DGAP-News: ifa systems AG / Key word(s): Quarterly / Interim Statement/Half Year Results ifa systems reaches the break-even point 6 months into 2018 (news with additional features) 10.08.2018 / 08:00 The issuer is solely responsible for the content of this announcement. --------------------------------------------------------------------------- * Sales in the first half-year, as expected, slightly lower than last year's level * Cost reductions produce a clear improvement of earnings: an EBITDA margin of 18.9 percent and EBIT back into the black * Forecast for the full year 2018 confirmed: sales at EUR6.3m to 6.8m and a balanced result (EBIT) Frechen, August 10, 2018 ifa systems AG, a listed specialist for Health-IT applications in the eye-care sector, clearly improved its result for the first half of 2018 in spite of slightly lower group sales (EUR3.1m after EUR3.3m in the same period of last year). As a result of the restructuring measures, EBITDA (earnings before, interest, taxes, depreciation and amortisation) rose by EUR1.2m to EUR591 thousand (previous year: minus EUR614 thousand), which corresponds to a margin of 18.9 percent. There was a marked decrease in personnel costs (down 23.8 percent) and other expenditure (down 57.3 percent), an item where trade fair and event costs, the development services by third parties and occupancy costs played a prominent role. The operating result (EBIT) now stands at EUR41 thousand (previous year: minus EUR1.6m), which puts it at the level planned for the full year, namely a number in the black. "Operating business has developed according to plan," says Jörg Polis, Chairman of the Board of Management (CEO) of ifa systems AG. "To a large extent we have even succeeded in compensating for the gap left by the completion of the project business with Topcon last year. And the restructuring phase having ended, the cost reductions now are showing an obvious impact." Following the changes in accounting rules introduced under IFRS 15 in the future the revenues from the Runtime licences will be distributed more evenly over the relevant licence periods and so there will be less fluctuation. In the first half of the year this resulted in an increase in revenues from Runtime licences from EUR1.1m to EUR1.6m (up 52.4 percent). The accounting changes have also had an impact on the balance sheet. Sales from previous years, which relates to periods after the beginning of 2018, were recognised in the balance sheet as other reserves. The negative effect that this had on equity will be eliminated step by step across the periods involved. The success of the restructuring can also be seen from the cash flow statement as at 30 June 2018. For example, operating cash flow improved by nearly EUR1.4m compared with the same period of last year to minus EUR323 thousand (previous year minus EUR1.7m). The cash flow from investments was only at EUR416 thousand after EUR694 thousand in the previous year. As had been announced, capitalised development services fell sharply in comparison with the previous years. At minus EUR739 thousand, free cash flow was still negative, but showed distinct improvement compared with the previous year (minus EUR2.4m). Whereas cash flow from financing was shaped by taking up the loans granted by Topcon and Mizuho Bank last year, in the first half of 2018 there were no such significant activities in this area. Cash and cash equivalents at the end of the reporting period amounted to EUR3.6m (previous year as at 30 June: EUR3.5m). Outlook The management board expects the ifa group to reach a sales level of EUR6.3m to EUR6.8m for the full year 2018. The board is confident, on the basis of the midyear numbers, that this aim will be achieved. On the one hand, in spite of the changes to accounting rules, a slightly larger contribution to the sales total is expected to come from the Runtime licences in the second half of the year. On the other, a positive effect is expected to result from the telematics infrastructure (TI) project. Telekom's connector was released for use a short time ago. This fulfilled the prerequisite for linking up German ifa customers to TI. However, whether it will be possible to execute all the orders expected by the date stipulated by the law, 31 December 2018, cannot be assessed with certainty at the present moment. Slightly higher sales in the second half of the year should of course have a positive impact on the results situation. In addition, some of the restructuring measures will have a belated effect, so that results for the second half-year could even turn out to be mildly improved. Management therefore continues to be comfortable with the aim of going into the black at EBIT level for the full year. "Our paramount aim - now that the operating business is again, to a large extent, proceeding along orderly lines - is that the ifa group should get back to generating positive cash flows", says Polis. "However, we want to achieve this on the basis of current operating business and not mainly by advance payments of our customers. Instead, we're going to continue working on improving the operating result, so that we strengthen our internal financing power." By concentrating on its core competencies the ifa group has again orientated itself to future corporate success. The course of business in the first half of the year shows that sales and results are developing as planned. The board is therefore confident that the aims for the full year will be achieved. On this basis, the course for future growth in the established markets is now to be carefully set. Detailed information can be found in the complete interim report for 2018. It is available for downloading on the internet at www.ifa-systems.de, Investor Relations. Key figures table as at 30 June 2018 ifa systems Group, in compliance with IFRS in EUR '000 except where stated 2014 2015 2016 2017 30 Jun otherwise 18 Sales 8,077 8,267 8,864 8,553 3,133 own development work 2,341 2,395 1,596 824 414 capitalized Total performance 10,806 11,676 11,893 9,592 3,764 EBITDA 3,297 3,414 1,030 -2,942 592 EBITDA margin (%) in relation 40.8% 41.3% 11.6% -34.4% 18,9% to sales EBIT 2,419 2,686 -2,216 -7,797 42 EBIT margin (%) in relation to 29.9% 32.5% -25.0% -91.2% 1,1% sales Consolidated net income / loss 1,538 2,062 -2,224 -9,291 -12 Earnings per share (EUR) 0,56 0,75 -0,81 -3,38 0,00 Operating cash flow 2,502 1,708 1,222 544 -323 Free cash flow -384 -1,108 -474 -296 -739 Balance sheet total 23,446 26,446 22,965 20,740 19,704 Equity 17,875 20,271 15,806 8,267 6,925 Equity ratio (%) 76,2% 76,7% 68,8% 39,8% 35,1% Employees (average) 82 87 91 73 58 Total performance per employee 134 131 131 65 132 Number of shares ('000) 2,500 2,750 2,750 2,750 2,750 --------------------------------------------------------------------------- Additional features: Document: http://n.eqs.com/c/fncls.ssp?u=EWCGGQUYFL Document title: ifa systems Half-year report 2018 --------------------------------------------------------------------------- 10.08.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de --------------------------------------------------------------------------- Language: English Company: ifa systems AG Augustinusstraße 11 b 50226 Frechen Germany Phone: +49 (0)2234 93367-0 Fax: +49 (0)2234 93367-30 E-mail: [email protected] Internet: www.ifasystems.de ISIN: DE0007830788 WKN: 783078 Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt (Basic Board), Munich, Stuttgart, Tradegate Exchange End of News DGAP News Service --------------------------------------------------------------------------- 712661 10.08.2018