Tinexta Q1 2025 slides reveal 17% revenue growth, improved margins

Introduction & Market Context

Tinexta SpA (BIT:TNXT) presented its Q1 2025 financial results on May 16, 2025, showcasing strong growth across all business segments. The Italian digital services company reported significant improvements in revenue and profitability metrics, continuing the positive momentum seen in the previous quarter. Tinexta’s stock is currently trading at €10.36, down 2.03% on the day of the presentation, but has shown considerable recovery from its 52-week low of €7.325.

The company’s Q1 performance builds on its robust Q4 2024 results, when Tinexta reported a 15% year-over-year revenue increase. The latest quarterly figures demonstrate accelerating growth, with revenues up 17% compared to the same period last year.

Quarterly Performance Highlights

Tinexta reported consolidated revenues of €115.2 million for Q1 2025, representing a 17.0% increase compared to €98.4 million in Q1 2024. Adjusted EBITDA grew even more impressively, rising 23.8% to €18.7 million, with margins expanding to 16.2% from 15.4% in the prior-year period.

As shown in the following chart of Tinexta’s consolidated results, the company has maintained strong growth momentum:

Despite the positive operational performance, Tinexta reported a net loss from continuing operations of €2.7 million, though this represents a 13.4% improvement from the €3.1 million loss recorded in Q1 2024. It’s worth noting that Q1 historically contributes the smallest portion to Tinexta’s annual EBITDA, as illustrated in the company’s quarterly EBITDA breakdown:

The company’s Free Cash Flow Adjusted reached €33.6 million, increasing 23.5% year-over-year, demonstrating Tinexta’s ability to convert earnings into cash.

Business Unit Performance

All three of Tinexta’s business units contributed to the strong quarterly performance, with Cybersecurity and Business Innovation showing particularly impressive growth rates.

The Digital Trust segment, Tinexta’s largest business unit, delivered a 6.0% revenue increase to €54.4 million, with an EBITDA margin of 29.1%. While this growth rate is slightly below the company’s full-year guidance of 7-9%, management attributed this to temporary delays in contract timing.

As illustrated in the business unit review:

The Cybersecurity division posted the strongest revenue growth, with sales increasing 33.4% to €31.9 million. Even more impressive was the unit’s EBITDA growth of 88.5% to €4.4 million, expanding the margin to 13.8% from 9.7% in the prior year. This performance was primarily driven by increased sales of technology solutions.

The Business Innovation segment showed remarkable improvement, with revenues up 25.5% to €31.4 million and EBITDA surging 204.8% to €2.9 million. This dramatic turnaround was largely attributed to recovery in the Finance & Grants segment in the French market, which had previously underperformed.

Financial Position and Cash Flow

Tinexta continued to strengthen its balance sheet during the quarter, reducing its Net Financial Position (NFP) to €290.9 million from €321.8 million at the end of 2024, representing a 9.6% improvement. This reduction was primarily driven by strong free cash flow generation.

The following chart illustrates the key factors contributing to the NFP reduction:

The company’s NFP/EBITDA ratio stood at 2.54x, showing progress toward the full-year target of 2.2x-2.4x. This improvement in financial leverage provides Tinexta with greater financial flexibility for future investments and shareholder returns.

Strategic Initiatives

A significant strategic development highlighted in the presentation was Tinexta’s transition "From House of Brands to Branded House," which aims to maximize the company’s identity perception and visibility across its subsidiaries. This rebranding initiative is designed to strengthen corporate culture and promote intra-group synergies and collaboration.

The rebranding strategy is illustrated in the following diagram:

This strategic shift aligns with comments made during Tinexta’s Q4 2024 earnings call, where CEO Pirandrea Chevalar stated, "We are moving from a phase of expansion by M&A towards a phase of integration." The company is now focusing on consolidating its recent acquisitions, particularly in the cybersecurity sector, rather than pursuing aggressive M&A activities.

Forward-Looking Statements

Tinexta maintained its full-year 2025 guidance, projecting revenue growth of 11-13% (with 7-9% organic growth) and adjusted EBITDA growth of 15-17% (with 10-12% organic growth). The company also reaffirmed its target to reduce the NFP/EBITDA ratio to between 2.2x and 2.4x by year-end.

As shown in the guidance slide:

Management identified several key performance drivers for 2025, including strong underlying business momentum, regulatory tailwinds, improved operational efficiency, expected reduction in capital expenditure levels, and a solid financial structure to support shareholder remuneration.

For individual business units, Tinexta expects Digital Trust to achieve 7-9% revenue growth, Cybersecurity to exceed 20% growth, and Business Innovation to deliver 10-12% growth for the full year.

The company’s closing remarks emphasized the recovery of operational efficiency across the group, decreased net financial debt driven by strong cash generation, regulatory tailwinds in relevant markets, and tangible results from intra-group synergies reinforced by the implementation of a unified corporate strategy and culture.

Full presentation:

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