Temenos signs Nordea core banking replacement and upgrades guidance
GENEVA, Switzerland, 11 September 2015 – Temenos Group AG (SIX: TEMN), the market leading provider of mission-critical software to financial institutions globally, today announces that it has signed an agreement to provide Nordea with its new core banking platform and, as a result of this and improved market conditions, increases its guidance for 2015.
Commenting on the announcement, Temenos CEO David Arnott said:
“The Nordea deal is a key win for us, which together with generally improving market conditions, allows us to increase our guidance for the year. Large institutions are increasingly appreciating the need to replace core banking systems if they are to meet changing customer expectations in a digital age. Thanks to our packaged software approach, our cutting-edge technology and our global partnerships with some of the world’s leading consulting and system integrators, we are very well placed to capitalize on this market trend.”
Commenting on the announcement, Temenos CFO Max Chuard said:
“Tier 1 deals such as Nordea generate incremental license revenues both in the current quarter and on a multi-year basis, improving our revenue visibility for 2016 and also the medium term. We have upgraded our 2015 non-IFRS guidance for total software licensing growth to 42% - 46%, or USD 202m to USD 206m. This includes increased growth in software licenses of at least 21%, or USD 162m. We expect revised EBIT of USD 153m to USD 158m. Overall I am pleased with the performance of the business and I am confident in meeting the revised guidance.”
Revised 2015 guidance
Temenos revised its outlook for the year as follows*:
- Total non-IFRS software licensing growth of 42% to 46% (implying total non-IFRS software licensing revenue of USD 202m to USD 206m, up from USD 192m to USD 199m)
- This includes software licensing growth of 21%+ (implying software licensing revenue of at least USD 162m, up from USD 152m)
- Total non-IFRS revenue growth of 20.5% to 24.5% (implying non-IFRS revenue of USD 536m to USD 553m, up from USD 526m to USD 548m)
- Non-IFRS EBIT of USD of 153m to USD 158m, up from USD 150m to USD 156m, implying a Non-IFRS EBIT margin of 28.5%
- 100%+ conversion of EBITDA into operating cashflow
- Tax rate of 17% to 18%
*Assumes FX rates as disclosed in Q2 2015 results presentation - https://www.temenos.com/en/about-temenos/investor-relations)
Non-IFRS financial Information
Readers are cautioned that the non-IFRS information presented in this press release is subject to inherent limitations. It is not based on any comprehensive set of accounting rules or principles and should not be considered
as a substitute for IFRS measurements. Also, the Company’s non-IFRS financial information may not be comparable to similarly titled non-IFRS measures used by other companies. The Company’s non-IFRS figures exclude any deferred revenue write-down resulting from acquisitions, discontinued activities that do not qualify as such under IFRS, acquisition related charges such as advisory fees and integration costs, charges as a result of the amortisation of acquired intangibles, costs incurred in connection with a restructuring plan implemented and controlled by management, and adjustments made to reflect the associated tax charge relating to the above items.
Below are the accounting elements not included in the 2015 non-IFRS guidance:
- FY 2015 estimated deferred revenue write-down of approximately USD 20m
- FY 2015 estimated amortisation of acquired intangibles of USD 30m
- FY 2015 estimated acquisition related charges of USD 5m
- FY 2015 estimated restructuring costs of USD 8m
These estimates do not include impact of any further acquisitions or restructuring programmes commenced after 21 April 2015. The above figures are estimates only and may deviate from expected amounts.