Good morning, everybody. Welcome to OHB's Analyst Conference for the annual report 2024. I welcome you here from Bremen. I'm together here with Kurt Melching and Markus Moeller, and we will walk you through the numbers and the information regarding OHB's annual report 2024. We had our balance press conference earlier this morning, and I hope to, let's say, have a fruitful session. I'm not so sure, I'm looking to Marcel, if this event should be in English, because all our visitors are German, but Marcel wants this event to be completely in English, also for the tape that is being produced, so be it. I hope you have been able to download the material. First quick reminder is that our business segment have a little bit changed.
We have now renamed OHB Digital Solutions into OHB Austria recently and moved it to the Space Systems segment. And we had a new corporation a couple of months ago, OHB Space U.K., and that's also part of Space Systems segment. By the way, yesterday there has been a very successful launching event where Markus was in Farnborough. So at least on the U.K. side, there should be some media attention about our new OHB Space U.K. in Bristol. KKR's investment in OHB completed. That's the message. I don't want to go through this chart again. I think you all know it. This is the transaction we have implemented over the last year and a half, almost, where we had our signing in August 2023. We had our closing in September 2024, and this has all been completed.
So we now operate, we exist under the shareholder structure that you see on the right side, 65.4% with the family Fuchs, 28.6% with KKR through Orchid Lux Holding Company, remaining 5.7% free float, and about 0.3% of treasury shares. On the left side, I think this is all well known, voluntary public takeover closed in September last year. Subsequently, listing is under discussion, and this is the shareholder structure as it is for today. Changes to the Supervisory Board. After 22 years, my mother has left the Supervisory Board, effectively with the last year's annual meeting. My mother created the company 44 years ago.
In 1981, she took it over and formed OHB, so it has been a long career, and recently, she completed her 87th birthday, just actually three days ago. No, not three days ago, five days ago. So she's doing well, and the replacement at the supervisory board is since the board nomination, a board approval by the board of Claire is Claire Welby, and she will be also at the next annual general meeting, she will be proposed for re-election, and that will then be the setup of the board, starting from our May 27th annual meeting. Our transformation program is underway. It's going very well. Of course, it's about improving the operational efficiency. Of course, it's about creating the conditions for implementing our growth strategy.
Success has been achieved. This year is the year of execution. I don't want to go in more details about this. Maybe if you have any questions, please ask. I'm running quickly through those slides. Multiple successful launches in 2024, Galileo, Ariane 6, Arctic Weather, Hera, have been big successes, and, of course, a space company celebrates successful launches. Very strong in the Earth observation domain, contract won and signed and implemented for the Harmony passive radar mission. The Sentinels keep us busy. MTG-S is about to be launched soon. Sweden has launched and is operating the Arctic Weather satellite mission, and we're working on a standard constellation to be hopefully implemented in about 18 satellites in the near future.
Space safety is a big domain that we are working on. We had talked a lot about Hera. The following up mission is Ramses, which is under contract, and also on navigation, European navigation with our satellites for LEO PNT, satellite platforms for LEO PNT. We are working on demonstration mission that soon will be launched, and that is in LEO, not in MEO, as Galileo so far is, but obviously for us, a very special moment to return to satellite hardware in the European navigation satellite context. Rocket Factory Augsburg, if I move to the aerospace part, has its launch foreseen for later this year. We hope to launch in 2025 after the successful testing of the engines.
We did have in August last year the first stage loss. You all remember probably the footage of that, so that has been a setback at that time. We have worked our way back with a lot of improvements and completed the improvement engineering, so we're working for that. Obviously, micro launchers are very much heating up. There are more than one micro launcher coming, and 2025 will be the year of initial launches. From our digital area, I can report a record order intake of EUR 170 million last year in the three segments of our digital business division. The midstream, we are very successful with the significant order intake around ground infrastructure for telecom satellites.
The geospatial area, we are working hard to create more and more downstream value around Earth observation data. And in security solutions, our strong business in the digital rail market is helping us, but also other activities. So we are confident that the digital area will also in 2025 have a good growth with significant order intake. I think it's a good development that infrastructure, resilience, security solutions, monitoring is on everybody's mind, and we are very well positioned with the solutions on the ground. So I think this a couple of years after implementation shows that we look at ourselves as a space company, from satellite manufacturing to rocket development, rocket components, and to ground segments and applications and downstream services is evolving very well.
