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Formpipe Software

Annual Report Feb 10, 2017

3159_10-k_2017-02-10_64936e22-c422-41e3-910e-abc489359931.pdf

Annual Report

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Interim report January – December 2016

PERIOD OCTOBER 1 – DECEMBER 31, 2016*

  • Net sales SEK SEK 106.7 m (SEK 93.1 m)
  • System revenue SEK 73.0 m (SEK 63.6 m)
  • Recurring revenue SEK 45.3 m (SEK 43.6 m)
  • EBITDA SEK 30.3 m (SEK 21.7 m)
  • EBITDA margin 28.4 % (23.3 %)
  • EBIT SEK 15.8 m (SEK 8.4 m)
  • Net profit SEK 11.5 m (SEK 8.2 m)
  • EPS before dilution SEK 0.22 (SEK 0.15)
  • Cash flow from operating activities SEK 46.2 m (SEK 34.2 m)

PERIOD JANUARY 1 – DECEMBER 31, 2016*

  • Net sales SEK 378.7 m (SEK 349.3 m)
  • System revenue SEK 248.6 m (SEK 236.0 m)
  • Recurring revenue SEK 178.8 M (SEK 168.4 m)
  • EBITDA SEK 88.0 m (SEK 73.7 m)
  • EBITDA margin 23.2 % (21.1 %)
  • EBIT SEK 29.7 m (SEK 19.8 m)
  • Net profit SEK 22.8 m (SEK 18.2 m)
  • EPS before dilution SEK 0.43 (SEK 0.35)
  • Cash flow from operating activities SEK 69.4 m (SEK 68.8 m)
  • The board proposes a dividend of SEK 0.30 per share (SEK 0.10)
  • * Above summary of the quarter and the full year refers to the remaining operations and thereby excluding the businesses sold in 2015, with the exception of net profit and earnings per share which relates to the entire Groups operations.

INCOME STATEMENT - SUMMARY

Oct-Dec Jan-Dec
(SEK Million) 2016 2015 2016 2015
Net sales 106,7 93,1 378,7 349,3
whereof recurring revenue 45,3 43,6 178,8 168,4
EBITDA 30,3 21,7 88,0 73,7
EBITDA-adj 21,6 9,7 50,8 28,7
EBIT - excluding items affecting comparability 15,8 8,4 32,8 21,8
EBIT 15,8 8,4 29,7 19,8

COMMENTS FROM THE GROUP CEO

2016 was a good year ending with a good fourth quarter. For the third consecutive quarter, we strengthened our margins compared to last year. For the full year, the EBITDA margin was 23.2% compared to 21.1% the previous year. An even more interesting key ratio, according to us, is EBITDA excluding capitalized development costs, i.e. the cash flow generating margin. For the full year, we are increasing it from SEK 28.6 million to 50.8 million.

We enter 2017 with a cost that is well suited to our business, we expect to continue to grow our recurring revenue without increasing our costs to the same extent. In this way, we expect our growth in recurring revenues will continue to strengthen our margins ahead.

The first license revenue related to the agreement with the City of Stockholm was recorded in the fourth quarter (SEK 4 million), at the time of the delivery approval for the basic ECM platform. The implementation project is proceeding according to plan and for the full year of 2016 we have – from the calculated degree of completion – recorded SEK 13 million in delivery revenue, of which over half was carried out by subcontractors.

We generate a strong cash flow of SEK 69.4 million from operations, allowing the Board of Directors to propose a threefold increase in the dividend to SEK 0.30 per share.

SIGNIFICANT EVENTS DURING THE PERIOD OCTOBER – DECEMBER 2016

No significant events have occurred during the period October-December.

SIGNIFICANT EVENTS AFTER THE PERIOD OCTOBER – DECEMBER 2016

AGREEMENT WITH THREE MUNICIPALITIES REGARDING LONG-TERM ARCHIVE

Formpipe signs an agreement with three municipalities regarding the e-archiving product Long-Term Archive. The total order value is SEK 6.3 million over a four-year period with a possibility of extension on an additional four years.

