– Revenue increased 23% to € 25.8 million (Q3 2016: € 21.0 million), organic revenue growth trend continued.
– EBITDA came in at € 2.5 million, an increase of 19% compared to € 2.1 million in Q3 2016.
– Focus on integration and consolidation of acquisitions continued; integration HTS ongoing.
– In the first nine months of 2017 revenue was up 21% to € 76.5 million (9M 2016:
€ 63.1 million), organic revenue growth 8%.
– EBITDA amounted to € 7.8 million (9M 2016: € 6.3 million), an increase of € 1.5 million.
– For the full year 2017 EBITDA expected between € 11.5 million and € 12.5 million.
Jos Blejie, CEO of ICT Group N.V.: “In the third quarter we continued our disciplined approach towards integration and consolidation. The integration process of HTS, which we acquired last June, is ongoing and we completed the integration of Nozhup. All ICT subsidiaries contributed to the growth realized in the past nine months. In particular ICT Nearshoring and BMA performed well in the third quarter. BMA benefited from its delayed launch of a new generation fetal heart monitors. With the continued favorable economic conditions, we expect to pass the € 100 million revenue milestone this year and expect to realize an EBITDA between € 11.5 million and € 12.5 million.”
In the third quarter of 2017 revenue increased 23% to € 25.8 million compared to
€ 21.0 million in Q3 2017. Organically, excluding HTS (acquired in June 2017) and
2 months Nozhup (consolidated as of September 2016), revenue growth was in line with the previous quarters. For the first nine months of the year revenue amounted to € 76.5 million. All subsidiaries contributed to the 21% increase compared to last year. Organic revenue growth year to date is 8%.
Overall productivity levels within ICT Netherlands were in line with last year. Strypes Bulgaria showed a significant increase in revenue compared to Q3 last year. BMA performed above expectations, Improve and Raster performed in line with last year. All ICT subsidiaries recorded positive results. EBITDA came in at € 2.5 million in the third quarter, compared with € 2.1 million in the same period of 2016. Year to date EBITDA was up 24% to € 7.8 million (9M 2016: € 6.3 million), resulting in an EBITDA margin of 10.2% (9M 2016: 10.0%). The positive trend in ICT’s markets continued in the third quarter.
ICT focuses on the themes Smarter Industries, Smarter Cities and Smarter Health. Within these themes ICT delivers the highest added value to its customers. Due to the acquisitions of Nozhup and HTS, growth in the themes Smarter Industries and especially Smarter Cities was higher than in the Smarter Health theme.
Divestment of minority share in Strypes Nederland B.V.
In October Strypes Bulgaria (ICT Nearshoring) agreed to divest its minority stake (25%) in Strypes Nederland B.V. to the existing shareholders. As a consequence, transfer of the shares will take place early November. As part of this agreement Strypes Bulgaria and Strypes Nederland B.V. will continue their collaboration.
ICT will continue to further leverage the strategic platform it has successfully built over the past years, aimed at organic growth combined with acquisitions. ICT’s acquisition strategy is focused on achieving a more balanced position between the three main themes. Our solutions, enabling a digital transformation for our customers, will be deployed in all industries and further internationalized.
Overall ICT has benefited from favorable economic circumstances. The markets in which ICT operates are expected to continue this favorable trend in the fourth quarter of the year. The strong fourth quarter of last year was the first quarter in which the activities of Nozhup were fully consolidated.
Based on the above, ICT expects EBITDA between € 11.5 million and € 12.5 million for the full year 2017.
Round Table designed for leaders and decision makers
Manufacturers are embracing what’s recognized as “Industry 4.0” to redefine their businesses, such as company cultures. They’re creating higher-quality products at lower costs. They’re building entirely new business models and service offerings. And most importantly, they’re conserving limited resources to bring their customers a more sustainable future. According to IDC, the connected factory is already a reality as 40 percent of operational processes will be self-healing and self-learning by 2022.
By IDC’s estimates, manufacturing companies that take advantage of their data have the potential to to generate nearly $400 billion in revenue, in comparison to their peers who don’t capitalize on their data. It’s creating a virtuous cycle with savings being reinvested on innovation. However, while leading manufacturers are reaping the results disrupting technologies bring, the gap is widening between those who have started down this path and those who have not. Our advice is simple: if a business hasn’t developed a digital strategy, start now so your business can lead the
transformation and maintain or gain a competitive advantage.
