Preliminary Accounts Report 1998

Resco AB (publ) Preliminary Accounts Report 1998 Sales rose by 34 per cent @ Sales rose by 34 per cent to SEK 261.3M (195.2) @ Operating earnings increased by 40 per cent to SEK 11.5M (8.2) and earnings after financial items by 44 per cent to 12.4M (8.6). @ Operating margin amounted to 4.4 per cent (4.2) and profit margin to 4.7 per cent (4.4). @ Number of employees amounted to 347 (240) at the period-end. @ The Board of Directors proposes that the dividend be increased by 18 per cent to SEK 1.00 per share (0.85), equivalent to 33 (40) per cent of earnings after tax. @ Resco's Board intends to propose an extensive incentive programme directed at all employees MARKET The Swedish IT market is growing positively and all the signs are that growth will continue over the next few years. Growth is based particularly on structural changes in the companies' operations in which information technology becomes an increasingly integrated part of the business flow. The companies' operating strategies are increasingly based on process-thinking that requires delivery of complete IT solutions which fully support the companies' internal and external business processes. FOURTH QUARTER 1998 Sales and results Sales in the fourth quarter rose by 30 per cent to SEK 78.5M (60.4). Operating earnings amounted to SEK 6.0M (6.6) and operating margin to 7.6 per cent (10.9). The fourth quarter is normally a strong quarter for Resco which is mainly because there are more working days than in the other quarters. However, in the fourth quarter of 1998, earnings and margin were squeezed by costs for training activities of approximately SEK 2M and by low capacity utilisation in one of the Business Areas. Business Areas Business Systems and Operations Development reported continued positive growth. The smallest Business Area, Technology and Communication, also developed favourably with steadily-improved utilisation. Within Business Area Integration and Development, capacity utilisation improved during the fourth quarter compared with the third. Intensified selling work had the effect, among other things, that agreements cold be signed with a couple of customers with regard to component-based system development. However, the capacity utilisation situation for consultants remains unsatisfactory, especially within software. The strengthening that has been made on the sales side is expected to contribute to an improvement during 1999. Resco's training of 22 persons to become SAP/R3 consultants, which started in August 1998, continued according to plan during the quarter and was completed at the turn of the year. The students were gradually phased-in into projects within Business Area Business Systems starting in November 1998. Operations in Business Area Training were changed during autumn 1998 and now consist of Resco Utbildning AB (formerly Poolia Utbildning AB), a company which was acquired on 1 September 1998. An expansion of the operations was initiated following the acquisition to enable it to fit better into Resco's total supply of services. The number of employees in Business Area Training in creased by 60 per cent during the fourth quarter, from 15 to 24. The restructuring work led to a weak earnings development during spring 1998 which, however, was an improvement compared with earlier in the year. During the fourth quarter, Resco concluded agreements with, among others, ABB, Astra, EDS, RPS, Röda Korset, SEB Kort, SPP, SVT, Telia and Terracom. JANUARY-DECEMBER 1998 Sales and results Consolidated sales rose by 34 per cent (36) to SEK 261.3M (195.2). Operating earnings increased to SEK 11.5M (8.2), equivalent to an operating margin of 4.4 per cent (4.2). Earnings after financial items increased to SEK 12.4M (8.6), equivalent to a profit margin of 4.7 per cent (4.4). Earnings per share amounted to SEK 3.07 (2.15). In the result, a provision has been made for allocation of SEK 0.4M (0.0) to Resco's profit-sharing foundation. The sales increase excluding acquisitions amounted to 30 (36) per cent. Earnings after depreciation of goodwill were influenced by acquisitions at SEK -0.2M (0.9). The sales increase, excluding acquisitions, is mainly due to a 26 per cent rise in the number of consultants, a 10 per cent increase in average hourly rate and the fact that the share of sales which emanated from subcontracted consultants rose from 5 per cent to 11 per cent. However, the increase in sales was held back by the fact that the average charge ratio was below the