Promising addition to management / Strong FY24 figures ahead

Combined with his extensive experience in management roles, this makes us confident that Dr. Günther, with his expertise and commitment, will be able to significantly contribute to achieving 123f’s strategic goals and thus creating sustainable shareholder value. Prior to joining 123f, Dr. Günther, after many years at Bain & Company, was Managing Director at the CHECK24 Group and then at JUMiNGO, a tech scale-up.

Strong FY24 ahead. On March 31^st, 123f will release final FY24 figures, which should be in line with the company's prelims from January. To remind you, FY24p sales came in at € 22.8m (+10%), indicating an improved level of registrations in H2 following 6% growth in H1 but also the impact of Foerst GmbH (closed on July 1^st). FY24p EBITDA came in at € 0.4m, implying a € 1.3m improvement and clearly displaying the continuously improving scalability of the business. Moreover, the cash flow from operating activities came in above the preliminary EBITDA.

Strong order intake to start off FY25. During the first months of the year, 123f has received strong demand for simulators, especially truck simulators. Notably, in January alone, the company received new orders worth € 1m, thus already surpassing total FY24 sales in the simulator segment. Based on this, we expect management to increase marketing and sales effort in order to grasp the momentum.

This, coupled with the strong underlying business model and the introduction of new branches, 123f looks set to accelerate growth and notably improve its profitability as reflected in the FY25 guidance of € 28-30m sales (eNuW: € 28.5m) and € 1.5-2.5m EBITDA (eNuW: € 2.5m).

We reiterate BUY with an unchanged € 7.20 PT based on DCF.