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ARCHIVE 2006
ALDATA SOLUTION INTERIM REPORT JANUARY - DECEMBER
2005 (unaudited)
Aldata Solution Oyj STOCK EXCHANGE RELEASE February
14, 2006, at 9.40 a.m. (EET)
Strong growth and improved profits
Aldata in 2005 (IFRS)
# Net sales grew by 27% to EUR 76.0 million (EUR 66.1 million,
comparable EUR 59.8 million). The most significant growth took
place in product sales.
# Gross profit grew by 36% to EUR 63.1 million (comparable EUR
46.5 million) .
# Operating profit, EBIT, was EUR 5.2 million, a EUR 9.9 million
comparable increase.
# Profit before taxes was EUR 5.5 million (EUR -1.0 million).
# Net profit was EUR 3.4 million (EUR -4.0 million) and earnings
per share, EPS, were 0.050 (-0.059) euros.
# Order backlog at year end was EUR 20.7 million (EUR 18.0 million
at end of 2004 and EUR 18.9 million at end of Q3 2005).
# Cash-flow from operating activities was EUR 4.5 million (EUR
-4.2 million) and cash and cash equivalents at year end were EUR
9.4 million (EUR 6.5 million at end of 2004 and EUR 5.2 million
at end of Q3 2005).
Comparable figures have been adjusted in relation to the divestment
of Aldata Industries Oy, which was sold in December 2004.
Aldata in Q4 2005 (compared to Q4 2004)
The quarterly numbers are prepared according to Finnish accounting
standard (FAS).
# Net sales increased 28% to EUR 21.3 million (EUR 18.1 million,
comparable EUR 16.7 million).
# Gross profit increased 39% to EUR 18.2 million (EUR 17.7 million,
comparable EUR 13.1 million).
# Operating profit, EBIT was EUR 2.1 million (EUR 3.5 million,
comparable EUR -0.4 million).
# Profit before taxes was EUR 2.0 million (EUR 3.4 million).
# Net profit was EUR 1.4 million (EUR 0.3 million) and earnings
per share, EPS, were 0.021 (0.004) euros.
Market overview
During 2005, an improvement in the application software market
became more visible. Companies are investing in tools to improve
their efficiency and the demand for business software has steadily
increased.
In the retail and logistics verticals, where Aldata's focus is,
the penetration of standard application software is still at a
low level. An increasing number of retail chains and logistics
companies are contemplating a move from proprietary IT systems
to packaged solutions. Aldata, being one of the very few suppliers
of such solutions, is to benefit strongly from this trend.
The increased activity in the retail and logistics verticals has
attracted also large, diversified software vendors to enter the
area. This has resulted in a consolidation among Aldata's competitors
and peers. However, Aldata's long experience and deep knowledge
within these verticals and strong track-record of successful implementations
with the world's leading retailers, give confidence for the future.
In 2005 Aldata grew significantly faster than its competitors
and peers. Aldata expects to continue gaining market share in
all its markets.
January - December 2005 financial performance (IFRS)
Aldata's net sales were EUR 76.0 million (EUR 66.1 million, comparable
EUR 59.8 million), which represents organic growth of 27% over
the previous year's comparable net sales (comparable figures exclude
Aldata Industries Oy, which was divested in December 2004). The
growth was strongest in the US and the UK. France and Finland
were the largest geographical markets, representing 31% and 13%
of total net sales.
Product sales, which include licenses on standard products, licenses
on customer specific developments and maintenance revenues, accounted
for 42% (35%). Consulting services, which include project work,
integration and training services accounted for 51% (49%). Third
party licenses and hardware accounted for 7% (16%).
The Group's gross profit was EUR 63.1 million (comparable EUR
46.5 million), which represents an 83% (78%) gross margin. The
increase in the gross margin is attributable to an improved sales
mix.
Operating profit, EBIT, totaled EUR 5.2 million (comparable EUR
-4.7 million), which represents a 6.9% operating margin. The strong
growth in operating profit proves that Aldata's business model
brings significant scale benefits as the net sales increase.
Pre-tax profit was EUR 5.5 million (EUR -1.0 million), net profit
was EUR 3.4 million (EUR -4.0 million) and earnings per share,
EPS, were 0.050 euros (-0.059 euros).
Research and developments costs in the financial year totaled
EUR 16.4 million (EUR 15.2 million), of which EUR 0.6 million
(EUR 0.4 million), or 3.9 %, were capitalized. The depreciation
on capitalized development costs was EUR 0.1 million (EUR 0.0
million). Before 2004 all development costs were booked as expenses.
Costs related to stock options were EUR 0.5 million (EUR 0.2 million).
The operating costs also include a EUR 0.4 million non-recurring
item related to the change of Aldata Group's President and CEO.
Taxes for the financial year were EUR 2.0 million (EUR 3.0 million)
and tax rate was 36%.
Aldata's reported order backlog includes product and third party
product sales, which will be recognized as revenues during the
following twelve months. At year-end 2005 Aldata's order backlog
was EUR 20.7 million (EUR 18.0 million at the end of 2004 and
EUR 18.9 million at the end of Q3 2005).
