Good afternoon, and a warm welcome to our quarterly call today. Good to have you all with us. With me is Andreas Baresel, our CEO. Hello, Andreas.
Hello, good afternoon.
This morning, we already published our quarterly figures, Q2 and H1 2023-2024. Press release and report can be found on our website at datagroup.de. Andreas will now give you a short presentation on the figures and the most recent business update. This will be followed by a Q&A session, the procedure of which we will explain after the presentation. I now hand over to you, Andreas. Please go ahead.
Thank you.
Thank you so much.
Thank you. Yes, also a warm welcome from my side. Welcome to our half-year figures and also, of course, in the new setup of our call. As you might know, we offered a German call this morning already, and I was really happy about the participants. We had more than 50 participants in the German call, and I think we have something like 20 registrations now for the English call. So, happy about the interest in our new figures. As amongst you also might be some who don't know DATAGROUP yet, this much in detail, are not following us for such a long time.
I will start with a short intro on DATAGROUP, on the business model, on our positioning, and then come to the actual business update on this fiscal year, how things are going so far. And then, of course, we will come to our half-year figures, which I already can say are showing quite good already, how we are performing, how our growth model is performing. That's also recognizable in our figures. And as Anke said, we will have a Q&A session later on, and I'm already looking forward to your question. Let's start with DATAGROUP at a glance. We are the leading German IT full-service provider. We are addressing German Mittelstand, German mid-sized companies and organizations with our CORBOX approach.
The CORBOX you see on the right side of the slide, that's this nine service families, and with the CORBOX portfolio, you can more or less run your complete IT as an organization, as a enterprise, let it completely be run by, by DATAGROUP. The idea behind the CORBOX is service as a product. So the CORBOX is a highly standardized service offering, which enables us to produce IT services where is a high efficiency, and with a very good quality for our customers. We are doing this for, or with long-term contract relationships for our customers. A typical contract has 3-5 years duration, and then is most of the times renewed by the customers. So we have a quite stable business model.
When the customer has once decided to give his services to DATAGROUP, he's typically staying for a quite long, long period, and that means we are growing with every customer we are winning in addition. That's the basic idea behind our business model. We are doing this up to now within revenue of approximately EUR 500 million in the last fiscal year and an overall staff of 3,500 employees. So that's the size we have grown up to now. Our plan is quite clear to further grow the company. To do this, we are at the moment investing in the quite important set of technologies named AI, Security, and Cloud. I will explain more about this during my presentation.
And that are the technologies which will bring us more growth in our business in the future. As I said, I will explain this in a few minutes. Our overall growth strategy, we have readjusted it a little bit since the during the last 12-18 months, as we had in the past, a quite strong focus on inorganic growth, made over 30 acquisitions of company in the years since we were public listed, and grown with this strategy to nearly EUR 500 million. We have refocused more on organic growth now. The reason is, especially, we have now the size and the power to really also grow organically, and also on the prices for M&A targets, that things has changed a bit more. It's not this cheaper anymore to buy companies instead of growing organically.
So we have refocused on organic growth and also readjusted the company setup for this new focus on organic growth, and that took some time. It also led to the situations that we had a bit of a sideways development of our total revenue in the last fiscal year. But overall, we are back on a growth track now. You will see this in our figures later on... And for this new setup, we've also made some adjustments in our organization. One adjustment is the adjustment of our board. You see here the new setup, and the idea behind the setup is to have two board members who are really focused on our organic growth part.
We have, on the one hand, Alexandra Mülders as Board member, focused on sales, sales and revenue growth, as a full focus, and she's doing the coordination amongst all DATAGROUP companies addressing the market and ensuring that we reach our growth targets. Beside her, responsible for the delivery then, so for the good onboarding of the customers we've newly won, and then delivering our service, reaching a good customer satisfaction, Mark Schäfer, he's responsible for production, as we call it. There are two roles which I was formerly responsible for, sorry. As we now have two dedicated people in the Board working on these topics, I have some more free space.
