Hansab Group Annual Report 2016 Improving customer experience through innovation
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Hansab Group Annual Report 2016
Table of Contents
About Us....................................................................... 3
A Paradigm Shift...................................................31
Through Innovation to New Heights.......................... 7
Into 8 digits...........................................................35
Financial Results of Hansab Group in 2016 ������������ 9
Growing Stability .................................................39
Aigar Urva Founder and CEO Hansab Group
Consolidated Balance Sheet....................................... 12 Consolidated Income Statement................................. 13 Jaak Õunpuu CFO Hansab Group
Providing Efficiency and Automation...................... 15 Markko Purge Sales Manager Hansab Group
Cracking the Innovation Code.................................. 19 Priit Ivanov Innovation Manager Hansab Group
Delivering Services Better........................................ 23 Algo Puusepp Service and Quality Manager Hansab Group
The Right Fit............................................................... 27 Annika Urva-Ronk HR Manager Hansab Group
Sigita Babarskaitė CMO Hansab Group
Janno Kallikorm Managing Director Hansab AS
Deniss Rubens Sales and Marketing Director Hansab SIA
On the Way to Success........................................43 Darius Žekonis Managing Director Hansab UAB
The Year of Revolutionary Projects....................47 Alar Alumaa Managing Director Ellore
The Year of Expansion.........................................51 Tarmo Koreinik Managing Director Moya
Head Offices and Contacts..................................54
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Members of Hansab Group
Hansab Group Annual Report 2016
About Us HANSAB GROUP OÜ Est. 2005 in Tallinn, Estonia
Aigar Urva
Founder and CEO
Jaak Õunpuu CFO
Markko Purge Sales Manager
HANSAB AS
HANSAB SIA
HANSAB UAB
Tartu, Pärnu, Jõhvi, Kuressaare
Rezekne, Liepaja, Valmiera, Daugavpils
Kaunas, Klaipėda, Šiauliai, Panevėžys and a representative in Belarus.
Est. 1991 Tallinn, Estonia
HANSAB OY
Est. 2014 Helsinki, Finland
Priit Ivanov
Innovation Manager
Algo Puusepp
Service and Quality Manager
Annika Urva-Ronk HR Manager
Est.1993 Riga, Latvia
Est. 1994 Vilnius, Lithuania
MOYA OÜ
Est. 2006 Tallinn, Estonia
CMO
Rūta Urva
Internal Audit Manager
Reigo Rosin IT Manager
Kari Pavelson Accountant
Est. 2007, Tallinn, Estonia
HANSAB KINNISVARA OÜ Est. 2009 Tallinn, Estonia
This year, Hansab celebrates 26 years of business with a record consolidated turnover larger than € 26 million and a team of 314 professionals. Hansab consists of nine companies: Hansab Group OÜ, Hansab AS (Estonia), Hansab SIA (Latvia), Hansab UAB (Lithuania), Hansab OY (Finland), software development company Ellore OÜ, recycling solutions company Moya OÜ and property companies Hansab Kinnisvara OÜ (Estonia) and Hansab Turtas UAB (Lithuania).
Sigita Babarskaitė
ELLORE OÜ
Quality is a watchword for Hansab businesses and the companies aim the highest level, acknowledged consistently with numerous quality management awards. Services and solutions, offered by Hansab, comply with ISO 9001, ISO 14001, ISO 20000 and ISO 27001 standards.
HANSAB TURTAS UAB
Est. 2010 Vilnius, Lithuania
Hansab complete solutions involve consultancy, software development and integration, software and hardware sales, project management and after sales services. Hansab offers a unique solutions and services portfolio. An official channel partner to more than 100 suppliers, the company sells products and solutions from leading manufacturers such as NCR, Ingenico, Qmatic, Bosh, Sony, Samsung, Glory Global solutions and more.
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Brand Timeline
Hansab Group Annual Report 2016
90s
00s
1991
2001
2008
2010
Hansab AS established in Tallinn Estonia
ISO 9001 quality standard acquired
Global economic crisis begins.
Hansab Turtas UAB founded in Vilnius
Employees: 5
2003
2011
1992
1600m2 headquarters constructed in Tallinn
Hansab starts selling security and cash handling equipment to the financial sector
Product portfolio joins POS terminal sales and service
Hansab introduces new strategy with the emphasis on key account management and additionally to finance – focus on public and retail sectors
1993
2005
Establishment of Hansab service department. Product portfolio expands to customer management systems. The first service agreement is signed
Hansab Group OÜ founded to unify and coordinate operations across the Baltics
Hansab SIA founded in Riga, Latvia 1994 Hansab UAB founded in Vilnius, Lithuania 1995 The first financial crisis in the Baltic financial sector 1998 Second financial crisis in the Baltic financial sector after collapse of the Russian economy. Employees: 43 Turnover reaches € 300 000 1999 Sales and service of NCR ATMs begins Period of rapid growth in the company
10s
Shift from product to solution sales. New products in security field – electronic security, EAS and access control
2006
2009
A daughter company Moya OÜ founded to operate reverse vending machines
Hansab TOB Ukraine founded to manage operations in Ukraine.