Fourth quarter 2005 financial performance
All presented quarterly numbers are prepared according to Finnish
accounting standard (FAS) and comparable figures are fourth quarter
2004 figures.
Aldata's net sales were EUR 21.3 million (EUR 18.1 million, comparable
EUR 16.7 million), which represents comparable growth of 27% (comparable
figures exclude Aldata Industries Oy, which was divested in December
2004).
Product sales, which include licenses on standard products, licenses
on customer specific developments and maintenance revenues, accounted
for 45% (38%). Consulting services, which include project work,
integration and training services accounted for 48% (46%). Third
party licenses and hardware accounted for 7% (16%).
The Group's gross profit was EUR 18.2 million (EUR 17.7 million,
comparable EUR 13.1 million). Operating profit, EBIT, totaled
EUR 2.1 million (EUR 3.5 million, comparable EUR -0.4 million).
Net profit was EUR 1.4 million (EUR 0.3 million) and earnings
per share, EPS, were 0.021 (0.004) euros.
Net sales of the Supply Chain Management (SCM) Software business
unit grew by 40% to EUR 18.2 million (EUR 13.0 million). The gross
profit was EUR 15.7 (EUR 10.1) million and the operating profit,
EBIT, was EUR 1.8 (EUR 0.3) million.
Net sales of the In-Store Software business unit decreased to
EUR 3.1 million (EUR 3.6 million). The gross profit was EUR 2.5
million (EUR 3.0 million) and the operating profit, EBIT, was
EUR 0.3 (EUR 0.0) million.
Finance and investments
At the end of 2005 Aldata Group's cash, cash equivalents and marketable
securities amounted to EUR 9.4 million (EUR 6.5 million at the
end of 2004) and the balance sheet total stood at EUR 48.5 million
(EUR 40.6 million). The Group had EUR 0.3 million interest-bearing
debt (EUR 0.2 million) and interest-bearing net liabilities totaled
EUR -8.7 million (EUR -6.0 million). Short-term receivables totaled
EUR 26.9 million (EUR 22,2 million). The Group's solvency ratio
was 54.1% (54.0%), gearing was -34.4% (-27.6%), and shareholders'
equity per share was EUR 0.372 (EUR 0.317).
The Group's capital expenditure on hardware and software purchases
amounted to EUR 1.3 million (EUR 1.1 million). A total of EUR
0.6 million (EUR 0.3 million) development costs were capitalized
during the period.
IFRS reporting
Aldata transferred to reporting according to International Financial
Reporting Standards (IFRS) in 2005. The comparative 2004 full-year
figures in this report are according to IFRS. Preliminary information
of the changes was published on January 31st, 2006.
The essential differences between FAS and IFRS are in net sales,
capitalization of product development expenses, share option expenses
and goodwill amortization.
Net sales has increased EUR 0.4 (EUR 0.1) million as items previously
recorded under other operating income are in IFRS accounting recorded
as net sales.
The capitalization of development costs were EUR 0.6 (EUR 0.4)
million and the depreciation of these expenses was EUR 0.1 (0.0)
million.
The impact of share option expenses is included in personnel expenses
in the profit and loss statements and it reduces the 2005 operating
profit EUR 0.5 (EUR 0.2) million.
The amount of scheduled amortization in FAS has been adjusted
in the IFRS-compliant profit and loss account and it improves
the operating profit EUR 0.7 (EUR 0.8) million. The company's
goodwill is regularly tested according to IFRS impairment test
guidelines.
Business units
Net sales of the Supply Chain Management (SCM) Software business
unit grew by 35% to EUR 64.1 million (EUR 47.3 million). The gross
profit was EUR 53.6 (EUR 32.6) million and the operating profit,
EBIT, was EUR 7.0 (EUR -2.9) million. The positive development
of the business unit is attributable to a number of successful
Aldata G.O.L.D. implementations and to the launch of a number
of new G.O.L.D. modules. The unit has been very successful in
its international expansion and the strongest growth has taken
place in Asia and the US. There is a continued focus on international
expansion and the strongest growth in 2006 is expected from the
growing markets of Asia, Middle-East, Russia, China and the US.
Parallel to the international expansion the unit is launching
new products, to fulfill the ever increasing requirements by its
customers. All new products are based on Aldata G.O.L.D. technology
and are integrated modules of the G.O.L.D. suite, which already
today represents the most comprehensive offering on the market
for supply chain execution.
Net sales of the In-Store Software business unit decreased to
EUR 11.9 million (EUR 12,5 million). The gross profit was EUR
9.6 million (EUR 9.7 million) and the operating profit, EBIT,
was EUR 0.0 (EUR 0.1 ) million. In Finland, the In-Store unit
has been significantly increasing its sales and has further strengthened
its leading position as a supplier of point-of-sales solutions
for Finnish retail chains. Also in terms of profitability, the
Finnish unit has performed very well and restructuring measures
taken at the end of 2004 have significantly improved the efficiency
of the unit. However, performance in rest of the Nordic region
has been weaker than expected, but towards the end of 2005, the
performance in this area has improved as well.
