Lectra tops half billion-euro revenue mark in 2022
Lectra, the French specialist in digital solutions and cutting equipment for industries using flexible materials has reported a revenue growth of 25%, to €521.9 million, for fiscal 2022, which closed on December 31. Lectra’s current EBITDA was up 51%, reaching €98.4 million, thanks to the acquisitions the company carried out in recent months, from its long-standing competitor Gerber to the Gemini CAD Systems, Neteven and Textile Genesis companies.
Lectra indicated that orders for perpetual software licenses, for equipment and their software and for non-recurring services were stable in 2022, and were worth €202.5 million.
Orders for non-perpetual subscriptions increased by 34%. Equipment sales instead slumped by 2%. “The economic situation has led many customers to modify certain purchasing terms,” said the company on Thursday February 9, on the occasion of the presentation of its results at its Paris headquarters.
Given the international context, the evolution of the “perpetual software licenses, equipment and their software and non-recurring services” business lines showed significant variations across different continents. Revenue in Europe fell by 4% to €57.2 million, while in Asia-Pacific it declined by 15% to €64.2 million. The Americas on the other hand grew by 16%, reaching a revenue of €61.5 million. In 2022, Europe accounted for a revenue share of 28% (down one percentage point), Asia-Pacific for a share of 32% (down five points), and the Americas for a 30% one (up four points). The rest of the world’s share was 10%.
As for revenue by sector, fashion was by far Lectra’s main industry, generating a revenue of €104.6 million, down 2%. The furniture sector’s revenue declined sharply by 31%, to €19.7 million. Instead, the revenue generated in the automotive sector increased by 36% in the year, reaching €56.7 million.
A three-year plan for 2023-2025
For fiscal 2023, Lectra is forecasting a revenue rise comprised between 2% and 12%, i.e. from €522 million to €576 million, stemming from the ongoing integration of the companies it has acquired. It is also targeting a current EBITDA ranging from €90 million (down 5%) to €113 million (up by 20%).
In the longer term, by 2025 the company intends to top the €700 million revenue mark, and increase the share of revenue it generates via its SaaS (software as a service) solutions to 10%, compared to 4% today. Lectra is also planning to increase its current EBITDA margin to more than 50% of revenue.
In this context, 2023 signals the opening of a new three-year strategic cycle for Lectra, during which it plans to consolidate the range of Industry 4.0 solutions in its portfolio. A range of services that was at the core of Lectra’s two most recent three-year plans, respectively from 2017 to 2019 and from 2020 to 2022. For the three-year period that has just started, Lectra will be focusing its efforts on six strategic priorities.
Lectra intends to forge ahead with the implementation of ethical, social, societal and environmental best practices, both within the company and for its clients. It also wants to take full advantage of the synergies derived from the Gerber group's acquisition, and accelerate the transition of its software business to a SaaS model. A third priority is to accelerate the transformation of its customer engagement and relationship model, and pursue external acquisitions.
10% of revenue for R&D
Another goal is to prepare for the 2026-2030 period. Lectra intends to invest 10% of its 2023-2025 revenue in researching and developing new solutions that will be available from 2026. Lectra’s fifth priority is phasing out a number of non-strategic activities, accounting for less than 5% of its revenue.
Finally, the group also indicated that it is preparing to gradually overhaul its governance. CEO Daniel Harari said he will remain in office at least until the end of 2025. “Thereafter, I will either stay on simply as president, or I will continue as CEO with the help of the executive committee for the group’s day-to-day running, so as to be able to focus on strategy and acquisitions,” he stated.
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