previous year's level. The deterioration is attributable to the increase in the number of consultants during autumn 1998. The average payroll expense per employee was unchanged compared with the previous year. With the aim of improving Resco's future earnings, additional sales staff was recruited during the autumn. In addition, the marketing work was increasingly decentralised to the regions. Resco's long-term target is that the operating margin will amount to at least 10 per cent. Business Areas Sales 1998, Share of Sales SEK M total sales, growth, % % Integration and 101 39 12 Development Business Systems 94 36 38 Operations 40 15 25 Development Technology and 16 6 220 Communication Training 7 3 - Other 3 1 - Total 261 100 34 Business Areas Business Systems, Operations Development and Technology and Communication reported satisfactory growth during the year, albeit Technology and Communication from a low level. In Business Area Integration and Development low capacity utilisation brought about unsatisfactory growth. Expansion of the services relating to implementation of standard systems, which was initiated during the year, had a positive outcome and the work continues. This means, among other things, that Business Areas Integration and Development, and Technology and Communication are becoming increasingly involved with business systems projects, especially with regard to the use of web technology and administration of standard systems. Integration and Development Business Area Integration and Development's sales rose by 12 per cent to SEK 101M (90). The development for the Business Area was significantly less positive than anticipated due to low capacity utilisation. During the autumn, marketing work was intensified while, at the same time, the concept for component-based system development was developed further and strengthened with closer collaboration with partners. The price scenario was favourable and the charge ratio was on a par with the average level for Resco. The operating margin was below the long-term target for Resco. A large project at a fixed price in Region South, which showed a loss, contributed to this. At year-end, the number of employees amounted to 105 (93). In the previous year, ??Assignment Handling?? was reported as a separate Business Area but was included in Business Area Integration and Development during 1998. Business Systems Business Area Business Systems' sales rose by 38 per cent to SEK 94M (68). Demand was very high, especially for services relating to the standard system SAP/R3, but also for other standard systems such as Agresso and Guda. The charge ratio exceeded the average for Resco and the price scenario remained favourable. Earnings were very satisfactory and operating margin higher than the Group's long-term target in spite of the fact that the investment in training 22 new SAP/R3 consultants was charged to earnings by approximately SEK 6M. At year-end, the number of employees amounted to 108 (82). Operations Development Business Area Operations Development's sales increased by 25 per cent to SEK 40M (32). Assignments relating to process development and project management increased during 1998. Closer collaboration between Business Areas Operations Development and Business Systems was initiated. The charge ratio was slightly lower then the average for Resco and the price trend positive. Operating margin was slightly below the Group's long-term target. At year-end, the number of employees amounted to 44 (30). Technology and Communication Business Area Technology and Communication's sales rose by 220 per cent to SEK 16M (5). During the year, a strategic investment was made in the Business Area. In principle, the Business Area offers services relating to system administration and support relating to technical platforms which frequently occur in the marketplace. This is increasingly integrated with projects within the other Business Areas. Competition in the segment is tough and price levels lower then for the other Business Areas. As the operations were built-up during 1998, the charge ratio was low and the operating result negative. At year-end, the number of employees amounted to 29 (10). Training Business Area Training's sales amounted to SEK 7M (0). From 1 September 1998, the Business Area consists of the operations in the acquired company, Resco Utbildning AB (formerly Poolia Utbildning AB), of which the predominant part is profession-oriented IT training and certification programmes. A growth segment is