Third quarter evry.com

Transcription

1 Third quarter 2013 evry.com

2 About EVRY EVRY is one of the leading IT companies in the Nordic countries, with a strong local and regional presence in 50 Nordic towns and cities. Through its knowledge, solutions and technology, EVRY contributes to the development of the information society of the future, and so creates value for the benefit of its customers and for society as a whole. EVRY combines in-depth industry knowledge and technological expertise with a local delivery model and international strength. EVRY has some 10,000 employees, and the company is committed to demonstrating that Nordic customers are best served by a supplier that understands Nordic business from the inside. EVRY reports annual turnover approaching NOK 13 billion. EVRY ASA is listed on the Oslo Stock Exchange with ticker code EVRY and operates from headquarters at Fornebu, with major activities in both the Norwegian and Swedish markets.

3 Highlights of the Third quarter of 2013 Operating revenue NOK 2,863 million, an organic decline of 2% from the third quarter of 2012 EBITA of NOK 197 million, an increase of 10% from the third quarter of 2012 Improvement in EBITA for the segments EVRY Norway and EVRY Financial Services Cash flow from operations NOK 232 million (NOK 171 million for the third quarter of 2012) - Free cash flow of NOK 380 million last four quarters (NOK 33 million) Key figures NOK million Q Q3 2012* * 2012* Operating revenue 1) Operating costs Operating profit bef. depr. and non-recurring items (EBITDA) Depreciation Operating profit bef. amort. and non-recurring items (EBITA) EBITA % 6,9 % 6,2 % 5,6 % 5,0 % 5,4 % EBIT before non-recurring items Non-recurring items EBIT Net financial items Profit before tax Cash flow from operations before restructuring Operational investment (CAPEX) EPS before non-recurring items (NOK) 0,44 0,26 1,03 0,73 1,16 EPS (NOK) 0,37 0,26 0,94 0,74 0,60 No. of employees * Restated figures due to implementation of IAS 19 Employee Benefits with effect from 1 January ) The term organic growth is defined as follows: Change in revenue corrected for acquisitions and disposals of businesses, and corrected for movements in exchange rates.

4 4 Quarterly report Third quarter 2013 Highlights of the third quarter of 2013 The group reported operating revenue for the third quarter of 2013 of NOK 2,863 million, equivalent to a drop in organic revenue of 2% relative to the third quarter of The group s revenue was adversely affected by the previously communicated reduction in revenue generated by IT Operations from the large customer market in Norway (excluding the banking sector), which accounted for -2 percentage points of the group s total change in revenue in the third quarter of The EVRY Financial Services segment reported a 12% increase in revenue in the third quarter of 2013, while the EVRY Sweden and EVRY Norway segments reported reductions in revenue of 6% and 5% respectively. The group s order backlog amounted to NOK 14.2 billion at 30 September 2013, down by NOK 0.9 billion from the close of the second quarter of The group reported operating profit before amortisation of intangible assets and before non-recurring items (EBITA) for the third quarter of 2013 of NOK 197 million, as compared to NOK 179 million for third quarter of EBITA margin for the third quarter of 2013 was 6.9% compared to 6.2% for the third quarter of The EVRY Financial Services segment reported EBITA of NOK 95 million for the third quarter of 2013, an increase of NOK 4 million from the third quarter of The EVRY Sweden segment reported EBITA for the third quarter of 2013 of NOK 43 million, a fall in profit of NOK 5 million due principally to continuing difficult market conditions in Sweden. The EVRY Norway segment reported EBITA of NOK 94 million, equivalent to an improvement in profit of NOK 6 million. Depreciation was NOK 108 million for the third quarter of 2013 compared to NOK 109 million in the third quarter of Of this, depreciation of software developed in-house accounted for NOK 9 million, in line with the third quarter of Amortisation of other intangible assets amounted to NOK 8 million in the third quarter of 2013, as compared to NOK 13 million in the third quarter of Investment in operational fixed assets totalled NOK 156 million in the third quarter of 2013 compared to NOK 126 million in the third quarter of Investment in software developed in-house amounted to NOK 27 million in the third quarter of 2013 compared to NOK 22 million in the third quarter of As the company has previously communicated, investment in operational fixed assets is higher in 2013 than in 2012 as the result of the Future Proof program. The operating result for the third quarter of 2013 before non-recurring items (EBIT) was a profit of NOK 189 million compared to a profit of NOK 167 million in the third quarter of Non-recurring costs of NOK 24 million were recognised in the third quarter of As communicated in connection with the second quarter 2013 report, a streamlining initiative has been launched in EVRY Financial Services in order to improve efficiency in the segment s value chains and further improve profit margins. In connection with this initiative, a provision has been recognised for the cost of headcount reductions in this segment. In addition, other provisions were made in the third quarter of 2013 for the cost of headcount reductions carried out in the Swedish activities to adapt to the market situation. There were no non-recurring costs in the third quarter of The operating result (EBIT) for the third quarter of 2013 was a profit of NOK 165 million compared to a profit of NOK 167 million in the third quarter of Net financial expenses were NOK 27 million in the third quarter of 2013 compared to NOK 43 million in the third quarter of Net interest expense was NOK 46 million in the third quarter of 2013, down by NOK 4 million from the third quarter of The reduction is the result of lower interest rates, the expiry of former interest rate fixing agreements and a lower level of borrowings than in the third quarter of There was a net positive currency effect of NOK 13 million in the third quarter of 2013, as compared to a net positive currency effect of NOK 6 million in the third quarter of Pre-tax profit (EBT) for the third quarter of 2013 was NOK 138 million compared to NOK 123 million for the third quarter of Earnings per share for the third quarter of 2013 was NOK 0.37 as compared to NOK 0.26 for the third quarter of After adjusting for non-recurring items, earnings per share for the third quarter of 2013 was NOK The group s headcount at 30 September 2013 was 10,305 compared to 9,827 at the end of September The increase in headcount relates particularly to the group s global sourcing activities in the Ukraine and India, where employee numbers have increased by 532 since the end of September 2012.

