asknet AG Reports 22% Revenue Increase in the First Half of 2018 and Is on Track for Further Accelerated Growth

  • Consolidated sales revenues increased by 22 percent to 41.41 million euros (1H 2017: 34.08 million euros)
  • Gross profit of 4.34 million euros (1H 2017: 4.31 million euros)
  • Negative earnings before taxes (EBT): -0.24 million euros, but losses reduced by over 50 percent compared to the same period of 2017 (1H 2017: -0.51 million)
  • Guidance 2018: steady growth in revenues and gross profit, EBT remains negative due to additional hiring and technology investments
  • Growth plan 2018-2020: accelerating current growth through additional investments including capital increase scheduled for completion in Q4 2018

asknet AG, an ecommerce services company majority owned by the Swiss-listed international technology and media company The Native SA (www.thenative.ch), achieved a strong increase in consolidated sales revenues of 22 percent to 41.41 million euros in the first six months of 2018. The increase is partly due to the high number of new customers acquired in the eCommerce Solutions Business Unit in the first half of the year. In addition, new shops that had already been set up in the second half of 2017 were further ramped up. asknet AG also gained new customers in the Academics Business Unit, which contributed to the good sales revenues’ development.

Gross profit, the key performance metric for the asknet Group’s business, rose from 4.31 million euros in the prior-year period to 4.34 million euros in the first half of 2018. The gross profit margin in relation to sales revenues declined from 12.6 percent to 10.5 percent. The lower growth rate of the company’s gross profit compared with the strong sales revenue growth is mainly explained with longer income recognition periods in the Academics Business Unit. In addition, some projects were rescheduled to the second half of the year.

Overall, the asknet Group improved earnings before tax (EBT) to -0.24 million euros in the first six months of 2018, after -0.51 million euros in the same period of the previous year. The consolidated net result for the period amounted to -0.47 million euros (previous year: -0.51 million euros).

In the eCommerce Solutions Business Unit, the successful ramp-up of new shops in the reporting period led to a 29 percent increase in revenues, totaling 30.72 million euros (previous year: 23.81 million euros). Gross profit in this business unit also increased significantly by 17 percent to 3.21 million euros. The under-proportional increase is in particular due to the larger number of small and medium-sized customers, which results in a weaker margin on the one hand, but a broader and more stable customer spectrum on the other. In the Academics Business Unit, asknet recorded a 4 percent increase in sales to 10.69 million euros. Gross profit fell from 1.56 million euros to 1.13 million euros. The 27 percent decline is mainly due to completed transactions that were not yet booked to gross profit and project postponements to the second half of the year.

Taking into account the strong results from the first half of the year, the company’s Executive and Supervisory Boards approved on September 26, 2018 the new growth plan for 2018-2020. It aims at providing asknet AG with additional capital to achieve a larger scale of business and sustainable long term profitability. The main focus lies on reinforcing staff in the areas of sales and marketing and developing new technologies and systems allowing for faster onboarding new clients and improving their retention rates. In connection with the new growth strategy, the company also revised its targets for 2018 and onwards. While asknet is continuing to forecast a strong growth in sales revenues and gross profit for the full year 2018, negative earnings before taxes (EBT) in a high six-digit range are accepted in the current year in favour of stronger growth. In parallel to continued high investments, the growth plan aims at further accelerating top-line-growth and exceeding the break-even point in 2019. By 2020, the company intends to at least double its sales revenues and gross profit in comparison to the levels budgeted for the full year 2018, and to achieve strong and sustainable profitability on an EBT basis.

To finance the growth plan, asknet AG’s Executive Board with approval of the Supervisory Board recently decided to execute a capital increase from cash contributions, issuing up to 93,395 new shares at a subscription price of EUR 10.5 per share. Shareholders are granted their statutory subscription rights. An investor, who is currently not a shareholder of asknet AG, will guarantee the capital increase and underwrite the shares that were not subscribed by existing shareholders until the end of the subscription period. The public offer in connection with the capital increase is to be made without a prospectus, but with a securities information sheet, which has been submitted for approval by the Federal Financial Supervisory Authority (BaFin). The approval will presumably be obtained in the course of the day. The subscription offer is expected to be published in the Federal Gazette (Bundesanzeiger) on October 4, 2018, with the capital increase to be fully exercised by the first week of November 2018.

