2010-08-24 08:00:00 CEST
2010-08-24 08:02:41 CEST
REGULATED INFORMATION
Solteq Oyj - Interim report (Q1 and Q3)
SOLTEQ PLC'S INTERIM REPORT 1.1.-30.6.2010
Solteq Plc Stock Exchange Bulletin 24.8.2010 at 9.00am
- Total revenue decreased by 13,2 % and totalled 12,8 million euros (14,7
million euros)
- Operating result totalled -2.177 thousand euros (225 thousand euros)
- In 2010 the total revenue is expected to decrease by 5-10 % compared to
2009 and the operating result is anticipated to remain negative.
- Earnings per share was -0,14 euros (0,01 euros)
KEY FIGURES
Turnover by operation:
% 1-6/10 1-6/09 1-12/09
Softwareservices 68 63 65
Licences 25 27 26
Hardware 7 10 9
BUSINESS ENVIRONMENT AND BUSINESS DEVELOPMENT
Solteq is a strategic partner for trade and industry, whose core competency is
IT solutions that are critical to business. Solteq combines its own product
portfolio with the products from the leading software companies in the world to
deliver individual business development and ERP solutions for its customers. The
information that is processed by means of these solutions is helping customers
to manage their business even better than before and to improve their
profitability.
Starting from 1.1.2010 Solteq's operations was divided into four business areas
and the result of the company is monitored through these areas. Business areas
are: ERP (enterprise resource planning), EAM (enterprise asset management), Data
(data management and integration) and Store (retail solutions and technology).
During the first half of 2010 Solteq's revenue totalled 12.759 thousand euros
which contains decrease of 13,2 per cent compared to corresponding period in
2009.
Solteq's operating result for the first half decreased to -2.177 thousand euros
from 225 thousand euros that was the operating result in the corresponding
period 2009. Company's operating profit percentage was -17,1 % during the first
half (1,5 % in 2009).
Both the turnover and operating profit for the first half were clearly worse
than estimated. The main reasons for the unsatisfactory development were slower
than excepted progression of some significant customer projects and the higher
than expected volume of purchased subcontracting services.
Neither did the demand develop steadily in different business areas. As a result
of the varying demand Solteq started the reorganization activities during the
review period. The outcome of this was 17 notices of termination and other cost
saving actions. The salaries including social costs for the termination period,
total 430 thousand euros, have been presented in the review period.
ERP
Solteq's business area ERP offers to its clientele enterprise resource planning
systems and supporting optimization and reporting solutions as well as a set of
other different added value solutions. These solutions help customers to lead
their operations and to intensify their operations e.g. purchases, sales and
warehouse management as well as reporting. Wide group of customers among others
in business branches trade, industry, auto trade and public sector are using
these solutions every day.
The revenue of business area ERP totalled 8,3 million euros. Business area's
operating result was -1,1 million euros
EAM
Solteq's EAM-solutions include systems for maintenance management, asset
management optimization, fieldwork management and maintenance. By means of these
solutions Solteq's customers are able to anticipate the need for service of
production lines and machines as well as they are able to monitor the
malfunction history and control the machinery maintenance related material flows
from purchasing to warehousing. The clientele consists of among others energy-
and production plants, companies in processing and engineering industries as
well as maintenance related service sector.
During the review period the revenue of business area EAM totalled 1,7 million
euros and operating result was -0,4 million euros.
Data
Solteq's business area Data is responsible for services and products relating to
the data (i.e. masterdata) that is crucial to the customers' businesses as well
as e-commerce and integration technologies. Solteq offers to its customers
masterdata related quality improvement projects, data maintenance services in
which the services are outsourced to masterdata service centers, software
technologies and consultancy services that can be utilized in masterdata
management. The aim of these services is to ensure that the data that is stored
in the programs, which support customers' enterprise resource planning and
decision-making, is high-quality, compatible and up to date.
During the review period the revenue of business area Data totalled 0,9 million
euros and operating result was -0,4 million euros
Store
The solutions of Solteq's business area Store intensify the purchases, sales and
customer relationship management of specialty stores and chained commerce. Every
day hundreds of retailers, entrepreneurs and salespersons are leading their
businesses and serving their customers in thousands of store locations by means
of these solutions.