MARKET

Enterprise content management (ECM) is used to create, store, distribute, discover, archive and manage digital content (such as scanned documents, email, reports, medical images and office documents), and ultimately analyze usage to enable organizations to deliver relevant content to users where and when they need it. It is in the ECM market that Formpipe has emerged as the market leader in the public sector and as a challenger in e.g. Life Sciences and Legal.

Growth in the ECM market is fuelled in large part by the organizational and corporate wide need to streamline operations and meet legal requirements and regulations. Making business value from the information requires applications and services to search, analyse, process and distribute data and content. Growth drivers continually gain strength as the sheer amount of data and information increases and ECM remains a highly prioritized investment area. Gartner's forecast on ECM software revenue is a Compound Annual Growth Rate of 10.6%, 2015- 2020. The ECM market is large and fragmented, with a total addressable market (systems revenue) of 7 billion dollars in 2017 (Source: Gartner, Enterprise Software Markets, Worldwide, 2013-2020, 4Q16 update).

A CHANGING MARKET

The ECM market is changing from the centralized, backend, command and control of unstructured content to integrated, purpose-built, cloud based solutions that prioritizes content usability, processing and analysing content from one or several sources, to get business insights and business value. Control, file synchronization and sharing will be a standard capability of ECM offerings.

This change is well in line with the Formpipe's strategy, as more and more of the company's customers choose to switch to cloud solutions for the standard products, as well as with the company's development of applications and modules with the ability to process information from both Formpipe's existing systems or from other systems.

The development for ECM software is towards cloud based solutions and Gartner predicts that at least 50% of the leading ECM software providers will have rearchitected their offerings to cloud based platforms by the end of 2018. But even if the trend is towards the cloud, the license revenues from on-premises will play an important role for years to come.

Software Revenue – On Premises Vs SaaS, 2014-2020 (Källa: Gartner (Januari 2017)

THE FUTURE

Formpipe is well-positioned to be able to develop and strengthen its leading position as ECM provider while retaining good profitability levels. The company sees good opportunities to continue to utilize its experience from its successes in order to target new markets and customer segments. A solid product development and product strategy creates good conditions to be able to efficiently develop market-leading offerings and meet up with sector-specific requirements also in the future.

The board believes that Formpipe, which is one of the largest European-based ECM suppliers, is well-positioned with a stabile customer base, a high share of recurring revenue and a focus on customer segments with a high need for ECM solutions.

FINANCIAL INFORMATION

Revenues and costs for the outcome and comparison figures has been adjusted to reflect the remaining operations after the sale of the business area Customer Specific Solutions in Denmark during the fourth quarter 2015.

REVENUE

OCTOBER-DECEMBER 2016

Net sales for the period totalled to SEK 106.7 million (93.1 million), which corresponds to an increase with 15 %. System totalled to SEK 73.0 million (63.6 million). Total recurring revenue for the period increased by 4 % from the previous year and totalled to SEK 45.3 million (43.6 million), which is equivalent to 42 % of net sales. Exchange rate effects have affected net sales positively by SEK 0.5 million in comparison with the previous year.

JANUARY – DECEMBER 2016

Net sales for the period totalled to SEK 378.7 million (349.3 million), which corresponds to an increase of 8 %. System revenue increased by 5 % from the previous year and totalled to SEK 248.6 million (236.0 million). Total recurring revenue for the period increased by 6 % from the previous year and totalled to SEK 178.8 million (168.4 million), which is equivalent to 47 % of net sales. Exchange rate effects have affected net sales positively by SEK 2.0 million in comparison with the previous year.

Recurring revenue rolling 12-month, SEKm

COSTS

OCTOBER-DECEMBER 2016

The operating costs for the period increased by 7 % and totalled to SEK 90.9 million (84.7 million). Personnel costs increased by 1 % and totalled to SEK 52.2 million (51.6 million). Selling expenses totalled to SEK 14.3 million (14.0 million). Other costs totalled to SEK 18.6 million (17.8 million).

JANUARY – DECEMBER 2016

The operating costs for the period increased by 6 % and totalled to SEK 345.9 million (327.5 million). Personnel costs increased by 1 % and totalled to SEK 203.9 million (202.2 million). Selling expenses totalled to SEK 52.4 million (48.4 million). Other costs totalled to SEK 71.6 million (70.0 million). During the period costs relating to restructuring reserves have been recognised of SEK 3.1 million (1.9 million).

