DIGIA PLC Q1/2014: NET SALES GREW AND THE RESULT IMPROVED SLIGHTLY
DIGIA PLC INTERIM REPORT 30 APRIL 2014, 09:00 A.M.
DIGIA PLC Q1/2014: NET SALES GREW AND THE RESULT IMPROVED SLIGHTLY
SUMMARY
January-March
- Consolidated net sales: EUR 24.0 (23.5) million, up 1.9 per cent
- Operating profit: EUR -0.3 (-0.5) million
- Profitability (EBIT%): −1.2 (-2.0) per cent
- Product business accounted for 40.6 (37.5) per cent
- Earnings per share: EUR −0.02 (-0.02)
The consolidated net sales and the result for the period improved slightly from the previous year’s comparison figures.
The growth in net sales was due to the Qt business, whose net sales increased by 20.8 per cent compared to the same period in the previous year. As expected, however, the Qt business made a loss during the period; this was due to significant, target-oriented investments aimed at developing the business.
Net sales from domestic operations fell slightly from the comparison period. The profitability of the operations was also lower than hoped for. The domestic business also saw investments aiming to increase sales in the future, which had a negative impact on the review period’s net sales and profitability.
The company expects demand to remain generally good in all domestic business areas, and that income from operations and operational profitability will improve as the year progresses.
The company estimates that net sales from the Qt business will grow markedly in 2014 compared to 2013. Significant investments will continue in developing the Qt business and Qt technology, while the company will reinforce its sales network, especially in Asia. Investments aimed at securing growth will continue to burden profitability.
Overall, the company predicts its consolidated net sales for 2014 to grow organically at a rate exceeding that of the general market. Further investments in growing the Qt business will continue to hold back the whole company’s profitability.
GROUP KEY FIGURES AND RATIOS
| Q1/2014 | Q1/2013 | Change,% | |
| Net sales | 23,958 | 23,513 | 1.9% |
| Operating profit before extraordinary items | -280 | -473 | 40.7% |
| - % of net sales | -1.2% | -2.0% | |
| Operating profit | -280 | -473 | 40.7% |
| - % of net sales | -1.2% | -2.0% | |
| Net profit | -331 | -472 | 29.9% |
| - % of net sales | -1.4% | -2.0% | |
| Return on equity, % | -3.8% | -9.8% | |
| Return on capital invested, % | -1.6% | -2.7% | |
| Interest-bearing liabilities | 16,873 | 19,114 | -11.7% |
| Cash and cash equivalents | 2,652 | 6,617 | -59.9% |
| Net gearing | 42.4% | 31.3% | |
| Equity ratio (%) | 48.7% | 50.3% | |
| Earnings per share, undiluted, EUR | -0.02 | -0.02 | |
| Earnings per share, diluted, EUR | -0.02 | -0.02 |
MARKETS AND DIGIA’S BUSINESS OPERATIONS
Domestic Segment
There was a strong focus on growth in the business comprising integration, analytics and workforce management. Demand for services was good in the period, but the profitability of the business was negatively affected by growth investments and, to some extent, increasing price competition.
Demand for ERP systems was also good in the review period, although there were significant sector-specific differences. Sales cycles remained long, but the order book and bid volumes were healthy.
Market uncertainty was most clearly reflected in the business for tailored solutions and services, where the cost pressure endured by customers significantly hamper the profitability of the business. However, demand for services has remained relatively good, even though customers’ decision-making processes have lengthened and many projects have been broken down into smaller orders. Again, there were clear sector-specific differences in demand.
Qt Segment
The Qt business progressed well and its like-for-like net sales grew strongly compared to the same period in the previous year. Demand and bid volumes were both good. There were no individual deals with a significant impact on net sales in the period.
The Qt business made a loss during the period; this was due to significant, target-oriented investments aimed at developing the business.
The focus of Qt operations was primarily on licence sales, which meant that the product business accounted for significantly more than the target level of 75 per cent of net sales.
During the period, the company continued fulfilling previously reported plans related to Qt product development and areas of focus. The network of distributors expanded to Korea during the period, and efforts were made to strengthen sales to the large enterprises customer segment and European sales.
