Quarterly Results: Major Advances in 1st Quarter
Stuttgart, 30 April 2008 – AC-Service is off to a successful start in the financial year 2008. The results for the 1st quarter show once again the kind of strength that comes from a business model that is becoming better integrated, embraces the entire IT value chain of small to mid-sized businesses and enables comprehensive service and support for the customer. This end-to-end sales and support approach also proved to be a success factor in the largest licensing deal in the company's history, which the AC-Service unit All for One landed in the 1st quarter of 2008 along with a whole series of other new client projects.
Realignment taking giant steps forward
The realignment that began in 2007 with the goal of becoming a leading IT service provider for SAP in the German-language midmarket segment is making great strides in 2008. The new Chief Financial Officer is Stefan Land. The reorganisation of the board of directors, which began in 2007, is now complete. The decision to sell the wholly-owned subsidiary ACCURAT Informatik GmbH is another consequence of the focus on the SAP midmarket segment. The exclusive sales negotiations that were announced on 14 February 2008 have started. ACCURAT has been reported separately as a discontinued operation (IFRS 5) since that time. The realignment and the implementation of the strategy are also reflected in a change in the reporting of the AC-Group's operating segments (IFRS 8). The two business units "Integrated Solutions" and "HR Solutions" highlight this newly formed, integrated business model.
Continued robust and dynamic growth curve
The AC-Group is continuing with its robust and dynamic approach to expansion in the 1st quarter of 2008. Big gains in sales compared to the corresponding prior-year quarters have now been posted over 9 consecutive quarters. Not including the discontinued ACCURAT division, sales grew 19% to EUR 21.7 million in this 1st quarter of 2008. The 1st quarter's EBITA was EUR 0.8 million (Q1 2007: EUR 1.1 million) and the EBIT was EUR 0.6 million (Q1 2007: EUR 0.9 million). The prior-year EBITA and EBIT mentioned include investment tax credits in the amount of EUR 0.7 million that are attributable to other periods. A comparison on an adjusted basis shows an increase in EBITA of +81% and in the EBIT of +197% and illustrates the excellent progress that was made in operating earnings performance during the 1st quarter of 2008. Earnings after taxes totalled EUR 0.1 million (prior-year quarter: EUR 0.5 million) and represent quarterly earnings per share of 2 euro cents (Q1 2007: 10 euro cents) in the continuing divisions.
The staffing strength as at the end of the quarter increased 19% from 367 to 438 full-time employees. Total cash and cash equivalents declined from EUR 7.4 million (31 December 2007) to EUR 5.2 million and are at a relatively low level. The sustained high speed of growth and the further expansion of IT infrastructures also result in an investment peak in 2008, which cannot be funded solely from the operating cash flow. A new debt-financing strategy geared to the longer term has been developed. The negotiations with financing partners that are currently in progress should be concluded in the course of the 2nd quarter of 2008 and will enable the AC-Group to continue with its dynamic growth strategy.
The good operating results of the 1st quarter of 2008 will keep the AC-Group among the fastest-growing IT services companies in the SAP midmarket segment. The Management Board has confirmed its projections for the full 2008 financial year of achieving annual sales of EUR 82 to 85 million, an EBITA of EUR 2.3 to 2.7 million, as well as an EBIT of EUR 1.3 to 1.7 million.
The full Quarterly Report 1/2008 will be published as scheduled on 8 May 2008.