user-training for standard systems, a development which Resco carries out with the aim of being able to supply the whole chain of services from operations development to tailor-made IT training. Operations are carried out in Stockholm and Malmö. The ongoing restructuring work with regard to the Business Area's operations brought about a breakeven result for the past year. At year-end, the number of employees amounted to 24 (0). Regions Sales 1998, Share of Sales SEK M total sales, growth, % % Stockholm 215 82 29 Mälardalen 18 7 38 South 16 6 7 Other 12 5 - Total 261 100 34 Region Stockholm Region Stockholm's sales rose by 29 per cent to SEK 215M (167). The result of Region Stockholm was very satisfactory, especially taking into account the training activity, which was carried out for new SAP/R3 consultants. The charge ratio exceeded the average for the Group. Profitability was in line with Resco's long-term target for operating margin. The main focus of the operations is in the three largest Business Areas, i.e. Business Systems, Operations Development, and Integration and Development. At year-end, the number of employees amounted to 231 (177). Region Mälardalen Region Mälardalen's sales rose by 38 per cent to SEK 18M (13). The result was negative. During the first half of 1998, Mälardalen underwent planned and concentrated expansion. Profitability within the Region was strongly affected by problems of utilising consultant capacity within its core operations after the summer. The main emphasis in the operations lies in Business Area Integration and Development with a focus on group software. The number of employees was 31 (32) at year-end. Region South Region South's sales increased by 7 per cent to SEK 16M (15). The result was negative. During the year, Region South had a high turnover of staff which caused disruptions in the operations. In addition, a loss arose in a major fixed-price project. The main focus of the operations is on Business Areas Business Systems, and Integration and Development. At year-end, the number of employees was 26 (23). The earnings situation for the two Regions is not satisfactory. A number of measures have been implemented to enable these Regions to achieve an operating margin which is on a par with Resco's target. Of these can be mentioned that Region Mälardalen's operations will be concentrated on the Västerås region, whereas the Södertälje office will be integrated into Region Stockholm. At the same time a strengthening has been made of the selling work within group software aimed at rapidly increasing the charge ratio. Work has also been devoted on developing completed application solutions within group software which, with minor adaptations, will be able to satisfy customer requirements and as a result improve Resco's competitiveness. On the part of Region South, it can be mentioned that a new business management has been appointed and that considerable efforts are being made to increase the utilisation of the consultants. Seasonal variations The fourth quarter is normally the most profitable for Resco, mainly because the number of working days is higher than for the other quarters. Costs by quarter are largely constant, everything else being equal. Holidays are normally taken during July and August, which means that the third quarter has the lowest sales and earnings. The number of available working days is affected by how the public holidays fall which varies from year to year. This becomes especially apparent for the first and second quarters. Available working days disregarding holidays 1997 1998 1999 Quarter 1 60 62 62 Quarter 2 61 59 60 Quarter 3 66 66 66 Quarter 4 62 63 64 Total 249 250 252 Consolidated sales by quarter Sales Quarter 1 Quarter 2 Quarter 3 Quarter 4 Full-year 1998 66.0 65.6 51.2 78.5 261.3 1997 45.0 48.6 41.2 60.4 195.2 1996 29.4 33.1 30.2 41.2 133.9 Consolidated operating earnings by quarter Operating Quarter 1 Quarter 2 Quarter 3 Quarter 4 Full-year earnings 1998 7.5 2.0 -4.0 6.0 11.5 1997 0.5 0.8 0.3 6.6 8.2 1996 0.9 1.0 0.5 3.4 5.8 Consoledated operating margin by quarter Operating Quarter 1 Quarter 2 Quarter 3 Quarter 4 Full-year margin, % 1998 11.4 3.0 neg. 7.6 4.4 1997 1.1 1.6 0.7 10.9 4.2 1996 3.1 3.0 1.7 8.3 4.3 Sensitivity analysis In the table below is reported a sensitivity analysis with regard to a number of key factors. Parameter Change Effect on consolidated earnings, SEK M Hourly charge, per +/- 1 2.2 cent Charge ratio, +/- 1 3.8 percentage point Number of working +/- 1 1.0 days per annum