Markets and Digia's Business Operations

Domestic segment:

The Integration, Analytics and Site Optimization business performed extremely well during the reporting period. Besides enjoying active demand from its existing clientele, Digia signed a number of new customer agreements and recruited more personnel to meet the growing demand. Major investments were made in the segment in Digia's own workforce management software (Digia Tempus product line) and the related new business development. The segment was also able to improve its profitability from the previous year.

Similarly, demand for ERP systems was healthy, with Digia's own software products showing positive development. Investments in product and service offering in integrated e-commerce, analytics and mobility solutions have clearly boosted demand across the segment. Demand for operating and lifecycle services also increased. However, significant differences in demand between sectors continued to exist, and sales cycles were, on occasion, quite long. Demand for services in the Finnish financial sector was particularly good, with order and bid volumes at a healthy level.

Customers' cost pressures affected the pricing of tailored solutions and services, and thereby to net sales and profitability. Furthermore, challenges experienced with a few individual projects also eroded profitability. A clear need was identified in the customer base for comprehensive services and for the development and acquisition of a variety of service centres. In the future, developing new service models will be an increasingly important part of our tailored solutions offering. The order book is reasonably strong. During the review period, Digia invested in the development and streamlining of its tailored solutions offering, particularly in the areas of cloud services, service management and mobility.

Qt segment:

Although the Qt business failed to reach its net sales targets for the review period, the situation improved in the final quarter and net sales showed strong growth.

As expected, the Qt business recorded a loss for the review period. This could be attributed to the company's determined and strong investments in business development to enable future growth.

The Qt user ecosystem has seen powerful growth. The new version, Qt 5.3, launched in May 2014 has been downloaded more than a million times. Feedback from users has been extremely positive.

During the period, Digia continued to implement the previously reported Qt product development plans. During the period, a new Qt 5.4 version was launched involving changes in the open source code licence. The objective of licensing changes is to promote the sale of licences to commercial players. Overall, special attention has been paid to sales enhancement, with several development projects currently in progress.