Solteq Plc Stock Exchange Bulletin 24.4.2013 at 9.00 am
- Solteq Plc’s turnover increased 12.9 per cent and totalled 10.0 million euros (8.8 million euros).
- Solteq Plc’s operating profit totalled 544 thousand euros (949 thousand euros). The operating profit for the collation period includes a total of 276 thousand EUR of one-time profit and expenses as gross.
- For 2013, we estimate our turnover to be approx. 40-43 million EUR the level of EBIT approx. 6-9 %.
- Earnings per share were 0.03 euros (0.04 euros).
| KEY FIGURES | |||
| Turnover by operation: | |||
| % | 1-3/13 | 1-3/12 | 1-12/12 |
| Softwareservices | 67 | 64 | 61 |
| Licences | 27 | 31 | 32 |
| Hardware | 6 | 5 | 7 |
CEO Repe Harmanen:
“In the first quarter, our growth continued at the same level as last year. On-going projects proceeded as planned and several new solutions were delivered to serve our clients.
We fell slightly behind the comparable performance target before non-recurring items but we will continue taking systematic measures to reach the target performance level.
The growth in the turnover continued in some of our units, but our emphasis continues to be on overall profit making ability. We are pleased to be able to state that the business areas in which we have faced challenges before are now on a good growth and performance path. Preparation for the large projects which will be completed later this year has, however, impacted our profitability in the first quarter.
There have been no major changes in the demand for solutions in the sectors that are important to us, but we are monitoring the situation to be able to react to possible changes. The prevailing uncertainty in the economy and consumption seems to delay decisions to launch large new projects. During the review period, we also encountered a few cases like this.
During the first quarter, we continued the implementation of our strategy. This year, we will also review the strategy period ending in 2014 and estimate possible improvement needs. We will report on this process separately during the course of this year.
In the second quarter, we will continue our measures to make us increasingly more flexible and better prepared for possible changes in the market situation.”
BUSINESS ENVIRONMENT AND BUSINESS DEVELOPMENT
Solteq is a leading retail and service industry software service company. We offer long-term partnership and the markets' widest range of retail and service industry software services, from the optimisation of the entire supply chain to the management of consumer-customer information. Our technology-independent solutions help our customers to guide their business operations as efficiently and profitably as possible.
Solteq Plc's reported segments are Grocery and special retail, HoReCa; Wholesale trade, Logistics and Services and Service Business and Maintenance Management.
The aim of the segmentation is to respond to customer demand as a field total supplier and therefore to improve the availability of services and ease for our customers.
Solteq's turnover in the first quarter of was 9.987 thousand euros (8.849 thousand euros).
Solteq's operating profit was 544 thousand euros (949 thousand euros). The operating profit for the collation period includes a total of 276 thousand EUR of one-time profit and expenses as gross.
The company's operating margin was 5.5 % (10.7 % in 2012, cleared from one-time profit and expenses 7.6 %).
Grocery and Special Retail, HoReCa
Solteq’s Grocery and Special Retail Segment provides its clients with total solutions that they can utilise to improve efficiency in terms of logistics, store operations, customer service, point of sale operations, as well as loyal customer management.
The grocery and special retail solutions help optimise the management of the product selection, space, deliveries, logistics and customer satisfaction while increasing sales and improving the result. The solutions speed up the basic operations, improve delivery reliability, reduce storage value, increase stock turnover and enhance predictability. The store always has the right products in the right place, at the right time, and at the right price.
During the review period the revenue of the Grocery and Special Retail segment totalled 4.7 million euros and the operating result was 0.6 million euros.
Wholesale Trade, Logistics and Services
Solteq’s Wholesale Trade, Logistics and Services Segment provides its clients with ERP and financial management systems, as well as optimisation, integration and reporting solutions that support these systems.
Solteq’s solutions help clients manage their operations and enhance purchases, sales, stock management and reporting. The systems can be utilised to improve delivery reliability, reduce storage value, increase stock turnover and enhance predictability. Materials flow management ensures that the right goods reach the right customers at the right time, packed in an optimal manner.
Solteq’s wholesale trade, logistics and services systems improve the effectiveness of operations and enable more flexible and versatile customer service. At the same time, automated data management enhances the company’s internal operations. Solteq’s solutions are used daily by a large number of clients representing various industries and sectors, such as wholesale, retail and public administration.