The revenue of business area Store totalled 1,9 million euros and operating
result was -0,3 million euros during the review period.
REVENUE AND RESULT
Revenue decreased by 13,2 % compared to the previous year and totalled
12.759 thousand euros (previous financial year 14.704 thousand euros).
Revenue consists of several individual customerships. At the most, one client
corresponds to a less than ten percentages of the revenue
The operating result for the review period was -2.177 thousand euros (225
thousand euros), result before taxes was -2.264 thousand euros (157 thousand
euros) and the loss for the review period -1.702 thousand euros (95 thousand
euros).
BALANCE SHEET AND FINANCING
The total assets amounted to 20.694 thousand euros (22.218 thousand
euros). Liquid assets totalled 119 thousand euros (319 thousand euros).
Solteq Group's interest-bearing liabilities were 7.998 thousand euros (6.737
thousand euros).
Solteq Group's equity ratio was 35,9 percent (41,1 %).
INVESTMENTS, RESEARCH AND DEVELOPMENT
Gross investments during the review period were 71 thousand euros (485 thousand
euros).
Research and development
Solteq's research and development costs consist mainly of personnel costs. When
developing basic products, it is Solteq's strategy to cooperate with global
actors such as SAP and Microsoft and utilize their resources and distribution
channels. Own development efforts are focused on added value products and
tailored service concepts.
During the review period the company has not capitalized development costs. The
amortization according to plan has been started relating to the development
project that was finalized at the end of previous financial period. During the
first half of 2009 the development costs capitalized under IFRS were 285
thousand euros.
PERSONNEL
The number of permanent employees at the end of the review period was 240 (245).
Average number of personnel during the review period was 238 (253). In the end
of the review period the number of personnel could be divided in accordance with
the profit centers that were established on 1.1.2010 as follows: ERP 118, EAM
41, Data 27 and Store 30 and Shared Functions 24.
RELATED PARTY TRANSACTIONS
Solteq's related parties include Solteq's board of directors, managing director
and the Group's management team. There have been no significant changes in the
company's related party transactions since the financial statements 2009.
SHARES, SHAREHOLDERS AND TREASURY SHARES
Solteq Plc's share capital on 30.6.2010 was 1.009.154,17 euros which was
represented by 12.148.429 shares. The shares have no nominal value.
In the end of the review period the amount of treasury shares in Solteq Plc's
possession was 340.886 shares. The amount of treasury shares represented 2,81 %
from the total amount of shares and votes in the end of the review period. The
equivalent value of acquired shares was 28.317 euros.
Exchange and rate
During the review period, the exchange of Solteq's shares in the
Helsinki Stock Exchange was 0,5 million shares (0,2 million shares) and
0,7 million euros (0,3 million euros). Highest rate during the review period was
1,56 euros and lowest rate 1,09 euros. Weighted average rate of the share was
1,32 euros and end rate 1,11 euros. The market value of the company's shares in
the end of the review period totalled 13,5 million euros (15,2 million euros).
Ownership
In the end of the review period, Solteq had a total of 1.987 shareholders (1.984
shareholders). Solteq's 10 largest shareholders owned 8.327 thousand shares i.e.
they owned 68,5 per cent of the company's shares and votes. Solteq Plc's members
of the board owned a total of 5.179 thousand shares which equals 42,6 per cent
of the company's shares and votes.
ANNUAL GENERAL MEETING
Solteq Plc's annual general meeting on 26.3.2010 adopted the financial
statements for 2009 and the members of the board and the managing director were
discharged from liability for the financial year 2009.
The annual general meeting decided in accordance with the board's proposal to
distribute a dividend in the amount of 0,06 euros per share. The reconciliation
date for the dividend was 31.3.2010 and payment date 9.4.2010.
The annual general meeting decided to authorize the board of directors to decide
on acquiring the company's own shares so that the amount in
the possession of the company does not exceed 10 percent of the company's total
shares at that moment. The shares can be acquired in order to develop the
company's capital structure, finance and execute acquisitions or similar
arrangements or used as part of the incentive scheme of the personnel or convey
otherwise or be invalidated. The shares can be acquired in other proportion than
the shareholders' holdings. The shares are to be acquired through public
trading. The authorization is valid until the next annual general meeting.