And also, we had the situation that Oliver Thome, our former CFO, he had new plans, and so he decided I took over finance, M&A, and investor relations from him, and that are in my responsibility now. And beside myself, Sabine Laukemann, as other official board member, further on responsible for HR, corporate communications, organization, legal, and ESG, also more or less unchanged since our last setup. And with this setup, I'm quite sure that's a very good setup for really reaching also our organic growth strategy, reaching our targets in this area. Let's go on to view how are things going up to now, how far we are with our targets for this fiscal year.
I can say we are very well on the way to achieving our operating goals and targets for the fiscal year 2023-2024. As I already explained, our growth strategy is based quite strong now on organic growth. We have a yearly growth target for something like EUR 30 million, EUR 10-15 million growth from totally new customers, the big red area, and another EUR 10-15 million from cross and upselling new services to existing customers. So if I take the upper range, overall, 2 x 50 million, so 30 millions coming from new business, new customers. Besides this, we have the growth in an inorganic way, in the lowest area with the blue part, and there we have the target to still keep on acquiring companies.
But in the past, the focus was really on growth coming from this area. Now we have a more specific targeting approach, as we really want to acquire companies who are paying on certain strategic goals, like regional market access, for example, or growing certain specific segments of the market, or just increasing or improving our capabilities with certain technologies, for example. And in this area, we also have already three acquisitions. This year, it's CONPLUS. They are an add-on acquisition in our small and medium enterprise segment. We have iT TOTAL as a regional company in southwestern Germany, where we were not this present up to now, and they are located there, and they give us a new regional market access in this area.
We have our youngest, our latest member, ISC, Innovative Systems Consulting. They are a SAP consulting company, more or less, and they. I will explain a bit more what the idea was behind their acquisition. You see, with three companies, we have already more or less fulfilled this target. Maybe one is open until the 4th. We will see if something's coming up again, but already with this number and the size of the companies, we have already fulfilled the calculated growth part for an organic growth in this area. And as you might have seen, with EUR 21 million new customers, we have already overfulfilled our new customer area, and EUR 12 million-EUR 12.7 million in cross and upselling are on a good way for the cross and upselling.
Taking both together, we are already significantly over the EUR 30 million. So I'm sure we will have a kind of a record order entry year this year. The last area is this extension of existing CORBOX customers. Of course, that's also important to always maintain the existing customer base as then additional business will really add on in growth, as long as we are extending the existing customers. There we have up to now 38 contract extension already, so also are on a good way on our target with 20% of our CORBOX customers renewal every year. We have approximately something more than 200, so that's also in a good way. Of course, we are not totally free in this area, as it's determined by the ending of the contract.
Depending when the contract ends, it's renewed. But with 38, we are also in a very good way there already. And if we go a little bit into detail with our organic growth with our new customers, we've brought you here a little insight, what are typical examples of new CORBOX business or extending CORBOX business. And the two big ones we already had in Q1, we reported them already. One customer from the process industry was EUR 5 million on an annual basis, and then heat and electricity production company with another EUR 5 million annual volume. But also in the second quarter, we added some quite interesting new and upselling results. For example, in the food industry, we had a quite good cross-selling success into solution area.
So for this company, we are now developing with our solution segment a digital app for the delivery process for about EUR 1.4 million for the total project volume. And we are also have cross-selling successes. For example, for this banking customers, he decided to let us run his SAP systems for another five years with a yearly volume of EUR 1.6 million. It's also quite good extension in this area. And the last example, the trade fair company we have there. We renewed the overall contract, which is somewhere in between EUR 3 million-EUR 4 million annual volume.
The colleagues from the DATAGROUP in Munich, they managed to get an additional extension to more other services in the cloud and application service area for EUR 1.2 million on an annual basis. So extended it from something EUR 3+ million to over EUR 4, 4.5 million. And that's a very good example how also with existing customers, which are already running for several years with DATAGROUP, they are still good for really nice extensions in the service scope when they are renewing their contracts. So that are examples how our customers they are developing and also how our growth model is developing. And as I've said, we are renewing the existing customers and then adding new customers and new additional services, and that's the idea behind our growth approach.