Selected key figures of the Group

January 1 – June 30, 2018

Sales revenues: 41.41 million euros
Gross profits: 4.34 million euros
Gross profit margin (of sales revenues): 10.5%
EBT: -0,24 million euros
Net result for the period: -0,47 million euros
Financial debt: –

January 1 – June 30, 2017

Sales revenues: 34.08 million euros
Gross profits: 4.31 million euros
Gross profit margin (of sales revenues): 12.6%
EBT: -0.51 million euros
Net result for the period: -0.51 million euros
Financial debt: –

The full report on the first six months of 2018 is available on the company’s website at www.asknet.com as of today.

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censhare AG parts with CEO Dieter Reichert and CFO Stephan Wehselau

The separation takes place against the background of a different view of the company’s strategic orientation among three of the four main shareholders, and thus with the vast majority of shareholdings, as well as the Supervisory Board on the one hand, and Dieter Reichert and Stephan Wehselau on the other. “The strategic orientation was unclear, and the failures to meet targets in the last quarters were again significant and unacceptable”, Dr Anastassia Lauterbach, Chair of the Supervisory Board said, explaining the committee’s decision.

The Supervisory Board is convinced that Jürg Weber is an excellent interim solution, as he is familiar with the organization for over 10 years and has demonstrated a high level of strategic competence and leadership as Managing Director in building up the highly successful Swiss subsidiary. “I thank the Supervisory Board for the trust it has placed in me. The clear focus of our work in the coming months will be to place censhare’s core competencies at the center of our thoughts and actions.”

Like the founding shareholders, Robert Motzke and Walter Bauer, and the strategic investor, the Supervisory Board supports the company 100 percent and is firmly convinced of censhare’s successful future with its leading software solution, established customer relationships, committed employees and innovative strength. Together with the Executive Board, it will work with great confidence and commitment to shape this future.

The Supervisory Board expressly thanks Dieter Reichert and Stephan Wehselau for their many years of work. Since censhare AG was founded, Dieter Reichert in particular has worked tirelessly for the company as CEO and mastermind.

We wish both of them all the best for their future.

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asknet AG Annual Shareholders Meeting Elects New Chairman, the New Supervisory Board Sets the Path for Further Growth of the Business

asknet AG held its annual shareholders meeting today, which approved with 99.9% of the vote the annual report and a number of governance changes, all in line with the acquisition of control of asknet AG by the Swiss-listed The Native SA in November 2017 and asknet’s ongoing refocus on the profitable growth strategy across all of its business units.

Following the deep restructuring and transformation of asknet into a profitable business over recent years (the company returned to profitability in 2017), Mr. Tobias Kaulfuss, the former CEO of asknet AG, was elected as Chairman of the Supervisory Board of the company, with each of Joern Matuszewski and Norman Hansen continuing on the board of asknet AG. Mr. Sergey Skatershchikov, the Chief Financial Officer of asknet AG, was appointed the Chief Executive Officer of asknet AG.

The new Supervisory Board of asknet AG convened on June 28 after the annual shareholders meeting and has approved Mr. Skatershchikov’s proposal to institute a new governance structure for asknet’s second level of management with immediate effect, with Mr. Skatershchikov to act as Chairman of the Management Board, and other management board members to include Mr. Jan Schoettelndreier (head of eCommerce Solutions business unit), Mr. Michael Baumann (head of Academics business unit), Mr. Hubert Maurer (head of finance and administration), Mr. Noel Kienzle (head of technology and data security), and Mr. Aston Fallen (head of business development and marketing).

The new management board structure is aimed at improving the quality of executive decision-making as asknet moves into the fast growth stage of its business development. It assigns greater importance to technology and data security through an expanded executive mandate for Mr. Kienzle that now covers the entire asknet AG organization, and introduces the new role of the head of business development and marketing to reflect the increased focus on sales and key accounts management in the asknet AG.

“Over the last several years asknet AG has been restructured into a very efficient and customer-centric organization and is now in a great position to take further investment and support from its majority shareholder, The Native SA, to execute on the long term profitable growth and market consolidation plans”, commented Mr. Tobias Kaulfuss, the Chairman of the Supervisory Board of asknet AG.

