Expanding Cancom group's sales grew 18.7% to €1.379bn in 2018, with adjusted EBITDA improving by 24% to €114.8m. There was also strongly increasing annual recurring revenue and a significantly increased contribution to earnings from the Cloud Solutions segment of the business.
The global VAR headquartered in Munich acquired two UK companies last year which bumped up sales, but it stressed that without these buys organic sales growth was still up 12.1%. Cancom won Enterprise (Cloud) Solution of the Year in the European IT and Software Excellence Awards on March 14.
The overall adjusted group EBITDA margin increased marginally from 8% in 2017 to 8.3% last year. "Our growth rate is well above the general market trend and this shows our strong competitive position. The fact that we can further increase operating profitability despite this high growth strengthens our conviction that we are pursuing the right strategy,” said Thomas Volk, CEO of Cancom.
The figures for the fourth quarter of 2018 were €415.2m for group sales (previous year: €352.3m) and €36.6m for adjusted EBITDA (€32.4m last time).
Annual recurring revenue rose by 41.3% year-on-year to €130.1m compared to €92.1m in 2017. For the year, Cancom achieved a higher contribution to earnings in the Cloud Solutions segment than in the IT Solutions business for the first time.
Cloud Solutions contributed revenue growth of 33% to €242.5m compared to €182.3m. EBITDA amounted to €64.1m – up 40.6%. The IT Solutions segment achieved a sales increase of 16.1% to €1.136bn, with EBITDA at €62m, which was up 10.1%. The company expects the growth rate in Cloud Solutions in 2019 to again outstrip growth in IT Solutions, and that overall annual recurring revenue will see a “very significant increase” for the year.
