Welcome to the DATAGROUP SE conference call on the Q3 figures for the financial year 2021-2022. At the moment, all participants are on mute. The floor will be open for questions after the presentation. If you would like to ask a question, please press the hand symbol or type your question into the question box. We will then call the questioners according to the order in which they raised their hands. Please unmute yourself to ask your question and then mute yourself again to prevent acoustic disturbances for the other participants. The presentation is also available for download in the Investor Relations section on DATAGROUP's website. I would now like to welcome Mr. Oliver Thome, CFO of DATAGROUP SE.
Thank you very much. Ladies and gentlemen, I welcome you on the analyst call for the Q3 figures of DATAGROUP. My name is Oliver Thome, CFO, and would like to start a little bit in another way, like in the past and means. When you look, the current times are influenced by different uncertainties. We have the war in Ukraine, Russia. We have the delivery problems for high-tech products. We have the inflation. Last but not least, we have the search for professionals, especially in the IT sector.
Before we start in the very strong result of DATAGROUP in the third quarter of the fiscal year 2021-2022, I would like to focus you on our business model and to get a better understanding for you what we are doing and why we believe that in the current crisis can be a chance for our business model. Let us have a first look on what we are doing. What we are doing is, in a summary, we run your IT, and you have the possibility to focus on your core business. That means that we are focused on the German market for companies with a revenue size between EUR 100 million and EUR 5 billion. We rank as the leading IT service provider with about 3,500 employees only in Germany our IT production.
That shows you that the war between Russia and Ukraine is has no impact on our business model. How do we work? In the center of our strategy is a full service offer for companies as a USP, and we call it our CORBOX. The CORBOX is a modular offering product as a service approach with which we are able to perform our customers and their IT. Besides this, you can see on the left side the IT transformation. That means how we are transferring the cloud platform application or SAP from their own systems to our CORBOX. On the right side, it's very interesting and important to see we have the IT solutions. The IT solutions are the segment in which we have our own consulting for the digitalization for our customers and their business.
What we are doing there is to bring them to the digital time, and what we can do with this is that we can use these technology for us as well. What we do not do is we are no hardware vendor, so the delivery problems you can see are no problems of our business. What we are doing is our CORBOX and the base of the CORBOX is the standardization. The standardization is last but not least the base for automation. On the right side, we have seen in the CORBOX picture is that we use our own technology and the knowledge for our own business to compensate the expected wage inflation in the mid and long term. How do we work?
We work with a centralized, virtual business unit for our operations, our service desk, our SAP, or our application management service, and offer these services to our market companies which can offer these products for our customers. This is much more efficient. It's more scalable in the workload. Let us have a look for what are the drivers for our business future. The driver future will be what they have in their business, they will try. That means they have run their own IT and still they have security aspects and really the need for cyber attacks. With our long recurring revenue side of our contract, especially working on the employee side.
Before we start with the employees, I would like more details of the view on contract types, how we work with our customers. What you have seen in the picture of our CORBOX on the left side, we start with a traditional transition. This transition period mostly is between 6 months-10 months. After this, the contract phase one starts. The contract phase one is between 4 years-5 years, and normally will be increased in the contract phase two, so that we have the duration up to 8 years with our customers. This guarantees us recurring revenues, recurring margins in our business, and so very plannable margins. On the other side, you see the very strong order intake with the CORBOX, with our CORBOX business.
You see that in this year, we won CORBOX orders in market units and exhibitions and software development, energy, the public sector, logistics, industrial bakery, as well as, toy manufacturer. You can see we do not have any cluster risks, sector risks, or market risks. Here one example what we won this year, and Koelnmesse is, for us, a very good customer and international exhibition corporation. It's number three in Germany and, among the top ten in, worldwide. We won this Koelnmesse offering with a full stack offering of our CORBOX production possibilities. It's a 60-month operation, after the meanwhile running a 10-month transition, we are very happy to get access to customer like Koelnmesse. Now we start with this what I've explained. We have a very strong employer branding.
We do very much on the market to win the challenge for the best professionals in IT sector. This allows us to get these professionals to run the IT for our customers. This is why we are very open-minded, and we are looking forward positively to the future that we were able in the combination between our digitalization knowledge, in which we can make more efficiency into our standardization, and on the other side, that we collect top marks as employer and to get the best professionals we need to get more order intake into our CORBOX and very good contacts to new customers. What we have done further is the development of our security services.
The security services are very important, are included in our CORBOX and very important to have our own Security Operations Center. Our Security Operations Center with in-depth security experience and tooling for protection, monitoring of the CORBOX platforms. We are very good and stable positioned to get in touch with the future, and we believe that the shortage for professionals especially in the security service will push our business into the future. Let us now have a look at the estimation for the current fiscal year. We just had a look at the revenue side between EUR 480 million and EUR 500 million.
