The year of sowing the seeds and sprouting the new greenish crop of
international growth – focusing on omnichannel and digital commerce continues
Brief look at January – September 2016
- Revenue totalled 45,3 million euros (33,9 million euros)
- Operating profit was 5.742 thousand euros (1.058 thousand euros). The impact
of the business divested in the first quarter on the operating result was –212
thousand euros.
- Adjusted operating profit was 2.209 thousand euros (1.847 thousand euros).
- Solteq Group’s equity ratio was 32.4 % (27.1 %).
- Earnings per share was 0.26 euros (0,03 euros).
- In the review period, Solteq published the new strategy, in which the key
elements are digital commerce, growth and internationalization.
- As part of its strategic focus on multi-channel and digital commerce, Solteq
decided to sell its subsidiary MainIoT Software Oy, which supplied service and
maintenance systems, in the first quarter of the year. In the third quarter of
the year, it decided to establish a dedicated omnicommerce competence centre of
excellence that would serve Nordic retailers.
- During the third quarter of the year we won many new customer projects in
Finland as well as internationally.
After the review period, at the same time with the interim report, we published
that we have acquired the entire share capital of Swedish Aponsa AB. The
acquisition executes the strategy focusing on digital commerce and international
growth. A separate stock exchange bulletin on the acquisition has been published
on 25 October 2016. Related to another discontinued acquisition an adjustment
item totaling to 503 thousand euros is recognized during the review period.
Key figures and ratios
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
| |7-9 /|7-9 /|Change|1-9 /|1-9 /|Change|1-12/|Rolling|
| | 2016| 2015| -%| 2016| 2015| -%| 2015| 12 m|
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Revenue, EUR million | 13,6| 14,9|-8,9 %| 45,3| 33,9|33,9 %| 54,2| 65,7|
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Adjusted operating | 0,6| 0,7| -17,2| 2,2| 1,8|19,6 %| 3,0| 3,4|
|profit, EUR million | | | %| | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Operating profit, EUR| 0,0| -0,1|-111,5| 5,7| 1,1| 442,7| 1,3| 6,0|
|million | | | %| | | %| | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Profit for the | -0,5| -0,4| 9,7 %| 4,4| 0,4| 900,9| 0,1| 4,1|
|financial period, EUR| | | | | | %| | |
|million | | | | | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Earnings/share, eur |-0,03|-0,03| 0,0 %| 0,26| 0,03| 766,7| 0,01| 0,25|
| | | | | | | %| | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Operating profit -% |0,1 %| -0,4| | 12,7|3,1 %| |2,4 %| 9,1 %|
| | | %| | %| | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Adjusted operating |4,4 %|4,9 %| |4,9 %|5,5 %| |5,5 %| 5,1 %|
|profit -% | | | | | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Equity ratio, % | 32,4| 27,1| | 32,4| 27,1| | 24,4| 32,4 %|
| | %| %| | %| %| | %| |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
Repe Harmanen, CEO of Solteq: Strategic actions, new projects and focus on the
final spurt towards the end of the year
During the third quarter of the year, we won several new client projects. We
have released information on some of them, but the contractual extent of others
has not reached the limit set in our stock exchange release policy. At the
review period level, our revenue grew as expected, and our operative
profitability improved. The slight decline in the revenue for the third quarter
was partly due to the changes that took place in the operating environments of
some of our long-term clients, but the rationalisation programmes and more
flexible cost structures have maintained and improved relative profitability.
The key elements of our strategy are digital commerce, growth and
internationalisation. In the Nordic countries, we will focus on solutions for
chain-based and digital commerce. Globally, digital commerce solutions will be
in the core of our strategy. In Finland, we will mainly grow organically, but in
the Nordic countries and globally, we also aim at being active in mergers and
acquisitions to implement our strategy.
From strategic point of view, our most significant client project was the
framework agreement with the Musti ja Mirri Group Oy concerning the delivery of
a retail business solution to the Finnish, Swedish and Norwegian markets that we
published in the review period. This is an excellent example of the
implementation of our strategy and its goals. We will continue this work
systematically and strengthen these areas both geographically and operationally.
At the same time, we have also started collaboration with a few new digital
commerce clients in Europe.
At the end of the past quarter, a total of about 10 new top experts joined
Solteq and started to work in our key business areas in Finland, Sweden and
Poland. During the last few months of the year, we will continue recruiting in
these areas. The establishment and the expansion of the Magento Omnicommerce
Competence Center, which we published some time ago, will also increase the
number of employees both in Finland and abroad.
A significant factor related to the third quarter is a non-recurring cost item
for a company acquisition project. However, we decided to discontinue the
process due to the risks involved. The risk of a negative development was also
too high in terms of the owner value. At the same time with this interim report
we published a release of another, successful company acquisition.
The last quarter of the year will be full of activity, and our aim is to
successfully complete several concurrent digital commerce projects with our
clients. During the last few months of the year, we will continue our
investments in strategic areas in Finland, Sweden and Poland. In this way, we
will create growth for years to come.
We will maintain our earlier profit guidance concerning the revenue and
operating profit for 2016.
Guidance on Group outlook
Solteq Group’s revenue is expected to grow significantly compared to financial
year 2015. The operating profit and the adjusted operating profit are expected
to grow compared to financial year 2015 as well.
The expected growth of revenue and operating profit is mainly related to the M&A
activity completed during the previous financial year and during the review
period. In addition, the cost synergies arising from the M&A activity are
expected to be realized mainly during the year 2016.
Online-briefing for investors and media October 25th, 2016
The media and investor briefing for the announcement of financial performance of
the first three quarters of 2016 will be broadcasted on Periscope October 25th,
2016 at 13.00 on channel @SolteqTweets. The briefing will be recorded and can be
accessed on the Solteq’s website later on the same day.
The online-briefing will also be broadcasted at the same time at Solteq Facebook
as live-video.
Briefing for investors and media November 16th, 2016
The media and investors are welcome to participate in a briefing on Wednesday,
November 16th at 8.30 at Allas SeaPool in Helsinki. The briefing focuses on
digital commerce and Solteq strategy. For additional information please see
https://www.solteq.com/en/investors/investor-relations/ir-calendar/
Further information
Repe Harmanen, CEO
tel. +358 400 467 717
e-mail repe.harmanen@solteq.com
Antti Kärkkäinen, CFO
tel. +358 40 8444 393
e-mail antti.karkkainen@solteq.com
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
www.solteq.com
Solteq in brief
Solteq is an expert in digital commerce. We deliver comprehensive solutions for
digital commerce under one roof: from back-office processes to customer
experience – from supply chain management to online marketing. We have the
passion to deliver the unexpected – in a fast-changing world our customers need
a partner who can deliver today what they need tomorrow. We employ ca. 500
experts in three different countries and we make deliveries to Europe, North
America, Asia and Australia.
