Markets and Digia's Business Operations

Board of Directors' report

Markets and Digia's Business Operations

Domestic segment

Demand remained strong for integration and analytics services during the financial year. Digia's business outperformed general IT market growth, and profitability remained on a healthy level. Investments to enhance delivery and service capacity continued, and are expected to bolster net sales development in 2016. Meanwhile, continued major investments in the development of product and business models for site optimisation taxed the segment's overall profitability during the financial period.

On the whole, the ERP and MES business showed moderate development during the year, despite the seasonal fluctuations which are typical in this business area. The Microsoft technology based business grew briskly, with excellent profitability. Quarterly fluctuation was particularly strong in the ERP business based on Microsoft technologies. Significant new delivery and application management service agreements were signed in this business area, which contributed to a slight increase in net sales in the financial year and which will provide a firm foundation for 2016. Seasonal fluctuation was also notable in the ERP business based on Digia's own software. Net sales, which had been declining in the third quarter, took an upward turn in the final quarter, resulting in slight overall growth for the full year.

The business segment based on financial-sector software solutions showed growth throughout the review period. The segment will continue to invest in recruitment, and operations in Finland are forecast to grow faster than the general IT markets in 2016.

In the service business, demand and profitability showed a highly positive performance trend during the year, with the final quarter showing particularly strong net sales growth.

Qt segment

Qt business showed very strong growth throughout the period. Operating profit also improved on the back of net sales growth, and operations were in the black.

During the review period, the new Qt 5.5 version was launched. The website launched for the Qt segment has been well received. This website plays an extremely important role in managing the Qt ecosystem, and Digia will continue to make substantial developments in this channel. The Qt World Summit held in Berlin in October was an event where the global Qt community gathered to present and discuss current Qt technology issues. The event was a huge success. It attracted more than 1,000 visitors from all over the world: customers, partners, and members of the Qt developer community.

During the review period, a new office was opened in South Korea, and sales resources were strengthened, especially in Asia. Business development efforts were particularly focused on consumer electronics and automotive segments.