Innofactor Plc's Interim Report for January 1–March 31, 2020 (IFRS)
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05.05.2020 09:00 EEST (UTC +3)

Innofactor Plc's Interim Report May 5, 2020, at 9:00 Finnish time


Record EBITDA in the first quarter

January–March 2020 in brief:

  • The net sales were approximately EUR 17.2 million (2019: 16.1), which shows an increase of 6.2%
  • EBITDA was approximately EUR 2.0 million (2019: 0.9), which shows an increase of 125%
  • The operating profit was approximately EUR 0.8 million (2019: -0.09), which shows an increase of EUR 0.9 million
  • The order backlog at the end of the review period was EUR 54.1 million (2019: 41.0), which shows an increase of 32%
  • Innofactor got several significant orders in the first quarter, for example,
    • The KOSTI project of the Legal Register Centre, approximately EUR 2.2 million (not yet in the order backlog at the end of the review period)
    • The further development of the HAIPA project for the Legal Register Centre, approximately EUR 2.2 million
    • The further development of HUS Health Village, approximately EUR 2.0 million
    • The case management solution for KELA, approximately EUR 1.1 million (not yet in the order backlog at the end of the review period)
    • The Ullensaker municipality in Norway, approximately EUR 1.0 million
    • A Finnish trading company, approximately EUR 0.7 million




Jan 1–March 31, 2020

Jan 1–March 31, 2019


Net sales, EUR thousand





Growth of net sales





Operating result before depreciation and amortization (EBITDA), EUR thousand*





percentage of net sales*





Operating profit/loss (EBIT), EUR thousand**





percentage of net sales*





Earnings before taxes, EUR thousand***





percentage of net sales*





Earnings, EUR thousand*





percentage of net sales*





Order backlog





Net gearing*





   Net gearing without IFRS 16





Equity ratio***





   Equity ratio without IFRS 16





Active personnel on average during the review period****





Active personnel on average at the end of the review period****





Earnings per share (EUR)







*) The handling of lease liabilities in accordance with IFRS 16 had a positive effect of EUR 504 (2019: 300) thousand in the operating margin (EBITDA) in January 1–March 31, 2020.

**) In accordance with IFRS 3, the operating result for January 1–March 31, 2020, includes EUR 473 thousand (2019: 507) in depreciations related to acquisitions, consisting of allocations of the purchase price to intangible assets.

***) Exchange rate changes related to the Group's internal debts (due to the weakened rate of the Swedish krona and Norwegian krone in relation to euro) results in a exchange rate loss of EUR -859 thousand in accordance with IFRS, but this loss does not affect the cash flow, only the result for the financial period, the Group's balance sheet and the equity ratio.

****) The Innofactor Group monitors the number of active personnel. The number of active personnel does not include employees who are on a leave of over 3 months.

Innofactor’s future outlook for 2020

Innofactor’s net sales and operating margin (EBITDA) in 2020 are estimated to increase from 2019, during which the net sales were EUR 64.2 million and operating margin was EUR 5.1 million.

CEO Sami Ensio's review: Strong start for 2020 – the negative business effects of the Coronavirus epidemic are estimated to remain minor

The net sales in the first quarter of 2020 were EUR 17.2 million, which shows an increase of 6.2 percent compared to the previous year. The net sales grew in all countries. The operating margin (EBITDA) grew 125.4 percent from the previous year and was EUR 2.0 million (11.4 percent of the net sales), and it was positive in all countries. In the first quarter, the order backlog grew to a record-breaking amount and was EUR 54.1 million at the end of the quarter, which shows an increase of 31.8 percent compared to the corresponding time in the previous year.

The Coronavirus epidemic has not so far had a significant effect on Innofactor's ability to provide services for its customers. Our employees have been working remotely as of March 12, 2020. Work efficiency in remote work remains at the same level as in the normal situation, and there has not been an increase in sick days.

However, our estimate is that the Coronavirus epidemic will have a minor effect on the net sales and profitability of the rest of the year. We estimate that we probably will not achieve comparable growth and profitability in the second quarter as we did in the first quarter. The growth and profitability in the third and fourth quarters will depend greatly on the schedule in which the restrictions due to the Coronavirus will be removed in the Nordic countries. We expect that the restrictions will be removed for the most part in August 2020 at the latest.

The Coronavirus epidemic will affect Innofactor in the short term mainly, if our customers scale back their purchases or move their acquisitions to a later date. We estimate that the negative effects of the Coronavirus epidemic in Innofactor's business remain minor for the following reasons:

  • A significant part (over 50 percent) of Innofactor's business consists of recurring services, and the customers' purchase behavior does not affect these much
  • We mainly offer business critical systems for our customers, and customers typically continue their development and maintenance even in unusual conditions
  • Approximately half of our customer base consists of public administration and third sector customers, who are affected more slowly by the Coronavirus and who also consider it sensible to proceed with their purchases in order to keep the society going.
  • Our business customers are mainly from fields, such as industry, which are not so strongly and quickly affected by the Coronavirus as certain other fields.
  • Our order backlog is very strong, and if needed, we are able to transfer personnel between projects to some degree and make our deliveries faster, which means that a loss of an individual customer will not necessarily affect our business
  • We have been able to quickly develop new services for the Coronavirus epidemic situation for our customers, such as the Remote Work Acceleration Pack (, which we believe will bring some replacement net sales to compensate for any losses
  • The societies in the countries in which we operate are granting many forms of relief, flexibility and support, which also helps Innofactor's profitability and financing