Our key speakers
Taner Paca, product specialist at Omron is passionate about Factory Automation within the Industry 4.0 domain. He is proud to be part of an organization which has been listed as one of the Top 100 Global Innovators in 2016. On a daily basis, Taner works on advising organizations how the industry can use big data to improve productivity and move to a fully automated Dark factory.
Patrik Boccara is a Senior Sales Specialist at Tele2 IoT and co-founder and former CEO of the IoT-startup Kombridge, recently acquired by Tele2 IoT. Patrik is a software entrepreneur with a background in Internet-of-Things telematics and automotive.
Jan Depping has been an Azure Technology Strategist at Microsoft since the beginning of 2004 and has a great passion for translating business needs into practical and easy to execute technical solutions. The Internet of Things & Industry 4.0 in combination with Machine learning, Predictive Analytics, Big Data, Data Lake Services, Data Warehouse Services and Security & Privacy are driving his daily activities.
During the Demolab Event you can view software solutions and products that in many cases save or greatly improve the life of patients. Software solutions that will amaze you and are of great importance for society.
ICT Healthcare likes to invite you to this innovative and educational event on Thursday, November 16th at the Gasfabriek in Deventer.
We will show you this evening demonstrations of:
– Clinical Decision Support Systems;
– Workflow and data management systems for hospitals;
– Transplantation system for organs;
– Systems for the treatment of rheumatic diseases;
– Diagnostic systems.
Het Event over Industriële Automatisering dat je niet mag missen!
Op donderdagavond 16 november 2017 vindt het ICT Group Kennis Event: Trends en ontwikkelingen in IA 2017 plaats bij het Muntgebouw in Utrecht.
Deze avond gaat over oplossingen die je helpen om processen in industriële omgevingen efficiënter, flexibeler, eenvoudiger, veiliger en duurzamer te maken. Met aansprekende sprekers van Raster, Siemens, Schneider, Wonderware BNL, ABB en ICT Group. Zij geven tijdens het Kennis Event presentaties over onderwerpen als Cybersecurity, Smart Manufacturing, Safety systemen, Data-analyse, Telemetrie & GIS Integratie en nog veel meer. Laat je op deze avond inspireren en informeren over alles wat met Industriële Automatisering te maken heeft.
Monitoring the pregnancies of women with health issues is vital to prevent child mortality. But this form of healthcare is also very expensive. Telenatal and BMA, ICT Groups’ IT healthcare specialists, have developed a way to improve monitoring and make it less expensive.
In the NOS journal of Saturday, September 16th you can see a good example of the use of Sense4Baby by a pregnant mother who did her own monitoring, without any help from a nurse or midwife. Specialists at the hospital can check the readings via a web portal. The CTG readings can also be added to the patient’s records in the hospital system via a seperate interface. The Mosos system of BMA.
Revenue increased 20% to € 50.7 million, 6% organic growth
EBITDA up 28% to € 5.3 million (H1 2016: € 4.2 million)
Net profit at € 2.6 million, an increase of 20% (H1 2016: € 2.1 million)
Focus in H1 2017 on integration and consolidation of acquisitions
Continued investments in the organization to support future growth
Acquisition of high technology automation services provider HTS
Outlook 2017: ICT expects further growth in revenue and EBITDA in the second half of 2017 compared to the first half of 2017
Jos Blejie, CEO of ICT Group N.V.: “In the past six months we have prioritized the integration of the acquisitions of the past year to safeguard a proper basis to consolidate future potential, without losing focus on driving organic growth. Nozhup, that is now fully integrated, contributes positively to the Group’s results. With our latest acquisition HTS, that will primarily service Smart Industries, we passed the milestone of 1,000 employees. With this increased group of dedicated professionals, we are fully committed to further executing the company strategy, making the world a little smarter every day. We also continued our investments in the organization, companywide, to ensure a stronger foundation on which we can further build our company. We are confident about the second half of the year and therefore expect further growth in revenue and EBITDA in the second half compared to the first half of 2017.
In June 2017 ICT acquired High Tech Solutions B.V. (“HTS”), a Dutch based well-respected industrial automation project and services provider. HTS employs 25 professionals on an HBO / academic level. HTS delivers consultancy services in various markets within the domain of Smarter Industries.
