€387m market cap
€46.35 last close
DATAGROUP is a full IT outsourcing provider, focused on the German Mittelstand market. The company offers the full range of IT services on a modular basis, through its CORBOX “cloud-enabling platform”. Services include service desk, end-user services, data centre services, application management and SAP services.
DATAGROUP recorded a strong H1, with revenue growth of 7.2% (pre IFRS 15 and 16 for comparison purposes), the bulk of which was organic, while the EBITDA margin expanded by 30bp to 12.0%. Adoption of the new accounting standards has made significant changes to the P&L. Notably, the company says that numerous large-scale orders have led to a positive order situation, particularly in the financial services sector – the order book stands at more than €200m in financial services alone. The group announced its 22nd post-IPO acquisition after the period end, which boosts its relatively weak position in the Rhine-Main region and adds competencies in containerised software solutions. While the shares have jumped by c 55% from their late December lows, the c 20x rating looks fair value given the bulging order book and attractive growth opportunities.