Zalaris Asa · OSL:ZAL
Zalaris Asa — Q1 2019 Earnings Presentation
26 slides from Zalaris Asa's earnings presentation, May 8, 2019
Slide 1: Interim report | Q1 2019
– Value people Interim report | Q1 2019 8 May 2019
Slide 2: Presenters and agenda
Presenters and agenda 1. Highlights 2. Financial performance in Q1/19 3. Market update and conclusion Hans-Petter Mellerud Nina Stemshaug Founder and CEO CFO © zalaris 2019 Page 2
Slide 3: Growth in revenues and go live with major clients
Highlights | Strategy and operations Growth in revenues and go live with major clients • Revenues of NOK 192.4 million and EBIT of NOK 6.5 million or 3.4%. • Launched several new customers with an annual contract value of approximately NOK 20 million during the quarter. • Streamlining the organizati
Slide 4: Growth in revenues compared to Q1/18
Highlights | Financial Growth in revenues compared to Q1/18 • Revenues of 192.4 million, a y-o-y increase of 3.3 percent – driven by growth Key figures in the Managed Services segment Q1 2019 • Adjusted EBIT of NOK 6.5 million, down NOK million Q1/19 Q1/18 from NOK11.4 million in Q1/18 Revenues 192.
Slide 5: Revenue growth in all geographies Q/Q
Geographical revenue split Revenue growth in all geographies Q/Q Distribution of revenues Northern Europe by geography (in per cent) • Slight growth from NOK 107.4 million in Q1/18 to NOK 107.8 million in Q1/19. • Price reductions in renewed contracts was 4 2 3 4 5 compensated with an increased scop
Slide 6: Key financials – First quarter 2019
Key financials First quarter 2019
Slide 7: Quarterly revenues
Group revenues Quarterly revenues Group revenues (in NOK million) 186 189 [VALU 194 192 • Revenues for Q1/19 amounted to 192.4 E] million, higher than Q1/18. • Year-on-year growth in the quarter was 3.3 % driven by growth in both segments. • Growth in revenues within all geographies. • Strong demand
Slide 8: Group EBIT NOK 6.5 million
Group EBIT Group EBIT NOK 6.5 million Group EBIT (in NOK million) [VALU § Group EBIT for the quarter was NOK 6.5 million, E] compared to NOK 11.4 million in Q1/18. 10.0 § Q1/19 was marked by increased expenses for external services compared to Q1/18 – a result of temporary 6.5 reduction of interna
Slide 9: Increase in assets compared to both Q1/18 and Q4/18
Financial position Increase in assets compared to both Q1/18 and Q4/18 Cash and cash flows Q1/19 Changes in balance sheet and cash flows (in NOK million) 120 § Increase in total assets by NOK 119.4 million since Q1/18 and NOK 30.8 since Q4/18, to NOK 756.4 million at 31 March 2019. 100 § Equity de
Slide 10: Key financials | Business segment
Key financials | Business segment First quarter 2019 Segment reporting includes only external revenues and external profit
Slide 11: Changes in segment reporting
Revenues by segment Changes in segment reporting • Change in reporting of business segments from Q1/19 to improve visibility and reflect market trends, overlapping sales • HR Outsourcing and Cloud Services merged into one segment, Managed Services • Organized as group wide business to speed growth a
Slide 12: Growth in both segments
Revenues by segment Growth in both segments Managed Services Professional Services (NOK million) (NOK million) § Represents 75% of Group revenue § Increased by NOK 1.4 million to NOK since start of 2018 48.7 million in Q1/19 compared to § Revenues in Q1/19 amounted to NOK Q1/18 143.7 million (NOK
Slide 13: Managed Services with positive margin trend compared to the last two quarters
Adjusted EBIT by segment Managed Services with positive margin trend compared to the last two quarters Managed Services Professional Services (NOK million) (NOK million) § EBIT of NOK 15.3 million in Q1/19 § The EBIT of NOK 7.0 million was at compared to NOK 18.8 million in the same level as Q1/18
Slide 14: Market update and concluding remarks
Market update and concluding remarks
Slide 15: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead Centrally managed support func3ons: • F&A • HR • IT and Infrastructure • Marke:ng and Communica:ons Group organiza3on for Managed Services Professional Services to define b
Slide 16: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead © zalaris 2019 Page 16
Slide 17: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead © zalaris 2019 Page 17
Slide 18: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead © zalaris 2019 Page 18
Slide 19: Developing Professional Services capabilities for HR service providers
Market update Developing Professional Services capabilities for the HR service providers are vital for successful implementations of better solutions • The demand after advisory services such as Zalaris’ have grown 20 % in five years • Solutions and services for all kind of employees in all kind of
Slide 20: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead © zalaris 2019 Page 20
Slide 21: Streamlined organization with goal of focusing on customer needs
Streamlined organization with goal of focusing on customer needs, addressing multi country growth ambition and reducing overhead Centrally managed support func3ons: • F&A • HR • IT and Infrastructure • Marke:ng and Communica:ons Group organiza3on for Managed Services Professional Services to define b
Slide 22: Road to higher margins
Road to higher margins Zalaris remains a growth company in mindset and structure. However, our key priority for 2019 is to return to margin-levels from before the 2017- acquisitions (delivering consistent 10% adjusted EBIT) ultimo FY 2019 • Target of reducing monthly costs with approx. NOK 4,7 mill.
Slide 23: A plan to reclaim margins
Concluding remarks A plan to reclaim margins • The key priority for Zalaris in 2019 is returning to margin-levels from before the 2017-acquisitions. • Target of consistent 10% adjusted EBIT ultimo FY2019 • Several initiatives to increase efficiency and reduce costs, including centralizing of support
Slide 24: Important notice
Important notice This Presentation includes certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward-looking statements relate to future circumstances and results and other statements that are not
Slide 25: We open for questions
Ay ZALARIS We open for questions
Slide 26: Thank you!
Thank you! Zalaris ASA PO Box 1053 NO-0218 Oslo Hans-Petter Nina Stemshaug Mellerud CEO & Founder CFO +47 4000 3300 hans-petter.mellerud@zalaris.com nina.stemshaug@zalaris.com www.zalaris.com