Interim report 1-6/

Transcription

1 Interim report 1-6/

2 Forward-Looking Statements Certain sections of this presentation contain forward-looking statements based on the Affecto s current expectations, estimates, projections and assumptions. Words such as 'forecasts', estimates, expects, plans, and variations of these words and similar expressions are intended to identify forward-looking statements, which include, but are not limited to, Affecto's performance and profitability, market growth and industry developments. These statements involve certain risks and uncertainties, which are difficult to predict, and therefore actual future results and trends may differ materially from what is forecast in forward-looking statements. Affecto undertakes to update such statements with respect to new information and future events only within the limits of its statutory obligation to disclose information. 2

3 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Overview to Q2/ Net Sales (M ) Net sales 3.8 M (33. M ) - Decrease 7% - Weaker demand for traditional IT offering, more interest in new business technology solutions - Baltic net sales grew by 2 % Operational segment result 2.9 M (3. M ) - Excellent profitability 2 % in Baltic - Profitability 1 % in Finland, 8 % in Norway and 7 % in Sweden - Poor profitability -3 % in Denmark Operating profit 2.9 M / 9% (2.5 M / 7,5%) Operational segment result (M ) Operating profit (M ) 3 3

4 Income statement (1 EUR) 4-6/15 4-6/14 1-6/15 1-6/ Last 12m Net sales Other operating income Changes in inventories of finished goods and work in progress Materials and services Personnel expenses Other operating expenses Other depreciation and amortisation Operational segment result IFRS3 amortisation Goodwill impairment Operating profit/loss Net financial income/expenses Profit before income tax Income tax Profit for the period Basic EPS License sales halved compared to the second quarter 214. Utilization rate continued to be low in Denmark and Finland. Materials and services have decreased in line with decreased sales No IFRS3 amortisation, as that was completed in Q4/214 Net sales per region 1-6/215 Denmark 9 % Sweden 16 % Baltic 17 % Norway 18 % Finland 4 % 4

5 M M Segment comparison Net Sales By segment 4-6/15 4-6/14 Growth 214 Last 12m Finland % Norway % Sweden % Denmark % Baltic % Other Total % Net Sales Q2/14 Q2/15 Result By segment 4-6/15 Margin 4-6/14 Margin 214 Margin 5 Last 12m Margin Finland % % % % Norway % % % % Sweden % % 34 2 % % Denmark -8-3 % 26 8 % % 29 3 % Baltic % % % % Other Operational Segment % % % % Result IFRS3 amortisation Goodwill impairment Operating profit % % % % 1,6 1,4 1,2 1,,8,6,4,2, -,2 Operational Segment Result Q2/14 Q2/15

6 Business areas - Finland Net sales 12.4 M (13.8 M ), 1% decrease Operational segment result 1.3 M / 1%, (1.4 M / 1%) Low resource utilisation Lower net sales partially offset by expected lower incentives Order backlog is below last year Weaker demand for core offering, more interest in new business technology solutions Net Sales Q1/13Q2/13Q3/13Q4/13Q1/14Q2/14Q3/14Q4/14Q1/15Q2/15 Operational Segment Result Q1/13Q2/13Q3/13Q4/13Q1/14Q2/14Q3/14Q4/14Q1/15Q2/15 3, 2,5 2, 1,5 1,,5, 6

7 Development actions in Finland Especially the Finnish market is experiencing growing interest in new business technology areas and on the other hand declining trend in new orders related to traditional IT market. Therefore, in Finland we are investing in growth capabilities and culture, streamlining our operations and restructuring our organization and personnel structure to align with market demand. We are evaluating the need for personnel reductions in Finland combined with both organizational changes and ongoing competence development. These actions are estimated to reduce current personnel in Affecto Finland Oy and Karttakeskus Oy up to 5 employees. We are strongly following the group strategic direction published in February 215. We continue to invest and better answer to the needs of customers and the new technology areas. 7

8 Business areas - Norway Net sales 5.5 M (7. M ), 21% decrease Operational segment result.5 M / 8%, (.7 M / 1%) Lower number of employees partly offset by use of nearshoring Improved order intake Order backlog is above last year Net Sales Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/ Operational Segment Result Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 2, 1,5 1,,5, -,5-1, 8

