Sygnity Sa · GPW:SGN
Sygnity Sa — Investor Presentation (June 2007)
30 slides from Sygnity Sa's investor presentation, June 2007
Slide 1: Company presentation
Company presentation June 2007
Slide 2: Disclaimer
2 Disclaimer The present study has been prepared only for information purposes. It does not constitute an advertisement or offer for securities in public trading. It uses sources of information that Sygnity S.A. and Emax S.A. have acknowledged as reliable and exact, however it is not represented tha
Slide 3: Polish economy is in the good condition
3 Polish economy is in the good condition • Continued economic revival commenced in 2005: – 6,4% GDP growth y-o-y in Q4 2006 – Q1 2007 GDP growth expected at historically high level and set to continue throughout whole 2007 – continued strong domestic consumption • Improvement on the labour market:
Slide 4: Polish IT market ready for natural growth
4 Polish IT market ready for natural growth • Annual IT spendings per capita in Poland ca. 100 EUR vs. over 700 EUR in EU 15 • EU funds availability for new EU members • Development of outsourcing and BPO: Poland becoming the Europe’s accountant • Domestic players outpace the international ones on t
Slide 5: Signs of the Polish IT market revival
5 Signs of the Polish IT market revival • Ordinance on the State Informatization Plan for the years 2007- 2013 • Changes on the energy market • Medical Services Register (RUM) • Further computerization of schools by Ministry of National Education • Border Guards projects • Projects of the Central Of
Slide 6: Sygnity snapshot – establishment of the Company and market capitalisation
6 Sygnity snapshot – establishment of the Company and market capitalisation • Sygnity has been formed as the result of the process of combining the experience and the best practicies of ComputerLand and Emax in order to bring the new quality to the Polish IT market. Sygnity SA is the second biggest
Slide 7: Sygnity snapshot
7 Sygnity snapshot Proforma results of ComputerLand Group for 2006, including the results of Emax Group for 2006, as if the acquisition had taken place on 1 January 2006 Consolidatio CL-Emax 2006 CL Group Emax Group 2006 n exclusions Group according the share of adjustments according to to CL Comput
Slide 8: Sygnity snapshot – key references, sales structure
8 Sygnity snapshot – key references, sales structure Key references: • Banking: – National Bank of Poland General Business – BPH BANK (HVB - UniCredito) Banking and (energy, – BZ WBK (AIB) Finance industry, 26% – Kredyt Bank (KBC) trade) – PKO BP SA 29% – GE Money Bank SA – Raiffeisen Bank • Power s
Slide 9: Reasons to merge
9 Reasons to merge • Two of the largest domestic IT services companies with long histories of complex and successful projects • Both companies put strong emphasis on sector expertise as a key success factor • Significantly complementary market offer (in particular in the energy, banking and telecom)
Slide 10: The Merger History
1 The Merger History 0 26th of May 2006 Announcement of the merger intention 27th of July 2006 Approval from antitrust regulator 11th of September ComputerLand reaches 33% of votes in Emax (12,1% in equity) 2006 20th of September ComputerLand reaches 65% of votes in Emax (36% in equity) 2006 24th of
Slide 11: Sygnity strategy
1 1 Sygnity strategy • Sector focus accompanied by extensive industry knowledge and expertise • Long-term client relationship based on the delivery of full scope of services – from consultancy through implementation to outsourcing • Focus on in-house software solutions complemented by universal pack
Slide 12: Strategy realised in particular sectors
1 2 Strategy realised in particular sectors (values in PLN mln) Banking Telecom – Strong client base in s – Sales to the FT group Poland (KSP. NPT, Convergence) – Know-how in centralised – Growing revenues from systems mobile operators – Extensive product offer 300M 120M – Outsourcing references – F
Slide 13: Clear management goals
1 3 Clear management goals Achievement of operating profitability of 8%+ in 2008 by: •Maintaining revenues at stable level •Reaching a bigger share of own solutions in sales structure •Maintaining the speed of restructuring processes 13
Slide 14: Market position: Banking & finance
1 4 Market position: Banking & finance Polish B&F IT market 2006E (PLN bln)1 • Market drivers – Major sources of demand: introduction of new banking products, Basel II, cost 2,25 cutting – Changes in banking law are opening the market to outsourcing initiatives – Integration of new banking groups –
Slide 15: Market position: Telecoms