Turnover rises to € 15 million
Hansab Kinnisvara OÜ founded in Estonia
Employees: 117 2007 Ellore OÜ established by Hansab and Voicecom to develop and integrate software with equipment sold by Hansab (specifically for payment systems) Turnover reaches € 18.5 million euros and net profit of € 1.2 million, resulting in the best financial results in the history of the company Employees: 147 2500m2 Lithuanian headquarters are built in Vilnius
Turnover declines to € 11.3 million Euros Employees: 135
ISO 20 000 certificate acquired Project department founded to manage complex projects and to divide responsibilities between the departments Turnover recovers to pre-crisis level € 17.5 million Employees: 168 Hansab starts service export 2012 Hansab begins active operations in Belarus 2013 Hansab TOB Ukraine sold Turnover 17.4 million euros Employees: 257 2014 Hansab OY founded in Finland Turnover € 20.5 million 2016 311 employees Record turnover € 26.1 million
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Hansab Group Annual Report 2016
Through Innovation to New Heights Aigar Urva Founder and CEO Hansab Group Our 25th anniversary year turned out very successful for Hansab Group. The revenue increased by 23%, reaching € 26 million , doubling the profit € 0.9 million before taxes. The revenues and profits of Hansab Group companies increased and we succeeded to improve our Group’s profitability to 5% of EBITDA. We achieved such positive outcome as a result of the long term investments in innovation and our employees. More specifically, by improving our internal processes, which facilitated increased profitability in sales and services, as well as introducing pioneering solutions to our operational markets. During the last year, we hired a number of qualified employees, especially in the sales and IT fields. Although finding qualified staff is becoming increasingly challenging in our business markets, it helps retain our company’s reputable image and employee and customer satisfaction indexes greater than 4 points on the Likert scale. In 2016, Hansab AS (Estonia) performed the best. The company finished the year with a record revenue of € 10.5 million and profit of half million euros. Hansab UAB (Lithuania) showcased the second highest revenue in Group almost € 10 million . Likewise, Lithuanian Hansab company aggressively cultivated business in Belarus.
Moya OÜ, empties recycling services provider in Estonia, continued active developments in digitalized and location based services as well as investing in opening new recycling spots. These tactics helped close the year with the Group’s second best EBITDA of € 265 thousand . Ellore OÜ, a software development and integration company within the Group, successfully implemented two new projects in the Baltics – the Smart Payment Terminal (mPOS) and contactless payments methods. Together with smaller projects, Ellore finished the year with a turnover of € 960 thousand. Moreover, in 2016 year we worked out and started realising our own 3 Level Innovation Strategy, which also focuses on future developments and trends. Correspondingly, we employed more specialists and invested financial resources in the innovation process. These steps will hopefully support our Group companies’ developments and growth in the coming years. As a final point, we have the intention to continue our growth and to exceed 30 million revenue in 2017. The fulfillment of such ambitious target will be supported by the positive macro-economic climate in our markets and further investments in innovation. Therefore, we have selected innovation to be the key process for the current year for Hansab Group.
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Hansab Group Annual Report 2016
Financial Results of Hansab Group in 2016 Jaak Õunpuu CFO Hansab Group
In 2016, economic growth was modest in Baltics. The Lithuanian economy grew slightly faster compared to its northern neighbours. According to preliminary figures, last year’s economic growth was 1.6%, 2.0%, and 2.3% in Estonia, Latvia, and Lithuania, respectively. At the same time, prices increased by 0.1% in Estonia and Latvia and 0.9% in Lithuania. 2016 financial overview 2016 was a very successful year for the group, as consolidated turnover was the highest ever, reached over € 26 million. The growth was profitable and consolidated profit before taxes was close to € 0.9 million, the second best result is Hansab history. The biggest improvement and the best financial results was achieved by Estonian subsidiary Hansab AS. All group companies outpaced 2015 performances. Compared to 2015, the consolidated revenue of Hansab Group increased by 23% to € 26.1 million. Net profit was up to € 764 thousand from € 354 thousand in 2015.
Growth came from investments by our customers in transport and finance sector, as well as from successful projects in the retail, industry and other sectors. The group showed continuous growth in service revenues, increasing by 5% accounting for 30% of total turnover. The growth of turnover was achieved in all group companies. The largest increase was in Lithuania (including export to Belarus) and in Estonian companies. In Hansab UAB the growth was 37%, in Hansab AS 20%, in Moya OÜ 19%, and in Ellore OÜ 24%. Latvian company Hansab SIA increased sales by 8% and Finnish subsidiary Hansab Oy managed to sell four times more than year before. The largest portion, 39%, of the consolidated turnover in 2016 was generated by Hansab AS, while the share generated from Hansab UAB and Hansab SIA amounted to 37% and 17%, correspondingly, with other group companies accounting for 7%.
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Hansab Group
Hansab Group Annual Report 2016
Service
Sales
25000 AS Hansab UAB Hansab SIA Hansab
In 2016, Hansab AS generated the highest net profit with € 509 thousand, followed by Hansab UAB with € 166 thousand, Ellore OÜ with € 132 thousand, Moya OÜ with € 42 thousand, and Hansab Oy € 0.1 thousand. Hansab SIA produced a small loss of € 36 thousand.
Moya
20000
Ellore
Hansab OY
4%
16%
39% 36%
4%
1%
Hansab Group Revenue by Companies
15000
Investments The largest investments of 2016 included the purchase of reverse vending machines and service stations by Moya OÜ, the purchase of equipment for full-service rentals by Hansab AS, and various software developments. The total amount of investment in 2016 was € 368 thousand. Annual results
10000
5000
The net interest expenses of Hansab Group decreased by 13% to € 44 thousand, while EBITDA increased by 38% to € 1,375 thousand in 2016 (€ 994 thousand in 2015). The consolidated balance sheet volume increased to € 11.4 million (€ 9.4 million in 2015) based on the growth of sales receivables and inventories. Total amount of net fixed assets remained on the same level. Share of equity by the end of 2016 was 39% from the balance sheet. The consolidated return of equity (ROE) was 18%, and the return on assets (ROA) over 7%.
