Intershop Communications AG | Press Release |

Intershop publishes figures for first nine months of 2016

  • Revenues of EUR 24.7 million (previous year: EUR 32.7 million)
  • Product business falls short of expectations, service revenues continue to stabilize
  • EBIT of EUR -2.0 million (previous year: EUR 0.05 million)
  • “Lighthouse 2020” strategy: Focus on wholesale and cloud business

Jena, 2 November 2016 – Intershop Communications AG (ISIN: DE000A0EPUH1), a leading independent provider of innovative solutions for omni-channel commerce, generated revenues of EUR 24.7 million in the first nine months of 2016 (previous year: EUR 32.7 million). On the one hand, the 25% decline is attributable to a shift in projects and a shortfall of expected license orders, which sent product revenues falling by 27% to EUR 9.5 million. On the other hand, service revenues, at EUR 15.2 million, were still below the prior year level (-23%). This is due to the changed customer structure, with a focus on small and medium-sized customers. The quarterly comparison shows, however, that the service business has stabilized, with service revenues climbing from EUR 4.5 million in Q1 to EUR 5.4 million in Q3 2016.

Intershop’s product revenues break down into approx. EUR 3.5 million in license revenues (previous year: EUR 7.0 million) and EUR 6.0 million in maintenance revenues (previous year: EUR 6.0 million) in the first nine months of 2016. In the service segment, revenues from consulting contracts amounted to EUR 11.8 million, (previous year: EUR 15.1 million) while full service revenues stood at EUR 3.4 million (previous year: EUR 4.6 million).

The 44% gross margin for the nine months was consistent with the prior year period. Operating expenses declined by 9% to EUR 13.0 million. Due to the drop in revenues, earnings before interest, taxes, depreciation and amortisation (EBITDA) declined to EUR -0.2 million (previous year: EUR 2.7 million). EBIT amounted to EUR -2.0 million in the reporting period, compared to EUR 0.05 million in the previous year. The result for the period stood at EUR -2.4 million (previous year: EUR -0.1 million). This is equivalent to earnings per share of EUR -0.07 (previous year: EUR 0.00).

The Intershop Group’s cash flow from operations amounted to EUR -1.4 million in the first nine months of 2016 (previous year: EUR 4.2 million), which is mainly attributable to the net loss for the period. Cash and cash equivalents totalled EUR 10.9 million at the interim reporting date. The equity ratio improved to 61% (31 December 2015: 58%).

Against the background of the ongoing market consolidation and the lack of growth momentum, Intershop has initiated the “Lighthouse 2020” strategy program. Following on from the concentration on the product business in the past two years, Intershop will focus on customers from the wholesale sector going forward. Another strategic focus of the program is on the continued expansion of the cloud business; in this context, the Intershop 7.8 Cloud Solution will be launched before the end of the year. The new cooperation with Microsoft will play an important role, as it allows customers to seamlessly integrate the Intershop systems with the cloud-based Dynamics NAV ERP solution from Microsoft.

According to the new roadmap, the Management Board projects sales revenues of between EUR 34 million and EUR 36 million as well as a negative result (EBIT) of between EUR 1 million and EUR 2.5 million, including extraordinary expenses of approx. EUR 1 million.

Says Dr. Jochen Wiechen, CEO of Intershop Communications AG: “In spite of the disappointing nine-month figures, we are convinced that our strategic positioning and the related reorganization are the right approach. We project revenues of EUR 50 million and an EBIT margin of 5% by 2020 and will do everything in our power to reach these growth targets.”

The interim report on the first nine months of 2016 is available for download at http://www.intershop.com/investors-financial-reports.

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About Intershop

Intershop Communications AG (founded in Germany 1992; Prime Standard: ISH2) is the leading independent provider of omni-channel commerce solutions. Intershop offers high-performance packaged software for internet sales, complemented by all necessary services. Intershop also acts as a business process outsourcing provider, covering all aspects of online retailing up to fulfillment. Around the globe more than 300 enterprise customers, including HP, BMW, Würth, and Deutsche Telekom run Intershop solutions. Intershop is headquartered in Jena, Germany, and has offices in the United States, Europe, Australia, and China. More information about Intershop can be found online at www.intershop.com.

This news release contains forward-looking statements regarding future events or the future financial and operational performance of Intershop. Actual events or performance may differ materially from those contained or implied in such forward-looking statements. Risks and uncertainties that could lead to such difference could include, among other things: Intershop's limited operating history, the unpredictability of future revenues and expenses and potential fluctuations in revenues and operating results, significant dependence on large single customer deals, consumer trends, the level of competition, seasonality, risks related to electronic security, possible governmental regulation, and general economic conditions.

Intershop Public Relations

Heide Rausch

Head of Corporate Communication

Phone: +49 3641 50-1000
Fax: +49 3641 50-1309