5 Quarterly report Third quarter The Group s segments EVRY Financial Services segment EVRY Financial Services offers a broad portfolio of solutions and services, and is a complete industry vertical with responsibility for all the company s deliveries to bank and finance customers. The segment offers a comprehensive portfolio of solutions to support banks in their management of continuous change and facilitate the next generation of banking services, and this portfolio is subject to a continuous program of updating and enhancement. The solutions portfolio includes solutions for all core banking services, whether this relates to interfaces with end-customers or solutions to support a bank s internal processes and employees. The portfolio is module-based, and includes banking services, transactions systems, payment solutions and card services. Services are delivered using various delivery models designed to meet differing needs, and EVRY Financial Services can deliver a complete banking service for Norwegian banks in the form of SaaS (Software as a Service) as well as having the expertise and delivery capacity to provide customer-specific solutions. In addition, EVRY Financial Services supplies BPO (Business Process Outsourcing) for a number of banks. This relates to some aspects of the applications portfolio related to ATM solutions and card services for banks in the United Kingdom. The portfolio also includes a unique value chain of card services that are delivered to Nordic banks and banks in the United Kingdom. In order to combat card fraud, EVRY Financial Services carries out global monitoring of several billion card transactions around the clock for around 5 million Nordic cardholders. EVRY Financial Services operates a delivery model that is integrated with the company s Global Sourcing units in order to give customers speedy timeto-market and better cost efficiency. Over recent years, EVRY Financial Services has developed from a strong position in the Norwegian market to become a leading Nordic vendor of IT services for the banking and finance sector. The EVRY Financial Services segment reported revenue of NOK 858 million in the third quarter of 2013 compared to NOK 765 million in the third quarter of 2012, representing organic growth in revenue of 12%. Revenue growth was particularly strong in the areas of minibanks and self service channels. Cost of goods sold in the third quarter of 2013 was NOK 184 million, 12% higher than in the third quarter of The increase was related to hardware-related sales. Salaries and related costs were 1% higher in the third quarter of 2013 than in the third quarter of The increase reflects the general annual increase in salaries. Depreciation in the third quarter of 2013 was NOK 23 million, down by NOK 1 million from the third quarter of Other operating expenses were higher in the third quarter of 2013 than in the third quarter of 2012, but in line with the previous quarters in The increase is amongst other due to changes in the composition of hired and own resources towards certain major customers. The EVRY Financial Services segment produced operating profit before amortisation of intangible assets (EBITA) of NOK 95 million in the third quarter of 2013 compared to NOK 91 million in the third quarter of EBITA margin for the third quarter of 2013 was 11.0% compared to 11.9% in the third quarter of EBITA margin for the third quarter of 2013 was somewhat reduced as a result of costs associated with the Future Proof improvement program. Both the segment s card services activity and its Swedish activities again reported a good improvement in profitability for the third quarter of Investment in operational fixed assets in the third quarter of 2013 amounted to NOK 46 million compared to NOK 58 million in the third quarter of This included investment in software developed in-house of NOK 21 million in the third quarter EVRY Financial Services NOK million Q Q Operating revenue Cost of goods sold Salaries and related costs Other operating costs Total operating costs Operating profit before depreciation (EBITDA) Ordinary depreciation Operating profit before amortisation (EBITA) EBITA % 11,0 % 11,9 % 8,7 % 9,1 % 9,4 % Operational investment (CAPEX) No. of employees

