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Enento Group Oyj Interim / Quarterly Report 2021
3262_rns_2021-10-29_ce027b17-e8ab-49aa-943c-244c27be4cb5.pdf
Interim / Quarterly Report
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ENENTO GROUP PLC
INTERIM REPORT
1.1.–30.9.2021
Enento
Building trust in the everyday.
Enento Group's Interim Report 1.1. – 30.9.2021
1 (30)
ENENTO GROUP PLC, STOCK EXCHANGE RELEASE 29 OCTOBER 2021 AT 12.00 EEST
Enento Group’s Interim Report 1.1. – 30.9.2021: Quarter with moderate growth after Covid-19 spurt
SUMMARY
July - September 2021 in brief
- Net sales amounted to EUR 38,6 million (EUR 36,7 million), an increase of 5,2 % (at comparable exchange rates an increase of 4,0%).
- Adjusted EBITDA excluding items affecting comparability was EUR 14,5 million (EUR 14,8 million), a decrease of 2,2 % (at comparable exchange rates an decrease of 3,1 %).
- Adjusted EBIT excluding items affecting comparability and amortisation from fair value adjustments related to acquisitions was EUR 11,9 million (EUR 12,4 million), a decrease of 3,6 %.
- Operating profit (EBIT) was EUR 8,9 million (EUR 9,2 million). Operating profit included items affecting comparability of EUR 3,0 million (EUR 3,2 million), mainly arising from amortisation from fair value adjustments of EUR 3,1 million (EUR 3,1 million) related to acquisitions as well as M&A related expense adjustment.
- New services represented 7,6 % (6,3 %) of net sales.
- Free cash flow amounted to EUR 9,9 million (EUR 11,0 million). The effect of items affecting comparability on free cash flow was EUR -0,0 million (EUR -0,6 million).
- Earnings per share was EUR 0,27 (EUR 0,28).
- Comparable earnings per share were EUR 0,37 (EUR 0,38)¹.
January – September 2021 in brief
- Net sales amounted to EUR 120,4 million (EUR 111,1 million), an increase of 8,4 % (at comparable exchange rates an increase of 5,9 %).
- Adjusted EBITDA excluding items affecting comparability was EUR 44,5 million (EUR 39,7 million), an increase of 12,2 % (at comparable exchange rates an increase of 10,2 %).
- Adjusted EBIT excluding items affecting comparability and amortisation from fair value adjustments related to acquisitions was EUR 36,9 million (EUR 33,0 million), an increase of 11,8 %.
- Operating profit (EBIT) was EUR 27,5 million (EUR 21,7 million). Operating profit included items affecting comparability of EUR 9,4 million (EUR 11,3 million), mainly arising from amortisation from fair value adjustments of EUR 9,5 million (EUR 9,1 million) related to acquisitions as well as M&A related expenses, reversal of excess redundancy provisions and received insurance compensation.
- New services represented 7,3 % (5,2 %) of net sales.
- Free cash flow amounted to EUR 19,8 million (EUR 23,5 million). The effect of items affecting comparability on free cash flow was EUR -0,3 million (EUR -2,0 million).
- Earnings per share was EUR 0,85 (EUR 0,66).
- Comparable earnings per share were EUR 1,17 (EUR 0,96)¹.
¹ The comparable earnings per share does not contain amortisation from fair value adjustments related to acquisitions or their tax impact.
Enento Group's Interim Report 1.1. – 30.9.2021
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| KEY FIGURES | |||||
|---|---|---|---|---|---|
| EUR million | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Net sales | 38,6 | 36,7 | 120,4 | 111,1 | 151,3 |
| Net sales growth, % | 5,2 | 0,1 | 8,4 | 4,1 | 3,7 |
| Operating profit (EBIT) | 8,9 | 9,2 | 27,5 | 21,7 | 27,8 |
| EBIT margin, % | 23,0 | 25,1 | 22,8 | 19,6 | 18,4 |
| Adjusted EBITDA | 14,5 | 14,8 | 44,5 | 39,7 | 54,0 |
| Adjusted EBITDA margin, % | 37,5 | 40,3 | 37,0 | 35,7 | 35,7 |
| Adjusted operating profit (EBIT) | 11,9 | 12,4 | 36,9 | 33,0 | 45,0 |
| Adjusted EBIT margin, % | 30,9 | 33,7 | 30,7 | 29,7 | 29,7 |
| New services of net sales, % | 7,6 | 6,3 | 7,3 | 5,2 | 5,6 |
| Free cash flow | 9,9 | 11,0 | 19,8 | 23,5 | 32,6 |
| Net debt to adjusted EBITDA, x | 2,6 | 2,4 | 2,6 | 2,7 | 2,6 |
Net sales, EUR million
- Net sales growth in the third quarter was 5,2 % at reported exchange rates and 4,0 % at comparable exchange rates compared with the corresponding quarter of the previous year.
- Consumer Insight -business area grew moderately. Consumer information services begun to recover in the Finnish market but in the Swedish market the growth in demand for Consumer services slowed down.
- Business Insight -business area net sales grew especially due to Freemium services as advertising market recovered but Enterprise services for large customers remained on prior year level.
- Digital Processes -business area grew due to high demand for real estate information services and digital housing transaction services, however the record high comparables moderated the growth rate.
- Successful service development investments supported the development of net sales in all business areas.
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Adjusted EBITDA, EUR million
- The decrease of adjusted EBITDA in the third quarter was 2,2 % at reported exchange rates and 3,1 % at comparable exchange rates compared with the corresponding quarter of the previous year.
- Negative adjusted EBITDA development is mainly caused by expensed investments made to support future growth. Comparison period cost levels were exceptionally low due to cost saving measures taken in the prior year. The future growth investments together with third quarter relatively modest net sales development had an impact on profitability.
- Adjusted EBITDA margin was 37,5 % (40,3 %).
Adjusted operating profit (EBIT), EUR million
- Compared with the reference period, adjusted operating profit (EBIT) for the third quarter decreased by 3,6 % at reported exchange rates and 4,5 % at comparable exchange rates. Decrease was in line with adjusted EBITDA development.
- Depreciations related to capitalised development costs increased from the comparison period by EUR 0,1 million.
- Adjusted EBIT margin was 30,9 % (33,7 %).
New services' share of net sales, %
- New services accounted for 7,6 % of net sales in the third quarter.
- The Group has remained active in investing in the service development in spite of the impacts of the coronavirus pandemic, and the investments are focused on the priorities outlined in the strategy.
- A total of 6 new services were launched in the third quarter.
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Free cash flow, EUR million
- Operating cash flow before change in working capital was on comparison period level. Impact of change in net working capital on cash flow was slightly positive mainly due to decrease in accounts receivable.
- Free cash flow decreased compared to prior year due to high service development investments in new services, service platform and IT environment consolidation.
- Items affecting comparability affected cash flow from operating activities in the third quarter by EUR 0,0 million (EUR 0,6 million).
FUTURE OUTLOOK
Net Sales: Enento Group expects its net sales growth in 2021 to be in the long-term target range (5-10%), exceeding the mid-point of that range.
EBITDA: Enento Group expects its adjusted EBITDA margin to improve somewhat in 2021 compared to previous year.
Capital Expenditure: Enento Group expects its capitalised product development and software expenses in 2021 to exceed the previous year's level.
The Outlook assumes that exchange rates remain approximately on the same level as in the first half of 2021.
JUKKA RUUSKA, CEO
The global economy continues its post-pandemic recovery, but the growth outlook has been dampened during early autumn. The Delta variant that brought uncertainty to the markets in August has been accompanied by supply chain problems, higher inflation figures and rising energy prices. The supply chain problems have restricted the growth outlook. The pandemic continues to perpetuate uncertainty in the economy and in the markets, which may be reflected in increased credit losses.
The third quarter in 2021 was a quarter of low growth for Enento Group. The Group's net sales amounted to EUR 38,6 million, representing a year-on-year increase of 5,2% (at comparable exchange rates 4,0%). Adjusted EBITDA decreased by 2,2% (at comparable exchange rates 3,1%) and amounted to EUR 14,5 million. The Group's adjusted operating profit excluding items affecting comparability declined by 3,6% (at comparable exchange rates 4,5%) and amounted to EUR 11,9 million. Continuous and innovative service development and new services are an important source of growth. The new service development portfolio remains strong and its share of net sales is now at 7,6% and growing.
Net sales grew in all our three business areas in the third quarter, but the growth rate was much more moderate than in the previous quarter. Consumer information services in the Finnish market began to recover during the period under review and their volume is expected to grow going forward, but the growth of demand for consumer services slowed down in Sweden. Business in the Norwegian market has grown throughout 2021 and continued strong growth was seen in the third quarter. The growth rate of real estate and collateral information services in the Digital Processes business area levelled off. In 2020, the growth in the housing market started accelerating in the third quarter, which is the primary
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reason behind the record-high net sales in the comparison period. Growth in the Business Insight business area was moderate.
Understanding the customer needs is the strategic key to success in service development and our determined work resulted in significant customer wins in the third quarter. Regulatory reforms and the increasing significance of risk management require the company to adapt, anticipate and understand changes and develop risk management effectively. The increased regulatory requirements for sufficient credit assessments in Sweden have led to higher demand for our risk management services and has significantly increased the use of our expanded credit information reports. In addition, many of our customers have added student loan information to the credit information reports they order. In Finland, one of our significant customers is digitalising their contract processes by taking advantage of our service that allows them to confirm the counterparty's right to sign for the corporation they represent. Another significant customer started using our postal-code-based housing price index service to monitor and update their housing insurance portfolio.
We can look back on a tremendous ten-year journey that we have with determination travelled together with the whole personnel. Developing the Finnish company Asiakastieto into the Nordic Enento Group has been a wonderful opportunity. For my part, this is the right time to pass the baton to Jeanette Jäger, my Swedish successor, who will start as the Group's new CEO on 1 January 2022. I want to thank all of our customers, employees, shareholders and partners for their trust, genuine dialogue and excellent cooperation. We are in a great position to move forward.
