Vitec Software Group AB: Vitec Interim report January - June 2016
REVENUE GROWTH AND STRONGER CASH FLOW
SUMMARY FOR JANUARY - JUNE 2016
- Net sales SEK 318 M (296)
- Profit before tax SEK 40,5 M (43,8)
- Operating margin 13,6 % (15,8)
- Earnings per share before dilution SEK 1,08 (1,15)
- Cash flow from operations SEK 105,8 M (99,4)
SUMMARY FOR APRIL - JUNE 2016
- Net sales SEK 161 M (153)
- Profit before tax SEK 22,5 M (22,2)
- Operating margin 14,8 % (15,4)
- Earnings per share before dilution SEK 0,60 (0,57)
- Cash flow from operations SEK 21,8 M (25,8)
- New CEO of Business Area Finance & Insurance in Denmark
The second quarter lacks major events and the period's characteristic is daily work with deliveries, development, sales, and continuous strive for efficiency. Unrealized currency effects affected the operating profit negative with SEK 6 million for the first six months of 2016 compared with the same period last year, of which SEK 4 million refers to for the second quarter. The underlying business developed better than the marginal improvement in operating income in the second quarter.
The number of ongoing acquisition dialogues has increased during the latter part of the quarter, and we continue to devote significant resources in maintaining and further developing these dialogues. After the end of the period, this has resulted in the acquisition of the Finnish company Tietomitta OY. Vitec's financial position and readiness for future acquisitions is good, and with a prospect list of hundreds of companies in the Nordic region, we see good opportunities for further acquisition-based growth.
Vitec's business model with the pursuit of a high proportion of recurring revenues has received a downward adjustment in the quarter to 75.4 % (78.9 %) despite that recurring revenues has increased. The decrease is due to increased service revenues mainly in the business areas Real Estate and Auto. Auto operations in Denmark has a portfolio of services and Real Estate has a high number of rollout projects.
With a clear shift from traditional license sales to a subscription model (cloud-based systems), the proportion of recurring revenues and the operating margins increase at the same time. This, together with the employees' great capacity to innovate and integrate acquisitions, provides good conditions for long-term development of our business. With the acquisition of well-established companies and a high proportion of recurring revenues, Vitec con-tinues on this path, to act in several independent and specialized niches to achieve sustainable profitable growth.
Lars Stenlund, CEO
Vitec Software Group AB (publ.) is to make the above information public pursuant to the Swedish Securities Market Act or the Swedish Financial Instruments Trading Act. The information will be made public at 08:30 CET on Thursday, July 14, 2016.
Vitec Software Group AB (publ) is a Nordic software company that develops and delivers standardised software for industry specific needs. The Group has operations in Sweden, Denmark, Finland and Norway and grows in the mature part of the software industry by consolidating vertical software segments. Our customers include facility management companies, construction and real estate companies, banks and insurance companies, utilities and energy traders, healthcare companies, car spare part dealers and newspaper companies. The Group has 450 employees and had 2015 a turnover of SEK 618 million. Vitec is listed on Nasdaq Stockholm.Vitec Software Group AB (publ).
www.vitecsoftware.com Address: Tvistevägen 47 A, 907 29 Umeå, Sweden. Phone +46 90 15 49 00