April–June highlights
- Net sales totalled EUR 462.3 (431.5) million, an increase of 7%.
- Order intake at EUR 600 (590) million.
- Operating profit (EBIT) amounted to EUR 19.2 (19.5) million, representing an operating margin of 4.2% (4.5).
- Operating profit excluding one-off items was EUR 24.5 (21.3) million, representing an operating margin of 5.3% (4.9).
- Profit after taxes was EUR 11.4 (11.7) million.
- Net cash flow from operations amounted to EUR 0.0 (27.5) million.
January–June highlights
- Net sales totalled EUR 923.9 (854.4) million, an increase of 8%.
- Order intake was EUR 1 132 (962) million.
- Operating profit (EBIT) amounted to EUR 42.8 (38.3) million, representing an operating margin of 4.6% (4.5).
- Operating profit, excluding one-off items, amounted to EUR 48.5 (47.9) million, 5.2% (5.6) of net sales.
- Profit after taxes was EUR 24.9 (23.7) million.
- Net cash flow from operations amounted to EUR 38.8 (55.4) million.
Outlook for 2011 unchanged
For 2011, industry analysts expect growth of 2–4% for the IT services market in Western Europe. In 2011, Tieto expects its net sales to develop in line with the Western European IT services market. Full-year operating profit (EBIT) excluding one-off items is expected to be better than in 2010 (EUR 110.0 million in 2010).
| Q2/2011 | Q2/2010 | H1/2011 | H1/2010 | |||
| Net sales, EUR million | 462.3 | 431.5 | 923.9 | 854.4 | ||
| Change in net sales, % | 7 | -3 | 8 | -3 | ||
| Operating profit (EBITA), EUR million | 21.0 | 21.5 | 46.5 | 42.1 | ||
| Operating margin (EBITA), % | 4.5 | 5.0 | 5.0 | 4.9 | ||
| Operating profit (EBIT), EUR million | 19.2 | 19.5 | 42.8 | 38.3 | ||
| Operating margin (EBIT), % | 4.2 | 4.5 | 4.6 | 4.5 | ||
| Operating profit (EBIT) excl. one-off items, EUR million | 24.5 | 21.3 | 48.5 | 47.9 | ||
| Operating margin (EBIT) excl. one-off items, % | 5.3 | 4.9 | 5.2 | 5.6 | ||
| Profit after taxes, EUR million | 11.4 | 11.8 | 24.9 | 23.7 | ||
| Net cash flow from operations, EUR million | 0.0 | 27.5 | 38.8 | 55.4 | ||
| EPS, EUR | 0.16 | 0.17 | 0.35 | 0.33 | ||
| Return on equity, 12-month rolling, % | 9.6 | 13.8 | 9.6 | 13.8 | ||
| Return on capital employed, 12-month rolling, % | 14.9 | 21.1 | 14.9 | 21.1 | ||
| Investments, EUR million | 13.3 | 25.2 | 78.6 | 48.5 | ||
| Interest-bearing net debt, EUR million | 136.4 | 89.6 | 136.4 | 89.6 | ||
| Gearing, % | 25.8 | 17.1 | 25.8 | 17.1 | ||
| Personnel on 30 June | 18 071 | 16 885 | 18 071 | 16 885 | ||
Ari Karppinen, acting President and CEO:
“Sales continued to grow in the second quarter, and we signed many important new contracts. We have kept tight control on the fixed costs, but the volume growth has lead to increased use of subcontractors and our variable costs have grown faster than sales. In addition to this, profitability was burdened by efficiency and quality costs. This is an area where we already have started a number of actions that will lead to improved profitability.
Our view on the IT services market development is intact despite the increasing concerns over European economies. However, a prolonged debt crisis might have a negative impact on our customers businesses as well as the currently good development in the IT services market.
At the moment, the demand for IT services is growing in all our main markets and we plan to capture this good momentum. Our main focus is on using our resources and competences as efficiently as possible to meet customer demand and provide excellent services to our customers. Additionally, we will continue to execute the initiated streamlining actions and ensure that we follow our internal processes diligently to avoid internal inefficiency and unnecessary quality costs. We trust that these measures will yield results towards the end of the year.“
FINANCIAL PERFORMANCE IN APRIL–JUNE
Financial performance by market unit
|
Net sales Q2/2011, EUR million |
Net sales Q2/2010, EUR million | Change, % | Operating margin Q2/2011, % | Operating margin Q2/2010, % | ||
| Finland and the Baltic countries | 178 | 184 | -3 | 2.4 | 8.7 | |
| Scandinavia | 140 | 118 | 18 | 3.7 | 4.9 | |
| Central Europe & Russia | 33 | 32 | 3 | -17.1 | -13.3 | |
| Global Accounts | 193 | 178 | 8 | 9.6 | 9.5 | |
| Group elimination | -80 | -81 | 0 | |||
| Total | 462 | 431 | 7 | 4.2 | 4.5 | |
For further information, please contact:
Lasse Heinonen, CFO, tel. +358 2072 66329, +358 50 393 4950, lasse.heinonen@tieto.com
Reeta Kaukiainen, VP, Communications and Investor Relations, tel. +358 2072 68711,
+358 50 522 0924, reeta.kaukiainen@tieto.com
Press conference for analysts and media will be held at Tieto’s premises in Helsinki, address: Aku Korhosen tie 2‑6, at 9.30 am EET (8.30 am CET. 7.30 am UK time). The results will be presented in English by Ari Karppinen, acting President and CEO and Lasse Heinonen, CFO.
The conference will be webcasted and published live on Tieto's website www.tieto.com and there will be a possibility to present questions online. An on-demand video will be available after the conference.
Tieto publishes financial information in English, Finnish and Swedish. All releases are posted in full on Tieto's website as soon as they are published.
TIETO CORPORATION
DISTRIBUTION
NASDAQ OMX Helsinki
NASDAQ OMX Stockholm
Principal Media
Tieto is the leading IT service company in Northern Europe providing IT and product engineering services. Our highly specialized IT solutions and services complemented by a strong technology platform create tangible business benefits for our local and global customers. As a trusted transformation partner, we are close to our customers and understand their unique needs. With about 18 000 experts, we aim to become a leading service integrator creating the best service experience in IT, www.tieto.com
Tieto Corporation
Business ID: 0101138-5
Aku Korhosen tie 2−6
PO Box 38
FI-00441 HELSINKI, FINLAND
Tel +358 207 2010
Fax +358 2072 68898
Registered office: Helsinki
E-mail: info@tieto.com
www.tieto.com
