Bechtle has warned its Q3 profits will come in below expectations amid continued tepid market conditions in Germany and France.
Mainland Europe’s largest reseller has built a near €300m-revenue UK business in recent years through a string of acquisitions.
But in a stock exchange announcement this morning, Bechtle warned that its SME clients remain reluctant to invest, with its “most important markets in Germany and France the most affected”.
Q3 earnings before tax are set to dip from €93.9m to €78m year on year, the Neckarsulm-based outfit said.
Business volumes are also on course to fall 1% to €1.89bn.
“Surprisingly weak”
Bechtle acknowledged the picture is even bleaker than when it reined in its full-year expectations in July.
“As in Q2, the usually critical end-of-quarter period was once again surprisingly weak. In Q3 2023, Bechtle was also able to secure a large-volume software project, which had a positive impact on revenue and earnings. The same quarter this year did not see such an effect,” it stated.
“In light of earnings development so far this year, coupled with the continuing adverse economic conditions in the third quarter, the Executive Board no longer expects to achieve the adjusted forecast announced on 18 July 2024.”
Looking at some of Europe’s other big listed VARs, Computacenter last month logged a 10% annual dip in its first-half revenues, while software-focused Bytes Technology Group continues to enjoy double-digit growth. All eyes will be on Softcat’s annual results later this week.
Despite the IT market slowdown, Bechtle has stepped up its UK M&A drive this year, acquiring both wireless networking specialist Qolcom and €6.5m-revenue CAD specialist DriveWorks this month.
