This is a correction of the announcement from 08:30 20.10.2016 CEST. Reason for the correction: The Cash Flow on page 12, column1 in pdf-report is corrected.
NEGATIVE CURRENCY EFFECT BUT STRONGER CASH FLOW
SUMMARY FOR JANUARY - SEPTEMBER 2016
- Net sales SEK 483 M (448)
- Profit before tax SEK 57,6 M (67,8)
- Operating margin 13,0 % (16,1)
- Earnings per share before dilution SEK 1,56 (1,80)
- Cash flow from operations SEK 123,8 M (105,8)
SUMMARY FOR JULY - SEPTEMBER 2016
- Net sales SEK 164 M (152)
- Profit before tax SEK 17,1 M (24,0)
- Operating margin 11,8 % (16,8)
- Earnings per share before dilution SEK 0,48 (0,65)
- Cash flow from operations SEK 17,9 M (7,0)
- Sales of Media and acquisitions of Tietomitta OY and Futursoft OY
CEO's comments
Adjusted for unrealized currency effects, increased amortization and the above one-time charge, the underlying profit is slightly stronger than last year, which also indicates by the improved cash flow. In addition, the earlier communicated sales and earnings decrease in business area Estate Agents in Sweden has now fully materialized in the quarter.
In the Norwegian part of our business area Estate Agents an efficiency program was executed in the third quarter. This has a negative one-time effect on the result of approximately 3 MSEK. The program is expected to generate about 4 MSEK in annual savings.
The third quarter began with the sale of the Media business, a unique event for Vitec. Media has developed towards custom application development, resulting in a significantly higher proportion of sales of services than in other parts of the Group. The sale was made to a consulting company where we believe Media's customers and employees will have good opportunities to continue to develop.
Shortly after the sale of Media we acquired Tietomitta OY forming a new business area - Environment. At the end of the quarter, we made our latest acquisition Futursoft OY that expands the business area Auto. Together, these acquisitions bring more than 80 million in sales with good profitability.
Vitec risk diversification is good, the proportion of recurring revenue high, 81% in the quarter, providing a good ability to absorb adverse events. This is proven by the Groups ability to develop as a whole despite the drop in business area Estate Agents.
The number of active dialogues for potential acquisitions remains high and we devoted significant resources to maintaining and further developing these dialogues. Vitec's financial position and readiness for future acquisitions is high, and we see good opportunities for further acquisition-based growth.
A clear shift from traditional license sales to subscription of cloud-based systems reduces reliance on individual license sales, which increases the long-term ability to control the business. This, together with the employees' proven capacity to innovate and integrate acquisitions, provides a solid foundation for long-term development of our business. With the acquisition of well-established companies and a high proportion of recurring revenues, Vitec continues on this path, to act in several independent and specialized niches to achieve sustainable profitable growth.
Lars Stenlund, CEO
Disclaimer: 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, October 20, 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 490 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
