Analyst presentation Interim results Amsterdam, 18 August 2016

Transcription

1 Analyst presentation Interim results 2016 Amsterdam, 18 August 2016

2 H Ordina closes first half in profit Stépan Breedveld

3 Ordina closes first half in profit Revenue * Rounded off, in millions of euros Recurring EBITDA** Rounded off, in millions of euros Recurring EBITDA margin** H H H H H H % 6.6% Net profit Rounded off, in millions of euros Net debt Rounded off, in millions of euros Net debt/adjusted EBITDA H H H H H H (3.9) (0.1) 0.6 (0.0) * The number of workable days was 125 in the Netherlands (H1 2015: 123). The number of workable days in Belgium/Luxembourg was 125 (H1 2015: 124). ** Adjusted for redundancy costs (H1 2016: EUR 3.4 mln and H1 2015: EUR 2.9 mln) and the costs of internal investigation (H1 2016: - and H1 2015: EUR 1.4 mln). 3

4 Results Q Revenue * Rounded off, in millions of euros Q Q Recurring EBITDA** Rounded off, in millions of euros Recurring EBITDA margin** Q Q Q Q ,2 87,9 (0,8) 5,2 (0,1)% 5,9% * The number of workable days was 62 in the Netherlands (H1 2015: 60). The number of workable days in Belgium/Luxembourg was 62 (H1 2015: 61). ** Adjusted for redundancy costs (H1 2016: EUR 1.5 mln and H1 2015: EUR 1.6 mln) and the costs of internal investigation (H1 2016: - and H1 2015: EUR 0.3 mln). 4

5 Operational highlights Clients & market Innovation & profile House in order Growth industry, challenging market conditions public sector Gouden DIA for Clockwork and Studystore Cost-saving programme virtually complete Continued strong performance Belgium/ Luxembourg 63 Young Professionals started Debt free at close of first half 5

6 Markets: Public sector Revenue Rounded off, in millions of euros 100 (5.4)% 50 (6.1)% (4.7)% ,5 30, , H H The decline in the public sector levelled out somewhat in the second quarter when compared with the first quarter of 2016; In H1 2016, the biggest drop in revenues compared with H was seen in project and management activities; 0 Q Q Q Q In the longer term, we expect the application of IT to play a decisive role in solving major social issues, the reduction of costs and continued improvement of services. The IT sector can act as a guide for the public sector in this digital transition. 6

7 Markets: Financial services Revenue Rounded off, in millions of euros % % 2.3% , ,6 26,2 0 H H Growth in financial services levelled off slightly in the second quarter; In H1, revenue from the financial services sector increased on the back of the stable performance of sourcing contracts; 0 Q Q Q Q Financial institutions are having to anticipate possibilities in mobile banking ever more quickly and are investigating new business models. On this front, Ordina is active with the Building the new bank, and is investigating what the bank of the future will look like with the aid of new technologies. 7

8 Markets: Industry Revenue Rounded off, in millions of euros % % 11.7% , ,2 23,5 0 H H Q Q Q Q Revenue was higher in the second quarter and in the first half. Revenue in the telecom and energy sectors in the Netherlands declined, but a strong increase in revenue from logistics clients led to overall growth in this market segment; The digitalisation of client services and application management, the adjustment of business models and cooperation in the IT eco system are creating opportunities in this market segment. 8

9 Markets: Healthcare Revenue Rounded off, in millions of euros % % 39.8% ,3 4,2 4,5 0 H H Q Q Q Q Revenues were higher in the second quarter, driven largely by increasing demand in the Belgian pharmaceutical sector for specialists in the fields of IT-security and compliance consultancy; In the Netherlands, demand continued to decline in H1; We are targeting the care market and other markets, for instance through the implementation of electronic dossiers and the application of innovative technology to further improve service levels and increase client focus. 9

10 Cost-saving programme virtually complete In 2015, Ordina announced a cost-saving programme targeting structural annual cost-savings of around EUR 15.0 million. This programme included measures to reduce both direct and indirect costs to implement process improvements; The impact of the cost-saving programme on the H1 results amounted to EUR 5.9 million and will amount to around EUR million in the full year 2016; Ordina had already achieved cost savings of EUR 1.5 million in This combined with the figure of around EUR million realised in 2016, plus the remaining amount of EUR million in 2017 means Ordina will have realised the programme s target of EUR 15.0 million. 10

11 Revenue share top 10 clients Revenue share top-10 clients In % H H * H H H TOP 10 CLIENTS (in alphabetical order) Johnson & Johnson** Ministry of Home Affairs Ministry of Economic Affairs Ministry of Finance** Ministry for Infrastructure and Environment Ministry for Education, Culture and Science Ministry for Social Affairs and Employment Police force Philips Rabobank * Offshore component Rabobank contract 10.9 mln = 5,5%. ** Johnson & Johnson and the Ministry of Finance are new/back in the top 10 and have replaced the European Commission and ING Group. 11