Personnel cost, per -/+ 1 1.8 cent Associated companies At 1998 year-end, the 25 consultants who during 1997/98 were trained to become system developers in Project Hackås AB were employed and working in the 50 per cent-owned company, Hackås IT-Partner AB. The consultants are mainly involved in consulting assignments within Resco and the operations of the other stakeholder. For 1998, the effect on Resco of the associated companies was barely positive. Personnel The number of employees at year-end increased by 45 per cent from 240 to 347. Of the increase, 15 were attributable to acquisitions. The average number of employees amounted to 277 (213), an increase of 29 per cent. Turnover of staff amounted to 12 (14) per cent. The relatively high mobility, which applies to the whole sector, is on Resco's part mostly oriented towards Region Stockholm where the labour market for IT consultants is particularly overheated. However, staff turnover was also high in Region South during 1998. Investments Investments in machinery, equipment and premises amounted to SEK 15.6M (11.5), of which SEK 5.5M (3.8) was financed via leasing. Machinery and equipment at a book value of SEK 1.6M (0.2) was also provided via acquisition of subsidiaries. Investments in intangible assets amounted to SEK 7.5M (9.0). Financial position Liquidity The Group's liquid funds amounted to SEK 23.7M (30.1) on 31 December 1998. Interest-bearing liabilities including pension commitments in accordance with the FRG/PRI system amounted to SEK 6.3M (2.8). The Group's liquidity varies seasonally during the year with high values around the turn of years. Cash flow amounted to SEK -6.4M (0.7) during the period. Shareholders' equity The Group's shareholders' equity amounted to SEK 65.5M (59.4) on 31 December 1998. The equity ratio was 53 per cent (63). Return on equity amounted to 13.6 per cent (11.5). Parent Company Net sales in the Parent Company amounted to SEK 171.3M (127.6). Result before appropriations and taxes amounted SEK -1.2M (-1.5). The result includes dividends from subsidiaries of SEK 13.4M and write-down of shares in subsidiaries of SEK 6.9M. On 31 December 1998, the Parent Company's liquidity amounted to SEK 19.9M (25.4). During the year, the Parent Company acquired shares in subsidiaries for SEK 7.3M (9.8) in total. The acquisitions were financed via own funds. The Parent Company's investments in machinery and equipment amounted to SEK 13.8M (8.5), of which SEK 5.5M (2.9) via leasing. YEAR 2000 PROBLEM Resco's Board of Directors has appointed an individual who is responsible for ensuring that the Company's ability to carry out operations will not be jeopardised as a result of the changeover to the year 2000. The work is being monitored by the Board and the Corporate Management on a quarterly basis. A survey has been carried out of which parts of the operations are affected. The survey has covered the IT support in the form of systems developed by Resco, standard systems, purchased applications, hardware, peripheral equipment and technical systems. Exchange of data between systems, which are critical for the operations, has been documented. Implementation of the adopted measures has been in progress since 1 August 1998. It is expected that all objects, which are critical for the operations will have been remedied, and where necessary, replaced and tested by 30 September 1999. Resources for carrying out the activities have been secured. The Board is of the opinion that the implemented measures are sufficient to avoid any damage to the Company and its customers. INCENTIVE PROGRAMME Resco's Board of Directors intends to propose an extensive incentive programme directed at all employees. According to the proposal, the incentive programme comprises convertible subordinated debentures directed at key personnel. The maximum number of shares which could be added through the programme is estimated to amount to just over 5 per cent. The Board's proposal will be discussed at the Annual General Meeting on 27 April 1999. PROSPECTS FOR 1999 Resco's Board of Directors anticipates continued satisfactory growth in sales during 1999, at least on a par with market growth. Resco intends to focus on increased profitability. DIVIDEND The Board of Directors has decided to propose that the Annual General Meeting resolve a dividend of SEK 1.00 per share for 1998 (0.85), equivalent to SEK 2.8M (2.3) in total. Here, it has been assumed that the new share issue in connection with exercising warrants on 28 February 1999 