EARNINGS

OCTOBER-DECEMBER 2016

Operating profit before depreciation and amortization and one-off costs (EBITDA) totalled to SEK 30.3 million (21.7 million) with an EBITDA margin of 28.4 % (23.3 %). Operating profit (EBIT) totalled to SEK 15.8 million (8.4 million) with an operating margin of 14.8 % (9.0 %). Net profit from remaining operations totalled to SEK 11.5 million (4.3 million). Exchange rate effects have affected EBITDA positively by SEK 0.5 million in comparison with the previous year.

JANUARY – DECEMBER 2016

Operating profit before depreciation and amortization and one-off costs (EBITDA) totalled to SEK 88.0 million (73.7 million) with an EBITDA margin of 23.2 % (21.1 %). Operating profit (EBIT) totalled to SEK 29.7 million (19.8 million) with an operating margin of 7.8 % (5.7 %). The operating profit includes non-recurring items amounting SEK to -3.1 million (-1.9 million). Net profit from remaining operations totalled to SEK 20.4 million (9.4 million). Net profit from discontinued operations amounted to SEK 0.0 million (4.8 million). Realization gains from discontinued operations amounted to SEK 2.4 million (3.9 million) which gives a net profit for the group amounting to SEK 22.8 million (18.2 million). Exchange rate effects have affected EBITDA positively by SEK 1.3 million in comparison with the previous year.

Sales and EBITDA margin, SEKm

FINANCIAL POSITION AND LIQUIDITY

CASH EQUIVALENTS

Cash and cash equivalents at the end of the period amounted to SEK 60.9 million (37.7 million). The company had interest-bearing debt at the end of the period totalling to SEK 106.5 million (116.8) million. The company's net interest-bearing debt thereby totalled to SEK 45.6 million (79.1 million).

The company has bank overdraft facilities for a total of SEK 10.0 million and for DKK 17.0 million, which were not utilized at the end of the period (- million).

DEFERRED TAX ASSET

By the end of the period the company's deferred tax assets attributable to accumulated losses amounted to SEK 17.3 million (SEK 23.7 million).

EQUITY

Equity at the end of the period amounted to SEK 346.2 million (315.1 million), which was equivalent to SEK 6.75 (6.28) per outstanding share at the end of the period. The strengthening of the Swedish krona has increased the value of the group's net assets in foreign currencies by SEK 6.9 million (-10.2 million) from the end of the year.

During the period the personnel warrant program 2013/2016 was exercised. A total of 1 130 206 new shares were issued from this program. The number of shares and votes in the Company has therefore increased with 1 130 206. After the issue of new shares, the total number of shares and votes in the Company amounts to 51 273 608 and the share capital to SEK 5 127 360.80.

EQUITY RATIO

The equity ratio at the end of the period was 53 % (51 %).

CASH FLOW

CASH FLOW FROM OPERATING ACTIVITIES Cash flow from operating activities for the period January - December totalled to SEK 69.4 million (73.6 million), of which divested business operations SEK - million (SEK 4.8 million).

INVESTMENTS AND ACQUISITIONS

Total investments for the period January - December amounted to SEK 38.8 million (47.2 million), of which investments affecting cash flow totalled to SEK 36.1 million (43.8 million).

Investments in intangible assets totalled to SEK 37.2 million (41.8 million) and refer to capitalized product development costs.

Investments in tangible assets totalled to SEK 1.4 million (2.0 million).

During the period received payment from acquisition/divesture of business activities amounted to SEK 3.1 million (3.9 million).

FINANCING

During the period January – December the company has amortized SEK 16.1 million (22.3 million) and the interest-bearing debt amounted to SEK 106.5 million (116.8 million) at the end of the period.

As an outcome from the exercise of the personnel warrant program 2013/2016, 1 130 206 new shares was issued and payments amounting to SEK 7.5 million (- million) has been added to the Company. At the same time the Company repurchased 369 794 warrants to a value of SEK 0.5 million (- million).

During the period a new warrant program (2016/2019) has been issued to the company's personnel amounting to 500 000 warrants, which has provided the company with payments of SEK 0.3 million (0.2 million).