During the first six months of 2017 we continued our investments in new platforms and start-ups. Developments at ICT Mobile are promising and a new platform was launched together with start-up company Valuemaat.
By the end of the first half of 2017, ICT passed the mark of 1,000 employees.
Notes to the results
In the first half year of 2017 ICT Group’s revenue came in at € 50.7 million, up 20% compared to € 42.1 million reported in H1 2016. The revenue growth showed a consistent trend. Organically, excluding the contribution of Nozhup and HTS, revenue increased by 6%. This was driven by an increased number of staff and productivity in line with last year.
Revenue at ICT Netherlands increased 22% to € 39.3 million in H1 2017 from € 32.3 million in the same period last year. The increase is mainly attributable to Nozhup that was acquired in September 2016, and fully integrated within ICT Netherlands in the first half of 2017. Organically, revenue was up approximately 5%. Main contributor to this organic growth was the business unit Automotive. Productivity levels were in line with last year. The average tariff increase was in line with the average salary increase. EBITDA came in at € 3.6 million in H1 2017 (H1 2016: € 2.6 million). Licences and materials sales were in line with last year.
Strypes Bulgaria (“ICT Nearshoring”) reported a 46% increase in revenue from € 3.2 million in H1 2016 to € 4.6 million in the first six months of 2017. In 2016 Strypes started to upgrade the organizational effectiveness to safeguard continued and sustainable strong growth of the nearshoring activities. In the first six months of 2017 these investments, in among others quality controls, continued and will continue in the second half. EBITDA amounted to € 0.9 million in H1 2017 (H1 2016: € 0.6 million).
The segment ‘Other’ recorded revenues of € 7.4 million (H1 2016: € 7.1 million). Improve had a slow start to the year, due to postponement of assignments. Recovery is expected in the second half of 2017. After a good 2016, in 2017 Raster experienced margin pressure as a result of more difficult market circumstances. BMA performed in line with last year.
ICT’s growth strategy focuses on the themes Smarter Industries, Smarter Cities and Smarter Health. Within these themes, ICT delivers added value to its customers.
Due to the acquisitions of Nozhup and HTS growth in the themes Smarter Industries and especially Smarter Cities was higher than in the Smarter Health theme.
Personnel costs increased significantly to € 31.0 million (H1 2016: € 24.9 million), primarily because of an increase in number of employees and salary increases.
Other operating expenses also increased, mainly because of the recent acquisitions. In the first half of 2017 the investment levels were similar to those in 2016. The investments focused primarily on housing and further operational effectiveness of the organisation. In addition, ICT continued investing more heavily in recruitment. The costs related to strategic initiatives and the realisation of acquisitions and partnerships amounted to € 0.1 million (H1 2016: € 0.3 million).
EBITDA for the first six months of 2017 increased by 28% to € 5.3 million, compared to € 4.2 million in the comparable period in 2016. The EBITDA margin increased from 9.9% in H1 2016 to 10.5% in H1 2017. The increased scale, following the acquisitions, leads to a more effective use of the indirect cost base.
Amortisation and depreciation
ICT has attributed a value to and is amortising several intangible assets, including order backlog, software and customer relations of its recent acquisitions. Amortisation in the first half of 2017 included Nozhup and amounted to € 1.2 million (H1 2016: € 0.9 million). Depreciation for the first half of 2017 amounted to € 0.5 million (H1 2016: € 0.3 million).
The operating profit amounted to € 3.7 million in H1 2017 (H1 2016: € 3.0 million). As a result of the higher amortization, the operating margin was 7.2%, at the same level as H1 2016 (7.1%).
Results from joint ventures and associates
The results from InTraffic were in line with last year and contributed € 0.1 million to the results
(H1 2016: € 0.1 million). The total result from joint ventures and associates amounted to a loss of € 0.2 million (H1 2016: € 0.1 million loss).
Interest expenses increased to € 0.3 million in H1 2017, from € 0.2 million in the first six months of 2016, as a result of increased financing for the recent acquisitions.
Taxes in the first half of 2017 amounted to € 0.7 million compared with € 0.7 million in the first half of 2016.