What you have to keep in mind in this business is that between we are signing a new contract or an extension of a contract, it always takes some time until these contracts or these new contracts will show up in our revenues. What we've shown here is how the last year's new customer and new business acquisitions, how they came and will come into revenue over the next upcoming months. And you see, we have just reached now with the April numbers our new order entries from fiscal year 2021, 2022, and from fiscal year 2022, 2023. There, we reached the highest level.
For the contracts we have won this year, the red ones, we are just on a very small base of revenue existing level, and the big parts, they will still come, and they will reach their highest level even at the start of the next fiscal year. So most of them will be in revenue end of this fiscal year. And as these are April numbers, there was already added some more business in May now. So we are already with another, something like nearly EUR 3 million business, which are already included in the EUR 21 million additional business you saw before.
It's this light red area, which should show this fiscal year hasn't even ended, and I'm quite sure if we continue with this sales successes further on, that we will have quite a record order entry this year, which will ensure already in the next fiscal year, further growth in revenues. As you see, we are already in February and March 2025 until some of these contracts will come into revenue when they are signed now, as sometimes or typically the transitions or onboarding the customers take something always nine months, for example, sometimes even up to twelve months. So keeping this in mind, you also have to look at our figures later on. So what you see there are only the first results of this track we set it here.
To ensure the future and make sure that this good results, we will also be able to continue in the next years. We decided, because the situation on the technology markets was opportunistic for this, we decided to invest this fiscal year more than in the last years in new technologies. That's approximately something around EUR 6 million we are investing in addition to former years in certain technologies. And that's something you also see on our bottom line, that we have effects, not the full EUR 6 million, but a big portion of it, we are seeing as effect on the on the bottom line. We will see this also on the numbers later on, and we'll explain it.
Now I first would like to explain it: why these new technologies, these investments make sense, and what's the growth ratio and the growth potential behind. Let's start with AI. That's the first one. We come to cybersecurity and cloud, because all of them have a quite interesting idea behind. In AI, I know everybody's talking about AI at the moment, but it's quite worth looking behind the scenes of the companies and to ask the question: what are you really doing with AI? Is it just an add-on offering or a small product featuring AI that you're part of the game, or it is really a substantial change in your business AI will bring? For us, it's the second answer.
For us, AI will, and we totally believe in this, absolutely bring a total change in how we produce, IT services. So that's why we invested in a kind of a company. We took over the assets from a former company. Assets means the people, the team, the experts, but also the IP, the technology from an, AI specialized company. The technology is called HIRO, and it's not what's discussed quite intensive at the moment, this big, large language models like ChatGPT, because that's something we could use at the customer front end.
But what we need is more AI models, which are really able to learn knowledge, to learn the knowledge of our experts, of our administrators, and which we can train, that they do the administrator's job in the future, so that they are kind of a tool or a kind of a multiplier on the administrators, on our experts' capacity. And that's what HIRO is doing. It's a knowledge graph and a reasoning model behind two specific names, which are already always discussed behind the idea how to automate knowledge. And HIRO can capture and multiply, as I said, this expert knowledge in our IT service production. And that brings us to the situation that we can scale our service capacity in the future, independent of access to skilled labor and at minimal marginal costs.
That means using AI, when we add a new customer, we need much less additional staff and personnel costs than before, because we can just add this additional workload onto the AI, AI-enabled production. The idea behind is that we address with this an area which was not possible for automation before. The red area you see on this chart, that's the area we are using HIRO, so for tasks which have a higher complexity and a higher individuality, and which were not addressable with classical automation before.