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Annual General Meeting of SMA Solar Technology AG Discharges Managing Board and Supervisory Board and Resolves Dividend

The shareholders of SMA Solar Technology AG (SMA/FWB: S92) granted full discharge to the Managing Board and Supervisory Board for the 2017 fiscal year with a clear majority of over 99% and over 95% at today’s Annual General Meeting in Kassel. The remaining items on the agenda were also passed with a large majority. More than 250 shareholders attended the 2018 Annual General Meeting of SMA Solar Technology AG, and 89% of those with voting rights were present. The Annual General Meeting followed the suggestion of the Managing Board and Supervisory Board and approved the dividend payout of €0.35 per qualifying bearer share for the 2017 fiscal year.

“SMA again demonstrated its high level of flexibility in the last fiscal year,” said SMA CEO Pierre-Pascal Urbon. “In 2017, despite the regional shift in demand, SMA was able to generate annual net income at the level of the previous year. For SMA’s future success, we will further strengthen our core business with PV inverters while ramping up our activities in the field of energy management. Our shareholders supported this strategy at today’s Annual General Meeting.” In the 2017 fiscal year, SMA generated sales of €891.0 million. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to €97.3 million. Net income amounted to €30.1 million. With a payout totaling €12.1 million, the payout ratio in relation to net income amounts to 40.2%. The depository banks will begin dividend payments on May 25, 2018.

In light of the development in the first quarter of 2018 and the continued high order backlog, the SMA Managing Board confirms its sales and earnings guidance for the 2018 fiscal year, which forecasts sales of between €900 million and €1,000 million and EBITDA of between €90 million and €110 million. For the first time, EBITDA includes expenses of more than €10 million for setting up the digital business. The Managing Board estimates that depreciation and amortization will amount to approximately €50 million. The future payout rate will be between 30% and 60%.

The presentation and the speech given by the Managing Board at the Annual General Meeting, along with further information, can be found on the internet at www.sma.de/en/investor-relations/annual–general-meeting.

A press picture can be downloaded here .

Disclaimer:

This press release serves only as information and does not constitute an offer or invitation to subscribe for, acquire, hold or sell any securities of SMA Solar Technology AG (the “Company”) or any present or future subsidiary of the Company (together with the Company, the “SMA Group”) nor should it form the basis of, or be relied upon in connection with, any contract to purchase or subscribe for any securities in the Company or any member of the SMA Group or commitment whatsoever. Securities may not be offered or sold in the United States of America absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended.

This press release can contain future-oriented statements. Future-oriented statements are statements which do not describe facts of the past. They also include statements about our assumptions and expectations. These statements are based on plans, estimations and forecasts which the Managing Board of SMA Solar Technology AG (SMA or company) has available at this time. Future-oriented statements are therefore only valid on the day on which they are made. Future-oriented statements by nature contain risks and elements of uncertainty. Various known and unknown risks, uncertainties and other factors can lead to considerable differences between the actual results, the financial position, the development or the performance of the corporation and the estimates given here. These factors include those which SMA has discussed in published reports. These reports are available on the SMA website at www.SMA.de. The company accepts no obligation whatsoever to update these future-oriented statements or to adjust them to future events or developments.

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asknet AG performs successfully in Q1

 

– eCommerce Solutions Business Unit wins six new customers
– Academics Business Unit continues to expand its sales partnerships
– Full-year forecast confirmed: clearly higher gross profits and positive result

asknet AG, part of the Swiss-listed international technology and media company The Native SA (www.thenative.ch), looks back on a successful business performance in the first three months of 2018.

The most important operational developments in the Academics Business Unit included the implementation of the new sales partnerships and the creation of a partner network for the ongoing internationalization of the distribution channels. The partnership with ANSYS, the world’s leading manufacturer of simulation software, was intensified and the first major licenses were sold to customers from the research and educational sectors. asknet also won a tender by the federal state of Saxony to supply the state’s universities with Microsoft licenses. As announced in the press release dated April 6, 2018, asknet launched a new Microsoft Office 365 complete package, for which three customers have already been won. More customers are about to sign the corresponding contracts soon.

“We have an attractive portfolio of software and hardware from leading manufacturers in the academic sector. We believe that the further internationalization of our offerings holds vast opportunities for future growth and rely on strong partners to support us in expanding our sales activities in the target regions,” says Michael Baumann, Head of the Academics Business Unit.

