ZALARIS: 2016 Second Quarter Results and First Half Year. Record-strong pipeline, offshoring on track
Zalaris’ Q2/16 revenues were up 3.1% to NOK 95 million, with EBIT margin at 7.5%. The company served more than 200,000 client employees at the end of June - a key milestone. Stronger pipeline of new opportunities.
Zalaris, a leading provider of payroll and HR services, delivered solid results in Q2/16 with continued growth and stable margins. Sales increased 3.1% to NOK 95.3 million in Q2/16 from Q2/15, with a corresponding EBIT of NOK 7.1 million (7.5%) for the period.
“We continued to strengthen our leading position in the market throughout the first half of 2016. Our results prove our ability to deliver continued growth despite a somewhat slower market”, says Hans-Petter Mellerud, Zalaris’ CEO and founder.
In Q2, Zalaris finalized agreements for the provision of payroll cloud services with Scandinavian Airlines in Sweden and a Leading Electronics Utility Company, with service deliveries scheduled to start in Q1/17. In total, this will bring approximately 6,000 new employees onto our platform already utilized by some of the largest companies in the Nordic region, Baltics and Poland. The total number of employees covered by Zalaris solutions was 5.6% higher in Q2/16 vs Q2/15.
“Zalaris’ operations now serve more than 200,000 employees today, a key milestone for the company. Interest remains high in Zalaris services, contributing to an increased pipeline in terms of both the number of potential deals and annual contract value”, says Hans-Petter Mellerud.
Revenues are shifting towards cloud services in the quarter, which now represent 6.3% of group revenues (0.8%). The trend is continuing. While its relative share is decreasing, HR Outsourcing remains the largest business segment, accounting for 91% of group revenues.
“Clients that opt for cloud services solutions for their HR and payroll needs, are boosting income to Zalaris’ Cloud services segment. This is supporting our further growth”, says Mellerud.
Zalaris’ Chennai-based service center provides many advantages and represented in Q2/16 almost 17% of the company’s total service and support hours. The strong efforts on the Chennai office support increasing margins.
“The shift towards increased production in Chennai continues with full force, and full margin effect is expected in Q2/17. The realized savings will be reinvested into improved services and growth-related activities”, Mellerud comments.
Contact
Hans-Petter Mellerud, CEO and founderMobile: +47 928 97 276E-mail: hans-petter.mellerud@zalaris.com
Nina Stemshaug, CFOMobile: +47 982 60 394 E-mail: nina.stemshaug@zalaris.com
Zalaris 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 and Sweden, including local-language service centers with extensive expertise in HR-related laws and regulations.