That has a quite big impact, and it gets possibly, because also we can train every single step of work to this model and then individually compile and execute the suitable work steps when HIRO is using its knowledge to automate tasks and to solve tickets, as we are saying. As I said, we started middle of last year with this approach, made a lot of basic work up to now, and we are at the situation that we have effort in training the model now, the knowledge module, setting up the interfaces in the start phase. But in the future, fewer and fewer new skills are required for new tasks, and the platform's capability will grow exponentially.
So the combination of own IP we are training here with this technology and the model creates really a valuable asset, and that's really a DATAGROUP-owned asset. It's running on our own CORBOX cloud. The IP is owned by DATAGROUP. So we are really creating an asset there and not depending on some technology we are just using buying from the market or which is owned by a cloud provider or anything like that. And that's really important to keep on this advantage and be competitive about it in the future, as we are not depending on external capabilities or external license costs or things like that. And that's something we are really doing different than a lot of companies which are talking about AI in these days. So far, what about the AI investment idea?
Then, let's go on. Oh, the screen is back. Let's go on to the cybersecurity area. Cybersecurity is not really new, but we have, at the moment, a situation on the market that the regulations are coming more and more into place. So for certain industries, like the financial sector with the DORA regulation or the infrastructure sector with the NIS2 regulation, companies are forced to run their IT on a certain security level. So you see here on the left side, these seven lines of defense, which are mandatory, for example, following the NIS2 directive, and are technical features you have to fulfill, and when running your IT. A lot of companies say: We can no longer meet these requirements in our own infrastructures.
So IT security is not only a potential for more and more market potential for additional services, it's already, it's also a kind of a driver for IT further IT outsourcing. So if you do IT services for a company, IT security services, you, you see how many vulnerabilities in the landscapes there are, how much potential of renewing these architectures is there, and renewing means making them safe. So then the option for giving these services also to a provider like DATAGROUP is quite big, and that's the reason why we are addressing it so strong at the moment, and also investing in our capabilities in this area, as we see a very good market momentum, as these regulatory requirements are coming up for a large part of the economy at the moment.
And when we follow here some numbers as our business is developing, you see these investments are already having an impact. We have nearly or more than doubled our revenues in the last years already, following after starting this investment. We will probably overcome or reach much more than this EUR 4 million in revenue. I think we will be closer than to EUR 5 million. And if you're looking on the lower right side of the figures, we have a good sales opportunities pipeline with another EUR 20 million in the pipeline, so that will be worth for another step up of the revenues in the next year. Our ambition is really to double it again and come out with something like nearly EUR 10 million in security revenues.
Of course, overall, that's a nice part of growth, doubling the revenues every year here. But also, as I said, it's an enabler or a driver for future outsourcing business in other areas, as security is driving or impacting customers to decide for outsourcing. Let's come to the last part: cloud. Cloud's not really new. It's already in the game since the last 5-10 years. But what we see at the moment is a further diversification of the cloud market. So new customer and future-proof portfolios are coming up as multi-cloud orchestration is more and more requested. And why is this the case? Up to now, cloud was adopted by companies which could easily use these offerings.
But there are certain industries and certain branches where cloud has its limits or had its limits up to now, as also regulations say you can't use public clouds in this or that way. And that's why we added to the right side on the slide, to our enterprise cloud and the hyperscaler platforms, which we are using for our services, we added the left side. So we added own private cloud offerings and also combined it with a STACKIT partnership for sovereign cloud offerings, and that is a new potential. As you see there, we have a finance cloud, a defense cloud, a CORBOX Local. And these specific cloud offerings are enabling customers to use cloud technologies, even they are under regulations.
Like the finance sector has limits because of regulations using cloud technology, or also the, of course, the defense sectors because of also more regulations in this area. And with these specific offerings, they are able to use it, and of course, they are stepping towards providers who offer these things. And what we already see that we are winning or have won part of the contracts we have just shown you before. We have won because of exactly these investments. We, for example, have won one defense customer, because our defense cloud was already there, we set it up before invested in this capacity and said, "You can start directly using this capacity with your idea of your new business." And that was one of the customers with a, I think, EUR 3.5 million annual contract.
