Slide 1: Q2 2021
Q2 2021
Slide 2: Highlights, Business Review, Financial Review, Outlook, Q&A
1. Highlights of the Quarter 2. Business Review 3. Financial Review Arne Mjøs Bent Hammer 4. Outlook CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER 5. Q & A 2
Slide 3: Highlights Q2 2021
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Slide 4: Q2 in brief
Q2 in brief 24% Digital adoption curves are Positive market development for Leveraging the NOK 15 M Combating financial crime accelerating our services in all investment in with artificial Growth in core across industries locations world class Cloud intelligence in digital business and business Cent
Slide 5: Key figures core digital business
Key figures core digital business 24% 16% 15% Organic revenue Growth in number Operating margin growth of employees Revenues Employees EBIT NOK million 2019 2020 2021 End of period 2019 2020 2021 NOK million 2019 2020 2021 170 600 25 22.1 22.3 151 144 550 539 150 524 20 130 500 15 110 450 10 90 400
Slide 6: Business review
02 Business review 6
Slide 7: Crisis accelerates digitalisation and sustainability
Crisis accelerates digitalisation and sustainability DIGITAL PLATFORMS NEW CONNECTED DEVICES DATA AT THE EDGE Radical changes in the New connected devices shipped Data at the edge growing nearly computing architecture across each year in 2023 is up 50% of as fast as in the cloud the Cloud and the Ed
Slide 8: Towards the fourth industrial revolution
Towards the fourth industrial revolution Social Municipal Command & Factory Control Center Optimisation Economy SUSTAINABLE Environment DIGITAL BUSINESSES Smart Logistics Grid Optimisation Traffic Flow Responsive Store Building Optimisation Optimisation Home Energy Management Comms Network Optimisat
Slide 9: Itera is setting the agenda for Industry 4.0
Itera is setting the agenda for Industry 4.0 Industry 4.0 report DN Studio Live May 4 and 5
Slide 10: Creating shared understanding for value creation
Creating shared understanding for value creation Business Agenda We operate Industry Focus Conversations Business & Product Agenda here! Digital Agenda Business Outcome Conversations Digital Agenda & Potential Disruption Focus Initiative Digital Initiative Digital Initiative Digital Initiative Digit
Slide 11: Delivery Factory at Scale for data-driven businesses
Delivery Factory at Scale for data-driven businesses CUSTOMER BUSINESS & Faster business innovation through DIGITAL STRATEGY Innovation autonomous teams and adoption of cloud services CLOUD CUSTOMER ANALYTICS & MIGRATION DEVOPS DATAOPS ... Business agility and reduced time- WORKLOADS WORKLOADS Speed
Slide 12: Custom teams to solve complex challenges
Custom teams to solve complex challenges TOP 1 IN THE WORLD IN CROSS-BORDER DELIVERY Awarded by the Global Sourcing Association 2018 DIGITAL BUSINESS DISTRIBUTED TEAM MANAGED CLOUD EXPERIENCE SERVICES & DESIGN CORE SECURITY TEAM PRODUCT-ORIENTED TEST PRODUCT multidisciplinary AUTOMATION OWNERS teams
Slide 13: Taking pole position: World Class Cloud Center of Excellence
Taking pole position: World Class Cloud Center of Excellence LANDING ZONE FOR WORKLOADS The 15 MNOK investment in creating a world Cloud services class Cloud Center of Excellence (CCoE) Networking Management was completed successfully in Q2. Identity management Security Governance ▪ Managing everyth
Slide 14: Growing our strategic partnership with Aize
ITERA Growing our strategic partnership with Aize IKT-Norge The drive for industrial digitalisation Itera is top 1 strategic Key focus is Our multi-disciplined partner with Aize with developing software teams of consultants premium digital talent solutions across the are seamless and capabilities fu
Slide 15: Combating financial crime with artificial intelligence
Combating financial crime with artificial intelligence Itera and IBM are teaming up by combining local and global capabilities, industry experience, proven software, and a data driven approach with use of advanced cognitive solutions and artificial intelligence. ▪ Artificial intelligence is at the f
Slide 16: Major framework agreements in the public sector
Major framework agreements in the public sector Three large frame agreements in a strong vendor alliance for the next four years (2+1+1) ▪ Cover almost all Itera services, including system development, architecture, test management, total experience (design), agile coaching, analytics, and data scie
Slide 17: Order intake
Order intake Order intake from selected new and existing customers Book-to-bill ratio*) of 1.0 in Q2 for core digital business and 1.2 for the last 12 months *) The book-to-bill ratio is the ratio of orders received to the amount of revenue for a specific period for Itera units 17