will be subscribed for in full. The proposed dividend is equivalent to 33 per cent (40) of earnings for the year after tax. Annual General Meeting The Annual General Meeting will be held at Trygg-Hansahuset, Fleminggatan 18 in Stockholm on Tuesday 27 April 1999 at 6 pm. NOMINATION OF BOARD MEMBERS Shareholders who wish to submit proposals for Board Members in advance are asked to contact: Kjell Jacobsson, Managing Director and Board Member, telephone +46 8-519 030 00 Stefan Lindell, Head of Information and Deputy Board Member, telephone +46 8- 519 030 00 FUTURE INFORMATION DATES The full Annual Report will be made available from Resco's premises at S:t Eriksgatan 60 in Stockholm from the beginning of April 1999. It will be distributed to the shareholders at the same time. Future information dates 27 April 1999 Annual General Meeting Interim Report January-March 1999 24 August 1999 Interim Report January-June 1999 October 1999 Interim Report January-September 1999 February 2000 Preliminary Accounts Report for 1999 Financial information from Resco is also available on Resco's home page: www.resco.se. Stockholm, 17 February 1999 Resco AB (publ) Board of Directors For further information, please contact: Kjell Jacobsson, Managing Director tel: +46 8-519 030 00 CONSOLIDATED INCOME STATEMENT Amounts in SEK K Group Parent Company 1998 1997 1998 1997 INCOME Net sales 261.312 195.236 171.255 127.648 Change in work in progress on behalf of others - -1.331 - -1.221 Share in results of associated 369 17 - - companies Total income 261,681 193,922 171,255 126,427 EXPENSES External costs -67,602 -48,484 -60,889 -31,544 Personnel costs -177,146 -133,848 -115,484 -94,264 Depreciation according to plan -5,442 -3,382 -3,218 -2,000 Items affecting comparability - - - -535 Total expenses -250,190 -185,714 -179,591 -128,343 OPERATING EARNINGS 11,491 8,208 -8,336 -1,916 Financial items 895 419 7,127 377 RESULT AFTER FINANCIAL ITEMS 12,386 8,627 -1,209 -1,539 Appropriations - - 16,729 362 Taxes -4,019 -2,995 -2,786 -34 NET EARNINGS FOR THE YEAR 8,367 5,632 12,734 -1,211 CASH FLOW ANALYSES Amounts in SEK K Group Parent 1998 1997 Company 1998 1997 CASH FLOW FROM THE YEAR'S OPERATIONS Operating earnings 11,491 8,208 -8,336 -1,916 Adjustment for: Associated companies -369 -17 - - Merger deficit/surplus - - - 535 Provision PRI 3,483 2,772 1,970 1,919 Other provisions 300 - - - Capital loss/gain, - 32 - 32 machinery and equipment Depreciation 5,442 3,382 3,218 2,000 Financial items 895 419 7,127 377 Write-down of shares in - - 6,861 - subsidiaries Income tax -2,786 -1,186 -2,786 -1,519 Cash flow from current operations before changes in working capital 18,456 13,610 8,054 1,428 CHANGE IN WORKING CAPITAL Increase in current -21,452 -11,935 -22,176 -250 receivables Increase in current 18,565 8,477 6,756 3,179 liabilities Change in work in progress - 1,259 - 1,149 Total change in working -2,887 -2,199 -15,420 4,078 capital TOTAL CASH FLOW FROM CURRENT OPERATIONS 15,569 11,411 -7,366 5,506 INVESTMENT OPERATIONS Acquisition of intangible -7,532 -7,038 - - assets Acquisition of tangible -11,661 -7,851 -8,258 -5,878 assets Acquisition of financial -500 -1,250 -500 -1,250 assets Acquisition of shares in - - -7,339 -7,760 subsidiaries Take-over of taxed and untaxed capital in - - - 1,000 connection with merger Sale of machinery and - 234 - 234 equipment Cash flow from investment operations -19,693 -15,905 -16,097 -13,654 FINANCING OPERATIONS New share issue - 7,600 - 7,600 Subordinated debentures - -500 - -500 Group contributions - - 20,294 - Dividend paid -2,315 -1,950 -2,315 -1,950 Cash flow from investment operations -2,315 5,150 17,979 5,150 INCREASE/DECREASE IN CASH AND BANK -6,439 656 -5,484 -2,998 Cash and bank on 1 January 30,144 29,488 25,383 28,381 Cash and bank on 31 23,705 30,144 19,899 25,383 December BALANCE SHEETS Amounts in SEK K Group Parent 1998 1997 Company 1998 1997 ASSETS FIXED ASSETS Intangible fixed assets Prepaid tax 1,280 178 - - Goodwill 14,116 9,112 - - 15,396 9,290 - - Tangible fixed assets Premises 1,896 1,856 1,896 1,856 Machinery and equipment 16,129 8,702 11,502 6,502 18,025 10,558 13,398 8,358 Financial fixed assets Participations in Group - - 17,238 16,760 companies Participations in 636 267 250 250 associated companies Other long-term 1,150 1,150 1,150 1,150 securities holdings Long-term receivables 500 - 500 - 2,286 1,417 19,138 18,160 Total fixed assets 35,707 21,265 32,536 26,518 CURRENT ASSETS Current receivables Trade debtors 52,033 36,513 31,375 22,362 