NET SALES
July - September
Enento Group's net sales in the third quarter amounted to EUR 38,6 million (EUR 36,7 million), representing a year-on-year increase of 5,2 % at reported exchange rates and 4,0 % at comparable exchange rates. Net sales from new services came to EUR 2,9 million (EUR 2,3 million), representing 7,6 % (6,3 %) of the total net sales for the third quarter. The development of net sales continued in all business areas, but the growth rate was significantly more moderate than in the previous review period. Growth was supported particularly by the recovery of the demand for the Consumer Insight business area's consumer information services in Finland, the growth of the Digital Processes business area driven by positive market volume and the value added service offering as well as the continued positive market demand for freemium services in the Business Insight business area. New services supported the development of net sales in each business area and the share of net sales represented by new services continued to see strong growth as planned. The number of banking days with a volume effect was the same as last year in both of the main market areas, Finland and Sweden.
The net sales of the Business Insight business area amounted to EUR 17,9 million (EUR 17,1 million) in the third quarter. Compared with the corresponding quarter in the previous year, the net sales of the business area increased by 4,8 % at reported exchange rates and 3,8 % at comparable exchange rates. Net sales from premium services for SMEs developed strongly especially in Norway, where success was driven by successful sales efforts. Enterprise services aimed at large customers remained on prior year level due to the low demand for risk management services. Net sales from freemium services increased in Sweden and Norway as the advertising market saw a substantial recovery compared to the corresponding quarter in the previous year.
The net sales of the Consumer Insight business area amounted to EUR 17,5 million (EUR 16,7 million) in the third quarter. Compared with the corresponding quarter in the previous year, the net sales of the business area increased by 4,7 % at reported exchange rates and 3,4 % at comparable exchange rates. The development of the demand for consumer information and decision-making services in Sweden was moderate in the third quarter. In Finland, the market demand for consumer information services developed favourably in spite of the temporary interest rate cap regulations remaining in effect. The net sales performance of consumer information services focused on sales and marketing remained very strong in Finland thanks to successful sales efforts and new services. The sales of consumer services also continued to develop well in the third quarter. The net sales in consumer services is mainly coming from subscription-based services. Consumer services in Sweden have already achieved a considerable market position and there is still significant potential for further growth. The experience and competencies built in the Swedish market have been put to use in developing the range of consumer
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services in Finland. The active service development of online consumer services continues and the future growth of the services is expected to be supported by new service features as well as productive marketing investments.
The net sales of the Digital Processes business area amounted to EUR 3,2 million (EUR 2,9 million) in the third quarter. Compared with the corresponding quarter in the previous year, the net sales of the business area increased by 9,9% at reported exchange rates and 9,1% at comparable exchange rates. In the housing market, the demand for digital services continued in the Swedish market in the third quarter, but the net sales growth of the Tambur digital housing transaction service slowed down. The growth in the housing market started accelerating in the 2020 third quarter, which is the primary reason behind the record-high net sales in the comparison period. The business area has a strong focus on the development of digital services related to housing and collateral management that improve the customer experience and increase process efficiency. In Sweden, investments in the further development of the Tambur housing transaction service are continuing in close cooperation with key customers.
January – September
Enento Group's net sales in the review period amounted to EUR 120,4 million (EUR 111,1 million), an increase of 8,4% year-on-year at reported exchange rates and 5,9% at comparable exchange rates. Net sales from new services were EUR 8,8 million (EUR 5,8 million), corresponding to 7,3% (5,2%) of the total net sales for the review period. The key drivers of net sales growth during the period under review included the recovery of Swedish market demand in the Consumer Insight business area in the second quarter, the continued strong growth of the Digital Processes business area – particularly in Sweden – and the positive development of premium services for SMEs in the Business Insight business area. The share of net sales represented by new services saw strong development during the period under review, with new services playing a significant role in driving growth during the period. The number of banking days with a volume effect was the same as last year in both of the main market areas, Finland and Sweden.
The net sales of the Business Insight business area in the review period amounted to EUR 57,4 million (EUR 54,2 million). Compared with the corresponding period in the previous year, the net sales of the business area increased by 6,0% at reported exchange rates and 3,9% at comparable exchange rates. The key drivers of the business area's net sales growth during the review period were premium services aimed at SMEs and freemium services focused on company visibility. The development of net sales was particularly strong in Norway, where premium services have seen significant growth thanks to successful sales efforts. The net sales of freemium services developed well as the corporate advertising and visibility market recovered. The development of the net sales of Enterprise services aimed at large corporations was supported by new services but was moderate due to the weak demand for risk management services. In addition prior year net sales was boosted by demand for services relating to government corona support activities. The business area will continue to actively invest in customer-driven service development, which is a key factor behind the development of the business area's net sales.
The net sales of the Consumer Insight business area amounted to EUR 53,2 million (EUR 49,3 million) in the period under review. Compared with the corresponding period in the previous year, the net sales of the business area increased by 8,0% at reported exchange rates and 5,1% at comparable exchange rates. In the first quarter of the period under review, the market conditions for consumer information and decision-making services remained challenging due to the economic impacts of the COVID-19 pandemic, but market demand recovered particularly well in the second quarter in Sweden, which had a significant positive impact on the development of the business area's net sales. Growth in demand slowed down in Sweden during third quarter. In Finland, the recovery of market demand only began in the third quarter, boosted by increased economic activity. However, the recovery of the consumer credit has been slower than the recovery of market demand in general, mainly due to interest rate cap regulations. Consumer information services focused on sales and marketing continued to see strong development in Finland thanks to new customer acquisition and new services. The development of consumer services remained strong and was supported by service development and successful marketing investments in both the Swedish and the Finnish market. In Finland, the growth of the updated omatieto.fi service solution for consumers continued and the demand for our services has been supported by increased consumer awareness regarding protection from identity theft.
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The net sales of the Digital Processes business area in the review period amounted to EUR 9,8 million (EUR 7,7 million). Compared with the corresponding period in the previous year, the net sales of the business area increased by 27,6 % at reported exchange rates and 26,0 % at comparable exchange rates. Activity in the housing market remained high during the review period in both Finland and Sweden, which had a strong positive impact on the net sales performance of our housing related digital services. Thanks to successful service development, the net sales of our digital real estate and housing information services have grown significantly in the favourable market climate, with transaction-specific added value increasing and volumes seeing strong development. In line with the strategy, the business area will continue to make significant investments in the service development aimed at the digitalisation of data-intensive processes related to housing and collateral management, where improving the customer experience and process efficiency holds significant value creation potential going forward.
FINANCIAL RESULTS
July - September
Enento Group's operating profit (EBIT) for the third quarter amounted to EUR 8,9 million (EUR 9,2 million). Operating profit included items affecting comparability of EUR 3,0 million (EUR 3,2 million), mainly arising from amortisation from fair value adjustments related to acquisitions of EUR 3,1 million (EUR 3,1 million) and adjustment of M&A related expenses.
Third-quarter adjusted EBITDA excluding items affecting comparability was EUR 14,5 million (EUR 14,8 million). Adjusted EBITDA decreased by EUR 0,3 million at reported exchange rates and by EUR 0,5 million at comparable exchange rates.
Adjusted operating profit (EBIT) excluding amortisation from fair value adjustments related to acquisitions and items affecting comparability decreased by EUR 0,4 million in the third quarter to EUR 11,9 million (EUR 12,4 million). Adjusted EBIT margin for the third quarter decreased compared with the corresponding quarter in the previous year. Decrease was due to expensed investments made to support future growth. Comparison period cost levels were exceptionally low due to cost saving measures taken in the prior year. The future growth investments together with third quarter relatively modest net sales development had an impact on profitability. Depreciation related to capitalised development costs increased by EUR 0,1 million compared with the corresponding quarter in the previous year.
The Group's depreciation and amortisation in the third quarter amounted to EUR 5,7 million (EUR 5,5 million). Of the depreciation and amortisation, EUR 3,1 million (EUR 3,1 million) resulted from the amortisation of fair value adjustments related to acquisitions. The Group's depreciation on right-of-use assets (IFRS 16) in the third quarter amounted to EUR 0,6 million (EUR 0,6 million).
The Group's share of associated company's net income in the third quarter was EUR -0,2 million including also amortisation from fair value adjustments (EUR 0).
Net financial expenses in the third quarter were EUR 0,5 million (EUR 0,7 million). Financial expenses related to lease liabilities (IFRS 16) were EUR 0,0 million (0,0 million) in the third quarter, and recognised exchange rate gains amounted to EUR 0,0 million (EUR -0,0 million).
The Group's profit before income taxes for the third quarter was EUR 8,2 million (EUR 8,5 million).
The tax amount booked as expense for the third quarter was EUR -1,7 million (EUR -1,8 million).
The Group's profit for the third quarter was EUR 6,5 million (EUR 6,7 million).
January – September
Enento Group's operating profit (EBIT) for the review period amounted to EUR 27,5 million (EUR 21,7 million). Operating profit included items affecting comparability of EUR 9,4 million (EUR 11,3 million), mainly arising from amortisation of fair value adjustments of EUR 9,5 million (EUR 9,1 million), M&A related expenses, reversal of excess redundancy provisions and received insurance compensation.
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Adjusted EBITDA for the review period excluding items affecting comparability amounted to EUR 44,5 million (EUR 39,7 million). Adjusted EBITDA increased by EUR 4,8 million at reported exchange rates and by EUR 4,1 million at comparable exchange rates.
Adjusted operating profit (EBIT) for the review period excluding items affecting comparability and amortisation from fair value adjustments related to the acquisitions increased by EUR 3,9 million to EUR 36,9 million (EUR 33,0 million). The adjusted EBIT margin for the review period grew year-on-year. Profitability grew thanks to net sales growth with scalable business model especially in the second quarter, cost base prioritisations in abnormal macroeconomic environment focusing on strategic focus areas activities and synergy savings.
