Page 55 - EVRY Annual Report 2012

From the Boardroom 55
Gjensidige, Posten and Storebrand that serve to demonstrate
the competitiveness of the new operations concept, and
these contracts will contribute to continuing innovation and
renewal of the customers’ major IT systems.
Financial statements
The group has prepared its accounts on the going concern
assumption, and the Board confirms in accordance with
Section 3-3 of the Norwegian Accounting Act that the go-
ing concern assumption is applicable. The group’s reported
results, its business strategy and its current budgets and fi-
nancing provide the basis for the going concern assumption.
Revenue
The group’s operating revenue in 2012 was NOK 12,731 mil-
lion, compared to NOK 12,841 million in 2011. The Solutions
segment reported organic growth of 4% for 2012, while the
Consulting segment reported organic growth of 3% for the
year. IT Operations reported negative organic growth of
3% for the year. Three out of four business areas within the
IT Operations segment reported positive organic growth
in 2012, and these areas account for approximately 75%
of the segment’s total revenue. The regional market, Bank
and Finance and the Swedish part of the segment all re-
ported positive organic growth in 2012. The activities facing
challenging conditions relate to the Norwegian part of the
enterprise segment (excluding Bank & Finance) and the
public sector, due to a fall in revenues from former IS Partner
customers and lack of new investments from some large
customers while they were carrying out tendering for their IT
requirements.
Operating result (EBIT)
The group’s operating result (EBIT) in 2012 was a profit NOK
485 million, as compared to NOK 626 million in 2011. EBIT was
negatively impacted by net non-recurring costs totalling NOK
173 million in 2012. A positive non-recurring amount of NOK
51 million was recognised in the first quarter of 2012 in relation
to the closure of a pension scheme for the former IS Partner
business. In addition, non-recurring costs of NOK 45 million
were recognised in relation to organisational changes in 2012.
The Board’s decision not to continue the Digital Public Sector
(DigOff) project resulted in a provision of NOK 112 million in
the accounts for the fourth quarter of 2012. In relation to the
transformation program for IT Operations (Future Proof), a
re-evaluation of the old solutions portfolio has been made and
resulted in an impairment of balance sheet items of NOK 67
million. Negative non-recurring items in 2011 totalled NOK
88 million, of which NOK 59 million related to restructur-
ing measures and NOK 29 million related to a write-down of
intangible assets. See also Note 3 to the consolidated accounts.
EBIT for 2011 also included a positive effect of NOK 112 million
associated with actuarial adjustments for a closed pension
scheme. After adjusting for non-recurring items, EBIT for 2012
was NOK 658 million while EBIT for 2011 was NOK 602 million
after adjusting for non-recurring items and the pension effect
of NOK 112 million.
Depreciation of tangible fixed assets and software developed
in-house amounted to NOK 451 million in 2012, with depreca-
tion of software developed in-house accounting for NOK 59
million. On a comparable basis, depreciation accounted for
NOK 472 million in 2011, with depreciation of software devel-
oped in-house of NOK 64 million. The reduction in deprecia-
tion is due to a lower level of investment in IT Operations in
2010 and 2011.
Depreciation of intangible assets amounted to NOK 49 million
in 2012, compared to NOK 69 million in 2011. Write-downs of
intangible assets amounted to NOK 29 million in 2011 in con-
nection with the sale of the Ukrainian subsidiary Miratech.
In 2012, NOK 86 million of costs for software developed
in-house were capitalised. Of this, NOK 76 million relates to
investments in the Solutions segment for the development of
new credit solutions, payment systems and self-service solu-
tions for Nordic banks. Other development work carried out
in the group relates to customer-specific projects where the
income derived from these projects exceeds the development
costs. Accordingly, no material costs for research and develop-
ment were recognised in 2012.
Net financial items and result for the year before and after tax
Net financial items amounted to NOK -185 million in 2012,
while profit before tax was NOK 300 million. Tax on profit for
the year in 2012 amounted to NOK 104 million, and profit for
2012 after tax was NOK 196 million.
work is continuing on
the quality improvement
and development
programs that were
initiated in 2011 and 2012
in order to ensure that
the targeted results are
achieved in relation to
deliveries to customers
and the company’s
profitability.