So OHB has successfully moved from being a German satellite builder to a European space company in a 360° way. Just a quick update. I'm starting to go to the numbers. I can only say, and Markus will talk about it later, order intake in 2024 has been delivered. We had in 2023, EUR 920 million order intake, and our plan for 2024 was EUR 1.47 billion, and actually, we came out with EUR 1.67 billion. So that was above our plan, way above our previous year number from 2023. So book-to-bill increased to a ratio of 1.6, which is very good, and we're very happy about that. So the order backlog is increasing.
We talked about this over the last couple of years, where we had this little valley. Yes, and about the order intake we foresee for 2024, Markus will give you a good, quick update in a minute. So I hand over to Kurt for the financial figures. Kurt, you want to come here to this desk and-
Yeah.
Walk our analysts through the numbers?
Okay. Analysts, from my side, we start with P&L overview. You see the comparison between 2023 and 2024. P&L, you see the increase in order backlog to EUR 2.4 billion . This give us a lot of safety and positive perspectives concerning the growth, anticipated growth for the next years. Total revenues are comparable less to the previous years. This has to do with some special effects in 2023, due to the reevaluation of financial instruments, and also with the delay in order intake, which comes later last year than expected. Originally, this is the reason why total revenues in 2024 are lower than expected, but now we have the order intake, we have the backlog, and further intake will come, and this will explain, Markus, later on in this session.
Then EBITDA, operative EBITDA, is EUR 53 million, compared to EUR 163 million in the previous year. This, this is operative. This is a reported EBITDA. We, I will explain it later on, on the slides in detail, how this will, has happened. And then you see the adjusted EBITDA, the first time we report adjusted EBITDA, now 28% higher compared to last year in the operative EBITDA area. Okay, so later on, you will see then on the next slides, what happened with this EBITDA figures, operative and with special effects. This is the overview over the last years.
You see the small decrease in total revenues, as it's already explained, and you see that in the last three years, in principle, there was no substantial growth in the group, which we expect then from 2025 onwards, we will have due to the now substantially increased order backlog and forecast of order intake in 2025. Profitability, the special figures for 2023 and 2024, I explain on the next slide, and then later on, where we want to go in the next years. So here's the bridge. The bridge in 2023 was reported EBITDA, EUR 162 million. Then special effects was EUR -75 million, due to revaluation of financial instruments, especially RFA, since we increased correction of another financial instrument participation. This has led to adjusted EBITDA in 2023 of EUR 87 million.
For 2024, you see then that we bought EBITDA of EUR 53 billion. Then we have this transformation cost due to the costs increased or that has happened last year from consultancy effort, from transformation effort. Together with KKR, we have made a restructuring of substantial areas in the, in the group, and these additional costs are stated here. Then you see the EUR 38 million. This is due to the provision we make for the, at the end of the day, due to the not the operational function of the SARah program. These two satellites are in orbit, but still not full functional, and we will see that, we can be clear, we can recover the satellites, or we have to rebuild two other satellites.
Of course, this case that we have to rebuild the other satellite, we have made this provision of EUR 38 million in the balance sheet 2024. Then there are some other minor effects, transaction costs and stuff like that, which I explained in detail in our annual report. And this will lead then to this adjusted EBITDA figure of EUR 111 billion, which is the best operational EBITDA we ever had. The next slide you see then the outlook for the next years. You see that we expect now significant growth in the next year, substantial growth in the next years, up to EUR 1.5 billion total revenues expected in 2027. And on the right side, you see the profitability margins increase from EBITDA margin from roughly 9% expected in 2025 to 12% in 2027.
EBIT, same development from 6% EBIT expected in 2025 up to 9% EBIT margin expected in 2027. So we are pretty confident then, due to the flexibility of projects we have here and due to the order backlog, that this is achievable, and we are really now back on growth spot. But we are actually doing, we're hiring already a lot of new people, new productive engineers, in order to manage the workload, as additional workload we've had. And the expectation is that we will increase the number of employees, at least for 200 people in 2025. But we are, our HR department is working hard to achieve this target. So this is the financial outlook. Let's come now, Markus, with some further explanations concerning the growth and the order intake. Thank you.