The Group's depreciation and amortisation for the review period amounted to EUR 17,1 million (EUR 15,8 million). Of the depreciation and amortisation, EUR 9,5 million (EUR 9,1 million) resulted from amortisation from fair value adjustments related to the acquisitions. The Group's depreciation of right-of-use assets (IFRS 16) during the review period amounted to EUR 1,8 million (EUR 1,7 million).
The Group's share of associated company's net income in the third quarter was EUR -0,2 million including also amortisation from fair value adjustments (EUR 0).
Net financial expenses during the review period were EUR 1,6 million (EUR 1,9 million). Financial expenses related to lease liabilities (IFRS 16) were EUR 0,1 million (0,1 million) in the review period, and recognised exchange rate gains amounted to EUR 0,3 million (EUR 0,1 million).
The Group's profit before income taxes for the review period was EUR 25,7 million (EUR 19,9 million).
The tax amount booked as expense for the review period was EUR -5,2 million (EUR -4,1 million).
The Group's profit for the review period was EUR 20,5 million (EUR 15,8 million).
CASH FLOW
In the review period, cash flow from operating activities amounted to EUR 30,7 million (EUR 29,5 million). The effect of the change in the Group's working capital on cash flow was EUR -4,9 million (EUR -2,2 million). The impact of items affecting comparability on operating cash flow was EUR -0,3 million (EUR -2,0 million).
The Group paid EUR 6,8 million (EUR 4,2 million) in taxes during the review period.
Cash flow from investing activities for the review period amounted to EUR -15,3 million (EUR -6,8 million). The cash flow from investing activities consisted of acquisitions of property, plant and equipment and intangible assets as well as investment in associated company.
Cash flow from financing activities for the review period amounted to EUR -24,6 million (EUR -16,2 million). The cash flow from financing activities for the review period consisted of an equity repayment and repayments of lease liabilities (IFRS 16).
STATEMENT OF FINANCIAL POSITION
At the end of the review period, the Group's total assets were EUR 541,5 million (EUR 537,7 million). Total equity amounted to EUR 309,2 million (EUR 307,8 million) and total liabilities to EUR 232,4 million (EUR 229,9 million). The change in equity mainly consists of the result for the review period and a translation difference included in comprehensive income, largely attributable to the weakening of the Swedish krona and the repayment of equity. Of the total liabilities, EUR 165,5 million (EUR 164,0 million) were long-term interest-bearing liabilities. Of the total liabilities, EUR 22,3 million (EUR 22,5 million) were deferred tax liabilities, EUR 8,3 million (EUR 7,8 million) non-current pension liabilities, EUR 2,3 million (EUR 2,2 million) current interest-bearing lease liabilities and EUR 33,9 million (EUR 35,6 million) current non-interest-bearing liabilities. Goodwill amounted to EUR 356,0 million (EUR 348,9 million) at the end of the review period.
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Enento Group's cash and cash equivalents at the end of the review period were EUR 16,8 million (EUR 25,9 million), and net debt was EUR 151,0 million (EUR 140,3 million).
CAPITAL EXPENDITURE
The majority of Enento Group's capital expenditure is related to the development of new products and services, service platform and IT infrastructure. Other capital expenditure mainly comprises purchases of company cars and office equipment. The Group's gross capital expenditure in the review period amounted to EUR 11,8 million (EUR 8,4 million). Capital expenditure on intangible assets was EUR 10,3 million (EUR 7,6 million) and capital expenditure on property, plant and equipment was EUR 1,5 million (EUR 0,8 million).
The product development activities of Enento Group involve development of the product and service offering. During the review period, the capitalised development and software costs of the Group amounted to EUR 9,9 million (EUR 7,4 million). The Group had no material research activities.
PERSONNEL
The average number of personnel employed by Enento Group during the third quarter of the year was 430 (422). At the end of the review period, the number of people employed by Enento Group was 433 (421), of whom 181 (167) worked in the Finnish companies, 208 (211) in the Swedish companies, 40 (42) in the Norwegian company and 4 (1) in the Danish company.
During the review period, the personnel expenses of the Group amounted to EUR 29,2 million (EUR 26,9 million) and included an accrued cost of EUR 302 thousand (EUR 504 thousand) from the management's long-term incentive plan. More details on the management's long-term incentive plan are provided in section 2.7. Transactions with related parties in the notes to the condensed interim report.
- Sales, Marketing and Communications 29%
- Business Areas 35%
- IT, Technology and Data & Analytics 27%
- Administration, Finance and HR 9%
Key figures describing the Group's personnel:
| PERSONNEL | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
|---|---|---|---|---|---|
| Average number of personnel | 430 | 422 | 427 | 425 | 430 |
| Full time | 414 | 409 | 411 | 412 | 417 |
| Part time and temporary | 16 | 13 | 16 | 13 | 13 |
| Geographical distribution | |||||
| Finland | 180 | 167 | 177 | 168 | 176 |
| Sweden | 205 | 211 | 204 | 212 | 207 |
| Norway | 41 | 43 | 42 | 43 | 45 |
| Denmark | 4 | 1 | 4 | 2 | 2 |
| Wages and salaries for the period (EUR million) | 6,2 | 6,0 | 21,3 | 19,9 | 27,4 |
OTHER EVENTS DURING THE REVIEW PERIOD
Annual General Meeting of 29 March 2021
The Annual General Meeting held on 29 March 2021 approved the Financial Statements and discharged the members of the Board of Directors and the company's CEO from liability for the financial year 2020 and resolved to approve the Remuneration report for governing bodies.
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The Annual General Meeting approved the Board of Directors' proposal to distribute funds of EUR 0,95 per share as an equity repayment from the reserve for invested unrestricted shareholders' equity of the company. The equity repayment was paid to shareholders registered in the company's shareholder register maintained by Euroclear Finland Ltd on the record date of the payment on 31 March 2021. The equity repayment was paid on 12 April 2021.
The Annual General Meeting resolved to approve to amend Charter of the Shareholders' Nomination Board as proposed by Shareholders' Nomination Board.
In accordance with the proposal of the Shareholders' Nomination Board, the Annual General Meeting resolved that the Board of Directors will consist of six members. In accordance with the proposal of the Shareholders' Nomination Board Petri Carpén, Patrick Lapveteläinen, Martin Johansson, Tiina Kuusisto and Minna Parhiala were re-elected as members of the Board of Directors. Erik Forsberg was elected as a new member of the Board of Directors.
In accordance with the proposal of the Shareholders Nomination Board, the Annual General Meeting resolved that the Chairperson of the Board of Directors be remunerated EUR 52,000 annually and that the members of the Board of Directors be remunerated EUR 36,750 annually. An attendance fee of EUR 500 shall be paid per Board of Directors meeting. For attending the Board Committee meetings, the Chairpersons of the Committees will be remunerated EUR 500 per meeting and the Committee members shall be remunerated EUR 400 per meeting. The members of the Shareholders' Nomination Board will not be remunerated. Reasonable travel expenses for attending the meetings will be reimbursed to the members of the Board of Directors and Shareholders' Nomination Board.
PricewaterhouseCoopers Oy, Authorized Public Accountants firm, was re-elected as the company's auditor. PricewaterhouseCoopers Oy notified the company that Authorised Public Accountant Martin Grandell would be the auditor-in-charge. The remuneration of the auditor will be paid according to the reasonable invoice approved by the Board of Directors' Audit Committee.
Authorisation for issue of shares
The Annual General Meeting authorized the Board of Directors to resolve on one or more issuances of shares, which contain the right to issue new shares in the company or to transfer the company's treasury shares. The authorisation covers up to a total of 1,500,000 shares.
The Board of Directors was also authorised to resolve on a directed issuance of shares in the company. The authorisation is proposed to be used for material arrangements from the company's point of view, such as financing or carrying out business arrangements or investments or for other such purposes determined by the Board of Directors in which case a weighty financial reason for issuing shares and for a possible directed issuance of shares.
The authorisation is effective for 18 months from the close of the Annual General Meeting, i.e. until 29 September 2022. The authorisation will revoke the share issue authorisation granted to the Board of Directors by the Annual General Meeting on 12 June 2020.
Enento Group Plc's Board of Directors decided on 10 February 2020 on a directed share issue related to the reward payment from the performance period 2018–2019 of the Matching Share Plan 2018. In the share issue, 13 769 new Enento Group Plc shares were issued without consideration to the key employees participating in the Matching Share Plan 2018 in accordance with the terms and conditions of the plan. The decision on a directed issue of shares was based on the authorisation given to the Board of Directors by the Annual General Meeting on 28 March 2019.
The Board of Directors of Enento Group Plc resolved on a directed share issue related to the reward payments based on the performance period 2018-2020 of the Long-term Incentive Plan 2018-2020 on 12 February 2021. The performance period began on 1 September 2018 and ended on 31 December 2020. In the share issue, 27 795 new Enento Group Plc shares were issued without consideration to the key employees participating in the Performance Period 2018-2020. The resolution on the directed share issue was based on the authorization granted to the Board of Directors by the Annual General Meeting of Shareholders held on 12 June 2020
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Authorisation for repurchasing own shares
Annual General Meeting authorized the Board of Directors to decide on the repurchase of a maximum of 1,500,000 of the company's own shares, in one or several instalments. The shares would be repurchased using the company's invested unrestricted shareholders' equity, and thus, the repurchases will reduce funds available for distribution. The shares could be repurchased, for example, for developing the Company's capital structure, for financing or carrying out potential corporate acquisitions or other business arrangements, to be used as a part of the Company's remuneration or incentive plan or to be otherwise transferred further, retained by the Company as treasury shares, or cancelled.
