German politics impacted first-half revenue, said Allgeier (AEIX.N:GER), an IT staffing and services provider based in Munich, Germany. The company now expects to report €225 million in first-half revenue instead of the originally estimated more than €240 million.

An amendment to the Oline Access Act — the central law for the digitalisation of public administration — was locked in the Federal Council (Bundesrat) after being approved by the German Parliament (Bundestag) in February, according to the company. This delayed a large number of digitalisation projects at the federal state level that had been planned for in the first half of the year.

Allgeier reported an agreement was later reached in 2024 between the federal and state governments, and the act came into force on 24 July. The company now expects to see an increase in demand in the second half of this year, particularly within the public sector. Second-half sales are expected to be between €250 million and €260 million.

Second-half adjusted EBITDA is expected to be around €40 million, which includes a charge of around €2 million related to the delayed start of the Online Access Act. “Without this special charge, sales would also be around €10 million higher in the second half of the year and adjusted EBITDA would be expected to exceed €41 million,” according to the company. Adjusted EBITDA in the second half of 2023 was €37 million.

In addition, sales for full-year 2024 are expected to be between €475 million and €480 million. Adjusted EBITDA is expected to be around €63 million but would have been more than €69 million without the delay.

Allgeier expects full-year 2024 EBITDA of €68 million. The company noted two of its four founders left as minority shareholders with the remaining founders taking on their shares, which resulted in an adjusted shareholder agreement and an adjusted earn-out arrangement for the third quarter of 2024.

Allgeier will formally report earnings on 15 August.

Share Price

Shares in Allgeier closed down 1.83% on 7 August to €16.10. They were 10.27% above their 52-week low.