In the long term, we believe that the digital step the society is taking due to the Coronavirus epidemic will increase Innofactor's possibilities to grow its business operations. The abilities of a modern digital organization will be even more important for our customers in the future – also in preparation for the possible second wave of the epidemic. It is also possible that some of our customers will transfer some of their operations back to the Nordic countries in order to be closer to their customers. This would have a favorable effect as regards the business model of Innofactor's chosen strategy based on Nordic specialists. We also believe that Microsoft's position has strengthened during the Coronavirus epidemic. We believe in our chances of increasing our market share in the Nordic countries.

In April, Innofactor renewed the responsibility areas of the Executive Board so that as a CEO, I will also be the acting Chief Technology Officer until further notice. This will further speed up the decision-making, and we believe this will be of use in the business environment changes due to the Coronavirus epidemic, which require us to quickly renew our offering. The previous Chief Technology Officer Jufo Peltomaa will not continue in the company's service. I want to thank Jufo for his contribution in developing Innofactor's operation.

Innofactor's vision is to be the leading implementer of digitalization in each of the Nordic countries. We believe even stronger in our chosen Nordic strategy and in reaching our long-term goals in the world after the Coronavirus epidemic. Innofactor is still actively looking for new strategic partnerships. The Group’s goal is to grow both organically and through acquisitions. The Coronavirus epidemic may provide new and even surprising opportunities for this, and those may require fast actions. In view of this, we have drafted a separate plan, started to actively monitor the situation and, at the end of April, acquired EUR 3.0 million in additional funding in the form of a senior loan from a major Finnish pension insurance company to support our possible projects for gaining growth.

Strategy and its realization in the review period

Innofactor’s vision is to be the leading provider of organizations' digital transformation in each of the Nordic countries (Finland, Sweden, Denmark and Norway). The long-term financial goal is to grow profitably by achieving an annual growth of approximately 20 percent. The majority of this is intended to be achieved organically by achieving approximately 20 percent operating margin (EBITDA) in relation to the net sales, by keeping the cash flow positive and by securing solid financial standing in all situations.

Innofactor’s net sales in the first quarter were EUR 17.2 million (2019: 16.1), which shows an increase of 6.2 percent compared to the previous year. The net sales grew in all countries. The goal of getting the net sales to grow is also supported by the record-breaking order backlog of EUR 54.1 million (2019: 41.0). Of course, further actions are required to achieve the growth of 20 percent. The Coronavirus situation and Innofactor's strengthened financing position may also provide new possibilities for inorganic growth in the future. For this reason, Innofactor acquired EUR 3.0 million in additional funding in the form of a senior loan from a major Finnish pension insurance company.

In the review period, the operating margin (EBITDA) grew 125.4 percent from the previous year and was EUR 2.0 million (11.4 percent of the net sales). As regards profitability, Innofactor was able to improve its performance substantially, but some effort is still needed in order to reach the long-term goal of approximately 20 percent.

Innofactor’s operating cash flow in the review period of January 1–March 31, 2020, was EUR 3.1 million (2019: EUR 1.6 million) and the equity ratio at the end of the review period was 43.5 percent (2019: 40.0 percent). The strong operating cash flow supports Innofactor’s strategic goal of profitable growth and securing solid financial standing in all situations.


Espoo, May 5, 2020


Board of Directors


Additional information:
CEO Sami Ensio, Innofactor Plc
Tel. +358 50 584 2029


Briefings concerning the Interim Report January 1–March 31, 2020

Innofactor will publish the interim report for January–March on Tuesday, May 5, 2020, at around 9:00 Finnish time.

A video conference in Finnish concerning the interim report will be held for media, investors and analysts on the same day at 10:00 Finnish time. The report will be presented by CEO Sami Ensio. The corresponding video conference in English will be held at 12:00 Finnish time.

Please register for the conferences beforehand by sending email to

The presentations will be available on Innofactor's web site after the conferences.


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Innofactor is the leading driver of the modern digital organization in the Nordic Countries for its over 1,500 customers in commercial, public and third sector. Innofactor has the widest solution offering and leading know-how in the Microsoft ecosystem in the Nordics. Innofactor has over 500 enthusiastic and motivated top specialists in Finland, Sweden, Denmark and Norway. In 2015–2019, the annual growth of Innofactor's net sales has been approximately 10%. The Innofactor Plc share is listed in the technology section of the main list of NASDAQ Helsinki Oy. #ModernDigitalOrganization #PeopleFirst


Attachment: Innofactor Plc's Interim Report for January 1–March 31, 2020 (IFRS)

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