NET SALES
Digia’s consolidated net sales for the reporting period were EUR 24.0 (23.5) million, up 1.9 per cent on the same period in 2013.
Net sales from the domestic segment for the review period totalled EUR 19.2 (19.6) million, which was down 1.9 per cent. Net sales from the Qt segment for the review period totalled EUR 4.8 (4.0) million, up 20.8 per cent.
The consolidated net sales for the period improved slightly from the previous year’s comparison figures. The rise was due to growth in the Qt business. The slight decline in domestic net sales was partly due to the lack of income from local operations in Russia, which were shut down in 2013. The domestic business also saw investments that aimed to increase sales in the future, which had a negative impact on the billing rate and consequently the net sales.
During the reporting period, the product business accounted for EUR 9.7 (Q1/2013: 8.8) million or 40.6 (37.5) per cent of consolidated net sales.
International operations accounted for EUR 4.8 (Q1/2013: 4.4) million or 19.9 (18.6) per cent of consolidated net sales.
PROFIT PERFORMANCE AND PROFITABILITY
Digia’s consolidated operating profit for the reporting period was EUR −0.3 (-0.5) million. Profitability (EBIT%) was -1.2 (-2.0) per cent.
Operating profit from domestic operations for the reporting period totalled EUR 0.6 (0.4) million, up 44.5 per cent, and the segment’s profitability (EBIT%) was 3.4 (2.3) per cent.
Operating profit from Qt operations for the reporting period was EUR -0.9 (-0.9) million. The segment’s profitability (EBIT%) was -19.4 (-23.3) per cent.
The domestic operating profit fell short of targets during the period. It was negatively affected by investments aimed at future growth.
In the Qt business growth investments affected operational profitability, as predicted.
Consolidated earnings before tax for the period totalled EUR -0.4 (-0.7) million, and net profit was EUR -0.3 (-0.5) million.
Earnings per share were EUR -0.02 (-0.02).
The Group’s net financial expenses were EUR 0.2 (0.3) million.
FINANCIAL POSITION AND EXPENDITURE
At the end of the reporting period, the Digia Group’s consolidated balance sheet total stood at EUR 79.6 million (12/2013: EUR 83.3 million), and the equity ratio was 48.7 (12/2013: 49.9) per cent. Net gearing was 42.4 (12/2013: 28.9) per cent. Period-end cash and cash equivalents totalled EUR 2.7 (12/2013: 6.5) million.
Interest-bearing liabilities amounted to EUR 16.9 (12/2013: 16.9) million at the period end. These consisted of EUR 15.0 million in loans from financial institutions, EUR 0.6 in a used overdraft facility and EUR 1.3 million in financial leasing liabilities.
Consolidated net cash flow from operating activities was negative by EUR 1.7 million during the period (Q1/2013: positive by EUR 0.9 million). Cash flow from investments for the review period was negative by EUR 0.3 (0.0) million. Cash flow from finance for the review period was negative by EUR 1.7 (2.6) million. Cash flow from finance was negatively affected by a repayment of capital totalling EUR 1.8 million and by the repayment of loans totalling EUR 0.5 million during the reporting period.
The Group’s investments in fixed assets during the review period totalled EUR 0.3 (0.0) million.
Return on investment (ROI) for the period was -1.6 (-2.7) per cent, and return on equity (ROE) was -3.8 (-9.8) per cent.
The Group carries out quarterly impairment testing on goodwill and intangible assets with an indefinite useful life. The tables below shows the distribution of goodwill and values subject to testing at the end of the reporting period:
| EUR 1,000 | Specified intangible assets | Amortisations during the reporting period | Goodwill | Other items | Total value subject to testing |
| Digia, domestic operations | 1,191 | 122 | 37,987 | 5,746 | 44,925 |
| EUR 1,000 | Specified intangible assets | Amortisations during the reporting period | Goodwill | Other items | Total value subject to testing |
| Digia, Qt business | 6,625 | 218 | 6,562 | 1,891 | 15,079 |
| EUR 1,000 | Specified intangible assets | Amortisations during the reporting period | Goodwill | Other items | Total value subject to testing |
| Group total | 7,816 | 341 | 44,550 | 7,637 | 60,003 |
Present values for domestic operations were calculated for the five-year forecast period based on the following assumptions: Net sales and operating profit for the first quarter of the forecast period according to the confirmed figures for the latest quarter, and for the following three quarters according to budget; after this, annual growth in net sales of 3.0 per cent and in operating profit of 8.0 per cent, and a pre-tax discount rate of 8.9 per cent. Post-forecast-period cash flows were extrapolated using the same assumptions as for the forecast period.
