In a largely positive market environment for IT companies that was characterised by a marked willingness to invest, growth was generated by attracting new customers, building on existing customer relationships and hiring additional staff to bring the number of employees up to 3,280 (+ 19 %). Sales rose in all important core sectors. Business volume also posted dynamic growth outside of Germany. The number of employees in Turkey increased by 77 % to 177, and the new subsidiaries in Bulgaria and Spain now employ over 60 developers and consultants. All told, licensing and maintenance income from in|sure and FirstSpirit, adesso's own products, increased. The acquisition of three initial new customers for the health insurance industry solution completed in late 2017 and the further improvement of earnings following the US market launch of FirstSpirit were of particular strategic importance.
Earnings improved and operating profit was generated at all international companies except for the two new subsidiaries in Bulgaria and Spain. The core business in Germany was the main driving force behind the 22 % increase in EBITDA to a new record high of EUR 31.1 million, bringing the EBITDA margin up from 7.9 % to 8.3 %. Consolidated earnings increased by 18 % to EUR 13.3 million, with earnings per share rising 21 % to EUR 2.17.
Given liquid assets of EUR 45.9 million, net liquidity after the deduction of financial liabilities stood at EUR -2.2 million as at 31 December 2018 following EUR 0.3 million in the previous year.
adesso started 2019 with a series of innovation and growth initiatives. With the Automotive & Transportation Line of Business having successfully gained a foothold in the corresponding sector on the back of 37 % growth to over EUR 20 million in sales last year, the newly founded Manufacturing Industry Line of Business addresses the mechanical engineering industry as a new core sector. The mechanical engineering industry is an important sector, especially in Germany. The Group-wide expertise in data organisation and analysis has been pooled in the new Data & Analytics Line of Business to serve as a foundation for providing customers with the best possible advice and support regarding their use of AI technologies. Two additional subsidiaries are slated to open in Hungary and the Netherlands.
The company is once again stepping up the pace of innovation and investment in the product segments. With regard to the in|sure family of products for insurance companies, adesso aims to take a first cloud-based customer installation live, complete the Group's PayTras payment module and invest in projects such as the technical integration of FABIS and CollPhir, the products and enhancements for commission calculation and company pensions that were acquired in 2018. For the FirstSpirit content management system, the Group is developing starter kits to speed up product roll-out, a fully new web client and innovative architecture elements for the future of headless CMS.
In its new Salesforce business area, adesso is striving to quickly become one of the leading partners in Central Europe for the industry-specific development of customer- and marketing-oriented solutions based on products from the fast-growing provider of cloud solutions.
Sales are set to rise by at least 9 % to more than EUR 410 million in 2019. Given the continuation of the active recruitment policy, a marked deterioration in economic forecasts and increased investment in products, the Group expects to see a slight decline in capacity utilisation and the operating margin. adesso anticipates EBITDA of between EUR 40 million and EUR 45 million (corresponding to EBITDA of EUR 30 million to EUR 35 million prior to the first-time effect from IFRS 16). The company aims to ensure that the subsidiaries in Bulgaria and Spain, both of which were just established in 2018, start generating profits. The Group will continue pursuing its active M&A strategy in 2019.
The complete annual report and tables comparing key performance figures over previous reporting periods, are available at www.adesso-group.de/en/ in the Investor Relations section.
