Gofore Plc
Half-year Report
17 July, 2023 at 9.00 a.m. EET
Gofore Plc’s Interim Report 1 January-30 June 2023: Gofore’s organic growth continued strong, +27 %
April-June 2023
- Net sales growth continued on Q2 and organic growth stayed on a good level.
- Net sales grew by 28% and was 47.6 (37.1) million euros. Organic growth continued strong, +22%.
- Adjusted EBITA 5.4 (5.6) million euros, 11.3% of net sales.
- Strategy execution continued: private sector net sales grew by 33%, public sector net sales +25%, net sales from outside Finland +108%.
- Gofore made growth-oriented recruiting, which affected utilisation rate. There was one less working day than in the comparison period, profitability impact of which was 0.7 million euros on estimate.
- Customer pricing and salaries in balance, prices +4.5%, average salary +5.3%.
- Number of employees grew to a total of 1,396 (1,074) people. There were 70 new employees starting, and downward attrition trend continued.
- As an event after the period, Gofore acquired the entire share capital of Creanex Oy, enterprise value 5.0 million euros. The acquisition strengthens offering for digitalisation of mobile machines.
January-June 2023
- Net sales grew by 33% and were 96.7 (72.5) million euros. Organic growth continued strong, +27%.
- Adjusted EBITA 13.7 (10.7) million euros, 14.2% of net sales.
- Strategy execution continued: private sector net sales +42%, public sector net sales +27%, net sales from outside Finland +136%.
- Good ratio of customer pricing and salaries, prices up 4.1%, average salary development +3.9%.
- Number of employees grew to a total of 1,396 (1,074) people, overall capacity standing at 1,489 (1,177). Employee satisfaction improved from previous survey, and attrition decreased to 10.1%.
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 |
Q2/2023 |
Q2/2022 |
H1/2023 |
H1/2022 |
2022 |
|
Net sales |
47.6 |
37.1 |
96.7 |
72.5 |
149.9 |
|
Organic Growth of Net Sales, % |
22.0% |
27.0% |
27.1% |
25.0% |
32.2% |
|
Adjusted EBITA |
5.4 |
5.6 |
13.7 |
10.7 |
22.0 |
|
Adjusted EBITA, % |
11.3% |
15.1% |
14.2% |
14.8% |
14.7% |
|
EBITA |
5.4 |
5.6 |
13.5 |
10.2 |
20.4 |
|
Operating Profit (EBIT) |
4.5 |
4.7 |
11.6 |
8.3 |
16.6 |
|
Earnings per share (EPS), undiluted |
0.21 |
0.22 |
0.56 |
0.38 |
0.78 |
|
Earnings per share (EPS), diluted |
0.21 |
0.22 |
0.56 |
0.38 |
0.78 |
|
Number of employees at the end of period |
1,396 |
1,074 |
1,396 |
1,074 |
1,297 |
|
Overall capacity; in-house and subcontracted staff (FTE), |
1,489 |
1,177 |
1,489 |
1,177 |
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 half of the year was a great performance from Gofore in a tough market situation. On the second quarter, growth continued good, although our profitability did not quite meet our target level. All in all, we feel this is a success, credited to two things.
Firstly, Goforeans did good work every day for us to succeed. We are operatively fit and competitive. In addition to a good result, this is also a sign of us being ready for future growth. Thank you all Goforeans for a good performance.
Secondly, our strategy has shown itself to be working We have invested in making Gofore a good partner for its customers. We create strategic, long-term customer relationships. We choose customers and industries where we can add special value based on our expertise and previous experiences. Our customers have also survived a weaker economic cycle well. Thank you to our customers for trusting in us.
We continued to execute our strategy also with a new acquisition. We announced the acquisition of simulator company Creanex on 3 July 2023. Machines and other capital-intensive goods of the future are significantly more digital than today. They have more and better features, they are always cloud connected, they are increasingly tailored for their users, they are more environment friendly. While machines get increasingly complex, manufacturers find it necessary to have new products in the market faster than before.
Our expertise of virtual prototypes that will improve with this acquisition supports this in an ideal way, and we are in fact creating the kind of digital lifecycle service offering that doesn’t exist in the market yet.
The growth of our international business has continued. eMundo who joined the Gofore family last November, along with its business in the DACH area has developed as expected. Going forward, this development is supported by Creanex, with whom we also create a modern service offering that is attractive to the German industrial sector.
Our success in the talent market has also fueled our growth. There has been change in our industry, due to which we have not, however, been able to recruit quite as before. Succeeding in the talent market was before seen as the key success factor for a company. Whereas we believe the fight for talent to continue tough, also a company’s ability to succeed in its business will become necessary to attract the best talent. This is Gofore’s strength. It is important for us to succeed together and as a community. As we succeed, we create new opportunities and safety for Goforean experts. Our Crew share ownership and salary model ensure that growth and profitability are enjoyed together.
Gofore has continued its fast growth. The second quarter saw 28% of growth, out of which organic growth’s share was strong, 22%. The growth numbers were smaller than in the first quarter not only because of a strong comparison period and a more difficult market situation, but also because the quarter had one working day less.
Profitability was a bit weaker than our expectations in the second quarter, adjusted EBITA standing at 11.3%. It was partly affected by the smaller number of working days (-1). On the other hand, we did growth-oriented and expansive recruitment, resulting in a lower utilisation rate.
Based on these results, we look confidently onward to the rest of the year and further into the future. The fast digital development will continue, and we estimate that demand for Gofore’s expertise remains excellent in the mid and long term. As we see it, Finland’s new government programme also supports our efforts. Both public sector digitalisation and a wider focus on data economy and increasing R&D investments strengthen the impression. The broad and vivid discussion regarding AI is also evidence of the fact that in adopting digital technology, there is a long way to go still, both in business and in the society. We also believe that good companies will survive the current, weaker cycle of the markets.
We want Gofore to be a good company for our Crew, our customers, and owners, and the first half of the year goes to show we have again succeeded in this.”
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 |
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) |
|
April |
14.5 (11.5) |
170.6 |
1,385 (1,056) |
18 (19) |
1,293 (988) |
187 (156) |
|
May |
17.2 (13.1) |
174.2 |
1,400 (1,068) |
21 (21) |
1,311 (1,004) |
192 (163) |
|
June |
15.9 (12.5) |
176.5 |
1,396 (1,074) |
21 (21) |
1,319 (1,015) |
170 (162) |
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 January-June 2023 interim report on 19 October 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.
Mikael Nylund, CEO, Gofore Plc
tel. +358 40 540 2280
mikael.nylund@gofore.com
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 1,400 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