EDB increased its revenue by 27% to NOK 2,145 million in the fourth quarter of 2008, and continued to increase its market share in the Nordic IT services market. This represents the company's highest ever quarterly revenue.
Operating profit before intangible asset amortisation (EBITA) was 12% higher at NOK 193 million.
"I am very pleased that we continued to win market share in a quarter characterised by the uncertain outlook for the international economy, and that we were able to do this while at the same time maintaining satisfactory profitability. We start 2009 with an order backlog of almost NOK 12 billion, which secures good visibility for the company", comments Endre Rangnes, CEO of EDB.
2009 will be a challenging year with a strong focus on costs in many sectors and industries. Making proper use of IT will be an important tool for companies looking to strengthen their competitive position.
"This opens up new and attractive opportunities for EDB to sell solutions and services that allow our customers to improve IT efficiency and reduce costs", adds Endre Rangnes.
Highlights of the fourth quarter of 2008
- Operating revenues up by 27% to NOK 2,145 million.
- Application Services reports organic growth of 11% for the fourth quarter.
- Operating profit before intangible asset amortisation (EBITA) was NOK 193 million for the fourth quarter as compared to NOK 173 million for the same quarter of 2007.
- Strong cash flow from operations, up by 16% to NOK 606 million.
- EDB signed new contracts with customers in the fourth quarter representing total contract value of NOK 850 million.
- Extraordinary costs of NOK 44.1 million charged to the fourth quarter accounts.
o Provision of NOK 66.1 million for the cancellation of an application operating services contract with the City of Oslo.
o Closure of a pension scheme at IS Partner caused a non-recurring reduction in estimated pension liability of NOK 22 million.
- Net interest bearing liabilities reduced by almost NOK 400 million to NOK 3,020 million.
- Earnings per share for the fourth quarterrter of 2008 of NOK 0.29. The fourth quarter of 2007 produced earnings per share of NOK 0.85.
Highlights of 2008
- Operating revenues of NOK 7,871 million as compared to NOK 6,354 million in 2007.
- Operating profit before intangible asset amortisation (EBITA) of NOK 724 million in 2008 as compared to NOK 607 million in 2007.
- Cash flow from operations before non-recurring items was NOK 759 million in 2008 as compared to NOK 807 million in 2007.
- Operational investment spending (Capex) was NOK 338 million in 2008, as compared to 246 million in 2007.
- Earnings per share of NOK 1.92, as compared to NOK 3.32 for 2007.
- Due to the uncertain conditions in the financial markets and the company's capital structure, the Board has resolved to propose to the Annual General Meeting that no dividend should be paid for 2008.
- Total order backlog at the start of 2009 of almost NOK 12 billion
The Nordic IT services market grew by around 4% in 2008 according to the research company IDC. The level of activity was high at the start of the year, but the fourth quarter was characterised by considerable uncertainty and clear signs of weaker growth, especially in the consulting market. As a result of the outlook for slower GDP growth for the Nordic countries and much weaker corporate earnings for Nordic companies, IDC and other analysts expect zero growth in the IT services market in 2009. EDB is monitoring the market situation closely, and pays particular attention to the company's readiness to adapt rapidly to changes in market conditions if the situation so requires.