Quadient new strategic plan “Elevate to 2030” aims at delivering
more than €1bn of annual subscription-related revenue and €250m of
current EBIT in 2030
Quadient new strategic plan “Elevate to 2030”
aims at delivering more than €1bn of annual subscription-related
revenue and €250m of current EBIT in 2030
Key highlights
-
>€1bn annual subscription-related revenue as financial
ambition for 2030, a €250m+ increase vs 2023 level, and
c.€250m in current EBIT, a €100m increase vs 2023
level
-
Total revenue to reach €1.3bn in
2030 driven by double-digit growth in
both Digital and Lockers and a resilient Mail automation
platform
-
All Solutions to converge to a 20%-30%
EBITDA margin range by 2030
-
Committed to reaching a Net Zero target by 2050,
in line with SBTi methodology
-
With a more customer-centric platform, Quadient
aims to continue to lead in Mail and win
both in Digital and in Lockers with a focus on delivering
sustainable and profitable recurring revenue growth
-
Financial guidance for the next 3-year period
(2024-2026): minimum 1.5% revenue CAGR and
minimum 3% current EBIT CAGR, both on an
organic basis
-
Average capex expected at €100m per year
from 2024 to 2026
-
Further deleveraging expected with leverage ratio excluding
leasing targeted at 1.5x in 2026
-
Dividend policy maintained at minimum 20%
net income payout, while considering share
buybacks to return potential excess cash to
shareholders
-
“Elevate to 2030” will lead to a stronger investment
proposition relying on faster long-term
growth, higher profitability and a
disciplined capital allocation policy over the
period
Paris, 19 June 2024,
Quadient S.A. (Euronext Paris:
QDT), a global automation platform powering secure and sustainable
business connections, holds today its 2024 Capital Markets Day,
during which its management unveils its new strategic plan
entitled: “Elevate to 2030”, including financial guidance for the
next three years as well as ambitions for 2030. The plan aims at
building on the strong foundations laid over the past five years
through the “Back to Growth” strategic plan – which led to a clear
repositioning of Quadient as an intelligent automation platform.
This platform is delivering essential benefits to c.350,000
businesses of all sizes, supporting them in their digital
transformation. Quadient’s Intelligent Automation Platform offering
spans from business communication and financial processes to mail
automation and parcel pick up and drop off applications. Based on a
customer-centric approach and supported by a recurring and
sustainable business model, the new strategic plan “Elevate to
2030” provides a solid financial outlook based on faster long-term
recurring revenue growth, higher profitability and a disciplined
capital allocation policy over the period.
Geoffrey Godet, Chief Executive Officer of
Quadient S.A., stated: “In 2019, after I joined Quadient, we
embarked into a first strategic plan aiming at transforming the
Company and setting it onto a sustainable and profitable growth
trajectory. We successfully closed this plan earlier this year with
the FY 2023 results, turning Quadient into a company focused on
creating shareholders value by leveraging its existing asset base
and delivering growing recurring revenue. Today, I am pleased to
introduce Quadient’s new strategic plan: Elevate to 2030.
Elevate to 2030 is our commitment to accelerate
the existing growth trajectory and propel Quadient as the leader in
intelligent automation. Our strategic plan is built upon four
simple yet powerful key pillars. First, we focus on customers with
a greater value proposition powered by our innovative automation
platform leveraging Artificial Intelligence. Second, we drive
higher recurring revenue through more cross-selling, increased
customer penetration and market share gains. Third, we continue to
raise the bar in terms of sustainability through ambitious ESG
goals and a commitment to achieving Net Zero by 2050. Finally, all
this translates into a strong investment proposition. Our ambition
is to reach, by 2030, more than €1 billion in subscription-related
revenue and more than €250 million in current EBIT, with an
accelerating trend driven by the favorable change in business mix.
Our plan is supported by a disciplined capital allocation policy
over the period. This new journey will give us the opportunity to
grow our Digital and Lockers automation platforms further, in two
rapidly expanding and yet underpenetrated markets, while continuing
to leverage on our Mail customer base to accelerate that growth.
Supported by a long-term history of innovation and global
capabilities, Quadient is now on an attractive sustainable and
profitable growth journey.”