The eCommerce Solutions Business Unit won six new customers in the first three months of 2018. The corresponding shops have largely been completed and will contribute to revenues and earnings as of the second quarter. In addition, customizing projects were implemented for several new customers, which help to further intensify asknet’s customer relationships. The Business Unit has the biggest growth potential in Asia, where many new manufacturers are trying to gain a foothold in the global online market and rely on full-service suppliers such as asknet. The Business Unit also aims to further internationalize its operations, especially in the US market.

“We had a very good start to the year 2018 and will work on a large number of new customer projects in the second quarter. Our market remains hotly contested but very dynamic. Building on the sales successes of the past two fiscal years, we were able to improve our market position significantly and meanwhile have a continuous pipeline of new customers,” says Jan Schöttelndreier, Head of the eCommerce Solutions Business Unit.

As announced in the ad-hoc release dated May 3, 2018 the CEO of asknet AG, Tobias Kaulfuss, will resign from the Executive Board at the Annual General Meeting on June 28 but has simultaneously been proposed for election to the Supervisory Board. His successor on the Executive Board is Sergey Skatershchikov, Chief Financial Officer of asknet AG and Chairman of the Board of Directors of the majority shareholder, The Native SA.

“Since I took up office, asknet Group has gone through a thorough change process during which it has laid the professional basis for dynamic growth. Step by step we will now be able to reap the fruits of this process. I would like to take this opportunity to thank our employees, customers and partners for their support during this time. We see great potential for the future for both Business Units, which are today positioned as independent, powerful units, with their own organization, human resources and experienced management team,” says Tobias Kaulfuss, CEO of asknet AG, adding that the company’s strategic position has changed fundamentally since the entry of The Native SA. “We can now build on the network, the expertise and the financial muscle of our new majority shareholder. I am therefore very optimistic about the future of asknet Group, which I hope I will be able to serve in the future as a member of the Supervisory Board.”

The Executive Board of asknet AG continues to project a strong increase in consolidated gross profits as well as positive earnings before taxes (EBT) for the full year 2018.

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Knorr-Bremse reaches agreement with employee representatives up to 2020

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– Employees will receive a one-off payment of EUR 300 in April 2018 – A 5.0% pay rise will come into effect on July 1, 2018
– Two further 1.5% pay rises will come into effect on July 1, 2019 and July 1, 2020
– From 2019, in July Knorr-Bremse will pay an annual bonus of 12% of the monthly wage, depending on the commercial situation of the Company
– Attractive working time autonomy regulations will be introduced for white-collar workers

Knorr-Bremse and the employee representatives have negotiated an attractive agreement for the approximately 4,500 employees at almost all Group companies in Germany that are not covered by a collective agreement. The deal combines a financial component – comprising 10% more pay over the next three years – with flexible working time arrangements that take both employees’ interests and operational requirements into account. The agreement ensures that Knorr-Bremse’s employees will share in the Company’s success.

“In an age of ever-increasing globalization and digitalization, we need to focus more strongly on operational requirements and our employees’ interests. In direct negotiations with the employee representatives we have been able to deliver on this aim,” says Klaus Deller, Chairman of the Executive Board of Knorr-Bremse AG. As well as the financial aspects of the pay rise, the agreement also includes the introduction of flexible working time arrangements. “We firmly believe that working time autonomy for white-collar workers is in the best interests of our employees,” says Deller. Accordingly, from July 2018 all white-collar workers will be given the option of switching to a flexible model that gives them freedom to choose when they perform their work.

The agreement also allows employees to temporarily or permanently reduce or increase their regular working week, provided that this is compatible with operational requirements. Other measures include a one-time opportunity for employees to convert a pay rise into a reduction in their working week.

For an international player like the Knorr-Bremse Group, it is becoming more and more important to be able to respond flexibly to market requirements. According to Klaus Deller, this means that it is important “to find in-house solutions tailored to Knorr-Bremse’s particular situation. We must be capable of responding rapidly and flexibly to market opportunities in order to grow our business for everyone’s benefit. After all, you have to generate earnings before you can distribute them.” “Together we have reached an agreement that provides our employees in Germany with the security to plan ahead as far as 2020. We were also able to negotiate attractive rulings on flexible working time and even working time autonomy,” adds Michael Jell, an employee representative on the Supervisory Board of Knorr-Bremse AG.