Planning for 2017 and beyond
‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 Consolidated turnover of sales and service in thousands of euros
We believe that Hansab Group’s financial policy, flexible cost base, and development strategies have created a basis for good growth in 2017 and in the future. Economic experts forecast faster growth (2-3%) for the Baltic region in 2017, and the Finnish economy should grow around 1% in the coming years. The inflation will accelerate to 2-3% in Baltics. The main risks are still uncertainty related to global economies which may influence Baltic export markets.
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Hansab Group
Hansab Group Annual Report 2016
Consolidated Balance Sheet
Consolidated Income Statement
in thousands of euros
in thousands of euros
31/12/2016 31/12/15 ASSETS
LIABILITIES AND EQUITY 31/12/2016 31/12/15
2016 2015
321 Cash 246
Loans and borrowings 1 582 1 271
Revenue 26 077 21 174
Current assets 3 739 Trade receivables 2 174 416 Other receivables 304 124 Prepayments 101 2 000 Inventories 1 716 6 600 Total current assets
4 541
Non-current assets 250 Long-term financial investments
285
4 430 Property, plant and equipment
4 428
4 780 Total non-current assets
4 861
Current liabilities Trade and other payables 2 909
1 616
Accrued expenses 423 669
Other operating income 101
55
Tax liabilities 503 836
Business expenses
Non-current liabilities
Operating expenses -2 234 -2 142
Total current liabilities 5 685
4 125
Loans and borrowings 1 266 1 205 Total non-current liabilities 1 205 TOTAL LIABILITIES
6 890
1 266 5 391
100 Intangible assets 148
EQUITY
11 380 TOTAL ASSETS 9 402
Reserves 3 3 Non-controlling interest 146 162
Share capital 3 3
Retained earnings 3 544 3 622 Currency translation differences 2 Net profit for the period 699 TOTAL EQUITY
TOTAL LIABILITIES AND EQUITY
4 490
11 380
2
314
4 011
9 402
Goods, materials, services -16 637 -12 792
Labour expenses -5 884 -5 227 Depreciation -470 -525 Other expenses -48 -74 Operating profit 905
469
Profit before income tax 861
418
Net profit for the financial year 764
354
Finance costs -44 -51 Income tax -98 -64 Equity holders of the parent company 699
314
Non-controlling interest 64 40
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Hansab Group Annual Report 2016
Providing Efficiency and Automation Markko Purge Sales Manager Hansab Group
The year 2016 showed very strong sales performance in Hansab Group companies. We increased our sales turnover and customer base by more than 20%. Biggest growth came from automation and security solutions sales by growing more than 30% compared to 2015. The key customer segment is still banking and finance, giving 39% of the sales revenue. All the other segments continued to grow as well. Focusing on our strategic customers helps us to find new businesses and keep up with the developments. Biggest Increase in Transportation and Logistics Sector Transportation and logistics sector is in continuous development – our customers see great potential for growth and an increase in the demand for reliable automation solutions what Hansab offers. In general, the sales in the transportation sector grew twice in comparison to 2015. We have had a change to contribute to great infrastructure projects like harbours, airports and for border controls across our countries. Harbours and airports continue to invest in automated passenger boarding solutions.
In the end of the last year, DPD Baltics decided to supplement its alternative delivery solutions with automated parcel terminals from our partner KEBA. With DPD, yet another customer in the Baltics now relies on KePol automated parcel terminals for offering customers a secure and convenient alternative delivery channel in the growing e-commerce market. The DPD automated parcel terminals solution was awarded as a Best Sales Project in Hansab Group in 2016. Investing in the Future Bigger and complicated projects need to be handled more efficiently. We continue to invest in better project management processes and in-house software development becomes more essential. Together with our software company Ellore and with our partnerships with the biggest software companies of the market, we are ready for each challenge.
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Hansab Group
Hansab Group Annual Report 2016
Finance and Payment Automation Electronic security Physical security Money handling
Consumables
15000
Card products
14%
5%
20%
51%
5%
3% 2%
Distribution of Revenue by Product Groups
Strategic Customers are in Focus We believe that the most important aspect of working with customer satisfaction is developing the trust and understanding the needs of the customer. We are pleased to report that customer survey feedback has been once again very positive across all group companies. Our customer satisfaction index in total was 4.1 on a 5-point scale. Thanks to developing the competences of our sales and field managers, we can assure even better customer services.
10000
5000
Outlook for 2017
‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 Sales Turnover
in thousands of euros
Our focus remains on bringing innovative and efficiency providing solutions to our customers. We believe that, for example in retail sector, there will be significant shifts in the way customers want to shop. Banking and finance sector continued to upgrade their self-service network and implementing contactless payment to markets. In automation, we can see even faster development for robotics than we had expected. Hansab is glad to help to develop better customer solutions in all our strategic sectors.
Banking and Finance Retail Transport
9%
State and Public
Industry
Resellers
Hotels & Recreation
2% 2%
Distribution of Revenue by Strategic Segments
7%
22% 19%
39%
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Hansab Group Annual Report 2016
Cracking the Innovation Code Priit Ivanov Innovation Manager Hansab Group
Innovation has been driving us for years and I am glad to say that 2016 has been one of the most successful and innovative years for Hansab Group. In most of the projects, we have created something unique together with our customers and partners which has enabled us to bring direct innovation to the general public. We are constantly moving further from being a goods handling company to a technology expert offering full scale solutions. In 2016, Hansab started focusing more on innovation as a key part of our strategy. We have implemented a 3 Level Innovation Strategy which allows us to mediate innovation effectively – we constantly monitor our partners, we develop products and services based on the needs and market trends and we hold internal workshops to understand where our strategic sectors are heading in the future. The initial focus has been set on the transport and retail sectors.
