| Strong profitability and growth potential at EDB |
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(Oslo, 29 April 2004) EDB reports operating revenue of NOK 1,036 million with operating profit (EBITA) of NOK 79 million for the first quarter of 2004 as compared to operating revenue of NOK 1,058 million and operating profit of NOK 42 million for the same period in 2003. After adjusting for businesses purchased and sold and activities discontinued, revenue is in line with the first quarter of 2003, while profitability is significantly improved. The group's cash flow is strongly improved compared to the same period in 2003. EDB signed new contracts in the first quarter representing total business volume of over NOK 8 billions. This helps to give a more predictable level of future turnover and creates greater potential for long-term growth in the Nordic region. Operating profit for the quarter represents an operating margin (EBITA) of 7.6% as compared to 4% in the same quarter of 2003. All business areas reported higher EBITA margins than in the first quarter of 2003.
EDB generated positive cash from operations of NOK 52 million in the first quarter as compared to a cash outflow of NOK 198 million in the first quarter of 2003. This improvement is primarily a result of stronger profitability and improved payments profile related to software-licences.
"With a record level of new business, profitability almost doubled and a sharp improvement in cash flow, the first quarter results are very pleasing", comments CEO Endre Rangnes.
All business areas reported improved results for the first quarter. IT Operations generated operating revenue of NOK 712 million in the first quarter, up by NOK 10 million from 2003. Operating profit (EBITA) of NOK 60 million (NOK 51 million in 2003) and EBITA margin of 8.4% (7.3%) are the result of continuous focus on costs. The Bank & Finance business area reported operating revenue of NOK 196 million (NOK 193 million) and operating profit (EBITA) of NOK 18 million (loss of NOK 14 million) giving an EBITA margin of 9.3% (- 7.5%). The Telecommunications business area, reporting for the last time including the activities now sold to Accenture, saw operating revenue of NOK 153 million (NOK 134 million) with operating profit (EBITA) of NOK 12 million (NOK 10 million). This represented an EBITA margin of 8.1% (7.7%).
After adjusting for businesses purchased and sold and activities discontinued, revenue was little changed from 2003 for the IT Operations and Telecommunications business areas while Bank & Finance achieved a 3.5% increase in revenue.
"The whole group is now reporting stronger profitability and has a good hold on the market. We are particularly pleased to see the Bank & Finance business area report increased revenue and sound profitability. The contracts signed in the first quarter with DnB NOR, Apoteket and Telenor confirm our competitiveness and help to give a more predictable level of future turnover as well as paving the way for stronger long-term growth in the Nordic region" adds Endre Rangnes.
The parent company reported an operating loss of NOK 11 million (loss of NOK 4 million) in the first quarter, while goodwill depreciation amounted to NOK 37.5 million as compared to depreciation of NOK 36.6 million and write-downs of NOK 4 million in the same period of 2003. Operating profit (EBIT) for the first quarter was therefore NOK 42 million as compared to NOK 2 million in the first quarter of 2003.
Net financial items represented a charge of NOK 16 million as compared to NOK 17 million in the same quarter last year.
EDB reports a profit for the quarter after tax and minority interests of NOK 17.9 million as compared to a loss of NOK 11 million in the same quarter last year. Earnings per share amounts to NOK 0.20 as compared to a loss per share of NOK 0.12 in the same quarter of 2003.
More detailed financial information can be found in the interim report provided as an appendix to this announcement.
Presentation of 1st Quarter 2004 can be downloaded from the following link: http://hugin.info/194/R/943315/132065.pdf
1st Quarter Report 2004, inclusive financial tables can be downloaded from the following link:
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