The strategy period was likely 23-25, and in the first year, an improvement of 23% was measured. Could the absolute baseline really be so poor that it hasn’t been provided?
By the way, was it Digia that recently recommended that the drafting of reports on such “softer values” could be delegated to artificial intelligence? Well, be that as it may, my own guess for last year’s improvement is 24%..
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Digia will publish its Q4 next Tuesday at 3:00 PM, and here are Joni’s pre-earnings thoughts. 
We estimate Digia’s revenue to have grown slightly and profitability to have been at the comparison period’s level in Q4. IT service companies that have already reported in the Nordics generally expect the market situation to remain unchanged in 2025. We estimate Digia to guide, in its traditional manner, for revenue and EBITA to grow from the comparison period in 2025. Additionally, we predict the company’s board will propose a small increase in the dividend.
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Hello forum members! Greetings from Digia IR! Here’s a reminder of our upcoming earnings release schedule.
Digia will publish its Q4 2024 review and financial statements next Tuesday, February 25, at 3:00 PM.
Our CEO Timo Levoranta will present the review in a webcast starting at 6:00 PM.
You can follow the live broadcast here: Tilinpäätöstiedote 2024
Please note that you can submit questions during the webcast, which will be addressed after the presentation
Digia’s annual report will be published on the company’s website on March 6, 2025.
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Digia Plc
Investor News
February 21, 2025, at 1:00 p.m.Digia Plc will publish its 2024 financial statement release on Tuesday, February 25, 2025, at 3:00 p.m. The report will be available after publication at: Uutiset | Pörssitiedotteet.
The mentioned page gives an error message. The correct page can be found on the website here: Uutiset | Pörssitiedotteet
The actual question for Digia: is there a compelling reason why the company usually publishes its results in the middle of the trading day?
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Record year, fourth-quarter revenue grew organically by 3% and EBITA increased by 15%
October-December 2024
- Revenue EUR 54.5 (53.2) million, growth 2.6%
- EBITA EUR 5.8 (5.1) million, growth 15.2%; EBITA margin 10.7 (9.6)% of revenue
- Operating profit (EBIT) EUR 5.2 (4.3) million, growth 20.1%; operating profit margin 9.5 (8.1)% of revenue
- Earnings per share EUR 0.15 (0.12)
January-December 2024
- Revenue EUR 205.7 (192.1) million, growth 7.1%
- EBITA EUR 21.2 (16.7) million, growth 26.5%; EBITA margin 10.3 (8.7)% of revenue
- Operating profit (EBIT) EUR 18.2 (13.8) million, growth 31.6%; operating profit margin 8.9 (7.2)% of revenue
- Earnings per share EUR 0.50 (0.37)
- Cash flow from operations EUR 25.0 (17.0) million, growth 47.6%
- Return on invested capital 16.6 (12.9)%
- Equity ratio 52.9 (46.7)%. Net interest-bearing debt EUR 11.6 (24.8) million, decrease 53.0%
- The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.18 (0.17) per share be distributed for the financial year 2024
Outlook for 2025
Digia’s outlook for 2025: Digia’s revenue will grow (EUR 205.7 million in 2024) and EBITA (EUR 21.2 million in 2024) will grow or remain at the same level compared to 2024.
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The market is still pondering the result, as immediately afterwards it began to fluctuate slightly below or above seven euros. A lightly traded stock, so its direction is not yet entirely clear.
Digia’s earnings guidance for 2025: Digia’s revenue (EUR 205.7 million in 2024) grows and EBITA operating profit (EUR 21.2 million in 2024) grows or is at the same level compared to 2024.
It was hoped that the EBITA operating profit would have definitely grown compared to last year. In the current situation, there is nothing to complain about.
However, the future should be bright, as there are now many AI investments and Digia has references in its customer base. Microsoft dependence can be either a good or a bad factor in these times.
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Growth mode is definitely on there. Soon net debt-free, and the dividend was only raised a tiny bit.
Last year’s cash flow after lease liabilities was about 22 million euros. Investments were around five million, so there’s definitely been extra left aside, considering the company’s market value of just under 200 million.
I wonder if there’s something to acquire there?
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Couldn’t Digia acquire Siili, since it would be cheap? It would only require convincing two of Siili’s larger owners (Lamy, Erina). The same large institutional owners are already present in both. With more competent management, Siili’s consultants would surely generate better margins, and business operations that don’t fit the repertoire could be sold off.
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The CEO in today’s report:
”The customer recommendation index NPS has risen by 18 percent and the employee recommendation index eNPS by 60 percent compared to the strategy period’s reference year 2022.”
Read from that, NPS has dropped from the first year’s +23% improvement to the +18% level.
New partnerships and customer relationships have been announced somewhat during the year, so if there are no major setbacks, growth is expected to continue.
Projected at a steady pace, the 2025 EPS could be in the order of about 0.59 … 0.63 €/share.
This is not expensive.
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”..One of our goals is to increase the share of our international business to 15 percent of Digia’s total revenue by the end of 2025. In 2024, the share of international business in our revenue was 11.8 percent.”
It might be that acquisition targets could be found abroad as well.
As an owner, one must be truly satisfied with the company. A great performance in a difficult environment, and that cash flow always brings a smile to my face.
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Indeed, the company has quite a bit of “traction” abroad also through international client accounts.
Here, for example, is the Revenio case, which, in my opinion, hasn’t received much attention.
A somewhat similar case of comparable size is Marimekko.
Etra has been a long-term and slightly larger case in terms of turnover, already in the half-billion class. It has internationalized mainly to Sweden and the Baltics, if I recall correctly. Among the very newest, Broman (Motonetti) and Are are quite similar to Etra, and they have also expanded/are expanding to Sweden, among other places.
