STOCKHOLM, Sweden, Aug. 14, 2002 (PRIMEZONE) -- Cyber Com Consulting Group Scandinavia AB (publ) Corporate registration number 556544-6522:
- Sales reached SEK 188.2 million.
- Operating income before goodwill reached SEK 3 million or 1,6%.
- A positive SEK 15 million cash flow was booked; liquidity
increased to SEK 135.8 million.
- The operating margin for all of 2002 is expected to dip below
or to stay at the same level as in 2001.
- New, larger assignments came in from Sony Ericsson and ASSA
ABLOY.
- The company signed master agreements with Alecta and
AstraZeneca.
Sales and profit
Amounts in million SEK Jan.- Jan.- Apr.- Apr.- Jul. Jan.-
(MSEK) Jun. Jun. Jun. Jun. 2001 Dec.
2002 2001 2002 2001 -Jun. 2001
2002
Sales 188.2 211.9 85.4 103.0 372.5 396.2
Operating expense excl. -185.0 -198.7 -89.7 -100.8 -361.7 -375.2
goodwill amortisation
Operating income before 3,0 13.2 -4.3 2.2 10.8 21.0
goodwill amortisation
Margin % 1.6% 6.2% -5.0% 2.1% 2.9% 5.3%
Goodwill amortisation -6.5 -5.5 -3.2 -2.7 -10.1 -8.9
Operating income after -3.5 7.7 -7.5 -0.5 0.8 12.1
goodwill amortisation
Operating margin % -1.9% 3.6% -8.8% -0.6% 0.2% 3.1%
The first half of 2002 (H1 2002)
Recession and a generally tough market situation characterised H1 2002. Utilisation was unsatisfactory during Q2. The Telecom & Services, E- business, and International business areas were affected to different degrees. The operation in Sweden was restructured to meet changed market demands for solutions at a cost of SEK 2.6 million during the period.
At the period's end, the number of new assignments started to increase.
Sales for H1 2002 reached SEK 188.2 million (211.9), which is 11.2% lower than the same period in 2001. Operating income before goodwill amortisation was SEK 3 million (13.2), which yields a 1.6% margin (6.2%). Operating income after goodwill amortisation was SEK -3.5 million (7.7), which yields a -1.9% operating margin (3.6%).
H1 2002 net financial items totalled SEK 2.3 million (-2.8). Thanks to strong liquid assets, the company could book SEK 2.2 million in positive net interest income. Loss after net financial items was SEK -1.2 million (4.9), which yields a -0.7% net margin (2.3%).
The company had SEK 15 million (21) in positive cash flow from operations in H1 2002, so liquid assets increased and at the period's end, they were worth SEK 135.8 million (112.5).
The second quarter of 2002 (Q2 2002)
Q2 2002 sales reached SEK 85.4 million (103 million in Q2 2001). Operating income before goodwill amortisation was SEK -4.3 million (2.2) or -5.0% (2.1%). Goodwill amortisation reached SEK 3.2 million, so operating income was SEK -7.5 million. The operating margin was -8.8% (- 0.6%).
Q2 2002 net financial items totalled SEK 1.2 million (-4.2). Loss after net financial items was SEK -6.3 million (-4.7), which yields a -7.4% net margin (-4.6%).
The company experienced an SEK -12.1 million negative cash flow (-4.5). Its liquid assets totalled SEK 135.8 million.
International - new business area (BA)
During Q1 2002, the 18 March extraordinary general meeting approved acquisition of Stratum Project Management Ltd, a UK consulting company (now Cyber Com Stratum Consulting Ltd). As a result of the acquisition, the company decided to build the new International business area (BA). This BA covers Cyber Com's operations in Denmark and the UK. All comparable figures for the previous year were adjusted, so Denmark's financial results were eliminated from the Telecom & Services BA.
Telecom & Services BA
Telecom & Services Jan.- Jan.- Apr.- Apr.- Jul. Jan.-
Jun. Jun. Jun. Jun. 2001 Dec.
Amounts in MSEK 2002 2001 2002 2001 -Jun. 2001
2002
Sales 110.2 138.3 48.5 69.7 236.4 264.5
Operating income before 6.3 19.0 0.0 6.5 20.7 33.4
goodwill amortisation
Margin % 5.7% 13.7% 0.0% 9.3% 8.8% 12.6%
Ave. no. employees 126 138 126 141 134 133
The first half of 2002 (H1 2002)
H1 2002 sales reached SEK 110.2 million (138.3), which is a 20.2% reduction compared to the same period in 2001.
