Tieto Corporation · OMXHEX:TIETO
Tieto — Q3 2010 Earnings Presentation
9 slides from Tieto's earnings presentation, Oct 27, 2010
Slide 1: Tieto Q3'10: Solid performance in Q3, one-off costs strain Q4 profitability
Ti t Q3’10 Tieto Solid performance in Q3 – one-off costs strain profitability in Q4 27 October 2010 Helsinki, Finland Hannu Syrjälä – President and CEO Seppo Haapalainen – CFO Reeta Kaukiainen – VP, Comms&IR © 2010 Tieto Corporation Markets and customers: Back-end loaded year and slow decision makin
Slide 2: Top 10 customers account for 39% of net sales; Q3 highlights
Top 10 customers account for 39% of net sales Net sales by customer segment 45 % 34 % 21 % Telecom & media Financial services * Automotive, energy, forest, healthcare Industry sectors* and welfare, manufacturing, public, retail and logistics 3 © 2010 Tieto Corporation Q3 highlights Solid performance
Slide 3: 9 month highlights; Quarterly development
9 month highlights Investing in the future • Strategy execution • 35% offshoring target achieved ahead of schedule • Focused investments in the Russian operations • Steady profitability improvement in Sweden and healthy margins in Finland • Divestments in the USA (pulp and paper) and in France (tele
Slide 4: Third quarter in brief; Income statement
Third quarter in brief Q3/2010 Q3/2009 9M/2010 9M/2009 Net sales, sales EUR million 387 1 387.1 382 9 382.9 1 241 241.5 5 1 265 265.7 7 Operating profit, EUR million 27.7 26.3 66.0 41.6 EBIT, % 7.2 6.9 5.3 3.3 Profit after taxes, EUR million 24.4 18.4 48.1 29.4 EPS, EUR 0.34 0.25 0.67 0.40 Net cash
Slide 5: 35% offshoring target reached ahead of plans
35% offshoring target reached ahead of plans 7000 40 % 6000 35 % Target for 2010 30 % 5000 25 % 4000 20 % 3000 15 % 2000 10 % Snapshot of India 1000 5% • Started St t d ini 2005 by b an acquisition i iti • 1 300 employees 0 0% • Sites in Pune and Bangalore 2004 2005 2006 2007 2008 2009 9M/2010 • Pro
Slide 6: Finland; Sweden
Finland Demand picking up in most sectors • Sales were flat • Operating profit EUR 24 (28.1) million i.e. 12 0% (14 12.0% (14.1) 1) • Lower prices and higher personnel costs impacted profitability 14.6% • The drop in the finance sector offset the 11.4% 12.0% growth in other sectors 14.1% 10.2% • Emp
Slide 7: International; Telecom & Media
International Sales growth lead by Asia and Eastern Europe • Sales down by 1%, but the underlying sales* grew by 3% • Operating profit EUR 4.6 4 6 (0.9) (0 9) million ii.e. e 3.6% (0.7) • Continued business development in Russia 3.6% • Excellent sales development in China 1.7% • Employees 9 044 (7 3
Slide 8: Financial Services; Industry sectors
Financial Services Stable market with tough competition • Net sales fell by 5% Net sales, MEUR • Excl. the positive currency effect, sales declined by around 9% 100 • Decline mainly attributable to the Finnish 75 pension insurance segment 50 • In Sweden, net sales in local currency 25 remained flat
Slide 9: Outlook 2010: Profit guidance lowered due to one-off costs
Outlook 2010 Profit guidance lowered due to one-off costs • The IT markets have bottomed out • Sales guidance unchanged: Tieto expects its net sales to develop in li with line ith th the IT services i market k t relevant l t to t the th company • New profit guidance: According to the company’s lates