Gofore Plc
Interim Report
25 April, 2023 at 9.00 a.m. EET
Gofore Plc’s Interim Report January-March 2023: Gofore’s organic growth 32% and very strong 16.9% adjusted EBITA
January-March 2023
- Previous year’s Q4’s strong growth and profitability carried over to the first quarter of 2023. Adjusting recruitment to customer demand succeeded well, supporting profitability improvement.
- Net sales grew by 39% and were 49.1 (35.4) million euros. Organic growth of net sales continued strong, +32%.
- Adjusted EBITA 8.3 (5.1) million euros, 16.9%; 62% growth.
- Net sales increase from private sector customers continued its strong growth; +52%. Net sales growth from public sector customers was 30%. Net sales from outside of Finland continued very strong growth, +172%.
- Uncertainty in the macroeconomy had little impact on customer demand, and several significant agreements were made in the period.
- Ratio of customer price and salary development was excellent with prices rising 3.8%, average salary development standing at +2.2%.
- The number of employees grew to a total of 1,354 (1,043) people, overall capacity standing at 1,461 (1,123). Employee experience improved from previous survey and attrition rate was lowered to 11%.
- Devecto acquisition was finalized at the end of March. Additional purchase consideration was 4.9 million euros in total, out of which 0.2 million euros recorded as an expense; considered as an adjustment item (adjusted EBITA).
There were no significant events after the period.
The interim report is attached to this release and can be found on Gofore’s IR website at https://gofore.com/en/invest/. The report includes e.g. the most significant new agreements, an extensive key figure table, profit and loss statement and balance sheet, as well as Gofore’s market outlook and near-term risks. This report is an IAS34 compliant interim report. The numbers are unaudited.
Key figures
|
Group Key Figures Summary, MEUR |
Q1/2023 |
Q1/2022 |
2022 |
|
Net sales |
49.1 |
35.4 |
149.9 |
|
Organic Growth of Net Sales, % |
32.4% |
22.9% |
32.2% |
|
Adjusted EBITA |
8.3 |
5.1 |
22.0 |
|
Adjusted EBITA, % |
16.9% |
14.4% |
14.7% |
|
EBITA |
8.1 |
4.5 |
20.4 |
|
Operating Profit (EBIT) |
7.1 |
3.6 |
16.6 |
|
Earnings per share (EPS), undiluted |
0.34 |
0.16 |
0.78 |
|
Earnings per share (EPS), diluted |
0.34 |
0.16 |
0.78 |
|
Number of employees at the end of period |
1,354 |
1,043 |
1,297 |
|
Overall capacity; in-house and subcontracted staff (FTE), at the end of period |
1,461 |
1,123 |
1,383 |
Unless otherwise stated, comparing figures refer to the corresponding period of the previous year. Devecto Oy’s figures have been consolidated with Gofore Group’s numbers as of 3 January 2022, and eMundo GmbH’s figures as of 1 November 2022.
Organic growth is defined by comparing the quarterly net sales in the Group income statement with the net sales of the previous reporting period’s corresponding quarter. The growth is calculated with a comparable Group structure using the Group structure of the time of reporting to calculate pro forma net sales for the corresponding period. The pro forma net sales include the impact of acquisitions and divestments retroactively and it is unaudited.
CEO Mikael Nylund:
“The first quarter of 2023 was an excellent one. Our growth continued as very strong. As for our organic growth, we kept the same high level. We also continued a positive trend in profitability, with an excellent ratio of price and salary development. This shows not only strong operational performance, but also that we have successfully scaled our operations and benefitted from the higher volumes.
Considering the uncertainty of our operating environment, the Gofore team’s performance was even better than expected. For example, the racing inflation, geopolitical tension and the radical change of interest rates have been visible in Finland, Europe and as a wider petering out of economic growth. This reflects on Gofore’s customers variably, depending on e.g. the industry they represent and the cyclicity of their business. In our view, the willingness and need to invest in the future has, however, not fundamentally suffered.
We see strong faith and investment in a future that is even more digital than before on the sectors important to Gofore, Digital Society and Intelligent Industry. The most significant collaborations and agreements of January-March can be found on this report.
During the quarter, we communicated having slowed down recruitment in certain expertise areas. In this market situation, talent profile demands vary. For example, needs for experts in project and change management are on their previous levels, whereas customers weigh their decisions more when it comes to software designers. As always, Gofore finds it important to react to changes in demand fast. From this setup, we recruited 99 new Goforeans in January-March.
