Financial results

Strong growth in both product revenue and EBIT 

April–June 2016 (second quarter)

  • License revenue amounted to SKr 190 million (Q2 '15: SKr 181 million), an increase of 10 percent, currency adjusted.
  • Maintenance revenue was SKr 300 million (Q2 '15: SKr 287 million), an improvement of 9 percent currency adjusted.
  • Consulting revenue amounted to SKr 421 million (Q2 '15: SKr 396 million), an increase of 10 percent currency adjusted.
  • Net revenue totaled SKr 923 million (Q2 '15: SKr 867 million), an improvement of 11 percent currency adjusted.
  • Adjusted EBITDA was SKr 118 million (Q2 '15: SKr 96 million). EBIT amounted to SKr 107 million (Q2 '15: SKr 64 million).
  • Cash flow after investments was SKr -9 million (Q2 '15: SKr -8 million). 
  • Earnings per share after full dilution amounted to SKr 3.21 (Q2 '15: SKr 1.83).

January–June 2016 (six months)

  • License revenue amounted to SKr 292 million (YTD '15: SKr 296 million), an increase of 3 percent currency adjusted.
  • Maintenance revenue was SKr 596 million (YTD '15: SKr 578 million), an improvement of 7 percent currency adjusted.
  • Consulting revenue amounted to SKr 825 million (YTD '15: SKr 770 million), an increase of 11 percent currency adjusted.
  • Net revenue totaled SKr 1,734 million (YTD '15: SKr 1,649 million), an improvement of 9 percent currency adjusted.
  • Adjusted EBITDA was SKr 174 million (YTD '15: SKr 159 million). EBIT amounted to SKr 108 million (YTD '15: SKr 115 million).
  • Cash flow after investments was SKr 37 million (YTD '15: SKr 64 million).
  • Earnings per share after full dilution amounted to SKr 3.18 (YTD '15: SKr 3.33). 

Outlook

For 2016, IFS expects growth in both product revenue and EBIT.

2016 Q2 Interim report

Strong growth in both product revenue and EBIT 

Although the global economic situation continues to be a cause for concern we have seen our business grow strongly in quarter two. The intake of business has come from both the winning of new accounts in an increasingly competitive market and from sales to our ever growing customer base. The demand remains strong for the solutions IFS provides to its target markets of asset intensive manufacturing, asset maintenance and service management.

Our good growth in license sales, 10 percent, currency adjusted, is due to our track record of reliably delivering sophisticated global business solutions with a lower total cost of ownership. Combining this growth in license sales with a high level of customer retention generates good growth in maintenance revenue of 9 percent currency adjusted. This continued growth in recurring revenue with a steadily improving margin is important to achieving our goals for the business.

Our heavy investment in recent years into building a partner ecosystem can be seen to be paying off by the ever increasing numbers of consulting, technology and sales channel partners we are attracting to work with IFS. This growing ecosystem gives us greater global reach, better scalability of resources and provides our customers with ever greater choice. Our consulting revenue grew by 10 percent currency adjusted which is higher than in recent quarters and was delivered using an increasing amount of partner resource.

Despite experiencing some headwind, the ERP market’s performance remains solid. Industry analysts such as Gartner have revised their estimates slightly downwards and expect the ERP market’s development to remain positive, with a growth in the 6 percent range in 2016.

Our improved EBIT, SKr 107 million (SKr 64 million), has been achieved by growing net revenue by 11 percent, currency adjusted, whilst keeping tight control on underlying costs. Having a regularly profitable business is enabling us to continue to prosecute an aggressive acquisition strategy to complement our organic growth.

We go into the second half of 2016 having a strong position to achieve our restated outlook of growth in both product revenue and EBIT. 

Alastair Sorbie 
President & CEO

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Investor Contacts

CEO Alastair Sorbie

Phone: 44 1494 428900

Contact Alastair Sorbie

Head of Investor Relations Frédéric Guigues

Phone: 46 8 58 78 45 00

Contact Frédéric Guigues