During the review period the revenue of the Wholesale Trade, Logistics and Services segment totalled 3.9 million euros and the operating result was -0.2 million euros.
Service Business and Maintenance Management
Solteq’s Service Business and Maintenance Management Segment provides its clients with ERP and master data management solutions.
The enterprise resource planning solutions developed for the optimisation of service processes help clients manage their operations in many ways, for instance enhance production plant reliability, task and resources management, field work, sales and customer service, partner network management and materials management. The solutions are utilised by a large number of clients representing various industries and sectors, such as energy production, maintenance services, life cycle services, engineering and technical services of cities and municipalities, property management services, and home and care services.
The Service Business and Maintenance Management Segment also provides client companies with services and products related to business critical data (master data) in the form of master data improvement projects, data maintenance services outsourced to master data service centres, software technologies for master data management, and consultation services. The aim of these services is to ensure that the data in the systems that support the clients’ enterprise resource planning and decision making processes are of high quality, compatible and up-to-date. Solteq’s master data management solutions are used by clients across industries and sectors.
During the review period the revenue of the Enterprise resource planning of services segment totalled 1.4 million euros and the operating result was 0.2 million euros.
TURNOVER AND RESULT
Turnover increased by 12.9 % compared to the previous year and totalled 9.987 thousand euros (previous review period 8.849 thousand euros).
Turnover consists of several individual clienteles. At the most, one client corresponds to less than ten per cent of the turnover.
The profit for the review period was 544 thousand euros (949 thousand euros), the operating profit before taxes was 481 thousand euros (837 thousand euros) and the operating profit for the review period was 360 thousand euros (493 thousand euros).
BALANCE SHEET AND FINANCING
The total assets amounted to 27.522 thousand euros (26.760 thousand euros). Liquid assets totalled 2.169 thousand euros (1.455 thousand euros). In addition to liquid assets the company had unused account limits totalling 1.500 thousand euros at the end of the review period. Solteq Group’s interest-bearing liabilities were 6.333 thousand euros (7.175 thousand euros).
Solteq Group’s equity ratio was 35.9 per cent (35.5 per cent).
INVESTMENTS, RESEARCH AND DEVELOPMENT
Net investment during the review period was 420 thousand euros (6.891 thousand euros).
Research and development
Solteq’s research and development costs consist mainly of personnel costs. When developing basic products, it is Solteq’s strategy to cooperate with global actors such as SAP, Symphony EYC and Microsoft and utilize their resources and distribution channels. Own development efforts are focused on added value products and developing tailored service concepts.
During the review period product development costs were not amortized in accordance with IFRS standards (none in the reference year, either).
PERSONNEL
The number of permanent employees at the end of the review period was 290 (288). The average number of personnel during the review period was 289 (218). In the end of the review period the number of personnel could be divided as follows: Grocery and special retail, HoReCa segment: 103 people; Wholesale trade, Logistics and Services: 95 people; Service Business and Maintenance Management segment: 40 people and 52 people in shared functions.
RELATED PARTY TRANSACTIONS
Solteq's related parties include the board of directors, managing director and
the management team. There has not been any significant changes related parties after the 2012 year end closing.
SHARES, SHAREHOLDERS AND TREASURY SHARES
Solteq Plc’s equity on 31.3.2013 was 1.009.154,17 euros which was represented by 14.998.061 shares. The shares have no nominal value.
At the end of the review period, the amount of treasury shares in Solteq Plc and the group companies Solteq Management Oy’s and Solteq Management Team Oy’s possessions were 773.404 shares. The amount of treasury shares represented 5.2 % of the total amount of shares and votes at the end of the review period. The equivalent value of acquired shares was 52.039 euros.
After the review period, 2.4.2013 one flagging announcement was made. The Mutual Insurance Company Pension Fennia and LocalTapiola Mutual Pension Insurance Company will form a new Pension Company starting from 1.1.2014. The merger still requires the acceptance from the authorities and the general meeting. If the merger is realized, this leads to a situation where the new company owns more than 10 % of the shares and votes in Solteq Plc.
