ALDATA SOLUTION INTERIM REPORT JANUARY - DECEMBER 2005 (unaudited)

Tuesday, 14. February 2006 09:15

Aldata in 2005 (IFRS)

* Net sales grew by 27% to EUR 76.0 million (EUR 66.1 million,
comparable EUR 59.8 million). The most significant growth took
place in product sales.
* Gross profit grew by 36% to EUR 63.1 million (comparable EUR 46.5
million) .
* Operating profit, EBIT, was EUR 5.2 million, a EUR 9.9 million
comparable increase.
* Profit before taxes was EUR 5.5 million (EUR -1.0 million).
* Net profit was EUR 3.4 million (EUR -4.0 million) and earnings per
share, EPS, were 0.050 (-0.059) euros.
* Order backlog at year end was EUR 20.7 million (EUR 18.0 million at
end of 2004 and EUR 18.9 million at end of Q3 2005).
* Cash-flow from operating activities was EUR 4.5 million (EUR -4.2
million) and cash and cash equivalents at year end were EUR 9.4
million (EUR 6.5 million at end of 2004 and EUR 5.2 million at end
of Q3 2005).

Comparable figures have been adjusted in relation to the divestment
of Aldata Industries Oy, which was sold in December 2004.

Aldata in Q4 2005 (compared to Q4 2004)

The quarterly numbers are prepared according to Finnish accounting
standard (FAS).

* Net sales increased 28% to EUR 21.3 million (EUR 18.1 million,
comparable EUR 16.7 million).
* Gross profit increased 39% to EUR 18.2 million (EUR 17.7 million,
comparable EUR 13.1 million).
* Operating profit, EBIT was EUR 2.1 million (EUR 3.5 million,
comparable EUR -0.4 million).
* Profit before taxes was EUR 2.0 million (EUR 3.4 million).
* Net profit was EUR 1.4 million (EUR 0.3 million) and earnings per
share, EPS, were 0.021 (0.004) euros.


Market overview

During 2005, an improvement in the application software market
became more visible. Companies are investing in tools to improve
their efficiency and the demand for business software has steadily
increased.

In the retail and logistics verticals, where Aldata's focus is, the
penetration of standard application software is still at a low
level. An increasing number of retail chains and logistics
companies are contemplating a move from proprietary IT systems to
packaged solutions. Aldata, being one of the very few suppliers of
such solutions, is to benefit strongly from this trend.

The increased activity in the retail and logistics verticals has
attracted also large, diversified software vendors to enter the
area. This has resulted in a consolidation among Aldata's
competitors and peers. However, Aldata's long experience and deep
knowledge within these verticals and strong track-record of
successful implementations with the world's leading retailers, give
confidence for the future.

In 2005 Aldata grew significantly faster than its competitors and
peers. Aldata expects to continue gaining market share in all its
markets.

January - December 2005 financial performance (IFRS)

Aldata's net sales were EUR 76.0 million (EUR 66.1 million,
comparable EUR 59.8 million), which represents organic growth of
27% over the previous year's comparable net sales (comparable
figures exclude Aldata Industries Oy, which was divested in
December 2004). The growth was strongest in the US and the UK.
France and Finland were the largest geographical markets,
representing 31% and 13% of total net sales.

Product sales, which include licenses on standard products,
licenses on customer specific developments and maintenance
revenues, accounted for 42% (35%). Consulting services, which
include project work, integration and training services accounted
for 51% (49%). Third party licenses and hardware accounted for 7%
(16%).

The Group's gross profit was EUR 63.1 million (comparable EUR 46.5
million), which represents an 83% (78%) gross margin. The increase
in the gross margin is attributable to an improved sales mix.

Operating profit, EBIT, totaled EUR 5.2 million (comparable EUR
-4.7 million), which represents a 6.9% operating margin. The strong
growth in operating profit proves that Aldata's business model
brings significant scale benefits as the net sales increase.

