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CESA Group reported robust financial performance for the first quarter of fiscal year 2026, with consolidated revenues reaching €846 million, marking an 8% increase year-over-year. The company’s EBITDA grew by 7.2% to €61 million, while adjusted net profit rose by 6.4% to €29.8 million. Despite the positive results, the stock market reaction was notably strong, with CESA’s stock price climbing 6.39% to €79.9, a significant movement in the context of its 52-week range. According to InvestingPro data, the company’s current market capitalization stands at $409.61 million, with a notably low beta of 0.4, indicating lower volatility compared to the broader market.
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Key Takeaways
- CESA Group’s Q1 FY2026 revenue increased by 8% year-over-year.
- EBITDA and adjusted net profit also saw notable growth, reflecting operational efficiency.
- Strategic acquisitions in Germany and Spain bolster digital transformation efforts.
- Stock price surged by 6.39%, reflecting investor confidence in the company’s future prospects.
Company Performance
CESA Group demonstrated strong performance in Q1 FY2026, driven by a strategic focus on digital transformation and innovation. The company made significant strides in the renewable energy and digital sectors, with organic revenue growth recorded at 2.2% year-over-year. This performance positions CESA as a competitive player in the rapidly evolving digital landscape.
Financial Highlights
- Revenue: €846 million (+8% YoY)
- EBITDA: €61 million (+7.2% YoY)
- Adjusted Net Profit: €29.8 million (+6.4% YoY)
- Net Debt: Improved to €65 million from €75 million in Q4 2025
Outlook & Guidance
CESA Group has set ambitious targets for FY2026, aiming for revenue growth between 5% and 7.5%, and an EBITDA increase of 5% to 10%. The company plans to reduce M&A investments to approximately €30 million annually, while maintaining capital expenditures at around €50 million per year. These strategic decisions are expected to support sustainable growth and shareholder value.
Executive Commentary
- Alessandro Fabroni, Group CEO, emphasized, "We are on track to achieve the main value generation targets for our shareholders."
- Iago Polaschetti, Corporate Sustainability Manager, stated, "Digital innovation, long-term value creation, sustainability and digitalization continues to be the core pillars of our strategy."
- Katerina Agori, Investor Relations Manager, noted, "We will leverage the capabilities and business model we have built over the years to drive sustainable growth."
Risks and Challenges
- Competitive pressures in the digital transformation sector could impact market share.
- Fluctuations in energy prices may affect the renewable energy segment.
- Macroeconomic uncertainties could pose challenges to achieving financial targets.
- Regulatory changes in key markets could impact operational strategies.
CESA Group’s Q1 FY2026 earnings call highlights a company on a solid growth trajectory, underpinned by strategic investments and a focus on digital innovation. The positive market reaction reflects investor confidence in the company’s ability to navigate a competitive landscape and deliver on its ambitious targets.
Full transcript - SESA (SES) Q1 2026:
Conference Operator, Chorus Call: morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the Full Year twenty twenty six Consolidated Three Months Results Conference Call. As a reminder, all participants are in listen only mode. After the presentation, there will be an opportunity to ask questions.
At this time, I would like to turn the conference over to Mr. Iago Polaschetti, Stakeholder and Corporate Sustainability Manager of CESA. Please go ahead, sir.
Iago Polaschetti, Stakeholder and Corporate Sustainability Manager, CESA: Good morning and thank you for joining the CESA Group presentation. Representing the group today are Alessandro Fabroni, Group CEO Katerina Agori, Investor Relations and Corporate Finance and M and A Manager and myself, Secolder Relations and Head of Sustainability. Earlier today, the Board of Directors approved the consolidated financial results for the 2026, ending 07/13/2025. The corporate presentation is available on the Seto website and will serve as a reference throughout today’s conference call. Alessandro will begin by providing an overview of our key business developments and achievements.