We have successfully completed a list of unique projects that have helped us change the way people are used to do something. These solutions are innovation in its best. Mediating Customer
Innovation
Together
With
the
We launched a state-of-the-art access control system in Estonian small ports Virtsu, Kuivastu, Heltermaa and RohukĂźla where access to the ship is granted through an automated check-in solution using registration number plate as the main identification method. The two ferry lines between mainland and the islands are used by over 2 million passengers yearly and previously the check-in process was semi-automatic requiring additional tasks by the passengers. Now the passengers can enjoy a full automation of our access control and traffic guidance system. This allows the ferry operators to speed up the check-in process thus generating additional value. It is the first time in our region that number plate based automation has been applied in such concept and scale.
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Hansab Group
Changing the Card Payment Market In 2016 we changed the Baltic card payment market by introducing the new mPOS card payment terminal together with Swedbank. The Smart Terminal connects with mobile phone or a tablet and all you need is cellular internet connection. That makes the terminal very mobile and it is perfect for using in a taxi, on a fair or in door-to-door sales. The solution is suitable for small companies which do not have a large amount of card payments every day. mPOS allows small merchants to accept card payment everywhere with cost efficient smart terminal. Hansab’s Role in the Future of Technology Upcoming years will be interesting – technology and automation will be playing an even greater role in our everyday lives and phenomena such as robotics and Artificial Intelligence I will shift the way we think and act today. Hansab will focus more on automation of personal processes to make our everyday life more efficient, timesaving and environmental friendly. We will be moving the boundaries in retail, transportation, healthcare and banking sectors and be in a constant search for opportunities leading us to improved results.
Day in a Life of the Innovation Manager. Chatting with Pepper.
Hansab Group Annual Report 2016
Delivering Services Better Algo Puusepp Service and Quality Manager Hansab Group
Total service revenue in 2016 was â‚Ź 7.9 million, while turnover grew 5% comparing to 2015. In 2016, Hansab Group companies solved more than 75Â thousand service orders, resulting 8% more than the previous year. As off today, as many as 50% of Hansab Group employees work in the service department. We are continuously focusing on increasing the quality and efficiency of the services by using innovative tools. The technologies we offer are becoming more and more information technology based thus requiring clear-cut IT competences. Last year was mostly about the implementation of the services to offer more monitoring and remote services for the customers.
2012
54 263
2013
68 522
2014
67 600
2015
69 678
2016
75 197
Number of Service Orders
Hansab services department launched an advanced monitoring solution for handling information the devices are sending directly to our service desk. When using remote access then it is possible to solve incidents without engineer’s visit. Thanks to monitoring and remote access we can offer very quick and cost effective resolution process and help the customers to increase efficiency. This is the trend for future and we will continue augmentation of the remote solution services. Progressions in the Services Department One of the biggest improvements was related to the engineer competencies and access to Hansab created a new management system for technical documents and software, where the engineers can quickly find necessary information about specific client cases. In addition, we created a database for certificates, to provide an overview of trainings and seminars Hansab employees participated in.
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Hansab Group
The new system has increased our service quality. Now, engineers can solve incidents faster while the registered problems related to incidents have decreased by 20%. In the end of 2016 we, together with Ellore, started implementation of an e-document solution called eDoc for the service engineers. The tool enables Hansab engineers to sign documents with customers electronically, bypassing the need for paper. All service engineers use tablet PCs to access all necessary information from our network and including technical materials and testing software to finish on-site works quickly and professionally. Information security and clean nature is of high importance both for us and our customers. Therefore, we decided to additionally certify our management system with ISO 27001 and ISO 14001 standards. Hansab Group companies have ISO 9001, ISO 14001, ISO 27001 and ISO 20000 certified management systems. The ISO certificates have been supporting our IT-related developments because it assures data security. New Solutions Coming In 2017 In 2017, we plan to instill more options for the eDoc and tablet solution. The keyword will still be remote management. Therefore, we will continue working on solving incidents even faster and more efficiently. Finally, we will follow up with the redesigned customer portal enriched with advanced functions.
“Now, engineers can solve incidents faster while the registered problems related to incidents have decreased by 20%.” - Algo Puusepp
8000 7000 6000 5000 4000 3000 2000 1000
‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 Service Turnover
in thousands of euros
Hansab Group Annual Report 2016
The Right Fit
Service 50%
314 employees
Annika Urva-Ronk HR Manager Hansab Group
At the end of 2016, the Group had 314 employees on board. The number of employees at AS Hansab, SIA Hansab and UAB Hansab fell in the same range as the year before. Increased workloads were mostly covered through making processes more effective, keeping the number of people stable. The number of employees at Ellore OÜ increased in 2016 in connection with an increase in the volume of developments and transferring the Group’s IT support to Ellore. On the other hand, the number of workforce somewhat decreased at Moya OÜ. Hansab Group has planned to increase the number of personnel in 2017, mostly in sales departments and project departments of companies in connection with the addition of new solutions and a continued increase of workloads. The key activities carried out during the previous year for increasing efficiency included combining customer service and support services to the service department, transferring logistics and warehousing for the financial department, forming field-based teams and introducing the role of a field manager in sales departments, and transferring intra-group IT support services to Ellore.