6 6 Quarterly report Third quarter 2013 of 2013, which was in line with the third quarter of Investment in operational fixed assets in the third quarter of 2012 included some customer-specific operational investments. The EVRY Financial Services segment s order backlog was NOK 4.2 billion at the end of September 2013, a reduction of NOK 0.1 billion from the end of the second quarter of In the third quarter of 2013, EVRY Financial Services signed renewals of contracts with customers including Swedbank and SEB Kort AB. Of the segment s total order backlog, NOK 0.8 million is due for delivery in the fourth quarter of EVRY Sweden segment EVRY Sweden has a unique regional position, and offers everything from strategic advice and consulting services through to solutions and IT operating services. With delivery capacity in 26 towns and cities, EVRY Sweden serves customers throughout Sweden, with a particular focus on SMB companies and their need for complete solutions. EVRY Sweden also has a significant portfolio of industry vertical solutions that combine industryspecific insight and business understanding with technological expertise. Through the industry verticals, EVRY Sweden delivers a broad spectrum of IT services, including consulting and solutions services together with IT operating services, and EVRY Sweden has developed a leading position in services for the healthcare sector. EVRY Sweden also delivers specialist services independent of geographic location and sector based on strong specialist expertise, for example ERP solutions, mobility, cloud-based solutions and Business Intelligence. EVRY Sweden also has its own operating services organisation, which focuses on medium-sized businesses and entities in the private and public sectors. The EVRY Sweden segment reported operating revenue of NOK 708 million in the third quarter of 2013 compared to NOK 727 million in the third quarter of This represented a drop in organic revenue of 6%. Of the total decline in revenue, 2 percentage points was the result of lower hardware sales, particularly in the mobility area. In addition, there was some reduction in business volumes due to fewer employees in the consulting activities and less use of hired-in consultants. The challenging economic situation in Sweden continues to have a marked effect on the Swedish IT services market. The Board is satisfied to note that the billable utilisation rate for EVRY Sweden s consulting activities has held up well in the third quarter, although there was some reduction relative to the previous quarter. Hourly charge out rates in the third quarter of 2013 were 1% lower than in the third quarter of Hourly charge out rates were also somewhat lower than in the previous quarter. Cost of goods totalled NOK 227 million in the third quarter of 2013, representing a reduction of 10% from the third quarter of The reduction was largely due to a lower level of hardware sales, as well as the reduction in the use of hired-in consultants. Salaries and related costs were NOK 335 million in the third quarter of 2013 compared to NOK 334 million in the third quarter of After adjusting for currency effects, salaries and related costs in the third quarter of 2013 showed a small reduction relative to the third quarter of The general increase in salary levels was offset by a reduction in headcount in the area of Swedish activities with higher salary levels in the third quarter of 2013 as compared to the third quarter of Depreciation in the third quarter of 2013 was NOK 13 million compared to NOK 11 million in the third quarter of The EVRY Sweden segment produced operating profit before amortisation of intangible assets (EBITA) of NOK 43 million in the third quarter of 2013 compared to NOK 48 million in the third quarter of EBITA margin for the third quarter of 2013 was 6.1% compared to 6.6% in the third quarter of The result in the third quarter of 2013 was negatively influenced by quality costs of NOK 6 million. Work is underway on cost EVRY Sweden NOK million Q Q Operating revenue Cost of goods sold Salaries and related costs Other operating costs Total operating costs Operating profit before depreciation (EBITDA) Ordinary depreciation Operating profit before amortisation (EBITA) EBITA % 6,1 % 6,6 % 5,8 % 6,5 % 7,1 % Operational investment (CAPEX) No. of employees Hardware sales Billable utilisation rate Sweden 69,6 % 70,1 % 70,6 % 71,3 % 71,0 % Working days Sweden

