Addnode Group Annual Report 2015 | Page 4

ADDNODE GROUP
Message from the CEO

INTERNATIONAL EXPANSION AND HIGH GROWTH

Addnode Group took a major step out into the international market in 2015 . We carried out our largest acquisition ever and became a leading European supplier of software and services for design , construction and product data information . We had strong growth of 19 per cent and increased our recurring revenue to 49 per cent of net sales . 2015 was truly a year to be satisfied with !
HOW WOULD YOU SUMMARISE 2015 ?
2015 was yet another year of growth , in which we increased our net sales by 19 per cent . We further expanded internationally through the acquisition of the German company Transcat PLM , our largest acquisition ever . All in all I am satisfied with the Group ’ s performance during the past year , with an ever-greater share of recurring revenue and stable earnings of SEK 168 m . We have a broad customer base and good diversification of risk , where no single segment or sector accounts for more than 10 per cent of our sales .
HOW DID THE PRODUCT LIFECYCLE MANAGEMENT AND DESIGN MANAGEMENT BUSINESS AREAS PERFORM DURING THE YEAR ?
Through the acquisition of the German company Transcat PLM we have now positioned ourselves as a leading European supplier of software and services for design , construction and product data information . The market is made up of customers both in traditional sectors such as the automotive , manufacturing and life sciences industries as well as new customers in the service and retail sectors . In the new , combined company TechniaTranscat we have already created many interesting business opportunities . In its first six months in the Group , Transcat PLM has made a strong contribution to earnings and holds great potential to combine its offering with its sister company Technia .
In the Design Management business area we are a marketleading supplier in the Nordic countries and the UK of software and services for design and construction . During the year , the business area was exposed to several severely hit markets , and despite this it still managed to increase its net sales . A change in the business model for Autodesk products in our subsidiary Cad-Q * has entailed that a large share of licensing revenue has now shifted over to a model where , instead of buying the licences , customers subscribe to the licences . Initially this will have an impact on earnings , but over time it will lead to an increase in recurring revenue and in the predictability of our earnings .
HOW DID THE PROCESS MANAGEMENT AND CONTENT MANAGEMENT BUSINESS AREAS PERFORM IN 2015 ?
In Process Management we have won several key tenders and built further upon our offering to public sector clients in Sweden and Norway . The public sector is under going an interesting transformation , where we have been a driver in simplifying and digitalising the dialogue between municipalities , authorities and the general public .
We have begun a consolidation of the business area ’ s product portfolio in an effort to strengthen customer benefit and ensure that we support our customers ’ needs for innovative business systems .
As for Content Management , we both developed and refined the customer offering , and continued the work with internal efficiency improvement . This work is beginning to generate results , and we have improved profitability significantly , albeit from low levels .
IN WHAT WAYS ARE YOU WORKING TO DEVELOP ADDNODE GROUP ’ S OFFERINGS ?
We have continued our work on increasing the content of our proprietary software in deliveries to our customers , which sets us apart from our competitors . The fact that we understand our customers ’ needs and challenges is ultimately proved by the high demand in the market for the products and services we are developing .

19 %

GROWTH IN NET SALES IN 2015 VS 2014

Germany

IN 2015 WE ACQUIRED TRANSCAT PLM AND ESTABLISHED OUR PRESENCE IN A NEW MARKET
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