But what about Digia itself? How does it succeed in expanding abroad? Climber is probably quite a special case, but what about, for example, Top of Minds? Does Digia have enough effort to boost this into a growing “Swedish Digia” by leveraging all synergies between countries and projects? Because, as is well known, carried water does not stay in the well.
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Hey forum members!
Come join the upcoming Webcast starting soon at 6 PM: Tilinpäätöstiedote 2024
During the broadcast, you can also send your own questions to Timo Levoranta.
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Of course, there can be many opinions on these matters. From my own frog’s perspective, I would think something like this.
- The company’s valuation is low relative to its performance. Even nationally, let alone internationally.
- Quite a few domestic competitors are in a bit of a weak state. This, of course, intensifies price competition, but on the other hand, it certainly helps to stand out in “quality points”. Acquisitions in the domestic market are probably not the optimal way to leverage one’s own strength. Exceptions might be small and neat targeted acquisitions like Avalon.
- Acquisitions abroad, on the other hand, are particularly difficult for Finnish companies. On the other hand, there are a couple from Sweden below, which probably still require work, as the CEO also stated.
So, on my wish list is a stronger investment in Sweden through these acquired positions, and then, on the other hand, the acquisition of own shares.
When 20 million in cash is generated annually, net debt is now 10 million, and market value is just under 200 million, if 5M is put into dividends, could nearly the same amount be put into buying back own shares?
Because even though the CEO constantly talks about how the company does not “live in a quarterly economy,” it is still a publicly listed company. And in my opinion, a somewhat undervalued one at that.
Have they ever bought back their shares for cancellation during their history, by the way?
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Joni and CEO Timo Levoranta chatted about Digia’s wild ride and vibe.
Topics:
00:00 Introduction
00:08 Strong finish to the year
00:46 Market segment development and outlook
02:22 Opportunities and threats for 2025
03:40 Cash for acquisitions
04:30 Guidance
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As long as Ingman remains the largest shareholder, I sleep well at night (and even beyond that). In a very gloomy economy, the company is able to maintain good profitability and grow, so I am at peace 
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Here’s Sijoittaja.fi’s article about Digia.
Digia concluded its record-breaking year with better-than-expected quarterly results. The company’s revenue grew organically, which is a good achievement given the soft market situation. In the earnings release event for analysts, Digia’s management stated that cautious demand, delays in decision-making, and project initiations weighed on the last quarter’s revenue. For these reasons, growth fell short of the company’s own targets. However, in terms of profitability, the quarter’s performance was in line with Digia’s goals.
Although the fourth quarter’s results were strong and exceeded analysts’ forecasts, the market reaction to the financial statement release was slightly negative. Over the past year, Digia’s share price has risen strongly, and Digia has been clearly the best-performing IT sector stock on the Helsinki Stock Exchange.
NOTE
IR-ikkuna (IR Window) is SalkunRakentaja’s and Sijoittaja.fi’s corporate partners’ channel for background and analytical articles, as well as other interesting investor information. The article is part of a commercial collaboration with the company. The article does not contain investment recommendations.
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And first thing in the morning, an eight million contract with the defense forces 
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Tavoitehinta 7,80 EUR / Add
We raise the target price of the share to 7.8 euros (previously 7.3) reflecting forecast changes and lower the recommendation to ‘add’ (previously ‘buy’) due to the share price increase. Digia’s revenue grew organically slightly better than expected, and the result exceeded our forecasts in Q4. In addition, the guidance and dividend proposal were relatively well in line with our expectations. We expect Digia to continue moderate organic growth in the coming years and accelerate it through acquisitions. We estimate profitability to remain stable now and gradually increase from next year onwards. The overall valuation of the share is attractive (return expectation <15% and 2024e P/E 11x), especially considering the good confidence in earnings growth, low risk profile, and a significant portion of recurring business.
Key Figures 25.02.
2024 25e 26e
| 2024 | 25e | 26e | |
|---|---|---|---|
| Revenue | 205,7 | 211,5 | 218,5 |
| growth-% | 7,10 % | 2,83 % | 3,32 % |
| EBIT (adj.) | 21,5 | 22,0 | 24,1 |
| EBIT-% (adj.) | 10,47 % | 10,42 % | 11,03 % |
| EPS (adj.) | 0,60 | 0,63 | 0,71 |
| Dividend | 0,18 | 0,19 | 0,21 |
| Dividend % | 2,70 % | 2,73 % | 3,02 % |
| P/E (adj.) | 11,14 | 11,09 | 9,84 |
| EV/EBITDA | 7,49 | 7,08 | 6,16 |
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Would a share buyback correct the multiples - perhaps to these? What other methods could there be?
24EUR Target price / Add
Key Figures 20.02.
2024 25e 26e
| 2024 | 25e | 26e | |
|---|---|---|---|
| Revenue | 186,2 | 190,2 | 208,1 |
| Growth-% | −1,62 % | 2,16 % | 9,42 % |
| EBIT (adj.) | 23,9 | 25,3 | 28,9 |
| EBIT-% (adj.) | 12,85 % | 13,30 % | 13,90 % |
| EPS (adj.) | 1,27 | 1,33 | 1,50 |
| Dividend | 0,48 | 0,50 | 0,53 |
| Dividend % | 2,16 % | 2,31 % | 2,45 % |
| P/E (adj.) | 17,46 | 16,25 | 14,46 |
| EV/EBITDA | 11,01 | 9,95 | 8,30 |
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not a day without a deal 
The company certainly seems to have a good buzz.
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