In accordance with the resolution of the Board of Directors, the shares could also be repurchased otherwise than in proposition to the existing shareholdings of the company as directed repurchases at the market price of the shares quoted on the trading venues where the company's shares are traded or at the price otherwise established on the market at the time of the repurchase.
The Board of Directors shall resolve on all other matters related to the repurchase of the Company's own shares, including on how shares will be repurchased. Among other means, derivatives may be used in acquiring the shares.
The authorisation is effective for 18 months from the close of the Annual General Meeting, i.e. until 29 September 2022. The authorisation will revoke the authorisation to repurchase the company's shares granted to the Board of Directors by the Annual General Meeting on 12 June 2020. The authorisation has not been used as of 29 October 2021.
Changes in Executive Management Team January - September
Enento Group Plc's CEO Jukka Ruuska has on 21 April 2021 given notice of his resignation from the company. Jukka Ruuska will continue in his position until 31 October 2021.
Jeanette Jäger has been appointed Enento Group Plc's CEO and member of the Executive Management Team. She will start in her position on 1 January 2022.
Jeanette Jäger has strong experience in the Nordic banking and finance sector in leadership, ICT, Finance and Sales & Marketing positions. Since 2016 she has worked in the Swedish company Bankgirot, first as VP Digital Services and from 2017 as CEO of Bankgirot. Previously she has acted in different C-level positions in Tieto and TDC Communication.
Enento Group's Board of Directors has appointed Elina Stråhlman, the Group's CFO, as an acting CEO for the interim period from 1 November 2021 to 31 December 2021.
Enento Group Plc's CIO and member of the Executive Management Team Jörgen Olofsson has announced his resignation from the company. Jörgen Olofsson will continue as CIO and Executive Management Team member no later than until 30 November 2021. The selection of a new CIO has will be communicated separately.
Enento Group Plc's Director of the Business Insight Business Area and member of the Executive Management Team Heikki Koivula has announced his resignation from the company on 20 July 2021. Heikki Koivula will continue in his position until 15 January 2022. The selection of a new Director of the Business Insight Business Area will be communicated separately.
Enento Group new business area structure and Data and Analytics functional unit, 1 April 2021
On 14 January 2021, Enento Group Plc announced its plan of changing the business area structure and creating a new Data and Analytics unit. The change in the organisational structure is aimed at enabling faster and smoother strategy implementation and highlighting the importance of data and analytics.
Starting 1 April 2021 Enento Group has three business areas: Business Insight, Consumer Insight and Digital Processes.
The new Consumer Insight business area will focus on customer-driven consumer information services, while the new Business Insight business area will focus on business information services.
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Enento Group made an investment in associated company
Enento Group Plc acquired 38,3 % shareholding of Goava Sales Intelligence AB on 24.6.2021 by subscribing to new preference shares in the company. At the same time Enento agreed to complete subsequent preference share subscriptions provided that the company fulfills certain preconditions laid out in the business plan, as well as acquired a purchase option to acquire all outstanding shares in the company after a mutually agreed business plan period ending in year 2024. The subscription price of the preference shares is approximately SEK 38,4 million and was paid in cash.
Goava Sales Intelligence AB, headquartered in Stockholm in Sweden, was founded in 2016 and currently employs 14 persons as well as contracts 15 external software developers. The company is led by its founders as well as management team with a considerable ownership stake in the company. Goava currently services more than 140 customers mainly in the Swedish market.
Enento Group upgraded its net sales outlook for 2021
Enento Group Plc upgraded its net sales outlook for 2021 on 8 July 2021, driven by the strong development in the second quarter. Net sales is expected to grow in 2021 in accordance with the long-term target range (5-10%), exceeding the mid-point of that range. In its previous future outlook, Enento Group has expected the net sales growth rate to be in the long-term target range (5-10%) but somewhat lower than the mid-point of the target range. The improved outlook is primarily due to the better-than-expected volume growth in the consumer information services in the Swedish market during the second quarter.
In terms of EBITDA margin and investments, the future outlook remains unchanged.
EVENTS AFTER THE REVIEW PERIOD
There have been no significant events after the review period.
SHARES AND SHAREHOLDERS
The Company has one share class. Each share carries one vote at the General Meeting of shareholders and each share confers equal right to dividends and net assets of the Company. The shares have no nominal value. The shares of the company are incorporated in the book-entry securities system maintained by Euroclear Finland Ltd.
A total of 27 795 new shares were subscribed for in Enento Group Plc's share issue directed to the company key employees without consideration. The new shares were entered into the Trade Register on 1 March 2021. After the registration, the total number of the shares in the Company is 24 034 856 shares. The new shares produce the right to dividends and other distribution of assets as well as other shareholder rights as of the registration date 1 March 2021. Trading in the new shares commenced on 2 March 2021.
On 30 September 2021, the total number of shares was 24 034 856 (24 007 061), and the share capital of the company amounted to EUR 80 000 (EUR 80 000).
According to the book-entry securities system, the company had 3 358 (2 985) shareholders on 30 September 2021. A list of the largest shareholders is available on the company's investor pages at enento.com/investors.
- Finance and insurance institutions 31,7 %
- Foreign shareholders 54,9 %
- General government 6,3 %
- Households 4,0 %
- Companies and housing companies 2,0 %
- Non-profit organisations 1,1 %
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| SHARE-RELATED KEY FIGURES | |||
|---|---|---|---|
| 1.1. – | 1.1. – | 1.1. – | |
| EUR (unless otherwise stated) | 30.9.2021 | 30.9.2020 | 31.12.2020 |
| Share price development | |||
| Highest price | 43,20 | 40,30 | 40,30 |
| Lowest price | 31,10 | 24,20 | 24,20 |
| Average price | 35,74 | 31,45 | 31,83 |
| Closing price | 35,30 | 34,00 | 33,60 |
| Market capitalisation, EUR million | 848,4 | 816,2 | 806,6 |
| Trading volume, pcs | 2 435 899 | 3 512 941 | 6 757 380 |
| Total exchange value of shares, EUR million | 87,1 | 110,5 | 215,1 |
FLAGGING NOTIFICATIONS AND MANAGERS’ TRANSACTIONS
Flagging notifications in the review period
Notification according to Chapter 9, Paragraph 10 of the Securities Markets Act on 4 February 2021
Enento Group Plc received an announcement on 4 February 2021 referred to in Chapter 9, Section 5 of the Securities Markets Act, according to which the holding of Invesco Ltd. has exceeded the threshold of 10 percent on 3 February 2021. The holding of Invesco Ltd. has increased to 2 403 879 shares, corresponding to 10,01 percent of Enento's entire share stock.
Managers’ transactions
Transactions by Enento Group's management during the review period have been published as Stock Exchange Releases and they can be read on the company's investor pages at enento.com/investors
RISKS AND UNCERTAINTIES IN THE NEAR FUTURE
The demand for the Group's products and services depends on the activity of the business operations of its customers. Slow economic growth or a declining economy may result in a weakening demand for the services of Enento Group. In addition, regulatory changes that reduce the lending ability of the Group's customers may have a negative effect on the demand for the Group's services and products.
Nordic countries have been removing restrictions relating to COVID-19 pandemic at the state level. The Group has assessed the risks and uncertainties arising from the continuing pandemic. Due to the situation, the Group's ability to predict the potential effects on the demand for its services has been somewhat reduced. The potential business impacts of the pandemic-related risks that affect demand factors are managed by proactive cost adaptation measures and contingency plans. The Group expects the increase in credit risk to be limited because a significant proportion of the Group's customers are financially sound companies in the financial industry, whose credit risk is assessed to be low by the Group. For managing liquidity risk, the Group has unused credit arrangements and the Group does not have any external loans maturing before October 2023.
The exchange rate risk arising from the volatility of the Nordic currencies is primarily managed by operational means. Sales and purchases are mainly generated in the operating currency of each Group company. As a result, the Group is not exposed to significant transaction risk. The Group manages translation risk by financing its business operations outside Finland in the local currency. This means that changes in operating profit arising from the fluctuation of exchange rates can be partly offset by changes in financing costs. The Group's reporting currency is the euro and the Group has significant business operations denominated in the Swedish krona and the Norwegian krone. Consequently, changes in exchange rates have an impact on the development of the Group's reported net sales, EBITDA and profit.
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A general tendency to seek cost savings in business activities and the tightening competition in the Group’s business sector may cause downward pricing pressure, which may have a negative effect on revenue and profit.
Enento Group believes that its continued success will be influenced by its ability to meet customers’ needs through the development of products and services that are easy to use and that seek to increase customers’ business process efficiency, offer cost savings, and facilitate better business decisions. Potential deficiencies in the management of the product development portfolio, as well as a shortage of development resources, may delay the introduction of new services or enhancements to the market and therefore weaken the Group’s results.
Well-functioning information technology and good availability of services are essential conditions for the business operations of Enento Group. Notwithstanding the current solutions for high availability and protection solutions in accordance with best practices, the realisation of external or internal threats can never be completely eliminated. The realisation of risks of this kind could result in misuse, modification or illegal publication of information and could have legal consequences or cause reputational harm, loss of revenue, claims or regulatory actions.
Helsinki, 29 October 2021
ENENTO GROUP PLC
Board of Directors
For further information:
Jukka Ruuska
CEO
Enento Group Plc
Tel. +358 10 270 7111
Distribution:
Nasdaq Helsinki
Major media
enento.com/investors
Enento Group is a Nordic knowledge company powering society with intelligence since 1905. We collect and transform data into intelligence and knowledge used in interactions between people, businesses and societies. Our digital services, data and information empower companies and consumers in their daily digital decision processes, as well as financial processes and sales and marketing processes. Approximately 425 people are working for Enento Group in Finland, Norway, Sweden and Denmark. The Group’s net sales for 2020 was 151.3 MEUR. Enento Group is listed on Nasdaq Helsinki with the trading code ENENTO.
