2017-02-02 07:00:23 CET
2017-02-02 07:00:23 CET
REGULATED INFORMATION
Tieto Oyj - Financial Statement Release
Tieto’s Interim Report 4/2016 – Year of increased investments ends with solid performance
· Strong order intake with fourth-quarter book-to-bill 1.5
· Sales growth 2% in the fourth quarter, IT services up by 3%
· Adjusted operating margin over 12%
· Increased competitiveness driven by investments, continued automation and
efficiency programme
· Dividend of EUR 1.37 proposed
The full interim report with tables is available at the end of this release
Key figures for the fourth quarter
IT services
· Sales growth totalled 2.7%, sales in local currencies up by 3.9%
· Adjusted operating profit amounted to EUR 45.9 (48.6) million, 12.3% (13.4)
of sales
The Group
· Sales growth totalled 2.0%, sales in local currencies up by 3.5%
· Adjusted operating profit amounted to EUR 49.5 (51.4) million, 12.3% (13.0)
of sales
· Order intake (Total Contract Value) at EUR 613 (641) million, order backlog
at EUR 1 847 (2 030) million – book-to-bill 1.5
Key figures for the full year
IT services
· Sales growth totalled 4.3%, sales in local currencies up by 5.3%
· Adjusted operating profit amounted to EUR 141.1 (136.4) million, 10.3%
(10.3) of sales
The Group
· Sales growth totalled 2.2%, sales in local currencies up by 3.2%
· Adjusted operating profit amounted to EUR 152.2 (150.8) million, 10.2%
(10.3) of sales
· Proposed dividend EUR 1.37 per share, including base dividend of EUR 1.15
(1.10) and an additional dividend of EUR 0.22 (0.25), representing dividend
yield of 5.3%
10–12/ 10–12/ 1–12/ 1–12/
2016 2015 2016 2015
Net sales, EUR million 403.6 395.6 1 492.6 1 460.1
Change, % 2.0 -1.8 2.2 -4.1
Change in local 3.5 -2.9 3.2 -2.6
currencies, %
Operating profit (EBITA), 49.0 50.1 154.9 138.0
EUR million(1)
Operating margin (EBITA), 12.1 12.7 10.4 9.5
%
Operating profit (EBIT), 45.1 46.8 140.8 125.2
EUR million(2)
Operating margin (EBIT), % 11.2 11.8 9.4 8.6
Adjusted(2) (3) operating 49.5 51.4 152.2 150.8
profit (EBIT), EUR million
Adjusted(2) operating 12.3 13.0 10.2 10.3
margin (EBIT), %
Profit after taxes, EUR 34.2 34.4 107.2 90.5
million
EPS, EUR 0.46 0.47 1.46 1.23
Net cash flow from 50.2 67.1 97.2 132.6
operations, EUR million
Return on equity, 12-month 22.1 19.0 22.1 19.0
rolling, %
Return on capital 21.6 20.4 21.6 20.4
employed, 12-month
rolling, %
Capital expenditure and 24.7 32.7 99.2 136.7
acquisitions, EUR million
Interest-bearing net debt, 109.7 13.2 109.7 13.2
EUR million
Net debt/EBITDA 0.6 0.1 0.6 0.1
Book-to-bill 1.5 1.6 1.1 1.3
Order backlog 1 847 2 030 1 847 2 030
Personnel on 31 December 13 876 13 083 13 876 13 083
1) amortization of all intangible items; previously, only acquisition-related
intangible items
2) includes EUR 3.3 (1.2) million in allocated acquisition-based amortization in
the full year, EUR 1.1 (0.6) million in the fourth quarter
3) adjusted for restructuring costs, capital gains/losses, goodwill impairment
charges and other items
Full-year outlook for 2017
Tieto expects its adjusted(1) full-year operating profit (EBIT) to increase from
the previous year’s level (EUR 152.2 million in 2016).
1) adjusted for restructuring costs, capital gains/losses, goodwill impairment
charges and other items
CEO’s comment
Comment regarding the interim report by Kimmo Alkio, President and CEO:
“We are pleased to be back to growth and to have ended the year with solid
performance also in terms of order intake and profitability. While our total
revenues for the full year grew by 2% – and by 4% in IT services – our aim is to
grow faster, which is supported by our investments in new services and
technologies.
The IT software and services industry is continuing to undergo significant
change globally, which requires a simultaneous focus on future innovation and
constant productivity improvement in our operations. For example, we have
increased investments in our software products, start-ups and new data-driven
businesses based on artificial intelligence. To enable continued investments in
innovation and growth, we have also decided to take further actions to drive our
competitiveness by continuing to step up automation and growing our less labour
-intensive solutions.