According to a completed sensitivity analysis, the goodwill related to domestic operations requires either net sales to remain at the current level with profitability of 4.6 per cent, or a 3.0 per cent growth in net sales with profitability of 2.6 per cent. The management sees no risk of goodwill impairment associated with domestic operations.
Present values for the Qt business were calculated for the five-year forecast period based on the following assumptions: Net sales and operating profit for the first quarter of the forecast period according to the confirmed figures for the latest quarter, and for the following three quarters according to budget; after this, annual growth in net sales of 6.5 per cent and in operating profit of 5.3 per cent, and a pre-tax discount rate of 8.9 per cent. Post-forecast-period cash flows were extrapolated using the same assumptions as for the forecast period.
According to a completed sensitivity analysis, the goodwill of the Qt business requires either net sales to remain at the current level with profitability of 4.2 per cent, or a 5.0 per cent growth in net sales with profitability of 1.2 per cent. The management sees no risk of goodwill impairment associated with Qt operations.
PERSONNEL, MANAGEMENT AND ADMINISTRATION
At the end of the period, the total number of Group personnel was 938, which was the same as at the end of 2013 (938). The average number of personnel during the review period was 934, which was 5 persons of 0.5 per cent less than the average for the 2013 fiscal year (939).
Employees by function at the end of the period
| Domestic Operations | 75% |
| Qt Operations | 20% |
| Administration and management | 5% |
As of the end of the period, 154 (12/2013: 170) employees were working abroad.
The Digia Plc Annual General Meeting of 11 March 2014 re-elected Päivi Hokkanen, Robert Ingman, Kari Karvinen, Pertti Kyttälä, Seppo Ruotsalainen, Leena Saarinen and Tommi Uhari as members of the Board. At the organisation meeting of the Board, Pertti Kyttälä was elected Chairman of the Board and Robert Ingman, Vice Chairman.
Juha Varelius has been Digia Plc’s President and CEO since 1 January 2008.
Ernst & Young Oy, Authorised Public Accountants, are the Group’s auditors, with Authorised Public Accountant Heikki Ilkka as the principal auditor.
RISKS AND UNCERTAINTIES
The company’s short-term business risks and uncertainties were described in the 2013 Financial Statements. These are unchanged.
Risks and their management are described on the company’s website at http://www.digia.com/en/Company/Investors/Corporate-Governance/Internal-Control-and-Risk-Management/.
FUTURE PROSPECTS
The objective for the company’s domestic operations is to raise profitability to a good level, and to achieve organic growth at least equivalent to general market development. Besides organic growth, the company will actively pursue opportunities to make carefully considered business acquisitions that support its strategy.
Within the Qt business, the emphasis is clearly on creating the necessary conditions for growth. Besides investing in growth, the company will pay attention to improving profitability. The aim is that the income from the Qt business should cover its expenses.
The company expects the Finnish IT market to remain at roughly the previous year’s level in 2014.
Efforts will continue in order to develop the company’s customer understanding and sales and service portfolio, to ensure that it can offer increasingly competitive services and solutions for boosting its customers’ business efficiency. On the other hand, there will also be an emphasis on improving operational efficiency.
The company expects demand to remain generally good in all domestic business areas, and that income from operations and operational profitability will improve as the year progresses. The general market uncertainty may, however, be reflected in the company’s order book and bid volumes.
The Qt order book is healthy, considering the time of year and general market situation, and the company expects demand to continue growing even in the large customer segment. Contract lead times are very long in this market, however – typically 6–18 months – which can cause significant fluctuations between quarters in terms of net sales and, particularly, profitability.
