asknet’s revenues and gross profits show positive trend in Q1 2017
• Revenues pick up 8 percent to 17.10 million euros
• Consolidated gross profit up 5 percent to 2.33 million euros
• Successful continuation of the start-up phase of new shops of Asian customers and software releases for existing customers
• Earnings before taxes (EBT) climb to -0.30 million euros (previous year: -0.49 million euros)
In the first three months of 2017, asknet AG, a supplier of global e-business technologies and solutions in the e-commerce market, recorded a much better business trend than in the previous year. Consolidated gross profits, which are the key performance indicator of asknet Group, rose by 5 percent to 2.33 million euros (previous year: 2.22 million euros). As the successful start-up phase of new shops of Asian customers continued in Q1 2017, sales revenues rose by 8 percent to 17.10 million euros (previous year: 15.77 million euros). As the share of customer transactions with lower-margin contracts increased, the gross profit margin declined from 14.1 percent to 13.6 percent. On the cost side, the company was able to notably reduce its other expenses from 1.33 million euros to 1.15 million euros thanks to the cost savings achieved in the context of the change process. At the bottom line, earnings before taxes (EBT) amounted to -0.30 million euros in the reporting period (previous year: -0.49 million euros).
Gross profits in asknet‘s Academics Business Unit rose from 0.70 million euros to 0.78 million euros in the reporting period. The increase was mainly due to the adjustment of the booking conditions for portal services and software licenses. Moreover, the sale of the IBM SPSS licenses in Switzerland will be pushed ahead. Gross profits in the eCommerce Solutions Business Unit climbed from 1.52 million euros to 1.55 million euros in the first quarter. The positive earnings trend is essentially attributable to the many new customer contracts signed in 2016, which are now gradually taking financial effect.
The first three months of 2017 also saw asknet continue the change process for the installation of a sustainable profitable business model. The main focus was on the reorganisation implemented with effect from November 1, 2016, which must be backed with appropriate processes and structures.
On balance, the business performance in the first quarter of 2017 was in line with the company’s plans. Consolidated gross profits are expected to pick up further in the full year 2017.
Says Tobias Kaulfuss, CEO of asknet AG: “Following a difficult year 2016, which was characterised by extraordinary effects on the one hand and by major sales successes on the other hand, we can now focus entirely on our core tasks. The first quarter has shown that our reform efforts to date are taking effect and that we are on the right track operationally. But as had been expected, we will probably not break even in 2017. This is due not only to the fact that sales revenues are picking up only gradually but also to the ongoing change measures, which constitute urgently required investments in sustainable corporate development. After all, only process improvements and intelligent innovations will allow us to expand our competitive position and to permanently position ourselves as an experienced, innovative and successful e-commerce specialist in the market.”
As announced in an ad-hoc release on May 22, 2017, the Executive Board and the Supervisory Board of asknet AG will propose an ordinary capital reduction to the shareholders at the Annual General Meeting on July 6, 2017. The reduction of the share capital would allow the company to offset the loss posted for the period ended December 31, 2016. As this is a nominal reduction, the shareholders' holdings in asknet AG will not change as a matter of principle. Rather, the financial footing of the company is adjusted and the flexibility in corporate financing is increased in the ongoing change process.
The convocation of the Annual General Meeting including the announcement of the full agenda will follow shortly.
Selected key figures of the Group
January 1 – March 31 2017:
Sales revenues: EUR 17.10 million
Gross profits: EUR 2.33 million
Gross profit margin (in percent of sales revenues): 13.6 %
EBT: EUR -0.30 million
Result for the period: EUR -0.30 million
January 1 – March 31 2016:
Sales revenues: EUR 15.77 million
Gross profits: EUR 2.22 million
Gross profit margin (in percent of sales revenues): 14.1 %
EBT: EUR -0.49 million
Result for the period: EUR -0.49 million
The condensed financial statements for the first three months of 2017 are available on the company’s website at www.asknet.de as of today.
asknet Group is an innovative supplier of e-business technologies and solutions for the global distribution and management of digital and physical goods. Founded in 1995 as a spin-off of the Karlsruhe Institute of Technology (KIT), the company is a pioneer of modern e-commerce with over 20 years’ experience in the field.
asknet’s eCommerce Solutions Business Unit (previously Digital Goods and Physical Goods Business Unit) enables international manufacturers to successfully market their products in over 190 countries. The core product, asknet eCommerce Suite, covers the complete sales process and is suitable for manufacturers of both digital and physical goods. In addition, the company offers stand-alone services and solutions along the value chain. asknet’s Academics Business Unit assists customers from the research and education sector in purchasing and managing software and hardware. Thanks to its close relations with over 80% of Germany’s universities and research institutions, asknet is intimately familiar with their needs and requirements and can offer them specific solutions. For more information, visit www.asknet.com.
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