During the period dividends amounting to SEK 6.6 million (- million) has been paid out to shareholders.

PROPOSED APPROPRIATION OF PROFITS

DIVIDEND

The Board proposes that the AGM to be held on 25 April 2017 adopts a resolution to pay a dividend of SEK 0.30 (0.10) per share, which means a total dividend of SEK 15.4 million (5.0 million).

As the basis for its proposal for the appropriation of profits, the board, in accordance with chapter 17 § 3 subsect 2- 3 of the Swedish Companies Act, has assessed the parent company's and the group's need to strengthen the balance sheet, its liquidity and financial position otherwise, and the ability to meet its obligations in the long-term.

OTHER

EMPLOYEES

The number of employees at the end of the reporting period totalled to 230 persons (239 persons).

RISKS AND UNCERTAINTY FACTORS

The significant risk and uncertainty factors for the group and the parent company, which include business and financial risks, are described in the annual report for the last financial year. During the period there have been no changes in the risk and uncertainty factors for the group and the parent company.

TRANSACTIONS WITH RELATED PARTIES

No transactions with related parties have occurred during the period

ACCOUNTING POLICIES

The group's financial reports are prepared in accordance with International Financial Reporting Standards (IFRS) in the way in which they have been adopted by the European Union, the Swedish Annual Accounts Act, RFR 1 Additional Accounting Regulations for Groups issued by the Swedish Financial Reporting Board and in accordance with the regulations that the Stockholm Stock Exchange stipulates for companies listed on Nasdaq Stockholm. Preparing financial reports in accordance with IFRS requires that the company management makes accounting evaluations and estimates and makes assumptions that affect the application of the accounting policies and the reported values of assets, liabilities, income and costs. The actual result can differ from these estimates and evaluations. This interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. The most important accounting policies according to IFRS, which constitute the accounting standard for the preparation of this interim report, are stated in the company's most recently published annual report. During the fourth quarter of 2015 the business area Customer Specific Solutions has been sold. The business area, which earlier was included in Formpipe Groups segment Denmark, is therefore treated as a discontinued operation according to IFRS 5 and is accounted and disclosed in accordance with this accounting standard.

The financial reports of the parent company have been pre-pared in accordance with the Swedish Annual Accounts Act and RFR 2 Accounting for Legal Entities issued by the Swedish Financial Reporting Board. The same accounting policies and methods of calculation have been applied in the interim report and in the most recent annual report.

ABOUT FORMPIPE

Formpipe Software AB (publ) is a software company in the field of ECM (Enterprise Content Management). We develop and deliver ECM products for structuring information in larger companies, the public sector and organizations. Our software helps organizations to capture and place information in context. Reduced costs, minimized risk exposure and structured information are the benefits from using our ECM products.

Formpipe was founded in 2004 and has offices in Sweden, Denmark, United Kingdom, the Netherlands, Germany and USA. The Formpipe share is listed on Nasdaq Stockholm.

CALENDAR FOR FINANCIAL INFORMATION

April 24, 2017 Interim report Jan-Mar
April 25, 2017 Annual General Meeting
July 14, 2017 Interim report Jan-Jun
October 26, 2017 Interim report Jan-Sep

This interim report has not been subject to review by the company's auditors.

FINANCIAL INFORMATION

Can be ordered from the below contact details. All financial information is published on www.formpipe.com immediately after being made public.

CONTACT INFORMATION

Christian Sundin, Managing Director Telephone: +46 70 567 73 85, +46 8 555 290 84 E-mail: [email protected]

Stockholm February 10, 2017 Formpipe Software AB The Board of Directors and the Managing Director

Formpipe Software AB (publ) Swedish company reg. no.: 556668-6605 Sveavägen 168 | Box 231 31 | 104 35 Stockholm T: +46 8 555 290 60 | F: +46 8 555 290 99 [email protected] | www.formpipe.se