7 Quarterly report Third quarter reducing measures, which are making a good contribution to offsetting the effect of lower revenue. Investment in operational fixed assets in the third quarter of 2013 amounted to NOK 10 million compared to NOK 23 million in the third quarter of The EVRY Sweden segment s order backlog was NOK 2.8 billion at 30 September 2013, a decrease of NOK 0.1 billion from the end of the second quarter of Of the segment s total order backlog, NOK 0.6 billion is due for delivery in the fourth quarter of EVRY Norway segment EVRY Norway has a strong portfolio of services and a broad base of customers. The segment covers the entire range from consulting and development through to services management and operating services, giving EVRY Norway the ability to offer services for the entire IT life cycle. Located in 21 towns and cities, EVRY Norway has the delivery capacity to cover the major part of Norwegian business and industry and the local government sector. Through its strong local presence, EVRY Norway also offers consulting, infrastructure and operating services specifically structured for the SMB sector. EVRY Norway has a long history with leading customers in the Norwegian public and private sectors, and holds strong positions in a number of industry verticals where it combines industry insight and business understanding with technological expertise. Customer deliveries cover a broad range of consulting and solutions services, as well as IT operating services. EVRY Norway has a significant position in the local government and healthcare sectors, and is currently strengthening its position in other verticals including retail, oil & gas and insurance. Through its extensive activities, EVRY Norway has in-depth technical expertise in specialist services that are independent of geographic location and sector. This includes growth areas such as mobility, cloud-based solutions and Business Intelligence. The group also includes its Global Sourcing activities for reporting purposes in the EVRY Norway segment, as well as its SAP-related consulting activities in Denmark. The EVRY Norway segment reported operating revenue of NOK 1,404 million in the third quarter of 2013 compared to NOK 1,487 million in the third quarter of 2012, representing a decline in organic revenue of 5%. As previously indicated, the company anticipates that revenue from deliveries of operating services to the large customer market (excluding banking and finance) will be NOK 200 million lower in 2013, principally in connection with the former IS Partner activities. The revenue trend for the year to date is in line with this expectation. The billable utilisation rate in the third quarter of 2013 was 63.4%, which was in line with the third quarter of There was a marked improvement in billable utilisation rate in the Business Intelligence area. Hourly charge out rates improved in the third quarter of 2013, and were 1% higher than in the third quarter of Cost of goods totalled NOK 478 million in the third quarter of 2013, representing a reduction of 6% from the third quarter of The reduction was related to the lower level of revenue and a fall in hardware sales. Salaries and related costs were NOK 661 million in the third quarter of 2013 compared to NOK 692 million in the third quarter of In the operating services area, fixed salary costs were lower than in the third quarter of 2012 due to the reduction in headcount resulting from the synergy program. This was to some extent offset by the general increase in salaries and increases in headcount in other areas of the segment. In addition, salaries and related costs were reduced by the capitalisation of salary costs related to implementation projects in the operating services area. EVRY Norway NOK million Q Q Operating revenue Cost of goods sold Salaries and related costs Other operating costs Total operating costs Operating profit before depreciation (EBITDA) Ordinary depreciation Operating profit before amortisation (EBITA) EBITA % 6,7 % 5,9 % 5,5 % 5,2 % 5,4 % Operational investment (CAPEX) No. of employees Nordics No. of employees Global Sourcing Hardware sales Billable utilisation rate Norway 63,4 % 63,5 % 66,6 % 65,5 % 68,1 % Working days Norway

