Asiakastieto Group's Interim Report 1.1. - 30.9.2016: The brisk growth continued in the third quarter

02/11/2016

Asiakastieto Group Plc_Interim Report_Q3_2016

Asiakastieto Group Plc, stock exchange release, 2 November 2016 AT 12.00 EET

Asiakastieto Group's Interim Report 1.1. - 30.9.2016: The brisk growth continued in the third quarter

SUMMARY

The figures presented in this Interim Report are unaudited.

July - September 2016 in short:

-  Net sales amounted to EUR 11,7 million (EUR 10,5 million), an increase of 11,6 %.
-  Adjusted EBIT excluding non-recurring and other adjusted items was EUR 4,8 million (EUR 4,4 million), an increase of 8,7 %.
-  Operating profit (EBIT) was EUR 4,6 million (EUR 4,4 million). Operating profit included non-recurring expenses and other adjusted items of EUR 0,2 million (EUR 0,0 million).
-  The share of new products and services of net sales was 6,0 % (8,6 %).
-  The share of value-added services of net sales was 65,0 % (58,6 %).
-  Free cash flow amounted to EUR 5,2 million (EUR 3,9 million). The impact of non-recurring and other adjusted items on free cash flow was EUR -0,2 million (EUR -0,1 million).
-  Earnings per share were EUR 0,23 (EUR 0,22).

January - September 2016 in short:

-  Net sales amounted to EUR 36,5 million (EUR 32,4 million), an increase of 12,9 %.
-  Adjusted EBIT excluding non-recurring and adjusted items was EUR 14,8 million (EUR 13,4 million), an increase of 10,3%.
-  Operating profit (EBIT) was EUR 15,7 million (EUR 10,9 million). Operating profit included non-recurring expenses and other adjusted items of EUR 0,2 million (EUR 2,5 million) as well as EUR 1,1 million (EUR 0,0 million) non-recurring, adjusted profit on sale of office premises.
-  The share of new products and services of net sales was 8,2 % (8,5 %).
-  The share of value-added services of net sales was 64,9 % (59,3 %).
-  Free cash flow amounted to EUR 12,6 million (EUR 9,1 million). The impact of non-recurring and other adjusted items on free cash flow was EUR -0,3 million (EUR -2,9 million).
-  Earnings per share were EUR 0,80 (EUR 0,52).
-  Profit on non-recurring the sale of shares of office premises was EUR 1,1 million

Future outlook

Asiakastieto Group expects its net sales growth rate to exceed on annual level the last year's level. Adjusted euro-denominated net operating profit is expected to increase from last year, despite the new rental cost for 2016 caused by the eventual realization of office premises.

KEY FIGURES

  1.7.- 1.7.- 1.1.- 1.1.- 1.1.-
EUR million 30.9.2016 30.9.2015 30.9.2016 30.9.2015 31.12.2015
Net sales 11,7 10,5 36,5 32,4 43,7
Net sales growth, % 11,6 3,5 12,9 4,9 5,6
Adjusted EBITDA2 5,4 5,0 16,6 15,2 20,5
Adjusted EBITDA margin, %2 46,0 47,9 45,4 46,8 47,0
Adjusted operating profit (EBIT)2 4,8 4,4 14,8 13,4 18,3
Adjusted EBIT margin, %2 41,3 42,4 40,5 41,5 41,8
New products and services share of net sales, %1 6,0 8,6 8,2 8,5 8,6
Free cash flow3 5,2 3,9 12,6 9,1 13,8
Net debt to EBITDA, x 2,2 2,6 2,2 2,6 2,4

___________________________________________________________________
1 The method used for calculating the share of new products and services, the comparative figures for 1 July - 30 September 2015, 1 January - 30 September 2015 and the financial year 2015 have been changed into rolling starting from 1 January 2016, so that the share include sales of products, which have been launched during the past 24 months. Earlier the share was calculated from the sales of products launched during the previous and current financial year. Figures based on the old calculation method were 5,1 % for the third quarter 1 July - 30 September 2016, 8,1 % for the comparative period 1 July - 30 September 2015, 6,6 % for the interim period 1 January - 30 September 2016, 7,1 % for the comparative period 1 January - 30 September 2015 and 7,6 % for the financial year 2015.

2 Adjusted key figures are adjusted by following items: management fees which the Company has paid to Investcorp, the former owner of the Company, until the listing of the Company for certain ongoing advisory services, costs relating to the listing, an expense relating to the discount given to the personnel in the personnel offering, M&A related fees for legal and other advisory services, redundancy payments and compensations paid. The above listed adjusted items were EUR -0,2 million for the third quarter 1 July - 30 September 2016, EUR -0,0 million for the comparative period 1 July - 30 September 2015, EUR -0,2 million for interim period 1 January - 30 September 2016, EUR -2,5 million for the comparative period 1 January - 30 September 2015 and EUR -2,5 million for the financial year 2015. Adjusted key figures for the interim period 1 January - 30 September 2016 are also adjusted by the non-recurring profit on the sale of shares of office premises EUR 1,1 million.

3 The impact of adjusted items on free cash flow was EUR -0,2 million for the third quarter 1 July - 30 September 2016, EUR         -0,1 million for the comparative period 1 July - 30 September 2015, EUR - 0,3 million for the interim period 1 January - 30 September 2016, EUR -2,9 million for the comparative period 1 January - 30 September 2015 and EUR -2,9 million for the financial year 2015.

JUKKA RUUSKA, CEO

Asiakastieto Group's financial year 2016 in the third quarter continued with strong net sales growth. The net sales were EUR 11,7 million (EUR 10,5 million), growth from all four product areas being 11,6 % in total. The share of new services decreased to 6,0 percent of the net sales (8,6 %), which is due to ordinary fluctuation, when the period of examination of new services is relatively short. The development portfolio of new services is still strong.

Also profitability developed as expected. Irrespective of transferring to rented office premises and the data acquisition costs growing faster than the net sales, the adjusted operating profit increased by 8,7 %, being EUR 4,8 million in the third quarter (EUR 4,4 million).

In accordance with our reformed strategy, we will focus in the utilisation of so-called unstructured data during the remainder of the year, such as data collected from companies' websites and social media. An example of such data is decision-maker data collected from home pages. Here we are assisted by the strengthening brought on by the acquisition of Intellia Oy on 1 October 2016, which brings more expertise and new sales and marketing databases for the use of our clients.

A completely new way to process and test the applicability of data in business will be the test environment DataLab, the building work of which has begun. In DataLab also our clients and cooperation partners get to combine the data of Asiakastieto's developing core i.e. database into their own data materials and test their impact on each other. On the basis of experiences and results obtained from DataLab, we will develop new digital services for the use of our clients.

FUTURE OUTLOOK

Asiakastieto Group expects its net sales growth rate to exceed on annual level the last year's level. Adjusted euro-denominated net operating profit is expected to increase from last year, despite the new rental cost for 2016 caused by the eventual realization of office premises.

The outlook is subject to risks related to, among other factors, the development of the Finnish economy and the business operations of the Group. The most significant risks related to business operations include, for example, risks related to the success of product and service development activities, launches of new products and services and risks related to competitive tenders and to losing significant customer accounts.

Asiakastieto Group's business risks have been described in more detail on the Company's investor pages at investors.asiakastieto.fi.

Helsinki, on 2 November 2016

ASIAKASTIETO GROUP PLC
Board of Directors

For further information:
Jukka Ruuska, CEO
Asiakastieto Group Plc
tel. +358 10 270 7111

Distribution:
Nasdaq Helsinki Ltd
major media
investors.asiakastieto.fi