Siili Solutions Plc, Financial statements bulletin, 1 January

Siili Solutions Plc, Financial statements bulletin, 1 January–31 December 2024 (unaudited)

YEAR 2024 FOR SIILI: Profitability affected by declined revenue, successful launch of the new data and AI focused strategy

Siili Solutions Plc Financial statements bulletin 13 February 2025 at 9:00 am (EET)

In 2024 we clarified our new strategy and successfully launched its implementation. We focused on strengthening our competitiveness and securing profitability in a continuously challenging market situation. However, the challenging market situation affected negatively on Siili's revenue and growth both domestically and internationally.

July-December 2024

Siili published its new strategy in August
Siili signed an agreement to purchase majority stake of the Finnish Integrations Group Oy
Siili appointed Maria Niiniharju as Siili’s VP, Private Business and member of Siili’s management team
Revenue for the second half of the year was EUR 52,713 (57,414) thousand, representing decline of 8.2% year on year
Adjusted EBITA for the second half of the year was EUR 2,100 (3,732) thousand, which corresponds to 4.0% (6.5%) of revenue

January-December 2024

We focused on streamlining our organization and creation of our new strategy
We strengthened data and AI expertise through training and recruitment
We achieved 10th place in the Young Professional A raction Index survey by Academic Work
Full-year revenue amounted EUR 111,899 (122,702) thousand, representing decline of 8.8% year on year
Adjusted EBITA was EUR 5,409 (8,742) thousand, which corresponds to 4.8% (7.1%) of revenue

	H2/2024	H2/2023	2024	2023	Q4/2024	Q4/2023
Revenue, EUR 1,000	52,713	57,414	111,899	122,702	28,589	30,365
Revenue growth, %	-8.2%	-3.4%	-8.8%	3.7%	-5.9%	-6.7%
Organic revenue growth, %	-8.2%	-5.5%	-8.8%	0.1%	-5.9%	-6.7%
Share of international revenue, %	30.2%	27.7%	29.0%	26.7%	28.8%	25.8%
Adjusted EBITA, EUR 1,000	2,100	3,732	5,409	8,742	1,403	2,471
Adjusted EBITA, % of revenue	4.0%	6.5%	4.8%	7.1%	4.9%	8.1%
EBITA, EUR 1,000	2,058	3,399	4,752	8,409	1,361	2,138
EBIT, EUR 1,000	1,482	2,763	3,592	6,909	1,075	1,844
Earnings per share, EUR	0.20	0.18	0.43	0.61	0.18	0.14
Number of employees at the end of the period	942	1,007	942	1,007	942	1,007
Average number of employees during the period	954	1,034	975	1,026	944	1,030
Total full-time employees and subcontractors (FTE) at the end of the period	1,033	1,091	1,033	1,091	1,033	1,091

Outlook for 2025 and financial goals for 2025-2028

Revenue for 2025 is expected to be EUR 108-130 million and adjusted EBITA EUR 4.7-7.7 million.

On 26 November 2024, the company announced the financial goals for the years 2025–2028 as follows:

Annual revenue growth of 20 percent, of which organic growth accounts for about half.
Adjusted EBITA 12 percent of revenue.
The aim is to keep the ratio of net debt-to-EBITDA below two.
The aim is to pay a dividend corresponding to 30–70 percent of net profit annually.

CEO TOMI PIENIMÄKI:

2024 was another challenging year from a market perspective, both for Siili and the entire IT service sector. During the year, we focused on crystallising our strategy and creating a foundation for stronger competitiveness and profitability.

The market situation affected both Siili’s revenue and the rate of growth both domestically and internationally. Full-year revenue amounted to approximately EUR 112 million, representing a decline of 9% year on year. The share of international operations in the Group’s revenue continued to increase and rose from the previous year’s level of 27% to 29% in 2024.

The slowdown in growth also weighed on profitability. Adjusted EBITA for the year was EUR 5.4 million, which corresponds to about 5% of revenue. This year, we aim to improve Siili’s profitability by focusing on operational efficiency and growth with focus on the Data and AI business.

