With the structural reorganisation that took effect at the beginning of 2014, Digia hopes to enhance the focus of its various business units and the investments made to improve their efficiency. Within the Qt business, the emphasis is clearly on creating the necessary conditions for growth. At the same time, the company works to maintain the profitability of that business. In domestic operations, the company will look to bring profitability to a good level and to achieve organic growth that at least matches the general market rates. Besides organic growth, the company will actively pursue opportunities to make carefully considered business acquisitions that support its strategy.
The company expects the Finnish IT market to remain at roughly the previous year’s level in 2014.
Efforts will continue in order to develop the company’s customer understanding and sales and service portfolio, to ensure that it can offer increasingly competitive services and solutions for boosting its customers’ business efficiency.
The company expects demand for its ERP systems to remain good, although increased caution on the customer side and lengthening sales cycles may have an effect on future order intake and requests for tenders.
Demand for integration services is also expected to stay at a good level. The company predicts that the net sales for this unit will continue to grow, although at a slightly slower rate than in 2013 dues to customers’ cost-saving pressures.
The company believes that the cost pressures felt by customers and the resulting caution will mostly affect demand for customer-specific solutions and services, where decision-making may be delayed, especially in larger projects.
The Qt order book is healthy, considering the time of year and general market situation, and the company expects demand to continue growing even in the large enterprises customer segment. Contract lead times are very long in this market, however – typically 6–18 months – which can cause significant fluctuations between quarters in terms of net sales and, particularly, profitability.
In future the Chinese and Russian units will form part of the Qt segment and will focus on Qt licence sales.
The company predicts a continued strong growth of income generated by the Qt business in 2014. Significant investments will continue to be made in developing the Qt business and Qt technology, while the company will further reinforce its sales network, especially in Asia. Investments made with the aim of securing growth will have a negative impact on profitability, which is why the company expects the profitability of the Qt business to be only slightly positive in 2014.
Overall, the company predicts its consolidated net sales for 2014 to grow organically at a rate exceeding that of the general market. Overall profitability is expected to rise from last year’s levels, but further investments in growing the Qt business will continue to hold back the whole company’s profitability.