In this rapidly changing world of digitalization, the required skills and
competences are evolving fast. We encourage all our employees to pursue personal
development and actively support everyone to acquire new skills that fit the
market demands. With this in mind we have recently launched a “Learning as a
Lifestyle” initiative for all employees to provide insights on emerging skills
and technologies in the areas of Advanced Analytics, Design Thinking and DevOps
for agile development.
We are excited about the opportunities the world of digitalization brings to
society and our customers, business and employees. With this in mind, we are
looking forward to another exciting year in our continuous renewal and
expansion.”
Financial performance by service line
EUR million Customer Customer Change, % Operating Operating
sales sales profit profit
10–12/ 10–12/ 10–12/ 10–12/
2016 2015 2016 2015
Technology Services 197 196 1 26.2 30.3
and Modernization
Business Consulting 38 34 10 2.0 1.3
and Implementation
Industry Solutions 138 132 4 19.7 20.8
Product Development 31 33 -5 3.3 2.8
Services
Support Functions -6.2 -8.3
and Global
Management
Total 404 396 2 45.1 46.8
Operating margin by service line
% Operating Operating Adjusted(1) Adjusted(1)
margin margin operating operating
10–12/ 10–12/ margin margin
2016 2015 10–12/ 10–12/
2016 2015
Technology Services 13.3 15.5 14.1 15.8
and Modernization
Business Consulting 5.3 3.7 1.8 5.7
and Implementation
Industry Solutions 14.3 15.7 15.5 16.2
Product Development 10.6 8.4 11.3 9.4
Services
Total 11.2 11.8 12.3 13.0
1) adjusted for
restructuring
costs, capital
gains/losses,
goodwill impairment
charges and other
items
Customer sales by industry group
EUR million Customer sales Customer sales Change, %
10–12/ 10–12/
2016 2015
Financial Services 101 92 10
Public, Healthcare and Welfare 135 133 1
Industrial and Consumer Services 137 137 0
IT services 373 363 3
Product Development Services 31 33 -5
Total 404 396 2
M&A impact by service line
Growth, % Organic growth, %
(in local currencies) (in local currencies)
10–12/ 10–12/
2016 2016
Technology Services 2.2 2.2
and Modernization
Business Consulting 11.9 2.0
and Implementation
Industry Solutions 5.0 1.2
IT services 3.9 1.6
Product Development -0.9 -0.9
Services
Total 3.5 1.4
M&A impact by industry group
Growth, % Organic growth, %
(in local currencies) (in local currencies)
10–12/ 10–12/
2016 2016
Financial Services 11.0 5.6
Public, Healthcare and Welfare 2.6 2.4
Industrial and Consumer Services 0.2 -2.0
IT services 3.9 1.6
Product Development Services -0.9 -0.9
Total 3.5 1.4
For further information, please contact:
Lasse Heinonen,
CFO, tel.+358 2072 66329, +358 50 393 4950, lasse.heinonen (at) tieto.com
Tanja Lounevirta, Head of Investor Relations,
tel.+358 2072 71725 (http://callto:tel:+358207271725), +358 50 321 7510,
tanja.lounevirta (at) tieto.com
Press conference for analysts and media will be held at Tieto’s premises in
Espoo, address: Keilalahdentie 2, on 2 February at 11.00 am EET (10.00 am CET,
9.00 am UK time). The results will be presented in English by Kimmo Alkio,
President and CEO, and Lasse Heinonen, CFO.
The conference will be
webcasted (http://webcast.tieto.com/quarterlyreport/?q=020217) and can be viewed
live on Tieto's website (http://www.tieto.com/investors). To join the
conference, attendees need Adobe Flash plugin version 10.1.0 or newer. The
meeting participants can also join a telephone conference that will be held at
the same time. The telephone conference details can be found below.
Telephone conference numbers
Finland: +358 (0)9 7479 0361
Sweden: +46 (0)8 5033 6574
UK: +44 (0)330 336 9105
US: +1 719 457 1036
Conference code: 4404154
To ensure that you are connected to the conference call, please dial in a few
minutes before the start of the press and analyst conference. An on-demand video
will be available after the conference.
Tieto publishes financial information in English and Finnish.
TIETO CORPORATION
DISTRIBUTION
NASDAQ Helsinki
NASDAQ Stockholm
Principal Media
Tieto aims to capture the significant opportunities of the data-driven world and
turn them into lifelong value for people, business and society. We aim to be
customers’ first choice for business renewal by combining our software and
services capabilities with a strong drive for co-innovation and ecosystems.
Headquartered in Finland, Tieto has over 13 000 experts in close to 20
countries. Tieto’s turnover is approximately EUR 1.5 billion and shares listed
on NASDAQ in Helsinki and Stockholm. www.tieto.com
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