Slide 1: Q4 2022 Strong growth and profitability
Q4 2022 2021 Strong growth and profitability Kimmo Alkio, President and CEO Tomi Hyryläinen, CFO
Slide 2: Q4: Strong growth and profitability
Q4: Strong growth and profitability Growth of Adj. EBITA margin of Strategic reviews of Increased dividend of 9% 15.4% Tietoevry Banking and Tietoevry Transform & €1.45 driven by Tietoevry driven by strong growth Connect progressing (1.40) per share Create, Tietoevry and performance according to the
Slide 3: 2022: New strategy driving value and competitiveness
2022: New strategy driving value and competitiveness Solid strategy Growth agenda Active drive for Record-high Continued high execution with materializing – efficiency employee focus on the six specialized five consecutive off-setting era of engagement and safety and well- businesses for quarters of
Slide 4: Solid financial performance in 2022
Solid financial performance in 2022 Revenue Organic growth1 Adj. EBITA2 €2 928m 6% €379m, 13.0% (€2 823m) (0%) (€368m, 13.0%) Growth acceleration and strong financial position – a solid Order backlog foundation into 2023 Operating cash flow Net debt / EBITDA €277m €3 327m 1.5x (€3 513m) (€368m) (1.1
Slide 5: Winning in the market through specialization
Winning in the market through specialization Digital engineering expanding global customer base Software and platforms (Banking, Care, Industry) expanding SaaS and data solutions 5 Managed services and transformation large deal wins 5
Slide 6: Our focus and commitment to sustainability rewarded with highest market recognitions
Our focus and commitment to sustainability People rewarded with highest market recognitions Planet Impact Society through customers Own Ethical operations Climate conduct action Exciting place to work 70% reductions in scope 1 95% green electricity 31%- share of female and 2 GHG emissions used in da
Slide 7: Q4'22 financials
Q4’22 financials 7
Slide 8: Tietoevry Q4'22
Tietoevry Q4’22 Business highlights Organic growth* 9% Revenue EUR 767.7 million, organic growth* 9% Adj. EBITA** 15.4% (up 1.5%) Reported growth 3.5%, currency and divestment impact net EUR 37 million negative Growth 9% driven by Tietoevry Banking, Tietoevry Care and Tietoevry Create Adjusted EBITA
Slide 9: Tietoevry Create
Tietoevry Create Digital consulting, analytics and software engineering services Business highlights Organic growth* 11% Revenue EUR 219.3 million, organic growth* 11% Adj. EBITA** 15.9% (up 2.5%) Adjusted EBITA** EUR 34.8 (27.9) million, 15.9% (13.4) High market activity in cloud native, data and s
Slide 10: Tietoevry Banking
Tietoevry Banking Software for financial institutions Business highlights Organic growth* 15% Revenue EUR 144.3 million, organic growth* 15% Adj. EBITA** 17.8% (up 4.2%) Adjusted EBITA** EUR 25.6 (17.7) million, 17.8% (13.6) Strong growth across portfolio: Payments, Cards, Core Banking, Financial Cr
Slide 11: Tietoevry Care
Tietoevry Care Software for health and care services Business highlights Organic growth* 14% Revenue EUR 63.0 million, organic growth* 14% Adj. EBITA** 32.2% (down 1.2%) Adjusted EBITA** EUR 20.3 (19.0) million, 32.2% (33.4) Strong growth across Healthcare, Welfare and Custom Solutions & Laboratory
Slide 12: Tietoevry Industry
Tietoevry Industry Industry-specific software and data platforms Business highlights Organic growth* 3% Revenue EUR 69.7 million, organic growth* 3% Adj. EBITA** 18.1% (up 0.4%) Adjusted EBITA** EUR 12.6 (13.2) million, 18.1% (17.7) Growth acceleration in Pulp & Paper, and Education Large customer c
Slide 13: Tietoevry Transform
Tietoevry Transform Enterprise IT services for selected customers Business highlights Organic growth* 6% Revenue EUR 125.7 million, organic growth* 6% Adj. EBITA** 11.5% (up 3.6%) Adjusted EBITA** EUR 14.4 (9.6) million, 11.5% (7.9) Healthy growth in Industry & Forest, decline in Retail & Financial
Slide 14: Tietoevry Connect
Tietoevry Connect Infrastructure capacity and services Business highlights Organic growth* -3% Revenue EUR 216.4 million, organic growth* -3% Adj. EBITA** 8.4% (down 1.1%) Adjusted EBITA** EUR 18.3 (22.1) million, 8.4% (9.5) Growth of 11% in Cloud Platforms and Security Services Traditional infrastr
Slide 15: Strategic reviews to accelerate value creation – progressing as planned
Strategic reviews to accelerate value creation – progressing as planned TIETOEVRY BANKING STRATEGIC REVIEW TIETOEVRY TRANSFORM & CONNECT STRATEGIC REVIEW Potential strategic Strategic review Go-live with review announced 30 integrated Strategic review conclusions Nov’22 business decisions Q1’24 Nov’
Slide 16: CFO report
CFO report 16
Slide 17: CFO highlights
CFO highlights Q4’22 financials – strong growth and profitability Q4’22 other • Organic growth 9% (3%) – driven by Tietoevry Create, • Dividend of EUR 1.45/share, total EUR 172 million proposed Tietoevry Banking and Tietoevry Care for FY2022 – EPS EUR 1.59 (2.46) • Adjusted operating margin EUR 118
Slide 18: Solid Q4 operating cash flow – Net debt / EBITDA 1.5x
Solid Q4 operating cash flow – Net debt / EBITDA 1.5x EUR 166 (169) million cash flow from operations MEUR 165 • Seasonal net working capital decrease of EUR 34 127 million • Impact of growth on working capital 25 Free cash flow of EUR 127 (165) million 169 62 8 40 166 • Q4’21 free cash flow impacte
Slide 19: Attrition decreasing while inflation remains at high levels
Attrition decreasing while inflation remains at high levels Attrition continued to decrease– rolling 12-month attrition 14.4% Attrition in Q4’22, compared to 15.3% in Q3’22 % last twelve months (voluntary) 14.6 16.5 16.3 15.3 14.4 Net personnel increase of approx. 250 FTEs year-over-year1 Q4 21 Q1 2
Slide 20: Performance drivers – Q1'23
Performance drivers – Q1’23 • Continued good momentum in Tietoevry Create, Tietoevry Banking and Tietoevry Care • Decline in traditional infrastructure services anticipated to continue, driven by Growth drivers acceleration of cloud transformation • Price increases gradually taking effect • Continue
Slide 21: Our way forward
Our way forward 21
Slide 22: Market driven by customers resilience needs in an inflationary era
Market driven by customers resilience needs in an inflationary era 2023 dynamics Implications on technology services and software industry Market with high inflation and geopolitical uncertainty • Software and digital engineering services driving growth Customer focus on resilience, efficiency and b
Slide 23: Guidance for 2023
Guidance for 2023 Tietoevry expects its organic growth1 to be The company expects its full year adjusted operating margin2 (adjusted EBITA) to be 5–7% 13.0–13.5% (Revenue in 2022: EUR (13.0% in 2022) 2 928.1 million / 6%*) 1) Adjusted for currency effects, acquisitions and divestments 2) Adjustment
Slide 24: Way forward – specialization at the core of competitiveness
Way forward – specialization at the core of competitiveness Continued profitable Tietoevry Banking and Emphasis on Go to place for tech growth in software Tietoevry Transform & efficiency, price professionals –build and digital Connect strategic increases and on strong engagement engineering reviews
Slide 25: Thank you
Thank you Wiz tietoeucy