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CONDENSED INTERIM REPORT AND NOTES 1.1. – 30.9.2021
The figures presented in this Interim Report have not been audited. The amounts presented in the Interim Report are rounded, so the sum of individual figures may differ from the sum reported.
- Consolidated statement of comprehensive income, financial position, cash flows and changes in equity
| CONSOLIDATED STATEMENT OF INCOME | |||||
|---|---|---|---|---|---|
| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Net sales | 38 625 | 36 732 | 120 404 | 111 100 | 151 317 |
| Other operating income | 172 | 150 | 577 | 510 | 649 |
| Materials and services | -6 611 | -6 265 | -20 189 | -18 893 | -25 442 |
| Personnel expenses^{1} | -8 615 | -8 108 | -29 221 | -26 906 | -36 815 |
| Work performed by the entity and capitalised | 650 | 562 | 2 630 | 1 960 | 2 732 |
| Total personnel expenses | -7 965 | -7 545 | -26 591 | -24 946 | -34 083 |
| Other operating expenses | -9 645 | -8 358 | -29 653 | -30 251 | -43 314 |
| Depreciation and amortisation | -5 690 | -5 508 | -17 067 | -15 771 | -21 311 |
| Operating profit | 8 886 | 9 207 | 27 482 | 21 749 | 27 816 |
| Share of results of associated companies and joint ventures | -173 | - | -173 | - | - |
| Finance income | 48 | 4 | 316 | 259 | 271 |
| Finance expenses | -591 | -734 | -1 923 | -2 120 | -2 998 |
| Finance income and expenses | -543 | -731 | -1 607 | -1 861 | -2 728 |
| Profit before income tax | 8 170 | 8 476 | 25 701 | 19 888 | 25 088 |
| Income tax expense | -1 717 | -1 754 | -5 203 | -4 085 | -5 640 |
| Profit for the period | 6 453 | 6 722 | 20 499 | 15 803 | 19 448 |
| Items that may be reclassified to profit or loss: | |||||
| Translation differences on foreign units | -1 522 | -2 074 | -3 562 | -4 620 | 9 878 |
| Hedging of net investments in foreign units | 369 | 456 | 869 | 746 | -2 603 |
| Income tax relating to these items | -74 | -91 | -174 | -149 | 521 |
| -1 227 | -1 709 | -2 867 | -4 023 | 7 795 | |
| Items that will not be reclassified to profit or loss | |||||
| Remeasurements of post-employment benefit obligations | - | - | - | - | -292 |
| Income tax relating to these items | - | - | - | - | 60 |
| - | - | - | - | -232 | |
| Other comprehensive income for the period, net of tax | -1 227 | -1 709 | -2 867 | -4 023 | 7 564 |
| Total comprehensive income for the period | 5 226 | 5 013 | 17 632 | 11 780 | 27 012 |
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| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
|---|---|---|---|---|---|
| Profit attributable to: | |||||
| Owners of the parent company | 6 453 | 6 722 | 20 499 | 15 803 | 19 448 |
| Total comprehensive income attributable to: | |||||
| Owners of the parent company | 5 226 | 5 013 | 17 632 | 11 780 | 27 012 |
| Earnings per share attributable to the owners of the parent during the period: | |||||
| Basic, EUR | 0,27 | 0,28 | 0,85 | 0,66 | 0,81 |
| Diluted, EUR | 0,27 | 0,28 | 0,85 | 0,66 | 0,81 |
1 Personnel expenses include accrued expenses related to the long-term incentive plan to the management in the following amounts: third quarter 1 July–30 September 2021 EUR 87 thousand, the reference period 1 July–30 September 2020 EUR 156 thousand, the review period 1 January–30 September 2021 EUR 302 thousand and the reference period 1 January–30 September 2020 EUR 504 thousand.
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| CONSOLIDATED STATEMENT OF FINANCIAL POSITION | |||
|---|---|---|---|
| EUR thousand | 30.9.2021 | 30.9.2020 | 31.12.2020 |
| ASSETS | |||
| Non-current assets | |||
| Goodwill | 355 974 | 348 948 | 358 233 |
| Other intangible assets | 127 324 | 127 941 | 132 972 |
| Property, plant and equipment | 2 739 | 2 213 | 2 084 |
| Right-of-use assets | 6 792 | 7 923 | 7 489 |
| Deferred tax assets | - | 418 | 486 |
| Investments in associated companies and joint ventures | 3 607 | - | - |
| Financial assets and other receivables | 76 | 76 | 76 |
| Total non-current assets | 496 512 | 487 519 | 501 339 |
| Current assets | |||
| Account and other receivables | 28 258 | 24 306 | 25 030 |
| Cash and cash equivalents | 16 766 | 25 918 | 26 164 |
| Total current assets | 45 025 | 50 223 | 51 194 |
| Total assets | 541 537 | 537 742 | 552 533 |
| EUR thousand | 30.9.2021 | 30.9.2020 | 31.12.2020 |
| EQUITY AND LIABILITIES | |||
| Equity attributable to owners of the parent | |||
| Share capital | 80 | 80 | 80 |
| Invested unrestricted equity reserve | 294 533 | 325 529 | 317 367 |
| Translation differences | 5 335 | -3 616 | 8 202 |
| Retained earnings | 9 207 | -14 144 | -10 575 |
| Equity attributable to owners of the parent | 309 155 | 307 848 | 315 073 |
| Share of equity held by non-controlling interest | 0 | 0 | 0 |
| Total equity | 309 155 | 307 848 | 315 073 |
| Liabilities | |||
| Non-current liabilities | |||
| Financial liabilities | 165 507 | 164 040 | 166 960 |
| Pension liabilities | 8 342 | 7 813 | 8 465 |
| Deferred tax liabilities | 22 295 | 22 480 | 23 213 |
| Other non-current liabilities | 41 | ||
| Total non-current liabilities | 196 185 | 194 333 | 198 638 |
| Current liabilities | |||
| Financial liabilities | 2 283 | 2 192 | 2 458 |
| Advances received | 11 268 | 10 957 | 12 075 |
| Account and other payables | 22 646 | 22 412 | 24 289 |
| Total current liabilities | 36 196 | 35 561 | 38 822 |
| Total liabilities | 232 381 | 229 894 | 237 459 |
| Total equity and liabilities | 541 537 | 537 742 | 552 533 |
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| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | |||||||
|---|---|---|---|---|---|---|---|
| Attributable to owners of the parent | |||||||
| EUR thousand | Share capital | Invested unrestricted equity reserve | Translation differences | Retained earnings | Total | Share of equity held by non-controlling interest | Total equity |
| Equity at 1.1.2021 | 80 | 317 367 | 8 202 | -10 575 | 315 073 | 0 | 315 073 |
| Profit for the period | - | - | - | 20 499 | 20 499 | - | 20 499 |
| Other comprehensive income for the period | |||||||
| Hedging of net investments | - | - | 695 | - | 695 | - | 695 |
| Defined benefit plans | - | - | - | - | - | - | - |
| Translation differences | - | - | -3 562 | - | -3 562 | - | -3 562 |
| Total comprehensive income for the period | - | - | -2 867 | 20 499 | 17 632 | - | 17 632 |
| Transactions with owners | |||||||
| Distribution of funds | - | -22 833 | - | - | -22 833 | - | -22 833 |
| Management's incentive plan | - | - | - | -718 | -718 | - | -718 |
| Equity at 30.9.2021 | 80 | 294 533 | 5 335 | 9 207 | 309 155 | 0 | 309 155 |
| Attributable to owners of the parent | |||||||
| EUR thousand | Share capital | Invested unrestricted equity reserve | Translation differences | Retained earnings | Total | Share of equity held by non-controlling interest | Total equity |
| Equity at 1.1.2020 | 80 | 340 173 | 407 | -29 985 | 310 675 | 0 | 310 675 |
| Profit for the period | - | - | - | 15 803 | 15 803 | - | 15 803 |
| Other comprehensive income for the period | |||||||
| Hedging of net investments | - | - | 746 | -149 | 597 | - | 597 |
| Defined benefit plans | - | - | - | - | - | - | - |
| Translation differences | - | - | -4 769 | 149 | -4 620 | - | -4 620 |
| Total comprehensive income for the period | - | - | -4 023 | 15 803 | 11 780 | - | 11 780 |
| Transactions with owners | |||||||
| Distribution of funds | - | -14 644 | - | - | -14 644 | - | -14 644 |
| Management's incentive plan | - | - | - | 37 | 37 | - | 37 |
| Equity at 30.9.2020 | 80 | 325 529 | -3 616 | -14 144 | 307 848 | 0 | 307 848 |
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| CONSOLIDATED STATEMENT OF CASH FLOWS | |||||
|---|---|---|---|---|---|
| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Cash flow from operating activities | |||||
| Profit before income tax | 8 170 | 8 476 | 25 701 | 19 888 | 25 088 |
| Adjustments: | |||||
| Depreciation and amortisation | 5 690 | 5 508 | 17 067 | 15 771 | 21 311 |
| Finance income and expenses | 716 | 731 | 1 780 | 1 861 | 2 728 |
| Profit (-) / loss (+) on disposal of property, plant and equipment | -66 | -28 | -143 | -124 | -149 |
| Management's incentive plan | 87 | 156 | -718 | -185 | -29 |
| Other adjustments | -29 | -30 | -187 | 1 | -206 |
| Cash flows before change in working capital | 14 568 | 14 814 | 43 500 | 37 212 | 48 743 |
| Change in working capital: | |||||
| Increase (-) / decrease (+) in account and other receivables | 1 245 | 1 160 | -3 380 | -1 197 | -1 108 |
| Increase (+) / decrease (-) in account and other payables | -941 | -1 460 | -1 514 | -978 | 1 544 |
| Change in working capital | 304 | -300 | -4 894 | -2 176 | 436 |
| Interest expenses paid | -67 | -104 | -1 223 | -1 330 | -2 593 |
| Interest income received | 12 | 4 | 54 | 29 | 50 |
| Income taxes paid | -1 632 | -1 255 | -6 786 | -4 235 | -5 725 |
| Cash flow from operating activities | 13 185 | 13 158 | 30 652 | 29 501 | 40 912 |
| Cash flows from investing activities | |||||
| Purchases of property, plant and equipment | - | -126 | -1 513 | -739 | -948 |
| Purchases of intangible assets | -3 381 | -2 158 | -10 501 | -6 541 | -9 928 |
| Purchases of subsidiaries, net of cash acquired | - | - | - | - | - |
| Proceeds from sale of property, plant and equipment | 198 | 117 | 467 | 496 | 621 |
| Investments in associated companies and joint ventures | - | - | -3 802 | - | - |
| Cash flows from investing activities | - 3 184 | -2 168 | -15 349 | -6 784 | -10 254 |
| Cash flows from financing activities | |||||
| Proceeds from interest-bearing liabilities | - | - | - | - | - |
| Repayments of interest-bearing liabilities | -587 | -574 | -1 766 | -1 555 | -2 127 |
| Dividends paid and other profit distribution | - | -1 350 | -22 833 | -14 644 | -22 807 |
| Cash flows from financing activities | -587 | -1 924 | -24 599 | -16 200 | -24 934 |
| Net increase / decrease in cash and cash equivalents | 9 413 | 9 067 | -9 296 | 6 517 | 5 724 |
| Cash and cash equivalents at the beginning of the period | 7 386 | 17 064 | 26 164 | 20 361 | 20 361 |
| Net change in cash and cash equivalents | 9 413 | 9 067 | -9 296 | 6 517 | 5 724 |
| Translation differences of cash and cash equivalents | -33 | -213 | -101 | -960 | 79 |
| Cash and cash equivalents at the end of the period | 16 766 | 25 918 | 16 766 | 25 918 | 26 164 |
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2. Notes
2.1. Accounting policies
This Interim Report has been prepared in accordance with IAS 34 Interim Financial Reporting. The accounting policies and methods applied in the Interim Report are the same as those applied in the financial statements for the financial year ended 31 December 2020.