So these investments are already bringing a quite good payback. So that's the idea, and I hope you have seen the potential behind our investments we are doing at the moment. As we see first paybacks already now, the majority will come next year and the year after. I'm quite sure we will also have a good leverage to the investment already next year, but the full potential we probably will reach in the follow-up fiscal year. Let's step to the other growth area, our inorganic growth. As I said, it's not this strong focus anymore, but it's still playing a major role in our growth model.
As we say, we still need inorganic growth, especially with companies which have a bigger growth potential under the DATAGROUP roof. There are companies, like I said, which bring with them a certain asset, like in regional market access or an add-on to a certain customer segment, or like in the case of ISC, a certain competence, a certain capability. And ISC did this, and they joined in April, as they are a SAP consulting company. And SAP consulting, up to now, was not part of the really strong areas for DATAGROUP. So we have a lot of SAP customers, more than 200 SAP customers. But we were offering to them more or less business services, IT services, and not addressing those consulting parts as much.
And this capability, ISC is now bringing with them, we are also able to do the number of S/4HANA migrations now, as our customers are requesting, bringing new functions from the latest SAP products to them, innovating with these customers. So really good upselling and cross-selling potential for our existing customer base. And that's why we think, ISC, which has up to now, EUR 12 million in revenues, 50 people, they have a very good growth perspective under DATAGROUP, because now they can address, with their capability, all our, all our customers.
So another acquisition in this area, and as I said, with ISC, iT TOTAL and CONPLUS, we have reached already the idea of our target of integrating growth for this year, and we will focus or follow this more specific acquisition strategy also in the next years. So overall, that means at a glance, we have a sustainable, growth-oriented, new organizational setup, sustainable, stable, and robust business model. We continue our strong order intake and very good progress in all our growth targets. Our investments in key future growth drivers are delivering first results, and the targeted acquisitions bring a high contribution to future growth with them. And so we are quite happy with the first half of the year, how far we've gone up to now.
I think, with the numbers we now we'll see, you can, you can already follow these effects, that they also result in some of the numbers which are improving. So let's start with the actual figures. I show here the Q1 data only, as a first step. And we are, when you're looking on the sales growth, there's a nice, nice growth due to the startup of the new customers I've just explained. And that is following the actual transition period and also some M&A effects, and also some effects which are special, in accordance with IFRS. Because if you look a bit lower, where the growth is coming from, you see it's strongly coming from the trade area.
On a first sight, that might look we have improved our, or we have increased our trade business, but that's not really true. What we've improved, and it's shown in this line, as within the transitions we are doing at the moment, we are bringing new infrastructure, which is to them, which is included in our service for the next years. And that means that, following IFRS rules, this infrastructure value is shown as a trade revenue ... at the moment when you bring it to the customer. So it's not shown as it might be expected during the next 3-5 years as these services are running, because the customer is paying it this per service. So we will be paid for this infrastructure within the next 3-5 years.
But as a revenue, it is shown as a single moment at the beginning when this infrastructure is set in place. And also, it's also something what has to be kept in mind for the next quarters, as there will more infrastructure be brought in place with more customers to be boarded or renewed as they have extended their contract duration. And of course, it's also something what has a certain effect on the operational cash flow, as you have to pay this infrastructure, of course, but the customer is paying us on the long term. And even if we do a sale and lease back, for example, we only see it as a financial cash flow and financing cash flow, and not in the operational area.
But we will see on the cash flow slide later on. Sales growth is showing up, but as kind of transitional effects at the moment. The service and maintenance line, which has only a small growth, it will pick up, I think, in the next quarters, especially Q4. You will see the start of the services of the new customers, like, you might remember this red area to grow within the next months on one of the former charts. When we look on the total H1 numbers for the full half year, we see some more things I've just explained in my business update.
