“Digia’s net sales for the first quarter of 2017 totalled EUR 22.5 (21.4) million, representing growth of 5.1 per cent on the previous year. This growth was supported by good trends in the Integration and Information Management service area. Digia’s profound expertise in integration is a critical element in harnessing digitalisation and digital services. This is one of our strengths, and demand was good in this area. In Digital Services, favourable trends were seen in sales of e-commerce solutions. The launch of the National Income Register project also contributed to Digia’s net sales growth. Net sales growth was slowed down by, in particular, the postponement of several customer deliveries and certain fixed-price projects that lasted longer than expected.
The net sales of the service and maintenance business totalled EUR 11.6 (12.1) million, or 51.5 (56.5) per cent of net sales.
The net sales of the product business amounted to EUR 5.8 (6.6) million, or 25.9 (30.9) per cent of net sales. Our product business includes licence maintenance.
Digia’s operating result was EUR 0.1 (0.9) million and its operating margin (EBIT %) stood at 0.3 (4.4) per cent. The operating result fell due to a number of challenging delivery projects that were not completed to the expected schedule, and also as a result of investments in growth and recruitment that are yet to be reflected in net sales.
In order to realise our growth strategy, we are continuing to recruit professionals, particularly in the Industry Solutions and Digital Services business areas. The number of Digia employees totalled 912 at the end of March 2017, showing an increase of 40 employees or 4.6 per cent since the end of 2016. During 2017, Digia will continue to make investments in developing its competence structure to match the market situation.
I expect the favourable trends seen in the market in 2016 to continue in 2017. Our customers’ growing need to respond to the changes arising from digital transformation will boost demand for Digia’s solutions and services. On the other hand, it is hard to predict when customers will make their decisions and when major customer projects will be approved.
Our goal is to strengthen the company’s position, particularly in the growing markets for digital services, process digitalisation and the service business. Our key objective for 2017 is to accelerate our net sales growth.”
Digia Plc’s business review January–March 2017, 28 April 2017
President & CEO