The preparation of financial statements in accordance with IFRS requires Enento Group's management to use estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the reported amounts of income and expenses for the review period. In addition, it is necessary to exercise judgment in applying the accounting policies. Because estimates and assumptions are based on the understanding as at the end of the interim period, they include risks and uncertainties. The actual results may differ from the estimates and assumptions made. Critical accounting estimates and judgments are disclosed in more detail under Note 3 to the consolidated financial statements for the year 2020.
The foreign subsidiaries' income statements and cash flows have been converted into euro on a monthly basis using the monthly average exchange rate issued by the European Central Bank, and balance sheets have been converted using the exchange rate issued by the European Central Bank on the end date of the period. Conversion of the profit for the period using different exchange rates for the income statement and balance sheet causes a translation difference in the balance sheet recognised in equity.
The change in equity is recognised in other comprehensive income. The amounts presented in the Interim Report are consolidated figures. The amounts presented are rounded, so the sum of individual figures may thus differ from the sum reported. The figures presented in this Interim Report have not been audited.
Changes in accounting policies
There were no changes in accounting policies during the review period.
New standards and interpretations not yet adopted
Enento Group adopts new and amended standards and interpretations on their effective date or, if the date is other than the first day of the financial year, from the beginning of the subsequent financial year.
The IFRS standards and IFRIC interpretations that have already been published but are not yet in effect are not expected to have a material impact on Enento Group.
2.2. Net sales
| NET SALES BY BUSINESS AREA | |||||
|---|---|---|---|---|---|
| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Business Insight | 17 929 | 17 105 | 57 387 | 54 158 | 74 243 |
| Consumer Insight | 17 514 | 16 731 | 53 212 | 49 261 | 66 164 |
| Digital Processes | 3 183 | 2 896 | 9 804 | 7 681 | 10 910 |
| Total | 38 625 | 36 732 | 120 404 | 111 100 | 151 317 |
Net sales comparison figures have been restated to correspond to the new Business Area structure.
Enento Group's organisation consists of two types of units: business areas and functional units.
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Starting 1 April 2021, Enento Group has three Business Areas: Business Insight, Consumer Insight and Digital Processes. The new Consumer Insight Business Area will focus on customer-driven consumer information services, while the new Business Insight Business Area will focus on business information services.
Business Insight Business Area consists of three business lines. Enterprise Solutions is responsible for service offering and development for the strategic and large customers in the key customer verticals, including banking and finance. The Enterprise Solutions services are part of the previous Risk Decisions Business Area and Customer Data Management's Business-to-Business services. The Premium Solutions business line provides business information services for the needs of SMEs. Premium Solutions were previously part of the SME and Consumers Business Area. Freemium Solutions develops freemium-model business information websites in all Nordic markets. Freemium Solutions were previously part of the SME and Consumers Business Area.
Consumer Insight Business Area develops and provides leading consumer information and decisioning services in the Nordics. Consumer Insight serves both consumers and several industries, the largest ones including finance and banking as well as e-commerce, oil and energy sectors, among others. The products and services are primarily used for risk management, finance, administration and decision-making. Consumer services for businesses were previously part of the Risk Decisions and Customer Data Management Business Areas. The services for consumers were previously part of the SME and Consumers Business Area. These services help consumers to understand and better manage their own finances, protecting them also from identity theft and fraud.
Digital Processes Business Area services remain unchanged. The Business Area's range of services includes real estate and apartment information, information about buildings and their valuation as well as solutions to automate collateral management processes and digitalize the management of housing transactions. In addition, the Business Area's service offering includes compliance services to identify companies' beneficial owners and politically exposed persons.
2.3. Acquisitions
Investments in associated companies
Enento Group Plc signed an agreement on 23 June 2021 to acquire 38,3% share in Goava Sales Intelligence AB by subscribing to new preferred shares. The subscription price of the preference shares was approximately SEK 38,4 million. Goava Sales Intelligence AB, headquartered in Stockholm in Sweden, was founded in 2016 and currently employs 14 persons as well as contracts 15 external software developers. The company is led by its founders as well as management team with a considerable ownership stake in the company. Goava currently services more than 140 customers mainly in the Swedish market.
The investment will be treated as an associated company in Enento Group's financial reporting using the equity method. Enento Group's share of the associated company's profit for the financial period is presented as a separate item below the operating profit in the consolidated statement of income.
2.4. Equity
| CHANGES IN NUMBER OF SHARES | ||
|---|---|---|
| Number of shares | Total number of shares | |
| 1.1.2020 | 23 993 292 | |
| Shares issued to the management's incentive system | 13 769 | 24 007 061 |
| 30.9.2020 | 24 007 061 | |
| 1.1.2021 | 24 007 061 | |
| Shares issued to the management's incentive system | 27 795 | 24 034 856 |
| 30.9.2021 | 24 034 856 |
Enento Group's Interim Report 1.1. – 30.9.2021
A total of 27 795 new shares were subscribed for in Enento Group Plc's share issue directed to the company key employees without consideration. The new shares were entered into the Trade Register on 1 March 2021. After the registration, the total number of the shares in the Company is 24 034 856 shares. The new shares produce the right to dividends and other distribution of assets as well as other shareholder rights as of the registration date 1 March 2021. Trading in the new shares commenced on 2 March 2021. The issuance of shares related to share-based remuneration is disclosed in the notes to the condensed financial statements, in Note 2.7 Transactions with related parties.
A total of 13 769 new shares were subscribed for in Enento Group Plc's share issue directed to the company key personnel without payment. The shares were registered in the Trade Register on 26 February 2020. The new shares produce the right to dividends and other distribution of assets, as well as other shareholder rights, as of the registration date 26 February 2020. Trading in the new shares commenced on 27 February 2020. The issuance of shares related to share-based remuneration is disclosed in the notes to the condensed financial statements, in Note 2.7 Transactions with related parties.
For the financial year 2020, Enento Group Plc distributed EUR 0,95 of funds per share, totalling EUR 22,8 million. The equity repayment was made on 12 April 2021.
For the financial year 2019, Enento Group Plc distributed EUR 0,95 of funds per share, totalling EUR 22,8 million. The equity repayments were made on 25 June 2020 (EUR 0,61 per share) and 26 November 2020 (EUR 0,34 per share).
2.5. Financial liabilities
| FINANCIAL LIABILITIES OF THE GROUP | |||
|---|---|---|---|
| EUR thousand | 30.9.2021 | 30.9.2020 | 31.12.2020 |
| Non-current | |||
| Loans from financial institutions | 160 769 | 158 152 | 161 535 |
| Lease liabilities | 4 738 | 5 888 | 5 425 |
| Total | 165 507 | 164 040 | 166 960 |
| Current | |||
| Lease liabilities | 2 283 | 2 192 | 2 241 |
| Total | 2 283 | 2 192 | 2 241 |
| Total financial liabilities | 167 790 | 166 232 | 169 201 |
Of the loans from financial institutions, EUR 95,7 million (EUR 95,5 million) were EUR-denominated and EUR 65,1 million (EUR 62,6 million) were SEK-denominated on 30 September 2021.
Enento Group Plc's unsecured financing consists of a term loan of EUR 160 million and a revolving credit facility of EUR 20 million. The Company took out the term loan partly in EUR and partly in SEK in accordance with the terms of the loan agreement. The loans mature in October 2023. At the end of the review period, the Company had used EUR 0 (EUR 0) of its credit facility.
To facilitate efficient cash management in the Group, a multi-currency cash pool arrangement has been implemented with Danske Bank A/S. An overdraft of EUR 15,0 million is included in the cash pool arrangement. The overdraft had not been utilised on 30 September 2021.
The loans include a financial covenant reviewed on a quarterly basis, which is Net debt to EBITDA calculated in accordance with the financing agreement. The ratio of the Group's net debt, as defined in the financing agreement, to EBITDA adjusted according to the terms of the financing agreement was 2,6 (2,6) on 30 September 2021. The covenant limit in accordance with the financing agreement was 3,5 (3,5) on 30 September 2021.