We see an increase in personnel expenses due to the acquisitions, investments in the sales force, and especially in new employees in the future-oriented areas of AI, cloud, and security. So if you look on the personnel expenses, you see an increase of 9.6%, percentage. That's exactly where we see our investment in this area, as most of these investments mean we are hiring experts. They are building the new cloud platform, they are building the security services, our new capabilities there, and they are setting up especially all our AI platform optimization, and bringing it into place and bringing it into work. So that's all personnel costs we have there, and that's why this part has so strongly grown, and that's exactly where we see the investments.
Something else we, of course, see on this half year P&L chart is when you look down on the financial net result, we see a strong increase in the interest rates. It has more than doubled as now also our new financing setup is in place. And of course, following the latter, the former financing setups we also now have to pay higher interest rates on the market. I think we made very good negotiation results there, have competitive interest rates still in place, but of course, like everywhere, they are much higher than in the former ones we've set up several years ago and which ended now after their contract period. If we go...
When we go to the balance sheet for the first half year, you see some more developments we've just described. You see the increase in goodwill, driven by the acquisitions of CONPLUS and iT TOTAL. Due to this acquisition, we also see an increase in the net debt from EUR 112 compared to end of last fiscal year. Now within the middle of the year, we are at EUR 142, and we have just paid our dividend in March. Of course, that will kind of leverage again during the second half of the year, which will bring again a bigger cash flow and which will change the total net debt level again.
With the overall net debt EBITDA ratio, we have reached now 1.87, a multiple of 1.87. That's more than in the past, and our target is to more or less have this number on as kind of a maximum level, not increase it much more, even if there could be some additional potential, discussing when we are discussing with the banks again. But we are more or less want to deleverage here a little bit, using our cash flow in the future to maybe get this number a bit lower again.
Because the idea behind our inorganic growth now is to make it in a size or do acquisitions in a size that we are able to finance it, more or less out of the ongoing cash flow and the cash flow the companies are bringing with them. So we are aiming not to increase this level much more. Last detail slide on the figures, our cash flow slide for H1. We have still a quite solid operating cash flow, but what in this period has to kept in mind, we have or we are at the moment changing our factoring provider, our factoring approach. So we have brought down our factoring volume with the last provider and have not set up it with a new one yet.
So that means we have a higher level of in this area, and that means a lower cash flow from operating activities. The other effect, and I'm talking about this as we expect that we will see more of these effects also in the upcoming quarters, is this finance lease effect. As I have explained, we are bringing in new infrastructure as a customer, which are part of our overall service, so we are not selling, or we have no option to sell the infrastructure. It's part of a service, and this service will be paid within the next 3-5 years. So we have a cash out for the infrastructure now, and the payment will be within the next month and years.
And even if we do a kind of a sale and lease back, it will already be part in the, in the financing cash flow. Next line, cash flow from investing activities. You see here a quite stable level of CapEx compared to the last year. But we also, of course, see the outflow for the acquisitions of ConPlus and IT Total in this area, but much less than in the year before, because we reduced the level of acquisitions of external or inorganic growth. In the financing area, we have an inflow from increase in liabilities.
As I said, we have refinanced the existing structure with new agreements with banks, with quite good results on interest level, at least compared to the market level we see at the moment. So that's the update on the cash flow, and that brings us to our overall guidance and expectations for the year 2023-2024. We are very confident that we will, we will reach our guidance in a very good manner. We have an revenue guidance from EUR 510 million- EUR 530 million. I am very sure we will reach this, maybe even in the upper half than in the lower half.
As I'm seeing the upcoming quarters now, it will depend on if all transitions are really going and ending in time, and we will come into revenue with all customers as planned. That will be the important part, and we are working quite strongly on this. The EBITDA and the EBIT with EUR 77-81 million and EUR 43-46 million on each level, we are also confident to reach this level. As we have explained, you see here the investments we are doing at the moment, and that ends in a lower profitability than in the last year. So even if we have growth in revenues, we have not the same growth in the results.
