Slide 1: First three months 2020
First three months 2020
Slide 2: The NNIT Presenting Team
The NNIT Presenting Team PER OVE KOGUT CARSTEN KROGSGAARD JENS BINGER THOMSEN Chief Executive Officer Chief Financial Officer Head of Investor Relations 2
Slide 3: Agenda
Agenda 01 COVID-19 & highlights for Q1 2020 02 Microsoft solutions 03 Financial preparedness 04 Financial performance and cost restructuring plan 05 Balance sheet and cash flow 06 Outlook for 2020 3
Slide 4: Forward looking statements
Forward looking statements This presentation contains forward-looking statements. Words such as ‘believe’, ‘expect’, ‘may’, ‘will’, ‘plan’, ‘strategy’, ‘prospect’, ‘foresee’, ‘estimate’, ‘project’, ‘anticipate’, ‘can’, ‘intend’, ‘outlook’, ‘guidance’, ‘target’ and other words and terms of similar me
Slide 5: COVID-19 and NNIT
COVID-19 and NNIT • Stable IT operations for NNIT’s customers, many of which remain critical to the Danish society and global pharma productions • NNIT is supporting customers in adapting to the new workplace situation • Measures towards health and safety for NNIT’s employees have been implemented g
Slide 6: Q1 2020 at a glance
Q1 2020 at a glance Revenue Operating profit* Operating profit margin* DKK 722m DKK 47m 6.5% -3.7% +3.6% +0.5pp +0.3pp F/X -2.5pp F/X -0.1pp F/X Net profit Free cash flow DKK 35m DKK -17m -12% DKK +11m *Before special items 6
Slide 7: Major wins
Major wins Am ount Lengt h Cont ract Segm ent Client (DKK m illion) (years) Novo Novo Nordisk Renewal of t he operat ions maint enance agreement Mid t riple-digit 5 Nordisk Group Renewal and expansion of t he IT infrast ruct ure Finance HK High double-digit 5 Q1 cont ract 2020 Implement at ion of Re
Slide 8: Winning solutions with focus on Microsoft solutions
Winning solutions with focus on Microsoft solutions NNIT wants to become a DK market leader within Microsoft Dynamics D365 services by: 1. Grow NNIT/Scales’ market share on Dynamics 365 for Finance & Operations 2. Grow NNIT’s market share on Dynamics 365 Customer Engagement 3. Grow NNIT’s market sha
Slide 9: Financial preparedness
Financial preparedness Financial gearing DKK million 2016 2017 2018 2019 Q1 2020 Cash balance end year 173.9 -18.6 -135.1 -109.1 -198.2 Lease liabilty -468.2 -379.3 -382.4 -326.0 -306.9 Net debt -294.2 -398.0 -517.5 -435.2 -505.1 EBITDA after special items 437.3 494.1 554.9 473.8 466.3 Net debt/EBIT
Slide 10: Status on implementation of cost restructuring plan
Status on implementation of cost restructuring plan Cost reductions Accumulated cost reductions DKKm Description of main initiatives Progress Q1 2020 achieved in 2019 2020 2021 Progressing according to plan - Increase billable utilization by 4pp Utilization 10 55 75 but COVID-19 may lower - Increase
Slide 11: Financial statement Q1 2020
Financial statement Q1 2020 • Revenue decline 3.7% as expected due DKK million to the loss of the application Q1 2020 Q1 2019 Change 2019 (reported currencies) maintenance agreement and the Revenue 722.1 750.0 -3.7% 3,057.9 Cost of goods sold 618.5 645.5 -4.2% 2,582.6 significant price reduction on
Slide 12: Life Sciences
• Revenue decline in the life sciences Life Sciences segment of 12% due to a 29% decline in revenue from the Novo Nordisk Group driven by the loss of the application maintenance agreement and the DKK million significant price reductions on the Q1 2020 Q1 2019 Change 2019 (reported currencies) operat
Slide 13: Private & Public
Private & Public DKK million • Revenue growth of 5.0% driven by Q1 2020 Q1 2019 Change 2019 (reported currencies) strong growth in the public and Enterprise 206.4 198.2 4.1% 802.3 enterprise segments Public 105.1 89.5 17.5% 392.2 Finance 66.4 72.3 -8.1% 317.6 Revenue 378.0 360.1 5.0% 1,512.1 • Gross
Slide 14: Currency development and hedging
Currency development and hedging 14
Slide 15: Net Financials
Net Financials N et financials Q1 2020 Q1 2019 Change • Net financials for Q1 2020 were DKKm DKK 6m, which was the same level Currency hedge gains 6 7 -1 as Q1 2019 Currency gains (losses) 4 2 2 Tot al currency relat ed it em s 10 9 1 • In Q1 2020 currency hedge gain on Int erest expense from leases
Slide 16: Employee development
Employee development • At the end of Q1 2020, the number of employees decreased by 181 FTEs corresponding to -5.5% compared to the same time last year. Adjusted for the HGP acquisition the number of FTEs declined by 7.5% • The decrease was driven by Denmark (-112 FTEs), China (-122 FTEs) and Czech (
Slide 17: Balance sheet
Balance sheet March 31, March 31, Dec 31, March 31, March 31, Dec 31, Assets 2020 2019 2019 Equity and liabilities 2020 2019 2019 DKK million DKK million Share capital 250 250 250 Intangible assets 528 431 524 Tangible assets 559 595 576 Treasury shares -3 -4 -4 Lease assets 293 364 316 Retained ear
Slide 18: Cash flows
Cash flows Q1 Q1 12M DKK million 2020 2019 2019 Net profit for the period 35 41 183 • The free cash flow for Q1 2020 was negative Reversal of non-cash items 110 82 439 Interest received 0 0 0 with DKK 17m which is DKK 11m above Q1 Interest paid -3 -3 -16 2019 due to higher cash flow from operating I
Slide 19: Backlog development, current year
Backlog development, current year Beginning of quarter • At the beginning of Q2 2020, NNIT’s order entry backlog for 2020 amounted to DKK 2,287 million, which was a decrease of 9.1% compared to last year • The backlog from life sciences clients excluding the Novo Nordisk Group increased by 19% drive
Slide 20: Outlook
Outlook • The financial performance for the first three month were in line with expectations and operating profit margin was slightly above same period last year. • The financial performance was only to a minor extent impacted by COVID-19 in Q1 2020. The effects of COVID-19 was within the project bu
Slide 21: Closing remarks
Closing remarks • NNIT’s financial performance for the first three months of 2020 was in line with expectations • Revenue decline 3.7% as expected due to the loss of the application maintenance agreement and the significant price reduction on the operations maintenance agreement both with the Novo N
Slide 22: Investor contact information
Investor contact information Upcoming events Investor contact August 13, 2020 • Interim report for the first six months of 2020 October 29, 2020 • Interim report for the first nine months of 2020 Jens Binger Head of Investor Relations NNIT A/S, Østmarken 3A, 2860 Søborg, Denmark +45 3079 9222 JBLB@N