The annual general meeting decided in accordance with the board's proposal to
amend the section 11 of the articles of association so that notice to the
general meeting shall be issued no later than three weeks before the date of the
general meeting, however at least nine days before the record date of the
general meeting. Furthermore, the articles of association was amended so that
the notice to the general meeting can alternatively be delivered, in addition to
the current manners, by publishing the notice on the company's website.
BOARD OF DIRECTORS AND AUDITORS
Six members were elected to the board of directors of the company. Seppo Aalto,
Veli-Pekka Jokiniva, Ali Saadetdin, Jukka Sonninen and Markku Pietilä will
continue as members of the board. Sirpa Sara-aho was elected as new member of
the board of directors. The board elected Ali Saadetdin to act as the chairman
of the board.
KPMG Oy Ab, Authorized Public Accountants, were re-elected as Solteq's auditors.
Frans Kärki, APA, acts as the lead partner.
EVENTS AFTER THE REVIEW PERIOD
Solteq Plc issued a stock exchange bulletin on 8.7.2010, where the Board of
Directors informed that they had elected Repe Harmanen as Managing Director of
the company.
Prior to the release of this Interim report, the starting time of the new
Managing Director is confirmed to be Monday 20.9.2010.
RISKS AND UNCERTAINITIES
The key uncertainties and risks in short term are related to the timing and
pricing of the business deals that are the basis for the revenue, changes in the
level of costs and the company's ability to manage extensive contract agreements
and deliveries.
The key business risks and uncertainties of the company are monitored constantly
as a part of the board of directors' and management team's work. The company has
not organized a separate internal audit organization or committee.
PROSPECTS
In 2010 the total revenue is expected to decrease by 5-10 % compared to 2009 and
the operating result is anticipated to remain negative.
Financial Reporting
The interim report has been prepared in accordance with the International
Financial Reporting Standards ("IFRS"). The same accounting policies and methods
of computation are followed in the interim report as were followed in the
financial statements of Solteq Plc for 2009.
The financial result is reported through four business areas. The business area
ERP includes systems for finance and enterprise resource planning. Business area
EAM consist of asset management optimization, material management and
maintenance management systems. Data business area includes tools for data
collection, assurance of data's quality and accuracy as well as tools for data
integration between different systems. Business area Store includes
point-of-sale and store management systems. The most essential product and
service types of Solteq group of companies are software services, licenses and
hardware sales.
All forecasts and estimates presented in the interim report are based on the
current views of the management on the economic environment and outlook. Results
can differ from those implied as a result of, among other factors, changes in
economy, markets and competitive conditions, changes in the regulatory
environment and other government actions.
The interim report is unaudited.
FINANCIAL INFORMATION
GROUP PROFIT AND LOSS ACCOUNT
(TEUR)
1.4.- 1.4.- 1.1.- 1.1.- 1.1.-
30.6.2010 30.6.2009 30.6.2010 30.6.2009 31.12.2009
NET TURNOVER 6 591 7 495 12 759 14 704 28 550
Other operating
income 1 77 12 78 94
Raw materials and
services -1 687 -2 085 -3 465 -4 003 -7 524
Staff expenses -4 730 -3 781 -8 854 -8 011 -14 868
Depreciation -213 -177 -424 -350 -710
Other operating
expenses -1 120 -1 114 -2 205 -2 193 -4 078
OPERATING RESULT -1 158 415 -2 177 225 1 464
Financial income and
expenses -40 -18 -87 -68 -135
RESULT BEFORE TAXES -1 198 397 -2 264 157 1 329
Income taxes 298 -113 562 -62 -394
RESULT FOR THE PERIOD
-900 284 -1 702 95 935
OTHER ITEMS OF TOTAL COMPREHENSIVE INCOME
Cash flow hedging -4 0 -46 0 -9
Other items of total comprehensive income
after taxes -3 0 -34 0 -7
TOTAL COMPREHENSIVE INCOME
-903 284 -1 736 95 928
Total profit for the period attributable to
Owners of the parent -900 284 -1 702 95 935
Total comprehensive income attributable to
Owners of the parent -903 284 -1 736 95 928
Earnings / share,
e(undiluted) -0,08 0,03 -0,14 0,01 0,08
Earnings / share,
e(diluted) -0,08 0,03 -0,14 0,01 0,08
Taxes corresponding to the result have been presented as taxes
for the period.
