment 48.2 % (2020: 54.3 %). The difference between the sum total of segment sales revenue and 100 % of consolidated sales revenue is attributed to Other Activities.

In comparison with the previous year, the ITC segment lifted its revenue by 24.1 %, from EUR 19.33 million to EUR 23.98 million in the financial year 2021.

Telecommunications generated EUR 11.13 million in sales revenue, unchanged from the year-earlier level (2020: EUR 11.20 million).

The cloud computing business was given a new operational and balance sheet structure due to the acquisition of two subsidiaries. The revenues, expenses and earnings of the two companies were included by way of consolidation in the consolidated statement of income of the newly established subgroup of weclapp SE for the period from October to December 2021.

In the financial year 2021, the subgroup achieved consolidated revenue of EUR 11.98 million (2020: EUR 7.33 million), reflecting growth of 63.5 %. Sales revenue for this period was as follows: FinanzGeek whose product still has to be launched on the market contributed to a minor extent, while ITscope contributed EUR 1.17 million and weclapp SE EUR 10.99 million (2020: EUR 7.33 million), marking revenue growth at single company level of 49.8 %. In the process of consolidating the subgroup, sales revenue was eliminated in an amount of EUR 0.18 million. The segment’s earnings trend overall was significantly impacted by one-off expenses of EUR 1.08 million in connection with preparations for company acquisitions and a possible IPO of subsidiary weclapp SE (2020: no one-off expenses).

This resulted in a decline of 9.2 % in this segment’s EBITDA to EUR 4.51 million, down from EUR 4.91 million. The EBITDA margin (EBITDA as a percentage of revenue) dropped from 25.7 % to 18.8 %. Adjusted for one-off expenses, EBITDA stood at EUR 5.59 million, corresponding to an EBITDA margin of 23.3 %.

The power generated by the portfolio of wind farms was negatively impacted by the fact that winds were unusually low in all of our wind farm locations in 2021. All in all, revenues dropped from EUR 9.13 million in 2020 to EUR 6.29 million in the reporting year. The previous year still included sales revenue of EUR 1.06 million from operating the Lüdersdorf wind farm, however. EBITDA therefore declined from EUR 8.80 million in the previous year to EUR 4.63 million in the financial year 2021.

Revenue in the SHAC segment dropped from EUR 33.14 million to EUR 26.96 million. Along with the absence of sales revenue from the company that left the Group in 2020, the global supply chain crisis and the associated difficulties in procuring goods caused a significant decline in sales revenue by 18.6 %. This situation negatively impacted sales revenue generated from e-commerce in Group company Selfio GmbH in particular, which fell by 8.8 % to EUR 21.59 million (2020: EUR 23.67 million). The SHAC segment delivered EBITDA of EUR –0.53 million in the reporting year compared with a positive EBITDA of EUR 1.09 million in 2020.

EBITDA in Other Activities/Reconciliation amounted to EUR 2.65 million (2020: EUR –3.31 million), contributing earnings EUR 0.57 million to the consolidated result in the financial year 2021 compared with a negative result of EUR 3.22 million in the previous year.

Cash flow and financials

Operating cash flow was negative at EUR –9.46 million in the reporting year (2020: cash inflow of EUR 4.78 million). The sharp increase in current trade receivables, mainly resulting from the sale of office space in the Würzburg construction project as well as advance payments in the SHAC segment and business expansion in the ITC segment, is reflected in cash outflow.

Cash flow from investing activities was largely determined by acquisitions in the cloud computing business. Cash outflow for the purchase of consolidated companies and other business units came in at EUR 13.24 million.

The cash flow from financing activities generated a cash inflow of EUR 9.23 million (2020: cash inflow of EUR 5.30 million). Payments for the scheduled and unscheduled repayment of loans and leasing liabilities as well as to shareholders of 3U HOLDING AG and to minority interest are offset by incoming payments from taking out bank loans worth EUR 14.95 million (2020: EUR 8.15 million).

Total assets stood at EUR 119.05 million on 31 December 2021 (31 December 2020: EUR 85.90 million) and have therefore risen by EUR 33.15 million compared with the year-earlier reporting date. The balance sheet extension is essentially attributable to the increase in intangible assets following the acquisition of two companies. This is set against higher non-current financial liabilities and equity which have risen by EUR 10.11 million.

Along with goodwill of EUR 18.35 million (31 December 2020: EUR 0.60 million), non-current assets of EUR 69.85 million (31 December 2020: EUR 39.20 million) comprise in particular intangible assets taken over in the context of acquiring the new companies which have joined the Group. Among other aspects, this includes the brand rights, customer relationships and the cloud platforms, which together total EUR 8.03 million. As of 31 December 2021, current assets stood at EUR 49.20 million (31 December 2020: EUR 43.53 million), reflecting an increase of EUR 5.67 million compared with the 2020 reporting date. Cash and cash equivalents of EUR 12.72 million represented 25.8 % of current assets as of 31 December 2021. On 31 December 2020, cash and cash equivalents stood at EUR 26.42 million, accounting for 60.7 % of current assets.