Alessandro Fabroni, Group CEO, CESA: Good morning and thank you all for joining today’s call. In the first quarter of the new fiscal year, CESA returned to growth confirming the achievability of the guidance of the new industrial plan. Overall, first quarter twenty twenty six shows a solid recovery in consolidated revenues and EBITDA along with a significant improvement in net profitability supported by substantial reduction financial expenses and the improvement of the net financial position compared to 04/30/2025 with the clear and progressive reversal of the main trends of revenues and profitability. In the first quarter on a consolidated basis, the group recorded revenues for €846,000,000 up 8% and EBITDA of €61,000,000 up 7.2% year on year and an adjusted net profit for €29,800,000 up 6.4% year on year with an adjusted group net profit equals to €27,900,000 up by 4.5% year on year. The trend in human people shows 6,593 employees as of July 2025 with a moderate growth up 0.9% compared to 04/30/2025 in line with our target of growing operating efficiency of the new industrial plant.
On organic basis, revenues increased by 2.2% year on year, EBITDA by 4% year on year and adjusted group net profit by 2.3% year on year compared with the pro form a figures as of July 24 restated to include the quarterly results of Green Sun company acquired last November 24. Consolidated revenues by sector show a positive trend compared with fourth quarter twenty twenty five. ICT VAS with revenues for €497,000,000 down 2.7% entirely organic, showing progressive recovery from the 8.2% decline in fourth quarter twenty twenty five with a return to growth expected from second quarter twenty twenty six following the double digit increase in the July 2025 backlog, Digital Green VAS with revenues for €111,000,000 up 24.7% year on year, driven by 20% organic growth and strong business demand supported by rising energy needs related to digitalization and AI adoption. Software and system integration sector with revenues for euro $220,000,000, up 2.8% year on year despite the slower demand in some key main in Italy districts and engineering activities in some business units. And finally, Business Services sector with revenues for €30.07 up by 3% year on year, which continues to grow entirely organically supported by the increasing focus on digital platforms and vertical applications and the expected acceleration in upcoming quarters, thanks to new agreement with some major Italian banks.
Consolidated EBITDA increased by 7.2% year on year, reaching €61,000,000 up 4% versus the pro form a figures and driven by the 20% growth of green VAS and business services sector, while the ICT VAS and software system integration sector remained broadly stable year on year. ICT VAS achieved an EBITDA of €22,200,000 down 0.9% year on year with an EBITDA margin equals to 4.5% as of July 25, up from 4.4% as of July 24. Digital Green BES reported an EBITDA of €6 point two up 18% year on year with an EBITDA margin of 5.6% as of July 25, slightly down from 5.9% as of July 24. Software and System Integration sector achieved an EBITDA of €23,500,000 down 2.7% year on year with an EBITDA margin equals to 10.7% as of July 2025 compared to 10.8% in the full year 2025. This reflects the reengineering operation in some business units with EBITDA margin expected to stabilize in full year 2026 at the same level of the full year 2025.
Business services reported an EBITDA equals to €7,300,000 up by 25% year on year with an EBITDA margin of 20% driven by the progressive focus of revenues on proprietary digital platforms and vertical applications developed over the past two years. Adjusted consolidated EBIT was equal to €47,300,000 up 4.2 year on year after depreciation and amortization of tangible and intangible assets equals to €12,700,000 up 15% year on year and provisions for around $700,000 As expected in the new industrial plan, net financial position show a significant reduction equals to 12% compared to first quarter twenty twenty five and equals to 36% compared to fourth quarter twenty twenty five, driven by lower interest rates and efficiency measures in group financial management. The first quarter adjusted consolidated net profit was equal to €29,800,000 up 6.4% year on year, reflecting a stronger operating profitability and reduction in financial expenses. The adjusted group consolidated net profit reached $28,000,000 up 4.5% year on year and up by 2.3% versus the pro form a figures as of July 24. Finally, consolidated reported net financial position as of July 2025 equals to a net debt of €65,000,000 shows a significant improvement compared to €75,000,000 as of 04/30/2025, thanks to the operating cash flow in the quarter and lower investment compared to the previous year with CapEx and M and A equal to approximately €11,500,000 in first quarter twenty twenty six alone.
Now I give the floor to Caterina to present our new strategy in terms of M and A and the main resolution of the last shareholders meeting held on 08/27/2025.
