Siili Solutions Plc: Business Review, January 1 – March 31, 2024
Siili results decline as expected, good progress within AI
Siili Solutions Plc Stock Exchange Release April 24, 2024 9:45am EEST
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million euros |
Q1 2024 |
Q1 2023 |
|
revenue |
29.8 |
33.6 |
|
Increase in revenue, 1 million euros |
-3.8 |
4.3 |
|
Revenue growth rate, % |
-11.3% |
14.5% |
|
Organic revenue growth, €1 million |
-3.8 |
2.7 |
|
Organic revenue growth rate, % |
-11.3% |
8.6% |
|
Adjusted EBITA1 |
1.6 |
3.3 |
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Adjusted EBITA, % of revenue |
5.3% |
10.0% |
|
Ebita |
1.4 |
3.3 |
|
EBITA, % of revenue |
4.6% |
10.0% |
|
Average number of employees during the period |
990 |
1,050 |
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Number of employees at end of period |
973 |
1,054 |
|
Number of full-time employees (FTE) at end of period |
950 |
1,024 |
|
Number of full-time subcontracted employees (FTE) at end of period2 |
137 |
187 |
|
1 The EBITA adjustment of €200,000 consists of personnel costs related to the restructuring. |
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2 Figures for comparative periods have been revised retrospectively. |
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Main events from January to March:
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Siili has streamlined its organizational structure and COO Kari Pirttikangas has stepped down from Siili and the Siili management team.
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Siili Solutions has achieved the internationally recognized ISO 27001 information security certification.
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Good development in the field of AI: 75% of Siili employees are GenAI certified, and the AI-supported Viki and Köpi radio talk show developed by Siili for the Finnish Public Service Media Company wins Grand One competition I won the award.
Outlook for 2024:
Revenues in 2024 are estimated at between €120 million and €140 million, with adjusted EBITA between €7.5 million and €10.5 million.
CEO Tomi Pienimäki:
The first quarter of this year was predictably difficult for Siili due to last year's tight market conditions. From January to March, the group's revenue amounted to just under 30 million euros, down 10% from the strong comparative period. The decline in sales was also highlighted by a slight decrease in the number of business days compared to last year. Adjusted EBITA for the reporting period was EUR 1.6 million, or 5.3% of revenue. Due to the decline in sales, profit margins also deteriorated compared to the comparative period, as expected.
Amid severe market conditions and price competition, we have continued to work to improve the efficiency of our operations. Recruitment has been moderate in response to customer demand. Additionally, we have streamlined the reporting structure for our Finnish division. This is a step towards further strengthening the business unit focused on customer-facing businesses. In this situation, our company focused on strengthening its competitiveness and building competitive advantages.
Experience has shown that when the market is quiet, the foundation for success is laid when the market picks up. We believe that the effects of the efficiency measures we started last year and are still continuing will be fully reflected in our competitiveness and profitability once market conditions begin to improve.
Despite the challenging market environment, we saw many successes in the first quarter. AI-assisted development offers a wealth of new opportunities for both clients and employees. That's why we launched a 3-level AI training program for our consultants in January. By the end of March, 75% of his Siili employees in Finland had achieved first-level certification, and training continues throughout the year.
In addition to our own efforts, we also had the opportunity to collaborate with clients on several digital services powered by artificial intelligence. Among other things, we developed a menopause coach called Vera for the Dutch company Vi, based on OpenAI technology. Also, her AI-assisted radio show based on the Viki and Köpi talk show won an honorary award at the Grand One Digital Media Competition. In addition, we won several AI tenders in the public sector, including one for the Payathame Welfare District in Finland.
Current market sentiment appears contradictory. Our activity with customers is increasing, but at the same time the general economic situation continues to cause uncertainty. In the long term, demand for digital development services is expected to remain strong. We will continue to maintain a flexible and efficient way of operating, while strengthening our expertise, particularly in artificial intelligence. This allows us to best support both our clients and staff.
We are living in the midst of a very interesting technology paradigm shift, and we would like to thank Siili's employees and customers for their curiosity and open-minded thinking in the face of new opportunities. I think.
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This is not an interim report under IAS 34. The company complies with the semi-annual reporting requirements of the Securities Markets Act and publishes business reviews for the first three and nine months of the year that provide important information about the company's financial performance. The financial information presented in this business review has not been audited.
Further information:
CEO Tomi Pienimäki
Phone: +358 40 834 1399, Email: tomi.pienimaki(at)siili.com
CFO Aleksi Kankainen
Phone: +358 40 534 2709, Email: aleksi.kankainen(at)siili.com
distribution:
Nasdaq Helsinki K.K.
Main media
www.siili.com/en
Siili solution overview:
Siili Solutions Plc is a unique combination of a digital agency and a technology giant. We believe in human-centeredness in everything we offer. Siili is the go-to partner for clients seeking growth, efficiency and competitive advantage through digital transformation. Siili has offices in Finland, Germany, Poland, Hungary, the Netherlands, the United Kingdom, Austria, and the United States. Siili Solutions Plc's shares are listed on Nasdaq Helsinki Ltd. Siili has grown profitably since his founding in 2005. www.siili.com
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