GROUP BALANCE SHEET (TEUR) 30.6.2010 30.6.2009 31.12.2009
ASSETS
NON-CURRENT ASSETS
Intangible assets
Intangible rights 2 567 2 751 2 755
Goodwill 8 286 8 286 8 286
Tangible assets 2 648 2 676 2 645
Investments
Other shares and similar
rights of ownership 93 93 93
Deferred tax
assets 437 207 0
Other receivables 159 0 0
Total non-current
assets 14 190 14 013 13 779
CURRENT ASSETS
Short-term debtors 6 385 7 886 7 093
Cash in hand and at banks 119 319 258
Total current
assets 6 504 8 205 7 351
TOTAL ASSETS 20 694 22 218 21 130
EQUITY AND LIABILITIES
CAPITAL AND RESERVES ATTRIBUTABLE TO THE SHAREHOLDERS
OF THE PARENT COMPANY
Share capital 1 009 1 009 1 009
Company's own shares -438 -337 -337
Share premium account 75 75 75
Account for cash flow
hedging -41 0 -7
Unrestricted equity
fund 7 214 7 214 7 214
Retained earnings 1 307 1 084 1 084
Result for the
financial period -1 702 95 935
Total equity 7 424 9 140 9 973
Non-current liabilities
Deferred tax liabilities 0 0 125
Other non-current liabilities 3 703 3 163 4 337
Current liabilities 9 567 9 915 6 695
Total liabilities 13 270 13 078 11 157
TOTAL EQUITY AND
LIABILITIES 20 694 22 218 21 130
FINANCIAL PERFORMANCE
INDICATORS (IFRS) 1-6/2010 1-6/2009 1-12/2009
Net turnover MEUR 12,8 14,7 28,6
Change in net turnover -13,2 % -4,8 % -6,0 %
Operating result MEUR -2,2 0,2 1,5
% of turnover -17,1 % 1,5 % 5,1 %
Result before taxes MEUR -2,3 0,2 1,3
% of turnover -17,7 % 1,1 % 4,7 %
Equity ratio, % 35,9 41,1 47,2
Gearing, % 106,2 % 70,2 % 66,7 %
Gross investments in
non-current assets MEUR 0,1 0,5 0,7
Return on equity, % -41,5 % 2,1 % 9,6 %
Return on investment, % -27,9 % 3,1 % 9,1 %
Personnel at end of
period 240 245 235
Personnel average
for period 238 253 240
KEY INDICATORS PER SHARE
Earnings / share, e -0,14 0,01 0,08
Earnings / share,
e(diluted) -0,14 0,01 0,08
Equity / share, e 0,63 0,77 0,84
SEGMENT INFORMATION
Turnover by segment:
Me 1-6/10 1-6/09 Change
ERP 8,3 10,6 -2,3
EAM 1,7 2,1 -0,4
DATA 0,9 0,5 +0,4
STORE 1,9 1,5 +0,4
Total 12,8 14,7 -1,9
Operating result by segment:
Me 1-6/10 1-6/09 Change
ERP -1,1 0,7 -1,8
EAM -0,4 0,0 -0,4
DATA -0,4 -0,7 +0,3
STORE -0,3 0,2 -0,5
Total -2,2 0,2 -2,4
Because of the change in organisation, the respective segment information of
2009 has been allocated from the bookkeeping retroactively.