Exchange and share price
During the review period, the exchange of Solteq’s shares on the Helsinki Stock Exchange was 0.3 million shares (0.7 million shares) and 0.5 million euros (0.7 million euros). The highest price during the review period was 1.65 euros and the lowest price was 1.20 euros. The weighted average price of the share was 1.45 euros and the price ending was 1.46 euros. The market value of the company’s shares in the end of the review period totalled 21.9 million euros (13.7 million euros).
Ownership
At the end of the review period, Solteq had a total of 1.795 shareholders (1.821 shareholders). Solteq’s 10 largest shareholders owned 11.298 thousand shares, amounting to 75.3 per cent of the company’s shares and votes. Solteq Plc board members owned a total of 5.523 thousand shares which equals 36.8 per cent of the company’s shares and votes.
ANNUAL GENERAL MEETING
At Solteq Plc’s Annual General Meeting on 15 March 2013 the 2012 financial statements were adopted and the members of the board and the managing director were discharged from liability for the 2012 review period.
In the meeting was accepted the proposal by the board that for the financial year 2012, there will be paid a dividend of 0.04 euros per each share on the market. In addition to this, the annual general meeting authorized the board to decide on a distribution of dividend, or other distribution of funds from the equity trust, for an amount of maximum 0.04 euros. The board is also allowed to decide on the timing and other details of this.
The Annual General Meeting authorized the board to acquire or pledge the company’s own shares in such a way that the amount of own shares can be at any time maximum 10 per cent of the whole amount of company shares. With this authorization, shares can be acquired or pledged in order to develop the equity structure; or to be used as part of the personnel incentive system; or as a funding or for the realization of acquisitions of another company; or for other business arrangements; or they can be disclosed or invalidated. These shares can be acquired also in other ratios than the shareowners ownership ratio. The shares should be acquired from the public stock exchange. The board can decide on the other conditions for this procedure. This authorization is valid until next annual general meeting.
The Annual General Meeting authorized the board to decide on an issue of shares for a maximum amount of 3 000 000 new or existing shares, owned by the company, in one or several lots. The issue of shares should be implemented as a directed issue, on the contrary to shareowners subscription rights. With this authorization the board decides on all other conditions for the share issue. This authorization is valid until next Annual General Meeting.
BOARD OF DIRECTORS AND AUDITORS
Six members were elected to the Board of Directors. Ali Saadetdin, Seppo Aalto, Markku Pietilä, Matti Roininen, Sirpa Sara-aho and Jukka Sonninen continued as members of the board. The Board elected Ali Saadetdin to act as the Chairman of the Board.
KPMG Oy Ab, Authorized Public Accountants, is re-elected as Solteq’s auditors. Lotta Nurminen, APA, was elected to act as the chief auditor.
EVENTS AFTER THE REVIEW PERIOD
No events have occurred that require reporting after the review period.
RISKS AND UNCERTAINITIES
The key uncertainties and risks in short term are related to the timing and pricing of business deals that are the basis for revenue, changes in the level of costs and the company’s ability to manage extensive contract agreements and deliveries.
The key business risks and uncertainties of the company are monitored constantly as a part of the board of directors’ and management team’s duties. The company has not organized a separate internal audit organization or committee.
PROSPECTS
Solteq Plc estimates that for 2013 our turnover to be approx. 40-43 million EUR the level of EBIT approx. 6-9 %.
Financial Reporting
This interim report has been prepared in accordance with the recognition and measurement principles of IFRS-standards as is Financial Statements 2012.
The financial result is reported through three business areas: Grocery and special retail, HoReCa; Wholesale Trade, Logistics and Services and Service Business and Maintenance Management. The most essential product and service types of the Solteq group of companies are software services, licenses and hardware sales.
All forecasts and estimates presented in the interim report are based on the current views of management on the economic environment and outlook. Because of this, the results can differ as a result of, among other factors, changes in economy, markets and competitive conditions, changes in the regulatory environment and other government actions.
