DGAP-News: vwd Vereinigte Wirtschaftsdienste AG: Late-cyclical business hurts group sales and EBITDA
(firmenpresse) - vwd Vereinigte Wirtschaftsdienste AG / Half Year Results
12.08.2010 08:05
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Late-cyclical business hurts group sales and EBITDA
vwd focuses on innovations in the investment-advising process
vwd AG / half-year results / guidance
- Group sales fall to EUR 37.3 million
- At EUR 3.8 million, EBITDA drops below previous year's level
- Operating business generated in Q2 surpasses previous quarter's total
- Sales of software licenses and company's project business still remain
too weak
Frankfurt am Main, August 12, 2010 - vwd Vereinigte Wirtschaftsdienste AG,
a leading provider of financial information in Europe, reports the
following financial results for the first half of 2010:
Key financial figures:
in EUR '000 2nd Q 2nd Q 1st HY 1st HYFirst half of 2010
2010 2009 2010 2009
Sales 18,918 19,419 37,308 39,565
EBITDA 2,256 2,419 3,827 5,080
EBIT 1,171 1,466 1,649 3,258
Net income 717 852 833 1,952
Earnings per share in 0.020 0.028 0.022 0.068
EUR
The impact of the global financial crisis on the business operations of the
vwd group was much stronger in the first half of 2010 than in the previous
year. While the company has been able to boost sales and maintain earnings
levels up to this point during the financial crisis, it could not continue
this trend during the period under review due to its late-cyclical
business. Following a five-year period of growth and a nearly doubling of
sales, the vwd group suffered a decrease in both sales and earnings for the
first time.
Contract cancellations climbed somewhat higher than expected, and the
number of new contracts also failed to fulfill the company's expectations.
Above all, the company's sale of software licenses and its project business
slowed compared with the very good first half of 2009. The falloff was the
result of customers' unwillingness to add new systems. A further reason was
delays in ongoing projects. During the period of January 1 through June 30,
2010, sales fell by EUR 2,257.8 thousand (- 5.7 %) to EUR 37,307.6 thousand
(previous year: EUR 39,565.4 TEUR). The vwd group generated total sales of
EUR 37,467.5 thousand (previous year: EUR 39,661.1 thousand).
During the period under review, the financial industry continued to cut the
budgets of marketing and communication services. This trend could be only
partially offset by sales generated with new partners and the complete
consolidation of the subsidiaries acquired last year.
The earnings strength of vwd suffered during the first half of 2010.
Nonetheless, earnings before interest, taxes, depreciation, and
amortization (EBITDA) remained positive. EBITDA fell by EUR 1,253.7
thousand to EUR 3,826.7 thousand (previous year: EUR 5,080.4 thousand). The
24.7% decrease in EBITDA was caused by both lower sales and substitution
effects, in which high-margin business was replaced by low-margin business.
Even though the vwd group tried to maintain its typically high earnings
strength by taking systematic cost-management steps, depreciation,
amortization and impairments resulting from the purchase-price allocation
on companies acquired in recent years led to a decrease of EBIT. This
metric decreased by EUR 1,609.3 thousand to EUR 1,648.6 thousand (previous
year: EUR 3,257.9 thousand). Net earnings dropped by EUR 1,118.6 thousand
to EUR 833.3 thousand (previous year: EUR 1,951.9 thousand) as a result of
fictional interest expenses related to an existing put option.
Second quarter 2010
In the second quarter of 2010, the vwd group generated sales of EUR
18,917.5 thousand compared with EUR 19,418.7 thousand in the same period
last year. This amounts to a decrease of EUR 501.2 thousand (- 2.6 %). In
the first quarter, sales fell by EUR 1,756.6 thousand (- 8.7 %). As a
result, the decrease in sales slowed considerably in the second quarter of
2010 following the very difficult first quarter of 2010. Pressure also
eased on the earnings front during the second quarter. At EUR 2,256.0
thousand, EBITDA for the quarter was just EUR 162.7 thousand (- 6.7 %)
below the level of EUR 2,418.7 thousands generated in the same quarter last
year. One reason for this result was that vwd received non-recurring income
totaling EUR 402 thousand from retained dividends after the loss of rights
for certain stocks. In the second quarter of 2010, depreciation,
amortization and impairments resulting from the purchase-price allocation
amounted to EUR 433.5 thousand (previous year: EUR 309.0 thousand).
Overall, EBIT decreased by EUR 295.4 thousand (- 20.2 %), dropping from EUR
1,465.9 thousand to 1,170.5 thousand. At EUR 716.8 thousand, group net
income declined by EUR 135.4 thousand (-15.9 %) from the same quarter last
year, when a total of EUR 852.2 thousand was generated.
'The first half of 2010 did not live up to our expectations. Nonetheless,
we have created the foundation for long-term sustainable growth following
the financial crisis. We took advantage of the interval of weakness we
experienced in the period under review to set our future course. Investors'
significantly higher security needs created by the crisis will produce
completely new opportunities for the vwd group. With our newly developed
sps-sales process solution, we have created an innovative advising and
sales solution for banks and money managers that supports the entire
securities-consultation process. Our product focuses on the individual
investor's risk appetite and interests. At the same time, both banks and
money managers can efficiently carry out applicable legal requirements and
offer high-quality investment advice. As a result of our work, we have
systematically prepared the company to meet the needs of future markets,'
said Edmund J. Keferstein, Chairman of vwd's Management Board.
