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Presentation of consolidated results of the Sygnity Group for H1 2009 Warsaw, 1 September 2009 Disclaimer This presentation has been prepared solely for information purposes. It is not an advertisement or an offer of securities in public circulation. The information sources used in it are considered by Sygnity reliable and precise, however, there is no guarantee that the information is exhaustive and that it fully reflects the factual circumstances. The presentation may contain future statements which pose an investment risk or a source of uncertainties, and may considerably differ from factual results. Sygnity SA shall not be held liable for the effects of decisions made based on this presentation. All liability is borne by the user of this presentation. The presentation is subject to protection pursuant to the Copyright and Neighbouring Rights Act. Copying, publishing or dissemination of the presentation requires a prior written consent of Sygnity SA. 2 Results for Q2 2009/Q2 2008 and H2 2009/H1 2008 [PLN ‘000] Q2 2009 Q2 2008 H1 2009 H1 2008 Revenues 141 149 272 238 281 525 481 020 Operating profit (loss) (85 398) (1 016) (101 523) (25 860) Net profit (loss) (75 385) 1 629 (92 364) (24 666) Factors influencing the results: Effects of the economic downturn Slump in revenues from sales of infrastructure and equipment Write-offs in the amount of PLN 66 300 000 Final stage of execution or settlement of several unprofitable projects concluded in the years 2004-2006 3 Revenues in Q2 2009/Q2 2008 and H1 2009/H1 2008 by sectors Sector [PLN ‘000] Q2 2009 Q2 2008 H1 2009 H1 2008 Public 35 448 138 611 77 125 237 902 Banking and finance 35 064 60 314 78 329 115 020 Utilities 33 674 16 774 54 819 28 063 Telco-Industry 38 088 56 314 69 241 100 372 Others and exemptions (1 125) 225 2 011 (337) 141 149 272 238 281 525 481 020 Total Factors influencing the results: Lack of large infrastructural orders in the public sector (in the previous year, among others, the Police, MEN – result of a savings program in public administration) In the banking sector: reduction of IT expenses, reduction of the scale of operations of some banking institutions 4 Sales structure in H1 2009 vs H1 2008 Revenues [PLN ‘000] 39% Goods and materials 19% Products and services 61% 81% 5 Write-off structure in Q2 2009 – PLN 66.3 million Unprofitable projects (PLN 38.3 million) – provisions for costs related with execution of unprofitable long-term contracts concluded mainly in the years 20042006, legislative changes concerning certain projects and contractual penalties Overdue receivables (PLN 11.4 million) – write-offs for contested receivables and receivables overdue for over 6 months, payment backlogs observed on the market Stocks (PLN 10 million) – overestimated and realigned value of stocks, licences and copyrights, resulting partially from contractors’ withdrawal from planned purchases Provisions for holiday pay and bonuses (PLN 5.7 million) – bonuses and holiday in H1 2009 Others (PLN 0.9 million) – other provisions, mainly costs following the balance sheet date 6 Indebtedness [PLN ‘000 000] 31.03.2009 30.06.2009 31.08.2009 Loans -25 -25 -47 Bonds -64 -70 -37 36 39 21 -53 -56 -62 Cash cash in an escrow account Net indebtedness* * without cash in an escrow account intended for contracts 7 Savings program Launch of a two-stage savings program. Stage I: Q3 - Q4 2009, Stage II: Q4 2009 – Q1 2010 Reducing the number and costs of subcontractors Simplifying the Group’s structure Employee lay-off Freezing temporarily salaries and bonus systems Reducing temporarily the working time and unpaid holiday Stage I Stage II etap II Closing unprofitable production lines Abandoning some activities Reducing temporarily fixed monthly salaries I etap 8 Backlog 2009 Sector Portfolio of orders 2009 [PLN ‘000] Banking and Finance 132 206 Public 147 662 Telco-Industry 115 251 Utilities Other sales Total 88 639 3 670 487 429 Portfolio of orders for the years 2010-2011 amounts at present to over PLN 130 million 9 Prospects in 2009 Revenues of approximately PLN 700 million – lower revenues result from the economic downturn (public, banking and telco-industry sectors) Anticipated operating profit in H2 at the level of PLN 20 million (approximately PLN 17 million following amortization) New strategy of the Group in Q4 2009 First significant agreements on provision of service activities in western Europe 10