Katerina Agori, Investor Relations and Corporate Finance and M&A Manager, CESA: After years of significant M and A investments, our new FY twenty twenty six, twenty twenty seven industrial plan marks a strategic shift focusing on group simplification and organic growth. We will leverage the capabilities and business model we have built over the years to drive sustainable growth, supported by dedicated CapEx in AI and automation to enhance efficiency, scalability and market penetration. As a result, annual M and A investments are projected to decline to around 30,000,000 guided by selective value driven strategy, while CapEx is expected to remain at approximately EUR 50,000,000 per year. In the 2026, we further strengthened our international presence through only two strategic acquisitions, with total investments of approximately €7,000,000 Visicon GmbH in Germany, an SAP consulting specialist with €5,300,000 in revenues. And Delta Technologia de Informacion in Spain, an AI driven player in digital identity with €2,000,000 in revenues.
Both companies deliver EBITDA margin above 10%. This acquisition confirm our strategy, a selective approach to high value M and A in Europe, combined with strong investments in digital transformation areas such as AI, automation and digital platforms. As outlined in 2026, 2027 industrial plan, we are focused on generating strong cash flow and delivering solid returns to our shareholders, as demonstrated by our last shareholder meeting on 08/27/2025, where we approved a dividend of one point per share, in line with the previous year, a significant increase in the share buyback program from €10,000,000 in FY 2025 to €20,000,000 for the coming year, almost three times the previous amount to further enhance the shareholder value by increasing the payout ratio from 30% of the last year to 40% of the current year. We have already started the program the day following its approval, underlying our commitment to creating sustainable value for our shareholders. Then the cancellation of treasury shares up to a maximum of 2% of CESA share capital over the next eighteen months.
As of 08/27/2025, approximately 1% of shares had already been canceled. I now invite Iacopo to present our ECG results for the 2026.
Iago Polaschetti, Stakeholder and Corporate Sustainability Manager, CESA: Good morning and thank you, Caterina. In terms of sustainability path, in light of the new CSRD regulations and the new ESG standards, we confirm our strong commitment to value generation for our stakeholders. And we continue to invest in sustainability and environmental protection, supporting intensively our customers to be responsible on the management of natural resources. By the way, our digital green sector contributes significantly to reduce overall CO2 emissions, thanks to our leadership position, which all of us to improve the sustainability profile and performance of our partners. In light with our ESG growth path, our sustainability plan for 2026 and 2027 defines priorities, targets and specific actions to integrate sustainability in our business model, contributing to the creation of long term value for our stakeholders.
On this point, our last results were characterized by significant improvement in ESG performance and the achievement of some relevant sustainable development goal set. We reinforced our group purpose that confirm our corporate values and goals of long term sustainable value creation for the benefit of all stakeholders. Digital innovation, long term value creation, sustainability and digitalization continues to be the core pillars of our strategy, defining the group’s purpose. We also continue to extend our main group certification confirming all of our ESG ratings. In terms of HR management, we are facing a consolidation phase with an increasing focus on work and collaboration efficiency and the progressive integration of our enablers in our organization and the way we work.
After a big improvement of our human capital over the last four years, in the first quarters of the new fiscal year, we increased the headcount by 0.9% only, in line with our strategic industrial plan. We continue to work to further improve our loyalty rate, reinforcing at the same time our education, hiring and welfare programs with wider and specific measure to support parenting, diversity, well-being and work life balancing. Thanks to dedicated programs in favor of diversity and inclusion. Now, I give the floor again to Alessandro for the final conclusions.
Alessandro Fabroni, Group CEO, CESA: Thank you, Catherine and Iacopo. I will now share the final remarks and conclude our session. Three months ago, we presented our new industrial plan aiming at group’s transformation by focusing on organic growth to our core businesses, organization streamline, growing operating efficiency and market penetration by reinforcing our role as leading digital integrator and partner of customers’ digital transformation. In the 2026, we worked strongly to deliver the main strategic targets of the industrial plant, driving organic growth across the group sectors, streamlining legal entities and adopting AI and digital enablers to boost operating efficiency. In particular, in the 2026, we achieved a 25% growth in profitability of business services sector, driven by the expanding market penetration of our proprietary digital platforms and vertical applications developed over the past two year, a double digit organic growth in both revenues and EBITDA for the digital green VAS sector fueled by strong business demand and rising energy needs driven by digitalization and AI adoption.
