Proact reports full-year revenue slowdown as CEO Hasselberg prepares to exit
The Sweden-HQ solution provider continues its transition to services, but systems business drags down top line
Swedish IT solutions provider Proact IT posted a modest revenue increase in its full-year results from 2024, but a weaker fourth quarter led to a profit warning as CEO Jonas Hasselberg prepares to exit the company.
For the full year, Proact reported revenues of SEK4.9bn (£359.9m), up 0.3 per cent from SEK4.9bn in 2023.
Adjusted EBITA surged 16.1 per cent to SEK 350.6m, reflecting an improved EBITA margin of 7.2 per cent (up from 6.2 per cent year-on-year).
Earnings before tax also climbed 27.3 per cent to SEK278m, while net earnings jumped 27 per cent to SEK 219.9m.
Services lead the push for recurring revenue
The company saw strong momentum in its cloud services business, with new contracts worth SEK 643.1m signed during the year, a 17.4 per cent increase compared to 2023.
Recurring revenues from cloud and support services also rose 3.7 per cent to SEK1.8bn.
As of Q4, services now account for 45.5 per cent of Proact’s total revenue, underscoring the company’s ongoing shift toward recurring revenue streams.
Q4 slowdown and profit warning
Despite these gains, Proact was one of many solution providers to face a challenging Q4 2024, with revenues declining 6.7 per cent year-on-year to SEK1.3bn and adjusted EBITA dropping 12 per cent to SEK80.2m.
Earnings before tax fell to SEK63.7m from SEK 82.6m in Q4 2023.
The decline was primarily attributed to a temporary dip in Proact’s systems business and ongoing market challenges in Germany, leading the company to issue a profit warning in December.
At the time, Proact projected Q4 revenues would shrink by ten to 15 per cent.
However, one bright spot was its strong cloud business, with Proact securing SEK224.3m in new cloud agreements during the quarter—a 13.9 per cent increase from Q4 2023.
CEO Hasselberg out as search for successor continues
As previously announced, CEO Jonas Hasselberg will step down after nearly seven years at the helm.
The board has begun the search for his successor, with Hasselberg remaining in his position until 16 June 2025 or until a replacement is found.
During his tenure, the CEO has overseen a 70 per cent increase in profits and a near tripling of cloud revenues, including acquisitions such as Manchester-based Cetus Solutions in 2020.
“Although the macroeconomic situation remains uncertain, we generally see increased demand in most of our markets, driven mainly by our customers’ continued need to digitalise their businesses, strengthen cybersecurity and increase the use of artificial intelligence,” Hasselberg said in a statement in October.