(Oslo, 8 May 2013) EVRY ASA reports an EBITA margin of 4.5% for the first quarter of 2013, compared to 4.4% for the first quarter of 2012. Cash flow from operations improved significantly from NOK -120 million in the first quarter of 2012 to NOK 176 million in the first quarter of 2013.
Consolidated operating revenue for the first quarter of 2013 was NOK 3,144 million compared to NOK 3,328 million for the first quarter of 2012. This represents a decline in organic revenue of 6%, and revenue was affected by the factors that the company has previously communicated.
EVRY has more than offset the effect of lower revenue through strict cost control and reduced use of subcontractors, and reports an improved EBITA margin. The group's profit for the first quarter of 2013 was adversely affected by NOK 44 million relative to the first quarter of 2012 because in 2013 Easter was in first quarter.
In addition to the higher EBITA margin, EVRY reports an improvement in cash flow from operations from NOK -120 million in the first quarter of 2012 to NOK 176 million in the first quarter of 2013. Approximately NOK 146 million of the improvement can be related to the company's working capital project.
"We achieved a significant improvement in cash flow from operations in the first quarter of 2013. In addition, we increased our EBITA margin despite somewhat challenging market conditions, particularly in Sweden. The quality improvement programs underway in the bank and finance segment affected both CAPEX and operating costs in the first quarter of 2013. This work will continue in future quarters", comments Terje Mjoes, CEO of EVRY.
"We have the potential to improve profitability in line with the targets we have communicated. The new organisational structure in place from the start of the year provides the foundation for greater focus on developing our industry verticals, including accelerated Nordic expansion in the Financial Services area. Moreover, EVRY is building the best and most highly industrialised data centre ever seen in Norway - Future Proof. EVRY was successful in winning three of the four major contracts that have been due for renewal. The new contracts demonstrate that EVRY's new and state-of-the-art operating platform is in demand and competitive", explains Terje Mjoes, CEO of EVRY.
Key figures and main features of the first quarter of 2013
- Operating revenue of NOK 3,144 million (NOK 3,328 million in the first quarter of 2012)
- Consolidated operating profit before amortisation of intangible assets and before non-recurring items (EBITA) of NOK 142 million in the first quarter of 2013 (NOK 147 million in the first quarter of 2012)
- EBITA margin of 4.5% in the first quarter of 2013 (4.4% in the first quarter of 2012)
- EBIT in the first quarter of 2013 was NOK 123 million (NOK 152 million in the first quarter of 2012)
- Cash flow from operations of NOK 176 million (NOK -120 million in the first quarter of 2012)
- EPS NOK 0.24 in the first quarter of 2013 (NOK 0.25 in the first quarter of 2012)
First quarter 2013 figures for EVRY's business areas
The EVRY Financial Services segment reports operating revenue of NOK 831 million for the first quarter of 2013 as compared to NOK 845 million in the first quarter of 2012. The segment produced operating profit before intangible asset amortisation (EBITA) of NOK 56 million in the first quarter of 2013 compared to NOK 59 million in the first quarter of 2012. EBITA margin for the first quarter of 2013 was 6.8% compared to 6.9% in the first quarter of 2012.
The EVRY Sweden segment reports operating revenue of NOK 810 million for the first quarter of 2013 as compared to NOK 830 million in the first quarter of 2012. EVRY Sweden produced operating profit before intangible asset amortisation (EBITA) of NOK 46 million in the first quarter of 2013 compared to NOK 57 million in the first quarter of 2012.
The EVRY Norway segment reports operating revenue of NOK 1,608 million for the first quarter of 2013 as compared to NOK 1,744 million in the first quarter of 2012. EVRY Norway produced operating profit before intangible asset amortisation (EBITA) of NOK 75 million in the first quarter of 2013 compared to NOK 87 million in the first quarter of 2012.
Company outlook
EVRY has found that the Swedish IT services market in early 2013 is still affected by customers taking a cautious approach. This is particularly apparent for medium-sized export-oriented companies, which are holding back on their IT budgets until they see clear signs of an upturn. However, small and medium-sized customers are expected to generate a good level of activity and sound growth for outsourcing and operating services, both in Norway and in Sweden. EVRY anticipates that growth in demand for project work and consulting services in Norway will continue, but expects the conditions in the Swedish market to remain flat over the first half of 2013. The first quarter did show some signs of a recovery in optimism in Sweden, and an increase of 6% in the Swedish stock market in the first quarter demonstrates that the financial markets have an optimistic view of future prospects. Accordingly, we expect to see improvement in the Swedish market in the second half of 2013. This represents the same view of the outlook in Sweden as EVRY communicated in its interim report for the fourth quarter of 2012.
In the outsourcing market, EVRY's bids for the renewals of a number of major Norwegian customer contracts proved successful in the first quarter. The new contracts are based on solutions delivered through the Future Proof program, where standardisation, automation, and offshoring are key components. As previously communicated, the company does not expect any improvement in EBITA from its IT Operations service area in 2013 relative to 2012. This relates to the falling trend for revenue from the large customer segment of the Norwegian market (excluding the banking sector), together with the costs associated with essential investment in network upgrades to ensure better quality, and costs related to the Future Proof program. The positive trend in the SMB market in Sweden is set to continue, and a common feature for all new contracts is greater use of cloud-based technology to deliver better cost efficiency and improved flexibility for customers.
Contact names
Terje Mjoes, CEO, EVRY. Tel: + 47 06500
Eli Giske, CFO, EVRY. Tel: +47 908 44 189
Geir Remman, VP Corporate Communications, EVRY. Tel: + 47 970 55 017
About EVRY
EVRY (http://www.evry.com/) is one of the leading IT companies in the Nordic countries, with a strong local and regional presence in 50 Nordic towns and cities. Through its knowledge, solutions and technology (http://www.evry.com/it-services/), EVRY contributes to the development of the information society of the future, and so creates value for the benefit of its customers and for society as a whole. EVRY combines in-depth industry knowledge and technological expertise with a local delivery model and international strength.
EVRY has some 10,000 employees, and the company is committed to demonstrating that Nordic customers (http://www.evry.com/customers/'stay=1) are best served by a supplier that understands Nordic business from the inside. EVRY reports annual turnover approaching NOK 13 billion. The company is listed on the Oslo Stock Exchange and operates from headquarters in Oslo, with major activities in both the Norwegian and Swedish markets. www.evry.com (http://www.evry.com/)
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
1st quarter 2013 (http://hugin.info/194/R/1700234/561167.pdf)
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Source: EVRY via Thomson Reuters ONE