CONSOLIDATED INCOME STATEMENT SUMMARY

(SEK 000)
2016
2015
2016
2015
Net Sales
106 696
93 123
378 723
349 292
Sales expenses
-14 287
-14 033
-52 439
-48 406
Other costs
-18 621
-17 757
-71 588
-70 044
Personnel costs
-52 220
-51 607
-203 856
-202 173
Capitalized work for own account
8 718
11 957
37 204
45 002
Operating profit/loss before depreciation/amortization
30 286
21 683
88 044
73 670
and non-comparative items (EBITDA)
Items affecting comparability
-
-
-3 118
-1 947
Depreciation/amortization
-14 460
-13 308
-55 261
-51 880
Operating profit/loss (EBIT)
15 826
8 375
29 665
19 843
Financial income and expenses
-1 144
-1 023
-4 661
-5 212
Exchange rate differences
311
412
2 519
-899
Tax
-3 517
-3 479
-7 173
-4 296
Net profit for the period from remaining business
11 477
4 284
20 350
9 436
Profit/loss attributable to discontinued business
-
-32
-
4 838
Realization gains from discontinued business
-
3 905
2 434
3 905
Net profit for the period
11 477
8 157
22 784
18 179
Of which the following relates to:
Parent company shareholders
11 457
7 679
21 877
17 490
Shareholding with no controlling influence
19
478
907
689
Other comprehensive income
Translation differences
-1 288
-8 373
6 941
-10 216
Other comprehensive income for the period, net after tax
-1 288
-8 373
6 941
-10 216
Total comprehensive income for the period
10 188
-215
29 725
7 964
Of which the following relates to:
Parent company shareholders
10 169
-694
28 818
7 275
Shareholding with no controlling influence
19
478
907
689
EBITDA margin, %
28,4%
23,3%
23,2%
21,1%
EBIT margin, %
14,8%
9,0%
7,8%
5,7%
Profit margin, %
10,8%
8,8%
6,0%
5,2%
Earnings per share attributable to the parent company's shareholders dur
ing the period (SEK per share)
- before dilution
0,22
0,15
0,43
0,35
- after dilution
0,22
0,15
0,43
0,35
- before dilution, remaining business
0,22
0,08
0,38
0,17
- after dilution, remaining business
0,22
0,08
0,38
0,17
- before dilution, discontinued business
-
0,08
0
0,17
- after dilution, discontinued business
-
0,08
0
0,17
Average no. of shares before dilution, in 000
51 274
50 143
50 803
50 143
Average no. of shares after dilution, in 000
51 566
50 637
51 203
50 592
Oct-Dec Jan-Dec

CONSOLIDATED BALANCE SHEET SUMMARY

Dec 31 Dec 31
(SEK 000) 2016 2015 2015
Intangible assets 470 396 473 393 473 393
Tangible assets 4 075 3 898 3 898
Financial assets 1 682 1 425 1 425
Deferred tax asset 17 332 23 680 23 680
Current assets (excl. cash equivalents) 94 870 77 723 77 723
Cash equivalents 60 890 37 670 37 670
TOTAL ASSETS 649 244 617 789 617 789
Equity 346 249 315 108 315 108
Shareholding with no controlling influence 2 706 3 378 3 378
Long-term liabilities 115 953 132 260 132 260
Current liabilities 184 337 167 043 167 043
TOTAL EQUITY AND LIABILITIES 649 244 617 789 617 789
Net interest-bearing debt (-) / cash (+) -45 626 -79 081 -79 081

CHANGES IN CONSOLIDATED EQUITY

Equity attributable to the parent company's shareholders Share-
Other Profit/loss holdings with
Share contributed Translation brought no controlling
(SEK 000) capital capital reserves forward Total influence Total
Balance at January 1, 2015 5 014 186 464 14 670 101 440 307 588 2 689 310 277
Comprehensive income
Net profit for the period - - - 17 490 17 490 689 18 179
Other comprehensive income items - - -10 216 - -10 216 - -10 216
Total comprehensive income - - -10 216 17 490 7 275 689 7 963
Transaction with owners
Employee warrant schemes - 245 - - 245 - 245
Total transaction with owners - 245 - - 245 - 245
Balance at December 31, 2015 5 014 186 709 4 454 118 930 315 108 3 378 318 486
Balance at January 1, 2016 5 014 186 709 4 454 118 930 315 108 3 378 318 486
Comprehensive income
Net profit for the period - - - 21 877 21 877 907 22 784
Other comprehensive income items - - 6 941 - 6 941 - 6 941
Total comprehensive income - - 6 941 21 877 28 818 907 29 725
Transaction with owners