8 8 Quarterly report Third quarter 2013 Depreciation in the third quarter of 2013 was NOK 61 million, as compared to NOK 62 million in the third quarter of The EVRY Norway segment produced operating profit before amortisation of intangible assets (EBITA) of NOK 94 million in the third quarter of 2013 compared to NOK 88 million in the third quarter of The profit reported for the third quarter of 2013 was affected the decline in revenue from the large customer segment, as well as costs related to the Future Proof program. However, profitability was affected positively by the cost-saving measures that have been implemented and higher hourly charge out rates. EBITA margin for the third quarter of 2013 was 6.7% compared to 5.9% in the third quarter of Investment in operational fixed assets in the third quarter of 2013 was NOK 88 million compared to NOK 53 million in the third quarter of The increase related to investments in connection with the Future Proof program. The EVRY Norway segment s order backlog was NOK 7.3 billion at 30 September 2013, down by NOK 0.6 billion from the end of the second quarter of The segment has seen a good inflow of new contracts in the area of regional operating services where new contracts have been signed with customers including Statens Kartverk (the Norwegian Mapping Authority), Aibel and NHST Media Group AS. Of the segment s total order backlog, NOK 1.5 billion is due for delivery in fourth quarter of Support functions/ eliminations Elimination of internal revenue between the group s segments was NOK 106 million in the third quarter of 2013 compared to NOK 97 million in the third quarter of Support functions not allocated to the segments incurred an operating loss before amortisation of intangible assets (EBITA) of NOK 35 million in the third quarter of 2013, as compared to a loss of NOK 48 million in the third quarter of The third quarter of 2012 included synergy costs of NOK 13 million (including brand costs). The comparable figures reported have been restated as a result of changes in IAS 19 in respect of pension costs. Further information is provided in Note 1 to the interim report. Financial information Cash flow and liquidity Cash flow from operations, before payments related to restructuring, was NOK 232 million in the third quarter of 2013, as compared to NOK 171 million for the third quarter of Cash flow from operations, before payments related to restructuring, for the first nine months of 2013 was NOK 382 million, representing an improvement of NOK 261 million from the same period in 2012 as a result of an improved working capital situation. Investment in operational fixed assets and in software developed in-house amounted to NOK 156 million in the third quarter of 2013, as compared to NOK 126 million in the third quarter of In addition, leasing agreements totalling NOK 2 million were entered into in the third quarter of 2013, whereas no leasing agreements were entered into in the third quarter of Investment in software developed in-house totalled NOK 27 million in the third quarter of 2013 compared to NOK 22 million in the third quarter of Net interest-bearing liabilities totalled NOK 3,288 million at 30 September 2013, up by NOK 281 million from the end of By way of comparison, net interest-bearing liabilities at the end of September 2012 totalled NOK 3,529 million. The group s liquidity reserves at the close of September 2013 amounted to NOK 1,703 million, as compared to NOK 2,013 million at 31 December Undrawn credit facilities accounted for NOK 1,375 million of the total at 30 September At the close of the third quarter of 2013, average working capital over the previous four quarters was equivalent to 4.9% of total revenue. This represents a reduction relative to the close of the previous quarter, when average working capital was 5.1% of total revenue. At the end of 2012, average working capital was 6.0% of total revenue. The target for working capital to be 4% of revenue is maintained, but it is not considered realistic to expect to achieve this target until the end of the first half of The measures implemented to improve the situation have had a good effect on the company s underlying working capital, and the company s free cash flow over the last four quarters was NOK 380 million as at the end of the third quarter of 2013 as compared to NOK 33 million at the end of third quarter The company continues to work in a focused manner on further improvement measures. Company outlook The signs of an improved outlook for the global economy seen in the first half of the year continued in the third quarter. The clearest signs of optimism are in the Euro zone, where company managers now have a markedly more optimistic view of future