Sales and Project Department 39%
Administration 11%
Employees by activity field Moya
Hansab Estonia
Hansab Lithuania
Hansab Latvia In connection with a low unemployment rate in our Hansab Group operational area in general and scarcity of qualified Ellore labour in the IT and technology area, we have madeHansab it oneTurtas of our priorities to find new employees Hansab Finland through scholarship and internship programs in institutions of vocational and higher education. In 2016, we awarded scholarships in four schools: in Employees by company 314 Estonia, in the Estonian InformationTotal Technology College and the Tallinn Polytechnic School and in Latvia, in Riga Technical University and Riga Technical College.
During the year, 25 students from different schools received internships. Interns mostly majored in IT, but also in automation, construction and telecommunications. The average period of internship was six months. Persons who completed the internship successfully could continue working in Hansab Group companies.
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employees 30
Hansab Group Administration 11%
Employees by activity field Moya
Hansab Estonia
There are also several ongoing cooperation projects. AS Hansab is participating as a consultant in the development of a new Electronic Security Systems program at the Tallinn Polytechnic School. UAB Hansab is participating in the cooperation project of Vilnius Colleague and Instituto Poltecnico Do Porto for preparing students for the labour market. Ellore is involving students in several interesting development projects, the students could use for their thesis.
Hansab Lithuania Hansab Latvia
Hansab Group
Ellore
Hansab Turtas
Hansab Finland
Employees by company
Total 314
Changes in the Employee Motivation System In addition to recruiting new employees, it is also very important to keep the existing people. We consider organizational culture, values and principles that we follow in our everyday activities and management to be one of our strengths. In order to assess the effectiveness of Hansab Group and gather suggestions from the managements, we organized a broad survey in autumn concerning the motivation system. The survey and subsequent discussions in different workgroups resulted in several improvements to our existing motivation system. We will continue to share the company’s profit with all our employees every quarter. So far, this principle has received a lot of positive feedback. As a result of the survey, we supplemented the bonus system of the sales department and added options to the motivation system for rewarding employees for their various extraordinary achievements. We also
added several additional holidays both in case of family events and to all employees who have been working at the company for longer than 5 years. Grants for family events will continue to apply in our motivation system. We consider it important to value the events taking place in the personal lives of our employees and the time that the employees spend with their families and people close to them. For the 16th time already, we carried out an employee satisfaction survey in the entire Group. This year, 88% of all employees of the Group participated in the survey. On a five-point scale, the Group’s average result was 4.1 points, which had also been set as a goal. AS Hansab (4.0), UAB Hansab (4.2), Ellore OÜ (4.6) and Moya OÜ (4.6) got an average score above 4.0. The result of SIA Hansab fell a little short of the target (3.8). The employees of the entire Group gave the highest average scores to their cooperation within the department, they believed that their work is important in achieving the objectives of the company, felt proud of the company and were happy that they are part of Hansab.
“In connection with a low unemployment rate in our operational area in general and scarcity of qualified labour in the IT and technology area, we have made it one of our priorities to find new employees through scholarship and internship programs.” - Annika Urva
Hansab Group Annual Report 2016
A Paradigm Shift Sigita BabarskaitÄ— CMO Hansab Group
Hansab Group has continued implementing strategic marketing targets, which consisted of centralised marketing coordination, improvement of visual communication and focus on digital platforms to better deliver information for the stakeholders. In short, 2016 has been a year of instilling innovation and digitalisation in all Hansab marketing processes. A Breakthrough in E-commerce Website development continued to take place since 2015. We have launch three new websites – a corporate Russian language site, a Belarussian site as well as Finnish language website. Now, we believe that all of our markets have an underlying presence established. However, the biggest breakthrough took place with e-commerce in our main websites. Together with our long-term customer Swedbank, we implemented an umbrella payment platform, called SPP. The platform has enabled our customers to pay equally by bank links and credit cards. With the launch of the e-commerce, online sales revenues tripled.
Targeted Marketing Communications Annual customer satisfaction survey results prove our customers to be well aware of the market trends and solutions. As many as 70% requested to receive more information about the sector based solutions, new products and implemented projects. Hence, our Lithuanian, Latvian and Estonian Hansab companies began active segmented e-mail marketing campaigns. The results are astonishing - 68 successfully executed campaigns, with average open rate of 35%. Corporate Social Responsibility As part of the NCR, leader in omni-channel solutions, Premier partner status, we have been nominated as the NCR brand ambassador for the Baltics. Encouraged by the nomination, we hosted a charity event for an orphanage in Estonia. The whole day event involving a number of recreational activities not only brought motivation and joy for the youth, it has also allowed us to speak and bring media awareness about these issues in Estonia.
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Hansab Group
Hansab Group Annual Report 2016
An Eventful Year
“2016 was the year of instilling innovation and digitalisation in all Hansab marketing processes.” - Sigita Babarskaite
Hansab Group has set the goals to organise professional, value providing events. In total, Hansab companies organised 25 customerevents including seminars, road shows, VIP events and more. Together with Swedbank, Ingenico, Mastercard and Confent, we hosted an annual payment forum EXEX in Tallinn. With key retailers in the field, we aimed at bringing the latest trends in the payment field. Unification of Hansab Brand Improving and unifying Hansab corporate brand is a target that extends further than just during one year. In 2016, we took steps forward to organise all Hansab sticker collection, enabling our departments to better brand our solutions. This way, we want to show general publics that we are behind the solutions. Digitalisation of Marketing Platforms We continued our work on better customer experience. We have switched to a new platform, called Surveygizmo. The online survey platform has enabled us to more efficiently measure projects, events and customer satisfaction. It allows for fast dispatch and automated collection of data. This way we ensure that our customers are always heard, regardless of time or location constraints.
