Prepress

Readsoft: Interim Report January-March 2013

Friday 26. April 2013 - Continued strong license sales

Sales for January-March increased with 4 percent to SEK 162.6 (156.9) million
License revenue for January-March increased with 15 percent to SEK 42.0 (36.5) million
Operating profit EBITDA for January-March was SEK -17.6 (-11.7) million
Earnings per share after tax for January-March were SEK -0.38 (-0.27)
Cash-flow from operating activities for the period was SEK 30.4 (39.2) million
CEO comment:
Strong license growth
“The first quarter, which is typically the weakest of the year, has been a quarter with mixed results. Our growth curve continues to point upwards and our total sales grew by 8 percent in constant currencies compared to last year. It is very gratifying to see that our license sales, which are vital to a software company, continued to grow and increased by 21 percent in constant currencies compared to the corresponding period last year. The strong license growth shows that we maintain our leading position in the industry and that we keep expanding our market shares. Our cash flow from operating activities remains strong.
Another important factor for ReadSoft is our recurring revenues consisting of support and maintenance agreements, software subscriptions, and document processed in our cloud service, ReadSoft Online. The recurring revenues are a large part of our total revenue, some 40 percent, and starting as of now these revenues will be stated in our interim reports. On a rolling 12 month basis, our recurring revenues have shown an increase of 17 percent, which is important for our future revenue mix. We keep focusing on the global roll-out of our subscription model and ReadSoft online, which until now have been primarily sold in the Nordic countries.
We deliver, despite our good growth figures, an EBITDA-result that is below par. The main reason for the decreased result is a decrease in the company’s consultancy revenues. During the quarter, several customers have postponed planned projects and new orders, which we have good expectations of closing in the coming quarters. The result was also affected by non-recurring restructuring costs, which was decided on last fall. The company’s cost base is, after completion of margin improvement actions, according to plan.
Our larger markets, such as Germany, the US and UK, as well as our smaller and emerging ones, like Asia and South Africa, show the way with good growth and profitability. In the beginning of this year we reorganized the sales organization for our Oracle workflow product, creating a dedicated team working exclusively with Oracle sales on a global basis. This change has proven to be positive with a clear increase in growth. ReadSoft Online, our cloud based offering, keeps showing good growth. On the product side we launched ReadSoft Online integrated with Microsoft Dynamics AX and our cloud solution is the first of its kind that is integrated with the Windows Azure platform.
ReadSoft will continue to work for growth and an improved profit margin. Our license growth and our global business are strong, our recurring revenues good, and the development of our growth areas are positive. This shows that ReadSoft is well equipped for the future and we are optimistic about our potential for a continued good development.”