Slide 1: Q3/2021 Investor Presentation
Q3/2021 Investor Presentation Gofore – Pure- play digital transformation consultancy
Slide 2: Disclaimer
Disclaimer This presentation includes forward looking statements which involve risks and uncertainty factors. These statements are not based on historical facts but relate to the company’s future activities and performance. They include statements about future strategies and anticipated benefits of
Slide 3: Presenting today
Presenting today Mikael Nylund, CEO Teppo Talvinko, CFO 3
Slide 4: Gofore is a growing and profitable digital transformation consultancy
Gofore is a growing and profitable digital transformation consultancy. 4
Slide 5: Whether our customers' challenge is big or small, we help them
Whether our customers' challenge is big Identify and boost or small, we help them capabilities implement impactful change. Develop and Define vision and End-to-end offering implement strategy change Maintain, assure and improve 5
Slide 6: We develop new ways of thinking and capabilities at every stage of digital transformation
We develop new ways of thinking and capabilities at every stage of digital transformation journeys Smarter ways of Clarity, focus, working, better Acceleration of Peace of mind, direction customer and services and progress and and purpose employee performance continuity experience • Leadership and •
Slide 7: We deliver digital solutions with positive societal impact
We deliver digital solutions with positive societal impact Selected examples Digitalizing Building a smarter national service education sector architecture Building a best-in-class digital services which Creating a single facilitate information sharing point of contact and dialogue between families,
Slide 8: Growing and profitable
Growing and profitable Net sales growth CAGR 2012 – 2017: 56% CAGR 2017 – 2020: 32% €m 97,6 78,0 64,1 50,6 34,0 18,6 9,2 12,4 3,7 6,0 2012 2013 2014 2015 2016 2017 1) 2018 2) 2019 3) 2020 4) 2021LTM FAS IFRS Adjusted 11.6% 14.8% 14.9% 12.5% 14.1% 16.8% 13.4% 12.0% 13.8% EBITA-% Note: 2012-2018 figur
Slide 9: Our aim is always to be
Our aim is always to be Growing and Constantly renewing Impactful and International Offering exceptional profitable responsible customer and employee experience 9
Slide 10: Business Review July–30 September 2021
1 July–30 September Business Review 2021
Slide 11: Key financial highlights of Q3/2021
Key financial highlights of Q3/2021 NET SALES EBITA, ADJUSTED Employees 21.6 MEUR 2.7 MEUR EBITA-%, ADJUSTED (September) (16.3 MEUR) (1.9 MEUR) 12.5% 814 (716) Growth 32.7% Growth 44.3% (11.5%) Growth 13.7% 11
Slide 12: Net sales and profitability
Net sales and profitability 2018 ⎯ 9/2021 14.0% 13.8% 1-9/2021 growth YoY 13.4% 13.2% 12.0% Total 37% 90 78,0 80 73,3 Finland 41% 70 64,1 60 53,7 International 5% 50,6 50 Public sector 19% 40 30 Private sector 86% 20 10,8 9,6 6,8 7,7 7,5 10 0 2018 2019 2020 1-9 2020 1-9 2021 Net sales, MEUR (reporte
Slide 13: Monthly net sales development 2019 – 9/2021
Monthly net sales development 2019 ⎯ 9/2021 €m CCEA included since March 2021 10,4 9,7 8,8 9,1 8,7 8,5 8,5 8,3 8,5 8,1 7,5 7,1 6,8 6,6 6,1 6,1 6,4 6,26,0 6,1 5,9 5,9 6,0 5,2 5,3 5,5 5,1 5,35,6 4,6 2,7 2,22,4 January February March April May June July August September October November December 2019 2
Slide 14: Quarterly development
Quarterly development Group Q1 20211 Q2 2021 Q3 2021 Q4 2021 Net sales, MEUR 25.2 26.4 21.6 EBITA, MEUR, adjusted 3.5 3.4 2.7 EBITA-%, adjusted 13.9% 13.0.% 12.5% Group Q1 2020 Q2 2020 Q3 20202 Q4 2020 Net sales, MEUR 18.8 18.6 16.3 24.3 EBITA, MEUR, adjusted 3.2 2.5 1.9 3.3 EBITA-%, adjusted 16.8%
Slide 15: Avenues to reach the growth targets
Avenues to reach the growth targets Growth in Finland International growth Disciplined M&A 1. Become #1 in digital 1. Grow with international 1. Keep up M&A growth at transformation business clients served from Finland least at the historical pace for the public sector 2. Expand physical presence 2.