Business results of the company's individual segments:
Segment Market Data Solutions (MDS)
In the MDS segment, sales of market-data systems, browser-based
applications and portfolio-management solutions dropped by EUR 1,234
thousand (- 6.7 %) to EUR 17,248 thousand (previous year: EUR 18,482
thousand). In this segment, current, but lower margin license income
remained at a relatively normal level. But the first half of the year
lacked non-recurring income from the major project business. This resulted
in a decrease of segment EBITDA totaling EUR 399 thousand (-17.7 %) to EUR
1,851 thousand (previous year: EUR 2,250 thousand).
Segment Technology Solutions (TS)
In the TS segment, in which vwd offers technology and transaction solutions
as well as consulting and outsourcing assistance, business generally moved
in reverse. The transaction business also remained at a low level. Business
remained stable only in the area of provision of financial-market data to
the print media, an area where vwd is the market leader in several European
countries. While regular business in the TS segment performed normally,
non-recurring income was well below expectations as a result of a
widespread reluctance to make investments. The segment's sales fell by EUR
757 thousand TEUR (- 7.6 %) to EUR 9,225 thousand (previous year: EUR 9,982
thousand). EBITDA dropped by EUR 834 thousand (- 49.3 %) to EUR 856
thousand (previous year: EUR 1,690 thousand).
Specialised Marketing Solutions (SMS)
With its tailored, cross-media publication and communication concepts, vwd
generated sales of EUR 10,836 thousand during the first six months of the
current year, a decrease of EUR 266 thousand (- 2.4 %) than in 2009
(previous year: EUR 11,102 thousand). The large drop in sales generated by
business with mutual-fund companies could only be partially offset with new
partnerships. The segment's EBITDA fell slightly by EUR 20 thousand (- 1.8
%) to EUR 1,121 thousand (previous year: EUR 1,141 thousand).
Sales guidance for 2010
Earnings statements for this fiscal year have been filled with
uncertainties up to now. This has prevented any specific sales and earnings
guidance from being issued. The vwd group believes that the moderate
decline in business being experienced at the moment is clearly related to
particular industries and the economy and that it may last for a further
period of time. Much will depend on whether the recovery of the real
economy will be sustainable and have a positive impact on the entire
financial industry. On the basis of a cautious projection for the entire
year, it can be said that the vwd group will generate sales of about EUR 75
million and that EBITDA could total about EUR 7 million. This will mean
that the vwd group will experience a drop in sales and earnings for the
first time in five years. Nonetheless, the company believes that it is well
positioned to continue its strategy of profitable growth once the global
financial crisis has been completely dealt with.
It remains to be seen whether the financial crisis will be over for vwd in
2011 due the extensive uncertainties that exist at the moment. For this
reason, a reliable outlook for business in 2011 cannot be issued at the
moment.
Reservations concerning forward-looking statements
The press release contains forward-looking statements that reflect the
current views, expectations and assumptions of the vwd group, and that are
based on information available to the company at the time that this press
release was prepared. Forward-looking statements do not represent any
guarantee that future events or developments will in fact occur. Rather,
they contain risks and uncertainties. Actual events and developments at the
vwd group could differ materially from the expectations and assumptions
expressed here as a result of numerous factors. In particular, changes in
general business conditions, new legal regulations, the competitive
situation and developments in the financial markets could have an effect on
them.
The Interim Report 2010 can now be downloaded from the home page of the vwd
group at http://www.vwd.com/vwd/investor_relations.htm.
Profile vwd group:
vwd group is a leading workflow solution provider for the European
financial markets. The group concentrates on providing superior solutions
around the investment process for money managers, wealth managers,
advisors, media, corporate and private investors.
With the company's content, software solutions, business process
outsourcing services as well as multi-media distribution systems, it helps
its customers to make better informed decisions, increase transparency and
improve profitability. vwd's business is driven by innovation, flexibility,
customer centricity and strong commitment to local needs. For more than 60
years the group enables its customers to become more successful and provide
better service to their clients. The group's best-known brands are:
finanztreff.de, vwd fonds service, vwd market manager, vwd portfolio
manager, vwd PortfolioNet, TradeLink and Tai-Pan. With around 430 employees
in 15 locations and 5 countries vwd is a public company, listed at the
Frankfurt Stock Exchange.
Additional information:
Investor Relations
Carsten Scharf
Telephone: +49 69 50701-270
Fax: +49 6950701-114
E-mail: investorrelations(at)vwd.com
vwd Vereinigte Wirtschaftsdienste AG
Tilsiter Straße 1
60487 Frankfurt am Main
www.vwd.com
12.08.2010 08:05 Ad hoc announcement, Financial News and Press Release distributed by DGAP. Medienarchiv atwww.dgap-medientreff.deandwww.dgap.de---------------------------------------------------------------------------
Language: English
Company: vwd Vereinigte Wirtschaftsdienste AG
Tilsiter Straße 1
60487 Frankfurt am Main
Deutschland
Phone: +49 (0)69 50701-316
Fax: +49 (0)69 50701-114
E-mail: cscharf(at)vwd.com
Internet: http://www.vwd.com
ISIN: DE0005204705
WKN: 520470
Listed: Regulierter Markt in Frankfurt (General Standard);
Freiverkehr in Hamburg, München, Düsseldorf, Berlin,
Stuttgart
End of News DGAP News-Service
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Datum: 12.08.2010 - 08:05 Uhr
Sprache: Deutsch
News-ID 31980
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