Another milestone quarter - expanding into the UK and Ireland through acquisition of ROC

Zalaris' Q3/17 revenues were up 54.1% to NOK 150.6 million compared to the corresponding period last year. The EBIT margin was 4.4%, marked by M&A and integration activity. Prestigious contract signed with Norwegian bank DNB ASA.

Zalaris ASA has this year completed two major transactions, acquiring sumarum AG in the second quarter and ROC Global Solution Consulting Limited in the third. The company has thereby grown from a mostly Nordic player to a pan-European provider of payroll and HR services.

“Q3 was another milestone quarter for Zalaris. We expanded into UK, Europe’s largest market for BPO. At the same time, we also continued organic growth," says Hans-Petter Mellerud, Zalaris’ CEO and founder.

Sales increased 54.1% to NOK 150.6 million in Q3/17 versus Q3/16. The ROC transaction will have full effect in the profit and loss statement from Q4/17. Organic growth in the original Zalaris business was 7.2%, with revenues of NOK 104.7 million in the third quarter.

HR Outsourcing remains the largest segment in terms of revenues, but the cloud services business continues its significant growth, and recorded NOK 25.7 million (NOK 9.4 million) in revenues in Q3/17. Cloud services now represent 16.4% of total revenues.

Now focus on margin expansion
Group operating profit was NOK 6.7 million corresponding to a 4.4% margin (9.2 million or 9.4%) in Q3/17. Profits in the third quarter were marked by post-acquisition integration activities and seasonal variations.

“We will now continue integration efforts while maximizing the value of our combined capability in the marketplace. We have established a structured program aiming at improving margins, targeting the market leaders,” Mellerud says.

Zalaris expects to gain additional synergies and efficient improvements associated with this year’s acquisitions. The company seeks to maintain or increase profitable historic organic growth rates. The two acquisitions will result in a nearly 80% increase in revenue.

New contract awards
In the third quarter, Zalaris signed a five-year agreement with Norway’s largest bank DNB ASA, to provide a full suite of cloud solutions including payroll and talent management for their approximately 9 500 employees.

“We have great solutions supporting the financial services industry with focus on efficiency, strategic work force planning and regulatory compliance and we are happy to work with an ambitious and demanding client,” says Mellerud.

“The DNB agreement is based on our proven integrated solution, which combines Zalaris’ cloud offering and SAP SuccessFactors. This is another example of the breadth and depth of our services, applied to a sector with especially high demands and extensive focus on regulatory issues as well as strategic Human Capital Management,” he adds.

Contact
Hans-Petter Mellerud, CEO and founder
Mobile: +47 928 97 276
E-mail: hans-petter.mellerud@zalaris.com

Nina Stemshaug, CFO
Mobile: +47 982 60 394
E-mail: nina.stemshaug@zalaris.com

Zalaris excels in delivering comprehensive cloud- based HR and payroll services. The company is certified as a SAP Business Process Outsourcing (BPO) Partner and is a leading

SAP Human Capital Management (HCM) and SuccessFactors consulting partner. Founded in 2000, Zalaris today operates in Denmark, Estonia, Finland, India, Latvia, Lithuania,

Norway, Poland, Sweden, Germany, Spain, the UK and Ireland including local-language service centers with extensive expertise in HR- related laws and regulations. Learn more about Zalaris at www.zalaris.com