As I just explained in our business model, we have very strong recurring revenues, recurring margins with our CORBOX, with recurring non-cloud services, so that we had an estimation of reaching an EBIT between EUR 39 million and EUR 42 million. Now let us have a look at the excellent Q3 results. We have had a very strong performance across all DATAGROUP market units. Like I just explained, we do not see negative impacts from the war in Ukraine or in the supply chain bottlenecks. The outstanding performance from the new acquisitions, URANO, BIT Oldenburg, and HIT has worked quite good.
As you have already seen maybe in the press release for the first nine months, we started very well, and we have a very strong Q3 in the actual fiscal year 2021-2022. We have a substantial increase in our revenue side of nearly 13% up to EUR 372.9 million. Our organic growth of 0.5% during the past twelve months, sorry, is within the expectation of the management. Let us have a look in the very strong previous year. In the previous year, we had very strong one-time project revenues, mostly driven by the COVID pandemic and these one-time project revenues could be covered in this year by high margined CORBOX business. That is what we can see in the EBIT margin.
The EBIT margin which increased in the same period from EUR 47 million by more than 24% up to EUR 48.3 million. Very, very nice is that we were able in this year to perform with our CORBOX. We just reached 15 new customers, 32 contracts renewed and 19 contracts have been expanded. You see the same development in our EBIT and the great development of our EBIT with more than 50% up to EUR 32.7 million is also reflected in the EPS, which rose by 23.9. This means nearly 24% up to EUR 2.39. Let us have a look on some selected profit and loss figures.
Like I just explained, the revenue side rose by nearly 13% to EUR 373 million. The gross profit rose in nearly the same range. Very important to see, and this is what we have seen in the past quarters as well, is that the personnel expenses only rose by 9.2%. Reached a really nice development in the EBITDA and the EBIT as well. We can have a look at some selected balance sheet ratios. The increase in goodwill is due to the acquisition of the Hövermann IT in this year, as well as the URANO and the BIT Oldenburg.
Very important, and this we can see in the cash flow statement one slide later, that the net debt amount is stable to the past year, so we were able to pay the investments in the new companies from our own operating cash flow. By the way, the net debt EBITDA ratio of 1.1 is really great and with this we are very fine with our partners in the finance sector. Let us have a look on the cash flow side. This is, I think, where we can be very proud on because we earn money with a change of about more than 40%. This shows in the cash flow from operating activities the strength of the DATAGROUP companies.
What did we have done with this company with the money we have earned? We invested it, but only in a very small way in the CapEx with lower than EUR 6 million in the first nine months, and especially as for the outflow for acquisitions. Those of you who have been with us for a long time know the excellent development from the share price. Last but not least, in the year 2022, we have an impact like the whole stock exchange in the world, so that our share is currently affected as well. We are nevertheless very satisfied with the development from the long time period.
We are optimistic for the future and for our business model that we can keep pace with the development of the past. Let us have a look at a short extract from the financial calendar. You see, we continue this year very actively to present our company to the existing and potential investors and to show the attractiveness of the DATAGROUP business model and the DATAGROUP in Germany to present it in Europe and in the U.S. we have done in this year, like in the past years as well. Thank you very much from my side for the presentation and now I will be glad to answer your questions.
The floor is now open for questions. If you would like to ask a question, please press the hand symbol. You will then be called and be able to ask your question. Alternatively, you can type your question into the question box. First, we got a question from Mr. Knut Woller, and he asks several questions. First one is: What measures do you take to accelerate organic growth in the coming years?
Okay. The organic growth in the future will be driven especially by this what I've explained our business model with the need from our customers to outsource their IT. What's not reflected in this moment is what we have made in the presentation. We have 15 new customers in our CORBOX, but they are in the phase of the transition period, and so they cannot be part of the organic growth at this moment. I think we have to look for it. I think that we will be in a range between 5% and 7% of the future organic growth with our CORBOX business. Maybe it can rise up when we are able to put in more pressure and put in more technology and efficiency.
I think this will be a range of 5% up to, yeah, 5%, more or less, maybe a little bit more.
He also asked if you can provide us with an update on your M&A strategy.
The M&A strategy is really the same what we have done in the past. Mr. Woller, you know that we have changed it a little bit. We have said we make the growth one-third organically and two-thirds inorganically. Because we now see that our CORBOX, especially we have made more technology, and as our newest CORBOX, it's called the CORBOX 3, is now possible to onboard more customers on this technology. That we have said, "Let us have more look on the organic growth and to turn it a little bit to 50/50." That means that we will still running our acquisition story. We will focus more on our organic growth.
Nevertheless, we have the two pillars. It's organic and inorganically.
Regarding M&A, he also asks if price expectations come down, and should we also expect larger M&A again going forward?
It's a very good question, and this is what you see in this moment, that or my expectation is that the rising up of the prices from the past years, and you have seen what we have paid out for companies five years ago and what's now. This is M&A sector and IT industry. It's very much influenced by private equity meanwhile. They bring up the prices, but now the inflation and the rising tax rate, and my expectation is that it will at minimum stabilize the target prices. We select our targets especially from what kind of synergies can we bring with our business, and we can bring them into the future with our standardization of our CORBOX.
