Slide 1: Interim Results FDM Group Presentation
Interim Results FDM Group Presentation Six months ended 30 June 2008 Rod Flavell – CEO David Templeman – CFO August 2008
Slide 2: About us
About us: An international IT Services company specialising in consulting solutions based around Sun Microsystems’ Java and Microsoft’s .Net programming platforms One of the largest UK independent IT specialists with overseas offices in Frankfurt, Luxembourg, Zurich and New York Mountie brand is rec
Slide 3: Interim highlights
Interim highlights Gross profit up 27.2% on H1 2007 to £6.50m, margins up to 25.6% (H1 2007: 20.9%) Profit before tax up 30.7% on H1 2007 to £2.39m Interim dividend of 1.0p (H1 2007: 0.8p) Increased demand for Mounties’ core technical competencies New customers in the period include EADS, BT, SciSys
Slide 4: KPIs
KPIs REVENUES GROSS PROFIT PROFIT BEFORE TAX MOUNTIE UTILISATION RATES em —m fm 2007 2008 2007 2008 2007 2008 2007 2008 GROSS MARGIN OPERATING MARGIN NUMBER OF MOUNTIES % % 2007 2008 2007 2008 2007 2008 yy
Slide 5: Freelance business
Freelance business Our freelance offering is an excellent route to clients Fast track to client relationships / speed to market Provides good market intelligence / “barometer” to changing market conditions Maintained a progressive policy of shedding low-margin business and driving gross margins up G
Slide 6: Global Services
Global Services Delivers blended teams of Mountie and freelance resources Delivering a range of services across our multi-national client base: Support Development Testing Training Significant development of this service offering with strong growth and contribution to profit Gross profits up 40.3% t
Slide 7: The Mountie business
The Mountie business Delivers highly trained technical IT consultants Up to 4 externally accredited training programmes lasting between 2-6 months Meeting industry’s growing demand for Java and .Net programming platforms Record number of Mounties being placed: 246 (H1 2007: 190) Maintained high util
Slide 8: The demand drivers for Java & .Net
The demand drivers for Java & .Net Sun first introduced its Java technology in 1995 and it has had a profound impact on the development of internet based technologies Microsoft responded to this challenge in 2002 when it launched its own .Net technology to directly rival Java As these technologies u
Slide 9: Capitalising on the opportunity
Capitalising on the opportunity FDM is able to attract high percentage of IT graduates as recognised leader in sector Circa. 2.5% of current overall numerical science students graduating in UK also certified through FDM Academy – target of 10% in next 5 years Mounties are selected after a rigorous a
Slide 10: Strategic development: organic growth
Strategic development: organic growth Possible new location Planned new London office more than doubles Glasgow capacity High student population Service based employment Manchester at full capacity in less than a year Manchester (60+ desks) Increased international focus on local Mountie Opened Decem
Slide 11: Our unique offering - filling a niche
Our unique offering - filling a “niche” Systems Integration and Consultancy £1,000 per day Our proposition High quality, onshore consultancy service at offshore prices Offshore and low margin £100 per day 11
Slide 12: Market challenges?
Market challenges? Turbulent Conditions Our “Sweetspot” Corporate cost cutting Mountie offer lower cost alternative to IT budget cuts “bulge bracket” consultancy Acute IT skills shortage in the UK Mountie Academy recognised as a centre of 141,000 new IT graduates a year excellence with high level of
Slide 13: Case study: HSBC
Case study: HSBC FDM created HSBC flagship Graduate Programme at Canary Wharf Head Quarters in 2006 within Equity Derivatives Expanded across all trading areas and office locations; London, NYC and Paris Total savings realised on Mounties vs Freelance equivalent circa £4m 06 Revenue: £1.3m 07 Revenu
Slide 14: Strategic development
Strategic development International Focus Successfully developed a number of cross-selling opportunities around our international network New business - broadened our offering with RBS/ABN providing them with an outsourced IT service in 4 locations to date with further roll-out planned Now service o
Slide 15: Financial highlights: profit & loss summary
Financial highlights: profit & loss summary 2008 H1 2007 H1 2007 FY £m £m £m Revenue 25.42 24.44 4.0% growth 49.83 Cost of Sales (18.92) (19.33) (38.60) Gross Profit 6.50 5.11 27.2% growth 11.23 Overheads (4.23) (3.36) 25.9% growth 13.9% New Academies (7.18) 12.0% Other costs Non-trading items 0.12
Slide 16: Financial highlights: balance sheet
Financial highlights: balance sheet 2008 H1 2007 H1 2007 FY £m £m £m Non-current assets 0.57 0.53 0.70 Trade / other receivables 11.75 9.02 9.53 Cash / cash equivalents 5.28 5.16 5.95 17.60 14.71 16.18 Equity 11.77 8.87 10.50 Trade / other payables 5.83 5.84 5.68 17.60 14.71 16.18 16
Slide 17: Financial highlights: cashflow
Financial highlights: cashflow 2008 H1 2007 H1 2007 FY £m £m £m Profit for the period 1.58 1.21 2.83 (Inc) / dec in receivables (2.43) 1.10 0.67 Increase in payables 0.59 1.13 0.69 Other items (0.05) 0.23 0.50 Net cash from operating (0.31) 3.67 4.69 activities Cash / cash equivalents 5.28 5.16 5.95
Slide 18: Financial highlights: geographic analysis
Financial highlights: geographic analysis 2008 H1 2007 H1 2007 FY £m £m £m Gross Profit UK 5.48 84% 4.40 86% 9.65 Europe 0.74 12% 0.52 10% 1.16 America 0.28 4% 0.19 4% 0.42 6.50 100% 5.11 100% 11.23 Profit before tax UK 2.04 85% 1.58 86% 3.80 Europe 0.20 9% 0.19 11% 0.32 America 0.15 6% 0.06 3% 0.14
Slide 19: Clients: a diverse portfolio of blue-chip businesses
Clients: a diverse portfolio of blue-chip businesses Finance and Insurance Sector 2008 H1 2007 H1 Breakdown Fund, Asset and Wealth mgnt. 6% 9% Investment Banking 36% 27% Retail and Corporate Banking 2% 2% Insurance 5% 6% 19
Slide 20: New client wins
New client wins Part of 10 company consortium Fire Control training delivery £5m over 3 years Highly visible project to create online catalogue for 750,000 non food items Jurisdiction to client, competitive pricing model, approach and technical capability - testing £85k revenue – first engagement Te
Slide 21: Summary
Summary Robust and resilient Mountie model – utilisation rates of almost 100% Continuing to attract multi-national organisations with large IT infrastructures Maintaining strong organic growth and industry leading growth margins UK market still at the forefront of growth 21
Slide 22: Outlook
Outlook International proposition gaining momentum for longer term growth Demand for Mounties far out-strips our current supply capabilities Global Services – ‘Testing’ & ‘Support’ – gaining traction Capacity constraints addressed as we continue to invest in our training centres Continued strong org
Slide 23: FDM Group Presentation
FDM Group Presentation