The interim report is unaudited.
| FINANCIAL INFORMATION | |||
| GROUP PROFIT AND LOSS ACCOUNT | |||
| (TEUR) | |||
| 1.1.- | 1.1.- | 1.1.- | |
| 31.3.2013 | 31.3.2012 | 31.12.2012 | |
| NET TURNOVER | 9 987 | 8 849 | 39 016 |
| Other operating | |||
| income | 4 | 891 | 900 |
| Raw materials and | |||
| services | -2 185 | -2 213 | -10 369 |
| Staff expenses | -5 042 | -4 372 | -19 304 |
| Depreciation and impairments | -299 | -227 | -1 126 |
| Other operating | |||
| expenses | -1 921 | -1 979 | -6 386 |
| OPERATING RESULT | 544 | 949 | 2 731 |
| Financial income and | |||
| expenses | -63 | -112 | -298 |
| RESULT BEFORE TAXES | 481 | 837 | 2 433 |
| Income taxes | -121 | -344 | -735 |
| 360 | 493 | 1 697 | |
| OTHER ITEMS OF TOTAL COMPREHENSIVE INCOME | |||
| Cash flow hedging | 20 | 19 | -45 |
| Other items of total comprehensive income | |||
| after taxes | 15 | 14 | -34 |
| TOTAL COMPREHENSIVE INCOME | |||
| 375 | 507 | 1 663 | |
| Total profit for the period attributable to | |||
| Owners of the parent | 360 | 493 | 1 697 |
| Total comprehensive income attributable to | |||
| Owners of the parent | 375 | 507 | 1 663 |
| Earnings / share, | |||
| e(undiluted) | 0,03 | 0,04 | 0,12 |
| Earnings / share, | |||
| e(diluted) | 0,03 | 0,04 | 0,12 |
| Taxes corresponding to the result have been presented as taxes for the period. | |||
| GROUP BALANCE SHEET (TEUR) | 31.3.2013 | 31.3.2012 | 31.12.2012 |
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Intangible assets | |||
| Intangible rights | 3 408 | 4 022 | 3 590 |
| Goodwill | 12 730 | 12 728 | 12 728 |
| Tangible assets | 1 276 | 944 | 942 |
| Investments | |||
| Other shares and similar | |||
| rights of ownership | 546 | 524 | 538 |
| Trade receivables | 63 | 67 | 63 |
| Total non-current | |||
| assets | 18 023 | 18 285 | 17 861 |
| CURRENT ASSETS | |||
| Inventories | 101 | 0 | 126 |
| Short-term debtors | 7 229 | 7 020 | 7 867 |
| Cash and cash equivalents | 2 169 | 1 455 | 1 242 |
| Total current | |||
| assets | 9 499 | 8 475 | 9 235 |
| TOTAL ASSETS | 27 522 | 26 760 | 27 096 |
| EQUITY AND LIABILITIES | |||
| CAPITAL AND RESERVES ATTRIBUTABLE TO THE SHAREHOLDERS | |||
| OF THE PARENT COMPANY | |||
| Share capital | 1 009 | 1 009 | 1 009 |
| Company's own shares | -933 | -933 | -933 |
| Share premium account | 75 | 75 | 75 |
| Account for cash flow | |||
| hedging | -34 | 0 | -49 |
| Unrestricted equity | |||
| fund | 6 392 | 6 935 | 6 368 |
| Retained earnings | 3 004 | 1 911 | 1 910 |
| Result for the | |||
| financial period | 360 | 493 | 1 697 |
| Total equity | 9 873 | 9 490 | 10 077 |
| Non-current liabilities | |||
| Deferred tax liabilities | 1 196 | 47 | 1 048 |
| Other non-current liabilities | 4 562 | 5 568 | 4 827 |
| Current liabilities | 11 891 | 11 655 | 11 144 |
| Total liabilities | 17 649 | 17 270 | 17 019 |
| TOTAL EQUITY AND | |||
| LIABILITIES | 27 522 | 26 760 | 27 096 |
| FINANCIAL PERFORMANCE | 1-3/2013 | 1-3/2012 | 1-12/2012 |
| INDICATORS (IFRS) | |||
| Net turnover MEUR | 10,0 | 8,8 | 39,0 |
| Change in net turnover | 12,9 % | 29,2 % | 43,7 % |
| Operating result MEUR | 0,5 | 0,9 | 2,7 |
| % of turnover | 5,5 % | 10,7 % | 7,0 % |