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2.6. Lease agreement commitments
| LEASE AGREEMENT COMMITMENTS | |||
|---|---|---|---|
| EUR thousand | 30.9.2021 | 30.9.2020 | 31.12.2020 |
| No later than 1 year | 14 | - | 14 |
| Total | 14 | - | 14 |
Lease agreement commitments are not shown for the interim period, unless the lease period is 12 months or less or the value of the lease agreement is low. The Group does not report the minimum leases of low-value lease agreements and IT service agreements as lease liabilities.
2.7. Transactions with related parties
Related parties of the Group consist of group entities, associated companies and shareholders having a significant influence over the Group. The shareholders who have had the right to nominate a representative in the Company's Board of Directors are considered as having significant influence in the Company. In addition, the key management persons, including the Board of Directors, CEO and Executive Team, are related parties of the Group, as well as their close family members and companies, where the above mentioned persons exercise controlling power.
| THE FOLLOWING TRANSACTIONS WERE CARRIED OUT WITH RELATED PARTIES | |||
|---|---|---|---|
| 1.1. – 30.9.2021 | |||
| EUR thousand | Sales of | ||
| goods and | |||
| services | Purchases | ||
| of goods | |||
| and services | Finance | ||
| income and | |||
| expenses | |||
| Shareholders having a significant influence over | |||
| the Group | 9 169 | -282 | -509 |
| Associated company | 16 | - | - |
| Total | 9 185 | -282 | -509 |
| 30.9.2021 | |||
| EUR thousand | Receivables | Liabilities | |
| Shareholders having a significant influence over | |||
| the Group | 1 500 | 53 944 | |
| Associated company | 16 | - | |
| Total | 1 515 | 53 944 | |
| 1.1. – 30.9.2020 | |||
| EUR thousand | Sales of | ||
| goods and | |||
| services | Purchases | ||
| of goods | |||
| and services | Finance | ||
| income and | |||
| expenses | |||
| Shareholders having a significant influence over | |||
| the Group | 8 979 | -317 | -541 |
| Associated company | - | - | - |
| Total | 8 979 | -317 | -541 |
| 30.9.2020 | |||
| EUR thousand | Receivables | Liabilities | |
| Shareholders having a significant influence over | |||
| the Group | 1 772 | 53 180 | |
| Associated company | - | - | |
| Total | 1 772 | 53 180 |
Transactions with related parties have been carried out on an arm's length basis. During the review period, the Group's related party transactions with key persons in management and members of the Board of Directors consisted of normal salaries and fees.
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Long-term incentive plans for the management
Long-term incentive plan for the management 2018–2020
The target group of the share-based long-term incentive plan decided on by the Board of Directors in August 2018 included 23 key persons of Enento Group, including the members of the Executive Team. In order to participate in the plan and receive an award, the participant must have purchased Enento Group Plc's shares or allocated previously held Enento shares to the programme in the number determined by the Board of Directors.
The award for the commitment period depended on the continuation of employment or service at the time of payment of the award and meeting of the shareholding requirement. Furthermore, the award for the performance period was based on total shareholder return (TSR) on Enento Group Plc share and the Group's adjusted EBITDA in 2020.
In the directed share issue, 27 795 new Enento Group Plc shares were issued without consideration to the key employees participating in the Performance Period 2018-2020. The resolution on the directed share issue was based on the authorization granted to the Board of Directors by the Annual General Meeting of Shareholders held on 12 June 2020. The new shares have been entered into the Trade Register on 1 March 2021 and trading of new shares alongside the existing shares commenced on 2 March 2021. For the review period, an accrued expense of EUR 269 thousand (EUR 316 thousand) has been recognised in personnel expenses.
Long-term incentive plan for the management 2020–2022
In December 2019, the Board of Directors decided on a new share-based long-term incentive plan for key persons of Enento Group. The target group of the plan includes 26 key persons, including the members of the Executive Team.
The incentive plan consists of one performance period covering the calendar years 2020–2022. The potential rewards from the plan will be paid partly in Enento Group Plc shares and partly in cash after the end of the performance period. The potential rewards are based on the achievement of targets set for the total shareholder return (TSR) of the Enento Group Plc share and the Group's cumulative adjusted EBITDA in 2020–2022. The rewards are also dependent on the continuation of the participants' employment or service contracts at the time of payment.
Rewards payable under the plan will not total more than the value of approximately 65 500 Enento Group Plc shares, including also the amount paid in cash. For the review period, an accrued expense adjustment of EUR 99 thousand (EUR 188 thousand) has been recognised in personnel expenses.
Long-term incentive plan for the management 2021–2023
In December 2020, the Board of Directors decided on a new share-based incentive plan for key persons. The target group of the plan includes 31 key persons, including the members of the Executive Team. This performance-based share incentive plan is based on the corresponding plan launched the previous year. The Group intends to launch a new long-term incentive plan annually, but the start of each individual plan is subject to a separate decision by the Board of Directors.
The incentive plan consists of one performance period covering the calendar years 2021–2023. The potential rewards from the plan will be paid partly in Enento Group shares and partly in cash after the end of the performance period. The purpose of the cash payment is to cover taxes and tax-like charges incurred by the participant for the reward. As a rule, no reward will be paid if the employment or service contract terminates before the payment of the reward.
The plan offers the participants the opportunity to earn rewards if the performance targets set by the Board of Directors are achieved. The performance targets are based on Enento Group's Total Shareholder Return (TSR) for 2021–2023 and Enento Group's cumulative adjusted EBITDA for 2021–2023. If the performance targets are met, the rewards will be payable in the first half of 2024.
Rewards payable under the plan will not total more than the value of approximately 73 000 Enento Group Plc shares, including also the amount paid in cash. For the review period, an accrued expense of EUR 132 thousand (EUR 0) has been recognised in personnel expenses.
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NOTE 1. KEY FINANCIAL INFORMATION FOR THE GROUP
Enento Group Plc presents alternative performance measures as additional information for key performance measures in the consolidated statements of income, financial position and cash flows prepared according to IFRS to reflect the financial development of its business operations and to enhance comparability from period to period. According to the management's view, alternative performance measures provide substantial supplemental information on the result of the Group's operations, financial position and cash flows to the management and investors, securities analysts and other parties. Alternative performance measures are not, as such, included in the consolidated financial statements prepared according to IFRS, but they are derived from the IFRS consolidated financial statements by adjusting items in the consolidated statements of income, financial position and cash flows and/or by proportioning them to each other. Alternative performance measures should not be considered as a substitute for measures in accordance with IFRS. All companies do not calculate alternative performance measures in a uniform way. Therefore, the company's alternative performance measures are not necessarily comparable with similarly named performance measures of other companies.
The alternative performance measures of this interim report have been calculated applying the same principles as presented in the Board of Directors' Annual Report for 2020.
| KEY INCOME STATEMENT AND CASH FLOW FIGURES AND RATIOS | |||||
|---|---|---|---|---|---|
| EUR million | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Net sales | 38,6 | 36,7 | 120,4 | 111,1 | 151,3 |
| Net sales growth, % | 5,2 | 0,1 | 8,4 | 4,1 | 3,7 |
| EBITDA | 14,6 | 14,7 | 44,5 | 37,5 | 49,1 |
| EBITDA margin, % | 37,7 | 40,1 | 37,0 | 33,8 | 32,5 |
| Adjusted EBITDA | 14,5 | 14,8 | 44,5 | 39,7 | 54,0 |
| Adjusted EBITDA margin, % | 37,5 | 40,3 | 37,0 | 35,7 | 35,7 |
| Operating profit (EBIT) | 8,9 | 9,2 | 27,5 | 21,7 | 27,8 |
| EBIT margin, % | 23,0 | 25,1 | 22,8 | 19,6 | 18,4 |
| Adjusted operating profit (EBIT) | 11,9 | 12,4 | 36,9 | 33,0 | 45,0 |
| Adjusted EBIT margin, % | 30,9 | 33,7 | 30,7 | 29,7 | 29,7 |
| Free cash flow | 9,9 | 11,0 | 19,8 | 23,5 | 32,6 |
| Cash conversion, % | 67,6 | 74,6 | 44,5 | 62,7 | 66,3 |
| Net sales from new services | 2,9 | 2,3 | 8,8 | 5,8 | 8,5 |
| New services of net sales, % | 7,6 | 6,3 | 7,3 | 5,2 | 5,6 |
| Earnings per share, basic, EUR | 0,27 | 0,28 | 0,85 | 0,66 | 0,81 |
| Earnings per share, diluted, EUR | 0,27 | 0,28 | 0,85 | 0,66 | 0,81 |
| Earnings per share, comparable, EUR¹ | 0,37 | 0,38 | 1,17 | 0,96 | 1,21 |
¹ The comparable earnings per share does not contain amortisation from fair value adjustments related to acquisitions or their tax impact.