9 Quarterly report Third quarter prospects than was the case in the second quarter. Despite this, the economic situation in the most important countries for Nordic exports remain weak, and the pace of GDP growth in both Norway and Sweden slowed during the third quarter. Weak economic conditions are expected to continue for the rest of this year, with stronger GDP growth expected in For the IT services market, EVRY observes that the outlook in Norway and Sweden is currently characterised by uncertainty. There continue to be considerable differences in performance between the different segments of the market. Growth in demand for operating services and outsourcing is principally being driven by demand from customers in the SMB market, where outsourcing is used as a tool to achieve cost savings and to free up resources. However, in the Swedish market it is apparent that the weak economic situation is having an adverse effect on the usual pattern of supplementary sales in the operating services area. The market for general consulting services is affected to some extent by the uncertain market outlook, with a trend towards shorter assignments and decisions to delay the start of new projects. However, there is still good demand for specific technological expertise in service areas that strengthen customers competitiveness. The IT services markets in Norway and Sweden are affected by global trends. This is driven to a large extent by two major trends that originate in the consumer market, namely the wider and greater use of mobile devices and growth in the use of mobile applications or apps. Companies use cloud technology in addition to their traditional IT solutions to deliver these solutions. Against this background, EVRY anticipates good demand for expertise and advice on the implementation of new solutions, combined with demand for upgrading network infrastructure and the advanced security solutions that are required. Given its broad customer base, EVRY is well positioned to capture its share of the growth in demand driven by these trends. With our extensive expertise and understanding of crucial local factors, we are less exposed to downward pressure on prices from global competitors, and EVRY expects to see good performance in the consulting area with a modest upward trend for hourly rates over the coming quarters. The increasing use of technology to support cloud-based solutions and mobile infrastructure also represents good opportunities to develop additional business with our existing operating services customers. For the IT services market in Norway, we anticipate a high level of activity in the public sector. The views expressed by the new government in Norway support this view, with specific commitments on the launch of a number of major projects that will represent improved growth opportunities for EVRY. It also seems likely that the change of government will open up new opportunities and greater interest in the use of outsourcing for operating services. EVRY offers efficient operating service concepts specifically designed for medium-sized companies, and the inflow of orders from this segment leads EVRY to expect continuing sound growth in this area. In the large customer segment of the market, EVRY s Future Proof operations concept has already proved attractive to a number of customers, but future prospects depend to some extent on the outcome of the renegotiation with DNB of its current contract. As previously communicated, the company does not expect any improvement in EBITA from the services segment IT Operations in 2013 relative to Conditions in the Swedish IT services market continue to be challenging even though the economic situation is showing improvement, albeit at a rather slow pace. The level of risk associated with the economic outlook is generally assumed to have reduced, principally in response to an easing in concern over the outlook for Europe. Some parts of the Swedish export industry are still affected to a great extent by weak demand due to the weak economic situation in Europe. The general view is that the anticipated more marked improvement has been delayed, and is now not expected to materialise until the New Year. Customers continue to prioritise investments that will improve efficiency and save costs rather than investing in more growth-oriented areas. It takes longer time than expected before the economic situation in Sweden turns. This means that we do not expect growth in the IT services market in Sweden until In respect of the overall future outlook for EVRY, the macroeconomic situation will be a crucially important factor. In a climate of greater optimism, increased demand from the SMB market in particular will contribute to growth. However, more intense competition for assignments for large customers will continue to exert downward pressure on prices for operating services. Oslo, 21 October 2013 Board of Directors of EVRY ASA Arve Johansen Chairman of the Board Dag Mejdell Lisbeth Gustafsson Anders Brandt Eli Skrøvset Hilde Ringereide Jan Dahlström Eirik Bornø Sigmund Ørjavik Ingrid Lund Terje Mjøs Chief Executive Officer

10 10 Quarterly report Third quarter 2013 Condensed consolidated statement of comprehensive income NOK million Q Q3 2012* * 2012* Operating revenue Cost of goods sold Wages and salaries Other operating costs Operating profit bef. depreciation (EBITDA) Depreciation of operating assets Depreciation of own-developed software Operating profit before depreciation of intangible assets (EBITA) Non-recurring items Depreciation of intangible assets Operating profit (EBIT) Net financial items Profit before tax Income taxes Net income (loss) Comprehensive income Cash flow hedges Restatement differences Pensions Total comprehensive income Total profit for the period Total profit for the period are allocated as follows Owners of the parent Non-controlling interests * Restated

11 Quarterly report Third quarter Condensed consolidated statement of financial position NOK million * * Goodwill Other intangible assets Tangible assets Non-current financial assets Total non-current assets Accounts receivable Other current receivables Bank deposits Total current assets Total assets Equity Non-controlling interests Total equity and non-controlling interests Provision for liabilities Non-current non-interest bearing liabilities Non-current interest bearing liabilities Total non-current liabilities Accounts payable Duties payable, vacation allowance Current non-interest bearing liabilities Current interest bearing liabilities Total current liabilities Total equity and liabilities * Restated

12 12 Quarterly report Third quarter 2013 Condensed consolidated cash flow analysis NOK million Q Q3 2012* * 2012* Operating Income (EBIT) Adjustments to reconcile operating income to net cash provided by operating activities Depreciation, write-down and amortization Tax paid Interest paid Change in net working capital Other Operational cash flow before non-recurring items Change in provision non-recurring items Net cash flow from operations Investment in fixed operating assets Investment in in-house developed software Sale of fixed operating assets Investment in group companies Net cash flow from investments Borrowings repaid New borrowing Dividends paid Proceeds/payments from equity transactions Net cash flow from financing Net change in liquid assets Bank deposits at start of period Currency translation in liquid assets Bank deposits at end of period * Restated