1 5 Market position: Telecoms Polish Telecom IT market 2006E (PLN bln) 1 • Market drivers – New Generation Network (NGN, DVB) 1,88 – Strong competition – the fight for new customers • Company expertise – Group of specialized products created on EMAX and ComputerLand position on the Polish Telecom I
Slide 16: Market position: Utilities
1 6 Market position: Utilities Polish Utilities IT market 2006E (PLN bln) 1 • Market drivers – Deregulation, consolidation and 1,27 privatization in the power electricity and gas distribution • Company expertise – New version of in-house multimedia billing system EMAX and ComputerLand position on th
Slide 17: Market position: Public
1 Market position: Public 7 Polish Public IT market 2006E (PLN bln)1 • Market drivers – Forthcoming projects financed from Schengen Funds – Border Protection (SIS II), Police, Ministry of Justice 3,01 – Continued EU funding for Poland – The development of the information society in Poland • Company
Slide 18: Market position: Healthcare
1 8 Market position: Healthcare • Market drivers – Annual sector IT spending ca. PLN 120 m with high growth potential – Limited competition: Spin (Prokom subsidiary), Kamsoft, Alma. – Prospective RUM (national medical service registration) system worth PLN 500- 800 mln • Company expertise – 26% of t
Slide 19: Key areas of synergies
1 9 Key areas of synergies Revenues synergies: Cost synergies: • Intensification of sales, • Rationalisation of the range of and in particular exploitation own products offered of the strong position of the • Centralisation of software merged companies in selected production sectors • Optimisation o
Slide 20: Assessment of synergies
2 0 Assessment of synergies in PLN 000’s 2007 2008 2009 2010 Total Revenues 35,075 46,453 51,908 44,189 177,625 Additional margin 7,300 10,064 11,273 9,875 38,512 Implementation (1,992) (6,644) (6,644) (6 644) (21,924) Management Board (3,965) (7,811) (8,111) (8,410) (28,297) Selling costs (204) (21
Slide 21: Merger benefits
2 1 Merger benefits • For shareholders: – Improving the general strategic position of the Company by increasing its critical mass and scope of activities – Strengthening the Company’s market position in certain sectors through cross-selling – Continued improvement of the Company’s operating efficien
Slide 22: Sygnity consolidated results for Q1 2007
2 Sygnity consolidated results for Q1 2007 (in PLN mln) 2 CONSOLIDATE THE SYGNITY D GROUP EXCLUDING THE CONSOLIDATED Q1 2007 THE EMAX GROUP EXCLUSIONS/ THE RESULTS OF SYGNITY GROUP MORTISATION THE EMAX GROUP ADJUSTMENT NET REVENUE 183,166 84,456 (1,320) 266,302 OPERATING PROFIT (LOSS) (9,986) (8,032
Slide 23: Q1 2007 results - commentary
2 3 Q1 2007 results - commentary • Q1 – traditionally the slowest period of the year in IT business on the Polish market • Stagnation on the public tenders THE COSTS REDUCTION market IN Q1 BY MORE THAN • No earnings from the projects PLN 3 MILLION COMPARED TO THE completed in 2006 (new projects has
Slide 24: Q1 – a period of intensive transformation
2 4 Q1 – a period of intensive transformation • Consent of the shareholders to the merger with Emax (14 and 15 of March) • Implementation of the Group’s Organisational Model – ca. 100 Top Managers has their precisely defined positions. • Commencement of the consolidation of the Group • Commencement
Slide 25: Effects of CoLorado project in 2006 and Q1 2007
2 Effects of CoLorado project in 2006 and Q1 5 2007 • Project - based organizational structure – Change into project – based structure (8 domains and projects bureau instead of 22 competences centers); new assignments for production and implementation employees, efficiency measures, pilot implementa
Slide 26: Attachement – new name and logo
2 6 Attachement – new name and logo
Slide 27: Reasons to change the name
2 Reasons to change the name 7 CURRENT SITUATION - CHALLENGE OPTIMAL SCENARIO REASONS MERGER Introducing new Introduce new name REPOSITIONNING name when FOREIGN MARKETS deciding upon merger COMPLETED PROJECT OF EXPORT BRAND 27
Slide 28: Key associations behind new name
2 Key associations behind new name 8 Appropriate for large Associated with dignity and solemnity companies as well as for small and creative Easy to pronounce and spell Flexible Distinguishing Associated with high quality Appropriate for several industries, including IT 28
Slide 29: Positioning theme: Competence on
2 9 Positioning theme: Competence on The meaning: Efficient completion of projects thanks to full understanding of the customer’s needs 29
Slide 30: Thank you
Thank you competence on