Supporting Other Hansab Group Companies During the previous year, we finalised Ellore’s corporate visual identity (CVI) and the company’s website was updated according to the new guidelines. Additionally, Moya’s CVI was renewed after several years in order to upgrade the look and make it more usable. The first half of the new year will bring implementing a new interior design concept for Moya spots to go together with the renewed visual brand identity and the vision of the company. Future Growth Plans In 2017, we will continue to implement marketing automation in all Hansab companies, followed by a facelift for Hansab logo. These changes, together clearly defined marketing targets, should bring results in the coming years.
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Hansab Group Annual Report 2016
Into 8 digits Janno Kallikorm Managing Director Hansab AS Member of the Board We are proud for the fact that for the first time a Hansab company has achieved a revenue of more than €10 million after fulfilling most of its goals set for 2016. The solutions contributing most to the success were automation, payment and electronic security, growing by 68%, 21% and 8% year on year respectively and making up 85% of the total sales revenue. We are especially glad about the success in transport sector where we saw our revenues increase 8 times and retail sector with a notable growth of 32%. Services revenue continued to show a modest growth of slightly more than 2% with income from service level agreements contributing most and growing by 5% compared to 2015. The total revenue of Hansab AS reached €10.5 million, 20 % higher than in 2015. Profit before taxes is calculated at €546 thousand, marking a significant improvement in profitability compared to previous years.
Feedback from stakeholders continued to show positive results, as we were rated highly, 4.0 and 4.0 (on a 5-point scale), respectively, in our employee and customer satisfaction surveys. Automation Through Innovation Whether it is handling cash, delivering parcels, selling tickets or accessing secure areas, our technologies are here to help our customers to be more efficient in their daily activities. 2016 saw a number of our valued customers continuously investing into innovative technological solutions to automate their business’ processes with most notable progress taking place in transport and financial sectors. Together with Nortal, Hansab AS developed and equipped all passenger ports operated by TS Laevad with automated ticketing, vehicle measuring and guidance systems, digital signage, etc. A similar project was also started in Port of Tallinn Terminal A which will be concluded in 2017.
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Hansab Estonia
The Baltic market also gained a new player in automated parcel delivery with DPD installing its first 45 parcel kiosks, 20 of which were placed in various locations in Estonia. Hansab together with KEBA provided both the hardware and the software for this notable project. In the financial sector, we saw continued investments into self-service equipment and smart payment solutions. In order to help small merchants to go mobile and be more flexible in acquiring payments, Hansab AS together with Swedbank, one of the Baltic region’s leading banks, introduced a “Smart terminal” solution which was accepted by the market extremely well. By now more than 1000 terminals have been deployed in Estonia. Hansab Oy Out of the Starting Blocks In our third year of operations in Finland, Hansab Oy was able to turn the loss of 2015 into a small profit in 2016. At the end of 2016, we strengthened our organization by contracting a new country manager with extensive knowledge of the Finnish retail and hospitality market. We focused on marketing activities and on establishing a solid customer base. The hopes are high to achieve a minor breakthrough in 2017.
Job Well Done Will Be Acknowledged In April, Estonian Security Association together with its partners nominated Saarte Liinid AS and Hansab AS for the “Best Security Solution of 2015”. Hansab created and deployed an automated video surveillance and analytics solution in Saarte Liinid small ports with tailor-made Ellore software and state of the art Bosch hardware. All the above helps the customer and their customers to improve harbor management and logistics processes. The newly acquired information security certificate ISO 27001 will ensure that all customer data will be kept secure at all times. Looking Ahead The priority for the upcoming period will be innovation to furthermore integrate new technologies into our daily lives. We are readying ourselves to take the first steps in robotics and AI fields, where we hope to share first news with our customers very soon!
“Whether it is handling cash, delivering parcels, selling tickets or accessing secure areas, our technologies are here to help our customers to be more efficient in their daily activities.” - Janno Kallikorm
Hansab Group Annual Report 2016
Growing Stability Deniss Rubens Sales and Marketing Director Hansab SIA Member of the Board
Increased stability and innovative solutions these are the defining phrases of 2016 in Hansab Latvia. As we made solid foundations in 2015, we were able to improve our operational stability and achieve considerable revenue growth during the last year. It comes as a result of decreased changes in personnel and improved competence in all departments. Therefore, our revenue increased by 8% reaching € 4.5 million compared to € 4.1 million in 2015. Solid Financial Sector Results As each year, the strongest sales in 2016 were in the financial sector – 65% from total company revenue. The results were based on the ATM and POS deals with Swedbank and newly signed POS agreement with Nets.
Additionally, one of the biggest Hansab innovations took place in the banking sector – joint Swedbank and Ellore mobile POS solution – Smart Terminal or the mPOS. This innovative solution is still one of the kind in the Latvian market and gaining more and more popularity among small business customers. Not only have we sold more than 550 units of mPOS terminals, but the solution also received the award “Platinum Mouse” as the Best Solution for Business from the Latvian Information and Communications Technology Association. Emerging Transportation Sector and Growing Retail 2016 has brought a notable change in sales to strategic customer sectors. For the third year in a row, retail customer sector has grown by double digits - 16% compared to 2016. It was backed up by improved sales competence in electronic security solutions and increased customer trust in our services.