12 Contracts H Public sector Framework Agreement Service desk with the police force. Supplying a DevOps team for a ministry; the team will be deployed for various products and systems. Extension of various application management & outsourcing contracts, including those in the public sector. Financial services Successful execution of a complicated migration of a mortgage portfolio for a financial services provider. Development of a payment app for a major financial institution. The app enables consumers in a virtual group to make payments, monitor spending and settle up with each other. Development and connection of the BankID system for a major financial institution. Industry Providing cloud and database services for AgroEnergy. Development of NS PAS application to provide support for those who require special assistance on platforms. Energieonderzoek Centrum Nederland (ECN) has extended technical application management contract. Healthcare Extension outsourcing contract with Stichting Dichterbij. Realisation of a pilot application that enables patients to perform rehabilitation exercises using a sensor glove; these exercises can be analysed online by the patient s physician. Development. of dental software by a team of UX experts at a medical company 12

13 Our employees Changes in number of direct FTEs Changes in number of indirect FTEs H Q FY 2015 Q H Q Q FY 2015 Q Q Number of direct employees fell by 116 FTEs in H1 2016; a total of 216 FTEs joined the company, with 63 of these Young Professionals; Average productivity stood at 70.2% and availability was 9.1%; Employee turnover was 26.1% in H (H1 2015: 16.5%), with around a third of this at the request of the employer. Number of indirect employees fell by 19 FTEs in H1 2016; Number of indirect FTEs has been reduced as part of the cost-saving programme and will be reduced further in H

14 Trend analysis employee engagement Employee engagement 6,6 6,2 6,7 6,4 6,5 >7 5,4 5,6 5, The annual employee engagement survey will be conducted in Q3 2016; Our ambition is to achieve a minimum employee engagement score of

15 Financial performance H Jolanda Poots-Bijl

16 Revenue (Rounded off, in millions of euros) H1 2015* H Growth % Revenue In % Revenue The Netherlands 25 The Netherlands (1.8)% Professional Services (0.1)% Consulting (9.9)% Application Management % Innovation cluster (10.9)% Belgium / Luxembourg % Total % Belgium / Luxembourg The Netherlands Belgium / Luxembourg 75 H * 2015 figures have been adjusted in line with the new organisational structure for comparison purposes. H

17 REBITDA (Rounded off, in millions of euros) H1 2015* H REBITDA In % REBITDA The Netherlands % % The Netherlands 45 Belgium / Luxembourg 55 Professional Services % % Consulting (0.6) (4.1)% % Application Management % % Innovation cluster (0.3) (2.0)% (0.7) (6.4)% Belgium / Luxembourg % % Total % % * 2015 figures have been adjusted in line with the new organisational structure for comparison purposes. The Netherlands Belgium / Luxembourg H H

18 Development REBITDA margin REBITDA margin H versus H In % % 11.3% 8.3% H % 4.0% Ordina H1 2016: 6.6% H1 2015: 1.9% 0 1.1% 1.1% -2.0% Professional Services % -6.4% Consulting Application Management Innovation cluster -10 Belgium / Luxembourg 18

19 Income statement (Rounded off, in millions of euros) Net revenue Purchase value HWSW and other costs Work contracted out Personnel costs Redundancy costs Depreciations on tangible and intangible fixed assets Other operating expenses Total operating expenses Operating result (EBIT) (3.7) 5.6 Interest expenses & results participations (0.3) (0.3) Earnings before tax (EBT) (4.0) 5.3 Taxes 0.1 (2.4) Net profit (3.9) 3.0 In the first half of the year, the net result improved by EUR 6.9 mln compared with the same period of last year. This was largely driven by the cost-saving programme and the strong performance in Belgium/Luxembourg. Personnel costs fell by EUR 3.6 mln. This was due to the lower number of FTEs employed. Redundancy payments amounted to EUR 3.4 mln, and were EUR 0.5 mln higher than in H The redundancy payments are expected to amount to around EUR 6-7 mln in the full year

20 Changes in net cash position year-end 2015 H Changes net cash position H Rounded off, in millions of euros Net cash 31 December 2015 Net profit Depreciation Working cap., Provisions & other Interest & tax Net investments Net cash 30 June 2016 The improvement in net debt was driven by improved returns and intensive working capital management Balance end period Decrease net debt Increase net debt 20

