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PERFORMANCE TECHNOLOGIES | Full Performance Mode: From Projects to Predictable Growth

Leading systems integrator with top-tier partnerships and strong local positioning – Performance Technologies is a leading systems integrator and IT services provider, designing and implementing digital transformation solutions across cloud, observability, ITSM/ESM, analytics, automation, cybersecurity and AI. The group delivers the full lifecycle of deployments (planning, customization, implementation, maintenance and managed SaaS/services) leveraging long-standing partnerships with top-tier technology partners. Performance serves a diversified base of large and mid-sized corporates across sectors including banking, telecoms, energy, manufacturing and retail.

Well placed within Greece’s enterprise modernization cycle – The Greek IT landscape remains structurally supportive, as enterprises step up IT spending to modernize legacy systems and meet rising digital requirements. Investment in IT infrastructure is becoming continuous rather than cyclical and is now viewed as mission-critical as companies look for operating efficiency and resilience, while increasingly relying on cloud tech. Demand is strongest among large corporates, where integration complexity and limited provider capacity have created a sizeable pipeline. We believe PERF is well placed, given its blue-chip client exposure and expanding managed services footprint.

c19% adj. EBITDA CAGR and rising margins through 2029e; mix shift toward higher-value services – We pencil c17% revenue CAGR over 2025-29e anchored by IT Services, which we expect to grow at c15% CAGR through 2029e, on the back of deeper penetration of existing multi-year service agreements, onboarding of new clients and recurring upgrade cycles across addressable markets. We see the revenue mix shifting gradually toward higher-value services as clients migrate to cloud-native architectures. Taking the above into account, we envisage c19% adj. EBITDA CAGR through 2029e, with margins accelerating to c13.7% on better mix, higher utilization of technical teams, operating leverage from standardized delivery and improved vendor terms with scale.

Healthy cash generation, clean balance sheet and rising return capacity – Performance has strengthened its operating cash flow materially in the past 2 years and we expect working capital to normalize toward c17% of sales as the model shifts towards higher-margin activities. Intangibles remain modest, as internally developed frameworks are expensed rather than capitalized, while annual capex is limited at €1.5-2mn given the asset-light nature of the model. PERF’s solid net cash position (€10.5mn in 2024) coupled with our forecast for annual FCF >€6mn from 2026 on, creates meaningful deployment optionality for scaling, selective M&A and gradual evolution of shareholder returns. On the latter, we assume c35% payout for 2025-28e (vs. c20% in 2021-24).

Valuation: growth leadership at a discounted multiple – PERF currently trades at c7.1x 2026e EV/EBITDA, at 20-25% discount to EU system integrator/VAR peers and notably below its Greek cohort, which, in our view, looks misaligned, given PERF’s c19% 2025-29e adj. EBITDA CAGR and increasing mix of recurring, higher-value services. We base our valuation on Performance Technologies on a DCF (WACC at 9.3%), yielding a baseline value of €10.2 per share, valuing the stock at c9.5x 2026e EV/EBITDA, at premium vs. EU system integrators (justified by the superior growth) but at discount vs. the broad EU IT sector. Flexing our WACC and perpetuity growth inputs by 1% and 0.5% respectively yields a fair value range between €8.9 and €12.0 per share.