Despite the challenges of the operating environment, last year was, however, successful for Siili in many ways. During the first half of the year, we focused on designing our new strategy and streamlining the organisation. We also launched a three-level training programme in artificial intelligence for our consultants and continued to strengthen the data and AI expertise of the Siili team through both training and recruitment throughout the year.

Our new strategy has been well received

In the new strategy published in August, we placed data and artificial intelligence at the core of the strategy. Our objective is to be a pioneer in the AI transition as a developer of generative AI solutions and as an AI partner that reinforces its customers’ competitiveness.

We have now three strategic priorities that strengthen our position as a leader in leveraging AI:

Significant growth in Data and AI business
Pioneer in AI-powered digital development
Community of top talent

Our updated strategy and our promise “Impact driven, AI powered” have been well received in the markets. During the year, we were selected as a partner for several AI and data projects in line with our strategy. Towards the end of the year, we had many successful openings consistent with the strategy in projects dealing with, for example, AI strategies, training, and implementation. We will continue to focus on expanding our business with strategic customers and building long-standing partnerships.

We focus on improving our profitability

We continue to improve our operational efficiency. We will focus in particular on capacity and utilization management, cost efficiency, offer development and pricing optimization. Improving profitability is progressing according to plan in stages. We have made a concrete action plan to improve our efficiency and profitability and we will implement it with determination and monitor its progress.

Last year, we also started to develop our operating models towards more data-driven decision-making and better forecasting. In addition, we are strongly investing in the implementation of a new management model that increases efficiency, recruitments that support the strategy and optimization of subcontracting. We strive to seek profitable growth in growth areas in line with the strategy, while firmly protecting profitability in more challenging market segments.

We are strengthening our community of top talent

At the beginning of November, we strengthened the data and AI expertise of the management team when Maria Niiniharju took up the position as the leader of Siili’s Private Business and became a new member of Siili’s management team. In accordance with our strategy, we also expanded our competence through recruitment of data and AI experts, who we have now 43% more compared to previous year. Towards the end of the year, we strengthened our integration expertise by signing an agreement to purchase a majority stake in Integrations Group Oy. With Integrations Group, we will be a stronger partner for our customers in various demanding AI and data integration projects.

We aim to be the best community for digital development professionals, and we continued to develop our culture and leadership further last year. Our efforts to develop Siili’s community were recognized in autumn when Siili achieved 10th place in the Young Professional Attraction Index survey by Academic Work.

In 2025, we will celebrate Siili’s 20th anniversary. With two decades of innovation and growth under our belt, this is a good time to continue Siili’s journey by focusing on the implementation of the strategy and the improvement of profitability during the year. Although we cannot see immediate signs of an improvement in market conditions, our successes in 2024 have proven the performance of our strategy. I want to extend my thanks to the entire Siili team and our customers for the past year. I am looking forward to the opportunity to build new and innovative solutions at the cutting edge of the AI transition.

RISKS AND UNCERTAINTY FACTORS

Siili is exposed to various risk factors related to its operational activities and business environment. The realisation of risks may have an unfavourable effect on Siili’s business, financial position or company value. The most significant risks related to Siili’s operations are described below, along with other known risks that may become significant in the future. In addition, there are risks that Siili is not necessarily aware of and which may become significant.

The loss of one or more key clients, a considerable decrease in purchases, financial difficulties experienced by clients or a change in a client’s strategy with regard to the procurement of IT services could have a negative effect on the company.
Failure to achieve recruitment goals in terms of both quality and quantity, and failure to match supply to customer demand in a timely manner.
Probability and adverse effects of the realisation of the aforementioned risks are more likely in an uncertain economic environment.
Failure in pricing, planning, implementation and improving cost efficiency of customer projects.
Loss of the contribution of key personnel or deterioration of the employer’s reputation.
Realisation of information security risks, for example, as a result of data breach and/or human error by an employee.