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Hansab Latvia
Hansab Group Annual Report 2016
“As we made solid foundations in 2015, we were able to improve our operational stability and achieve considerable revenue growth during the last year.� - Deniss Rubens
Another notable revenue leap was in the transport sector. This was mainly possible thanks to two deals. KABA one-way passenger corridors installation in the new terminal of Riga Airport and 10 KEBA Parcel machines for the parcel delivery company DPD. These and other deals summarized in achieving significant 115% growth in the transport sector. Digital Signage and Marketing Activities
Future Vision
One of the biggest success stories in the product segments was the digital signage solution sales. It was greatly backed up by our great deal improved marketing activities. Focused customer events and integrated digital marketing activities have both broadly amplified Hansab image as a professional digital signage solutions provider.
Improved competence and continuous focus for providing innovative solutions is our base for the growth in 2017. Our yearly growth of security solutions’ sales and increasing market demand for self-service solutions allow us to expect a considerable increase in revenue in the retail segment. Based on that and historically strong sales in financial sector, emerging demand from transport sector for self-service and automation solutions and significant market growth for digital signage solutions we plan to achieve a massive 35% revenue growth in 2017.
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Hansab Group Annual Report 2016
On the Way to Success Darius Žekonis Managing Director Hansab UAB After modest results in 2015, this year company’s revenue grew 37%. Hansab Lithuania managed to achieve an all-time revenue record - € 9.9 million . The profit before taxes grew to € 200 thousand and it is 70% higher than in 2015. Additionally, the company accounted the best sales revenue in the history in the Belarusian market. The huge revenue growth in 2016 was influenced by the sales growth in almost all business segments. The transport sector became number one by reaching 29% of total sales turnover. The service revenue stayed at about the same level as in 2015. Although service export revenue decreased, it was compensated by an all-time record revenue from installations. The installation revenue grew 5 years in a row and reached € 613 thousand in 2016. The shrinkage of SLA’s in banking sector was successfully compensated by other sectors and the total SLA sales remained at about the same level. The positive feedback from the customer (4.2 on a 5-point scale) and employee (4.2 on a 5-point scale) surveys show that the company is on the right way to the success.
Innovation Is the Key The growth of e-commerce market was the key driver for logistics companies to make the investments. Quick and reliable delivery is not enough for e-shoppers anymore, they want to manage their time themselves and receive delivery at the time most convenient to them. Lithuanian company created an innovative project of parcel delivery terminals for Baltic Post five years ago and the network of terminals grew in 2016 reaching more than 100 terminals. In 2016 DPD, the leader of the market of delivery in the Baltic States, made a decision to add delivery terminals to the current network of DPD Pickup terminals to satisfy the needs of the e-commerce
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Hansab Group Annual Report 2016
market. Hansab Lithuania helped to implement parcel terminals project across all Baltic countries. The clients are provided with an option to not only quickly and comfortably pick the goods purchased in online stores, but also send deliveries to any address in Europe.
“The huge revenue growth in 2016 was influenced by the sales growth in almost all business segments.” - Darius Zekonis
The customer experience was the key element developing the new Kaunas bus station. Hansab Lithuania helped to implement the most innovative technology solutions for this new bus station by making self-service bus ticket kiosks, installing information boards and digital signage screens in order to provide online information about bus arrival, boarding and leaving time. In the retail sector, the company held the leading position in providing digital signage solutions with innovative content management. For example, MEGA shopping mall expanded in 2016 and selected Hansab to be their partner for the digital signage and way-finding solutions. Accomplishments in Belarus Hansab Belarus continued focusing on two main segments – banking and retail. 2016 was the currency denomination year in Belarus. During the denomination, Belarus introduced the coins for the first time in country’s history. Consistent work with the network of partners and end-customers in Belarus gave a fantastic result for us. Hansab gained 75% of market share in coin sorters sales in Belarus and the total sales turnover was € 795 thousand.
Changes for Success Hansab UAB continues to grow, counting 71 employees at the end of 2016. In order to increase the efficiency of services delivery to the customers, the technical support and customer service departments merged in the middle of the last year. Finally, we decided to start cooperation with the National Innovation and Business Center, which brings together science and business activities. The center suggests us to give to students fresh ideas to create interesting and new products for businesses.
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Hansab Group Annual Report 2016
The Year of Revolutionary Projects Alar Alumaa Managing Director Ellore Member of the Board Ellore follows its mission to create integrated solutions and provide added value to Hansab products and services. We develop and sell integrated software solutions and offer support and consultation services. The major share of our activities is connected with card payment services and terminal software distribution. Ellore’s sales revenue was € 960 thousand growing by 25% compared to 2015. The profit before taxes nearly doubled, reaching € 157 thousand. The main reason for the higher profit was the change in the revenue structure, increase of the IT-support, consultation and in-house software developments’ proportion. Payment Software Developments Services related to card payment solutions have significant role in Ellore’s share of activities. During 2016, the number of terminals serviced by Hansab companies grew to over 30 000 items, which increased the need for technical expertise, pre and aftersales consultation over the Baltic countries.
The contactless card payment upgrade was the biggest service project last year, influencing all our partners. Project included the change of terminals’ software, consultation of integrators and other software services. Ellore also launched the card payment terminals project in Belarus, by introducing the unattended card payment terminals for two different parking solutions and software delivery for ECR integrated attended card terminals. Together with Swedbank and Voicecom, we implemented a unique payment solution in the Baltics – mPOS also known as Smart Terminal. Ellore developed the iOS and Android applications for Swedbank. The applications are built according to client’s needs and requirements and are integrated to Swedbank’s i-Banking application.
