First half year results 2014

May 21, 2014 - Breukelen, the Netherlands

TIE KINETIX announces solid performance in SaaS revenue and integration of TFT in H1, 2014

First half year results (period Oct, 1, 2013 – March 31, 2014).

• Acquisition and integration of TFT completed
• CSP rebranded as modular Demand Generation solution
• Loss of C-Net revenue in 2013 (H1 2013 € 310k) almost fully recovered through sales of the modular Demand Generation Solution
• Total revenue increased by 26,5% to € 9.438k (H1 2013: € 7.497k)
• SaaS and hosting revenues grew 34,9% to € 3.334k (H1 2013: € 2.471k)
• EBITDA before acquisition costs and one-time costs amounts to € 893k (H1 2013: € 761k)
• EBITDA impacted by acquisition costs (€ 345k) and one-time costs (€ 305k)
• Net profit before acquisition costs and one-time costs increased 26,4% to € 412k (H1 2013: € 326 k)

TIE Kinetix, the leading provider of cloud-managed Business Integration, Analytics, Demand Generation and E-Commerce services today released interim results for the first half year of its fiscal 2014. The company started the year 2014 with the acquisition and integration of the German company Tomorrow Focus Technologies GmbH (“TFT”), which was completed on December 2nd, 2013. In this report the results of TFT have been included as from that date. Acquisition costs amounted to € 345k and have been reported under Professional Services in the Profit & Loss statement.

Revenue
With the acquired TFT activities total revenue for the first half year amounted to € 9.483k. Demand for Integration and E-Commerce solutions were robust. In response to a growing market for Demand Generation products, the company has launched the initiative to provide this solution in a modular approach to the market. The first results are promising, as the loss of C-net revenue last year has almost completely been recaptured. The following highlights the developments in our four business lines:

• Business Integration: our solution is well positioned in the telecom, publishing, do-it-yourself, food retail and automotive industries. In the first six months we have a.o. concluded contracts with customers Revlon, Nutricia, Sodexo, V&D, Royal Canin and Bugaboo. The strength of our offering is now reflected in a position in Gartner’s new Magic Quadrant for Integration Brokerage. In the first six months, our Business Integration revenue grew with 11.6% to € 4.546k (H1 2013: € 4.073k).
• E-Commerce: our E-Commerce proposition delivers webshop back-end solutions with full back office integrations. Our customers are typically large scale telecommunications companies such as KPN and T-Mobile. In the second quarter, the contract with T-Mobile was renewed and provides for a multi-year partnership extending earlier service levels to cover even more T-Mobile products and services. In the first six months, our E-Commerce revenue grew with 7.1% to € 1.222k (H1 2013: € 1.141k).
• Demand Generation (formerly known as Content Syndication): we have repositioned our Demand generation solution into a more modular solution. This allows our customers to ramp up the modular deployment of our solution at any desired pace, with a low entry cost level. The loss of CNET revenue in 2013 (H1 2013: € 310k) has almost fully been replaced with new business. In the first six months, our Demand Generation revenue increased with 156.4% to € 1.910k (H1 2013 € 745k), mainly caused by the acquired TFT activites. Excluding CNET revenue our Demand Generation revenue increased with 339.1% to € 1.910k (H1 2013 € 435k)
• Business Analytics: with the acquisition of TFT, TIE Kinetix has become a dominant player in the German market for Analytics. TFT is a reseller of analytic tools (Google Search Appliance and Adobe) to the business community. As a full-service agency for web business performance and a pioneer in the field of user experience, Munich-based TFT provides e-commerce strategies, consulting services and managed hosting solutions. It serves a number of high-profile customers such as blick.ch, Swisscom, wetter.com, FOCUS Online and HolidayCheck. TFT has been consolidated since its acquisition on December 2, 2013. In the first six months our Analytics revenue grew with 51.2% to € 1.157k (H1 2013: € 765k).

Jan Sundelin (CEO) said: “TIE Kinetix is looking back at a very intense first six months. All in all we are not dissatisfied with the performance. The acquisition of TFT has brought us highly skilled specialist knowledge that we will use in our worldwide operations. Our integration business is doing well and we are proud with our recognition for that in Gartner’s Magic Quadrant. Our E-Commerce business will grow further along with the recently renewed T-Mobile contract. We will free up more resources and make further investments in our E-Commerce platform. For our Demand Generation business (formerly known as CSP) we have made significant investments in marketing and sales programs to launch the new modular approach system. At this stage it is too early to fully reap the benefits yet. In general, in the first six months our license sales have been weak. We are not concerned about that since it underscores the trend that license contracts are being replaced by SaaS, and we have always considered license sales opportunistic rather than strategic.”

(For the full version of the press release, please download from the link below.)

About TIE Kinetix
TIE Kinetix transforms the digital supply chain by providing Total Integrated E-Commerce solutions. These solutions maximize revenue opportunities by minimizing the energy required to market, sell and deliver online. Customers and partners of TIE Kinetix constantly benefit from innovative, field tested, state-of-the-art technologies, which are backed by over 25 years of experience and prestigious awards. TIE Kinetix makes technology to perform, such that customers and partners can focus on their core business.

TIE Kinetix is a public company (NYSE Euronext: TIE Kinetix), and has offices in the United States, the Netherlands, France, Australia, UK, Spain, Germany, Austria and Switzerland.

For further information, please contact:

TIE Kinetix N.V.
Jan Sundelin CEO or Michiel Wolfswinkel CFO
Phone: +31-88-369-8000
e-mail: Michiel.Wolfswinkel@TIEKinetix.com
Follow TIE Kinetix on Twitter: twitter.com/TIEKinetix
Follow TIE Kinetix on LinkedIn: linkedin.com/company/TIE-Kinetix
Follow TIE Kinetix on Facebook: facebook.com/TIEKinetix 

Press release interim consolidated financial statements TIE KINETIX N.V.
Financial information in the interim report is unaudited

END OF PRESS RELEASE