So those figures that we just saw in the future are supported by the, you know, order intake that we can see in the next three years. We've got a pretty detailed planning line by line on orders that, you know, we expected. We had initially forecasted for 2025 a EUR 1.2 billion order intake, as there were some shifts by the customers of projects into 2026. But given that we had a recent win called LISA, one of the L-class science missions that we... Is it on? It's going in. Okay. The reason it's lower, it's actually, you know, a foresight issue.
As you know, our large customers are redoing their budgets this year and next year, specifically ESA, with a ministerial conference that will happen by end of this year in Bremen. And then also the European Commission that will go into a new planning cycle called the Multi-Year Financial Framework, the MFF. And hence, you know, we're working currently now on proposals to support the ambitions of those customers that will then transform into a new project, so that by the end of this year, we will have an updated 2027 figure that we think can be above the 2.3 that you just have seen.
Most of the customers that we serve are institutional, ESA first, EU as a second, and then clearly the German MOD and the reconnaissance services. We have extended the order intake also to selected companies in the United States. That's business that, that despite the recent developments is still... We're very confident. We just recently secured an order from Blue Origin for their new rocket. And we also were able last year to secure a larger software program for MDA, helping them to build the large Canadian constellation around Telesat... Last but not least, as Marco said too, specifically on the aerospace business, we're diversifying.
One of the diversification is to become a strategic partner to deliver the investments of specifically Germany into into the military. So that has to be produced. We have very specific knowledge, it's when it comes to missiles and hence, we're our partner in signed contracts with people like MBDA and DLR, as you can see, as they have to ramp up, and we have that special knowledge, which is a new field for us, and we're operating in since roughly one year. Which brings me also to a potential question that you have is so how can we benefit from the defense initiatives that are now being planned on the European level, but also on a sovereign level here in Germany? Maybe a couple of answers to that questions.
First of all, you know, we in our company structure, as we have systems on one hand, the aerospace structures, but also, the digital unit, we can scale very quickly to meet the demand of the customers. Earth observation is our largest business domain. It's by design, dual use technology that we can now bring in. By design, you know, aero structures can be applied to missiles, and by design, digital is a crucial part when it comes to, advanced data analytics to support, you know, the command, management, and engagement, that the military actually needs. So we anticipate today further investments in strategic reconnaissance, signal intelligence, the military satellite communications, which will increase, space situational awareness is one of the important, new domains that we have.
Also, when it comes to in space operations and orbit operations, on which we are positioned currently now with a civil project that then also can have dual use. We are on a European level the system integration leader for Odin's Eye, which is the early warning systems of missile defense for Europe. We are an established partner, so this business is not new to us. You know, currently in the plan that we have at least 31% of the expected orders between 2025 and 2027 can be attributed to the defense sector.
That is before any new initiative, that is now coming up, and, it's the dialogue over the next month until the end of 2025 that will, you know, give us an, an insight and then further, substantiation on what else can we do to help Europe, to defend itself. With that, over to you, Marco.
Thank you. Yes. Okay. Yeah, thank you very much, Marcus and Kurt. Just a quick update on our organization. Starting April first, we will have Juliane Görke taking over HR responsibilities from Klaus Hoffmann, who was at OHB for the last 10 years at the OHB SE Vorstand in charge of HR activities, and he is retiring now. He will continue to support us as a consultant, as a friend. And Juliane will carry out her job as HR. Actually, not at the Vorstand, but at executive committee level. So what you see here as the chart is starting from 10 days from now, the SE Vorstand will consist of four people.
So it's Kurt, it's Daniela, Marcus, and myself, and then you will see the other C-level, Chief Communication and Public Affairs Officer, Sabine von der Recke, Chief M&A and Investment Officer, Oliver Salisch, who also is in charge of the business unit Space System International, the companies outside of Germany, the Chief HR Officer, Juliane Görke, and, CTO and Digital, Chief Technology and Digital Officer, Kristina Wagner , and, Chiara Pedrazzoli, running OHB System, that is Space System Germany, and Uli Scheib, the Business Unit Aerospace, and, Dr. Arne Gausepohl, the Business Unit Digital. So, we believe that this is a strong team for the challenges, and we are looking forward to work as these eleven individuals in the executive committee jointly together.