Net profit for the first six months of 2017 increased to € 2.6 million, compared with € 2.1 million in H1 2016. An amount of € 2.5 million is attributable to the shareholders of ICT Group N.V. (H1 2016: € 2.1 million). This translates into earnings per share of € 0.27 (H1 2016: € 0.24). The number of outstanding ordinary shares increased during the first half year 2017 to 9,411,301 (31 December 2016: 9,288,309) due to stock dividend and to the employee share participation plan.
Cash flow movement
In the first half of the year, net operational cash flow amounted to € 0.5 million negative in H1 2017 (H1 2016: € 0.3 million negative). The net cash position per 30 June 2017 decreased to € 1.0 million negative (31 December 2016: € 5.6 million positive). This was mainly due to the purchase price cash consideration of the acquisition of HTS, the payment of dividend, the repayments of existing acquisition financing and investments in housing facilities.
Balance sheet structure
In the first half of 2017, shareholders’ equity increased to € 44.5 million (31 December 2016: € 43.7 million) as a result of the net effect of dividend paid of € 2.1 million, net profit of € 2.6 million, and an equity increase of € 0.3 million as a result of issuing new shares (for the share participation plan for personnel and stock dividend). The balance sheet total increased from € 79.2 million at year-end 2016 to € 84.7 million at 30 June 2017, as a result of the acquisitions in the last six months. Solvency (shareholders’ equity/total assets) stood at 53% at the end of June 2017 (55% at year-end 2016).
At 30 June 2017, ICT Group has 1,014 employees (971 FTEs), around 6% higher than at year-end 2016. The acquisition of HTS, a low attrition in the first half of the year as well as increased recruitment efforts contributed to this increase.
ICT will continue to further leverage the strategic platform it has successfully built over the past years, aimed at organic growth combined with acquisitions. The aim of the acquisition strategy is to achieve strong positions in each of ICT’s three main themes. ICT continues its focus on the smarter themes by further deploying its solutions in Internet of Things enabling a digital transformation for its customers. Overall ICT has benefited from favourable economic circumstances. The markets in which ICT operates are expected to continue this favourable trend in the second half of the year. Some markets, such as Oil and Gas are more challenging than others.
Based on the above, ICT expects further growth in revenue and EBITDA in the second half of 2017 compared to the first half of 2017.
ICT Group and Cisco recently entered into a partnership to address the rapidly increasing demand for IoT (Internet of Things) applications and further digitization within the industry market segment. This cooperation is a logical sequel to the IoT cooperation between Cisco and Microsoft, as was announced recently. ICT Group’s expertise in the industrial market as well as its knowhow of both Microsoft and Cisco provide an excellent foundation to realize further digitization in this market.
Aart Wegink, Director Digital Transformation ICT Group: “The cooperation is aimed at delivering industry-proven technologies in the industrial market that will realize the integration between the IT and OT domains (operational technology) in a secure and reliable manner.”
“ICT Group is a visionary and an authority in the OT domain. We are very proud that ICT Group is going to work side by side with Cisco to bridge the gap between the IT and OT worlds. This will help our common clients in the utilities, manufacturing and mobility markets to successfully venture into the digital world. The need to break open technological silos to enable efficiency, open access to data and analytics in processes, system performance and cyber security as a business enabler, will unite us into a very promising combination”, says Daan de Groot, Channel Lead Cisco Nederland.
ICT Group N.V. (ICT) announces that it has signed a share purchase agreement to acquire 100% of the shares of High Tech Solutions B.V. (HTS), a Dutch based high technology automation services provider. The company was founded in 2006 and currently employs around 25 professionals on a HBO / academic level. HTS brings a customer set that is highly complementary to ICT. The acquisition supports ICT’s growth ambitions. High Tech Solutions is a well-respected industrial automation project and services provider. The company is located in Apeldoorn and delivers consultancy services in different markets like Telecom, Healthcare, Defence Security and High Tech Manufacturing. HTS realises profitable revenues of around EUR 2.5 million per annum. With this acquisition ICT passes the mark of 1,000 employees. Commenting on the closing, Jos Blejie, CEO of the ICT Group, stated: “We are pleased with the acquisition of High Tech Solutions. Although a niche player, HTS is bringing new, well respected, clients and specialised industry knowledge to the ICT Group. We warmly welcome our new colleagues and are proud to pass the milestone of 1,000 professionals. For many years HTS and ICT have worked together and both companies acknowledge that there is a clear cultural fit between the two companies. HTS will work closely together with ICT’s Machine & Systems business unit. The founders of HTS will remain involved until the end of 2018. The purchase consideration will be paid in cash. Further financial details will not be disclosed.