21 Balance sheet (Rounded off, in millions of euros) 30 June June June June 16 Assets Liabilities Intangible fixed assets Tangible fixed assets Financial fixed assets Total fixed assets Shareholders equity Bank debts / term loan Personnel-related provisions Provision vacant offices Deferred tax liabilities Trade and other receivables Transition costs Cash and cash equivalents Assets held for sale Total long-term debts Bank debts Other provisions Trade and other payables Corporate income tax due Total current assets Total short-term debts Total liabilities Total assets Total shareholders equity and liabilities Ordina has tax-loss carry forwards. In connection with these tax-loss carry forwards, Ordina has recognised a deferred tax claim in its balance sheet. At the point in the future when it is no longer possible to fully offset said tax-loss carry forwards, there is a risk that a portion of the tax-loss carry forwards will have to be amortised. In the second half of this year, Ordina will complete the measures required for the renewal of tax losses. 21

22 Financing: net debt position H H Financing agreement Net debt at end period (in EUR millions) 6.1 (0.1) Leverage ratio 0.6 (0,0) =< 2.5 Interest Cover Ratio >= 4.0 The financing agreement closed in May 2015 has a term of five years, with an initial term of three years and an option to extend twice for a period of one year. In July 2016, Ordina agreed the first extension of one year to May 2019 under the same conditions. 22

23 Management agenda Key priorities Stépan Breedveld

24 IT is playing an ever greater role in our society Current business themes: Advent of digital business models Shift in retail market Robotisation and employment Transformation in healthcare and finance Security & privacy Efficient public sector and selfreliance citizens 24

25 What we believe in We believe that IT should work for people IT can and must play a decisive role in solving major social issues Ordina dedicates itself to this effort every single day and helps organisations to adapt continuously to their changing environment 25

26 Ordina s strategy Thanks to the humanisation of IT, human needs are merging with technology (vision) This is why we work with our clients on sustainable innovations that help people to move forward (mission) We help our clients to adapt continuously to their changing environment We accelerate the innovative potential of our clients by applying technology that is secure and robust and that works intuitively for users 26

27 Ordina s goals Growth through focus on clients in the Benelux High-quality services and very high levels of engagement with clients: Ordina promoter score minimum of 70 Healthy returns: recurring EBITDA margin of 10% Engaged employees: Employee engagement minimum of 7.0 Socially responsible and sustainable business 27

28 Management agenda Growth : Boost revenues by increasing added value Simplicity: Increase efficiency by simplifying the organisation and processes Investments : in people and innovation 28

29 Renewal and innovation Short-cycle collaboration Rejuvenation, T-shape Flexible and scalable Innovative technology Customer Experience Data driven organisation Cyber security Digital identity and privacy Cloud navigation 29

30 National government: online platform Ordina makes a significant contribution to the Platform Rijksoverheid Online (PRO). This platform is the central location where national government organisations can have websites made quickly and easily. Hosting, professional management and support services are safeguarded in this context Since January 2014, more than a hundred government websites and online magazines have been developed and gone live on this platform. Ordina is responsible for the continued development and functional management of the platform. Ordina also provides training for editors if new functionalities become available. 30

31 Share the bill with GRPPY Ordina has developed the mobile payment app GRPPY for Rabobank. GRPPY enables consumers to make group payments and settle up with each other. The principle is remarkably simple. Everyone puts money into a virtual group kitty using the ideal payments system and uses Shift to indicate who has spent money, when this was paid and what it was for. GRPPY does the rest, divides the bill fairly among the group members, asks them to deposit money if necessary and pays back any excess amounts paid. 31

32 Controlling mobile initiatives Mobile applications are extremely useful for Dutch Rail NS employees because they help them to do their work anywhere. But what can you do as an organisation to stay on top of all kinds of mobile initiatives and how do you prevent the development of all kinds of apps within the NS organisation that all serve exactly the same purpose? NS came to Ordina with these questions. The assignment was to bundle all mobile initiatives in one central contact point: the NS Competence Center Mobile. Shortly after, an organisation was set up that is responsible for the coordination and realisation of all mobile initiatives for NS employees and makes sure that these are converted into uniform and recognisable mobile applications. 32

33 Two-tier approach at SVB The Sociale Verzekeringsbank (SVB) is responsible for social security payments, such as the AOW retirement pension, and child benefits. Obviously, the reliability and continuity of the SVB s services are paramount. The SVB s existing systems are the backbone of its task. They ensure that citizens receive their social security payments on time and in the correct amount. At the same time, the SVB is faced with the challenge of creating a future-proof organisation that can respond flexibly to new digital developments. That requires a two-tier approach. Ordina supplies the SVB with a team of 10 Cobol experts. Together with their SVB peers, this team takes care of the continuity of the SVB s primary systems and the extension of their life, as well as coaching in the field of required innovations. 33

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35 Ordina Shareholder Day 12 October

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