 

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Transformation and Generational Change

The Lapp family, the owners of the Lapp Group, started planning for the generational change at an early stage. At Lapp, that is simply part of the response to rapid social and economic change. This change entails enormous adjustments for the family-owned company as well as the economy at large. Since 2017, the third generation of the Lapp family has also been taking up responsibility within the company.

For almost 60 years, Ursula Ida Lapp (87) worked to build up the company, mould it and turn it into a global player. In 2015, she passed the role of Chair of the Supervisory Board of Lapp Holding AG on to her eldest son, Siegbert Lapp (65). His younger brother Andreas Lapp (63) is Chairman of the Board of Lapp Holding AG. Ursula Ida Lapp maintains her link with the company as Honorary Chair of the Supervisory Board.

Until June 2017, Ursula Ida Lapp remained Chair of the Supervisory Board of U.I. Lapp GmbH, which was named after her and is the single largest company within the Lapp Group. Andreas Lapp assumed this role in July 2017. At the same time, he transferred his role as CEO of U.I. Lapp GmbH to Ursula Ida Lapp’s grandson Matthias (35). This makes Matthias Lapp responsible for Europe, the Middle East, Africa and South America. In addition, his brother Alexander Lapp (33), who is the second member of the third generation of the founding Lapp family, assumed global responsibility for the future topic of digitalisation and the further development of e-business.

“Lapp is a family company and will stay that way. It was always important to us for younger generations to be introduced when the time was right,” says Andreas Lapp. “Particularly in light of rapid digital change and a globalised economy, it’s now more important than ever to incorporate the knowledge, new ideas and perspective of the younger generations into our company.”

Lapp and social change
Lapp isn’t just concerned with its founding family, however: “If we want to attract the best employees – which we definitely do – then we need to fulfil the wishes of every generation,” says Andreas Lapp. Yet the wishes of different generations are very varied. The members of so-called Generation Z (born around 1995 and after) who are currently flooding onto the job market have very specific preconceptions of their career development and the part that work should play in their lives, just like the Baby Boomers and Generations X and Y. On the other hand, members of Generation X (born roughly between 1963 and1981) attach more importance to their free time, flexibility and a good “work/life balance” than the Baby Boomers (born approximately 1955-1969), who mainly value pay and status. Generation Y (1980-2000), on the other hand, is very tech-savvy. These “millennials” are the first “digital natives” and have never known a life without the Internet. It is important to them that their jobs fill their lives with meaning and offer variety. They are career-minded and don’t push so hard to combine a career with family life. Generation Z, however, is even more adept at using new technologies. They aren’t just digital natives: they took mobile Internet for granted before they even learned to crawl. Instead of status symbols and material wealth, Generation Z strives towards recognition in both social and professional terms. For the very confident children of Generation Z, a career doesn’t need to give their life meaning: it should be clearly separated from their private lives and adhere to specific rules.

Andreas Lapp: “We need a good mix of generations and people in the company, which is why we want to offer all of our employees attractive job prospects. This is no mean feat, especially in light of the very varied and often contradictory wishes and preconceptions of the various generations.” For example, Lapp pays particular attention when training junior members of staff to sensitise them to the ways in which they can use digital media to best effect at work – and also to point out the risks and legal limitations that exist. That’s why Lapp’s training officers themselves are continuously trained to use new technologies and discuss the different ways in which the members of the respective generations communicate. The goal is to ensure perfectly attuned cooperation, in which young and old alike can learn from one another.

For members of Generation X and the Baby Boomers, the ability to combine family life with a career is often vital. At Lapp, there are many opportunities to make this happen as well. Alongside flexible working hours, these include measures such as shift schedules with a shift exchange option in Logistics. Lapp has programmes aimed at keeping in contact with and reintegrating parents on parental leave, a workshop offering advice on questions relating to caring for loved ones, staff training on searching for care options, courses on health topics and even the provision of a parent/child room for employees at the European headquarters in Stuttgart. In addition, employees can choose from around 40 different part-time work models. In 2016, U.I. Lapp GmbH was awarded first place in the corporate competition Erfolgsfaktor Familie (“Family as a Factor for Success”) in recognition of its HR policy, which is tailored to the various stages of life.