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Hansab Group Annual Report 2016
The solution, dedicated to small merchants, became so popular that over 2000 new merchants were equipped with this card acceptance system during the first 6 months. We have partnered up with 10 new companies during the year, which integrated PosXML with the electronic cash register system or the kiosk solutions. Logistic company DPD selected us to equip their Baltic countries outdoor parcel kiosks with unattended terminals and provide consultation services for the integration works. Software Integrations Ellore developed customized worktime data software for Havas Latvia, which enabled worktime planning, accounting and salary calculation to be done automatically and in accordance with the actual data from their access system. At the end of the year we finalized the development of eDoc solution for Hansab companies. The software enables Hansab engineers to sign documents with customers electronically. Ellore extended its services by taking over the Hansab Group IT infrastructure management and IT services. We service corporate IT system including business applications, more than 100 servers and overall IT infrastructure on a daily basis. Social Projects Ellore continued the co-operation with Estonian IT College to support students with two stipendiums annually. In addition, we provide academic internships to expand the students’ practical knowhow and help to start their carrier.
Quality and Future Goals Last year we preserved high customer (4.1) and employee (4.6) satisfaction indexes in 5 point scale system. Ellore’s management and service processes have been officially certified according ISO9001, ISO 20000, ISO 27001 and ISO14001 standards. This raises the company to the next level but also sets higher expectations. Following other Hansab Group companies, Ellore continuously invests in quality management to support its business organic and extensive development. Being part of Hansab Group, Ellore supports corporate customer growth efforts by developing and providing modern, high quality added value solutions.
“During 2016, the number of terminals serviced by Hansab companies grew to over 30 000 items, which increased the need for technical expertise, pre and aftersales consultation over the Baltic countries.” - Alar Alumaa
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Hansab Group Annual Report 2016
The Year of Expansion Tarmo Koreinik Managing Director Moya Member of the Board
Moya’s turnover grew 19% in 2016 reaching €1.2 million . The growth was aggressive - we opened 15 new empty collection points all over Estonia. During the last year, we managed to return more than 32 500 000 packages to the recycling system. The company is now offering new technical solutions, in turn increasing customer base. We expanded our activities to south and centre Estonia, where Moya either had not previously operated. The rapid development was possible thanks to our partner Rimi Food Estonia, offering new cooperation opportunities to manage recycling venues.
One of the most worth mentioning projects last year was the empty collection station in the new shopping centre Mustamäe Keskus in Tallinn. It was unique due to the small building’s technological solution and modern service area. With this station, we could show our end-users that returning bottles can be convenient and easy. In addition, because the site can easily be reached by car, we even encourage our HoReCa customers to return their bottles there. Systematically Improved Services In Spring 2016, Moya acquired ISO 9001, ISO 14001 and ISO 27001 certificates from Bureau Veritas for quality management, environmental management and information security. For us, these certificates confirm that in addition to modern company culture, our processes are systematically organized.
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Ellore
“We began improving our service strategy, for which the goal was to decrease time and labor resources in all service levels” - Tarmo Koreinik
Hansab Group Annual Report 2016
In addition, we began improving our services strategy, in order to decrease time and labour resources in all service levels. This year, we continue the decrease the ratio of employee per empties’ stations. To make return of the packages easier and increase points, we carry on the progression of the equipment in 2017. We also continued developing the new information system MOMO with Ellore, which allows to monitor service processes and the equipment 24/7. Moya signed a sponsorship agreement with a talented Estonian discus thrower Priidu Niit at the end of 2016. Priidy Niit, who also works as the Moya IT development manager, is strongly committed to achieve both sports, as well as professional goals. To improve corporate visual identity, we have finished the new Moya brand book. The new look brings freshness and vicissitude to the company. In addition to renewing the CVI, we are working on the new interior and exterior concept for Moya. In 2017, we mainly focus on evolving the existing processes in the company, modernizing our empty return locations, implementing innovative technology solutions and introducing our services to new retailers.
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Map and Contacts
Hansab Group Annual Report 2015
FINLAND St.Petersburg
Helsinki
Head Offices and Contacts ESTONIA
LATVIA
Hansab Group OÜ
Hansab SIA
+372 6059800
+371 67325550
Keevise 11, Tallinn, 11415 group@hansab.com Hansab AS
Jõhvi
SWEDEN
Tallinn
Kärdla
Stockholm
Other offices: Daugavpils, Rezekne, Valmiera, Liepaja
Kuressaare
Baltic Sea
RUSSIA
Tartu
Pärnu
Piedrujas iela 7, LV-1073, Riga hansab@hansab.lv
ESTONIA
Valmiera
Keevise 11, Tallinn, 11415 +372 6059800
LITHUANIA
Other offices: Tartu, Pärnu, Jõhvi, Kuressaare, Kärdla
Hansab UAB
Moya OÜ
info@hansab.lt
hansab@hansab.ee
Keevise 11, Tallinn, 11415 +372 6836440
LATVIA Riga
Savanorių av. 180A, LT-03154, Vilnius +370 5 205 8800
Liepāja
Other offices: Kaunas, Klaipėda, Šiauliai, Panevėžys
info@moya.ee
Klaipėda
Ellore OÜ
Šiauliai
+372 6059813
info@ellore.ee
Kaliningrad
Gdansk
POLAND
Daugavpils
Panevėžys
LITHUANIA Kaunas
Keevise 11, Tallinn, 11415
Rēzekne
Vilnius
BELARUS Minsk
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Notes
Our vision is to be the leading partner in innovative technology solutions.
Design: Greta Babarskaite Photography: Stina Kase MUA: Triin Kärsna
Our mission is to help you become secure and efficient.