Dividend - - - -5 014 -5 014 -1 579 -6 594 Share issue 113 7 425 - - 7 538 - 7 538 Repurchase of warrants - -466 - - -466 - -466 Employee warrant schemes - 265 - - 265 - 265 Total transaction with owners 113 7 224 - -5 014 2 323 -1 579 744 Balance at December 31, 2016 5 127 193 933 11 395 135 793 346 249 2 706 348 954

CASH FLOW STATEMENT SUMMARY

Oct-Dec Jan-Dec
(SEK 000) 2016 2015 2016 2015
Cash flow from operating activities
before working capital changes 27 516 17 027 73 341 61 328
Cash flow from working capital changes 18 681 17 212 -3 913 7 440
Cash flow from remaining operating activities 46 197 34 239 69 428 68 768
Cash flow from discontinued business - -32 - 4 838
Cash flow from operating activities 46 197 34 207 69 428 73 606
Cash flow from investing activities -8 740 -7 920 -32 975 -39 881
Of which acquisition/divesture of business activities - 3 905 3 121 3 905
Cash flow from financing activities -3 788 -4 102 -12 853 -22 033
Of which dividend paid - - -6 593 -
Cash flow for the period 33 669 22 185 23 600 11 692
Change in cash and cash equivalent
Cash and cash equivalent at the beginning of the period 27 192 15 619 37 670 26 035
Translation differences 30 -134 -380 -57
Cash flow for the period 33 669 22 185 23 600 11 692
Cash and cash equivalent at the end of the period 60 890 37 670 60 890 37 670

8 QUARTERS IN SUMMARY*

(SEK 000) 2015 Q1 2015 Q2 2015 Q3 2015 Q4 2016 Q1 2016 Q2 2016 Q3 2016 Q4
Support and maintenance 39 511 38 058 39 254 40 893 42 150 40 842 42 478 42 309
Licenses 17 617 20 884 17 025 22 708 15 999 20 459 13 730 30 667
System revenue 57 128 58 942 56 279 63 602 58 149 61 301 56 208 72 976
whereof recurring revenue 41 899 40 826 42 076 43 603 44 806 43 308 45 338 45 318
Deliveries 27 163 29 388 27 235 29 522 29 126 40 230 27 013 33 720
Net sales 84 291 88 329 83 514 93 123 87 275 101 531 83 221 106 696
Sales expenses -10 062 -11 925 -12 381 -14 033 -12 886 -13 939 -11 327 -14 287
Other costs -16 645 -18 746 -18 912 -17 757 -17 399 -18 724 -16 844 -18 621
Personnel costs -49 722 -52 736 -46 077 -51 607 -51 099 -56 277 -44 260 -52 220
Capitalized development costs 10 696 10 901 11 448 11 957 10 524 8 887 9 074 8 718
Total operating expenses -65 733 -72 506 -65 922 -71 440 -70 861 -80 053 -63 356 -76 410
EBITDA 18 558 15 823 17 592 21 683 16 415 21 478 19 865 30 286
% 22,0% 17,9% 21,1% 23,3% 18,8% 21,2% 23,9% 28,4%
Items affecting comparability - - -1 947 - - -3 118 - 0
Depreciation/amortization -12 708 -12 834 -13 030 -13 308 -13 584 -13 559 -13 658 -14 460
EBIT 5 850 2 989 2 614 8 375 2 831 4 801 6 207 15 827
% 6,9% 3,4% 3,1% 9,0% 3,2% 4,7% 7,5% 14,8%
Discontinued business: 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0%
Net sales 9 692 7 493 4 627 2 165 - - -
EBITDA 4 102 2 844 1 683 -43 - - -

* Adjusted to reflect the remaining business after disposal of customer specific consulting services in Denmark in 2015 Q4.

SEGMENT SUMMARY

In order to visualize the effects from the disposal of the customer specific consulting services in Denmark December 11, 2015, the direct revenues and costs attributable to this business have been recorded separately. The business was previously a part of the segment Denmark.

