Intershop Communications AG | Press Release |
Intershop’s positive business trend continues in Q3 2015
- Q3 2015: Growing sales revenues and positive result for the period
- 9M basis: Decline in sales reduced; EBITDA much higher at EUR 2.7 million; EBIT moderately positive
- Product revenues climb sharply (9M: +40%)
Jena, 4 November 2015 – Intershop Communications AG (ISIN: DE000A0EPUH1), the leading independent provider of innovative solutions for omni-channel commerce, continued the positive trend of the previous quarters in Q3 2015.
At Group level, Intershop’s revenues increased by 6% to EUR 11.7 million in the third quarter of 2015. Revenues for the nine-month period totalled EUR 32.7 million, down 6% on the prior year period; at the six-month stage, revenues had been down by as much as 12% on the previous year. Adjusted for the revenues of the online marketing subsidiary sold with effect from 30 September 2014, the Group’s revenues were up by 3% in the reporting period.
The upward trend was essentially due to increased licensing revenues, mostly revenues generated with new customers from the SME sector. At the same time, a major licensing contract signed in August with a long-standing strategic customer made a substantial contribution to the positive sales trend.
Total product revenues (licenses and maintenance) for the nine-month period increased by 40% to approx. EUR 13.0 million; licensing revenues increased by an impressive 88% to EUR 7.0 million, with the major contract mentioned above making the biggest contribution. Maintenance revenues climbed 7% to roughly EUR 6.0 million. By contrast, service revenues declined by 23% to EUR 19.7 million in the first nine months of 2015, mainly due to the fact that the projects with two large customers are nearing completion. Accounting for 60%, service revenues continue to make the biggest contribution to the Intershop Group’s total sales revenues, although the share of product revenues increased by 13 percentage points in the course of only one year and now stands at 40%. This increase and the improved cost structure greatly improved Intershop’s profitability. The gross result was up by 22% on the prior year period to EUR 14.3 million, while the gross margin climbed from 34% to 44%. Operating expenses declined by 13% to EUR 14.3 million. Earnings before interest, taxes, depreciation and amortisation (EBITDA) rose sharply from EUR -1.7 million in the prior year period to EUR 2.7 million in the reporting period. At EUR 0.05 million, earnings before interest and taxes (EBIT) were also moderately positive, up from EUR -4.8 million in the prior year period. The third quarter was positive throughout, with EBIT coming in at EUR 0.6 million and the result for the period at EUR 0.5 million. The result for the nine-month period was almost balanced at EUR -0.1 million. Earnings per share amounted to EUR 0.00, compared to EUR -0.17 in the previous year.
Says Dr. Jochen Wiechen, CEO of Intershop Communications AG: “After a number of negative quarters, strong licensing revenues finally led to a positive operative result for the third quarter. The result is encouraging and shows that the strategy to transform the company from a service provider to an omni-channel provider is beginning to take effect.”
Operating cash flow improved notably from EUR -0.9 million to EUR 4.2 million in the reporting period. The positive operating trend as well as the debt and equity measures implemented in the reporting period sent the company’s cash and cash equivalents rising sharply from EUR 6.4 million at the end of 2014 to approx. EUR 15.0 million as of 30 September 2015.
Says Dr. Jochen Wiechen: “We are cautiously optimistic about the coming months. Winning new B2B customers remains one of our key priorities. A study recently conducted by us impressively reflects again the huge potential in this market. We will also focus on expanding our SaaS solutions, for which we are seeing increased demand from fast growing SMEs:”
The report on the first nine months of 2015 is available for downloading at http://www.intershop.com/investors-financial-reports
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.