13 Quarterly report Third quarter Key figures Q Q3 2012* * 2012* Key figures per share (NOK): Earnings per share 0,37 0,26 0,94 0,74 0,60 Earnings before non-recurring items 0,44 0,26 1,03 0,72 1,16 EBITDA per share 1,14 1,08 3,15 3,02 4,30 Cash from operations b/f non-recurring items 0,87 0,64 1,43 0,45 2,92 Other key figures: EBITDA-margin 10,6 % 10,0 % 9,1 % 8,5 % 9,0 % EBITA-margin 6,9 % 6,2 % 5,6 % 5,0 % 5,4 % Return on invested capital (ROIC) 8,4 % 8,3 % 8,0 % 7,6 % 8,8 % Net working capital Equity ratio 47 % 43 % 45 % Gearing 0,57 0,66 0,55 NIBD / EBITDA 3,10 2,85 2,73 Net interest bearing debt (NOK mill) Average number of shares * Restated 2012 figures Consolidated statement of changes in equity NOK million * * Equity at January Total profit after tax Dividends Trade in own shares Equity at end of period * Restated 2012 figures

14 14 Quarterly report Third quarter 2013 Notes Note 1 General information EVRY ASA s summarised consolidated accounts for the second quarter of 2013 were approved at a meeting of the Board of Directors on 21 October EVRY (Group) consists of EVRY ASA and the companies over which EVRY ASA has a controlling influence. EVRY ASA is a Norwegian public limited company and is listed on the Oslo stock exchange (Oslo Børs). The interim report is published in accordance with IAS 34 on interim reporting. With the exception of the implementation of changes to the accounting standard for pensions (IAS 19) (see below), the interim report has been produced using the same accounting principles and methodology as used for the most recent annual report. For information about the approved changes to IFRS / IAS with effect from 1 January 2013, please refer to note 1 in the Group s Annual Report for The implementation of these changes has not had any material effect on the consolidated interim financial statement, with the exception of the implementation of the changes to IAS 19 Employee Benefits (as revised in 2011). One effect of the changes to IAS 19 is that the corridor method can no longer be applied for the recognition of changes in actuarial estimates. The effect of any changes in actuarial estimates must now be recognised in full as part of the reporting of other income and costs in the period in which they arise. The IAS 19 changes also mean that pension costs must now be split between ordinary profit and loss and other income and costs. The expected return on pension assets must be calculated by using the interest rate applied to discount gross pension liabilities. The implementation of the changes had a positive effect on the group s equity as of 1 January 2013 of NOK 129 million, ref. the table below. Comparable figures for 2012 have been restated accordingly. The table below shows the effects of the implementation of IAS 19 on the figures reported for 2012: Consolidated statement of financial position NOK million Per Per Per Deferred tax Pension liabilities Equity Consolidated income statement NOK million Q Pensions cost Non-recurring items Income taxes Net income Other comprehensive income Pension Total profit for the period

15 Quarterly report Third quarter Note 2 Segments The group s activities are divided into three segments. The segments reflect the markets served, and correspond with the structure used for routine reporting to the group s senior decision makers. The three segments are: EVRY Financial Services, EVRY Sweden and EVRY Norway. Operating revenue NOK million Q3'13 Q3' Q2'13 Q1'13 Q4'12 Q3'12 Q2'12 Q1'12 Q4'11 Q3'11 Q2'11 Q1'11 EVRY Financial Services EVRY Sweden EVRY Norway Eliminations Total EVRY Operating profit before amortisation (EBITA) NOK million Q3'13 Q3' Q2'13 Q1'13 Q4'12 Q3'12 Q2'12 Q1'12 Q4'11 Q3'11 Q2'11 Q1'11 EVRY Financial Services EVRY Sweden EVRY Norway Support functions Total EVRY EBITA margin NOK million Q3'13 Q3' Q2'13 Q1'13 Q4'12 Q3'12 Q2'12 Q1'12 Q4'11 Q3'11 Q2'11 Q1'11 EVRY Financial Services 11,0 % 11,9 % 9,4 % 8,4 % 6,8 % 10,3 % 11,9 % 8,7 % 6,9 % 9,5 % 10,5 % 7,0 % 4,4 % EVRY Sweden 6,1 % 6,6 % 7,1 % 5,5 % 5,7 % 8,7 % 6,6 % 6,1 % 6,8 % 8,5 % 6,4 % 4,9 % 6,1 % EVRY Norway 6,7 % 5,9 % 5,4 % 5,4 % 4,7 % 6,1 % 5,9 % 4,7 % 5,0 % 5,7 % 7,4 % 5,9 % 5,5 % Total EVRY 6,9 % 6,2 % 5,4 % 5,5 % 4,5 % 6,7 % 6,2 % 4,4 % 4,4 % 6,7 % 7,8 % 5,2 % 4,9 % * The pro forma figures for EVRY Financial Services and EVRY Norway for 2012 are somewhat adjusted since announcement of pro forma figures.

