Addnode Group Annual Report 2015 | Page 33

ANNUAL REPORT Board of Directors ’ report

ANNUAL REPORT 2015

The Board of Directors and President of Addnode Group AB ( publ ), with its registered office in Stockholm and Corporate Identity Number 556291-3185 , hereby submit the Annual Report for the 2015 financial year for the Parent Company and the Group . The Annual Report covers pages 33 – 71 , and the Corporate Governance Report and Auditors ’ Report cover pages 73 – 82 . The results of the year ’ s operations as well as the Parent Company ’ s and the Group ’ s financial position are presented in the Board of Directors ’ Report along with the accompanying income statements and balance sheets , statements of comprehensive income , statements of cash flows , specifications of changes in shareholders ’ equity and supplementary disclosures and notes , which comprise the comprehensive annual report .

Board of Directors ’ Report

BUSINESS FOCUS Our business concept is to acquire , operate and develop entrepreneurdriven companies that supply software and services to markets in which we have or can achieve a leading position . We are one of Europe ’ s leading suppliers of software and services for design , construction and product data information , and a leading supplier of document and case management systems to public sector clients in Sweden and Norway .
Operations are organised in four business areas : > Design Management – IT solutions for design and construction > Product Lifecycle Management – IT solutions for product data information > Process Management – IT solutions for document and case management systems for municipal administrations and authorities > Content Management – IT solutions for public websites , collaboration solutions and customer service .
Consolidated net sales in 2015 amounted to SEK 1,900.8 m ( 1,598.6 ), an increase of 19 per cent . The increase is mainly attributable to the acquisitions carried out in 2014 and 2015 . For like-for-like units , net sales were level with the preceding year . The Group ’ s revenue from support and maintenance agreements increased by 25 per cent from 2014 to 2015 .
EBITA amounted to SEK 168.0 m ( 193.3 ), corresponding to an EBITA margin of 8.8 per cent ( 12.1 ). Earnings for 2014 included revenue of SEK 34.3 m from the revaluation of contingent consideration . Excluding this revaluation , EBITA for 2014 was SEK 159.0 m , corresponding to an EBITA margin of 9.9 per cent . Scheduled amortisation of intangible non-current assets amounted to SEK 42.1 m ( 34.8 ), and impairment of goodwill amounted to SEK 0.0 m ( 30.0 ). Operating profit was SEK 126.0 m ( 128.5 ), corresponding to an operating margin of 6.6 per cent ( 8.0 ). Through business development and acquisitions , the share of proprietary software and applications increased in the IT solutions that the Group offers its customers . In 2015 , investments in proprietary software and applications were capitalised in the amount of SEK 43.2 m ( 29.9 ).
Net sales for the Design Management business area increased , while EBITA was slightly lower than in 2014 . For Product Lifecycle Management , net sales rose sharply , and EBITA improved compared with the preceding year , mainly owing to acquisitions in 2015 . For the Process Management business area , net sales and EBITA were level with the preceding year . For Content Management , net sales were level with the preceding year , while EBITA improved .
Net financial items for the Group amounted to SEK – 1.4 m ( 1.3 ). Tax on profit for the year was SEK – 29.1 m (– 29.5 ). Profit after tax was SEK 95.5 m ( 100.2 ).
BUSINESS AREA PERFORMANCE Addnode Group ’ s operations are organised in four business areas : Design Management , Product Lifecycle Management , Process Management and Content Management .
KEY FIGURES BY BUSINESS AREA
Net sales
EBITA
Operating profit
Average number of employees
2015
2014
2015
2014
2015
2014
2015
2014
Design Management
827.7
780.5
65.8
70.3
47.0
53.6
317
306
Product Lifecycle Management
512.6
263.6
52.7
41.4
46.3
38.2
281
163
Process Management
440.3
432.6
70.0
70.9
54.4
57.5
275
275
Content Management
139.9
142.0
8.6
1.8
7.4
0.3
125
138
Central functions
10.7
9.4
– 29.1
– 25.4
– 29.1
– 25.4
7
8
Eliminations / other
– 30.4
– 29.5
34.3 , 1 )
4.3 , 2 )
Addnode Group 1,900.8 1,598.6 168.0 193.3 126.0 128.5 1,005 890
1 )
Amount pertains to the earnings effect , SEK 34.3 m , of a revaluation of contingent consideration for acquired companies .
2 )
Amount pertains to the earnings effect , SEK 34.3 m , of a revaluation of contingent consideration for acquired companies , and goodwill impairment of SEK – 30.0 m .
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