DGAP-News: KPS AG: KPS publishes report on third quarter 2017/2018

KPS publishes report on third quarter 2017/2018

Unterföhring/Munich, August 10, 2018 - KPS AG (WKN: A1A6V4 / ISIN: DE000A1A6V48), Europe's leading management consultancy for business transformation and process optimization, increased its sales by 5.5% in the third quarter of its fiscal year 2017/2018 compared to the same quarter of previous year from EUR 39.7 million to EUR 41.9 million. Earnings before interest and taxes (EBIT) declined to EUR 4.6 million compared to EUR 5.9 million in the same period of the previous year due to M&A-related depreciation and higher personnel costs. This equates to an EBIT margin of 10.9% (Q3 2016/2017: 14.8%). Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to EUR 5.7 million compared to EUR 6.2 million in the third quarter of fiscal year 2016/2017.

The rise in revenue is mainly due to higher sales from the most recent transformation projects acquired since the beginning of the year. Positive effects were also generated by KPS's acquisitions, confirming the Executive Board's sustained internationalization strategy. The positive effects from the new projects are reflected in the EBITDA margin in particular, which excludes the effects of depreciation and amortization in connection with the acquisitions. The EBITDA margin of 13.6% in the third quarter improved significantly compared to the half-year result (10.6%) to demonstrate the increased profitability of KPS's operating business and underscore the positive development of its acquisitions. In addition, KPS AG received several coveted awards in recent months: The business magazine brand eins, together with the statistics portal statista, once again awarded KPS and its subsidiary Infront Consulting the Best Consultants ranking in several categories. In 2018, KPS again made it to the top 10 of German management consultancies by coming in 6th place in the list published by the market research company Lünendonk. The TOP 100 competition did not select the most innovative medium-sized companies in Germany until the end of June. KPS AG is also one of the innovation leaders this year. Software solutions developed by KPS made it into the best apps of the Initiative Mittelstand. KPS also continues to rise in the annually published rankings of Internet and e-commerce agencies.

"The results for the third quarter show that we are within the scope of our planning and that our strategic efforts are beginning to pay off. While the projects acquired in connection with our acquisitions are increasing their sales contributions, we are of course continuing to work on the integration process, which is having a negative impact on our results. With regard to the EBITDA margin, however, we see that we will be able to return to the profitability levels of recent years in the medium term. On the one hand, we have a broader base due to our international expansion and, on the other hand, we have reduced the sales concentration of individual customers by acquiring several new projects. In summary, with this profitable structure and reduced risks, we feel we are well positioned for further development. In addition, our advances in the field of industrialization of consulting will enable us to provide attractive services with a decreasing cost base," explains Leonardo Musso, CEO of KPS AG.

The Executive Board and management of KPS AG confirm the sales forecast for fiscal year 2017/2018 of EUR 160 million to EUR 170 million and an operating result (EBIT) of EUR 16 million to EUR 20 million. This includes the sales contributions of ICE Consultants Europe SL, Barcelona, Spain, a company acquired on October 2, 2017, Infront Consulting & Management GmbH, Hamburg, Germany, and Envoy Digital Limited, London, UK, acquired at the beginning of 2018. The Supervisory Board and Executive Board of KPS AG also view the results of the third quarter 2017/2018 as confirmation of the strategic orientation.

The detailed quarterly release for the third quarter of fiscal year 2017/2018 is now available for download at www.kps.com

August 10, 2018

KPS AG
The Executive Board

About KPS

KPS is Europe's leading transformation consultancy for companies who want to radically focus on the customer and realign their business processes and technologies accordingly. KPS delivers everything from a single source: strategy consulting, industry-specific process chains as well as the implementation of the latest technologies. KPS is one of the few consulting partners who advise their clients end-to-end and integrate ERP, B2B and B2C commerce with Marketing & Sales processes. Especially in a digital world, the capability to execute projects faster is a clear and significant competitive advantage: The KPS Rapid-Transformation(R) methodology accelerates projects by up to 50 percent. With around 1000 consultants in 12 countries, KPS continues to expand its market position by delivering successful digital and technological transformation projects.

Reshape and transform rapidly. Your business in a digital world. www.kps.com

KPS AG
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Phone: +49 (0) 89 356 31-0
Fax: +49 (0) 89 356 31-3300
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