A superior value proposition that meets
powerful market trends
Quadient’s vision is to power the
world’s most trusted connections between businesses, their data and
their customers. The business world is increasingly driven
by the need for more digitalization, the higher use of Artificial
Intelligence (AI) and automation, the constant rise of e-commerce
and greater consideration of ESG criteria. Being at the junction of
these four main business trends, Quadient is supporting businesses
of all sizes in their digital transformation and growth journey to
unlock operating efficiency with reliable, secure and sustainable
automation solutions. Thanks to its scalable, flexible and
reliable Intelligent automation platform, Quadient
provides its customers with a superior value proposition that
positioned the company as a partner of choice for
intelligent, sustainable and compliant digital
transformation. Its intelligent automation platform
accelerates the transition towards digital connections, using
AI-powered automation features to process large volumes of complex
data. The platform also automates mail and parcels management while
providing differentiated and seamless digital customer experience.
Additionally, Quadient’s solutions bring positive ESG impact
through the reduction of CO2 emissions, thanks notably to the
remanufacturing of mailing equipment, the digitalization of
documents and connections, as well as the greater efficiency of
parcel pick-up and delivery.
With three automation platforms
(Digital, Mail and Lockers) built on a common subscription business
model, Quadient aims at delivering growth through a
two-pronged go-to-market approach based on acquisition of new
customers and expansion within the existing base. Operating in
attractive markets, Quadient targets to add c.16,000 additional
customers and locker installations every year continuing to build
on an already at-scale customer base. The Company is also committed
to leveraging this large existing base of c.350,000 customers by
cross-selling and up-selling its wide range of applications.
Indeed, the uniqueness and key differentiator of Quadient lies in
that ability to sell several applications to an existing customer
whether it is cross-selling (sale of an additional application from
a second business line) or upselling (sale of a second application
within the same business line). Successfully penetrating a customer
account boosts its lifetime value and Quadient anticipates that
c.70% of the 2030 growth ambition will originate from its expansion
strategy.
This growth strategy is supported by global
capabilities at Company level, combining years of expertise
in R&D and innovation with an
integrated supply chain and support organization allowing for a
sustainable approach to product manufacturing and costs savings.
With over 550 engineers and developers and 6 R&D
centers worldwide, Quadient is well equipped to further
develop new innovative services and continue to improve its
existing applications. From a supply chain and support standpoint,
Quadient’s integrated approach optimizes logistics flows and
customer support functions by sharing these capabilities across the
Company and on a global scale.
Digital Quadient’s Digital
automation platform offers an array of high value cloud-based
software applications available through SaaS subscriptions. These
applications include customer journey mapping, invoice-to-cash,
procure-to-pay, communication management, document automation,
intelligent forms, and hybrid mail. They are delivered through an
integrated cloud platform featuring services such as a centralized
control panel, value-added services, add-on capabilities,
AI-powered digital interactions, and integrated support, also
enabling access to other applications. By addressing many business
pain points, Quadient’s digital automation offering brings
unquestionable customer benefits, from cost benefits to greater
convenience and strictest compliance.
In the core geographies where Quadient operates,
the addressable demand for its Digital automation platform is set
to grow from c.€6 billion in 2023 to c.€9 billion in 2027,
providing significant growth opportunities, both in communication
automation and financial automation. Particularly, Quadient is
uniquely positioned to drive compelling value from new regulatory
e-invoicing initiatives within the European Union. Quadient is
leveraging the innovation of its Digital automation platform and
building on the strong invoice generation, delivery and information
ingestion capabilities that already exist across its applications.
Managing e-invoicing is core to the Quadient
offering and common service delivered by the platform,
extensible to all Quadient Digital customers. In addition, Quadient
participates in several alliances that are working on defining the
standards for e-invoicing. This enables Quadient to remain an
active participant in this evolving field and adapt over time to
potential change, in order to continue to bring the best and most
efficient invoice-to-cash and procure-to-pay solutions to its
customers.
To capture this growth, Quadient will be relying
on an efficient go-to-market to solicit both new customers through
direct sales and partners, and existing mail customers through
cross-selling.
For the 2024-2026 period, Quadient provides an
indicative trajectory of c.10% organic CAGR in Digital
revenue and targets an EBITDA margin greater than
20% in 2026. Quadient’s 2030 ambition for its Digital
business is to reach more than €500 million in
revenue, with over 90% of subscription-related revenue,
and an EBITDA margin of c.30%.
Mail Quadient’s Mail automation
platform combines both hardware equipment (franking machines,
folder-inserters, letter openers, addressing systems, rating
scales) and its associated software and digital printing
functionalities. In most cases, the equipment is placed through
rental or leasing contracts. The highly automated services provided
by Quadient’s Mail automation platform deliver tangible customer
benefits, including labor cost savings associated with greater
efficiency, cost benefits generated by access to the best and most
accurate postage rates, higher convenience thanks to in-house mail
creation and better compliance with proof of mailing integrity,
audit trails and tracking.