According to IFRS unallocated expenses are reported separately
from segment reporting. In 2005 Aldata Group's unallocated expenses
totaled EUR 1.8 million (EUR 1.9 million).
Research and Development
Aldata's research and development costs were EUR 16.4 million
(EUR 15.2 million), which is 22 (23%) percent of net sales. Costs
grew by 7.7 per cent during the year. A total of EUR 0.6 million
(EUR 0.4 million) of development costs were capitalized during
the period. The depreciation on capitalized development costs
was EUR 0.1 million (EUR 0.0 million). Before 2004 all research
and development costs were booked as expenses.
At the end of the review period 211 (189) employees were involved
in R&D activities, which represents 36% of the Group's total
personnel. Aldata's R&D centers are located in Paris, France,
and in Vantaa, Finland.
Personnel
Aldata Group employed 580 (514) persons at the end of 2005 and
on average had 547 (525) employees during the year. The personnel
growth rate was 20% in the Supply Chain Management Software business
unit, whereas the number of personnel declined by 4% in the In-Store
Software business unit. Geographically, the growth was strongest
in Aldata subsidiaries in the US and the UK.
By Business Units
Approximately 53% of personnel were employed by Aldata companies
in France, 14% in Finland, 13% in Germany, 8% in Sweden, 5% in
Slovenia, 4% in the US and 3% in the UK.
Aldata share
The highest price of the Aldata Solution Oyj share during January
- December 2005 was 2.07 EUR and the lowest price 1.07 EUR. The
average price was 1.56 EUR and the closing price 1.85 EUR. The
trading volume on the Helsinki Stock Exchange was EUR 69.3 million
and altogether 44.2 million shares were traded, which represents
65.6% of the shares. Aldata Solution Oyj has 67.4 million shares
outstanding. The number has remained unchanged during the period.
The number of shareholders was 5886 and the free float was 99.7%
of the share capital at the end of September 2005. A total of
51.7% of Aldata Solution Oyj's shares were nominee registered
at the end of the period.
Events after the review period
On January 2nd 2006, Aldata announced an agreement with Carrefour,
the second largest retailer worldwide, regarding the supply of
the Aldata G.O.L.D. software suite to Carrefour's 179 hypermarkets
in France.
On January 9th 2006, Aldata announced an agreement with the United
Supermarkets from the US, regarding the supply of the full suite
of Aldata G.O.L.D. applications for its stores in North and West
Texas.
The Board of Directors' dividend proposal
The Board of Directors will propose to the Annual General Meeting
on April 6th that no dividend shall be distributed. The Board's
opinion is that profits should be re-invested in Aldata's business
operations, where they can generate high returns and support an
aggressive growth strategy. Also, financial flexibility opens
up opportunities for Aldata in the currently very fast developing
and actively consolidating retail software market.
Outlook for 2006
Aldata expects its good financial performance, strong growth in
net sales and increased profitability, to continue also in 2006.
The growth on net sales is supported by new product launches,
the improved market environment and increased presence in Asia,
Latin-America, Middle-East and in the US. The increase in profit
margins is supported by Aldata's business model, where significant
scale benefits are realized as net sales increase.
This report has been prepared according to IFRS (International
Financial Reporting Standards). The quarterly figures are presented
according to FAS (Finnish Accounting Standard).
Helsinki, February 14, 2006
Aldata Solution Oyj
Board of Directors
The audited financial report will be published in Finnish and
English on the Group's web site
www.aldata-solution.com week 10. The printed English version of
Annual Report will be published week 14.
Further information:
Aldata Solution Oyj, René Homeyer, President and CEO, tel.
+33 683 810 888
Aldata Solution Oyj, Thomas Hoyer, CFO, tel. +358 45 670 0491
Aldata will arrange a press conference for media and financial
analysts in Helsinki on 14th February, at 12.00 (EET) in Hotel
Simonkenttä (Simonkatu 9, 00100 Helsinki) in the Espa cabinet
on the ground floor.
The presentation material will be published on the Group's web
site www.aldata-solution.com
Aldata in brief
Aldata Solution is one of the global leaders in supply chain execution
software for retail, wholesale and logistics companies. The company's
comprehensive range of Supply Chain Management and In-Store solutions
enable its more than 300 customers across 50 countries to enhance
productivity, profitability, performance and competitiveness.
Aldata develops and supports its software through more than 500
Aldata professionals and a global partner network. Aldata is a
public company quoted on the Helsinki Stock Exchange with the
identifier ALD1V. More information at: www.aldata-solution.com
Distribution:
OMX Helsinki Stock Exchange
Media
APPENDICES
1 Consolidated Income Statement
2 Consolidated Balance Sheet
3 Consolidated Cash Flow
4 Commitments and Contingencies
5 Key Figures
6 Segment report
Interim Report January - December 2005
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