results first half year 2004
DESCRIPTION
Results first half year 2004. Henk Bosma, CEO Amsterdam, 26th August 2004. Strategy Results first half year 2004. Agenda. Strategy. Major full service provider in Dutch ICT-market (“national champion”) Profitable services in infrastructure management in UK ICT-market (“niche player”) - PowerPoint PPT PresentationTRANSCRIPT
26th August 2004 - Results first half year 2004
1
Results first half year 2004
Henk Bosma, CEO
Amsterdam, 26th August 2004
26th August 2004 - Results first half year 2004
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Agenda
• Strategy
• Results first half year 2004
3 26th August 2004 - Results first half year 2004
Strategy
26th August 2004 - Results first half year 2004
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Strategy
• Major full service provider in Dutch ICT-market
(“national champion”)
• Profitable services in infrastructure management in UK
ICT-market (“niche player”)
• No reasons for a change of strategy for the time being
26th August 2004 - Results first half year 2004
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Consolidation
• Questions:
• Will the consolidation tendency go on?
• At which pace?
• Will it affect PinkRoccade?
• Answers:
• Yes, likely
• It will take another 3 to 5 years
• It will affect every full service provider so we will watch developments
carefully and take steps when necessary
• Conclusion: It is of the highest importance to improve
the results of the company shortly, not to spend a lot of
energy on other matters
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Consequences
• PinkRoccade will strengthen its commercial ability and
at the same time reduce the costs further
• PinkRoccade will restructure its organisation from a
business unit model to a functional model with a strong
market orientation
• PinkRoccade is looking actively for a successor of the
present CEO who will retire by mid 2005
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Results first half year 2004
26th August 2004 - Results first half year 2004
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Highlights
• Net revenues euro 347.0 million (H1 2003 euro 372.1
million)
• Operating profit euro 5.1 million (H1 2003 euro 15.4
million)
• Net profit euro 1.9 million (H1 2003 euro 7.5 million)
• Net profit per share euro 0.08 (H1 2003 euro 0.31)
• As expected, the first indications for market recovery
became visible during Q2 2004
• Pent up demand is a driver of this recovery
• Improving utilisation rates in time and material business
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Financials
26th August 2004 - Results first half year 2004
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Revenue assessment H1 2004
Revenue decreased 6.7% compared to H1 2003
0
50
100
150
200
250
H1 01: 397 H1 02: 419 H1 03: 372 H1 04: 347
Q1
Q2
Q3
Q4
175172
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1st half year 2004 (Euro 347 mln)
32%
15%15%
16%
7%
15% Central Government
Local Government
Finance
Industry
Healthcare
International
1st half year 2003 (Euro 372 mln)
34%
16%14%
16%
6%14%
Revenue in vertical markets
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Analysis by vertical markets
H1 2004 H1 2003
Central Government 111,7 124,3 -10,1%Local Government 51,1 61,0 -16,2%Finance 52,3 52,5 -0,4%Industry 57,4 60,9 -5,7%Healthcare 22,5 21,1 6,6%International 52,0 52,3 -0,6%Total 347,0 372,1 -6,7%
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Revenue developments
• Decrease in total revenue of 6.7%
• Decrease in second quarter 5.7%, in first quarter 7.7%
• Revenue per FTE increased with approx. 2% in
comparison with H1 2003
• Netherlands: continuous increase in Healthcare,
decrease in Central and Local Government
• UK: stabilisation of revenue
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Recurring business > 65%
• Percentage of recurring business stable
• Movements in recurring contracts H1 2004
• Several new contracts in H1 2004, total annual income
approx. 30 mln (a.o. NBTC, Securicor, ProRail)
• In Q3 2004 YTD new contracts with a.o. VROM (total
annual income approx. 15 mln)
mln mln
Contracts to be renewed in 2004 110
Settled in H1 65
Lost contracts and loss of volume 11
Running 34
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EBITA assessment 2004(prior years adjusted)
-5
0
5
10
15
20
H1 01: 31.8 H1 02: 12.0 H1 03: 17.3 H1 04: 7.3
Q1
Q2
Q3
Q4
4.33.0
