Zalaris Asa · OSL:ZAL
Zalaris Asa — Q2 2016 Earnings Presentation
19 slides from Zalaris Asa's earnings presentation, Aug 18, 2016
Slide 1: Zalaris ASA Interim report Second quarter and first half year 2016
Zalaris ASA Interim report Second quarter and first half year 2016 Thank you for joining us. The presentation will begin shortly. Please note: • Use the provided phone based dial-in instructions for listening to the presentation; • All attendees will be in muted mode during the presentation; • We wi
Slide 2: Interim report | Second quarter and first half year 2016
Interim report | Second quarter and first half year 2016 Oslo, 18 August 2016
Slide 3: Presenters and agenda
Presenters and agenda Agenda • Recent highlights Hans-Petter Mellerud • Financial performance in second Founder and CEO quarter and first half year of 2016 • HR Outsourcing market • Outlook Nina Stemshaug CFO © 2016 2014 Zalaris Page: 3
Slide 4: New milestone passed. Further improvements in performance through efficiency initiatives and offshoring
New milestone passed. Further improvements in performance through efficiency initiatives and offshoring Financial indicators Strategic milestones • Q2/16 revenues was NOK 95 million, up • Secured two new contract. With SAS and 3.1 % year-on-year, and 6.8 % before a Leading Utility Company to provide
Slide 5: Operational key performance indicators: 200,000 client employees served
Operational key performance indicators Major milestone passed. 200,000 client employees served Employees served (1000’) 210 • Number of employees served by Zalaris 200 200 196 HR Outsourcing reached 200,000 in the 191 quarter. 189 190 190 • Volume of transaction services delivered up 5.6 per cent co
Slide 6: Operational key performance indicators: Efficiency continues to improve
Operational key performance indicators Efficiency continues to improve • Productivity continues to improve. Employees and productivity Average number of employees served per local and nearshore FTE (full time 340 760 equivalent) was 748 in Q2/16, up from 320 740 678 one year earlier 300 720 • Number
Slide 7: Comparable Q2/16 revenues increased 6.8 % from last year. Cloud growing in importance
Comparable Q2/16 revenues increased 6.8 % from last year. Cloud growing in importance • HR Outsourcing segment represent Operating revenues 91 % of group revenues. Share declines as Cloud Services grows 110 • As usual in Q2 and Q3, seasonal variations impact on HR Outsourcing 100 98,5 revenues. Last
Slide 8: Operating profit slightly reduced. Some temporary costs related to transfer to Chennai
Operating profit slightly reduced. Some temporary costs related to transfer to Chennai and increased licence costs • Operating profit in Q2 2016 was NOK 7.1 Group operating profit million or 7.5 %. Normal seasonal variations 12 • Personnel cost share of total costs are 9.6 % Profit margin in % 7.5 %
Slide 9: HR Outsourcing segment: Normal seasonal variations, some temporary additional costs
HR Outsourcing segment: Normal seasonal variations, some temporary additional costs Operating revenues Operating profit and margin • HR Outsourcing represent 91 % of • Personnel costs reflect current excess group revenues, variations are normal capacity during build-up and transfer of due to seasona
Slide 10: Positive cash flow from operations, strong financial position
Positive cash flow from operations, strong financial position Cash and cash flows Q2/16 • Cash flow from operations was NOK 10.8 million, reversing build- 70 up of accounts receivables in 4,3 previous quarter 60 10,8 • Investments in data security and 50 17,1 digitalization of service delivery 40 pr
Slide 11: Buyers have two distinct approaches to adopt HR outsourcing
Buyers have two distinct approaches to adopt HR outsourcing – Single-process HRO (SPHRO) and Multi- process HRO (MPHRO) © 2016 2014 Zalaris Page: 11
Slide 12: Payroll outsourcing market is the largest HRO market and consists of two very different markets
Payroll outsourcing market is the largest HRO market and consists of two very different markets © 2016 2014 Zalaris Page: 12
Slide 13: Multi Country Payroll Outsourcing market is much more attractive to pursue
Compared to Single Country Payroll Outsourcing, the Multi Country Payroll Outsourcing market is much more attractive to pursue © 2016 2014 Zalaris Page: 13
Slide 14: The Multi Country Payroll Outsourcing market has grown rapidly at a CAGR of 20-25%
The Multi Country Payroll Outsourcing market has grown rapidly at a CAGR of 20-25% from 2014 to 2015 to reach US$ 1.3 - 1.5 billion © 2016 2014 Zalaris Page: 14
Slide 15: Multi Country Payroll Outsourcing – we are well positioned for continued success
As Zalaris from the onset has been designed to deliver Multi Country Payroll Outsourcing – we are well positioned for continued success in this market Local language service centers and payroll consultants in country that we operates One common SAP based system supporting 50+ country payroll legisla
Slide 16: Concluding remarks: Good first half of 2016
Concluding remarks: Good first half of 2016 • Short-term topline growth below target, but demand remains strong for Zalaris services • Signed new agreements with three new large blue chip customers in H1 with a total of 8,000 employees • Serving more than 200 000 client employees, and have further s
Slide 17: 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 18: Questions?
Questions?
Slide 19: 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