Unit 4 Agresso announces half-year results 2007
Earnings per share: +109%; organic turnover growth: +14%;good prospects: increase target for 2007 EBITDA to +20%
- Turnover increases by 45% to €155.5 million (H1 2006: €107.1 million)
- EBITDA increases by 16% to €21.1 million (H1 2006: €18.2 million)
- Turnover from maintenance contracts again shows sizeable growth: 52%
- Operational cash flow amounts to €29.1 million in the first half of the year
- Earnings per share increase by 109% to €0.92
- Substantial investments in personnel as a result of 14% organic growth
- Sale NOXS activities finalized, sales result is presented under‘discontinued operations’
ERP…with NO expiration date
The market in the first half of 2007 can be characterized as a replacement market. Fundamental organizational changes, technical and functional ‘expiration’ and excessive maintenance and adjustment costs force organizations to replace their software systems every seven to nine years. Unit 4 Agresso positions itself as a software supplier to organizations that are faced with constant change. Through the proposition ‘post implementation agility’ Unit 4 Agresso indicates that its software system Agresso Business World can follow changes in an organization easily and efficiently. Where competitors’ systems require substantial adjustments and eventually ‘expire’ economically, Unit 4 Agresso’s system has in principal no expiration date. The results in the first half of 2007 prove the strength of this positioning: Unit 4 Agresso realized an organic growth in licenses of 16% and an organic growth in maintenance contracts of 15%. In the first half of 2007 Unit 4 Agresso signed a record number of deals worth over €1million. Furthermore, market analysts increasingly acknowledge the added value of Unit 4 Agresso’s software systems.
In the first half of the year, total turnover grew by 45% to €155.5 million. Organic turnover increased by approximately 14%. The EBITDA amounted to €21.1 million. Compared to the first half of 2006 this is an increase of 16%.
No growth without investments
The EBITDA margin decreased to 13.6% (H1: 17.0%) owing to acquisitions and investments in personnel. The increasing demand for Unit 4 Agresso products created a need for substantial expansion of implementation capacity. Compared to the first half of 2006, app. 150 additional employees, mainly consultants (+11%)were taken on. These employees have to be trained before they contribute to the result. This investment is expected to bring returns in the second half of the year. In the first half of 2007, many third party employees were also hired, which explains the decline of the gross margin (H1 2007: 87.7% and H1 2006: 89.3%). Next to that the margins of some of the companies acquired in 2006 (CCS, Dogro and Kirp) are lower than the margin of the Unit 4 Agresso group as a whole. Synergy and cooperation will improve the margins of these acquisitions in the coming years.
Net earnings per share: +109%
Before depreciations and acquisition-related impairment, they rose by 109% to €0.92. This includes, among other things, the result of the sales of the NOXSactivities. The net result increased by 92% to €18.0 million (H1 2006: 9.4 million). The net result of the continuing operations amounted to €6.5 million (H1 2006: €8.0 million). The reasons for this decline can be found in the increased depreciations on the intangible assets relating to acquisitions (previously: goodwill) and other depreciations. Total depreciations grew by €6.8 million in the first half of 2007.
Product turnover: +41%
The turnover from products (licenses) showed a steady growth over the first half of 2007 and rose by 41% to €31.8 million (H1 2006: €22.5 million). Organically, the product turnover increased by 16%.
Contracts and subscriptions: + 52%
Both existing and new customers form the growing and solid base for our turnover from maintenance contracts, which rose by 52% to €64.4 million (H1 2006: € 42.5 million). The share of the maintenance turnover in the total turnover increased to 41.5% (H1 2006: 39.7%). This category is particularly important owing to its recurring nature. Besides that, the growth factor is related directly to the license turnover and the satisfaction of existing customers. The consistent rise in the share of turnover from maintenance and services means an improvement of Unit 4 Agresso’s risk profile since it diminishes its dependence on the economic climate and the market’s willingness to invest.
Turnover from services: +41%
Turnover from services rose by 41%. The largest part of these services consists of the implementation of the software at our clients. The development of the turnover from these services is closely connected with the development of license turnover. Unit 4 Agresso invested substantially in additional capacity in the first half of 2007 in order to meet the rising demand for products and services.
The strongest increases in turnover were realized in Germany (+187%) and Spain(+432%), thanks to the acquisitions of Dogro and Kirp in Germany and the acquisition of CCS in Spain. North America is experiencing a momentum in the market for larger services companies and local government, resulting in an organic turnover growth of 49%. The Benelux saw the turnover rise by 37%, which was realized among others by the increasing demand for our software system Agresso Business World. In Sweden, turnover increased by 19%, in the UK by 17% and in Norway by 14%.
Unit4 Business Software GmbH
Das Unternehmen Agresso GmbH wurde im Jahr 1980 gegründet und ist eine 100-prozentige Tochter des niederländischen Konzerns Unit 4 Agresso. Das Unternehmen hat sich auf ERP-Lösungen für kommerzielle Dienstleister und den öffentlichen Sektor spezialisiert. Das Kernprodukt ist die "Agresso Business World", das bei 2.600 Kunden in über 100 Ländern im Einsatz ist. Mit der Akquisition der Firmen Dogro und Kirp im Jahr 2006 hat Unit 4 Agresso seine Position im öffentlichen Bereich in Deutschland gestärkt. Die Muttergesellschaft Unit 4 Agresso ist an der holländischen Börse notiert (EURONEXT - U4AGR) und hat insgesamt 3.200 Mitarbeiter in zwölf Ländern. Der Konzernumsatz belief sich 2007 auf 320,5 Millionen Euro.
Mehr Informationen über Agresso unter: www.agresso.de