The company estimates that net sales from the Qt business will grow markedly in 2014 compared to 2013. Significant investments will continue in developing the Qt business and Qt technology, while the company will reinforce its sales network, especially in Asia. Investments aimed at securing growth will continue to burden profitability.
Overall, the company predicts its consolidated net sales for 2014 to grow organically at a rate exceeding that of the general market. Further investments in growing the Qt business will continue to hold back the whole company’s profitability.
OTHER EVENTS DURING THE REVIEW PERIOD
Convening on 11 March 2014, Digia Plc’s Annual General Meeting (AGM) adopted the financial statements for 2013, released the Board members and the CEO from liability, determined Board emoluments, resolved to raise the number of Board members to seven (7), and elected the company’s Board of Directors for a new term.
With regard to profit distribution for 2013, the AGM approved the Board’s proposal to make a repayment of capital of EUR 0.10 per share to all shareholders listed on the shareholder list maintained by Euroclear Finland Ltd on the reconciliation date of 14 March 2014. The date for the repayment of capital was set as 21 March 2014.
The AGM granted the following authorisations to the Board
Authorisation for the Board of Directors to decide on buying back own shares and/or accepting them as collateral
The AGM authorised the Board to decide on the buyback and/or acceptance as collateral of a maximum of 2,000,000 shares in the company. This buyback can only be executed by means of the company’s unrestricted equity. The Board shall decide on how these shares are to be bought. Own shares may be bought back in disproportion to the holdings of the shareholders. The authorisation also includes acquisition of shares through public trading organised by NASDAQ OMX Helsinki Oy in accordance with the rules and instructions of NASDAQ OMX Helsinki and Euroclear Finland Ltd, or through offers made to shareholders. Shares may be acquired in order to improve the company’s capital structure, to fund acquisitions or other business transactions, for offering share-based incentive schemes, to sell on, or to be annulled. The shares must be acquired at the market price in public trading. This authorisation supersedes that granted by the AGM of 12 March 2013 and is valid for 18 months – i.e. until 11 September 2015.
Authorisation for the Board of Directors to decide on a share issue and granting of special rights
The AGM authorised the Board to decide on an ordinary or bonus issue of shares and the granting of special rights (as defined in Section 1, Chapter 10 of the Limited Liability Companies Act) in one or more instalments, as follows. The issue may total a maximum of 4,000,000 shares. The authorisation applies both to new shares and to treasury shares held by the company. By virtue of the authorisation, the Board has the right to decide on share issues and the granting of special rights, in deviation from the pre-emptive subscription rights of the shareholders (a directed issue). The authorisation may be used to fund or complete acquisitions or other business transactions, for offering share-based incentive schemes, to develop the company’s capital structure, or for other purposes. The Board was authorised to decide on all terms related to the share issue or special rights, including the subscription price, its payment in cash or (partly or wholly) in capital contributed in kind or its being written off against the subscriber’s receivables, and its recognition in the company's balance sheet. This authorisation supersedes that granted by the AGM of 12 March 2013 and is valid for 18 months – i.e. until 11 September 2015.
SHARE CAPITAL AND SHARES
On 31 March 2014, the number of Digia Plc shares totalled 20,875,645.
At the end of the period, according to Finnish Central Securities Depository Ltd, Digia had 4,886 shareholders.
