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ENDigia Plc Financial Statement Bulletin 2016
Digia Plc
Financial Statement Bulletin
3 February 2017 at 8:00 am
Digia Plc Financial Statement Bulletin 2016
A year of laying the foundations for Digia's growth - full-year net sales up about 7 per cent
The demerger of Digia Plc and Qt Group Plc came into force on 1 May 2016. This financial statement bulletin presents the business operations of Digia Plc, the former Domestic segment (continuing operations). Qt Group's business operations are treated as discontinued operations. In addition to Qt's net result, the reported figures for discontinued operations include demerger expenses and the difference between the fair values and carrying amounts of net assets transferred to Qt.
Unless otherwise stated, the comparison figures provided in parentheses always refer to the corresponding period of the previous year.
October-December
- Net sales EUR 23.7 (23.2) million, up 2.2 per cent
- Operating profit EUR 1.6 (2.0) million, 6.6 (8.8) per cent of net sales
- Earnings per share EUR 0.05 (0.05)
January-December
- Net sales EUR 86.5 (80.9) million, up 6.8 per cent
- Operating profit EUR 5.4 (5.9) million, 6.3 (7.2) per cent of net sales
- Earnings per share EUR 0.20 (0.20)
- Earnings per share (discontinued operations) EUR 3.63
- Digia's Board of Directors proposes the payment of a dividend of EUR 0,08 per share (EUR 0.08 per share in 2015).
- Outlook for 2017: Digia's net sales growth is expected to accelerate in 2017 (2016: net sales up 6.8%). Operating profit in 2017 is estimated to remain on a par with the previous year.
GROUP KEY FIGURES
| 10-12/ 2016 | 10-12/ 2015 | Change, % | 1-12/ 2016 | 1-12/ 2015 | Change, % | |
| Continuing operations | ||||||
| Net sales | 23,694 | 23,184 | 2.2% | 86,463 | 80,946 | 6.8% |
| Operating profit | 1,573 | 2,039 | -22.8% | 5,419 | 5,854 | -7.4% |
| - as a % of net sales | 6.6% | 8.8% | 6.3% | 7.2% | ||
| Profit for the period | 1,002 | 1,285 | -22.0% | 4,064 | 4,246 | -4.3% |
| - as a % of net sales | 4.2% | 5.5% | 4.7% | 4.8% | ||
| Profit for the period, discontinued operations | 21 | 381 | 75,843 | 981 | ||
| Total profit for the period, continuing and discontinued operations | 1,023 | 1,666 | 79,907 | 5,228 | ||
| Return on equity, % | 48.7% | 14.4% | 11.0% | 13.5% | ||
| Return on investment, % | 34.5% | 16.9% | 11.0% | 15.6% | ||
| Interest-bearing liabilities | 13,686 | 13,513 | 1.3% | 13,686 | 13,513 | 1.3% |
| Cash and cash equivalents | 1,994 | 6,710 | -70.3% | 1,994 | 6,710 | -70.3% |
| Net gearing, % | 35.6% | 16.6% | 35.6% | 16.6% | ||
| Equity ratio, % | 49.8% | 53.7% | 49.8% | 53.7% | ||
| Earnings per share, EUR, undiluted | 0.05 | 0.07 | 0.20 | 0.20 | ||
| Earnings per share, EUR, diluted | 0.05 | 0.07 | 0.20 | 0.20 |
DIGIA'S PRESIDENT & CEO TIMO LEVORANTA
"We revised our strategy in conjunction with the demerger of Digia and Qt. Our growth strategy, which was published in the spring, seeks to strengthen the company's position, particularly in the growing market for digital services, process digitalisation and the service business. We want to significantly outpace IT market growth and are seeking average annual growth of 15 per cent. We are seeking growth both organically and inorganically.
2016 was a year of building our business and creating a foundation for growth. 2017 is a year of accelerating growth.
In order to support this growth, we restructured our organisation and began updating our operating models. Digia now comprises four service areas: Digital Services, Integration and Information Management, Industry Solutions, and Digia Financial Solutions and Services.
During the year, we grew both organically and through acquisitions. We enhanced and restructured our expertise, and also actively invested in recruitment. Digia's payroll increased by 113 people in 2016, of whom 75 persons were hired during the second half of the year.
