Report
Katherine Thompson

TXT e-solutions - Putting cash to work

Strong organic revenue growth in Q318 combined with the recent Cheleo acquisition resulted in revenue growth of 18.6% y-o-y, a normalised EBITDA margin of 10.0% (+80bp y-o-y) and a normalised EBIT margin of 5.8% (down 240bp due to higher depreciation from the capitalisation of leases). The company has started deploying the proceeds of the TXT Retail disposal, with the first two deals adding software solutions to the services-led Banking and Finance business. We expect the company to make further accretive acquisitions across both businesses.
Underlying
Txt
Txt

TXT e-solutions SpA is an Italy-based company engaged in the information and communication technologies (ICT) market. It provides software and services-based solutions to enterprises. The Company structures its business into two main segments: TXT Perform and TXT Next. In the TXT Perform segment, it designs and develops software and IT solutions for fashion and luxury, specialty retail, consumer packaged goods (CPG) and discrete manufacturing sector. Through the TXT Next segment, the Company offers system integration and IT services to such sector as aerospace and defense, high-tech manufacturing, and banking and finance. It operates through subsidiaries: TXT e-solutions Ltd, the United Kingdom; TXT e-solutions GmbH, Germany; TXT e-solutions SL, Spain; TXT e-solutions Sarl, France; Maple Lake Ltd, Canada and Maple Lake Australia Pty Ltd, Australia amd PACE Aerospace Engineering and Information Technology GmbH.

Provider
Edison Investment Research
Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts
Katherine Thompson

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