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EBITA – EBITAE reconciliation
EBITAE = Earnings before Interest, Taxes, Amortisation of goodwill and Exceptional Items
H1 04 H1 03NL UK Total NL UK Total
Revenue 295,8 51,2 347,0 321,3 50,8 372,1
EBITA 10,2 2,9- 7,3 16,8 0,5 17,3 3,4% -5,7% 2,1% 5,2% 1,0% 4,6%
Exceptionals Sale and lease back 3,5 3,5 3,4 3,4 Rightsizing 1,7- 1,1- 2,8- - Restructuring portfolio 4,4- 4,4- -
2,6- 1,1- 3,7- 3,4 - 3,4
EBITAE 12,8 1,8- 11,0 13,4 0,5 13,9 4,3% -3,5% 3,2% 4,2% 1,0% 3,7%
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Net profit assessment 2004(prior years adjusted)
-4
-2
0
2
4
6
8
10
12
H1 01: 18.1 H1 02: 0.3 H1 03: 7.5 H1 04: 1.9
Q1
Q2
Q3
Q4
0.6
1.3
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-2000
0
2000
4000
6000
8000
10000
Growth 1717 0 360 274
Per 01/01 7722 9439 8147 7436
Attrition -1056 -1292 -1071 -593
2001 2002 2003 2004
Number of employees
9439 74368147 7117
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Profit & Loss Statement H1 2004 (mln euro) Q1 2004 Q2 2004 H1 2004 H1 2003Revenue 174,6 172,4 347,0 372,1Revenue per employee (FTE) 25,3 25,6 50,9 50,0
Operating profit (EBITDA) 8,2 10,7 18,9 31,0Operating profit (EBITDAE) 9,6 13,0 22,6 27,6Operating profit (EBITA) 3,0 4,3 7,3 17,3Operating profit (EBITAE) 4,4 6,6 11,0 13,8Operating profit (EBIT) 2,0 3,1 5,1 15,4EBITA margin 1,7% 2,5% 2,1% 4,6%EBITAE margin 2,5% 3,8% 3,2% 3,7%
Net profit (before amortisation) 1,6 2,5 4,1 9,5Net profit 0,6 1,3 1,9 7,5Earnings/share (before amortisation) 0,07 0,10 0,17 0,39Earnings/share 0,02 0,06 0,08 0,31Average # shares (mln) 24,4 24,5 24,4 24,2
Cashflow from operations 4,6 -6,7 -2,1 20,8
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Balance sheet(mln euro) 30-6-2004 31-12-2003Intangible Fixed Assets 67,6 69,8Fixed Assets 58,7 72,6Stock 5,5 2,9Debtors and amounts to be invoiced 139,3 129,6Current Assets 36,3 32,2Cash & Cash equivalents 10,6 9,0Total Assets 318,0 316,1
Equity 136,5 136,5Provisions 6,7 12,4Long term liabilities 5,6 6,1Current liabilities 169,2 161,1Total liabilities 318,0 316,1
Equity / total liabilities 42,9% 43,2%Equity/ total liabilities (classic) 27,5% 27,1%
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Provisions
31-dec-03 Additions Disposals 30-jun-04
Pensions and related 2.335 728 1.607
Group structuring 8.793 1.900 6.054 4.639
Guarantees 1.259 450 1.259 450
12.387 2.350 8.041 6.696
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Cashflow statement H1 2004
(mln euro) Q1 2004 Q2 2004 H1 2004 H1 2003Cashflow from operations 4,6 -6,7 -2,1 20,8Cashflow from investments -5,3 11,1 5,8 11,0Cashflow from financing 0,7 -2,8 -2,1 -27,8
Total cashflow 0,0 1,6 1,6 4,0
Banks start period 9,0 9,0 9,0 -28,4Banks end period 9,0 10,6 10,6 -24,4
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Developments
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Developments (1)
Netherlands:
• First half year remained difficult, however first indication
of market recovery became visible
• In time and material business, tariffs and utilisation ratios
have increased, mainly in Infrastructure Management
• Developments in Central Government as expected,
reduction of sales because no large outsourcingdeals
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Developments (2)
Netherlands:
• Local Government market suffering from spending cuts
and fewer changes in regulations
• In Finance and Industry market, not yet full benefit of
improving market due to fixed price contracts
• Healthcare market shows steady growth and stable
margins
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Developments (3)
UK:
• Net revenue stable
• Large new contract with Securicor (euro 60 mln over 7
years) in Q1
• As from June on, operating profit (EBITAE) is positive
on a monthly basis
• Restructuring on schedule
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Outlook
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Outlook
• First indications of market recovery; trend expected to
continue
• However, Q3 will be weak due to usual seasonal effects
• Market for outsourcing remains attractive
• Revenue decline will continue to slow off during H2
• No indication of profit level because of uncertainty about:
• Developments in local government market
• Moment of building the provision for the costs of the organisational
transformation
29 26th August 2004 - Results first half year 2004
Results Q3 2004 :
November 11, 2004