Slide 18: Customer development
Customer development Revenue customers split (in MNOK) ▪ New business 100% 90% 18 17 20 20 16 11 12 18 23 ▪ Existing customers accounted for 85.5% 80% 70% (89.0%) of revenues in Q3 2021 60% 50% ▪ New customers won over the past year 40% 126 111 126 141 133 126 155 139 138 generated revenues of NOK 2
Slide 19: Transformation of own data centre to the cloud
Transformation of own data centre to the cloud ▪ Itera has invested MNOK 15 in a world-class Cloud Centre of 1% Excellence that will provide a scaling 6% 19 % engine for massive data ▪ Revenue from the data centre operations was down 64% to NOK 10 million in Q2 following the 94 % 99 % planned exit o
Slide 20: Skilled and innovative employees in core digital business
Skilled and innovative employees in core digital business Number of employees end of quarter by shore ▪ 539 employees at the end of the 600 500 55 % 53 % quarter 400 51 % ▪ Up by 15 in the quarter 300 49 % 200 47 % ▪ Up by 76 last twelve months 100 45 % 0 43 % Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 ▪ Nearsho
Slide 21: Financial review
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Slide 22: Financial reporting 2021
Financial reporting 2021 ▪ Given the sunsetting of the data centre operations, focus for financial reporting is on the core digital business, including the investment in the Cloud Centre of Excellence. 22
Slide 23: Key financials core digital business
Key financials core digital business 2021 2020 change change ▪ Strong growth of 24% fuelled by % Amounts in NOK million 4-6 4-6 some major new accounts and more Sales revenue 150.8 121.6 29.2 24.1 % Cost of sales 12.3 8.4 3.9 46.8 % subcontractors Gross profit 138.5 113.2 25.3 22.4 % ▪ Personnel exp
Slide 24: Revenue and earnings development
Revenue and earnings development Quarterly Revenue and EBIT margin* ▪ Momentum picking up after front loading of resources through Covid MNOK 180 18% in anticipation of growth 160 16% 140 14% ▪ Margin improvements also aided by 120 12% Covid-related cost avoidance, e.g. 100 10% travel costs. 80 8% 6
Slide 25: Subscription revenue from data centre operations
Subscription revenue from data centre operations MNOK 25 20 15 10 5 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 19 19 19 19 20 20 20 20 21 21 21 21 ▪ Subscription revenue from data centre operations will continue to drop as customers are migrated to cloud or exited 25
Slide 26: Segment reporting
Segment reporting 4-6 2021 4-6 2020 Growth Core Data Core Data digital centre digital centre Core business operations business operations digital Data centre Amounts in NOK million (94%) (6%) Total (81%) (19%) Total business operations Total Sales revenue 150.8 10.3 161.1 121.6 28.3 149.9 24.1 % -63
Slide 27: Statement of cash flow
Statement of cash flow 12 month rolling 2021 2020 2021 2020 2020 cash flow from operations NOK Million 4-6 4-6 1-6 1-6 FY (NOK Million) Cash flow from operations (EBITDA) 24.0 25.8 49.8 55.1 108.9 105 Change in balance sheet items 0.1 13.8 (24.5) (7.9) (9.7) Net cash flow from operating activities 2
Slide 28: Dividend and own shares
Dividend and own shares ▪ An ordinary dividend of NOK 0.25 per share based on 2020 results was paid and board received authorisation to decide on a supplemental dividend later in the year ▪ Share price was NOK 14.0 at the end of Q2 2021, an increase of 21% (27% incl. dividends) from NOK 11.55 at the
Slide 29: Statement of financial position
Statement of financial position Assets Equity and Liabilities ▪ Equity ratio of 12% 250 (19%) per 30 June 2021 200 44 Right-of-use assets 27 ▪ 14% excl. IFRS 16 Leasing 150 56 Non-current assets 60 155 MNOK Current ▪ Cash balance of MNOK 176 liabilities 15 (MNOK 48) 100 87 Receivables and WIP ▪ Tota
Slide 30: Outlook
04 Outlook 30
Slide 31: Outlook
Outlook Attractive market Strong position Core digital business Transforming own Larger projects and driven by through its end-to- will continue to grow data centres to the customers expected sustainability and end services, world- at full speed. cloud with short-term to continue to digitalisation a
Slide 32: Q&A
05 Q&A 32
Slide 33: Make a difference!
Slide 34: Top 20 shareholders
Top 20 shareholders No. Name % Nat. Shareholding 1 ARNE MJØS INVEST AS* 30.01 NOR 24 663 031 2 OP CAPITAL AS 5.54 NOR 4 551 083 3 GIP AS 5.03 NOR 4 137 375 4 EIKESTAD AS 4.37 NOR 3 590 000 5 SEPTIM CONSULTING AS 3.57 NOR 2 930 000 6 BOINVESTERING AS 3.26 NOR 2 676 968 7 DnB NOR Bank ASA 3.16 NOR 2 6