| Result before taxes MEUR | 0,5 | 0,8 | 2,4 |
| % of turnover | 4,8 % | 9,5 % | 6,2 % |
| Equity ratio, % | 35,9 | 35,5 | 37,2 |
| Gearing, % | 42,2 % | 60,3 % | 51,5 % |
| Gross investments in | |||
| non-current assets MEUR | 0,4 | 6,9 | 7,4 |
| Return on equity, % | 15,1 % | 26,8 % | 21,2 % |
| Return on investment, % | 13,8 % | 27,7 % | 20,8 % |
| Personnel at end of | |||
| period | 290 | 288 | 288 |
| Personnel average | |||
| for period | 289 | 218 | 270 |
| KEY INDICATORS PER SHARE | |||
| Earnings / share, e | 0,03 | 0,04 | 0,12 |
| Earnings / share, | |||
| e(diluted) | 0,03 | 0,04 | 0,12 |
| Equity / share, e | 0,66 | 0,67 | 0,67 |
| SEGMENT INFORMATION | |||
| Turnover by segment: | |||
| Me | 1-3/13 | 1-3/12 | Change |
| Grocery and special retail, HoReCa | 4,7 | 3,1 | +1,6 |
| Wholesale trade, Logistics and | |||
| Services | 3,9 | 4,4 | -0,5 |
| Service Business and | |||
| Maintenance Management | 1,4 | 1,3 | +0,1 |
| Total | 10,0 | 8,8 | +1,2 |
| Operating result by segment: | |||
| Me | 1-3/13 | 1-3/12 | Change |
| Grocery and special retail, HoReCa | 0,6 | 0,2 | +0,4 |
| Wholesale trade, Logistics and | |||
| Services | -0,2 | 0,9 | -1,1 |
| Service Business and | |||
| Maintenance Management | 0,2 | -0,1 | +0,3 |
| Total | 0,5 | 0,9 | -0,4 |
| QUARTERLY KEY INDICATORS (MEUR) | ||||
| 2Q/11 | 3Q/11 | 4Q/11 | 1Q/12 | |
| Net turnover | 7,32 | 5,32 | 7,65 | 8,85 |
| Operating result | 0,32 | 0,29 | 0,47 | 0,95 |
| Result before taxes | 0,27 | 0,26 | 0,43 | 0,87 |
| 2Q/12 | 3Q/12 | 4Q/12 | 1Q/13 | |
| Net turnover | 10,4 | 8,52 | 11,21 | 9,99 |
| Operating result | 0,39 | 0,51 | 0,88 | 0,54 |
| Result before taxes | 0,32 | 0,44 | 0,84 | 0,48 |
| CASH FLOW STATEMENT (MEUR) | |||
| 1-3/2013 | 1-3/2012 | 1-12/2012 | |
| Cash flow from business | |||
| operations | 2,00 | 0,65 | 2,28 |
| Cash flow from capital | |||
| expenditure | -0,46 | -5,47 | -5,95 |
| Cash flow from financing activities | |||
| Own shares | 0,00 | -0,09 | -0,10 |
| Dividend distribution | -0,52 | 0,00 | 0,00 |
| Return of equity (paid) | 0,00 | 0,00 | -0,45 |
| Directed issue | 0,00 | 3,13 | 3,02 |
| Loan agreements | -0,09 | 2,96 | 2,17 |
| Cash flow from financing | |||
| activities | -0,61 | 6,00 | 4,64 |
| Change in cash and cash | |||
| equivalents | 0,93 | 1,18 | 0,97 |
| TOTAL INVESTMENTS (TEUR) | |||
| 1-3/2013 | 1-3/2012 | 1-12/2012 | |
| Continuing operations, | |||
| group total | 420 | 6 891 | 7 439 |
| LIABILITIES (MEUR) | 31.3.2013 | 31.3.2012 | 31.12.2012 |
| Company quorantee for | |||
| credit limits | 10,00 | 10,00 | 10,00 |
| Lease contracts, machinery & | |||
| equipment | 0,08 | 0,86 | 0,10 |
| Lease liability, | |||
| premises | 3,89 | 4,55 | 4,08 |
| MAJOR SHAREHOLDERS MARCH 31, 2013 | |||
| Shares and votes | |||
| Number | % | ||
| 1. Saadetdin Ali | 3 481 383 | 23,2 | |
| 2. Eläke-Fennia Keskinäinen vakuutusyhtiö | 2 000 000 | 13,3 | |
| 3. Profiz Business Solution Oyj | 1 730 170 | 11,5 | |
| 4. Aalto Seppo | 1 662 206 | 11,1 | |
| 5. Keskinäinen Työeläkevakuutusyhtiö Varma | 644 917 | 4,3 | |
| 6. Pirhonen Jalo | 513 380 | 3,4 | |
| 7. Solteq Management Oy | 400 000 | 2,7 | |