Operating income before goodwill amortisation was SEK 6.3 million (19), which yields a 5.7% margin (13.7%). Goodwill amortisation was SEK 5 million (5.5), so operating income after goodwill amortisation was SEK 1.3 million (13.5) or 1.2% (9.8%).
During Q1, Cyber Com was named an Ericsson preferred supplier.
The second quarter of 2002 (Q2 2002)
Recession, long sales cycles, and increased competition affected the Telecom & Services BA. Operations have been restructured to meet changed market demands for solutions; this cost SEK 1.1 million during the period.
Q2 2002 sales reached SEK 48.5 million (69.7), a 30.4% reduction compared to the same period in 2001.
Operating income before goodwill amortisation was SEK 0 million (6.5), which yields a 0% (9.3%) margin. Goodwill amortisation was SEK 2.5 million (2.8), so operating loss was SEK -2.5 million (3.7) or -5.2% (5.3%).
In H1 2002, the company signed a long-term contract with Sony Ericsson. And the BA's customer base was broadened to include high-tech companies - thanks to new orders from Sony Ericsson (product development), Bombardier, and Micronic.
Sony Ericsson gave Cyber Com responsibility for its consumer Web sites, which is a collective name for Sony Ericsson's many Web sites for the consumer market. The contract covers 12 months and is initially worth SEK 15 million.
The BA's Q2 utilisation reached 64% (83%). Restructure of operations and cost cutting somewhat compensated for lower utilisation.
The number of employees during Q2 did not change from Q1; the BA employed 126 persons at the period's end - a 15-person, 10% reduction of the average number of employees, compared to the same period in 2001.
E-business BA
E-business Jan.- Jan.- Apr.- Apr.- Jul. Jan.-
Jun. Jun. Jun. Jun. 2001 Dec.
Amounts in MSEK 2002 2001 2002 2001 -Jun. 2001
2002
Sales 58.2 84.1 25.5 39.6 130.4 156.3
Operating income before -7.7 0.4 -6.1 -2.6 -8.1 0.0
goodwill amortisation
Margin % -13.2% 0.5% -23.9% -6.6% -6.2% 0.0%
Ave. no. of employees 119 144 119 147 133 143
The first half of 2002 (H1 2002)
The BA's H1 sales reached SEK 58.2 million (84.1), a 30.8% reduction compared to the same period in 2001. Operating income before goodwill amortisation was SEK -7.7 million (0.4).
During Q1, Cyber Com signed a master agreement with the Tetra Laval.
The second quarter of 2002 (Q2 2002)
The tough market situation affected the E-business BA to a higher degree than the Telecom & Services BA. Operations were restructured to meet changed market demands for solutions; this cost SEK 1.5 million during the period.
Q2 sales reached SEK 25.5 million (39.6), a 35.6% reduction compared to the same period in 2001.
Operating income before goodwill amortisation was SEK -6.1 million (-2.6), which yields a -23.9% operating margin (-6.6%).
Cyber Com's focus on the insurance market was strengthened through several assignments within private life insurance as well as employee pensions.
Several new customers were acquired during the period (e.g., DeLaval Holding in Stockholm, a Tetra Laval subsidiary). At the period's end, Cyber Com started an internal purchasing system (e-procurement) project with ASSA ABLOY; the initial order is worth SEK 3 million.
Cyber Com signed new master agreements with:
-- Alecta (for consulting services from Q2 2002 to year-end 2003)
-- AstraZeneca (two-year contract); here, Cyber Com was named a
preferred partner. The AstraZeneca contract covers BAs within
AstraZeneca's Swedish operation and possibly in the U.K.
Q2 utilisation was 52% (74%). The average hourly rate increased somewhat during the quarter.
The number of employees during Q2 is unchanged from Q1 and was 119 persons at the period's end, which is a 28-person, 19% reduction of the average number of employees, compared to the same period in 2001.
International BA
Cyber Com has had this new BA since Q1 2002. The BA includes operations at Cyber Com Danmark A/S (Denmark) and Cyber Com Stratum Consulting (UK).
International Jan.- Jan.- Apr.- Apr.- Jul. Jan.-
Jun. Jun. Jun. Jun. 2001 Dec.
