B3 Consulting Group (B3) Q3 2024 earnings summary

Executive summary

• Revenue grew 9.9% year-over-year to 245.4 MSEK in Q3 2024, driven by acquisitions of Webstep and B3 Consulting Poland, despite a challenging market.

• Profit after tax surged to 74.5 MSEK, mainly due to a 77.8 MSEK non-cash revaluation gain from the B3 Poland acquisition; adjusted profit after tax was -3.3 MSEK.

• Operating profit (EBIT) for Q3 was 1.0 MSEK (0.4% margin), impacted by non-recurring items; adjusted EBIT margin was 2.2%.

• Operational improvements and cost-saving programs, including "Hedgehog," delivered 41 MSEK in annual savings and are expected to further strengthen results.

• Several significant deals were secured, and growth is expected to accelerate.

Financial highlights

• Q3 2024 sales: 245.4 MSEK (up 9.9% YoY); Jan–Sep 2024 sales: 793.1 MSEK (down 6.4% YoY).

• EBITDA was 10.6 MSEK (4.3% margin), down from 15.5 MSEK (6.9%) year-over-year.

• EBIT dropped to 1.0 MSEK (0.4% margin) from 10.0 MSEK (4.5%) year-over-year.

• Earnings per share after dilution rose to 8.65 SEK, driven by the revaluation effect; adjusted EPS was -0.43 SEK.

• Cash flow from operating activities was -47.1 MSEK in Q3, compared to -41.2 MSEK in Q3 2023.

Outlook and guidance

• Stronger growth and increased profitability are expected in Q4, with operational improvements progressing rapidly.

• No formal forecasts provided; focus remains on growth through recruitment, start-ups, and acquisitions.

• Financial targets: 1.5 billion SEK in annual sales by end of 2025, 10% EBIT margin over time, and borrowings below 2x EBITDA.

• The Swedish IT market is weak but expected to recover; the Polish market outlook has improved.

• Generative AI presents both opportunities and risks, positioning the company to assist clients as the market evolves.