Ad-hoc | 27 March 2007 10:56
CENIT AG Systemhaus / Final Results Release of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. ---------------------------------------------------------------------- CENIT Software as growth and earnings driver Stuttgart, March 27, 2007 – For CENIT 2006 was characterised primarily by expanding international business and related investments in further profitable growth. Higher marketing and sales expenditure resulted particularly from the successful expansion of the US business and higher revenues from the sale of CENIT software via distribution partners such as SAP, IBM/FileNet and Dassault Systèmes. In 2006, the number of employees across the group again increased by 10% and now totals 576. The foundation of a new company in Romania in 2006 is also a necessary investment to improve the company’s competitive ability. The basis for figures for 2006 is preparing the future of CENIT and its strategic alignment. In financial year 2006, CENIT generated group sales of € 82.4 million (2005: € 74.3 million / 11%). The services area again generated strong growth. This was accompanied by an extremely positive development in selling CENIT proprietary software. Gross profit rose again, by 13% to € 59 million (2005: € 52.1 million). EBITDA reached € 11.1 million (2005: € 10.2 million / 9%). In the reporting period, EBIT moved up from € 9.4 million by 9% to € 10.2 million. CENIT will conclude an extremely important and positive year with EBT of € 10 million (2005: € 9.1 million / 10%) and group earnings per share (EPS) of € 1.00 (2005 adjusted: € 0.81). Earnings per share include a positive non-recurring effect of € 699 thousand from one-off corporation tax income. The good earnings situation positively impacted the group assets situation. As of the reporting date, equity totalled € 24.3 million (2005: € 19.6 million), resulting in an equity ratio of 62% (2005: 58%). As of the balance sheet date, bank balances and securities totalled € 18.7 million (2005: € 20.8 million). Cash flow from operating activities was € 10.3 million (2005: € 8.9 million), with a free cash flow of € 1.6 million being reached (2005: € 4.4 million). Dividend proposal The Executive Board and Supervisory Board will propose the shareholders’ meeting the distribution of a dividend of EUR 0.50 to the shareholders and the transfer of € 3.5 million to revenue reserves. Breakdown of sales In the Product Lifecycle Management segment, CENIT achieved sales of € 53.9 million (2005: € 48.9 million / 10%) and an EBIT of € 6.9 million (2005: € 6.4 million / 8%). The Enterprise Content Management segment posted sales of € 28.5 million (2005: € 25.4 million/ 12%) and an EBIT of € 3.3 million (2005: € 3.0 million / 10%). Sales with CENIT software increased by 47% to € 11.2 million. Now 14% of sales are achieved with CENIT proprietary software. In the previous year, the figure was € 7.7 million, approximately 10% of total sales. The business with third-party software also increased, by 13% to € 9.4 million (2005: € 8.3 million). The development in the services area is equally pleasing. Sales again increased, by 9% to € 46.8 million (2005: € 42.8 million). The hardware business declined by 3% to €15 million (2005: € 15.5 million). Foreign subsidiaries In the past financial year, CENIT (Schweiz) AG generated sales of € 2.6 million (2005: € 1.3 million) and an EBIT of € 1.1 million (2005: € 56 thousand). The software solution FileNet Systems Monitoring was the key driver for results and sales. On sales of €4.7 million (2005: € 1.7 million), CENIT North America Inc. posted an EBIT of € 0.4 million (2005: € 0.2 million). With a total of 17 employees and a positive earnings contribution already been made to the group, the decision of the Executive Board to develop the software and consultancy business in the USA in a rigorous fashion was confirmed on a sustained basis. In the 2006 financial year, CENIT also founded a subsidiary in Romania. In the application management and software development area, CENIT is now able to face the market on a more competitive basis. The company is being developed and is to be further extended in 2007. Smaller initial projects were already processed in 2006. On sales of € 0.03 million, CENIT SRL generated an EBIT of € 0.01 million. Order situation As of December 31, 2006 the order backlog for the group was € 18.2 million (2005: € 19.3 million) and incoming orders in 2006 totalled approximately € 84.8 million (2005: € 79.6 million). Overall, the share of new customers increased to 7% in 2006. Outlook CENIT has established the objective to increase the share of proprietary software in total sales to between 20 and 30 percent over the next two to three years. To do this, it is necessary to expand the international distribution channel further. A fundamental element of this strategic focus is the existing distribution and software development cooperation with Dassault Systèmes, SAP, FileNet and IBM. For group sales we expect growth in line with the market in 2007 and 2008. In particular, increasing revenues for the sale of CENIT proprietary software and the worldwide distribution cooperation for the FileNet System Monitoring solution will contribute to this. With the strategic alignment on the attractive markets for Product Lifecycle Management, Enterprise Content Management and Application Management Outsourcing and concentration on our core competencies, CENIT will also invest strongly in the consultancy and software market in 2007 and 2008. We anticipate that in 2007 and 2008 all segments will contribute to improving further the operating performance of the group. Our market and customer contacts in all segments are a good basis for offering our business partners supplementary products and services. Added to this is a consistent alignment to the world market and the expansion of our USA activities, particularly in the software area together with SAP and Dassault Systémes. The development of our subsidiary for software development and application management outsourcing services in Romania in line with the market is a further important step to improve competitive strength at CENIT. We continue to expect a positive market environment in our relevant markets. We want to take this opportunity to gain further market share. For this reason, CENIT wants to increase its staffing levels by 10% again in 2007. Should the trend continue, then a further expansion in staff numbers is to be expected in 2008. We want to become stronger, particularly in the consultancy business and in bespoke software development as well as advancing our US business with American staff. The expansion of the US business initiated in 2006 brought with it a strong increase in marketing and sales expenses. This will again be the case in 2007 as the market opportunities in the USA are stronger than the possible risks. Enquires to: CENIT AG Systemhaus ISIN:DE0005407100 Fabian Rau Vice President Investor Relations & Marketing Industriestraße 52-54, D-70565 Stuttgart Tel.: +49 711 7825-3185 Fax: +49 711 782544-4185 E-Mail: f.rau@cenit.de --------------------------------------------------------------------------- Information and Explaination of the Issuer to this News: Information about CENIT: CENIT AG Systemhaus is an internationally operating consulting company which employs more than 570 people. Focusing Product Lifecycle Management Consulting, Application Managemnet Outsourcing and Enterprise Content Management solutions, the company was founded in 1988 and is listed in Germany's Prime Standard. Customers are Allianz, BMW, DaimlerChrysler, EADS, Airbus, AXA, Metro ,VW and many small and medium-sized enterprises. Forward-Looking Statements: This news release may contain forward-looking statements about the business, financial condition, results of operations and earnings outlook of CENIT Words such as 'may','will','expect','anticipate','contemplate' 'intend','plans','believe','continue' and 'estimate' and variations of these words and similar expressions, identify these forward-looking statements. These statements are not guarantees of future performance, involve certain risks, uncertainties and assumptions that are difficult to predict, and are based upon assumptions as to future events that may not prove accurate. Therefore, actual outcomes and results may differ materially from what is expressed herein. In any forward-looking statement in which CENIT expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement or expectation or belief will result or be achieved or accomplished. Actual operating results may differ materially from such forward-looking statements and are subject to certain risks. http://www.cenit-group.com DGAP 27.03.2007 ----------------------------------------------------------------------