It's more or less not the question what we have to pay for the company. It's more or less which strategy do we follow with these companies, to bring them into the range of our EBIT estimation. To answer the question, I think it will stabilize. If they go down, we have to see. When there is the possibility to get a bigger target, the question, what's a bigger target? What we have done in the past is between EUR 10 million and EUR 50 million. This is quite on the upper side or the upper level, is what we can do. When the acquisition possibilities get bigger, we have to look for the strategy in which we can include them into a DATAGROUP business model.
Okay, thank you. Last question from Mr. Woller was regarding the inflation. He asks, "How do you offset inflation, rising energy costs and wages," for example?
The inflation, we start with the inflation. What we try in the past is that we have an inflation rule in the contracts, so that from this size doesn't happen anything. We have as well other contracts in which we do not have this. The question is, where do the prices for us rise up? Energy prices are for us only a small part. You know that the wage inflation is for us much more in our focus, and this is where I explained in the business model for what we are looking because the wage inflation in IT industry is what's. It's very broad.
It's happened with our competitors. It will happen with us as well. In our business model, with the standardization, with the status of standardization, this is quite unique. We are able to use more technology in this sector to compensate this on a mid- and long-term level.
Are there any more questions? You can press the hand symbol if you have a question, or you can type it into the question box. Mr. Robak has a question.
Hi, Oliver Thome. Can you hear me okay?
Yes, we can hear you. Hi.
Perfect. Thank you. Thank you for taking my question as well. I just have one because most of my questions were already asked and answered. Just some guidance for the full year and into Q4. It seems like,
You're on track to hit the upper end of your guidance. Could you just give us a little bit of color on what you're seeing in the market for Q4 and kind of how we should think about the fourth quarter of your business, just seasonally, given everything that is going on in the economy today?
Yes. I would like to do this. This is where we have looked as well. The big pillars we have now made that we have said, "Let us be conservative and do not raise the estimation." We only confirm the estimation because we have to look what will happen, how we can implement for example technology, what will cause this. Maybe you know us. You are with us since a long time. I think we are. We have always been conservative, so we only have the estimation confirmed.
You now see we have now reached a sales range on the upper side and on the EBIT side, we are in good mood as well. We are not in the time to say that we can rise up our estimation for the current year. We will see, but not at this moment.
Okay. Thank you. Maybe just a quick follow-up. Could you give us some reasons for why? Is it that you have limited visibility? Is it just that you prefer to be conservative, like you talked about? Or, yeah. Just a little bit more color, please, would be great.
Yes. It's more or less the question what in Q3 happens, like in the past here. When you look, one of the customers we have just in our order books is the vaccination centers, for example. The vaccination centers were normally very strong in the fiscal year, the Q1, Q2, and Q3, a little bit, and Q4, normally not so much because, you know, there is no COVID pandemic. There's nothing to vaccinate in this quarter, so that we have to see which impact comes out of this.
We are a little bit more conservative to see what will happen on this case.
All right. That's great. Thank you very much.
No problem. Thank you.
We have a question from Mr. Sehring.
Mm-hmm.
Yeah. Thank you. Good morning. Also from my side, just one question left. Maybe talking a bit more about the midterm, especially on the EBIT side, you have made very strong progress, and pretty much approached your target margin. Could we expect any updates to this target margin over the next couple of quarters? Or, yeah, what's basically the potential that you see going forward?
Mr. Sehring, very nice and very good question. You know our estimation for the next quarters, we normally do in the general meeting in the next year. We evaluate this, we are optimistic that we can go further with a good development. We have to see, but the things that the inflation as well, what happens with our customers, you know. Most of our business is recurring business, so we are very plannable. But some of this are extensions that we are able to exceed the CORBOX business with project services, for example.
We have to look, therefore, we have to evaluate this because the situation of the inflation, the wage inflation for our customers, for ourselves, so that we have to evaluate it to plan this. I'm not just able to give you forward outlook. Besides this, what we just give on our mid-term guidance. At this stage, we do not make any difference and we confirm the guidance. We do not see anything on this. The times we have now are very turbulent, I will say. Not only for us, it's for the market. On the long-term side, this is what I've explained to you in the presentation.
I'm very optimistic that we will be a winner of this crisis. How it will cost or focus and enforce our accounts in the next years, we will see. As well, we have made the presentation of our estimation and we confirm this.
Thank you.
I'm not sure if I'm seeing still a hand raised from Mr. Robak, or is it another question from. Okay. Hand is down, so I guess there is no further question. If there are no questions, then we will make available today's call on the website. With this information, I will hand over to Oliver Thome again.
I would like to say thank you very much and see you soon. Take care, and see us next time. Thank you very much.