By the way, five out of these 11 people are female, so we have six men and five women, so it's a very diverse and strong team, and I'm very, very proud to have this yeah 11, like a football squad, 11 players on the executive level field. All eyes on the next is our Ministerial Conference. That's true. So obviously, everybody here in Bremen in the space community in Bremen is hoping for a successful Ministerial Conference. We have a couple of other milestones by the time that it comes, and looking forward, obviously, that the new German government will be created and formed, and we better understand exactly who is in charge of space.
But of course, we're, we are optimistic that we saw this week, already the creation of the necessary changes to the constitutional framework for the financial side, the so-called, Schuldenbremse or the so-called investment in infrastructure. Looking forward to the fiscal calendar of 2025, no surprises. We have upcoming the three-month report on May eighth, then the annual meeting on May twenty-seventh, which will be again, a digital one, just a digital one. And then in August and November, our, other reports coming up. So this concludes our, brief overview, and, we were within half an hour. That's very good, and I think now I will sit down, and you put the camera on, and we will have the Q&A session. Yeah?
Thank you very much for the time being, and I invite you to ask questions, and I ask Marcel to moderate and, let's say, technically, put you on the loudspeaker in this room. Thanks.
Yes. So please feel free to raise your hand inside the call if you have a question. Let me just give you a moment.
Mm-hmm. Oh, good.
Okay, so apparently there are no questions at the moment.
Okay. So, underlying with, our presentation, obviously... At this moment in time, sorry, my mic was off, so I don't know if they-
It was off.
Yeah, yeah. So, I understand that there are no questions. So by the way, I'm playing around with my microphone. That gives you another minute to think about questions, and of course, you are still invited to do questions. But my final, let's say, conclusion is obviously the space industry is doing very well in Europe and all over the world and also in Germany. Obviously, the strategic relevance of space as such has increased over the last weeks and months. Obviously, all eyes in the public are on the increased investments in defense. That is very necessary for our country and I think for Europe. It's my belief that space will have an integral role in this investment, as Markus laid out.
So overall, I look to the future with a very optimistic outlook. We will grow, we will continue to grow. You saw the growth numbers that we project on Kurt's chart. So I can just conclude that 2025 will be a successful year. I'm very proud of what we achieved in 2024 in terms of transformation, in terms of preparation, in terms of cost saving, but also especially, of course, in terms of order intake. Yes, the numbers compared to previous years in terms of, let's say net income, are much weaker than in previous years. But I guess what is really important is the record adjusted EBITDA, it's the record order intake, and it's the record operative cash flow.
Those are strong numbers, and we are proud of that. But again, our overall improvement program that runs since some time also took us to, let's say, have a few more efforts on other areas. The OHB organization in total is performing very well and still to be improved. So now I look again to Marcel, if there are any questions, and I look to the watch, it's 11:31, so we're basically... We started 2 minutes late. We have not completed the 30 minutes, but I just want to thank you in the name of the three of us here and of the overall OHB organization. And of course, everybody is welcome to contact Marcus, Kurt, myself, and of course, also Marcel.
So, for further questions and, if there are any comments, we will be, let's say, around. And the next event or, as I said earlier, is already, May 8th, so all of you are invited to join us, on May 8th for the... I'm looking to you. May 8th is the right question, right? Right date for the Q1 numbers.
That's correct. We just got one question from Anya Antberger from UniCredit. She asks, "Might the increased strategic relevance and expected growth might result in capacity constraints?
Yes. The answer is yes. If you grow too fast, you have capacity constraints. We're used to this. As a matter of fact, of course, space is booming. Of course, other space players are out there. We are hiring people. We are hiring here in Germany, 180 people, if I remember correctly. We are hiring people in Italy and in other places, in Sweden and so on. We do have a challenge of finding the right talent. We have to invest in infrastructure. We are currently just completing a brand new facility in Sweden, in Stockholm, and we have to contemplate similar investments also in Italy to grow. I think here in Germany, we are well positioned with our current footprint, but of course, these are [Foreign language] .
This is the typical thing you have to do when you grow, when you're part of a booming industry. But especially Juliane Görke now has a challenge to attract talent, and we're very much aware of this.
Thank you very much. No more questions, so-
Very sure. Yeah, then, [Foreign language]