Pre-tax profit was EUR 5.5 million (EUR -1.0 million), net profit
was EUR 3.4 million (EUR -4.0 million) and earnings per share, EPS,
were 0.050 euros (-0.059 euros).

Research and developments costs in the financial year totaled EUR
16.4 million (EUR 15.2 million), of which EUR 0.6 million (EUR 0.4
million), or 3.9 %, were capitalized. The depreciation on
capitalized development costs was EUR 0.1 million (EUR 0.0
million). Before 2004 all development costs were booked as
expenses.

Costs related to stock options were EUR 0.5 million (EUR 0.2
million).

The operating costs also include a EUR 0.4 million non-recurring
item related to the change of Aldata Group's President and CEO.

Taxes for the financial year were EUR 2.0 million (EUR 3.0 million)
and tax rate was 36%.

Aldata's reported order backlog includes product and third party
product sales, which will be recognized as revenues during the
following twelve months. At year-end 2005 Aldata's order backlog
was EUR 20.7 million (EUR 18.0 million at the end of 2004 and EUR
18.9 million at the end of Q3 2005).

Fourth quarter 2005 financial performance

All presented quarterly numbers are prepared according to Finnish
accounting standard (FAS) and comparable figures are fourth quarter
2004 figures.

Aldata's net sales were EUR 21.3 million (EUR 18.1 million,
comparable EUR 16.7 million), which represents comparable growth of
27% (comparable figures exclude Aldata Industries Oy, which was
divested in December 2004).

Product sales, which include licenses on standard products,
licenses on customer specific developments and maintenance
revenues, accounted for 45% (38%). Consulting services, which
include project work, integration and training services accounted
for 48% (46%). Third party licenses and hardware accounted for 7%
(16%).

The Group's gross profit was EUR 18.2 million (EUR 17.7 million,
comparable EUR 13.1 million). Operating profit, EBIT, totaled EUR
2.1 million (EUR 3.5 million, comparable EUR -0.4 million). Net
profit was EUR 1.4 million (EUR 0.3 million) and earnings per
share, EPS, were 0.021 (0.004) euros.

Net sales of the Supply Chain Management (SCM) Software business
unit grew by 40% to EUR 18.2 million (EUR 13.0 million). The gross
profit was EUR 15.7 (EUR 10.1) million and the operating profit,
EBIT, was EUR 1.8 (EUR 0.3) million.

Net sales of the In-Store Software business unit decreased to EUR
3.1 million (EUR 3.6 million). The gross profit was EUR 2.5 million
(EUR 3.0 million) and the operating profit, EBIT, was EUR 0.3 (EUR
0.0) million.

Finance and investments

At the end of 2005 Aldata Group's cash, cash equivalents and
marketable securities amounted to EUR 9.4 million (EUR 6.5 million
at the end of 2004) and the balance sheet total stood at EUR 48.5
million (EUR 40.6 million). The Group had EUR 0.3 million
interest-bearing debt (EUR 0.2 million) and interest-bearing net
liabilities totaled EUR -8.7 million (EUR -6.0 million). Short-term
receivables totaled EUR 26.9 million (EUR 22,2 million). The
Group's solvency ratio was 54.1% (54.0%), gearing was -34.4%
(-27.6%), and shareholders' equity per share was EUR 0.372 (EUR
0.317).

The Group's capital expenditure on hardware and software purchases
amounted to EUR 1.3 million (EUR 1.1 million). A total of EUR 0.6
million (EUR 0.3 million) development costs were capitalized during
the period.


IFRS reporting

Aldata transferred to reporting according to International
Financial Reporting Standards (IFRS) in 2005. The comparative 2004
full-year figures in this report are according to IFRS. Preliminary
information of the changes was published on January 31st, 2006.





