- Net sales totalled EUR 467.1 (461.6) million, an increase of 1%.
- Order intake at EUR 468 (596) million. Order backlog at EUR 1 719 (1 708) million at the end of the period.
- Operating profit (EBIT) amounted to EUR 41.7 (23.6) million, including capital gains of EUR 15.4 million. Operating margin stood at 8.9% (5.1).
- Operating profit excluding one-off items stood at EUR 28.0 (23.9) million, representing an operating margin of 6.0% (5.2).
- Profit after taxes was EUR 32.0 (13.5) million.
- Net cash flow from operations amounted to EUR 69.3 (38.8) million.
- New strategy for 2012–2016 launched. Personnel negotiations proceeded according to the plan. The profitability improvement starts to materialize towards the end of 2012.
Full-year outlook for 2012 unchanged – second-quarter results assume restructuring costs
The full-year outlook for 2012 remains unchanged. Tieto expects its net sales to develop in line with the anticipated growth rate for the Western European IT services market, i.e. 0–2%. Full-year operating profit (EBIT) excluding one-off items is expected to be above the previous year’s level (EUR 117.1 million in 2011).
The second quarter will be strained by anticipated one-off costs of around EUR 30 million. These costs are part of the total streamlining costs of EUR 50 million announced in connection with the strategy launch. Additionally, existing idle capacity of the company is expected to burden second-quarter performance. The profitability improvement attributable to the ongoing streamlining actions starts to materialize towards the end of 2012.
|Net sales, EUR million||467.1||461.6|
|Change in net sales, %||1||9|
|Operating profit (EBITA), EUR million||43.2||25.5|
|Operating margin (EBITA), %||9.3||5.5|
|Operating profit (EBIT), EUR million||41.7||23.6|
|Operating margin (EBIT), %||8.9||5.1|
|Operating profit (EBIT) excl. one-off items,
|Operating margin (EBIT) excl. one-off items, %||6.0||5.2|
|Profit after taxes, EUR million||32.0||13.5|
|Net cash flow from operations, EUR million||69.3||38.8|
|Return on equity, 12-month rolling, %||14.7||9.9|
|Return on capital employed, 12-month rolling, %||20.8||16.1|
|Investments, EUR million||14.4||65.3|
|Interest-bearing net debt, EUR million||11.7||76.2|
|Personnel on 31 March||18 121||18 136|
Kimmo Alkio, President and CEO:
“The first-quarter performance was well in line with our short-term plans and this has given us a good start for the year. Our operating profit was boosted by a capital gain related to the divestment of financial services products business in the UK, while the underlying profitability also improved from the previous year.
We are placing extensive emphasis on implementing our operational priorities for 2012. Quality consistency is our number one priority across all services. I’m pleased to see initial signs of improving visibility to our customers service experience across Tieto. Importantly, we have also initiated customer specific innovation forums in our core markets to drive new services and user experiences – such as new consumer applications across numerous industries.
Our recently launched strategy plays an important role in setting new direction for the company. The choices in our strategy provide for inspiring opportunities in our chosen industries and markets. In the initial stages of implementation we are naturally challenged with the restructuring activities taking place during 2012.
Based on positive customer and employee feedback on the renewed direction, we are confident to begin the strategy implementation. Our expanded service offering and sharpened geographical focus coupled with the cost competitiveness programme are anticipated to improve operating profit as from the second half of 2012.”
FINANCIAL PERFORMANCE IN JANUARY–MARCH
Financial performance by market unit
|Net sales Q1/2011, EUR million||Change, %||Operating margin Q1/2012, %||Operating margin Q1/2011, %|
|Finland and the Baltic countries||193||184||5||9.0||7.3|
|Central Europe & Russia||34||31||7||-12.5||-15.9|
For further information, please contact:
Lasse Heinonen, CFO, tel. +358 2072 66329, +358 50 393 4950, lasse.heinonen (at) tieto.com
Tanja Lounevirta, Acting Head of Communications and IR, tel. +358 50 321 7510, tanja.lounevirta(at)tieto.com
Press conference for analysts and media will be held at Tieto’s premises in Helsinki, address: Aku Korhosen tie 2‑6, at 2.30 pm EET (1.30 pm CET. 12.30 pm UK time). The results will be presented in English by Kimmo Alkio, President and CEO.
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.
NASDAQ OMX Helsinki
NASDAQ OMX Stockholm
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
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
Tieto Q1-2012 interim report.pdf