Amounts in MSEK 2002 2001 2002 2001 -Jun. 2001
2002
Sales 35.0 0.1 17.5 0.1 37.3 2.4
Operating income before 4.6 -1.5 1.6 -1.5 0.9 -5.2
goodwill amortisation
Margin % 13.1% NA 9.1% NA 2.4% NA
Ave. no. of employees 37 5 37 5 22 8
The first half of 2002 (H1 2002)
The BA's H1 sales reached SEK 35 million (0.1). Operating income before goodwill amortisation was SEK 4.6 million (-1.5), which yields a 13.1% operating margin.
The second quarter of 2002 (Q2 2002)
Right now, recession (although not as severe as in Sweden) affects the market climate in Denmark and the U.K.
The BA's Q2 sales reached SEK 17.5 million (0.1). Operating income before goodwill amortisation was SEK 1.6 million (-1.5), which yields a 9.1% operating margin. The average hourly rate was somewhat reduced compared to Q1.
During Q1 2002, Cyber Com acquired Stratum Project Management, a U.K. consulting company that primarily targets the banking and finance and telecom segments. Major customers are Reuters and the Royal Bank of Scotland. Like Cyber Com, the company has demonstrated profitability since its start in 1995. Right now, the U.K. market is also tough, but so far it has not affected the company, which continues to demonstrate good utilisation and margins. Consulting fees are higher in U.K., compared to Sweden.
Cyber Com's operation in Denmark is developing according to plan, and shows a loss for the period, which is in agreement with the budget. Business conditions have improved thanks to new assignments from existing customers that operate within mainly telecom and finance. It is expected to achieve profitability for the July-September 2002 period. Cyber Com Danmark A/S continues to recruit. At the period's end, the company employed 15 people.
The average number of employees during Q2 increased from 35 to 37 persons. At the period's end, the International BA had 38 employees.
Personnel
During Q2 2002, the average number of employees in the group was 304. At the quarter's end, the average number of employees in the group was 307, a net reduction of 13 persons compared to Q2 2001.
Investments
For H1 2002, investments in tangible fixed assets reached SEK 1.4 million (4.8). Investments in intangible fixed assets totalled SEK 29 million (32.1).
Cash flow
As of 30 June 2002, the group's liquid assets totalled SEK 135.8 million, compared to SEK 120.8 million on 31 December 2001, that is, a positive SEK 15 million cash flow. SEK 17.8 million of the liquid assets are deposited as security for loan notes issued in connection with acquisition of Stratum in the UK.
Financial position
On 30 June 2002, equity totalled SEK 236.4 million (223.5 on 31 December 2001), which yields a 71.5% (72.2%) equity/assets ratio. Shareholders' equity per share reached SEK 22.57 (23.82) with full dilution.
The parent company
The parent company's operation primarily consists of support functions such as finance, administration, PR & communications, and IS/IT. At the period's end, the parent company employed 28 (28) persons.
H1 2002 sales reached SEK 17 million (17.5). Operating expense totalled SEK -0.3 million (-5.1). Loss after financial items was SEK -3.5 million (-2.3), which means a write-down of shares in the subsidiaries because during Q1, Cyber Com Consulting A/S in Denmark received a shareholders' contribution of SEK 5.1 million, to cover loss in 2001.
On 30 June 2002, the parent company's liquid assets totalled SEK 81.9 million (49.8). SEK 17.8 million of the liquid assets are deposited as security for loan notes issued in connection with acquisition of Stratum.
Investments in computers and other equipment totalled SEK 0.3 million (0.5).
Warrant programme
The 11 January 2002 extraordinary general meeting decided to take out a new subordinated loan, worth at most SEK 10,000, through issue of a subordinated debenture with at most 500,000 detachable warrant rights to subscribe to shares.
Outlook
For the rest of 2002, we expect that the market will continue to be turbulent and hard to predict. During 2001 and H1 2002, Cyber Com worked on adapting its service offerings and organisation to the market. The operation increasingly focuses on solutions. During H2 2002, this adaptation is starting to show results. The company expects the operating margin for all of 2002 to dip below or to stay at the same level as in 2001.
Forthcoming reports:
Q3 2002, Wednesday, 16 October 2002 2002 year-end financial report, February 2003
Accounting principles
The company applies the same accounting principles as for the previous year.
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