General negative or weakened economic development and the resulting uncertainty in the clients’ operating environment. The general economic cycle and changes in the clients’ operating environment can have negative effects through slowing down, postponing or cancelling decision-making on IT investments.

Russia’s war of aggression against Ukraine has not had and is not expected have a direct impact on Siili’s business. However, the general uncertainty and inflation in 2024 continued to affect in particular our clients’ investment decisions, thereby also weighing on Siili’s business. Slow recovery of the economy is expected to continue to affect Siili’s business and growth opportunities also in the current financial year. According to management observations and estimates, the impacts of the market environment in the financial year 2024 were moderate, and they are expected to reduce in 2025. We prepare for these effects by taking care of customer satisfaction and cost efficiency.

EVENTS AFTER THE END OF THE FINANCIAL YEAR

Acquisition of Integrations Group Oy

On 18 November 2024, Siili Solutions Plc announced it had signed an agreement to purchase a stake of 51% of the shares in the Finnish company Integrations Group Oy. The transaction in Integrations Group Oy shares was completed on 2 January 2025. Siili is committed to purchasing the remaining 49% of shares in Integrations Group Oy over the coming years in parts as detailed in the shareholders’ agreement; hence, Integrations Group Oy is consolidated 100% in the Siili Group as of 2 January 2025.

Integrations Group Oy is a company specialising in integration implementations and services, based in Espoo and Tampere. The company’s unaudited revenue for the financial year 2024 was EUR 2.2 million, and its operating profit amounted to EUR 0.3 million. The company has 13 employees. Integrations Group Oy will continue to operate as a stand-alone company under its own brand.

The acquisition of the majority stake in Integrations Group executes on Siili’s strategic objective to expand its business in the growing data and generative AI market.

The acquisition does not have a material effect on the Siili Group’s revenue, adjusted EBITA or balance sheet values. The company will prepare an acquisition cost calculation under IFRS 3 during the first year-half.

DIVIDEND PROPOSAL

In line with the dividend policy approved by its Board of Directors, Siili seeks to distribute 30–70% of its profit for the period to shareholders. In addition, an additional profit distribution can be made.

On 31 December 2024, the distributable assets of the parent company of Siili Solutions Plc amounted to EUR 35,291,522.61, including the profit for the period EUR 1,629,162.50. The Board of Directors proposes to the Annual General Meeting 2025 that a dividend of EUR 0.18 per share be paid for the financial year 2024. According to the proposal, a total dividend of EUR 1,460,215.62 would be paid. The proposed dividend represents approximately 42% of the Group’s profit for the financial year.

No significant changes have taken place in Siili’s financial position since the end of the financial year. The company has a good level of liquidity, and the Board believes that the proposed dividend will not pose a risk to liquidity.

FINANCIAL CALENDAR FOR 2025

Siili will hold a results announcement event for analysts, portfolio managers and the media on 13 February 2025 at 1:00 p.m. The presentation materials will be published on the company website after the event.

The Annual Report 2024 will be published in electronic format on the company website on 14 March 2025.
The Annual General Meeting will be held on 8 April 2025.
The business review for 1 January–31 March 2025 will be published on 22 April 2025.
The half-year report for 1 January–30 June 2025 will be published on 12 August 2025.
The business review for 1 January–30 September 2025 will be published on 21 October 2025.

Helsinki, 13 February 2025

Board of Directors, Siili Solutions Plc

FURTHER INFORMATION:

CEO Tomi Pienimäki

tel. +358 40 834 1399

CFO Aleksi Kankainen

tel. +358 40 534 2709

SIILI SOLUTIONS IN BRIEF:

Siili Solutions Plc is a unique combination of a digital agency and a technology powerhouse. We believe in human-centricity in everything we deliver. Siili is the go-to partner for clients seeking growth, efficiency and competitive advantage through digital transformation. Siili has offices in Finland, Germany, Poland, Hungary, Netherlands, United Kingdom, Austria and USA. Siili Solutions Plc shares are listed on Nasdaq Helsinki Ltd. Siili has grown profitably since it was founded in 2005. / www.siili.com

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