DNB extends agreement with EVRY
(Thomson Reuters ONE) -
(Oslo, 25 November 2013) EVRY has entered into an agreement with DNB to extend
the current framework agreement for delivery of IT services. The existing
framework agreement expires on 31 March 2014, and has now been extended to 31
December 2016. The extension of the agreement represents estimated contract
value for EVRY in excess of NOK 2.0 billion.
EVRY is one of a number of suppliers that are still in negotiations with DNB for
a new contract for the mainframe operation of core systems. A final decision in
respect of these negotiations is expected around year end 2013/2014.
In parallel with the extension of the framework agreement, EVRY has received
notice from DNB that DNB plans to use a different supplier for deliveries
related to a new infrastructure agreement for non-mainframe services.
In the period to 30 September 2016, EVRY's mainframe business volume will be
virtually unchanged from the current level. This will be the case regardless of
the outcome of the negotiations currently in progress. Other infrastructure
services currently provided by EVRY will run down successively, and it is likely
that conversion will take place over a period of 12-18 months starting after 1
April 2016.
The framework agreement that is being extended also includes significant
deliveries in the areas of application solutions, information services and card
services. These represent IT services that were not included in the competitive
bidding process. Accordingly, DNB will continue to be one of EVRY's largest
customers in the years ahead.
New contract structure
EVRY intends to start work on adjusting to the new contract structure with
immediate effect, and this will result in cost reductions. EVRY estimates that
the non-recurring expenses that will be incurred in connection with these
changes will be in the order of NOK 100 million, with the main effect seen in
the second half of 2014 and in 2015. The new contract structure will affect
around 300 full-time equivalent positions at EVRY. Based on its experience from
earlier restructuring processes, EVRY anticipates that a significant proportion
of the reduction in headcount will take place through normal staff turnover and
internal job mobility.
In view of the extended agreement and planned cost savings, EVRY does not expect
the new contract structure to have an adverse affect on its earnings in 2014 or
2015. In 2016, EVRY's earnings related to its customer relationship with DNB
will be NOK 50 million lower than in 2013 as a result of the new contract
structure.
EVRY's revenue from DNB will remain virtually unchanged in 2014 relative to
2013. Deliveries that are not to be continued will be affected by a successive
run-down starting in the first quarter of 2015, which is expected to result in
annual revenue in 2015 being NOK 200 million lower than in 2014. Similarly,
annual revenue in 2016 is expected to be NOK 400 million lower than in 2015.
EVRY will assess the relevant balance sheet items over the course of the fourth
quarter of 2013, but this will not have any effect on future cash flow.
This information is subject to the disclosure requirements stipulated in §5-12
of the Norwegian Securities Trading Act.
Contact persons:
Terje Mjøs, CEO EVRY, Tel: +47 06500
Eli Giske, CFO EVRY, tlf +47 908 44 189
Geir Remman, VP Corporate Communications, EVRY. Tel: + 47 970 55 017
About EVRY
EVRY is one of the leading IT companies in the Nordic countries, with a strong
local and regional presence in 50 Nordic towns and cities. Through its
knowledge, solutions and technology, EVRY contributes to the development of the
information society of the future, and so creates value for the benefit of its
customers and for society as a whole. EVRY combines in-depth industry knowledge
and technological expertise with a local delivery model and international
strength.
EVRY has some 10,000 employees, and the company is committed to demonstrating
that Nordic customers are best served by a supplier that understands Nordic
business from the inside. EVRY reports annual turnover approaching NOK 13
billion. The company is listed on the Oslo Stock Exchange and operates from
headquarters at Fornebu in Bærum, with major activities in both the Norwegian
and Swedish markets.
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: EVRY via GlobeNewswire
[HUG#1745387]
Unternehmensinformation / Kurzprofil:
Datum: 25.11.2013 - 06:55 Uhr
Sprache: Deutsch
News-ID 319779
Anzahl Zeichen: 5454
contact information:
Town:
Oslo
Kategorie:
Business News
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