Itera

Earnings Release • Apr 26, 2019

Strong demand for cloud solutions

Strong demand for cloud solutions

Oslo, 26th April 2019: First-quarter operating revenue from Itera’s core digital business was up 10% compared with the same period last year, and the order intake was very strong.

Itera reports operating revenue of NOK 142.8.million (NOK 131.2 million) for the first quarter of 2019, which represents growth of 9%. This growth was predominantly from Itera’s core digital business, the revenue from which increased to NOK 107.1 million from NOK 97.4 million (+10%), while the revenue generated by Itera’s traditional data centre operations increased by 6% from NOK 33.7 million to NOK 35.7 million.

Itera’s total operating expenses in the first quarter of 2019 were 6% higher at NOK 128.9 million (NOK 121.1 million).

The operating result before depreciation and amortisation (EBITDA) for the first quarter of 2019 was a profit of NOK 22.3 million (NOK 15.2 million), while the operating result (EBIT) was a profit of NOK 13.8 million (NOK 10.0 million). The EBIT margin for the first quarter of 2019 was 9.7% as compared to 7.6% in the first quarter of 2018.

Net cash flow from operating activities was NOK -8.5 million (NOK -8.2 million) in the first quarter of 2019. As in the first quarter of 2018, the collection of customer receivables was negatively impacted by a significant number of invoices falling due on the last weekend of March.

- As in previous quarters, we again saw a rapid shift toward using cloud-based solutions in the first quarter. A major change is that the cloud has become more secure than on-premises solutions. Security is becoming a key driver for moving to cloud, in addition to the new capabilities it offers in relation to services and products for digital businesses. Many new applications are built as native cloud solutions and many companies are also working on further developing their existing solutions and IT infrastructure by moving to the cloud. In general, we can see that almost all our customers are planning to start using or to increase their use of cloud services in 2019, says Arne Mjøs CEO of Itera.

The revenue from Itera’s 30 largest customers grew by 5% in the first quarter of 2019 and accounted for 77% of its operating revenue, down from 80% in the first quarter of 2018.

Itera’s headcount at the end of the first quarter of 2019 was 488 as compared to 489 at the end of the first quarter of 2018.

The proportion of Itera’s capacity that is located nearshore (its nearshore ratio) was 45% (44%) at the end of the first quarter. Itera has development centres in Slovakia and Ukraine and is approaching its long-term strategic target of achieving a nearshore ratio of more than 50%.

Further information:

Arne Mjøs, CEO Bent Hammer, CFO

+47 905 23 172 +47 982 15 497

arne.mjos@itera.no bent.hammer@itera.no

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.