DGAP-News: KPS AG

KPS confirms on the basis of the result in the first quarter of 2017/2018 the forecast for sales and earnings for the current business year

Unterföhring/Munich, 16 February 2018 - KPS AG (WKN: A1A6V4 / ISIN: DE000A1A6V48), Europe's leading management consulting firm for business transformation and process optimization in retail, posted a slight fall in sales to 38.1 million euros (Q1 2016/2017: 40.3 million euros) for the first quarter of 2017/2018 (1 October 2017 to 31 December 2017). One of the main reasons responsible for this was the disproportionate resource reduction at an important major customer, which could not be entirely compensated over the short term with new project initiatives. In spite of this development, sales were approximately at the level of the equivalent year-earlier period.

The consistent expansion of the company and the resulting increase in personnel expenses and large sales investments in future growth exerted a significant impact on earnings. At the same time these investments gratifyingly already started to pay off at the turn of the year with the acquisition of four new national and international transformation initiatives against strong competition. KPS AG also continued its consistent strategy of internationalization and steadfast expansion of the service portfolio by carrying out strategic acquisitions which similarly reduced earnings over the short term. On the basis of unaudited IFRS consolidated figures, the operating result (EBIT) came down to 3.1 million euros (Q1 2016/2017: 6.4 million euros). In the first quarter of 2017/2018, the EBIT margin amounted to 8.6 percent (Q1 2016/2017: 16.5 percent). Earnings after taxes amounted to 2.2 million euros compared with 5.3 million euros in the first quarter of 2016/2017 and the earnings per share amounted to 0.06 euros (previous year: 0.14 euros).

Leonardo Musso, Board Member of KPS AG explained: "The massive investments in our future growth exerted a negative impact on earnings in the first quarter. The acquisition of four big transformation initiatives which started at the beginning of the year, meant that we expect sales and earnings contributions from the beginning of the second quarter of 2017/2018. In spite of the challenges, sales in the first quarter are within the range of the year-earlier value. Since the beginning of the business year 2017/2018, the companies ICE Consultants Europe SL in Spain, Infront Consulting & Management GmbH in Germany, and Envoy Digital Limited in the United Kingdom were acquired. These are significant investments in the international growth of the Group. We are thereby complementing our service portfolio as a consulting firm for business transformation and process optimization. The consistent growth strategy we have been pursuing means that we will have a broader geographical base and at the same time expand our sector access. In spite of these future-oriented investments, we were able to outperform the competition in terms of profitability in line with expectations."

The Executive Board and the management of KPS AG confirm the forecast for the business year 2017/2018. In this context, Group sales are projected to amount to 160-170 million euros and EBIT 23-26 million euros. The projected figures include sales contributions from ICE Consultants Europe SL, Barcelona, Spain acquired on 2 October 2017, Infront Consulting & Management GmbH, Hamburg, Germany, acquired at the beginning of 2018, and Envoy Digital Limited, London, United Kingdom. The Supervisory Board and the Executive Board of KPS AG are maintaining their strategy of driving forward internationalization.

The detailed quarterly release for the first quarter of 2017/2018 is available for download with immediate effect at www.kps.com.

Unterföhring, 16 February 2018

KPS AG
The Executive Board

About KPS
KPS is Europe's leading transformation partner for companies wanting to radically realign their business to make it customer centric and implement innovative digital processes within a very short time. We work with companies from many different industries and support them from strategy consulting and sector-specific process chains right through to implementing cutting-edge technologies - all from a single source. KPS consultants are highly skilled in viewing a company holistically: They combine ERP processes with B2B and B2C e-commerce and customer-oriented marketing & sales processes. With integrated data management and targeted analyses, KPS creates emotional brand loyalty through unique customer experiences across all channels and regional borders. Particularly in a digital world focused on the customer, the ability to manage a company in an agile fashion is a key competitive advantage. The KPS rapid transformation method accelerates projects by up to 50 percent, and the extensive project experience of KPS consultants, along with their in-depth knowledge of the individual sectors, guarantees the success of each and every project initiative. KPS is part of a successful partner network and an SAP Gold Partner, SAP Hybris Platinum, Adobe Business, Intershop Premium, SAP ARIBA as well as an SAP Concur Customer and Implementation Partner. With around 1,000 consultants in 12 countries, KPS is expanding its global market position through ground-breaking projects in digital and technological change. Visit us at www.kps.com.​

KPS AG
Beta-Straße 10H
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Germany
Tel.: +49 (0) 89 356 31-0
Fax: +49 (0) 89 356 31-3300
Email: isabel.hoyer@kps.com

CROSS ALLIANCE communication GmbH
Susan Hoffmeister
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Germany
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Email: sh@crossalliance.de