Receivables from Group - - 13,265 - companies Prepaid tax 290 1,421 - 1,774 Other receivables 1,262 440 1,129 389 Prepaid expenses and 11,207 4,966 5,571 4,639 accrued income 64,792 43,340 51,340 29,164 Cash and bank 23,705 30,144 19,899 25,383 Total current assets 88,497 73,484 71,239 54,547 TOTAL ASSETS 124,204 94,749 103,775 81,065 BALANCE SHEETS Amounts in SEK K Group Parent 1998 1997 Company 1998 1997 LIABILITIES AND SHAREHOLDERS' EQUITY SHAREHOLDERS' EQUITY Restricted equity Share capital 6,809 6,809 6,809 6,809 Restricted reserves 42,775 39,166 - - Share premium reserve - - 9,291 9,291 Statutory reserve - - 22,900 22,900 Total restricted equity 49,584 45,975 39,000 39,000 Non-restricted equity Non-restricted reserves 7,543 7,835 4,360 7,886 Net earnings for the 8,367 5,632 12,734 -1,211 year Total non-restricted 15,910 13,467 17,094 6,675 equity Total shareholders' 65,494 59,442 56,094 45,675 equity UNTAXED RESERVES - - 12,253 8,688 LIABILITIES Provisions PRI pension 6,255 2,772 3,889 1,919 Deferred tax liability 3,714 2,659 - - Other provisions 300 - - - Total provisions 10,269 5,431 3,889 1,919 Current liabilities Trade creditors 15,929 7,311 12,043 5,802 Liabilities to Group - - - 3,973 companies Liabilities to - 633 - 633 associated companies Tax liabilities - - 181 - Other liabilities 12,803 9,670 6,656 5,906 Accrued expenses and 19,709 12,262 12,659 8,469 prepaid income Total current 48,441 29,876 31,539 24,783 liabilities TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 124,204 94,749 103,775 81,065 MEMORANDUM ITEMS Pledged assets None None None None Contingent liabilities Guarantee 29 39 29 39 Tax dispute 1,050 1,250 1,050 1,250 FPG 125 55 78 38 FIVE-YEAR SUMMARY Amounts in SEK K 1998 1997 1996 1995 1994 INCOME STATEMENTS NET sales 261,312 195,236 133,895 106,586 73,322 Other 369 -1,314 1,331 - - External costs -67,602 -48,484 -29,388 -30,608 -18,153 Personnel costs -177,146 -133,848 -96,828 -65,594 -49,639 Depreciation -5,442 -3,382 -1,042 -916 -768 according to plan Items affecting - - -2,216 - - comparability Operating earnings 11,491 8,208 5,752 9,468 4,762 Financial items 895 419 1,430 1,120 238 Earnings after 12,386 8,627 7,182 10,588 5,000 financial items Taxes -4,019 -2,995 -2,240 -3,131 -1,503 Net earnings for the 8,367 5,632 4,942 7,457 3,497 year BALANCE SHEETS Intangible assets 15,396 9,290 3,840 216 251 Other fixed assets 20,311 11,975 5,465 2,078 1,900 Other current assets 64,792 43,340 31,907 23,314 19,933 Cash and bank 23,705 30,144 29,488 12,853 7,696 Total assets 124,204 94,749 70,700 38,461 29,779 Restricted equity 49,584 45,975 36,086 10,990 7,187 Non-restricted 15,910 13,467 10,074 9,078 6,424 equity Total shareholders' 65,494 59,442 46,160 20,068 13,611 equity Provisions 10,269 5,431 2,641 1,914 1,227 Current liabilities 48,441 29,876 21,899 16,479 14,941 Total shareholders' 124,204 94,749 70,700 38,461 29,779 equity, provisions and liabilities KEY FIGURES Operating margin, % 4,4 4,2 4,3 8,9 6,5 Profit margin, % 4,7 4,4 5,4 9,9 6,8 Net margin, % 3,2 2,9 3,7 7,0 4,8 Return on 13,4 11,5 19,4 40,9 36,7 shareholders' equity, % Return on total 11,6 10,6 14,9 28,9 23,2 capital, % Return on working capital, % 28,1 33,6 48,2 144,2 179,2 Equity ratio, % 53 63 65 52 46 Share of risk- 56 66 69 57 50 bearing capital, % Acid-test ratio, % 173 228 257 193 173 Employees at year- 347 240 200 128 105 end Average number of 277 213 165 114 90 full-time employees Sales per employee, 943 917 811 935 814 SEK K Payroll excluding payroll overheads in 41 43 44 37 41 percent of sales Value added per 638 629 579 608 563 employee Value added ratio, % 68 70 71 65 69 Net investments, SEK 19,7 16,6 8,1 1,1 0,7 M 1998 1997 1996 1995 1994 DATA PER SHARE, SEK Earnings per share 3,07 2,15 2,32 3,73 2,20 after full tax Cash flow from current operations 5,72 4,35 1,29 4,49 3,14 per share Equity per share ** 24,05 21,82 19,91 10,00 8,50 Dividend (1998 1,00 0,85 0,75 1,12 0,62 proposal) Number of shares at 2,724 2,724 2,600 2,000 1,600 year-end, 000 Average number of 2,724 2,624 2,125 2,000 1,600 shares, 000 * adjusted for issue ** equivalent to net asset value per share Resco's business concept is to make the customers' operations more efficient by combining operations development and information technology. Resco's sales in 1998 amounted to SEK 261M and the number of staff at 1998 year-end was 347. ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/02/22/19990222BIT00360/bit0001.doc http://www.bit.se/bitonline/1999/02/22/19990222BIT00360/bit0002.pdf