Leading Swedish IT services company WM-data AB has reported a net profit for the nine months to September 30, 1999 up 9% at SEK 475m ($57m) on revenue that rose 9% to SEK 8,850m ($1.06bn). At the pre-tax level, the Stockholm based company said profit was up 11% at SEK 710m ($85m).
Most of the company’s revenue and profit growth increase for the period was attributable to its Specialist Operations applications consulting and systems integration unit which jumped 19% in the period to SEK 2,230m ($269m), with a 14% profit margin.
Fastest growth was seen in WM-data’s Technical IT business which increased revenue by 272% to SEK 610m ($74m) in the period, albeit, albeit with a relatively small profit margin of 6%. Technical IT comprises Gothenburg based application development specialist WM-data Caran, which was acquired in January 1999. Growth elsewhere was restricted with the company’s vertically focused Industry Operations division increasing only 4% to SEK 1,120m ($135m) with a profit margin of 12%.
The company said that demand for systems design, development and administration, CRM, data warehousing and electronic payment systems was strong. It also reported considerable interest in its IntraWAP solution for services around the wireless application protocol (WAP), which was launched in the third quarter.
Meanwhile, WM-data’s largest business, Infrastructure Operations, fared even less well. The computer and network equipment outsourcing and reselling arm saw a slight revenue reduction (albeit less than 1%) to SEK 5,420m ($653m) in the first nine months of 1999, reportedly due to a slump in home PC sales offsetting growth in value-added services. Profit margin was low at 4%.
Significantly, given the increased strength of Swedish/Finnish rival TietoEnator Oyj in the Nordic services market since its merger on July 7, WM-data showed strong sales growth of 37% in Finland, taking revenue to SEK 1.57bn ($189m) over the first nine months. Revenues sourced from Denmark also increased, up 8% to SEK 1.84bn ($222m) while those from Norway fell 1% to SEK 490m ($59m). Sweden, however, remains WM-data’s main market with sales of SEK 4.95bn ($596m), up slightly by 3%.
To best deal with growth areas of its business, WM-data is creating three new operations as of January 1. eSolutions will be concerned with consulting and integration around internet solutions while eApplications concentrates on business systems and information solutions. Finally, WM-data Greenhouse will be a special unit designed to act as a nurturing ground for new business areas around technologies such as mobile and security.
