Slide 1: Interim report | Third quarter 2016
Interim report | Third quarter 2016 Oslo, 26 October 2016
Slide 2: Presenters and agenda
Presenters and agenda Agenda • Recent highlights Hans-Petter Mellerud • Financial performance in Founder and CEO third quarter of 2016 • Cloud HR roadmap • Outlook Nina Stemshaug CFO © 2016 2014 Zalaris Page: 2
Slide 3: Revenues continued to grow, mainly in the Cloud segment
Revenues continued to grow, mainly in the Cloud segment. Converting leads to requests for proposals (RFPs) Financial indicators Strategic milestones • Q3/16 revenues was 97.7 million, up 5.4 % • Revenues continued to grow, despite no year-on-year. significant new contracts • EBIT reached 9.2 million
Slide 4: Number of customer employees served still above 200'
Operational key performance indicators Number of customer employees served still above 200’ Employees served (1000’) 210 • No new customers online in the quarter. 200 200 200 196 Number of employees served by Zalaris 191 HR Outsourcing in Q3/16 was the same 190 190 as in the previous quarter. • Volu
Slide 5: Efficiency continues to improve
Operational key performance indicators Efficiency continues to improve HR Outsourcing • Productivity continued to improve. Employees and productivity Average number of employees served per FTE (full time equivalent) within HR 340 Outsourcing was 662 in Q3/16. 820 320 • Improved efficiency is a resul
Slide 6: Q3/16 revenues increased 5.4% year-on-year. Cloud growing in importance
Q3/16 revenues increased 5.4 % year-on-year. Cloud growing in importance • Group revenues reached 97.7 million in Operating revenues Q3/16, up from 92.6 million same quarter last year. 110 • Cloud Services revenues in Q3/16 was 9.4 million, an increase of 51 % since Q3 100 98,5 97,7 last year. 94,6
Slide 7: Profit rebounded after seasonal variations and reduced personnel costs
Profit rebounded after seasonal variations and reduced personnel costs • Operating profit rebounded after seasonal Group operating profit1 variations in Q2. Significantly improvement from Q3/15. 6.8 % Profit margin 9.4 % • Personnel cost reduced 0.9 million from 10 9,3 9,2 Q2/16 as downsizing projec
Slide 8: HR Outsourcing segment: Growth in profit and margin
HR Outsourcing segment: Growth in profit and margin compared with both previous quarter and last year Operating revenues Operating profit and margin • Revenues in Q3/16 was 85.8 million, up • Profit reached 9.2 million in Q3/16, 3 % y-o-y as new customers have come highest profit and margin since Q3
Slide 9: Positive cash flow from operations, strong financial position
Positive cash flow from operations, strong financial position Cash and cash flows Q3/16 • Cash flow from operations was negative 0.9 million as accounts 45 receivables increased. 0,9 3,5 40 0,8 • Investments mainly related to 35 implementation of new functionality, 30 features and systems for cloud
Slide 10: Investments in HR technology companies grew 60% during 2015
Investments in HR technology companies grew 60 % during 2015 Investor investments in HR Technology 2011-2016 «According to CB Insights, Investors plunged $2.4 billion into HR tech vendors during 2015, a 60 percent increase from the prior. This amazing investment growth—much of which went into new in
Slide 11: The HR technology market is undergoing one of the most disruptive years
“The HR technology market is undergoing one of the most disruptive years it has seen this decade” – Joe Bersin Joe Bersin 2016: Joe Bersin 2017: 1. Consumerized HR Technology: Think 1. The Accelerating Revolution of Performance Employee Tools, Not HR Tools Management 2. The “Appification” of Everyth
Slide 12: Many still challenge if public cloud solutions are ready for payroll
Many still challenge if public cloud solutions are ready to handle complexity and mission criticality of payroll and transactional HR Local tariff agreements and complex worktime practices complicated to fit into standardized cloud practices What happens if your payroll solution is unavailable a
Slide 13: Zalaris support customers realizing their Cloud HR Roadmap
Zalaris support customers realizing their Cloud HR Roadmap Current situation: Issues to be addressed: • On premise solution as SAP HCM • How to realize business case if need for payroll, time, travel and talent management to maintain own infrastructure for • Employee requests handled by payroll, tim
Slide 14: Zalaris core BPO payroll services enable customers to take advantage of Cloud services
Zalaris core BPO payroll services enable customers to take advantage of Cloud services and provides mission critical disruption insurance Onboarding Phase Employment Phase Alumni Phase HR Help desk solution Employee Master Data Employee Reporting and Analytics Recruiting & Learning Letters of Refere
Slide 15: Concluding remarks: Revenues and profits rebound as requests for proposals take off
Concluding remarks: Revenues and profits rebound as requests for proposals take off • Revenues continued to grow despite no significant new contracts in the quarter. Cloud segment main source for growth • Converting leads to request for proposals, as companies cut costs and strengthen HR/payroll fun
Slide 16: 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 17: Questions?
Questions?
Slide 18: Thank you!
Thank you! Hans-Petter Mellerud CEO & Founder Zalaris HR Services AS hans-petter.mellerud@zalaris.com PO Box 1053 Nina Stemshaug NO-0218 Oslo CFO Tel: +47 4000 3300 nina.stemshaug@zalaris.com www.zalaris.com