Another important matter for Andreas Lapp is the diversity of the population in the Stuttgart Metropolitan Region, where the Lapp Group has its headquarters. “People living here originate from 180 different countries and speak more than 120 languages. 45 per cent of the population has a migrant background. These different cultural backdrops also bring with them a variety of perspectives, experiences and expectations. However, I’m sure that it will represent a huge opportunity for us if we can integrate these diverse groups and be an attractive employer for them.”

Lapp and the new working environment
The digital world is also increasingly dominating day-to-day work: “Lapp’s new European headquarters are symbolic of change. We are offering entirely new forms of cooperation; with short distances and an open, flexible office environment. This will reinforce communication and cooperation, while our modern IT concept and the overall office environment are intended to inspire and motivate. In turn, this will give innovation a shot in the arm and increase the commitment of our employees,” explains Andreas Lapp. The new working environment also fosters international cooperation. Employees from all over the world work together on specific projects. “This enables us to be as close to our customers as possible and to guarantee them the very best consultation,” says Andreas Lapp.

Many companies find it difficult to draw up a succession plan as early as the Lapp Group has. According to a study carried out by the German development bank KfW, 1.3 million owners of medium-sized German enterprises are already aged 55 or older. A panel of experts on medium-sized enterprises at KfW said the following [1]: “The ageing process places huge challenges in the way of all those involved. After all, it slows both investment and innovation.” The Lapp Group, on the other hand, ushers the younger generation into the management of the company at an early stage and has drawn up a long-term plan for generational change which it is putting into practice one step at a time.

For example, Matthias Lapp, the eldest son of Siegbert Lapp, has already gained experience abroad, including at Coca-Cola in Mexico. After doing so, he worked for seven years in a variety of positions at Lapp. Andreas Lapp’s children are still in training.

Andreas Lapp: “My brother and I also assumed responsibility very early on – when he was 34 and I was 31. At the time, this was a necessity after our father Oskar Lapp sadly passed away in 1987. That was a hard time for us to begin with. Our young successors can now make targeted preparations for assuming responsibility in the company.”

[1] Fokus Volkswirtschaft, Issue 92, dated 23 April 2015: Demografie im Mittelstand – Alterung der Unternehmer ist nicht nur Nachfolgethema (only available in German)

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ISRA announces stock split and higher dividend – Further acquisitions targeted

ISRA VISION AG (ISIN: DE 0005488100), one of the world’s top companies for industrial image processing (machine vision) and a global leader in surface inspection of web materials and 3D machine vision applications, has announced that the Executive Board and the Supervisory Board will be proposing a stock split at the Annual General Meeting on March 28, 2018. Following an capital increase from company funds, each shareholder will receive four more ISRA shares at no charge. For every share held before the split, shareholders will thus own five shares after the split. The share price will be divided by five accordingly. Shareholders’ voting rights or the company’s market capitalization or equity will not be affected.

Furthermore, the Executive Board and the Supervisory Board will continue the sustainable dividend policy of past years and will be proposing a dividend of EUR 0.59 per current share at the Annual General Meeting for the 2016 / 2017 financial year. ISRA is therefore increasing its dividend for the eighth time in a row to allow its shareholders to successively participate directly in the company’s operational development.

The integration of Polymetric GmbH, which was acquired in January 2018, is progressing rapidly. In addition to this technologically motivated takeover, as announced in December 2017, the company is continuing its strategy of further growth through acquisitions in addition to organic business expansion. Several acquisition projects are in progress and some are at an advanced stage. The company is assuming one further deal in the current financial year.

After a good start into the new 2017 / 2018 financial year, ISRA is still gearing its strategic and operational planning towards structural expansion in all areas of the company in preparation for the next big step in revenues beyond EUR 200 million. Management is planning low double-digit revenue growth for the 2017 / 2018 financial year, as in the previous year, with margins at least remaining stable. The company will publish a detailed forecast at the end of February 2018.

 

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Uber’s data privacy breach – the consequences

We are now less than six months away from the implementation of the General Data Protection Regulation (GDPR), which is expected to produce massive changes to be implemented by businesses when handling the data of third parties.