Profit and loss figures in 2005 and 2004 according to IFRS and
FAS:


2005 2005 2005 2004 2004 2004
FAS Adj. IFRS FAS Adj. IFRS

Net sales 75.6 0.4 76.0 66.0 0.1 66.1
Gross Profit 63.0 0.1 63.1 53.9 -0.1 53.8
Operating Profit, EBIT 4.5 0.7 5.2 -1.5 0.7 -0.8
Profit before taxes, EBT 4.8 0.7 5.5 -1.6 0.6 -1.0
Net Profit 3.1 0.3 3.4 -4.8 0.8 -4.0


The essential differences between FAS and IFRS are in net sales,
capitalization of product development expenses, share option
expenses and goodwill amortization.

Net sales has increased EUR 0.4 (EUR 0.1) million as items
previously recorded under other operating income are in IFRS
accounting recorded as net sales.

The capitalization of development costs were EUR 0.6 (EUR 0.4)
million and the depreciation of these expenses was EUR 0.1 (0.0)
million.

The impact of share option expenses is included in personnel
expenses in the profit and loss statements and it reduces the 2005
operating profit EUR 0.5 (EUR 0.2) million.

The amount of scheduled amortization in FAS has been adjusted in
the IFRS-compliant profit and loss account and it improves the
operating profit EUR 0.7 (EUR 0.8) million. The company's goodwill
is regularly tested according to IFRS impairment test guidelines.

Business units

Net sales of the Supply Chain Management (SCM) Software business
unit grew by 35% to EUR 64.1 million (EUR 47.3 million). The gross
profit was EUR 53.6 (EUR 32.6) million and the operating profit,
EBIT, was EUR 7.0 (EUR -2.9) million. The positive development of
the business unit is attributable to a number of successful Aldata
G.O.L.D. implementations and to the launch of a number of new
G.O.L.D. modules. The unit has been very successful in its
international expansion and the strongest growth has taken place in
Asia and the US. There is a continued focus on international
expansion and the strongest growth in 2006 is expected from the
growing markets of Asia, Middle-East, Russia, China and the US.
Parallel to the international expansion the unit is launching new
products, to fulfill the ever increasing requirements by its
customers. All new products are based on Aldata G.O.L.D. technology
and are integrated modules of the G.O.L.D. suite, which already
today represents the most comprehensive offering on the market for
supply chain execution.

Net sales of the In-Store Software business unit decreased to EUR
11.9 million (EUR 12,5 million). The gross profit was EUR 9.6
million (EUR 9.7 million) and the operating profit, EBIT, was EUR
0.0 (EUR 0.1 ) million. In Finland, the In-Store unit has been
significantly increasing its sales and has further strengthened its
leading position as a supplier of point-of-sales solutions for
Finnish retail chains. Also in terms of profitability, the Finnish
unit has performed very well and restructuring measures taken at
the end of 2004 have significantly improved the efficiency of the
unit. However, performance in rest of the Nordic region has been
weaker than expected, but towards the end of 2005, the performance
in this area has improved as well.

According to IFRS unallocated expenses are reported separately from
segment reporting. In 2005 Aldata Group's unallocated expenses
totaled EUR 1.8 million (EUR 1.9 million).


Research and Development

Aldata's research and development costs were EUR 16.4 million (EUR
15.2 million), which is 22 (23%) percent of net sales. Costs grew
by 7.7 per cent during the year. A total of EUR 0.6 million (EUR
0.4 million) of development costs were capitalized during the
period. The depreciation on capitalized development costs was EUR
0.1 million (EUR 0.0 million). Before 2004 all research and
development costs were booked as expenses.

At the end of the review period 211 (189) employees were involved
in R&D activities, which represents 36% of the Group's total
personnel. Aldata's R&D centers are located in Paris, France, and
in Vantaa, Finland.

Personnel

Aldata Group employed 580 (514) persons at the end of 2005 and on
average had 547 (525) employees during the year. The personnel
growth rate was 20% in the Supply Chain Management Software
business unit, whereas the number of personnel declined by 4% in
the In-Store Software business unit. Geographically, the growth was
strongest in Aldata subsidiaries in the US and the UK.