Revenue in Q1 up 21% to € 25.6 million (Q1 2016: € 21.1 million)
Organic revenue increase of 7%.
EBITDA increased by 27% to € 2.8 million (Q1 2016: € 2.2 million).
Integration of Nozhup accomplished
(in € millions)
Jos Blejie, CEO of ICT Group N.V.: “We have started the year 2017 in line with expectations across all our business segments, resulting in revenue and profitability growth in the first quarter compared with the first quarter of 2016. During the first three months we focused on the completion of the integration of Nozhup to be able to immediately reap the benefits of this acquisition. We continue to be committed to the execution of the company strategy, in which gaining market share and investments in new technologies and business solutions are key. Given the current positive economic circumstances we reiterate that we expect a further growth in both revenue and profitability for the full year 2017 versus 2016.”
Revenue in the first quarter of 2017 increased to € 25.6 million compared to € 21.1 million in the first quarter of 2016. Organically, excluding Nozhup and 1 month BMA (consolidated as from February 2016), revenue grew 7%. Due to the acquisition of Nozhup the segment ICT Netherlands increased substantially. Overall the markets ICT operates in continued their positive development this first quarter of 2017. In Q1 2017 ICT made further progress in the execution of its strategy with the completion of the integration of Nozhup into the ICT Netherlands organisation. All ICT subsidiaries recorded positive results. EBITDA came in at € 2.8 million in the first quarter, compared with € 2.2 million in the same period of 2016.
ICT has made clear choices in terms of growth. ICT focuses on the themes Smarter Industries, Smarter Cities and Smarter Health. Within these themes ICT delivers the highest added value to its customers. As Nozhup’s activities are focussed on Smarter Industries and Smarter Cities, in these areas more growth was realised this first quarter of 2017 than in Smarter Health.
Revenue split per theme (in € millions)
ICT Group completes integration of Nozhup
In September 2016 ICT Group acquired Nozhup, thereby gaining significant scale in the industrial automation market. Nozhup is consolidated for the full quarter in the segment ICT Netherlands. As part of the integration process of Nozhup into ICT a legal merger took effect at the end of March 2017.
ICT’s management reiterates the outlook given at the annual results announcement in March. ICT will continue to focus on the further leveraging of the strategic platform it has successfully built over the past years, aimed at organic growth combined with acquisitions. The goal of the acquisition strategy is to achieve strong positions in each of ICT’s three main themes. Overall, the markets in which ICT is active are developing positively from a demand perspective, although some markets do remain challenging. ICT expects its capital expenditures and research & development expenditures for 2017 to grow in line with the increased scale of the company. The tight labour market remains a potential bottleneck, and attracting and retaining the right people continues to be one of our key priorities. Based on the above, ICT expects further growth in revenue and EBITDA in 2017 compared to 2016.
A team of 5 developers (Luboslav Pirsafov, Hristiyan Yordanov, Ivan Hristov, Yordan Petrov, Trifon Statkov) representing the Strypes company competed in the CabSat 2017 appathon and created an innovative app called Linda that won the big award of the international competition in Dubai, United Arab Emirates. Award winning app The Linda app almost removes the necessity to have a remote control device. Ever wanted to simply say “Linda, play CNN” and your TV plays CNN? It is possible with Linda. You no longer need to memorize channel numbers or go through the mundane task of navigating between to find one specific show. Apart from this feature, Linda realizes several other user scenarios. You can search for the show or the game you want to watch, Linda will find the channel on which the event is airing and you will be able to easily switch to that channel with a simple command. Just start Linda and she will give you the exact TV content you want. The app provides even more useful features such as muting/unmuting, checking definitions from Google, searching for YouTube content and more. Trifon Statkov, Software Developer at Strypes, wrote a blog about the competition that you can read here. Strypes and ICT Group Strypes Bulgaria, founded in 2008, is a reputable near-shore company which delivers IT services (consultancy, project-management, development and engineering) through an effective near-shoring model. The combination of market knowledge, skilled professionals and technology specialization enables Strypes Bulgaria to provide best in class solutions for complex technology challenges of its clients. In January 2015 ICT Group completed the purchase of 100% of the shares of Strypes Bulgaria.
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