Proact: Fiscal 2Q17 Financial Results

Comment from CEO Jason Clark, Proact IT Group AB:
“I am proud to once again report a positive development in both revenues and profits. This excellent development means that we are reporting the best revenues and profits for a second quarter in the history of the company. We have also continued to improve the company’s margin throughout the quarter, compared with the same period last year, which clearly is also very pleasing to see.

“Profit before tax for the second quarter amounted to SEK 39.5 million, representing an increase of 15% compared with the corresponding period last year. Service revenues have continued to develop positively during the period and amounted to SEK 280 million, representing an increase of 7%. Service revenues relating to cloud services amounted to SEK 104 million, representing an increase of 14%. System revenues also devel- oped positively and amounted to SEK 548 million, representing an increase of 15%.

“As already reported, Proact acquired all of the shares of the German company Teamix GmbH in early January 2017. The integration has continued successfully throughout the quarter and progresses in accordance with defined integration plan. Important functions such as sales, service delivery and financial reporting are now integrated in the Proact Group. It is also pleasing to see that the German business has developed positively throughout the quarter financially.

“We are constantly working to our established strategy and defined focus areas, in order to meet the company’s objectives and financial targets. It is pleasing to see the positive effects of this work in form of a positive growth, an increased profit as well as an improved net margin. In addition we are also constantly working to develop our offering. Areas such as security, automation and applications are of increasing strategic im- portance for Proact. During the quarter we announced a cooperation with Amazon Web Services (AWS). This makes Proact part of the AWS Channel Reseller Program, which makes it possible to combine Proact’s IT services, which are based on the company’s extensive data centre experience, with Amazon Web Services’ public cloud solutions. The objective for customers is to always have the ideal solution for their IT needs, with adaptation to the requirements of the business. As a specialist, Proact can help businesses take advantage of proven technology, enabling enterprises to move between on-premise environments, Proact data centres or the AWS cloud, quickly and without risk.

“This excellent trend shows that our specialist expertise and market leading offering with regard to data centres and cloud services are very much appreciated by both new and existing customers. We have successfully implemented a number of customer projects in the above fields during the quarter.”

The second quarter in brief

• Revenue increased by 13% to SEK 830 (737) million, the organic growth equals -4%.
• EBITDA increased by 22% and amounted to SEK 57.4 (46.9) million.
• Profit before tax increased by 15% to SEK 39.5 (34.4) million.
• Profit after tax increased by 10% to SEK 30.2 (27.4) million.
• Profit per share amounted to SEK 3.21 (2.91).

The first six months in brief

• Revenue increased by 17% to SEK 1,707 (1,459) million, the organic growth equals 2%.
• EBITDA increased by 29% and amounted to SEK 111.0 (85.9) million.
• Profit before tax increased by 32% to SEK 73.5 (55.7) million. Adjusted for items affecting comparability for the first six months 2017 (SEK 5.8 million) the increase was 20%.
• Profit after tax increased by 31% to SEK 55.2 (42.2).
• Profit per share amounted to SEK 5.86 (4.45).
• Return on equity over the last 12 months amounted to 33.1% (29.7%).