Continued improvements in growth and profitability
Oslo, 19 February 2016: Itera's IT hosting and consulting
activities in Norway and Denmark grew strongly with
signficant profitability improvements achieved. Itera's
nearshore activities also saw strong growth.
The Group reports operating revenue of NOK 113.1 million
(110.4) for the fourth quarter of 2015 and NOK 435.4 million
(439.8) for 2015 as a whole.
As in the previous quarters of 2015, Itera's consulting
activities in Sweden produced weak figures in the fourth
quarter. Keeping this unit is not regarded as important to
Itera's ability to realise its strategy, and it will be
closed with effect for accounting purposes from 1 February
2016. The business in question has operated on a stand-alone
basis in Sweden, meaning its closure will have no effect on
the Group's Nordic customers, as they are being served by
other units in the Group.
The Group experienced strong demand for its services and
achieved a high level of efficiency in the quarter. Pro
operating revenue excluding discontinued businesses (Itera's
IT hosting business in Sweden was sold with effect from 1
July 2015) was NOK 106.6 million (95.8) for the fourth
quarter, equivalent to growth of 11%. Pro forma operating
revenue for 2015 as a whole was NOK 394.2 million (379.5),
equivalent to growth of 4%.
The group's total operating costs were 7% lower in the
quarter of 2015 relative to the same period in 2014 at NOK
105.0 million (112.6). Pro forma operating costs were NOK
94.5 million (97.9) for the fourth quarter and NOK 366.3
million (371.5) for 2015 as a whole.
The operating result before non-recurring items (EBIT) for
the fourth quarter of 2015 was a profit of NOK 8.2 million
loss of NOK 2.2 million in Q4 2014). EBIT for 2015 as a
was NOK 20.1 million (3.8). Pro forma figures excluding
discontinued businesses show EBIT before non-recurring items
of NOK 8.8 million (-2.1) for the fourth quarter and NOK
million (4.0) for 2015 as a whole.
The fourth quarter has traditionally been the quarter with
the strongest cash flow from operations. Cash flow from
operations was NOK 30.1 million (46.8) for the fourth
of 2015 and NOK 20.8 million (45.8) for 2015 as a whole.
flow from operations for 2015 was NOK 19.7 million lower
EBITDA, which is largely due to higher accounts receivable
from customers due to growth and on-account invoicing
the end of the year not paid in the quarter. Cash flow from
operations for 2015 was also influenced by exceptionally
cash flow from operations in 2014.
The revenue from Itera's 30 largest customers grew by 11% in
the fourth quarter of 2015 and accounted for 72% of the
Group's operating revenue, up from 68% in the fourth quarter
"We are very satisfied with Itera's performance from
continuing operations, with double-digit pro forma revenue
growth. The Group's structure has been simplified, and we
now concentrating on reinforcing the strong progress we have
made", comments Arne Mjøs, CEO of Itera.
The Group experienced good order inflows in the fourth
quarter of 2015, with customers such as Eika Forsikring,
If Skadeforsikring, Santander, KLP, the Norwegian Public
Service Pension Fund and Bluegarden either extending
or entering into new agreements. These agreements span the
whole range of services offered by the group, from
consultancy and strategy through to IT hosting and
via design and development. The design and development
projects cover both business-critical core systems and
communications solutions for Itera's customers to use with
their own customers, existing as well as potential. The IT
hosting and management services to an increasing degree
involve setting up and hosting cloud-based platforms and
applications rather than more traditional technology.
The Group's headcount at the end of the fourth quarter of
2015 was 400 as compared to 445 at the end of the fourth
quarter of 2014. The decrease can largely be explained by
sale of Itera's IT hosting business in Sweden in the first
half of 2015 and the discontinuation of unprofitable
activities over the course of the year.
The proportion of Itera's capacity that is located nearshore
(its nearshore ratio) was 33% (29%) at the end of the fourth
quarter. The Group's development centre in Bratislava
provides great flexibility with regard to meeting the target
of achieving a nearshore ratio of 50% in the future.
For more information:
Arne Mjøs, CEO
+47 905 23 172
Bent Hammer, CFO
+47 982 15 497