The key financials remained at a satisfactory level at the end of the financial year 2021. Owing to borrowing, the debt-to-equity ratio increased from 65.2 % as of the reporting date in 2022 to currently 91.7 %. The financial liabilities exceeded the cash and cash equivalents by EUR 18.2 million as of 31 December 2021 (31 December 2020: net cash of EUR 9.32 million). At the same time, working capital rose by 8.6 % and had reached a level of EUR 34.21 million by the reporting date (31 December 2020: EUR 31.51 million).

The continued sound equity ratio stood at 52.2 % on 31 December 2021 (31 December 2020: 60.5 %). Along with the profit available for distribution in the financial year 2021, the increase in the absolute amount of equity which rose by EUR 10.11 million to EUR 62.11 million (31 December 2020: EUR 52.0 million) resulted from other companies joining in the ITC segment as well as from changes in capital reserve, largely following a capital reduction in subsidiary weclapp SE carried out in the context of preparations for this company’s IPO.

Plans for sustainable, profitable growth

The Management Board anticipates a double-digit increase in consolidated revenue which will derive support from the strong organic growth of our operating units in the financial year 2022. Sales revenue in 2022 is expected to settle within a range of between EUR 65 million and EUR 70 million. Moreover, earnings in the single-digit million range from the disposal of assets have been incorporated into planning. In view of the measures introduced to strengthen profitability, on the one hand, and the higher level of expenses for expanding cloud computing, on the other, the Management Board anticipates earnings before interest, taxes, depreciation and amortisation of EUR 10 million to EUR 12 million. Profit of the 3U Group is therefore expected in a range of between EUR 2 million and EUR 4 million.

The actual performance of business may be higher or lower than forecast here due to the acquisition of companies by 3U HOLDING AG or other Group companies in the cloud computing business or from selling operating units of the Group. The resulting effects can only be planned for to limited extent, however.

Predicting with any degree of certainty to what extent the war in Ukraine or the recently more stringent economic restrictions imposed to combat the COVID-19 pandemic will impact on business activities is not possible.

"The financial year 2021, was one of light and shadow," commented Michael Schmidt, Spokesman of 3U HOLDING AG’s Management Board. "We achieved our forecast, made some fine progress and generated value, true to our company’s purpose. We were, however, constrained by external factors which we were unable to foresee or to influence to any great degree: lower power yield due to weather conditions, supply bottlenecks in the wake of COVID-19 lockdowns, and the plunge in the stock market value of technology shares. Unfortunately, we have had to temporarily halt the intensive preparations for a possible initial public offering of weclapp SE. But even without a launch on the stock market, we are generally satisfied with the result of the financial year and plan to pay dividend to enable our shareholders to participate in our success again. For the coming year, we have long since paved the way forward with our operations – for sustainable, profitable growth in all segments: ‘The year 2022 will be a good year!’"

Annual report

The publication of the full Annual Report on the financial year 2021 has been delayed by a few days due to necessity of transferring to the ESEF data format, which is the precondition for the subsequent approval and adoption of the financial statements by the Supervisory Board. The report will be made available on the company’s website at www.3U.net under the "Investor Relations/Reports" heading.

For further information:
Dr. Joachim Fleïng
Investor Relations
3U HOLDING AG
Tel.: +49 (0)6421 999-1200
Fax.: +49 (0)6421 999-1222
email: IR@3U.net

About 3U:

3U HOLDING AG www.3U.net) was founded in 1997 and has its headquarters in Marburg, Germany. It is the operating management and investment holding company at the head of the 3U Group. It acquires, operates and sells companies in the three segments of Information and Telecommunications Technology (ITC), Renewable Energies (EE) and Sanitary, Heating and Air Conditioning Technology (SHAC). The 3U Group has successful and profitable business models based on megatrends in all three segments. It continues to expand its business activities dynamically, particularly in its strongest growth areas of cloud computing and e-commerce, in which it is striving to achieve leading positions in the market.
3U HOLDING AG shares are traded on XETRA, Tradegate and on German regional stock exchanges (ISIN: DE0005167902; stock exchange symbol: UUU).

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Emitter:	3U HOLDING AG Frauenbergstraße 31-33 35039 Marburg Germany
Contact Person:	Dr. Joachim Fleing
Phone:	+49 6421 999-1200
E-Mail:	IR@3U.net
Website:	www.3u.net
ISIN(s):	DE0005167902 (Share)
Stock Exchange(s):	Regulated Market in Frankfurt; Free Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate