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Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Wiit First Quarter 2021 Financial Results Conference Call. [Operator Instructions] At this time, I would like to turn the conference over to Alessandro Cozzi, Chief Executive Officer of Wiit. Please go ahead.
Good afternoon, and thanks, everybody, for joining in our conference call of Wiit. This morning, the Board of Directors of Wiit approved the results of the first quarter 2021 -- of course, we are happy for the results you can see in our presentation. I start with the highlights and in the second part in this cover Q&A.
Highlights, the consolidated adjusted revenue was EUR 17.7 million compared with EUR 11.2 million previous year, plus 58%, mainly thanks for organic growth and the contribution of myLoc, our German business from participation and acquisition of new logo of the new customer. Consolidated EBITDA was EUR 7.2 million compared with EUR 4.1 million last year, plus 76.5%. And of course, you can see the [ accounts ] of scale we can generate in our model of business. And because our assets -- our operational rate at the center is roughly 50%, and we can increase our profitability in the first quarter. The EBITDA-margin revenue was 40.3% of the revenue. At EBIT level, the EBIT adjusted was EUR 4.1 million compared with EUR 2.2 billion this year and is part of 23.2% of the revenue. Adjusted net profit was EUR 3.2 million compared with EUR 1.6 million last year.
Net debt, including the negative impact of IFRS 16 for the rent of the space of EUR 7.9 million was EUR 93.9 million compared with EUR 95.6 million of the end of last year. In this value, we include all the acquisition of myLoc for EUR 55 million and not considering the actual value of all the treasury share this value after the -- by end of March was EUR 24.5 million. You can go directly to the important breakdown of the revenue and the contribution of myLoc in the chart Page #5, you can see EUR 4.7 million was the revenue in our business in Germany and EUR 2.4 million EBITDA margin of myLoc, 51.5% of the revenue and the EBIT was EUR 1.4 million, exactly 31% of the revenue. So we are very happy for the results of the acquisition in Germany. This is our first acquisition abroad and these results confirm the core strategy to enter in the main European market for the cloud business.
You can go to the Page #6, revenue adjusted increased 58.5% compared to last year. It's a good result has been achieved, mainly driven by organic growth, plus 13%. Organic continue this quarter to grow very, very fast. And I [indiscernible] the contribution of myLoc for EUR 4.7 million. And basically we can give you -- tell you some information about the sales situation. But in general, in the first quarter, the new booking order increased a lot compared with last year. And at the moment, we are optimistic for the second quarter because all the order booked in the first quarter generated more revenue in the rest of the year.
EBITDA grow faster, 76% plus compared with last year. And it is important the breakdown of the EBITDA. In this chart, on Page 7, you can see exactly the breakdown of all the company inside our group with -- the average is 40%, but in breakdown the Wiit increased EBITDA margin from 42.9% to 44.5% and Matika increased from 27% to 30.8%. Etaeria, I remember Etaeria is a company we acquired at the beginning of last year in January. This is the first quarter we can compare when it's inside of our group from 19.5% to 25.7%. Adelante is very, very similar, 21% and 19.7%. And myLoc, the German company increased from 43% to 51%. This is the result -- these results reflect the strategy to cross selling the high-value service of Wiit in the customer base of the acquiring company. In this first quarter, we have -- this rather reflect the first signed contract during the -- the last year, we closed the first contract of the [indiscernible] services in the customer base offer, for example, Matika and Etaeria.
And in [indiscernible] EBITDA, you can see improve immediately the profitability of the company because we put on the customer base more value. This is the result. In the June 2021 adjustment, EBITDA is a material is only related of the cost of the professional services for M&A and in general is low. EBIT adjusted was EUR 4.1 million, plus 90% compared last year. In this case, the adjusted, but include the purchase of location related to Etaeria, myLoc and mainly myLoc acquisition. The total allocation was [ EUR 0.38 ] million in the Q1. And the net profit was EUR 3.2 million compared with EUR 1.6 million. In this net profit, we don't include a positive impact of the [ patent box ]. We are -- the renewal with the tax office is ongoing. Our expectation is to close the agreement for the -- by the end of this year in case of positive feedback from the tax office, we can have the same advantage over the last 5 years with a reduced tax rate to 16% to 20%.
But at the moment, in these figures, we don't consider the positive impact of the patent box. Net debt confirm strong cash flow generation. In the first quarter, we -- with the cash flow, we can pay all the CapEx for approximately EUR 3.7 million, and we can finance all the buyback for approximately EUR 1.5 million. The net debt go down to approximately EUR 1.6 million, but we are paying all the CapEx and a buyback. The value in treasury share is approximately EUR 24.5 million considering the market value by end March and it's not included in the cash accounting. So if you consider the value of the treasury share, the real net debt was approximately [ EUR 70 million ].
Okay. We are ready for the Q&A session. With me are [indiscernible] our Sales Director, is connected [indiscernible], and Pasotto, our CFO.
[Operator Instructions] The first question is from Gabriele Berti of Intesa Sanpaolo.
I have a couple of questions. Do you expect this level of profitability to be sustainable also in the full year or it was exceptional. And then if you could provide the evolution of the long-term backlog since the beginning of the year. I remember that you disclosed the value of EUR 100 million at year-end and what was the evolution in this one.
And lastly, also an indication about the organic growth do you expect for the full year. You [ posted ] few -- very strong results in almost 13%, if my calculation are correct, but I remember that your indication guidance in the previous call was about 7%, 8% for high single digit. Do you expect will improve your guidance following the first Q or do you expect -- you still expect this is the best level of organic growth for the full year.
Okay. Starting for the first question about the profitability. At EBITDA level, we can confirm that is sustainable. At the EBITDA level, you have to consider that we have more CapEx in the last half of the year. And the new CapEx decreased a little bit the EBIT margin. So our expectation is to confirm at the EBITDA level, the profitability, but our [ sums ] to reduce a little bit the EBIT margin because starting more and more [ targets ] on the CapEx. We confirm or CapEx for the year, roughly EUR 60 million. And in our accounting system, when we started the CapEx, we amortizing for the full year -- amortizing the CapEx. So we increased amortizing and we reduced a little bit the EBIT margin. About the recovery or answer by the backlog I would disclose it backlog only -- 1st January of the year.
So as you remember, we disclosed roughly EUR 100 million backlog at the beginning of the year. I confirm what already said shared by Alessandro that the first quarter has been quite a good quarter in terms of results for all the companies within the group. And of course, Germany confirms the very good performance of the market. That would mean, of course, an increasing of the backlog. But at this stage, we don't disclose the number all over the year. In terms of growth rate -- in terms...
[ Excellent ] result has been achieved [indiscernible] Wiit in terms of bookings in the first quarter. In the second quarter, we are optimistic depend a lot on the second half. At the moment, we can confirm organic growth in the range of high single digits from 8% to 10%, depending on the second half of the year. At the moment, we have a good visibility on the second quarter. They also the April has been quite good performance as the first quarter. With the pipeline is good, it's increasing. So we are optimistic, but we still keep the growth rate and the range in the upper single digit.
Next question.
At the moment -- sorry, at the moment, we can confirm the market expectation for the full year results. This is our overview in terms of revenue, in terms of EBITDA, in terms of EBIT. At the moment, we confirm the market expectation. And of course, if in the second quarter and first quarter continuing strongly the booking [indiscernible], we can increase at the moment, we stay on the market expectation figures.
Next question is from Giorgio Tavolini with Intermonte.
I would like you to spend a few comments on the organic growth for myLoc. I think that your M&A focus is still on the consolidation of the presence in Germany. Do you have any update on the M&A pipeline? Secondly, on the CapEx, I understand that there are EUR 3.7 million CapEx in this quarter. They are partially accounted under -- in the cash flow since I understand there is a sort of a mismatch since they are referred to right of use for the purchase -- or for the rental of some electronic equipment. Could you confirm what is the rationale behind? I mean, are you investing in new infrastructure? Or are you renting the infrastructure? And the third is on basically your latest initiatives, the split -- the stock split, if you see specific, I don't know, benefits from these initiatives and from your recent commercial campaign -- so myLoc organic growth, the CapEx and the recent initiatives.
For the first question about the organic growth of myLoc to be honest, we are [indiscernible] for the first quarter for the results is a little higher than our expectation, yes, because we compare the results of the first quarter with the last quarter of the last year, and that was much, much stronger beginning of the second quarter continues in line with the growth. So it has been completely organic and driven with in a very good path with the new logo that...
Yes. Roughly the half of the new booking incoming logo and the [indiscernible].
This confirms also the commitment that we have in expanding our presence in Germany. So -- we confirm that the M&A is at this stage, mainly focused in looking for new opportunities in the general market. If you want Francesco can share a couple of words on the that.
Okay. The second question about the infrastructure in our balance sheet is IFRS for us the same or use the rent or the leasing or you buy direct the asset is all in our balance sheet. It's no different. I don't know what do you see the mismatch.
I mean, it was just for the accounting because I saw the EUR 3.7 million CapEx in the quarter. And then in the free cash flow statement, roughly EUR 1.2 million, EUR 1.3 million. So the difference is, I guess, the IFRS 16. And you say in a footnote that is related to -- if I remember correctly to the right of use of EBIT, electronic something equipment. It was just to understand if I was correctly taking the right numbers. So 3.7% is the real CapEx because in the end, you are investing the 3.7%.
Yes, it's correct. As you told, we classified the purchase in the IFRS 16. So about the right of use -- for this cash flow statement shows only the cash out in the period. But in the second line, you can see the debt -- the major debt for the lenders.
Okay. This question about the split. I think it's running in the next week or the next 2 weeks. Our reason is -- from our perspective, you can increase the liquidity of the stock. And the main reason for the stock [indiscernible] and I think the next week or 2 weeks to implement within the end of the month. Okay.
And Alessandro, sorry, if I may interrupt you. Do you have any thoughts regarding the recovery fund, the implementation since -- in the next few weeks, we -- all the Italians that we will be talking about the implementation of the recovery fund. So do you see a direct exposure, indirect exposure? What are your latest thoughts on this?
Yes. From our perspective, recovery fund can push up in general, the increase of the digital transformation.
We're discussing also at the Board level this morning, the impact of the new projects with the recovery fund. And in general, the new project that long into the digital transformation and the ESG in general. So the expectation of the market also for companies that are a strong view on ESG is positive. So from an investor perspective, full commitment of Wiit in this direction is important. We expect and we see that the clients are looking more and more on the way to make the processes more digital and more efficient. And in that sense, cloud in general, the hybrid and multi-cloud will be a part of the solution, the foundation for delivering that kind of efficiency.
But in general, M&A remain a mandatory with particularly as the result of the first quarter of our myLoc company, very, very well result that we want to increase our market share in Germany. And Francesco can give you more color about our strategy, what we are doing in general in M&A and Francesco can you -- can you...
Sure, it's a pleasure. Just a few words from my side. We are currently working on several potential targets, each of which fits with at least one of the dimensions of our search. Obviously, I mean referring to Germany that is nowadays our focus and as far as the M&A is concerned, but just to explain better, we are working on some targets that could help us to expand in other parts of Germany in order to improve our commercial position inside the nation. And we are also working on some targets that could boost up our journey towards value services in Germany. In other words, we have some [ SAP ] provider in our pipeline that could shorten our search for -- of scales of human resources -- and as I was saying to [ boost up ] the construction of the, let's say, optimal team in Germany.
Obviously, we are always searching for opportunities that increase our revenues and more than that, our profitability, especially if this came from cost synergies. I'm trying to say that we are still focused on avoiding a turnaround situation or [ pressure ] situations. We are, as always, searching for companies that are growing in that space and do not need special attention, let's say, so for their problems. Let me also add that Italy is not completely out of our search. Our focus. Germany for sure is our main focus, as I was saying before, but we are -- we also have some potential targets in Italy. And these 2 of these -- 2 of these processes are very currently active are very advanced. And it's more tactical. It's on targets that have specific, let's say, reasons, but we are not forgetting Italy also on the M&A.
Just to sum up and to recap, as I always remind myself, it's never done until you sign a contract. But frankly speaking, we are very positive, and we are very happy about the results that we are gaining, we are reaching. And we think that we should be able to acquire at least a company before the end of the year. And so stay tuned. Stay tuned. Alessandro, do you want me to add something more? Or do you think it's enough for the M&A?
Our target is to acquire an additional target by the end of this year. This is our target. We don't know possibly more about that, we hope one we can acquire.
The next question is from Kelly Bal Delli of Exane Paribas.
Just a [ clarification ] on your statement that you made before on the EBITDA margin because the level of 40% reached in Q1. Am I wrong in having understood that you think that this is sustainable for the whole year of 2021. And this is the first question. The second question relates to the PPA because on the slides and press release, I saw 2 different numbers. So from the press release it's 0.5%, the adjustment from PPA. While on the slides, there are EUR 380,000. So I was wondering how -- or what is the total PPA for the quarter related to all the acquisitions done, of course.
Okay. About the first question, I think our perspective is we can assume that 40% is achievable, which will be achievable. We target at EBITDA level, yes, because the first quarter was strong and our assumption is with the booking -- new booking for the first quarter confirm the same in the second quarter. And at the moment, we can confirm the EBITDA level results. So before, it's the difference on the EBIT level because we forecast EUR 16 million of CapEx for full year and sure in the last part of the year, we have sure more amortizing for the CapEx. About the PPA, I just give you an answer about the PPA, the...
I think consider that the value that we put in the presentation was related to the value of the PPA included in EBIT values related to myLoc, Etaeria and Aedera. In the press release, we were considering the value in terms of the adjustment exactly.
Yes. The PPA also with Adelante and Matika of the previous year. This component is compared to have the same figures of last year.
To be comparable with [indiscernible].
Okay. So basically, just to sum up, can I assume that the whole PPA inside the D&A is EUR 0.5 million in this quarter.
Exactly.
Exactly.
Okay. Okay. Now, it's clear.
This is in line with the number that we gave of around EUR 2 million for the year.
[indiscernible].
But EUR 2 million for the year because in 2020 was around EUR 2 million already. If I'm not wrong.
EUR 2 million.
EUR 2 million for 2021.
[indiscernible] was the same.
It is in line with 2020.
And how -- and don't you allocate anything for myLoc into PPA, yes.
Because we start to have the PPA of myLoc, Etaeria and Aedera, just on the second part of the year 2020. In particular, myLoc just for only the fourth quarter. In this case, we show that EUR 0.5 million is the total of the quarter not EUR 380,000 regarding only.
Is the full year myLoc -- fully myLoc because there...
Full year of myLoc, Etaeria and Aedera only the quarter and okay. Because last year, in the first quarter, we didn't have the myLoc and the other acquisition of the -- you start to have the preparation in the second half because we have 6 months to adjust the price and the PPA was made in the second part of the year.
Is it clear?
Yes, even if given the acquisition of myLoc, I would have assumed that the PPA in 2021 will be higher than in 2020, given that you have 9 months of additional PPA from myLoc. But probably, I'm not missing something.
Mr. Cozzi, there are no more questions registered at this time.
Okay. Thanks all for joining the conference, and see you soon on the next presentation [ as soon as ] possible. Thanks, everybody.