Ordina N.V. results first quarter 2015: Turnover declines, limited impact on margin
30 April 2015 - 7:30AM
Nieuwegein, 30 April 2015
Highlights
- Recurring EBITDA down at EUR 4.1 million (Q1
2014: EUR 4.8 million);
- Recurring EBITDA margin drops to 4.7% (Q1 2014:
5.1%);
Turnover declines by 4.9% to EUR 88.5 million (Q1 2014: EUR 93.6
million);
- Net debt position improved at EUR 7.0 million (Q1
2014: EUR 12.4 million), ratio net debt / adjusted EBITDA stands at
0.7 (maximum leverage ratio: less than or equal to 1.50);
- Ordina nominated for the Computable Awards
2015;
- Clockwork nominated for Dutch Interactive
Awards.
Stépan Breedveld, CEO Ordina, about the
results
"Turnover at our largest division, T&C, fell in the first
quarter, while the other divisions managed to realise (normalised)
growth in difficult market conditions. The effect on the margin was
limited, as a result of our constant focus on costs and a more
selective projects intake.
Our net debt position improved to EUR 7.0 million.
Recent media reports and the debate related to public sector IT
projects have led to a delay in decision-making on IT projects in
the public and healthcare markets in the Netherlands. A number of
large industrial clients are currently in the midst of cost cutting
exercises, which is having an impact on the hiring in of IT
staff.
Our main priority for the period ahead will be
raise productivity. Our salesforce effectiveness programme should
result in greater focus and specialisation in our client approach.
We are also accelerating our innovation programme by creating
increasing our focus in areas that represent value for our clients.
Our initiatives on this front are gaining recognition. For
instance, we have been nominated for the Computable Awards 2015 and
Clockwork, Ordina's digital engagement bureau, has been nominated
for the Dutch Interactive Awards."
Outlook
We decline to give a forecast for the coming period.
Turnover
Turnover in the Public Sector and Healthcare
segments was down as a result of delays in decision-making
following recent media reports and the debate related to government
IT projects. Turnover in Financial Services remained relatively
stable. The decline in the Industry sector was driven largely by
cost cutting at a number of large clients in the energy and
telecommunications sectors.
Technology &
Competencies
The Technology & Competencies division designs and builds
applications for our clients in the form of secondment, sourcing
and project contracts for both out of the box and tailor-made
solutions. Turnover declined by 12.3% to EUR 41.3 million (Q1 2014:
EUR 47.1 million). This decline was largely due to a drop in the
number of public sector projects and a decline in demand from a
number of large clients in the energy and telecom sectors who are
currently implementing cost reduction programmes.
Business Consulting &
Solutions
The Business Consulting & Solutions division advises clients on
how they can improve their processes and IT systems. The division
also combines business know-how and technical expertise to devise
sustainable solutions in the field of business intelligence,
(digital) client interaction, chain integration and security.
Turnover declined by 3.6% to EUR 14.0 million (Q1 2014: EUR 14.6
million). Corrected for the downsizing of the generic activities of
Ordina Consulting Public and the sale of Fundation (impact Q1: EUR
1.2 million), turnover was up 5.0% as a result of new projects for
clients in the carriers and mainports sector and growth at a number
of smaller financial institutions.
Application Management
The Application Management division is responsible for management,
maintenance and renovation of applications in the form of long-term
contracts. Turnover was up 3.3% at EUR 14.4 million (Q1 2014: EUR
13.9 million). Turnover was up primarily at a number of clients in
the carriers and mainports sector.
Belgium/Luxembourg
Turnover in the Belgium/Luxembourg division rose by 4.5% to EUR
18.8 million (Q1 2014: EUR 18.0 million). The increase in turnover
was largely on the back of growth at large clients in the industry
and financial services sectors in both Belgium and
Luxembourg.
Sourcing
The Sourcing division acts as strategic partner for large clients,
helping them to improve the added value of hired-in IT personnel.
Client-specific improvement programmes in the field of productivity
improvements, talent development, know-how exchange and innovation
are an integral part of this approach. As from 2015, Sourcing is no
longer reported as a separate division but deployed on a broader
scale for the clients of all divisions in the form of a
differentiated delivery model. As from 1 January 2015, the turnover
and costs of the sourcing model will be reported in the results of
the divisions delivering the services in the Netherlands.
Growth and
innovation
Our salesforce effectiveness programme should contribute to an
increase in productivity. Our Commerce department will be working
in smaller teams with a more clearly defined specialisation in
terms of delivery models.
We will accelerate our positioning as an innovative IT partner. We
have defined a number of 'growth diamonds' in which we join forces
with our clients to experiment with innovative applications that
add value to their business. It is also important in this context
that we expand and intensify our ties with universities, start-ups
and knowledge centres to arrive at co-creation with those
organisations.
Employees
At the end of the first quarter of 2015, the number of direct
employees was up by 7 FTEs, partly as a result of the intensified
recruitment of Young Professionals. The number of indirect
employees was up by 6 FTEs, who filled existing
vacancies.
In order to further improve productivity, we are making pro-active
investments in the training and education of our employees using a
T-shaped approach. This means that in addition to training in
technical competencies, we are also investing in business know-how
and soft skills.
Financing
The net debt stood at EUR 7.0 million at the end of Q1 2015, an
improvement compared to the first quarter of 2014 (Q1 2014: EUR
12.4 million). When compared to year-end 2014, the net debt
position increased by EUR 16.6 million, largely as a result of
regular seasonal influences (Q4 2014: EUR 9.6 million cash
positive). The ratio of net debt / adjusted EBITDA stood at 0.8
(maximum leverage ratio: less than or equal to 1.50) and the
Interest Cover Ratio stood at 8.6 (minimum interest cover
ratio: more than or equal to 5.0). The ratios are
therefore well within the limits agreed in the bank
covenants.
# # #
ABOUT ORDINA
Ordina is the largest independent IT services provider in the
Benelux. We design, build and maintain IT solutions for
organisations in the public sector, in financial services, industry
and the healthcare sector. We aim to design IT solutions that help
people, IT that matters and that is produced without wasting
precious resources. We do this by forging Partnerships in
Sustainable Innovation with our clients.
Ordina was founded in 1973. The company's shares
have been listed on the NYSE Euronext Amsterdam since 1987 and are
included in the Small cap Index (AScX). In 2014, Ordina recorded
turnover of EUR 367 million. For more information visit the website
at www.ordina.com.
ADDITIONAL INFORMATION
For more information about this press release:
Annemieke den Otter, Investor Relations
Mail: annemieke.den.otter@ordina.nl
Telephone: +31 (0)30 663 7468
Jeroen Hellenberg, Communications
Mail: jeroen.hellenberg@ordina.nl
Telephone: +31 (0)30 663 8557
Jolanda Poots-Bijl, CFO
Mail: jolanda.poots@ordina.nl
Telephone: +31 (0)30 663 8906
Stépan Breedveld, CEO
Mail: stepan.breedveld@ordina.nl
Telephone: +31 (0)30 663 7111
This document contains forward-looking statements
regarding the future financial performance of Ordina N.V. and
outlines certain plans, targets and ambitions based on current
insights. Obviously, such forecasts are not without risk; they
entail a relative degree of uncertainty since there are no
guarantees of future circumstances. There are many factors that
could potentially affect the actual performance, causing this to
deviate from the situation described in this document. Such factors
include: general economic trends, the pace of globalisation in the
solutions, IT and consulting markets, the growing number of
projects with responsibility for deliverables, scarcity on the
labour market and future acquisitions and disposals.
Ordina N.V. results first quarter
2015
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Ordina via Globenewswire
HUG#1916915
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