As per December 31, 2015, the ownership of Formpipe Intelligo AB was transferred from Formpipe Software A/S to the parent company Formpipe Software AB and thereby also shifted from segment Denmark to segment Sweden. The comparable numbers below have been adjusted accordingly. The adjustment concern internal sales of 5 344 TSEK and external costs of 1 898 TSEK that has been moved from segment Denmark to segment Sweden.

Jan-Dec 2016
Life Remaining Discontinued
(SEK 000) Sweden Denmark Science Eliminations business business Group
Sales, external 157 572 211 103 10 048 - 378 723 - 378 723
Sales, internal 7 030 2 009 1 401 -10 440 - - -
Total sales 164 602 213 112 11 449 -10 440 378 723 378 723
Costs, external -109 147 -166 030 -15 502 - -290 679 - -290 679
Costs, internal -6 182 -2 857 -1 401 10 440 - - -
EBITDA 49 273 44 225 -5 454 - 88 044 - 88 044
% 29,9% 20,8% -47,6% 0,0% 23,2% - 23,2%
Jan-Dec 2015
Life Remaining Discontinued
(SEK 000) Sweden Denmark Science Eliminations business business Group
Sales, external 138 419 195 040 15 833 - 349 292 23 942 373 234
Sales, internal 6 506 1 576 700 -8 782 - -
Total sales 144 925 196 616 16 533 -8 782 349 292 23 942 373 234
Costs, external -92 263 -160 755 -22 604 - -275 622 -15 371 -290 993
Costs, internal -5 831 -2 251 -700 8 782 - - -
EBITDA 46 831 33 610 -6 771 - 73 670 8 571 82 241
% 32,3% 17,1% -41,0% 0,0% 21,1% 35,8% 22,0%

NUMBER OF SHARES

2012-01-01 2013-01-01 2014-01-01 2015-01-01 2016-01-01
2012-12-31 2013-12-31 2014-12-31 2015-12-31 2016-12-31
Number of outstanding shares at the beginning
of the period
12 233 647 48 934 588 48 934 588 50 143 402 50 143 402
Share issue 36 700 941 - - - 1 130 206
Non-cash issue - - 1 208 814 - -
Number of outstanding shares at the end of
the period
48 934 588 48 934 588 50 143 402 50 143 402 51 273 608

SALES ANALYSIS BY QUARTER

KEY RATIOS FOR THE GROUP

Jan-Dec
2016 2015
Net sales, SEK 000 378 723 349 292
EBITDA, SEK 000 88 044 73 670
EBIT, SEK 000 29 665 19 843
EBITDA-adj, SEK 000 50 840 28 668
Net profit for the period, SEK 000 22 784 18 179
EBITDA margin, % 23,2% 21,1%
EBITDA-adj margin, % 13,4% 8,2%
EBIT margin, % 7,8% 5,7%
Profit margin, % 6,0% 5,2%
Return on equity, %* 6,6% 5,6%
Return on working capital, %* 7,5% 4,8%
Equity ratio, % 53% 51%
Equity per outstanding share at the end of the period, SEK 6,75 6,28
Earnings per share - before dilution, SEK 0,43 0,35
Earnings per share - after dilution, SEK 0,43 0,35
Share price at the end of the period, SEK 9,75 8,50

* Ratios including P&L measures are based on the most recent 12-month period

PARENT COMPANY INCOME STATEMENT SUMMARY*

Oct-Dec Jan-Dec
(SEK 000) 2016 2015 2016 2015
Net sales 44 521 15 146 139 446 40 701
Operating expenses
Sales expenses -4 991 -549 -17 780 -2 308
Other costs -7 761 -3 550 -28 229 -11 508
Personnel costs -17 020 -10 130 -65 265 -35 684
Depreciation/amortization -1 590 -455 -6 298 -1 822
Total operating expenses -31 362 -14 685 -117 573 -51 323
Operating profit/loss 13 159 461 21 873 -10 622
Result from participations in group companies - 21 850 2 921 21 850
Other financial items 305 909 4 415 774
Net profit for the period 7 752 20 415 23 496 9 197

* During 2016 the fully owned Swedish subsidiaries were merged with the parent company. The merger has had no effect on the group consolidated figures.

