Aug 30, 2016

USU Software AG confirms revenue and earnings guidance for 2016 after strong business performance

  • Figures for the first half of 2016 fully on track
  • Revenue and earnings guidance confirmed
  • Revenue growth of 7.7% in Q2 2016 compared with the previous year
  • Adjusted EBIT up 7.9% year-on-year in Q2 2016

USU Software AG (ISIN DE000A0BVU28) lifted its revenue (IFRS) by 13.7% year-on-year to EUR 34,031 thousand in the first six months of the 2016 fiscal year (Q1-Q2 2015: EUR 29,925 thousand). All of USU AG’s business segments and the subsidiaries of the Group (hereinafter referred to as “USU” or the “USU Group”) contributed to this result in equal measure. The Product Business and Service Business segments each expanded by 14%. USU’s license revenue rose by 3.4% year-on-year in the first half of 2016 to EUR 5,428 thousand (Q1-Q2 2015: EUR 5,251 thousand). Maintenance business including SaaS revenue contributed a total of EUR 9,376 thousand (Q1-Q2 2015: EUR 7,657 thousand) to consolidated revenue, an increase of 22.4% compared with the previous year. The USU Group’s revenue generated outside Germany receded slightly by 4.7% in the reporting period to EUR 9,447 thousand (Q1-Q2 2015: EUR 9,909 thousand) because several larger orders were postponed until the third quarter. The share of consolidated revenue generated outside Germany accordingly fell to 27.8% from 33.1% in the first two quarters of the previous year.

In the first six months of 2016, the significant expansion of revenue combined with a comparably moderate increase in costs raised the USU Group’s earnings before interest, taxes, depreciation and amortization (EBITDA) by 10.0% against the prior-year period to EUR 3,895 thousand (Q1-Q2 2015: EUR 3,541 thousand). After deducting depreciation and amortization of EUR 1,301 thousand (Q1-Q2 2015: EUR 1,083 thousand), USU reported a 5.6% increase in earnings before interest and taxes (EBIT) in the same period to EUR 2,594 thousand (Q1-Q2 2015: EUR 2,458 thousand). After tax expense of EUR 292 thousand (Q1-Q2 2015: EUR 300 thousand) is deducted, consolidated net profit (IFRS) in the first half of 2016 amounted to EUR 2,258 thousand (Q1-Q2 2015: EUR 2,373 thousand). This represents a slight decrease of 5.1% on the profit for the prior-year period. Earnings per share thus declined from EUR 0.23 in the previous year to EUR 0.21 in the reporting period.

USU lifted its earnings before interest and taxes adjusted for extraordinary effects relating to acquisitions (adjusted EBIT) in the first six months of 2016 by 15.0% year-on-year to EUR 3,328 thousand (Q1-Q2 2015: EUR 2,894 thousand). At the same time, USU expanded its adjusted consolidated net profit by 7.2% compared with the first half of 2015 to EUR 2,970 thousand (Q1-Q2 2015: EUR 2,771 thousand). USU’s adjusted earnings per share accordingly increased from EUR 0.26 in the previous year to EUR 0.28 in the reporting period.

Broken down by segment, the Product Business contributed a total of EUR 26,576 thousand (Q1-Q2 2015: EUR 23,318 thousand) to consolidated revenue in the first six months, 14.0% more than in the previous year. Here, USU benefited in particular from the substantial expansion of its consulting and maintenance business, which includes the SaaS revenue. The Service Business segment also recorded strong growth, boosting its revenue by 14.3% to EUR 7,334 thousand (Q1-Q2 2015: EUR 6,416 thousand). As a result, the share of consolidated revenue attributable to the product segment remained virtually constant in the reporting period at 78.1% (Q1-Q2 2015: 77.9%).

A look at business performance in the second quarter of 2016 shows that the USU Group succeeded in continuing the positive trend seen in preceding quarters. With consolidated revenue of EUR 17,074 thousand (Q2 2015: EUR 15,856 thousand), the company in conjunction with its subsidiaries generated organic revenue growth of 7.7% compared with the same quarter of the previous year. This was chiefly due to the strong consulting business, which benefited from a high level of orders on hand and improved capacity utilization.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was almost on a level with the previous year at EUR 2,242 thousand (Q2 2015: EUR 2,253 thousand). On account of a positive extraordinary effect in the previous year, earnings before interest and taxes (EBIT) declined from EUR 1,715 thousand in the second quarter of 2015 to EUR 1,585 thousand, a decrease of 7.6%. At EUR 1,376 thousand, the USU Group’s consolidated net profit (IFRS) was down 4.7% on the prior-year figure (Q2 2015: EUR 1,444 thousand). This gives earnings per share of EUR 0.13 (Q2 2015: EUR 0.14).
Adjusted earnings before interest and taxes (adjusted EBIT) developed encouragingly, rising by 7.9% in the second quarter of 2016 to EUR 1,960 thousand (Q2 2015: EUR 1,817 thousand). Adjusted consolidated net profit came to EUR 1,740 thousand (Q2 2015: EUR 1,546 thousand), which corresponds to growth of 12.5% compared with the year-earlier period. Adjusted earnings per share remained flat at EUR 0.14.

In spite of the dividend payment of EUR 3,683 thousand and within the scope of increasing consolidated net profit, the Group’s liquidity as of June 30, 2016 was only marginally lower at EUR 21,840 thousand (December 31, 2015: EUR 23,109 thousand). Based on total assets of EUR 87,082 thousand (December 31, 2015: EUR 89,186 thousand), the equity ratio was 68.2% as of June 30, 2016 (December 31, 2015: 68.2%). This puts the USU Group on a sound financial footing, as before.

On the back of the positive business performance in the first half of 2016, the Management Board is confirming the guidance for the USU Group of an increase in revenue to EUR 71–75 million for the current fiscal year (2015: EUR 66.1 million) together with a strong rise in adjusted EBITDA, a key earnings ratio, to between EUR 9 and EUR 10.5 million (2015: EUR 8.79 million). Moreover, by the end of 2017, revenue is expected to increase to over EUR 100 million, including around EUR 15 million in growth through acquisitions, with further expansion in the operating margin on the basis of adjusted EBIT.



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