9 Business areas - Sweden Net sales 5.5 M (5.5 M ), 1% increase Operational segment result.4 M / 7% (.3 M / 6%) Net sales increased due to a significant license deal Lower amount of employees and high people churn resulted to the lower consulting revenue Order backlog is below last year Search for the new country managing director and group leadership team member is also in process Net Sales Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Operational Segment Result Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/ , 1,5 1,,5, -,5-1, 9

10 Business areas - Denmark Net Sales Net sales 2.7 M (3.1 M ), 13% decrease Operational segment profit -.1 M / -3% (.3 M / 8%) Low utilisation and low license sales Significant business recovery actions ongoing Order intake continued to decline Order backlog below last year Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Operational Segment Result Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/ , 2,5 2, 1,5 1,,5, 1

11 Business areas - Baltic Net Sales Net sales 5.6 M (4.7 M ), 2% increase Operational segment result 1.1 M / 2% (.6 M / 13%) Insurance business and Estonia performing well High utilization due to the few large projects in final stages Slow preparation of new EU funded projects still negatively impacts the public sector market in Lithuania Order backlog is below last year Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Operational Segment Result Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 2, 1,5 1,,5, -,5-1, 11

12 Balance sheet (1 EUR) 6/215 6/214 12/214 Property, plant and equipment Goodwill Other intangible assets Other long-term assets Long-term assets Receivables and inventories Cash and cash equivalents Current assets Total assets Equity for shareholders Non-current liabilities Current liabilities IFRS3 amortisation has been completed Interest-bearing net debt 3.3 M (1.1 M 12/214) Gearing 5% (2%) Equity ratio 58% (55%) Increase in current liabilities based on the current terms according to which the loan from financial institutions will be due in June 216 Total equity and liabilities

13 Cash flow (1 EUR) 1-6/ / Cash flows from operating activities Profit for the period Adjustments to profit for the period Change in working capital Interest and other financial cost paid Interest and other financial income received Income taxes paid Net cash from operating activities Change in working capital more positive than year ago Net cash used in investing activities Net cash from financing activities Decrease/(increase) in cash and cash equivalents

14 Ownership structure 27 July 215 Registered owners % Cantell Oy 1,2 % Lombard International Assurance S.A. 6,5 % Danske Suomi Kasvuosake Fund 6,4 % Säästöpankki Kotimaa Fund 5,8 % Evli Suomi Fund 4,9 % OP-Suomi Pienyhtiöt Fund 4,8 % Ilmarinen Mutual Pension 4, % OP-Suomi Arvo Fund 3,4 % Taaleritehdas Arvo Markka Fund 2,7 % State Pension Fund 2,7 % Other shareholders 44,8 % Flagging notices in None Treasury shares 3.9% 22.5 million shares in total Treasury shares 3,9 % Total 1, % 14

15 Dividend ( /share) Annual General Meeting - 8 April 215 Dividend:.16 eur/share - Last year.16 eur/share,2,16,12 Board members: - Existing board members re-elected: Aaro Cantell, Jukka Ruuska, Tuija Soanjärvi, Lars Wahlström, Magdalena Persson, Olof Sand,8,4, Other issues - Board fees: chairman 35 /month, vice chair 275 /month, member 2 /month. To be partially paid with shares - Same authorizations as last year - Nominations committee for board member selection 15

16 Changes in Management Julius Manni started as the country managing director for Finland on 1 March 215. Hellen Wohlin Lidgard, the country managing director for Sweden and Rene Lykkeskov, the chief strategy officer, left Affecto during second quarter. Mikko Eerola has been appointed as managing director, B2C and Customer Front-Office Reinvention and the member of the group management team. Eerola will lead Affecto s business technology and design services in these growing areas and he will start on 1 August 215. CFO Satu Kankare has decided to resign and she will leave Affecto on 7 August 215. Sami Lehtinen will be the interim CFO and will serve in the position during the CFO recruitment process. Sakari Knuutti started as the Director, Legal & IR on 27 July

17 Outlook

18 Business development actions Good progress in converting the strategic direction into operational changes Positive feedback on increased focus on industry knowledge and value in customer work Capability development on several fronts: - Evolution meeting practise with employees - Recruitment to new hybrid roles both from inside and outside Affecto - Affecto Industrial program with focus on IoT & analytics for selected industries - Design / user interface / usability solutions - Near-shore capability development boost 18

19 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Outlook Order backlog 43 M, 4.8 M below Q2/214 Order backlog (M ) Order backlog (M ) Q1 Q2 Q3 Q Year 215 net sales are estimated to be below last year s level. Operating profit is estimated to grow in

20 2 Thank you.