Slide 16: Growth in Finland
Growth in Finland International growth Disciplined M&A Significant customer agreements • Sales to private sector clients increased 86% in 1-9/2021 YoY, (92% in H1/2021 YoY) • New framework agreements with the Finnish Tax Administration for technical project management services • Strong position amon
Slide 17: International growth
Growth in Finland International growth Disciplined M&A • Sales outside Finland affected by Covid-19, but now gradually recovering • New customer agreements and stronger foothold in Europe; e.g. OECD and European Patent Office • Customer investment activity in Germany increasing across the board, bot
Slide 18: Disciplined M&A
Growth in Finland International growth Disciplined M&A • Acquisition of CCEA Ltd. completed in March 2021 – integration of acquired business progressing as planned • Qentinel Finland Ltd. (acquired in September 2020) rebranding to Gofore Verify proceeding • Successful completion of directed share is
Slide 19: Gofore has followed a disciplined M&A strategy over the past years
Growth in Finland International growth Disciplined M&A Gofore has followed a disciplined M&A strategy over the past years 2017-2021 YTD total Leadin 4/2017 Qentinel Finland state-of-the-art Silver Planet 8/2020 added 6 acquired companies design capability, 2/2019 boosted digital quality internationa
Slide 20: Changes in the labour market continue to affect the industry
Changes in the labour market continue to affect the industry TRENDS AND DRIVERS GOFORE STRENGTHS RECENT ACTIVITY RECENT RESULTS Selected highlights Selected highlights • Receding Covid-19 • Well-positioned as an • Constantly renewing • Number of job pandemic ecosystem player recruiting efforts appli
Slide 21: Questions and discussion
Questions and discussion GOFORE
Slide 22: Key investment highlights
Key investment highlights 1 Gofore ideally positioned as a digi-native in the accelerating digital transformation 2 Pure-play next-gen offering with strong customer satisfaction 3 Tech-native culture supports scalability and efficiency 4 Resilient client base and strong revenue visibility 5 Outstand
Slide 23: Gofore ideally positioned as a digi-native in the accelerating digital transformation
1 Gofore ideally positioned as a digi-native in the accelerating digital transformation Traditional IT services New digital services Business support Business development 10% 2-4% Market growth1) Market growth1) Long implementation cycles Agile development IT to support operations Technology as comp
Slide 24: Pure-play next-gen offering for agile digital transformation
2 Pure-play next-gen offering for agile digital transformation 100% legacy-free consulting and development services Lead Create Verify SERVICE AGILE CLOUD, QUALITY ADVISORY DESIGN DEVELOPMENT DATA & VERIFICATION ANALYTICS Digitally native Automated Design and technology development services advisory
Slide 25: Excellent customer experience proof of our ability to add value
Excellent customer experience proof of our ability to add value in 2 digital transformation – driving strong customer growth Gofore is a strategic partner for its customers, accelerating digital change Excellent customer experience Top customers are growing Increasing number of large clients NPS1) T
Slide 26: Long-term relationships with a diverse and growing client base
2 Long-term relationships with a diverse and growing client base Public (74% of sales1)) Private (26% of sales1)) 26%1) 74%1) Sales CAGR Sales CAGR +39%2) +17%2) 2017-20: 2017-20: 1) 2020 figure; 2) 2017 public vs. private sales split percentages based on pro-forma net sales and applied to reported
Slide 27: Tech-native platform underpinning scalability and efficiency
3 Tech-native platform underpinning scalability and efficiency Shared values and communality Daily data collection Low hierarchy and self-organisation Real-time forward-looking analytics Transparency and rich communication Human- Data-driven AI-aided decision making centric management Continuous lea
Slide 28: Strong employer brand further supports talent acquisition and retention
3 Strong employer brand further supports talent acquisition and retention # 2019 2020 1 Supercell 6 Reaktor 2 Futurice 7 Microsoft 3 Google 8 Fazer #1 Finland (Medium) 4 KONE 9 Vincit #2 Europe (Small & Medium) 5 10 Konecranes 724 582 495 374 # of own FTEs at year end 196 132 95 45 62 2012 2013 2014
Slide 29: Resilient client base and strong revenue visibility
4 Resilient client base and strong revenue visibility 74% public share with ~90% of revenue from returning 91% of revenue is time-and-material2): ~3-5 year average contract length1): customers3): Limited execution risk Resilient client base Predictable revenue Net sales (€m) 78,0 64,1 74% 91% 2019 2
Slide 30: Strong margins with further upside
5 Strong margins with further upside Gofore 2019 (% of net sales) • Operational excellence, market knowledge and advisory business create opportunities in pricing Net sales 100% • Room for improvement in billing rate (71% in 2019 including all own employees) • Strong culture, data-driven operations
Slide 31: Strong track record in delivering strong profitable growth
5 Strong track record in delivering strong profitable growth 35% 2017-2020 Sales CAGR 30% 25% Net sales CAGR 20% 2017-2020 32% 15% 10% EBITA-% Cash conversion3) 5% 2020 1) 2020 2) 13.8% 94% 0% -5% 2017-2020 average EBITA margin -10% 0% 5% 10% 15% 20% 25% 30% Note: 1) Adjusted for EVRY merger; 2) 201
Slide 32: Clear roadmap for continued strong growth
6 Clear roadmap for continued strong growth Disciplined M&A Export strong public and industry sector expertise Market share growth and 2017 State-of-the-art private sector growth design capability, New digital services market international business growth Gofore international sales (€m) 2018 Strengt
Slide 33: Long-term target to continue rapid and profitable growth
Long-term target to continue rapid and profitable growth Gofore financial targets and dividend policy Growth Profitability Dividend >20% annual net sales growth, 15% EBITA margin At least 40% of annual of which organic growth net profit accounts for approximately half 33
Slide 34: Guidance 2021 (unchanged)
Guidance 2021 (unchanged) Gofore estimates that, for the full year 2021, net sales will increase compared to 2020, and Adjusted EBITA will increase compared to 2020. Gofore will continue to report and comment on its net sales development on a monthly basis. 34
Slide 35: Appendix
APPENDIX
Slide 36: Key figures
Key figures In thousands of EUR, unless otherwise stated 2019 20201 Net sales 64,066 77,953 Growth of net sales, % 26.7% 21.7% Earnings before interest, taxes, depreciation and amortisation (EBITDA) 9,223 12,329 Earnings before interest, taxes, depreciation and amortisation (EBITDA) 14.4% 15.8% marg
Slide 37: Key figures
Key figures In thousands of EUR, unless otherwise stated 2019 20201 Earnings per share (EPS), undiluted, euros 0.37 0.49 Equity ratio, % 58.1% 47.0% Net gearing, % -31.9% -15.4% Return on equity (ROE), % 18.7% 20.2% Return on investment (ROI), % 17.2% 18.1% Average overall capacity, FTE 517 597 Aver
Slide 38: Pioneering an ethical digital world.
Pioneering an ethical digital world.