But as I also said, we expect a bigger payback in the next fiscal year, so we will come back to former profitability when we are receiving the paybacks and the growth from our investing activities. And now I hope I was able to explain a little bit the very high potentials which are behind every of these three areas. So overall, we are quite confident and happy with the half year up to now. We will work strongly on the transitions which will bring our new customers into production as planned, and that's our goal for the rest of the year. So that's up to now. Thank you, and we give back into or to the Q&A session. Thank you.
Thank you so much for your presentation. As mentioned, we will move over to our Q&A session. For a dynamic conversation, we appreciate it if you would ask your questions in person via audio line. To do so, please click on the virtual raise your hand button on the lower part of your screen. If you've dialed in via phone, please use the key combination star key number nine to enter the queue, followed by pressing star key number six to unmute yourself. And if you're not able to speak freely today, you can also submit your questions in our chat box, and we will read them out for you. Having said this, Mrs. Banaschewski, I hand over back to you.
Thank you so much. Thank you, Andreas, for the presentation. Thank you for the explanation. We have our first question from Knut Woller, from Baader Bank. Please go ahead, Mr. Woller. Thank you.
Yeah, hello, and thanks for taking my questions. A couple, if I may. First, if we look at the second quarter, you benefited in terms of EBITDA from capitalized development costs. Can you give us some idea here how we should think about capitalization in the coming quarters, and also looking beyond the current fiscal year. Then on the invest, if I understand you correctly, is the invest something that stays with us, but then we, we will also see the the revenue tailwind and the profit tailwind in the coming years? So should we expect the invest to persist, and then you just see the scaling effect in terms of payback?
Looking at the current development, which is still burdened by the melting down of former contracts, when is this period over, particularly keeping in mind that your focus is now more on organic growth rather than acquisitions? Can you give us some ideas here? Thank you.
Thank you for your questions. Yes, the capitalization effects we have activated, but up to now, only a small part of the tools we are developing, so which have a long-lasting and a long-lasting effect as we are doing our own software development, using the IP we have acquired last year. We are improving it, extending it, building new features into this software. And only for this part, we are doing the capitalization. There, the majority of the work we do, of the investments you see in the costs, so also in our P&A ratio. So it's really the long-lasting part, which is really a part of the tooling and the software we are building.
Your question on investment payback and the persistence of the costs, yes, is totally right, like you've explained or expected. We will keep on this cost level, but what will change is that the payback will pick up. So we will, in our expectation, increase in volumes, but in the same way, not increasing the capacity on the personal level, additionally. So what should be then the situation in the upcoming quarters, especially in Q4, the service revenues will pick up, but no additional personal costs will come in a larger number, will, will be added. As we use the productive personal setup we have at the moment, combined with AI technology, for example, to have, with more productivity, an output of a higher service volume.
So costs will stay on this level, and we will more or less productivate them into more service revenues. Your question on what we've called always transformational revenues. So the headwinds we especially had when we compare last fiscal year with the year before, we had a very strong part of this transformation part. That are revenues which we are reducing and which are coming from former acquisitions, and these revenues, we already knew when we're doing the acquisition, that they will end one day. Sometimes the periods are quite long when they will end, as we are now have just brought down the revenues from an acquisition of an HP company or team in 2016, 2017, for example, but they come one day.
Your question was, how much of this kind of transformational revenue reduction will come in the future? The good message is the biggest part or a very big part was brought down in the last compared to the last, to the year before. For this year, we also still have a smaller portion of this transformational revenue reductions. We are calculating with EUR 16 million in this year, so that is this year's headwind, which is already included in our numbers. For the upcoming further years, we have another EUR 15 million-EUR 20 million. Overall, at the moment, we are calculating something like EUR 40 million-EUR 45 million of remaining transformational revenue cuts, which have to be brought down and reduced in the next years.