Against the backdrop of a steady decline in mail
volumes, Quadient’s addressable demand for its Mail automation core
market segments should drop from c. €2.4 billion in 2023 to c. €2.0
billion in 2027. Quadient, however, believes that its Mail revenue
will continue to show resilience, declining only slowly and
gradually thanks to a continuous investment effort in innovation to
upgrade its offering and its ability to gain market share. Quadient
is also best positioned to support its customers with both
their digital mail and parcel automation needs through effective
cross-selling, allowing for an extension of the customer
relationship beyond mail and an increase in revenue per
customer.
Quadient’s indicative trajectory for the
2024-2026 period is of c.-3% organic CAGR in Mail
revenue and a targeted EBITDA margin greater than
25% in 2026. Quadient’s 2030 ambitions for Mail is to have
more c.€600 million in revenue, including
more than 65% subscription-related revenue, and an EBITDA
margin between 20% and 25%.
Lockers Quadient’s Lockers
automation platform provides a series of applications dedicated to
parcel pick up and returns. Parcel lockers and drop boxes are set
either indoors or outdoors, equipped with security cameras and
available on a 24/7 basis. Quadient’s Lockers automation platform
has two main categories: open network infrastructure and sales
& rentals of lockers for private use. Regarding open networks,
Quadient deploys and operates an infrastructure of lockers
in selected countries (France, Japan, the UK). This
infrastructure of lockers is used on a fee per parcel model by
large international and domestic carriers. Typical locations for
these parcel lockers include train stations, gas stations, car
parks or supermarkets. On the other hand, in the same countries as
well as in the United States, Quadient equips targeted verticals
including residences, universities, retailers and distributors with
parcel lockers for the specific needs of residents, students,
retail consumers and shoppers. Customer benefits range from reduced
delivery and collection costs to 24/7 availability, greater
convenience and experience, improved security of parcel delivery
and reduced CO2 emissions in city centers.
The expansion of e-commerce is the main driving
force supporting automated lockers’ demand growth. In the core
geographies where Quadient operates, the addressable market for its
Lockers automation platform is set to grow at a pace of over 10%
p.a. on average from c.€400m in 2023 to c.€600m in 2027. Together
with the rise in online retail, parcel volumes growth is also
boosted by the increase in the level of returns as well as the
growing C2C market. To capture this growth, Quadient is looking at
expanding its footprint, securing new sites to install more
lockers. Indeed, together with innovative features, density of the
lockers network to reach critical proximity is a key driver to
foster adoption and increase usage. Quadient also continues to
innovate, with services being added to its locker services such as
the award-winning drop box to consolidate returns.
For the 2024-2026 period, Quadient provides an
indicative trajectory of more than 10% organic CAGR in
Lockers revenue and targets an EBITDA margin
greater than 10% in 2026, with EBITDA breakeven point
being reached as soon as FY 2024. Quadient’s 2030 ambition for
Lockers is to reach an installed base of more than 40,000
lockers, more than €200 million in revenue, and an
EBITDA margin of c.20%.
Stronger ESG commitments
To fulfill Quadient’s long-term sustainable
growth ambition, the “Elevate to 2030” strategic plan includes
strong ESG commitments towards its
customers, its people and communities, and the
environment.
Towards its customers, Quadient aims at building
trust through market-leading applications, i.e. applications
helping customers to reduce the environmental impact of each
transaction and ensuring security and data protection. It also
involves relying on an ethical and responsible supply chain.
Targets set for 2026 include notably: 95% customer
satisfaction, life-cycle assessments covering 80% of the
applications portfolio, ISO 27001 certification extension from
Digital to Lockers R&D centers, 85% code of conduct endorsement
by strategic business partners, with 30% of them committed to
reduce their carbon footprint.
Towards its people and communities, Quadient
aims at providing its team with career opportunities based on a
competitive rewards program, assessing gender pay gap and adequate
wage, nurturing a diverse, equitable and inclusive workforce, and
forging meaningful partnerships that positively impact the
company’s communities. Targets set for 2026 include: 35% of
women representation within management, 75% inclusion
index score, and 5,000 volunteering hours dedicated to communities
every year by 2026.
