Proact full-year results fall, partially offset by UK growth
The VAR aims to bring growth back through cost-cutting and leadership changes
Swedish reseller Proact has reported declining full-year figures, dragged down by weaker performance in its West and Central business units, despite strong momentum in the UK.
FY25 revenue dropped 3.8 per cent to SEK 4.7bn (£383.4m), down from SEK 4.9bn the year prior.
This was driven by a 5.1 per cent fall in system earnings, which represents around 55 per cent of Proact’s turnover, to SEK 2.5bn, due to lower sales across all regions.
The slowdown was also reflected in Q4, as top line decreased 6.8 per cent to SEK 665.8m.
Proact said this was partly due to several major deals in the comparison period in its Nordics & Baltics unit, while weaker market conditions and challenges within the sales organisation contributed negatively in both West and Central.
Service earnings, which includes support, managed cloud and consulting, landed at SEK 2.1bn, down from SEK 2.2bn the year before, a decline of 2.2 per cent.
In Q4, service top line dipped 1.9 per cent to SEK 541.3m, weighed down by weaker sales in West and Central.
This was partly offset by strong growth in support and cloud services in Nordic & Baltics, as well as increased service sales in the UK, mainly driven by the BlakYaks buyout.
Proact’s full-year adjusted EBITA stood at SEK 316m, down 9.9 per cent due to lower earnings, partially offset by the firm’s cost-efficiency programme.
Adjusted EBITA in Q4 reached SEK 84.9m, a 5.9 per cent rise, driven by lower selling and administrative expenses.
“The fourth quarter of 2025 marks the end of a year of change for Proact IT Group and my first year as president and CEO,” said Magnus Lönn.
“We have consistently focused on strengthening profitability across the business, while laying a solid foundation for profitable growth.
“Our services business - with support and cloud services at its core – showed good development in Nordic & Baltics and the UK, which partly offset weaker development in West and Central.
“This confirms the value of our long-term focus on recurring revenue and close customer relationships.”
UK and Nordics & Baltics lead the way, West and Central lag
The UK, which represents 15 per cent of Proact’s turnover, was its fastest-growing region, with revenue rising 7.3 per cent to SEK 760.8m.
This was reportedly driven by strong development in the services business, supported by the acquisition of BlakYaks earlier this year.
Organically, top line decreased by 0.7 per cent, dragged down by a 0.9 per cent fall in system revenue to SEK 328m and a ten per cent decline in support earnings.
However, service turnover jumped 14.5 per cent to SEK 432.8m.
Adjusted EBITA leapt 59.8 per cent to SEK 43.4m, reflecting higher service volumes. BlakYaks contributed SEK 29.9m during the year, despite a decline in the support business.
Nordics & Baltics, comprising Sweden, Norway, Denmark, Finland, Estonia, Latvia and the US, grew 4.4 per cent to SEK 2.6bn, driven by continued high demand in the systems business.
System revenue grew 4.2 per cent, while service sales increased 4.9 per cent, partially offset by a 14.2 per cent drop in consulting top line.
The firm also recently acquired Danish IT company Consular to boost its infrastructure and cloud offering in the Nordic region.
Nordics & Baltics represents 58 per cent of Proact’s total sales.
By contrast, revenue in West (Belgium and the Netherlands) decreased 15.4 per cent to SEK 717.9m, while turnover from the Central unit (Germany and Czechia) dropped 24.4 per cent to SEK 671.7m.
Both regions were impacted by a decline in systems and services sales.
“The development was mainly affected by weaker system sales and continued challenges in West and Central,” Lönn explained.
“At the same time, it is gratifying to see the development in the UK, where both the existing business and the acquired company BlakYaks contributed positively.”
Cost-efficiency programme and leadership changes
In order to reverse the trend in Central and West, Proact implemented a cost-efficiency programme earlier this year.
The scheme includes a review of the sales organisation, with the aim of better adapting its cost structure to current market conditions and creating more sustainable conditions for profitability.
The group has also reviewed its product portfolio and introduced measures to reduce its cost base and improve efficiency across the organisation.
The total cost of the programme amounted to approximately SEK 80m, of which SEK 54m was charged in Q4.
It is expected to generate cost reductions of around SEK 80m on a full-year basis, with full effect from mid-2026.
The programme has already reduced selling and administrative expenses by 6.7 per cent.
Proact has also reshuffled its leadership team over the past year.
In December, it appointed Åsa Regen Jansson as interim CFO.
That same month, it named Niklas Jakobsson as business unit director for Nordics & Baltics and promoted Jacob Kronborg to interim director of the Central business unit.
The CEO said the company intends to use this leadership team to develop its product portfolio and customer offering, particularly in West and Central.
“We need to improve a bit more in these regions before looking into further acquisitions in that area,” Lönn told CRN during an earnings call.
2026 outlook
Moving forward, Lönn said the group expects demand for its hybrid infrastructure and locally based data management services to remain strong, as European customers grow more cautious about relying too heavily on US cloud providers amid geopolitical uncertainty.
He added that while digitalisation, cloud migration and rising compliance requirements continue to support long-term demand, Proact is also operating in a more cost-conscious market, with longer decision-making cycles and greater pressure to demonstrate clear business value.
As a result, the company is prioritising profitability and customer relationships over chasing volume.
Looking ahead to 2026, Lönn said Proact will focus on driving profitable growth in its Nordic & Baltics and UK operations, while continuing its turnaround work in the Central and West regions.
He added that the company’s review of its product portfolio and customer offering will continue, with conclusions expected later this year.