Tieto on the capital markets
IR activities in 2014
The management and IR team actively participated in roadshows and conferences, including Stockholm, London, Oslo, Copenhagen, Vienna, Barcelona and the United States. IR participated in around 100 investor meetings and group presentations during 2014. Tieto also continued the practice to arrange two of the quarterly result announcement conferences for analysts in Stockholm.
Tieto held its Capital Market Day on 27 May 2014 in Helsinki. The event was attended by over 30 analysts and investors. In the frame of the event, the company has provided insights to the changes in IT services market and elaborated on investments in its selected growth offerings. The presentations of the Leadership Team provided updates on the company’s strategy execution and outlook for the Service Lines and Industry Groups. Tieto received very positive feedback on the program and content of the event.
Information about Tieto's IR Policy is available here in PDF format.
Key messages in 2014 include:
- Tieto and our customers are facing revolutionary change as digitalization enables new business models in which IT plays a central role. We are strengthening and renewing our services and competences to ensure a leading position in this development.
- We aim to be at the forefront of efficient delivery of high-quality services. This means pursuing new service models enabled by the ongoing digitalization, including service standardization and automation.
- The shift from traditional to new services is key for growth but also changes our competence structures. As a consequence, we initiated personnel negotiations in early 2015.
- To grow faster than the market in the longer term, we will continue to invest in our high-growth services and new talent. In 2014, we defined the future key offerings, compensating for the decline of traditional IT services. While we shift our focus on growth, profitability also remains high on the agenda.
- We revisited our financial targets during the year. The target of achieving 10% EBIT margin was confirmed while more focus was put on capital structure and balance sheet efficiency. The upper limit for net debt/EBITDA remains at 1.5. We want to maintain our capacity to invest in growth both organically and inorganically. However, the current low level is not regarded as optimal and we aim to achieve ratio of close to 1.
- Dividend policy was updated and our target is to annually increase dividends in absolute terms. In light of the company’s strong cash flow and targeted capital structure, an extra dividend of EUR 0.30 was proposed in addition to ordinary dividend of EUR 1.00 (0.90).
Why invest in Tieto
- By combining our competitive offerings and global delivery we are well positioned to address the changes in the market place.
- We have strong position in our home markets – target to increase share of wallet.
- We continue to improve profitability through more standardized, scalable services.
- Strong balance sheet enables investments in growth, including organic and inorganic, and increase in dividends.
- Growth coupled with improved profitability and healthy cash flow positions us well to increase shareholder returns.