Recovery in ICT VAS trend compared to fourth quarter twenty twenty five with a double digit backlog growth in the month of July and August 2025, supporting an expected return to a year on year growth from the second quarter twenty twenty six. And we also achieved a significant reduction in the net financial expenses, down 36% compared to fourth quarter twenty twenty five and down by 12% compared to first quarter twenty twenty five, reflecting the ongoing recovery trend supported by lower market interest rates and the efficiency measures implemented during FY 2025. Thanks to our strategy, we strengthened our position as a leading digital integrator with a strong focus on cybersecurity AI, automation vertical application and digital platforms. And at the same time, our business services sector continue to grow in the financial services industry, driven by rising demand for specialized vertical platforms and applications. In the light of our first quarter twenty twenty six strategic achievements and the disciplined way we have been executing the new industrial plan, today we confirm our commitment to deliver all growth targets that we have outlined last July for the new FY 2026.
This means a 5% to 7.5% growth in revenues, a 5% to 10% increase in EBITDA and about 10% improvement in net consolidated profit confirming that we are on track to achieve the main value generation targets for our shareholders. Considering the positive trend of our net financial position improving by around €10,000,000 compared to 04/30/2025, we are delivering the planned 40% payout ratio compared to the 30% of the previous year by executing the new €25,000,000 buyback program approved by our last shareholders meeting. Now we will continue to execute the new industrial plan with strong discipline focusing on organic growth, operating efficiency, the adoption of digital enablers and inspired by a corporate vision oriented towards sustainable growth and digital innovation. Thank you very much for your kind attention. Now we open the Q and A session.
Conference Operator, Chorus Call: Thank you. This is the Chorus Call conference operator. We will now begin the question and answer session. The first question is from Andrea Andona, Intermonte. Please go ahead.
Andrea Andona, Analyst, Intermonte: Thank you, and good morning to everybody. My question is about the outlook you provided for the business segments. We can see that Digital Green is performing slightly ahead or, I can say, ahead of initial expectations while maybe software system integration is a bit softer. So my questions are what is the visibility you have on the most recent months? And if you can provide some indications on the full year profitability you are expecting compared to what we have seen in the first quarter?
And any further comment on this the expected evolution of the business segments is welcome. Thank you.
Alessandro Fabroni, Group CEO, CESA: Good morning, Andrea. Thank you for the question. So first of all, the trend of business segment is characterized by growing focus on proprietary digital platforms. So that means, as a result, growing level of EBITDA margin that will achieve record 19.9% of revenues. So we grew by 3% in terms of revenue.
We expect to accelerate the trend of revenues, considering also several main contracts that we won during the first quarter and that we will account starting from the second quarter. So our guidance continue to be a double digit growth in terms of revenues and in particular in terms of profitability. In the Digital Green, we capitalized the great effort we did in the last quarter. So the merger between PM Service and GreenSun created a leading player in China market. We increased our market share in the business segment.
There’s a great demand of energy from renewable sources considering the low prices that stabilize. So the trend of prices were stable in the quarter. So the lower level that we achieved over the past year and a half made very competitive the green energy solution. And there’s a great demand from corporate organization in that direction. So the trend of the market is a trend of high single digit growth, and we plan to be able to over perform to continue to grow double digit, thanks to our competitive advantages and our market share we achieved in Italian market.
The situation of the software system integration the quarter characterized by recovery of EBITDA marginality in comparison to the fourth quarter because we performed with a 10.7 compared to 10.2%. We expect to stabilize this level around 10.8%, 11% and so to start increase also in terms of EBITDA quarter by quarter. So our feeling is that the first quarter of that fiscal year was the most difficult to face because we are in the beginning of the industrial plan. But the actions that we perform, we will disclose most of their effect in upcoming quarter. So that is the reason today we confirm the consolidated guidance for the whole group with visibility level that increased a lot compared to three months ago.
Andrea Andona, Analyst, Intermonte: Thank you. Thank you very much. Very helpful.