QUARTERLY KEY INDICATORS (MEUR)
3Q/08 4Q/08 1Q/09 2Q/09
Net turnover 6,29 8,65 7,21 7,49
Operating result 0,38 0,66 -0,19 0,41
Result before taxes 0,30 0,58 -0,24 0,40
3Q/09 4Q/09 1Q/10 2Q/10
Net turnover 5,62 8,23 6,17 6,59
Operating result 0,46 0,78 -1,02 -1,16
Result before taxes 0,42 0,75 -1,07 -1,20
CASH FLOW STATEMENT (MEUR)
1-6/2010 1-6/2009 1-12/2009
Cash flow from business
operations -0,35 0,25 0,18
Cash flow from capital
expenditure -0,07 -0,49 -0,65
Cash flow from financing activities
Dividend distribution -0,71 -0,48 -0,48
Own shares -0,10 -0,08 -0,08
Loan agreement 1,09 0,42 0,59
Cash flow from financing
activities 0,28 -0,14 0,03
Change in cash and cash
equivalents -0,14 -0,38 -0,44
TOTAL INVESTMENTS (TEUR)
1-6/2010 1-6/2009 1-12/2009
Continuing operations,
group total 71 485 651
LIABILITIES (MEUR) 30.6.2010 30.6.2009 31.12.2009
Company quorantee for
credit limits 2,61 1,18 2,61
Perfomance bonds 0,05 0,02 0,05
Lease contracts, machinery &
equipment 0,62 0,60 0,70
Lease liability,
premises 2,00 2,31 2,21
Pledged shares 1,59 0,00 1,59
MAJOR SHAREHOLDERS JUNE 30, 2010
Shares and votes
Number %
1. Saadetdin Ali 3 481 383 28,7
2. Aalto Seppo 1 662 206 13,7
3. Profiz Business Solution Oyj 1 384 823 11,4
4. TP-Yhtiöt Oy 513 380 4,2
5. Roininen Matti 350 000 2,9
6. Solteq Oyj 340 886 2,8
7. Hakamäki Jorma 228 430 1,9
8. Saadetdin Katiye 156 600 1,3
9. Halmet Jarmo 106 250 0,9
10. Aukia Timo 103 230 0,8
10 largest shareholders total 8 327 188 68,5 %
Total of nominee-registered 84 646 0,7 %
Others 3 736 595 30,8 %
Total 12 148 429 100,0 %
STATEMENT OF CHANGES IN GROUP EQUITY (TEUR)
A=Share capital
B=Company's own shares
C=Share premium account
D=Account for cash flow hedging
E=Unrestricted equity fund
F=Retained earnings
G=Total
A B C D E F G
EQUITY 1.1.2009 1 009 -255 75 0 7 213 1 560 9 602
Total comprehensive income 95 95
Acquiring of own shares -82 -82
dividend distribution -475 -475
EQUITY 30.6.2009 1 009 -337 75 0 7 213 1 180 9 140
EQUITY 1.1.2010 1 009 -337 75 -7 7 213 2 020 9 973
Total comprehensive income -34 -1 702 -1 736
Acquiring of own shares -101 -101
dividend distribution -712 -712
EQUITY 30.6.2010 1 009 -438 75 -41 7 213 -394 7 424
CALCULATION OF FINANCIAL RATIOS
Solvency ratio, in percentage
equity x 100
----------------------------------
balance sheet total - advances received
Gearing
interest bearing liabilities - cash,
bank balances and securities X 100
-------------------------------------------
equity
Return on Equity (ROE) in percentage
profit or loss before taxation - taxes x 100
----------------------------------------
equity
Profit from invested equity in percentage
profit or loss before taxation +
interest expenses and other financing expenses x 100
----------------------------------------
balance sheet total - non-interest bearing
liabilities
Earnings per share
pre-tax result - taxes
+/- minority interest
------------------------------------
diluted average share issue
corrected number of shares
Diluted earnings per share
diluted profit before taxation -
taxes +/- minority interest
-----------------------------------------------
diluted average share issue
corrected number of shares
Equity per share
equity
-----------------------
number of shares
Financial Reporting
Solteq Plc's financial information bulletins in 2010 have been scheduled as
follows:
- Interim report 1-9/2010 Wednesday 3.11.2010
More investor information on Solteq's website at www.solteq.com
Additional information:
Chairman of the Board of Directors Ali U. Saadetdin
Telephone +358 20 1444 201 or +358 40 8444 201
E-mail ali.saadetdin@solteq.com
(Acting) Managing Director, CFO Antti Kärkkäinen
Telephone +358 20 1444 393 or +358 40 8444 393
E-mail antti.karkkainen@solteq.com
Distribution:
NASDAQ OMX Helsinki
Key Media
[HUG#1439600]
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