The changed market situation is also visible in the talent market. Talent availability has improved in certain expertise areas, and the growth bottleneck has shifted from talent availability to customer demand. This setting favors consultancy companies like us, who have invested in strong customer relationships and building partnerships with their clientele. We don’t, however, expect the talent market to be relieved in the long term. We continue investing in developing our employer experience, to be an exemplary employer now and in the future.
Our rising employee net promoter score and decreasing attrition rate are signs of the hard work that has already been put into this. A high ratio of participants in the 6th period of Gofore’s share saving plan, 53%, is also a sign of employee commitment.
German-speaking Europe, the DACH area, is a center of our growing attention, as our business there develops and grows. Integrating eMundo, who joined us last November, has shown promise. It has been great to see how excited the Emundis are about our collaboration prospects and how organically similar teams start to mix and learn from each other!
During the spring, Finland joined NATO. The economy is predicted to return to a growth curve at the end of the year in both Finland and Europe. Finland just had its parliamentary elections, and a new government is being formed. We believe our operating environment to continue as favorable, especially in a long-term view.
Gofore continues on its chosen strategic path. We continue to work for growth also across the weaker economic cycle, while making sure we remain profitable.”
Monthly net sales development in 2023
The numbers are unaudited.
|
Month |
Net sales, |
Pro forma LTM net sales 2 |
Number of employees 3 |
No. of workdays in Finland |
Overall capacity, |
Subcontracting, FTE 5 |
|
January |
15.8(10.8) |
160.6 |
1,318 (993) |
21 (20) |
1,225 (917) |
186 (147) |
|
February |
15.3 (11.3) |
164.2 |
1,342 (1 015) |
20 (20) |
1,256 (942) |
184 (153) |
|
March |
18.1 (13.3) |
168.0 |
1,354 (1 043) |
23 (23) |
1,271 (968) |
189 (155) |
Unless otherwise stated, comparing figures refer to the corresponding period of the previous year. Devecto Oy’s figures have been consolidated into Gofore Group’s figures as of 3 January 2022 and eMundo GmbH’s figures as of 1 November 2022.
1) Net sales, MEUR indicates the unaudited net sales for the month in question.
2) The last twelve months (LTM) pro forma net sales figure that the company uses tells the net sales for the Group structure of the time of reporting. The pro forma net sales include the impact of acquisitions and divestments retroactively and is unaudited.
3) Number of employees at the end of the review period.
4) Overall Capacity, FTE (Full Time Equivalent) figure shows the overall capacity of the Group’s personnel, converted into a value corresponding to the number of full-time employees. The figure includes the entire personnel, regardless of their role. The figure is not affected by annual leave, time-off in lieu of overtime, sick leave or other short-term absences. Part-time agreement sand other long-term deviations from normal working hours reduce the amount of overall capacity in comparison with the total number of employees. The personnel capacity of corporate acquisitions has been accounted for as of the date of the acquisition.
5) Subcontracting, FTE (Full Time Equivalent) figure shows the overall amount of subcontracting used in invoiceable work, converted into a value corresponding to the number of full-time employees. The subcontracting of the companies acquired by Gofore has been accounted for as of the date of the acquisition.
Next financial disclosure
Gofore’s next financial disclosure will be the half-year report 2023 on Monday, 17 July 2023. Gofore also publishes monthly business reviews for the months that are not included in interim or half-year reports, in the beginning of the following month.
Contacts
- Mikael Nylund, CEO, Gofore Oyj, +358 40 540 2280, mikael.nylund@gofore.com
About Gofore Oyj
Gofore is an international digital transformation consultancy with Finnish roots. We have over 1,300 impact-driven people in 19 locations across Finland, Germany, Austria, Spain, Estonia and Italy. With our technology and business expertise we build an equal digital society and create sustainable solutions for the intelligent industry. Our diverse group of professionals shares a pioneering ambition to create a more humane, sustainable and ethical digital world. Our values guide our business: Gofore is a great workplace that thrives on customer success. In 2022, our net sales amounted to EUR 149.9 million. Gofore Plc’s share is listed on the Nasdaq Helsinki Ltd. in Finland. Our vision is to be the most significant digital transformation consultancy in Europe. Learn to know us better at gofore.com