Presentation for investors Presentation for investors Results for the First Half of 2011 Nýherji hf. 28. July 2011
Nýherji hf. presentation for investors 1 Introduction 2 Financials 3 Outlook
EBITDA was ISK 300 million for the first half of the year EBITDA was ISK 300 million for the first half of the year • ISK 158 million the corrsponding period last year • All organizational units provide positive EBITDA EBITDA ratio was 3.90% as compared to 2.2% last year Revenues have increased by about ISK 631 million, or 9%, from the Revenues have increased by about ISK 631 million, or 9%, from the previous year Net profits totalled ISK 78 millions for the first six months of the year Organizational changes in Iceland during Q2 reduced the number of operating companies from eight to three
New organizational structure for domestic operations A new organizational structure for Nýherji � s domestic operations took effect on 1st of April Three of Nýherji � s subsidiaries merged with the parent company: The hosting and managed service company Skyggnir ehf., Sense ehf., which specialises in audio and video solutions, and Viðja ehf. The software companies Vigor ehf. and Applicon ehf. merged under the name of Applicon The software companies Vigor ehf. and Applicon ehf. merged under the name of Applicon ehf. Vigor � s solutions become part of Applicon � s solutions portfolio TM Software ehf., which works in software development and EMR ehf., which owns and developes a medical record system and other solutions in the health industry, merged under the name of TM Software ehf. The medical record system of EMR becomes part of TM Software � s solutions portfolio
New organizational structure for domestic operations Why change the structure? Merging companies in related operations and building bigger business units The aim of the changes is to gain competitive advantage and improve the companies unique position in domestic markets as well as to strengthen the service offerings to the customers
Improved performance of IT services after structural changes Sofware and hardware sales at Nýherji hf. were above projections and exceeded the levels achieved at the same time last year • Considerable increase in the sale of IBM Power servers and IBM disk and storage solutions Sales of Sony and Canon consumer products were robust robust The merger of Skyggnir with Nýherji s other operations will improve the performance of this devision The competitive environment for hosting and managed services is very challenging in domestic markets • Stiff price competition with businesses that were propped up by Icelandic banks or are controlled by holding companies now in the hands of creditors after going through bankruptcy
Implementation of a SAP-based banking solution marks a turning point Applicon ehf. performed in line with projections • Outlook is good for the second half of the year Applicon in Sweden signed a contract for the sale and implementation of a new SAP–based banking solution for a medium-sized bank in Sweden • • The implementation marks a turning point for Applicon The implementation marks a turning point for Applicon • Implementation of the PeTra software for Carnegie, SEB and Nordea • Applicon Sweden performed above projections The performance of Applicon A/S Denmark was in line with projections • Ongoing large implementation for Region Hovedstaden • Demand for business software and related services is still limited in Denmark
Sales of TM Software s solutions in North America TM Software ehf. performed better than over the same period last year • Growth in sales of internally developed software solutions in North-America and Europe • Tempo software • • Continuous development of software for the health Continuous development of software for the health industry • Good project pipeline Dansupport A/S in Denmark posted positive EBITDA • The Danish economy is recovering at a slower pace than the other Nordic countries
Nýherji hf. presentation for investors 1 Introduction 2 Financials 3 Outlook
Income statement Q2 2011 In ISK millions Q2 % of Q2 % of 2011 sales 2010 sales Sales of goods and services .........…. 3,977 100% 3,529 100% COGS .......……………………………. (1,939) (49%) (1,575) (45%) Gross profit ........……………………. 2,038 51% 1,954 55% Salary and related expenses ..……… Salary and related expenses ..……… (1,490) (1,490) (38%) (38%) (1,462) (1,462) (41%) (41%) Other operating expenses ....……….. (408) (10%) (369) (10%) Depreciation .......……………………... (71) (2%) (76) (2%) Operating profit (loss) (EBIT) ...….. 69 2% 47 1% EBITDA ……………………………….. 140 4% 123 3%
Income statement First Half 2011 In ISK millions 1.1.-30.6 % of 1.1.-30.6 % of 2011 sales 2010 sales Sales of goods and services .........…. 7,670 100% 7,039 100% COGS .......……………………………. (3,590) (47%) (3,077) (44%) Gross profit ........……………………. 4,080 53% 3,962 56% Salary and related expenses ..……… Salary and related expenses ..……… (2,963) (2,963) (39%) (39%) (2,975) (2,975) (42%) (42%) Other operating expenses ....……….. (817) (11%) (829) (12%) Depreciation .......……………………... (134) (2%) (142) (2%) Operating profit (loss) (EBIT) ...….. 166 2% 16 0% EBITDA ……………………………….. 300 4% 158 2%
Sales continue to be good 4500 16% 4000 12% 3500 8% 3000 4% illions 2500 0% ISK mill 2000 -4% 1500 -8% 1000 -12% 500 -16% 0 -20% Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Sales EBIT% EBITDA%
EBITDA higher than same quarter last year 200 8% 150 6% 100 4% illions 50 2% ISK mill 0 0% -50 -2% -100 -4% -150 -6% Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 EBITDA EBTIDA%
EBITDA – foreign and domestic operations 200 200 160 160 120 120 80 80 illions illions ISK mill ISK mill 40 40 0 0 -40 -40 -80 -80 -120 -120 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2009 2009 2009 2010 2010 2010 2010 2011 2011 2009 2009 2009 2010 2010 2010 2010 2011 2011 Foreign operations Domestic operations
Balance sheet 30.06.2011 In ISK millions 30.06.2011 31.12.2010 Non-current assets ……………………………….... 4,405 4,292 Current assets .....………………………………….. 3,821 3,688 Total assets ....…………………………………...... 8,226 7,981 Equity ..…………………………………………….... Equity ..…………………………………………….... 2,384 2,384 2,420 2,420 Non-current liabilities ..……………………………. 2,318 2,374 Current liabilities ...…………................................. 3,524 3,187 Total equity and liabilities ..…………………….. 8,226 7,981 Current ratio ...……………………………………... 1.08 1.16 Equity ratio .....…………………………………....... 29.0% 30.3%
Nýherji hf. presentation for investors 1 Introduction 2 Financials 3 Outlook
Outlook The project pipeline for the software companies is good and expecting further growth Good sales prospects for internally developed software packages: TEMPO, PeTra, iBank and APS Sales of computer equipment to the business market have been growing and many companies will need to update their computer equipment The market for managed and hosting services is still challenging
Outlook: Stable operating performances and growing revenues Nýherji s operating performance is stable and revenues are growing Over the past twelve months the EBITDA was ISK 660 million was ISK 660 million Expectations are that the second half results will be at least as good as those of 2010
Nýherji hf. presentation for investors Q & A
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