The 10 biggest shareholders were
| Shareholder | Shares and votes |
| Ingman Group Oy Ab | 20.1% |
| Ilmarinen Mutual Pension Insurance Company | 11.5% |
| Jyrki Hallikainen | 10.2% |
| Kari Karvinen | 6.0% |
| Matti Savolainen | 5.8% |
| Varma Mutual Pension Insurance Company | 4.6% |
| Evli Finnish Small Cap investment fund | 1.5% |
| Nordea Finnish Small Cap investment fund | 1.4% |
| Nordea Bank Finland Plc (nominee-registered) | 1.3% |
| Etola | 1.0% |
Distribution of holdings by number of shares held on 31 March 2014
| Number of shares | Shareholders | Shares and votes |
| 1 – 100 | 23.5% | 0.4% |
| 101 – 1,000 | 58.6% | 6.1% |
| 1,001 – 10,000 | 16.2% | 10.2% |
| 10,001 – 100,000 | 1.3% | 9.8% |
| 100,001 – 1,000,000 | 0.4% | 19.8% |
| 1,000,001 – 4,000,000 | 0.1% | 53.8% |
Shareholding by sector on 31 March 2014
| Shareholders | Shares | |
| Non-financial corporations | 4.3% | 25.1% |
| Financial and insurance corporations | 0.2% | 4.9% |
| General government | 0.1% | 16.2% |
| Not-for-profit institutions serving households | 0.3% | 1.2% |
| Households | 94.6% | 50.1% |
| Rest of the world | 0.5% | 2.6% |
Adjusted for share issues, the weighted average number of shares during the reporting period totalled 20,795,340. The number of outstanding shares came to 20,775,273 in total at the end of the review period.
The company held a total of 100,372 treasury shares at the end of the reporting period. The accounting counter value of these treasury shares is EUR 0.10 per share. The company held about 0.5 per cent of the capital stock as of 31 March 2014.
REPORTED SHARE PERFORMANCE ON THE HELSINKI STOCK EXCHANGE
Digia Plc shares are listed on the NASDAQ OMX Nordic Exchange under IT, IT Consulting & Other Services. The company's short name is DIG1V. The lowest reported share quotation was EUR 3.90 and the highest was EUR 4.59. The share officially closed at EUR 4.06 on the last trading day. The trade-weighted average was EUR 4.19. The Group’s market capitalisation totalled EUR 84,755,119 at the end of the period.
The company received the following flagging notifications during the reporting period
- Ilmarinen Mutual Pension Insurance Company announced on 18 February 2014 that its holding in the company had risen above the 10% flagging threshold to 10.05% of all shares and votes in the company.
- The Ingman Group announced on 25 March 2014 that its holding in the company had risen above the 20% flagging threshold to 20.12% of all shares and votes.
STOCK OPTION SCHEMES
Digia Plc had no outstanding options.
Helsinki, 30 April 2014
Digia Plc
Board of Directors
BRIEFING
Digia will hold a briefing on its Interim Report for analysts on Wednesday 30 April 2014 at 11 am, in the Tapiola cabinet of Hotel Scandic Simonkenttä, Simonkatu 9, 00100 Helsinki, Finland. All are welcome.
FURTHER INFORMATION
Juha Varelius, President and CEO, mobile: +358 400 855 849, email: juha.varelius@digia.com
The Interim Report and the CEO’s presentation will be available on www.digia.com, in the ‘Investors’ section, from 11 am on 30 April 2014.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
ABBREVIATED FINANCIAL STATEMENTS AND ATTACHMENTS
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Changes in Shareholders’ Equity
Notes to the Accounts
The interim report has been prepared in compliance with IFRS and the IAS 34 standard.
This interim report is based on unaudited figures.
