The revenue from sales of licences and maintenance developed positively during the period, but the revenue from services was down due to an increased delivery of services through the partners.
The operating result before depreciation (EBITDA) ended at MNOK 18,0 (MNOK 17,5). The operating result (EBIT) ended at MNOK 16,2 (MNOK 16,5). 62% of the turnover in Q1/08 was generated from units outside of Norway. Compared to Q1/07, the turnover is affected by a stronger NOK and that the entire Easter this year was in March with less business days in March.
The net cash flow from operating activities ended in Q1/08 at MNOK 136,5 (MNOK 112,3). The company’s financial position is very strong.
Comments to the operation
Revenues
SuperOffice’s main business revenue is derived from the sales of software licenses and from software maintenance, and the positive development experienced from Q4/07 has in total continued in Q1/08. The total revenue from sales of licences and maintenance ended in Q1/08 at MNOK 68,1 (MNOK 60,2), an increase of 13,1%.
Revenue from Services ended in Q1/08 at MNOK 14,2 (MNOK 14,8). As discussed in previous reports, the partners are increasingly involved in deliveries of services, and the development in own service revenues will, as such, vary from quarter to quarter. In this period, we note that Germany and Switzerland had lower service revenues compared to the same period in 2007.
Operating expenses
The total operating expenses for the quarter ended at MNOK 64,9 (MNOK 58,6).
The increase in wages and social costs for Q1/08 is mainly related to the number of employees that increased in Q2/07 following the acquisition of SuperOffice eJournal. There has also been a certain increase within sales and development together with a general increase in salaries. For the first quarter 2008 isolated, the accounts have also been affected by external hired personnel in Denmark. They will conclude their work during April 2008. At the end of Q1/08 , SuperOffice group had 235 employees.
Other operating expenses have been reduced compared to Q1/07. The reduction is mainly due to the fact that several internal projects related to increasing the efficiency of internal routines and systems were completed in 2007.
The reduction in marketing is primarily due to a further focus on the activities performed, and not overall reduced activity. Bad debt expenses are still on a very low level. The losses in Q1/08 relates to the business in Denmark,
Operating result
EBITDA for the quarter ended at MNOK 18,0 (MNOK 17,5) with an EBITDA margin of 21,7% (23,0%). EBIT for the quarter ended at MNOK 16,2 (MNOK 16,5), with an EBIT margin of 19,5% (21,7%).
Net Result
Net financial items for the quarter ended at MNOK 0,7 (MNOK 3,6). The reduction from the same period in 2007 is mainly due to the fact that Q1/07 included gains from currency positions and a gain from a Total Return Swap. The financial result also includes agio/disagio (foreign currency exchange) from outstanding accounts with the subsidiaries. The net result after taxes ended at MNOK 12,1 (MNOK 14,9).
Cash Flow
The positive net cash flow from Q1/08 operations was MNOK 136,5 to MNOK 112,3 in the same period in 2007. The company’s cash flow in the first quarter is influenced by the invoicing of maintenance for existing customers in January. The revenue recognition is relatively linear during the year.
During January and February 2008, SuperOffice ASA acquired a total of 1 100 000 treasury shares for a total of MNOK 32,6. On April 17, the Annual General Meeting approved to reduce the share capital by cancellation of SuperOffice ASA’s balance of 1 450 000 treasury shares corresponding to a nominal value of NOK 1 015 000.
Balance sheet
SuperOffice has a solid financial position as a basis for future growth. Please see below for comments to the main balance sheet items.
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Account receivables amounted at the end of Q1/08 to MNOK 58,9. The accounts receivables compared to turnover is lower compared to the same period in 2007.
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The liquidity balance at the end of Q1/08 was MNOK 137,7, and relates mainly to bank deposits. The Company has no interest bearing debt.
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The increase in short term liabilities from December 31, 2007 relates mainly to prepaid maintenance. Other short term liabilities are mainly related to accrued expenses, corporate taxes, value added tax and prepaid expenses.
Products
The development of the company’s products has continued in accordance with the predefined plans.
Following the success with the release of SuperOffice’s new web application in Q4/07 the company has worked on what we call “The Global Consolidated Platform” in Q1/08. This work includes a common release of the company’s total product portfolio on a common platform that supports all forms of languages and design presentations (Unicode) as well as a number of functions especially directed towards businesses with a comprehensive international operation. The plan is to complete the new versions by the end of Q2/08.
During Q2/08 a new version of SuperOffice eJournal will be released named SuperOffice Service & Support.
Development by market
SuperOffice targets mid sized business-to-business oriented companies with a potential for 20-500 users of SuperOffice software. SuperOffice is increasingly involved in major contracts, i.e. solutions which include 100-300 users. The sales cycle for such contracts is longer, and may influence the operating revenue from quarter to quarter in the respective markets. We can clearly see this especially in Q1/08 where the entities, Norway and Switzerland, had a very positive development, while the entities in Sweden and Denmark had a weak quarter. The total export share for the quarter is 61,9%.
Annual General Meeting for 2007
At the Annual General Meeting for 2007 on April 17 2008 a dividend of NOK 3,00 per share for 2007 was approved.
Future expectations
The Company’s strategy is unchanged from what has been communicated in previous quarterly reports. External market analysts still expect the CRM market to grow, and SuperOffice is well positioned to continue to be a leading supplier of CRM solutions in Europe. SuperOffice continuously evaluates acquisition of CRM related software companies which are considered to contribute with added value, improved market position and profitable business opportunity to the group.
For 2008 as a whole the company has a positive view on the development of the major markets where SuperOffice has its own business, but as mentioned in previous reports the development in the respective markets might vary from quarter to quarter depending on in which quarters major contracts are signed.
Since 2002, SuperOffice has shown a positive development in both revenue and profits, and this is also the ambition for 2008.
This quarterly financial statement is presented according to IAS 34 and the accounting principles described in the Annual Report for 2007. The quarterly report for Q2/08 will be released July 11, 2008.
The Board of Directors of SuperOffice ASA
Oslo, April 17, 2008.
SUO Q1 2008 report English.pdf
SUO_Q1_2008_PPT_English.pdf
SuperOffice Q1/2008 Webcast