Itera

Earnings Release • Aug 25, 2020

The positive development continues under Covid-19

The positive development continues under Covid-19

Oslo, 25th of August 2020: Although the outbreak of Covid-19 towards the end of the first quarter caused some setbacks in those industries most impacted by it, Itera succeeded in maintaining a good level of activity. The core digital business showed a growth in gross profit of 8% and an operating margin of 12.7% (11.1%). The growth was driven by another strong increase in new customers, which were responsible for 11% of total revenue in the period.

The group's operating revenues in the digital core business accounted for 81 percent of the total turnover in the second quarter of 2020, which is at the same level as the corresponding period in 2019.

Itera reports a total operating revenue of NOK 150.8 million (NOK 143.3 million) for the second quarter of 2020, which represents growth of 5%. For the first six months revenue grew by 9% to NOK 312.7 million, with Itera’s core digital business increasing by 10% and its traditional data centre operations increasing by 6%.

Itera’s total operating expenses in the second quarter of 2020 were 4% higher at NOK 135.0 million (NOK 129.4 million), while for the first six months they were up 7% to NOK 277.6 million.

The operating result before depreciation and amortisation (EBITDA) for the second quarter of 2020 was a profit of NOK 25.8 million (NOK 22.6 million).

The operating result (EBIT) for the second quarter was a profit of NOK 15.8 million (NOK 13.9 million). The EBIT margin for the second quarter of 2020 was 10.5% (9.7%), while for the first six months it was 11.2% (9.7%).

Itera’s operating result from its core digital business was a profit of NOK 15.6 million (NOK 12.9 million), giving an EBIT margin of 12.7% (11.1%). Itera’s operating result from its traditional data centre operations was a profit of NOK 0.3 million (NOK 1.0 million), giving an EBIT margin of 1.1% (3.7%).

Net cash flow from operating activities was NOK 40.2 million (NOK 26.9 million) in the second quarter of 2020 and NOK 47.7 million (NOK 21.9 million) in the first six months.

- This quarter, I am especially proud of our customers and employees. Thanks to them, we were able to maintain a good level of activity, and also to run a full-scale summer internship programme as planned in Norway, with 31 master’s students working on five different customer projects, says Arne Mjøs, CEO of Itera.

The revenue from Itera’s 30 largest customers accounted for 76% of its operating revenue, which is almost the same level as in the second quarter of 2019. New customers accounted for 11% of revenue.

Itera’s headcount at the end of the second quarter of 2020 was 530 as compared to 499 at the end of the second quarter of 2019. The proportion of Itera’s capacity located nearshore in Slovakia and Ukraine was 48% (48%) at the end of the second quarter.

- Our delivery model has definitely made the transition to home office and digital collaboration arenas efficient and fast. With almost 50 percent of our employees located outside the Nordics, we have more than 10 years of experience with distributed teams. In fact, this is our “normal”, says Arne Mjøs.

For more information:

Arne Mjøs, CEO | arne.mjos@itera.no | +47 905 23 172

Bent Hammer, CFO | bent.hammer@itera.no | +47 982 15 497

About Itera – specialists in creating digital business

Itera is a specialist in creating digital business, with communication, technology and innovation as its core competency tools. Itera delivers projects and services in cross-functional teams to Nordic organisations that see the instrumental contribution that innovation, efficient communication, and smart utilization of technology can make to achieving their goals. Itera’s core sectors are banking and insurance, public, healthcare, the service industry, energy, and utility. Itera is headquartered in Oslo and is listed on Oslo Stock Exchange under the ticker ITE.