We made a strategic acquisition in June, bolstering our position in digital services and the growing e-commerce market by acquiring the entire share capital of Igence Oy Ab.
In Finance Solutions and Services, we launched a new business in which we offer a variety of services, such as back office functions for asset management. We launched cooperation with our first customer at the beginning of October.
In November, we signed a 15-year framework agreement with the Tax Administration to deliver, maintain and further develop the national income register solution. The project was launched in late 2016. At Digia, we are working to make Finnish society more competitive and functional through digitalisation.
Digia's net sales for 2016 totalled EUR 86.5 (80.9) million, representing growth of 6.8 per cent on the previous year. Net sales growth was supported by growth in the integration business, the customised solutions service business, the ERP business based on the company's own technologies, and the acquisition made in the digital services segment during the summer. In the last quarter, net sales growth slowed down due to certain challenging delivery projects.
Digia's operating profit totalled EUR 5.4 (5.9) million in 2016. Operating profit was impacted by recruitment and sales outlays and the end of a long-term maintenance customer relationship in Financial Solutions and Services in Sweden.
In the view of the company's management, digitalisation and the transformation of business models involve major opportunities. Demand for IT systems and software as services continued to became increasingly commonplace. This trend can be seen throughout Digia's offering. To respond to these opportunities, Digia is continuing to make outlays on the renewal of its business models, personnel development and recruitment as well as bolstering its offering.
We estimate that market development will be favourable compared with 2016. Our key goal in 2017 is to accelerate our net sales growth."
PROPOSAL FOR DIVIDEND DISTRIBUTION
The distributable shareholders' equity of Digia Plc totalled EUR 33,571,493 on 31 December 2016, of which EUR 2,297,693 was net profit for the year. At the Annual General Meeting, the Board of Directors will propose that a dividend of EUR 0,08 per share be paid according to the confirmed Balance Sheet for the fiscal year ending 31 December 2016. Shareholders listed in the shareholder register maintained by Euroclear Finland Oy on the dividend reconciliation date, 20 March 2017, will be eligible for the dividend. Dividends will be paid on 29 March 2017.
INVITATION TO THE BRIEFING ON THE FINANCIAL STATEMENT BULLETIN
Digia will hold a briefing for analysts on Friday 3 February 2017 at 11 am, in the Espa cabinet at Hotel Scandic Simonkenttä, Simonkatu 9, 00100 Helsinki, Finland. Welcome.
The presentation and materials for the event will be available from 11 am on 3 February 2017 in the Investors section of the company's website: www.digia.com/en/investors/reports-and-presentations.
FINANCIAL STATEMENTS AND ANNUAL REPORT 2016
Digia Plc's 2016 Annual Report will be published on 16 February 2017 in electronic format on the company's website: www.digia.com and vuosikertomus2016.digia.com.
The Report of the Board of Directors and the 2016 Financial Statements will be published as part of the Annual Report.
APPLICATION OF NEW ESMA GUIDELINES
Digia Plc has adjusted the terms used in its financial reporting in accordance with the new guidelines on Alternative Performance Measures (APM) issued by the European Securities and Markets Authority (ESMA).
FURTHER INFORMATION
President & CEO Timo Levoranta, tel. (exchange) +358 (0)10 313 3000
DISTRIBUTION
NASDAQ Helsinki
Key media
www.digia.com
Digia is a profitably growing IT service company that helps its customers harness digital opportunities. As a visionary partner, Digia develops and innovates solutions that support business operations together with its customers. We adapt our expertise to their specific industries to help them develop digital services, manage operations and utilise information. We operate in Finland and Sweden with our team of 872 experts. We are expanding our international presence together with our customers. Digia's net sales in 2016 (continuing operations) totalled EUR 86.5 million. The company is listed on NASDAQ Helsinki (DIG1V). www.digia.com
Digia is a software and service company that combines technological possibilities and human capabilities to build intelligent business, society and a sustainable future. Our mission is to ensure that our customers are at the forefront of digital evolution. There are more than 1,500 of us working at Digia and we operate globally with our international customers. Digia’s turnover in 2023 was EUR 192,1 million. The company is listed on Nasdaq Helsinki (DIGIA).