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Following Strong 4th Quarter PSI with Better Margin and Strong Cash Flow

* Group Net Result improved by 14.6%

* Sales 3.7% below previous year following risk reduction in Southeast Asia

* Software products for industry 4.0 ready to launch

* Increase of dividends to 0.22 euro planned
KPI (TEUR)                1 Jan. - 31 Dec. 2016

Sales                     176,854
EBIT                       11,835
Group net result            8,551
Earnings per share (EUR)        0.55

KPI (TEUR)                1 Jan. - 31 Dec. 2015  Change

Sales                     183,682                 -3.7%
EBIT                       11,109                 +6.5%
Group net result            7,459                +14.6%
Earnings per share (EUR)        0.48              +4%

Berlin, 22 March 2017 -- PSI Group attained an EBIT of 11.8 million euros in financial year 2016 (31 Dec. 2015: 11.1 million euros). Together with higher financial results due to currency effects, group net result increased by 14.6% to 8.5 million euros (31 Dec. 2015: 7.5 million euros), the earnings per share improved correspondingly to 0.55 euro (31 Dec. 2015: 0.48 euro). With 176.9 million euros, sales were 3.7% below the value for the previous year (31 Dec. 2015: 183.7 million euros). The decline in sales is largely the result of the substation automation business in Southeast Asia. In view of the economic and political environment in the region, the Management Board has implemented a higher price discipline, adjusted capacities and reduced risks and capital binding. In spring of 2016, provisions for risks in old and new projects in the steel sector have been made in view of the commodity price crisis. At 13.3 million euros, operating cash flow was again higher than the operating result. New orders were, with 182 million euros, 6.7%, below the previous year (31 Dec. 2015: 195 million euros), the order backlog was constant at 129 million euros.

Energy Management (energy networks, energy trading) increased sales by 3% to 69.2 million euros despite headwinds and considerable industry problems (31 Dec. 2015: 67.2 million euros), the EBIT for the segment improved by 9.4% to 5.8 million euros (31 Dec. 2015: 5.3 million euros). The electrical grid business continued to increase sales and EBIT, while demand in the gas grid and pipeline business only recovered slowly after the drop in raw material prices in the first quarter and the ruble weakness. PSI has further expanded the technical leadership by means of new developments. This applies in particular to the topics of sector coupling, electro mobility, grid management as a service and a new, artificial intelligence-based grid autopilot, which dramatically improves the safety and profitability of network operations. The energy trading business was able to slightly increase its EBIT over the previous year.

Sales in Production Management (raw materials, metal production, automotive, logistics) were, at 84.2 million euros, 2.5% below the figure for the previous year (31 Dec. 2015: 86.4 million euros), the EBIT increased by 14.5% to 7.1 million euros (31 Dec. 2015: 6.2 million euros). Major and onerous market launch projects were concluded successfully in China in the raw material excavation business and production business. The metals production business continued its rollouts for major customers and increased, despite the dramatic situation in the steel market at the beginning of 2016, new orders and EBIT. In the production and logistics businesses, PSI successfully carried out important pilot projects for the products migrated to the Group platform. The automotive and industry business won important major contracts in the field of rolling stock construction and vehicle maintenance and improved its EBIT significantly.

In Infrastructure Management (transportation and safety), sales decreased significantly to 23.5 million euros (31 Dec. 2015: 30.1 million euros) following reductions in capacity in the capital-intensive substation automation business in Southeast Asia, the EBIT decreased to 0.1 million euros (31 Dec. 2015: 0.8 million euros). In Malaysia, PSI moved the expansion of the high-margin software business especially in the field of smart cities forward and hired additional software engineers for this business.

The number of employees on 31 Dec. 2016 was, after capacity adjustments in Asia and new hires in Europe, 1,619 (31 Dec. 2015: 1,650). The cash flow from operations was, at 13.3 million euros, once again very solid (31 Dec. 2015: 14 million euros). Liquidity at the end of the year increased to 43 million euros (31 Dec. 2015: 38.8 million euros) so that PSI has sufficient funds for targeted acquisitions in the fields of energy grids and automotive. The Board of Directors, with the approval of the Supervisory Board, will recommend a dividend of 0.22 euros (previous year: 0.21 euros).

By the end of 2016, all the major software products in Production Management had been converted to the new, group-wide Java platform and pilot projects were successfully implemented with customers. Customers are enthusiastic that they can now customise the user interfaces themselves by click & drop. PSI will demonstrate the interaction of the uniform software products with the Industry 4.0 swarm manufacturing at Hannover Fair from the cloud. As of 2017, regular customers will be increasingly migrated to the new product versions and new customers approached with this feature. In view of the stabilisation of many PSI target markets in recent months and with a sales initiative for the renewed products, the PSI Board of Directors is optimistic about financial year 2017. PSI is therefore striving for a sales growth in the mid-single digits and an EBIT between 12 and 15 million euros.

On the basis of its own software products, PSI AG develops and integrates complete solutions for energy management (energy networks, energy trading), production management (mining, metals, automotive, mechanical engineering, logistics) and infrastructure management for transport and safety. PSI was founded in 1969 and employs more than 1,600 persons worldwide.

PSI Group

The PSI Group employs 1,650 persons in eleven German and seventeen international locations in Europe, Asia and North America. In the financial year 2015 the Group achieved revenues of 183.7 million Euro. PSI AG is listed in the Prime Standard of the German stock exchange.
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Title Annotation:Leading Companies
Publication:Germany Software & It
Geographic Code:90SOU
Date:Jul 19, 2018
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