CONSOLIDATED INCOME STATEMENT, EUR 1,000
| EUR 1,000 | Q1/2014 | Q1/2013 | Change,% | 2013 | ||||
| NET SALES | 23,957.9 | 23,512.9 | 1.9% | 99,740.5 | ||||
| Other operating income | 400.8 | 291.7 | 37.4% | 1,542.7 | ||||
| Materials and services | -2,378.0 | -2,311.8 | 2.9% | -11,989.4 | ||||
| Depreciation, amortisation and impairment | -702.8 | -731.5 | -3.9% | -9,977.0 | ||||
| Other operating expenses | -21,558.3 | -21,234.0 | 1.5% | -82,138.8 | ||||
| Operating profit | -280.4 | -472.8 | 40.7% | -2,822.0 | ||||
| Financial expenses (net) | -150.8 | -267.5 | -43.6% | -784.0 | ||||
| Earnings before tax | -431.2 | -740.2 | 41.7% | -3,605.9 | ||||
| Income taxes | 100.4 | 268.6 | -62.6% | -461.2 | ||||
| NET PROFIT | -330.8 | -471.7 | 29.9% | -4,067.1 | ||||
| Other comprehensive income: | ||||||||
| Items which may be reclassified subsequently to profit or loss: | ||||||||
| Exchange differences on translation of foreign operations | -44.1 | -116.4 | -62.1% | -36.2 | ||||
| TOTAL COMPREHENSIVE INCOME | -375.0 | -588.1 | 36.2% | -4,103.3 | ||||
| Distribution of net profit: | ||||||||
| Parent-company shareholders | -330.8 | -471.7 | 29.9% | -4,067.1 | ||||
| Minority interest | 0.0 | 0.0 | 0.0 | |||||
| Distribution of total comprehensive income: | ||||||||
| Parent-company shareholders | -375.0 | -588.1 | 36.2% | -4,103.3 | ||||
| Minority interest | 0.0 | 0.0 | 0.0 | |||||
| Earnings per share, EUR | -0.02 | -0.02 | -0.02 | |||||
| Earnings per share (diluted), EUR | -0.02 | -0.02 | -0.02 | |||||
CONSOLIDATED BALANCE SHEET, EUR 1,000
| Assets | 31/3/2014 | 31/12/2013 | Change, % |
| Non-current assets | |||
| Intangible assets | 53,037.0 | 53,327.2 | -0.5% |
| Tangible assets | 1,888.2 | 1,986.0 | -4.9% |
| Financial assets | 627.0 | 627.0 | 0.0% |
| Inventories | 0.0 | 0.6 | -100.0% |
| Long-term receivables | 64.6 | 64.6 | 0.0% |
| Deferred tax assets | 442.2 | 370.9 | 19.2% |
| Total non-current assets | 56,059.0 | 56,376.2 | -0.6% |
| Current assets | |||
| Current receivables | 20,928.0 | 20,447.8 | 2.3% |
| Available-for-sale financial assets | 325.4 | 324.0 | 0.4% |
| Cash and cash equivalents | 2,326.8 | 6,129.8 | -62.0% |
| Total current assets | 23,580.2 | 26,901.7 | -12.3% |
| Total assets | 79,639.3 | 83,277.9 | -4.4% |
| | |||
| Shareholders' equity and liabilities | 31/3/2014 | 31/12/2013 | Change, % |
| Share capital | 2,087.6 | 2,087.6 | 0.0% |
| Rights issue | 0.0 | 0.0 | |
| Issue premium fund | 7,899.5 | 7,899.5 | 0.0% |
| Other reserves | 5,203.8 | 5,203.8 | 0.0% |
| Unrestricted invested shareholders’ equity | 31,370.3 | 33,447.8 | -6.2% |
| Translation difference | 473.5 | 517.6 | -8.5% |
| Retained earnings | -13,181.2 | -9,028.6 | -46.0% |
| Net profit | -330.8 | -4,067.1 | 91.9% |
| Equity attributable to parent-company shareholders | 33,522.5 | 36,060.6 | -7.0% |
| Minority interest | 0.0 | 0.0 | |
| Total shareholders’ equity | 33,522.5 | 36,060.6 | -7.0% |
| Liabilities | |||
| Long-term interest-bearing liabilities | 13,301.1 | 12,741.9 | 4.4% |
| Received long-term advances | 2,187.7 | 2,876.5 | -23.9% |
| Other long-term liabilities | 0.0 | 0.0 | |
| Deferred tax liabilities | 396.3 | 461.0 | -14.0% |
| Total long-term liabilities | 15,885.2 | 16,079.4 | -1.2% |
| Short-term interest-bearing liabilities | 3,571.7 | 4,140.9 | -13.7% |
| Other short-term liabilities | 26,659.8 | 26,996.9 | -1.2% |
| Total short-term liabilities | 30,231.6 | 31,137.8 | -2.9% |