Alessandro Fabroni, Group CEO, CESA: Thank
Conference Operator, Chorus Call: The next question is from Gabriela Berti, Intesa Sanpaolo. Please go ahead.
Gabriela Berti, Analyst, Intesa Sanpaolo: Hi, good morning, everyone, and thank you for the presentation. First question on CapEx. Considering you mentioned a shift in the CapEx mix used from M and A and internal development? Where do you see CapEx in these fiscal years? And how much will be dedicated to internal development?
And if you could also provide some color on which kind of projects are you developing? And then second question, if you could elaborate on the driver behind the acceleration in the backlog for the VAS segment. Thank you.
Alessandro Fabroni, Group CEO, CESA: Good morning, Gabriela. Thank you for the question. Yes, in terms of CapEx, including M and A investment, we had around EUR 11,500,000.0 in the first quarter, of which EUR 7,000,000 M and A. So that means we are more or less on track because our full year indication is an indication of $2,580,000,000 euro, of which thirty, thirty five dedicated to selected M and A. So the internal development refer mainly the so called digital enablers adoptions.
So that means AI automation and also the development of digital platforms and vertical application for penetrating the market and also for our organization. In terms of trend of ICT VAS, first of all, we closed a quarter with an upturn in comparison to the trend of the fourth quarter. So we declined 2.5% compared to a decline of 8%. But in particular, we closed the quarter with very, very positive trend in the backlog. The backlog increased by over than 10% in July, over than 10% in August with a good start in September.
And so considering also the trend we had in the previous year, now we expect to recover a positive increase in revenues starting from the second quarter. I remember that our indication for the full year is to grow low single digit in terms of revenues and EBITDA and double digit in terms of net profitability. And in fact, in the first quarter, we increased in terms of net profitability in this sector by around 17%. So that means we are on track not only in terms of trend of revenues and EBITDA, but in particular also in terms of profitability and net income.
Gabriela Berti, Analyst, Intesa Sanpaolo: Thank you.
Alessandro Fabroni, Group CEO, CESA: Thank you.
Conference Operator, Chorus Call: The next question is from Guy Breeden, Quilter, Cheviot. Please go ahead. Mister Briden, your line is open. Maybe your line is on mute. Unfortunately, we cannot hear you.
Could you please open up your line? Maybe you’re muted. The next question is from Paolo Cipriani, a private investor. Please go ahead.
Paolo Cipriani, Private Investor: Morning, Alessandro. Can you hear me well?
Alessandro Fabroni, Group CEO, CESA: Yes. Very well. Yes.
Paolo Cipriani, Private Investor: Yes. I have a question regarding the financial expenses that are improving and should be expected to improve further. Could you just maybe help a bit understand what they’re a bit more just to something a bit more on what they’re related to. I mean, just an update, example, related to the acquisition of the previous small companies acquired in the previous years I mean, to the working capital management of these companies? And maybe just to say something about the full effect of cost optimization initiatives that seems to, I mean, improve these financial charges?
Thank you.
Alessandro Fabroni, Group CEO, CESA: Thank you for the question. So first of all, we are capitalizing two main factor. The first one is the lower level of interest rates. I remember that in any case, we will benefit in progressive way because several financial costs are accounted for in advance for three, six months. And so we will benefit moving forward.
The second one is obviously the improvement that we are achieving in working capital management and also in several other measures that we are introducing starting from one year. So the lower number of legal entities, the adoption of cash flow and obviously, planning and generally speaking, the identification of planning and several targets for any group’s legal entity. So the start of the fiscal year was positive because of the comparison with the previous year in terms of first quarter twenty twenty five was a comparison with an improvement by 12%. But if we compare the first quarter twenty six with the fourth quarter twenty five, we improved by 35%. So that is the reason we expect to accelerate in our progressive improvement quarter by quarter.
Thank you. Thank you.
Conference Operator, Chorus Call: Gentlemen, Mr. De la Scape, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.
Iago Polaschetti, Stakeholder and Corporate Sustainability Manager, CESA: Okay. Thank you very much. As usual, we stay available, via mail for any additional information and thank you very much for your participation.
Conference Operator, Chorus Call: Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.
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