Towards the environment, Quadient seeks to
reduce its impact on the planet with a climate strategy designed to
achieve zero carbon emissions by 2050, implying
the decarbonation of its applications all along their lifecycle as
well as responsible manufacturing and recycling. Targets set for
2026 include: at least 50% of placement of mail products
stemming from remanufacturing, and at least 90% of the
company’s industrial waste recycled. Regarding GHG emissions, the
scope 1 & 2 targets for 2030 were initially set at -50% vs.
2018; considering the -55% reached in 2023, Quadient is now
targeting -64% by 2030 in line with SBTi targets, with an
intermediary target of -59% set for 2026 (targets yet to be
approved by SBTi). The scope 3 target for 2030 remains at -30% vs
2018.
A strong investment
proposition
While further deploying cross-selling
opportunities and value-creation synergies across its businesses,
Quadient will continue to leverage its leadership positions.
Additional growth and higher profitability will stem from the solid
recurring revenue generated by its automation platforms and the
ability to drive innovative applications. Quadient is therefore
guiding for a greater than 1.5% organic revenue
CAGR over 2024-2026, and a twice-as-fast organic
current EBIT CAGR with a minimum of 3%
for the period 2024-2026. The 2024 financial guidance is confirmed
with organic growth expected at revenue and current EBIT
levels.
The dynamics at play within Quadient’s portfolio
of businesses, i.e. a double-digit growth in Digital and Lockers
revenues and an only moderate decline in Mail revenue will
mechanically generate a year after year acceleration in Quadient’s
total revenue growth.
Quadient’s ambitions for 2030
are to have more than €1.3 billion of total
revenue, including more than €1 billion of
subscription-related revenue (an increase of more than
€250 million vs. 2023), and a current EBIT of c.€250
million (an increase of c.€100 million vs. 2023).
In the meantime, Quadient will maintain a
disciplined capital allocation policy. Quadient’s strategic
approach will continue to be based on an ongoing assessment of its
invested capital to maximize long-term value for its
shareholders.
Capital expenditure (capex) is expected to
average at c. €100 million per year for the 2024-2026 period, to be
compared with an average of €93 million over the 2021-2023 period.
The slight increase will be due in part to Digital R&D
activities for its platform development and – to a higher extent –
to the deployment of the parcel lockers open network in the UK and
France. Mail capex is expected to remain stable and mostly linked
to new rented equipment.
In addition to organic investments, potential
opportunistic acquisitions may be considered to strengthen the
platforms, while Quadient will also continue to keep a flexible
approach to its portfolio.
Thanks to continuously strong and recurring free
cash-flow generation, Quadient aims at maintaining a healthy, yet
efficient balance sheet by bringing further down its net
debt excluding leasing/EBITDA excluding leasing ratio to 1.5x in
2026.
Finally, Quadient’s shareholder return policy
will continue to be based on a dividend pay-out ratio of
minimum 20% of net income while considering the use of
excess cash to perform share buybacks, subject to value-creation
criteria.
_________
To know more about Quadient’s news flow,
previous press releases are available on our website at the
following address: https://invest.quadient.com/en/newsroom.
Appendix
Digital: New name for Intelligent Communication
Automation
Mail: New name for Mail-Related Solutions
Lockers: New name for Parcel Locker Solutions
CONFERENCE CALL & WEBCAST
Quadient will host its
Capital Markets Day in Paris today at 9:00 am CET.
A livestream webcast
and a replay will be accessible at the following address:
Webcast
A replay of the
webcast will also be available on Quadient’s Investor Relations
website for 12 months.
Calendar
- 23 September
2024: H1 2024 results and Q2 2024 revenue
- 27 November
2024: Q3 2024 revenue
About Quadient®
Quadient is a global
automation platform provider powering secure and sustainable
business connections through digital and physical channels.
Quadient supports businesses of all sizes in their
digital transformation and growth journey,
unlocking operational efficiency and creating meaningful customer
experiences. Listed in compartment B of Euronext Paris (QDT)
and part of the CAC® Mid & Small and EnterNext® Tech 40
indices, Quadient shares are eligible for PEA-PME
investing.
For more information about Quadient, visit
https://invest.quadient.com/en/.
Contacts
Catherine Hubert-Dorel, Quadient+33 (0)1 45 36 30
56c.hubert-dorel@quadient.comfinancial-communication@quadient.com |
OPRG FinancialIsabelle Laurent / Fabrice Baron+33
(0)6 42 37 54 17 /+33 (0)6 14 08 29
81isabelle.laurent@omnicomprgroup.comfabrice.baron@
omnicomprgroup.com |
Caroline Baude, Quadient+33 (0)1 45 36 31
82c.baude@quadient.com |
|
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