| 8. Roininen Matti | 359 000 | 2,4 | |
| 9. Solteg Management Team Oy | 350 000 | 2,3 | |
| 10. Saadetdin Katiye | 156 600 | 1,0 | |
| 10 largest shareholders total | 11 297 656 | 75,3 % | |
| Total of nominee-registered | 20 047 | 0,1 % | |
| Others | 3 680 358 | 24,5 % | |
| Total | 14 998 061 | 100,0 % | |
| STATEMENT OF CHANGES IN GROUP EQUITY (TEUR) | ||||
| A=Share capital | ||||
| B=Company's own shares | ||||
| C=Share premium account | ||||
| D=Account for cash flow hedging | ||||
| E=Unrestricted equity fund | ||||
| F=Retained earnings | ||||
| G=Total | ||||
| A | B | C | D | E | F | G | |
| EQUITY 1.1.2012 | 1 009 | -835 | 75 | -14 | 3 800 | 1 910 | 5 945 |
| Total comprehensive income | 14 | 493 | 507 | ||||
| Acquiring of own shares | -99 | -99 | |||||
| Directed issue | 3 135 | 3 135 | |||||
| EQUITY 31.3.2012 | 1 009 | -933 | 75 | 0 | 6 935 | 2 404 | 9 490 |
| EQUITY 1.1.2013 | 1 009 | -933 | 75 | -49 | 6 368 | 3 607 | 10 077 |
| Total comprehensive income | 15 | 360 | 375 | ||||
| Directed issue | 24 | 24 | |||||
| Dividend distribution | -599 | -599 | |||||
| EQUITY 31.3.2013 | 1 009 | -933 | 75 | -34 | 6 392 | 3 364 | 9 873 |
| CALCULATION OF FINANCIAL RATIOS | |||||
| Solvency ratio, in percentage | |||||
| equity | x 100 | ||||
| ---------------------------------- | |||||
| balance sheet total - advances received | |||||
| Gearing | |||||
| interest bearing liabilities - cash, | |||||
| bank balances and securities | X 100 | ||||
| ------------------------------------------- | |||||
| equity | |||||
| Return on Equity (ROE) in percentage | |||||
| profit or loss before taxation - taxes | x 100 | ||||
| ---------------------------------------- | |||||
| equity | |||||
| Profit from invested equity in percentage | |||||
| profit or loss before taxation + | |||||
| interest expenses and other financing expenses | x 100 | ||||
| ---------------------------------------- | |||||
| balance sheet total - non-interest bearing | |||||
| liabilities | |||||
| Earnings per share | |||||
| pre-tax result - taxes | |||||
| +/- minority interest | |||||
| ------------------------------------ | |||||
| diluted average share issue | |||||
| corrected number of shares | |||||
| Diluted earnings per share | |||||
| diluted profit before taxation - | |||||
| taxes +/- minority interest | |||||
| ----------------------------------------------- | |||||
| diluted average share issue | |||||
| corrected number of shares | |||||
| Equity per share | |||||
| equity | |||||
| ----------------------- | |||||
| number of shares | |||||
Financial Reporting
Solteq Plc’s financial information bulletins in 2013 have been scheduled as follows:
- Interim Report 1-6/2013 on Wednesday July 17, 2013 at 9 am
- Interim Report 1-9/2013 on Friday October 18, 2013 at 9 am
More investor information is available from Solteq’s website at www.solteq.com
Additional information:
CEO Repe Harmanen,
Tel +358 400 467 717,
E-mail repe.harmanen@solteq.com
CFO Antti Kärkkäinen
Tel +358 20 1444 393 or +358 40 8444 393,
E-mail antti.karkkainen@solteq.com
Distribution:
NASDAQ OMX Helsinki
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