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SYZYGY GROUP improves profitability during subdued start to 2024 financial year

Published
SYZYGY GROUP, April 23, 2024
  • Sales of EUR 18 million (-6 per cent on prior-year quarter) or EUR -1.2 million year-on-year
  • Fall in operating income to EUR 1.6 million (-5 per cent on prior-year quarter), with an operating EBIT margin of around 9 per cent
  • Core German market: Sales of EUR 14.4 million (-4 per cent on prior-year quarter) and an EBIT margin of 11 per cent
  • UK and US segment: Sales of EUR 1.2 million (-46 per cent on prior-year quarter) and an EBIT margin of 0 per cent
  • Poland segment: Sales of EUR 2.0 million (+43 per cent on prior-year quarter) and an EBIT margin of 19 per cent
  • Virtual Annual General Meeting on July 9, 2024
  • Suspension of dividend for 2023 financial year to boost equity and liquidity
  • Outlook for 2024: Sales at the prior-year level with an EBIT margin of around 10 per cent

As expected, the SYZYGY GROUP started the new 2024 financial year with sales revenue of EUR 18 million (-6 per cent compared with the same period of the previous year). Operating income fell by 5 per cent compared with the first quarter of the previous year to EUR 1.6 million, while the operating EBIT margin was up slightly at 9.2 per cent (previous year: 9.1 per cent).

The core German market saw a decline in sales, which fell by 4 per cent to EUR 14.4 million, with operating profitability coming in at 11 per cent. This core market thus accounts for approximately 82 per cent of sales.

Sales in the UK & US segment declined by 46 per cent to EUR 1.2 million (EBIT margin: 0 per cent). The Poland segment posted a significant increase in sales, which rose 43 per cent to EUR 2.0 million, with an EBIT margin of 19 per cent.

Financial income was negative at EUR -0.2 million, meaning that total net income in the first quarter after taxes is around EUR 1.0 million. Earnings per share are EUR 0.07.

As expected, the SYZYGY GROUP continued to face a challenging market environment at the start of 2024. Slightly improved profitability was nonetheless achieved. We are well positioned to meet the current challenges. Accordingly, we still expect the SYZYGY GROUP to generate a significant increase in profitability to around 10 per cent in 2024, with sales at the previous year’s level,

Erwin Greiner, CFO

This year’s Annual General Meeting will be held on July 9, 2024 as a virtual event without the physical presence of shareholders. Due to negative total net income and in order to strengthen the SYZYGY GROUP’s capital base and liquidity reserves, the Management Board and Supervisory Board have decided to recommend suspending the dividend payment for the 2023 financial year at the Annual General Meeting as a one-off measure. This decision underlines the Group’s commitment to creating a solid financial basis for sustainable growth.

Outlook

The SYZYGY GROUP is confirming its forecast for the year and expects sales at the previous year’s level in the 2024 financial year, combined with an EBIT margin of around 10 per cent before goodwill write-downs.

Q1-2024
Q1-2023
Change
Revenue
17,557
18,748
-6%
Operating income
1,621
1,714
-5%
EBIT margin
9.2%
9.1%
+0.1pp
Financial income
-168
-668
75%
Net income before tax
1,453
1,046
39%
Net income
1,037
778
33%
Earnings per share (EUR)
0.07
0.06
17%
* kEUR

The full quarterly report as at March 31, 2024 will be available from April 24, 2024 at investors.

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Investor Relations & New Business Susan Wallenborn
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