31.08.2018
adesso AG DE000A0Z23Q5
DGAP-News: adesso sees high sales and earnings growth in first half of 2018
DGAP-News: adesso AG / Key word(s): Half Year Results
adesso sees high sales and earnings growth in first half of 2018
31.08.2018 / 07:32
The issuer is solely responsible for the content of this announcement.
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adesso sees high sales and earnings growth in first half of 2018
- Sales grow by 19 % to EUR 177.5 million
- EBITDA comes to EUR 12.1 million (+59 %)
With the presentation of its half-year report, adesso AG has confirmed its
growth-driven sales and earnings forecast for 2018. In the first six months
of 2018, adesso Group increased sales year on year almost entirely
organically by 19 % to a new half-year record of EUR 177.5 million. While
investment in strong growth in the previous year had a disproportionately
negative impact on earnings, adesso Group achieved a significant 59 %
year-on-year increase in earnings before interest, taxes, depreciation and
amortisation (EBITDA) in the first six months of 2018.
adesso Group increased sales year on year in the first half of 2018 by 19 %
to EUR 177.5 million. Almost all of this growth was achieved organically.
Business was bolstered by ongoing investment from companies and
public-sector authorities in digital transformation, increased efficiency
through the modernisation of IT systems and e-commerce activities.
Additional drivers of growth include new approaches and technologies such as
business intelligence based on big data, machine learning and artificial
intelligence, the internet of things (IoT) and blockchain. adesso Group
holds a strong market position in these areas with a wide range of products
and solutions. In the first half of 2018, projects involving intelligent
chatbots and augmented reality in the automotive sector, for example, were
brought to a successful close. An order to develop a financial transaction
platform using blockchain technology was also landed. While mainly smaller
proofs of concept and demos were developed in previous years, the size of
these innovation projects is now significant. adesso Group has secured an
important new client with a leading company from the energy sector. Plans
call for the joint development of everything from e-mobility concepts to
white-label settlement platforms based on IoT approaches.
All established adesso subsidiaries (Germany, Switzerland, Austria and
Turkey) increased sales year on year. Based on volume, adesso Group once
again achieved the biggest rise in sales in Germany, which benefited from
very strong headcount growth in the past 18 months and the ability to secure
a variety of projects in all key industries. Sales growth in banking was
particularly significant. In Austria, the positive trend from the second
half of 2017 continued, with sales rising by 20 %. The establishment of
subsidiaries in Bulgaria and Spain has laid the foundation for additional
growth in years ahead. Both subsidiaries have already hired a number of
employees and received their first smaller orders.
Business with the in|sure product family for companies from the insurance
sector also experienced positive development. The first half of 2018 saw the
landing of DKV - one of the largest private health insurance companies - as
a client, which will be implementing in|sure Health Claims for nursing care
insurance. Another key contract for in|sure Health Claims was signed,
although it can only be recognised as relevant to sales in the fourth
quarter of 2018 at the earliest given non-utilisation of rights of
withdrawal.
Within the first half of the year, EUR 88.6 million in sales was generated
in the first quarter and EUR 88.9 million in the second quarter (previous
year: EUR 75.7 million and EUR 74.0 million).
Results of operations
adesso Group's operating result, namely earnings before interest, taxes,
depreciation and amortisation (EBITDA), came to EUR 12.1 million in the
first half of 2018, up 59 % year on year. During the previous year, the
second quarter in particular delivered a weaker performance. Compared to the
second half of 2017 and the guidance for 2018 as a whole, EBITDA actually
achieved by the Group falls well within the expected range.
While higher costs were incurred in the previous year for the establishment
and expansion of new locations, employer branding and recruitment, and while
the billable customer hours per employee in Germany were too low,
investments in strong growth paid off in the first half of 2018. The
billable customer hours in Germany have returned to a normal level. Other
operating expenses per employee fell year on year by 9 %.
In the first half of 2018, the first quarter generated EBITDA of EUR 7.2
million (previous year: EUR 5.2 million) and the second quarter generated
EBITDA of EUR 4.9 million (previous year: EUR 2.5 million). The lower
earnings in the second quarter were mainly due to the lower number of
working days. While the main part of earnings growth was generated by the
adesso subsidiary in Germany, Turkey and Austria were responsible for
boosting earnings considerably in terms of percentage. At 7 % higher
depreciation and amortisation, pre-tax profit was up EUR 4.2 million, or 120
%, on the previous year and therefore grew more sharply than EBITDA.
Consolidated earnings amounted to EUR 5.0 million (previous year: EUR 2.2
million) and earnings per share stood at EUR 0.81 (previous year: EUR 0.36).
As at the reporting date, adesso held liquid assets of EUR 39.7 million
(previous year: EUR 28.1 million; 31 December 2017: EUR 46.5 million). Net
liquidity less financial liabilities amounted to EUR -7.5 million as at the
reporting date (previous year: EUR -17.7 million). The decline in liquid
assets over the first half of the year is in line with the development of
liquidity in previous years and was largely due to the scheduled payment of
variable salary components for the previous year and the payment of
dividends. However, cash flow from operating activities was already in
positive territory in the first half of the year at EUR 2.2 million
(previous year: EUR -3.5 million).
The business operations acquired from FABIS during the reporting period will
strengthen the in|sure product portfolio with regard to the calculation of
commissions. While the additional functionality and expertise of the
employees gained in this process are of great benefit, their impact on the
consolidated key figures for sales and earnings was minor.
In the first half of 2018, business grew by 19 %, with sales continuing to
increase far in excess of the market as a whole as the year progressed.
Incoming orders, order backlog and capacity utilisation are at good levels
as at the reporting date, and sales are expected to continue to improve in
the second half of the year. The aim is to recruit additional employees at
all adesso subsidiaries. The sales target for 2018 of more than EUR 350
million seems to be feasible. Efforts are under way to pursue a number of
sales opportunities for the in|sure insurance software that could result in
the signing of contracts whose sales might still apply to 2018. In
comparison to the first half of the year, EBITDA is expected to increase in
the second half of 2018. adesso Group stands by its earnings forecast for
2018 as a whole in terms of EBITDA of more than EUR 27.7 million (first half
of 2018: EUR 12.1 million) and an EBITDA margin target of at least 7.5 %.
The complete half-year report and an overview of key performance indicators
in table form are available in the Investor Relations section on the website
www.adesso-group.de.
adesso Group
With over 2,900 employees and annual sales of EUR 321.6 million in 2017,
adesso Group is one of the largest German IT service providers and has
outstanding opportunities for growth. At its own locations in Germany,
Austria, Switzerland, Turkey, Spain, Bulgaria, USA and the UK as well as at
numerous customer sites, adesso offers consulting and software development
services for optimising core business processes. adesso also offers
ready-to-use software products for standard applications. The development of
an own, industry-specific product-portfolio opens up additional growth and
earnings opportunities and is another key element of the adesso strategy.
2016 and 2018, adesso was awarded as the best employer in the german
IT-sector.
Contact:
Martin Möllmann
Manager Investor Relations
Tel.: +49 231 7000-7000
E-Mail: [email protected]
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31.08.2018 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.
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Language: English
Company: adesso AG
Stockholmer Allee 20
44269 Dortmund
Germany
Phone: +49 231 7000-7000
Fax: +49 231 7000-1000
E-mail: [email protected]
Internet: www.adesso-group.de
ISIN: DE000A0Z23Q5
WKN: A0Z23Q
Listed: Regulated Market in Frankfurt (General Standard);
Regulated Unofficial Market in Berlin, Dusseldorf,
Hamburg, Stuttgart, Tradegate Exchange; London
End of News DGAP News Service
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