At the running year, we see, and part of this reduction is already viewable when you compare Q1- Q2, because Q1 already had a good step down compared to Q1 of the year before, or always the other quarters of the year before. So we already have now in our numbers, a big part of the EUR 16 million. So with EUR 16 million, we are calculating this year, and there be maybe another 25-30 remaining for the further years. But of course, we always try to manage this good, keeping revenues as long they are strong in margins, reducing revenues earlier if they are weak in margins. So we can't really forecast in detail when what will happen, but the overall number is something like 44-45 remaining.
We are calculating with 15-16 this year, and the rest will come in the upcoming years. So this should be your questions, Mr. Woller?
Thank you, Andreas. Just two quick follow-ups, please. The first on capitalization, can you give us a number that we should expect in 2023 and 2024? So will the Q2 level persist in the coming quarters? And then on the digital transformation, if I understand you correctly, is it then fair to assume that from next year onward, we should see DATAGROUP delivering rather higher single-digit growth? Or is that something that is not likely due to the ongoing headwind?
Mm-hmm. So maybe I take the second question first. I like it more. Yes, we will see a higher single-digit growth, I think in the next fiscal year, as only if you imagine the chart with the red growing part. If you-- we only take the full year effect of the last quarter and put it on the whole next fiscal year, we already have a quite strong effect. And even if I reduce it by these EUR 16 million headwinds, I still have a quite strong, or strong, it's depending, but I still have a very good effect on growth. So as long as we have this headwind, I expect single-digit growth.
Maybe in the future, and if we have one day brought out all this headwind, this transformational revenue, and are in a good progress in managing our organic growth model, we might be even able to grow with a double-digit number in the top line, yeah? That's also part of changing the focus of the company, less inorganic growth, which always getting new transformational revenues to the company, instead, really growing only organically. Your other follow-up question on the capitalization. It's always depending on how much development work we do. But you can just continue with the level you saw on Q2, also for Q3 and Q4, with this capitalization.
I would expect it's not much more, but we always will have new developments as long as we are developing this key AI capability, as there are really new tools, new features, and software is created, and that's then part of the asset we are capitalizing there.
Mm-hmm. Thank you, Andreas.
Thank you, Andreas. Thank you, Mr. Woller. There's one more interesting question in the chat with regards to one of the future technologies, the use of AI.
Mm-hmm.
The question is, will the use of AI result in an increased reduction in headcount, or will people be, let's say, have another job within DATAGROUP?
Mm-hmm.
I think that's something interesting for the internal and external world.
Yeah. Yeah.
Thank you.
Very good question, and when we follow our growth path and our growth idea, our idea is not to reduce employment and staff, instead, to make the existing staff more productive. In the past, it was always a question, winning new customers, when, how fast, and in which number we have to set up new staffing to deliver this customer at the end. And sometimes it was really a challenging situation, and we had to hire staff quite early to really be sure as soon as the services are starting, we have the staff necessary for the services in place. Now, using AI, and we are especially addressing new customer workloads with AI, we are able to work with...
or our idea is to work with the existing staff, to have them using the automation with AI in a higher productivity level, and to need much less staff than in the past to service a new customer. So I'm absolutely not expecting any changes in employment. We are working, and that's also an interesting message, we are working really with the people we have in place at the moment, as they are trained to train the engine. They are training the AI systems with their knowledge, and that's not so difficult. It's more a kind of a low- code job, and you're training your knowledge as an administrator, as an IT expert into the engine.
So the AI technology is getting kind of a tool for our administrator, either our experts, I might say, to give them some kind of superpower, to make them much more productive, compared to the past. So we are not expecting a reduction of staff. The lucky situation is, as long as we are growing, bringing new workload into DATAGROUP, we have a much easier situation in handling this workload, as we don't have to hire so much more staff, as we had to in the past.
Thank you, Andreas. I cannot see any further questions. Thank you all for your attention and your interest. Hope to see you again on one of our next calls. Next call is in Q3, in August this year. Thank you. Have a lovely afternoon, and bye-bye.
Thank you. See you soon. Bye-bye.