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KEY BALANCE SHEET RATIOS
| EUR million | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
|---|---|---|---|---|---|
| Balance sheet total | 541,5 | 537,7 | 541,5 | 537,7 | 552,5 |
| Net debt | 151,0 | 140,3 | 151,0 | 140,3 | 143,0 |
| Net debt to adjusted EBITDA, x | 2,6 | 2,4 | 2,6 | 2,7 | 2,6 |
| Return on equity, % | 8,4 | 8,8 | 8,8 | 6,8 | 6,2 |
| Return on capital employed, % | 7,4 | 7,8 | 7,7 | 6,2 | 5,8 |
| Gearing, % | 48,9 | 45,6 | 48,9 | 45,6 | 45,4 |
| Equity ratio, % | 58,3 | 58,4 | 58,3 | 58,4 | 58,3 |
| Gross investments | 3,6 | 2,3 | 11,8 | 7,3 | 12,0 |
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Matching of alternative key figures to the closest IFRS key figure
| EBITDA AND ADJUSTED EBITDA | |||||
|---|---|---|---|---|---|
| EUR thousand | 1.7. – 30.7.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Operating profit | 8 886 | 9 207 | 27 482 | 21 749 | 27 816 |
| Depreciation and amortisation | 5 690 | 5 508 | 17 067 | 15 771 | 21 311 |
| EBITDA | 14 576 | 14 715 | 44 548 | 37 520 | 49 127 |
| Items affecting comparability | |||||
| M&A and integration related expenses | -108 | 6 | 148 | 1 905 | 1 984 |
| Redundancy payments | - | -12 | -98 | 47 | 161 |
| Additional payment for acquisition, arbitration award | - | - | - | - | 2 264 |
| Legal actions | - | 78 | - | 187 | 481 |
| Received insurance compensation | - | - | -100 | - | - |
| Total items affecting comparability | -108 | 72 | 50 | 2 139 | 4 890 |
| Adjusted EBITDA | 14 468 | 14 786 | 44 498 | 39 659 | 54 017 |
| EBIT AND ADJUSTED EBIT | |||||
| --- | --- | --- | --- | --- | --- |
| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Operating profit | 8 886 | 9 207 | 27 482 | 21 749 | 27 816 |
| Amortisation from fair value adjustments related to acquisitions | 3 148 | 3 095 | 9 489 | 9 133 | 12 252 |
| Items affecting comparability | |||||
| M&A and integration expenses | -108 | 6 | 148 | 1 905 | 1 984 |
| Redundancy payments | - | -12 | -98 | 47 | 161 |
| Additional payment for acquisition, arbitration award | - | - | - | - | 2 264 |
| Legal actions | - | 78 | - | 187 | 481 |
| Received insurance compensation | - | - | -100 | - | - |
| Total items affecting comparability | -108 | 72 | 50 | 2 139 | 4 890 |
| Adjusted operating profit | 11 926 | 12 374 | 36 920 | 33 021 | 44 958 |
| FREE CASH FLOW | |||||
| --- | --- | --- | --- | --- | --- |
| EUR thousand | 1.7. – 30.9.2021 | 1.7. – 30.9.2020 | 1.1. – 30.9.2021 | 1.1. – 30.9.2020 | 1.1. – 31.12.2020 |
| Cash flow from operating activities | 13 185 | 13 158 | 30 652 | 29 501 | 40 912 |
| Paid interest and other financing expenses | 67 | 104 | 1 223 | 1 330 | 2 593 |
| Received interest and other financing income | -12 | -4 | -54 | -29 | -50 |
| Acquisition of tangible assets and intangible assets | -3 381 | -2 284 | -12 014 | -7 280 | -10 875 |
| Free cash flow | 9 858 | 10 974 | 19 807 | 23 522 | 32 579 |
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Calculation formulas for alternative performance measures
FORMULAS FOR KEY FIGURES
| EBITDA | Operating profit + depreciation
and amortisation |
| --- | --- |
| Items affecting comparability | Material items outside the ordinary course of business that
concern i) M&A and integration-related expenses, ii)
redundancy payments, iii) compensations paid for damages, iv)
external expenses arising from significant regulatory changes
and (v) legal actions. |
| Adjusted EBITDA | EBITDA + items affecting comparability |
| Adjusted operating profit (EBIT) | Operating profit excluding amortisation from fair value
adjustments related to acquisitions + items affecting
comparability |
| Net sales from new services | Net sales of new services is calculated as net sales of those
services introduced within the past 24 months. |
| Free cash flow | Cash flow from operating activities added by paid interests and
other financing expenses, deducted by received interests and
other financing income and deducted by acquisition of tangible
and intangible assets |
| Cash conversion, % | Free cash flow
EBITDA
x 100 |
| Net debt | Interest-bearing liabilities -
Cash and cash equivalents |
| Net debt to adjusted EBITDA, x | Net debt
Adjusted EBITDA |
| Return on equity, % | Profit (loss) for the period
Total equity (average for the period)
x 100 |
| Return on capital employed, % | Profit (loss) before taxes + Financial expenses
Total assets - Non-interest-bearing liabilities (average for the
period) |
| Gearing, % | Interest -bearing liabilities -
cash and cash equivalents
x 100
Total equity |
| Equity ratio, % | Total equity
Total assets - Advances received
x 100 |
| Earnings per share, basic | Profit for the period attributable to the owners of the parent
company divided by weighted average number of shares in
issue |
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Earnings per share, diluted
Profit for the period attributable to the owners of the parent company divided by weighted average number of shares in issue, taking into consideration the possible impact of the Group’s management’s long-term incentive plan
Earnings per share, comparable
Profit for the period attributable to the owners of the parent company excluding amortisation from fair value adjustments related to acquisitions and their tax impact divided by weighted average number of shares in issue
Gross investments
Gross investments are fixed asset acquisitions with long-term effect, from which no sales of property or disposal of business have been deducted. As a general rule, fixed assets comprise tangible assets and intangible assets
Purpose of use of alternative performance measures
EBITDA, adjusted EBITDA and adjusted EBIT are presented as alternative performance measures, as they, according to the company’s view, enhance the understanding of the Group’s results of operations and are frequently used by analysts, investors and other parties.
Net sales from new products and services is presented as alternative performance measure, as it, according to the company’s view, describes the development and structure of the company’s net sales.
Free cash flow, cash conversion and gross investments are presented as alternative performance measures, as they provide, according to the company’s view, a good insight into the need’s relating to the Group’s business cash flow and are frequently used by analysts, investors and other parties.
Net debt, net debt to adjusted EBITDA, return on equity and return on capital employed are presented as alternative performance measures, as they are, according to the company’s view, useful measures of the Group’s ability to obtain financing and pay its debts, and they are frequently used by analysts, investors and other parties.
Gearing and equity ratio are presented as alternative performance measures, as they, according to the company’s view, reflect the level of risk related to financing and help to monitor the level of capital employed in the Group’s business.
Comparable earnings per share is presented as an alternative performance measure, as it, according to the Company’s view, helps to reflect the profit attributable to the owners.
Enento
Enento Group's
Interim Report 1.1. – 30.9.2021
QUARTERLY CONSOLIDATED STATEMENT OF INCOME
| EUR thousand | Q3 2021 | Q2 2021 | Q1 2021 | Q4 2020 | Q3 2020 | Q2 2020 |
|---|---|---|---|---|---|---|
| Net sales | 38 625 | 42 122 | 39 656 | 40 217 | 36 732 | 36 730 |
| Other operating income | 172 | 172 | 232 | 139 | 150 | 175 |
| Materials and services | -6 611 | -6 938 | -6 640 | -6 549 | -6 265 | -6 532 |
| Personnel expenses | -8 615 | -10 284 | -10 322 | -9 910 | -8 108 | -9 171 |
| Work performed by the entity and capitalised | 650 | 1 030 | 951 | 772 | 562 | 709 |
| Total personnel expenses | -7 965 | -9 255 | -9 371 | -9 137 | -7 545 | -8 463 |
| Other operating expenses | -9 645 | -10 199 | -9 809 | -13 063 | -8 358 | -11 205 |
| Depreciation and amortisation | -5 690 | -5 758 | -5 619 | -5 540 | -5 508 | -5 285 |
| Operating profit | 8 886 | 10 145 | 8 450 | 6 067 | 9 207 | 5 420 |
| Share of results of associated companies and joint ventures | -173 | - | - | - | - | - |
| Finance income | 48 | 6 | 301 | 21 | 4 | 6 |
| Finance expenses | -591 | -631 | -741 | -888 | -734 | -740 |
| Finance income and expenses | -543 | -625 | -440 | -867 | -731 | -734 |
| Profit before income tax | 8 170 | 9 520 | 8 011 | 5 200 | 8 476 | 4 686 |
| Income tax expense | -1 717 | -1 935 | -1 551 | -1 555 | -1 754 | -1 023 |
| Profit for the period | 6 453 | 7 585 | 6 460 | 3 645 | 6 722 | 3 663 |
| Items that may be reclassified to profit or loss: | ||||||
| Translation differences on foreign units | -1 522 | 3 184 | -5 224 | 14 498 | -2 074 | 13 691 |
| Hedging of net investments in foreign units | 369 | -813 | 1 314 | -3 349 | 456 | -3 228 |
| Income tax relating to these items | -74 | 163 | -263 | 670 | -91 | 646 |
| -1 227 | 2 533 | -4 173 | 11 819 | -1 709 | 11 108 | |
| Items that will not be reclassified to profit or loss | ||||||
| Remeasurements of post-employment benefit obligations | - | - | - | -292 | - | - |
| Income tax relating to these items | - | - | - | 60 | - | - |
| - | - | - | -232 | - | - | |
| Other comprehensive income for the period, net of tax | -1 227 | 2 533 | -4 173 | 11 587 | -1 709 | 11 108 |
| Total comprehensive income for the period | 5 226 | 10 119 | 2 287 | 15 232 | 5 013 | 14 771 |
| Profit attributable to: | ||||||
| Owners of the parent company | 6 453 | 7 585 | 6 460 | 3 645 | 6 722 | 3 663 |
| Earnings per share attributable to the owners of the parent during the period: | ||||||
| Owners of the parent company | 5 226 | 10 119 | 2 287 | 15 232 | 5 013 | 14 771 |
| Earnings per share attributable to the owners of the parent during the period: | ||||||
| Basic, EUR | 0,27 | 0,32 | 0,27 | 0,15 | 0,28 | 0,15 |
| Diluted, EUR | 0,27 | 0,32 | 0,27 | 0,15 | 0,28 | 0,15 |
Enento Group Plc
Tel. +358 10 270 7200
Hermannin rantatie 6
PO Box 16, FI-00581 Helsinki
Business ID 2194007-7
enento.com/investors