Among the GDPR’s most headline-grabbing provisions are the significantly increased administrative fines. There is also the requirement that the relevant supervisory authority must be advised of personal data breaches by data controllers “without undue delay and, where feasible, not later than 72 hours after having become aware of it” (GDPR article 33 sec. 1).

The Bloomberg news agency recently published the fact that the controversial ride-sharing company Uber was aware of a significant breach of data in 2016 when it is alleged to have paid hackers US $100,000 to delete the personal data it had acquired of some 57 million customers (and self-employed drivers). The information was obtained by the hackers when they penetrated Uber’s cyber-defences, but Uber cannot avoid blame if it failed to take adequate steps to ensure that the data was protected from exposure in the first place. It is a possible indicator of perceived liability that Uber’s chief security officer has now resigned from the company.

The GDPR does not always receive good publicity from businesses on account of the perceived need to deploy significant resources to achieve compliance. However, Uber’s breach underlines the fact that article 33 is needed. The tougher regime on data breaches will be welcomed by the public at large.

Uber’s conduct is understood to be presently under discussion by the EU data protection authorities.

Under current data protection legislation, the relevant supervisory authority should be notified of any significant breach of data . Uber has already been fined for failing to disclose another breach of data that took place in 2014 (the €20,000 penalty for that was derisory). Further action is likely before the GDPR becomes law in connection with the 2016 breach.

When the GDPR is in force, it is likely that the cover-up of a serious breach of data of this nature will incur a heavy administrative fine. The potential maximum could be £10,000,000 or up to 2% of the total worldwide annual turnover of the preceding financial year, whichever is higher (GDPR article 83 sec. 4(a)). Supervisory authorities may want to demonstrate the impact of the GDPR by levying significant fines on prominent organisations such as Uber. If Uber once again exposes itself to a significant breach of data after 24th May, 2018 (the GDPR implementation date), and fails to disclose it quickly enough, it may be fined for both the lack of adequate data security measures as well as for any cover up. It would also have to disclose the breach to any of its customers who are affected. In addition to the other controversies Uber has recently faced, the combined effect of a serious monetary penalty as well as the bad public relations that would follow anyway may have a significant impact on the company’s viability.

Author:
Laurie Heizler, Of Councel, Barlow Robbins LLP, LaurieHeizler@barlowrobbins.com

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asknet AG: strong year-end and a promising start of the eCommerce Solutions Business Unit into the new year

  • High sales performance in the shops processed by asknet at the turn of the year 2017/18
  • Several new customers and new partnership for US sales in the eCommerce Solutions Business Unit
  • Group earnings forecast for 2017 increased

asknet AG, part of the Swiss-listed content marketing, technology and eCommerce services group The Native SA, announces a significantly better performance in its software online shops business segment at the turn of the year 2017/18, than initially forecast.

“Cyber-Monday and Black Friday already indicated a strong year-end performance. However, the Christmas business once again exceeded expectations," commented Jan Schöttelndreier, Vice President eCommerce Solutions. New software releases from several asknet customers contributed to this development.

In addition, the eCommerce Solutions Business Unit was able to win three more new customers from Asia at the turn of the year. Following the successful sales strategy in the APAC region, the company is now also stepping up its efforts to address software manufacturers in North America. A new distribution partnership in the USA, which was also concluded at the end of 2017, will contribute to this development.

Moreover, asknet is adjusting its earnings expectations for the year 2017 upwards (see ad hoc announcement dated January 19, 2018). On the basis of preliminary figures, and contrary to prior forecasts, the Company is now expecting a positive operating result. The main reason for this increase is the decision of the executive board and the supervisory board to start capitalizing software development costs in the fiscal year 2017. The good performance at the end of the year and the numerous new customers acquired in November and December led to additional earnings, thus adding further positive impact. The performance of asknet had also been enhanced with the positive effect from synergies with The Native SA following completion of the change of control transaction in early November.

“In a dynamic market with constantly shorter product cycles, it is of great importance to document the value of our software development efforts. By adapting to this industry standard, we can position ourselves more clearly in relation to other market participants and customers in terms of innovative strength and future viability,“ commented Tobias Kaulfuss, CEO of asknet AG.

Gross profit will initially be weaker than in the previous year due, among other things, to the marked decline in demand for a software release from a major customer over the course of the year.

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