16 16 Quarterly report Third quarter 2013 Note 3 Non-recurring items Non-recurring items NOK million Q Q First nine months of 2013 First nine months of 2012 Termination of pension scheme Provision for restructuring Provision for premises Total Non-recurring items Note 4 Financial instruments Financial instruments that are valued at fair value in the statement of financial position are grouped on the basis of the following fair value hierarchy: Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2: Instruments for which observable information is available, but for which there is no active market. Level 3: Instruments for which there is no observable market data and the determination of fair value accordingly uses company specific/subjective information Assets NOK million Level 1 Level 2 Level 3 Total book value Fair value Non-current receivables Account receivables Other current receivables Bank deposits Total Assets Liabilities NOK million Level 1 Level 2 Level 3 Total book value Fair value Non-current interest bearing liabilities Other non-current liabilities Account payables Other current liabilities Total Liabilities Note 5 Dividend The Annual General Meeting held on 13 May 2013 approved a dividend for 2012 of NOK 0.35 per share. This resulted in a total payment of NOK 93 million in the second quarter of 2013.

17 Quarterly report Third quarter Other relevant financial information Order backlog NOK million Order backlog Order backlog distributed Later EVRY Financial Services EVRY Sweden EVRY Norway Total order backlog % of total 20 % 41 % 22 % 10 % 7 % Number of working days Q1 Q2 Q3 Q4 Total 2013 Norway Sweden Norway Sweden Change Norway Change Sweden

18 18 Quarterly report Third quarter 2013 Analysis by segment (pro forma) Operating revenue NOK million Q3 13 Q Q2 13 Q1 13 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Q kv 11 IT Operations Solutions Consulting Eliminations Total EVRY Operating profit before amortisation (EBITA) NOK million Q3 13 Q Q2 13 Q1 13 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Q kv 11 IT Operations Solutions Consulting Support functions Total EVRY EBITA margin NOK million Q3 13 Q Q2 13 Q1 13 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Q kv 11 IT Operations 6,4 % 7,7 % 4,8 % 3,0 % 1,5 % 4,9 % 7,7 % 4,5 % 2,1 % 5,2 % 8,0 % 5,0 % 3,4 % Solutions 11,1 % 8,9 % 8,9 % 9,6 % 8,6 % 10,5 % 8,9 % 8,3 % 7,8 % 9,0 % 9,8 % 7,6 % 6,2 % Consulting 3,8 % 4,2 % 6,3 % 5,7 % 6,5 % 7,5 % 4,2 % 4,6 % 8,4 % 7,3 % 4,2 % 4,3 % 7,1 % Total EVRY 6,9 % 6,2 % 5,4 % 5,5 % 4,5 % 6,7 % 6,2 % 4,4 % 4,4 % 6,7 % 7,8 % 5,2 % 4,9 %

19 Quarterly report Third quarter Financial calendar Fourth quarter february 2014 First quarter APRIL 2014 Annual General Meeting 14 may 2014 Second quarter JULY 2014 Third quarter OCTOBER 2014 Fourth quarter FEBRUARY 2015 Contact details EVRY ASA PO Box 640 Skøyen 0214 Oslo Welcome back to the to Forth quarter 10 February 2014 Visit adress: Snarøyveien Fornebu Org. No: MVA Telephone: (+47) Fax: (+47) Design and production: Artbox AS Print: Printbox AS

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