| Total liabilities | 46,116.7 | 47,217.3 | -2.3% |
| Shareholders' equity and liabilities | 79,639.3 | 83,277.9 | -4.4% |
CONSOLIDATED CASH FLOW STATEMENT, EUR 1,000
| 1/1/2014-31/3/2014 | 1/1/2013-31/3/2013 | |
| Cash flow from operations: | ||
| Net profit | -331 | -472 |
| Adjustments to net profit | 166 | 179 |
| Change in working capital | -1,328 | 1,402 |
| Interest paid | -82 | -141 |
| Interest income | 0 | 0 |
| Taxes paid | -168 | -28 |
| Net cash flow from operations | -1,742 | 941 |
| Cash flow from investments: | ||
| Purchases of tangible and intangible assets | -315 | -25 |
| Cash flow from investments | -315 | -25 |
| Cash flow from financing: | ||
| Proceeds from share issue | 0 | 0 |
| Acquisition of own shares | 0 | 0 |
| Repayment of current loans | -500 | -500 |
| Repayments of non-current loans | 0 | 0 |
| Withdrawals of current loans | 0 | 0 |
| Withdrawals of non-current loans | 560 | 0 |
| Dividends paid and other profit distribution | -1,804 | -2,082 |
| Cash flow from financing | -1,744 | -2,582 |
| Change in liquid assets | -3,802 | -1,666 |
| Liquid assets at beginning of period | 6,454 | 8,283 |
| Change in fair value | ||
| Change in liquid assets | -3,802 | -1,666 |
| Liquid assets at end of period | 2,652 | 6,617 |
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY, EUR 1,000
| a | b | c | d | e | f | g | h | |
| Shareholders’ equity, 1 January 2013 | 2,088 | 0 | 7,899 | 33,448 | 5,204 | 554 | -7,129 | 42,063 |
| Net profit | -472 | -472 | ||||||
| Other comprehensive income | 116 | 116 | ||||||
| Dividends | -2,082 | -2,082 | ||||||
| Share-based payments recognised against equity | 274 | 274 | ||||||
| Other items | ||||||||
| Shareholders’ equity, 31 December 2013 | 2,088 | 0 | 7,899 | 33,448 | 5,204 | 670 | -9,409 | 39,900 |
| a | b | c | d | e | f | g | h | |
| Shareholders’ equity, 1 January 2014 | 2,088 | 0 | 7,899 | 33,448 | 5,204 | 518 | -13,096 | 36,061 |
| Net profit | -331 | -331 | ||||||
| Other comprehensive income | -44 | -44 | ||||||
| Repayment of capital | -2,078 | -2,078 | ||||||
| Share-based payments recognised against equity | -86 | -86 | ||||||
| Shareholders’ equity, 31 March 2013 | 2,088 | 0 | 7,899 | 31,370 | 5,204 | 473 | -13,512 | 33,523 |
a = share capital
b = rights issue
c = share premium
d = unrestricted invested shareholders’ equity
e = other reserves
f = currency translation differences
g = retained earnings
h = total shareholders’ equity
NOTES TO THE ACCOUNTS
Accounting principles
The interim report has been drafted in line with IFRS. In other respects, the same accounting principles have been applied as in the 2013 Financial Statements. The accounting principles and formulas for the calculation of key figures and ratios are unchanged and are presented in the 2013 Financial Statements.
Seasonal nature of business
The Group's business is affected by the number of workdays each month, as well as by holiday seasons.
Dividends paid
Dividends paid in the form of capital repayments during the reporting period totalled EUR 2,081,827.30.
Related-party transactions
The Digia Group’s related parties include the members of the Board of Directors, the CEO and Group Management Team. Digia Group had no significant transactions with related parties during the reporting period.
Segment information
Digia’s business operations are divided into two main business segments: Domestic and Qt.