By Business Units Dec 31, 2005 Dec 31, 2004
Persons % Persons %
SCM Software 471 81 394 77
In-Store Software 99 17 104 20
Group administration 10 2 16 3
Total 580 100 514 100



Approximately 53% of personnel were employed by Aldata companies in
France, 14% in Finland, 13% in Germany, 8% in Sweden, 5% in
Slovenia, 4% in the US and 3% in the UK.

Aldata share

The highest price of the Aldata Solution Oyj share during January -
December 2005 was 2.07 EUR and the lowest price 1.07 EUR. The
average price was 1.56 EUR and the closing price 1.85 EUR. The
trading volume on the Helsinki Stock Exchange was EUR 69.3 million
and altogether 44.2 million shares were traded, which represents
65.6% of the shares. Aldata Solution Oyj has 67.4 million shares
outstanding. The number has remained unchanged during the period.

The number of shareholders was 5886 and the free float was 99.7% of
the share capital at the end of September 2005. A total of 51.7% of
Aldata Solution Oyj's shares were nominee registered at the end of
the period.

Events after the review period

On January 2nd 2006, Aldata announced an agreement with Carrefour,
the second largest retailer worldwide, regarding the supply of the
Aldata G.O.L.D. software suite to Carrefour's 179 hypermarkets in
France.

On January 9th 2006, Aldata announced an agreement with the United
Supermarkets from the US, regarding the supply of the full suite of
Aldata G.O.L.D. applications for its stores in North and West
Texas.

The Board of Directors' dividend proposal
The Board of Directors will propose to the Annual General Meeting
on April 6th that no dividend shall be distributed. The Board's
opinion is that profits should be re-invested in Aldata's business
operations, where they can generate high returns and support an
aggressive growth strategy. Also, financial flexibility opens up
opportunities for Aldata in the currently very fast developing and
actively consolidating retail software market.

Outlook for 2006
Aldata expects its good financial performance, strong growth in net
sales and increased profitability, to continue also in 2006. The
growth on net sales is supported by new product launches, the
improved market environment and increased presence in Asia,
Latin-America, Middle-East and in the US. The increase in profit
margins is supported by Aldata's business model, where significant
scale benefits are realized as net sales increase.



This report has been prepared according to IFRS (International
Financial Reporting Standards).
The quarterly figures are presented according to FAS (Finnish
Accounting Standard).


Helsinki, February 14, 2006

Aldata Solution Oyj

Board of Directors

The audited financial report will be published in Finnish and
English on the Group's web site
www.aldata-solution.com week 10. The printed English version of
Annual Report will be published week 14.
Further information:
Aldata Solution Oyj, René Homeyer, President and CEO, tel. +33 683
810 888
Aldata Solution Oyj, Thomas Hoyer, CFO, tel. +358 45 670 0491
Aldata will arrange a press conference for media and financial
analysts in Helsinki on 14th February, at 12.00 (EET) in Hotel
Simonkenttä (Simonkatu 9, 00100 Helsinki) in the Espa cabinet on
the ground floor.
The presentation material will be published on the Group's web site
www.aldata-solution.com

Aldata in brief
Aldata Solution is one of the global leaders in supply chain
execution software for retail, wholesale and logistics companies.
The company's comprehensive range of Supply Chain Management and
In-Store solutions enable its more than 300 customers across 50
countries to enhance productivity, profitability, performance and
competitiveness. Aldata develops and supports its software through
more than 500 Aldata professionals and a global partner network.
Aldata is a public company quoted on the Helsinki Stock Exchange
with the identifier ALD1V. More information at:
www.aldata-solution.com
Distribution:
OMX Helsinki Stock Exchange
Media

APPENDICES
1 Consolidated Income Statement
2 Consolidated Balance Sheet
3 Consolidated Cash Flow
4 Commitments and Contingencies
5 Key Figures
6 Segment report

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Author:
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