PARENT COMPANY BALANCE SHEET SUMMARY

Dec 31 Dec 31
(SEK 000) 2016 2015 2015
Intangible assets 19 856 3 432 3 432
Tangible assets 1 164 1 022 1 022
Financial assets 353 463 426 923 426 923
Deferred tax asset - 3 635 3 635
Current assets (excl. cash equivalents) 65 302 34 125 34 125
Cash and bank balances 45 369 41 165 41 165
TOTAL ASSETS 485 154 510 303 510 303
Restricted equity 22 818 22 705 22 705
Non-restricted equity 210 064 213 507 213 507
Total equity 232 882 236 212 236 212
Long-term liabilities 94 552 107 036 107 036
Current liabilities 157 720 167 054 167 054
TOTAL EQUITY AND LIABILITIES 485 154 510 303 510 303

* During 2016 the fully owned Swedish subsidiaries were merged with the parent company with a merger difference in the equity of the parent company. The merger has had no effect on the group consolidated figures.

PLEDGED ASSETS AND CONTINGENT LIABILITIES

Pledged assets refers to shares in subsidiaries as security for loans. The pledged assets in the Group is the same as disclosed for the Parent Company.

Dec 31 Dec 31
Pledged assets (SEK 000) 2016 2015 2015
Pledged assets 300 321 369 869 334 131
Contingent liabilities - - -

DEFINITIONS

Formpipe uses alternative key figures, also called APM (Alternative Performance Measures). From July 3rd 2016 new guidelines were implemented by the European Union regarding alternative APM's, which Formpipe uses in published reports. Formpipe's APM's is calculated from the financial reports, which are prepared in accordance with applicable rules for financial reporting, where prepared figures is altered by adding or subtracting amounts from the presented numbers. Below the alternative performance measures, that Formpipe uses in published reports, are defined and described

SYSTEM REVENUE

The total of license revenue and revenue from support and maintenance contracts.

RECURRING REVENUE

Revenue of an annually recurring nature such as support and maintenance revenue and revenue from SAAS services regarding license agreements.

FIXED OPERATING EXPENSES

Other costs and personnel costs

EBITDA

Earnings before depreciation, amortization, acquisitionrelated costs and other items of a one-off nature.

EBITDA-ADJ

EBITDA exclusive capitalized work for own account

ITEMS AFFECTING COMPARABILITY

The item must be of a material nature to be reported separately and considered undesirable from the regular core operations and complicate the comparison. For example, acquisition-related items, restructuring-related items and write-downs

EBIT

Operating profit/loss

OPERATING MARGIN BEFORE DEPRECIATION AND AMORTIZATION (EBITDA MARGIN )

Earnings before depreciation, amortization, acquisitionrelated costs and other items of a one-off nature as a percentage of net sales.

OPERATING MARGIN BEFORE DEPRECIATION AND AMORTIZATION (EBITDA-ADJ MARGIN ) Earnings before capitalized work for own account, depre-

ciation, amortization, acquisition-related costs and other items of a one-off nature as a percentage of net sales.

OPERATING MARGIN (EBIT MARGIN ) Operating profit/loss as a percentage of net sales.

PROFIT MARGIN

Net profit/loss after tax as a percentage of sales at the end of the period.

EARNINGS PER SHARE - BEFORE DILUTION Net profit/loss after tax divided by the average number of shares during the period.

EARNINGS PER SHARE - AFTER DILUTION

Net proft/loss after tax adjusted for dilution effects divided by the average number of shares after dilution during the period.

EQUITY PER SHARE

Equity at the end of the period divided by the number of shares at the end of the period.

RETURN ON EQUITY

Profit/loss after tax as a percentage of average equity

RETURN ON WORKING CAPITAL

Operating profit/loss as a percentage of average working capital (balance sheet total less non-interest bearing liabilities and cash and bank balances).

FREE CASH FLOW

Cash flow from operating activities minus cash flow from investing activities excluding acquisitions.

NET INTEREST-BEARING DEBT

Interest bearing debts minus cash and cash equivalents

EQUITY RATIO

Equity as a percentage of the balance sheet total.

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