Page 57 - EVRY Annual Report 2012

From the Boardroom 57
Operating profit before amortisation and write-down of
intangible assets (EBITA) was NOK 279 million in 2012,
equivalent to an EBITA margin of 4.8%. By comparison, the
EBITA margin in 2011 was 5.4%.
The IT Operations segment’s order backlog was NOK 9.5 bil-
lion at 31 December 2012, representing a reduction of NOK
1.0 billion from the end of the end of 2011. Of the order back-
log at 31 December 2012, NOK 4.5 billion is due for delivery
in 2013.
The company does not expect any improvement in EBITA
from IT Operations in 2013 relative to 2012. This relates to the
downward trend for revenue in Enterprise & Public Norway
(excluding bank and finance customers), as well as costs
in respect of essential network upgrades in order to ensure
better quality, and the costs of the Future Proof program.
The Future Proof program will strengthen the profitability of
IT Operations and improve quality. The main features of this
program are industrialisation through automation, standard-
isation and data centre consolidation, as well as greater use
of offshoring and new forms of service delivery. In addition,
the segment has increased its sales and market focus. The in-
troduction of a new and streamlined organisational structure
with effect from 2013 will play an important role in achieving
greater profitability for IT Operations.
The Solutions segment
The Solutions segment is a market leader with a complete
suite of solutions for the Nordic banking and finance sector.
The segment also offers a broad range of software solutions
and consulting services to both private and public customers,
mainly in Norway and Sweden. Solutions Norway provides
ERP systems, case management and document processing
systems and voting systems for the public sector. In addition,
Solutions offers application services and information systems
for all types of business. In Sweden, ERP and mobility solu-
tions are provided for a number of business sectors, as well as
niche solutions for municipalities, the healthcare sector and
the forestry industry. The segment also includes the group’s
Global Sourcing units located in Ukraine and India.
The Solutions segment reported operating revenue of NOK
4,404 million in 2012, equivalent to organic growth of 4%
relative to 2011. Both the bank and finance industry vertical
and the public sector vertical reported good growth in 2012.
Global Sourcing activities accounted for 10% of the segment’s
revenues in 2012, with sound organic growth. Deliveries from
operations centres in India and Ukraine to the group’s Nordic
organisation account for some 35% of total revenues for
EVRY’s Global Sourcing businesses. The remaining revenues
relate to other customers, which ensures that the operations
centres in India and Ukraine have a profitable and scalable
business model.
The Board of EVRY ASA has decided that the company’s
DigOff solution will not be sold to additional customers, but
that the company will continue to carry out the existing con-
tracts for this solution. This decision was based on an overall
evaluation of both risk and market prospects associated with
additional sales of this solution. Following the decision on
DigOff, EVRY will now focus on the Agresso Business World
solution. EVRY continues to be fully committed to offering
the market’s best solutions portfolio and leading specialist
environment for this type of solution for the public sector.
In order to strengthen further the Solutions segment, the
company has decided to concentrate its focus on Nordic
banking and finance customers into a separate industry ver-
tical that will have complete responsibility for this market. In
addition, the company will continue to build other industry
verticals in Norway and Sweden that are positioned at the
higher stages of the value chain in areas where the company
can benefit from its unique position in the Nordic countries.
Operating profit before amortisation and write-downs
of intangible assets (EBITA) was NOK 392 million in 2012,
representing an EBITA margin of 8.9%. EBITA for 2011 was
NOK 349 million, of which sales of solutions in connection
with the Norwegian elections had a positive effect on EBITA
of NOK 38 million.
At the end of 2012, there were 2,139 employees in the Nordic
units of Solutions and 2,440 employees in the Global Sourcing
companies in India and Ukraine. Comparable figures at the
end of 2011 were 2,108 and 2,011 employees, respectively.
The Solutions segment reported an order backlog of NOK 4.7
billion at 31 December 2012, of which NOK 2.0 billion is due
for delivery in 2013. The Board expects the growth prospects
for the Solutions segment to remain favourable in both the
The group’s total
market share of
the Nordic market
is estimated to
be 9.5%, with a
32.8% market share
in Norway and
7.6% share of the
Swedish market.