| NET SALES, EUR 1,000 | Q1/2014 | Q1/2013 | Change,% | 2013 |
| Domestic Operations | 19,181 | 19,557 | -1.9% | 79,850 |
| Qt Operations | 4,777 | 3,955 | 20.8% | 19,891 |
| Digia Group | 23,958 | 23,513 | 1.9% | 99,740 |
| OPERATING PROFIT BEFORE EXTRAORDINARY ITEMS, EUR 1,000 | Q1/2014 | Q1/2013 | Change,% | 2013 |
| Domestic Operations | 646 | 447 | 44.5% | 5,395 |
| Qt Operations | -926 | -920 | -0.7% | -846 |
| Digia Group | -280 | -473 | 40.7% | 4,549 |
| OPERATING PROFIT, EUR 1,000 | Q1/2014 | Q1/2013 | Change,% | 2013 |
| Domestic Operations | 646 | 447 | 44.5% | -1,976 |
| Qt Operations | -926 | -920 | -0.7% | -846 |
| Digia Group | -280 | -473 | 40.7% | -2,822 |
| ASSETS, EUR 1,000 | 31/3/2014 | 31/12/2013 |
| Domestic Operations | 51,064 | 53,336 |
| Qt Operations | 17,128 | 16,884 |
| Unallocated | 11,487 | 13,058 |
| Digia Group | 79,679 | 83,278 |
Consolidated income statement by quarter
| EUR 1,000 | Q1/2014 | Q4/2013 | Q3/2013 | Q2/2013 | Q1/2013 |
| Net sales | 23,957.9 | 26,781.8 | 21,435.2 | 28,010.6 | 23,512.9 |
| Other operating income | 400.8 | 504.2 | 305.9 | 441.0 | 291.7 |
| Materials and services | -2,378.0 | -3,033.5 | -1,871.3 | -4,772.7 | -2,311.8 |
| Depreciation, amortisation and impairment | -702.8 | -7,761.9 | -708.5 | -775.0 | -731.5 |
| Other operating expenses | -21,558.3 | -21,768.2 | -18,163.8 | -20,972.8 | -21,234.0 |
| Operating profit | -280.4 | -5,277.6 | 997.4 | 1,931.0 | -472.8 |
| Financial expenses (net) | -150.8 | -247.3 | -264.9 | -4.3 | -267.5 |
| Earnings before tax | -431.2 | -5,524.9 | 732.5 | 1,926.8 | -740.2 |
| Income taxes | 100.4 | 128.6 | -278.2 | -580.2 | 268.6 |
| Net profit | -330.8 | -5,396.3 | 454.3 | 1,346.5 | -471.7 |
| Allocation: | |||||
| Parent-company shareholders | -330.8 | -5,396.3 | 454.3 | 1,346.5 | -471.7 |
| Minority interest | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Earnings per share, EUR | -0.02 | -0.26 | 0.02 | 0.04 | -0.02 |
| Earnings per share (diluted), EUR | -0.02 | -0.26 | 0.02 | 0.04 | -0.02 |
Group key figures and ratios
| EUR 1,000 | Q1/2014 | Q1/2013 |
| Extent of business: | ||
| Net sales | 23,958 | 23,513 |
| - change from previous year | 1.9% | -9.8% |
| Average capital invested | 51,669 | 60,463 |
| Personnel at period end | 938 | 943 |
| Average number of personnel | 934 | 947 |
| Profitability: | ||
| Operating profit before extraordinary items and impairment | -280 | -473 |
| - % of net sales | -1.2% | -2.0% |
| Operating profit | -280 | -473 |
| - % of net sales | -1.2% | -2.0% |
| Earnings before tax | -431 | -740 |
| - % of net sales | -1.8% | -3.1% |
| Net profit | -331 | -472 |
| - % of net sales | -1.4% | -2.0% |
| Return on equity, % | -3.8% | -9.8% |
| Return on investment, % | -1.6% | -2.7% |
| Financing and financial standing: | ||
| Interest-bearing liabilities | 16,873 | 19,114 |
| Short-term investments & cash and bank receivables | 2,652 | 6,617 |
| Net gearing | 42.4% | 31.3% |
| Equity ratio | 48.7% | 50.3% |
| Net cash flow from operations | -1,742 | 941 |
| Earnings per share, undiluted, EUR | -0.02 | -0.02 |
| Earnings per share, diluted, EUR | -0.02 | -0.02 |
| Equity/share, EUR | 1.61 | 1.91 |
| Lowest share trading price, EUR | 3.90 | 2.65 |
| Highest share trading price, EUR | 4.59 | 3.18 |
| Average share price, EUR | 4.19 | 3.00 |
| Market capitalisation | 84,755 | 61,583 |
Formulae for key figures and ratios are presented in the 2013 financial statements. These remained unchanged during the reporting period.