Total Specific Solutions B.V. Binnenweg 1a 1261 EK Blaricum The Netherlands T +31 (0)35 538 84 29 F +31 (0)35 538 43 98 www.totalspecificsolutions.com
Strategic alignment in ICT Annual Report 2007
Financial Highlights (All amounts in EUR 1,000 unless otherwise stated)
2007
Selected Profit & Loss Data Net Sales
54,565
EBITAE*
9,439
Result before Taxation
1,289
Result after Taxation
745
Selected Cash Flow Data Cash Flow from Operating Activities
14,395
Cash Flow from Investing Activities
(43,486)
Cash Flow from Financing Activities
26,594
Selected Balance Sheet Data Total Assets Group Equity Tangible Fixed Assets Intangible Fixed Assets
45,756 8,511 728 32,855
Various Number of employees (fte) ultimo
556
Notes * The ‘E’ in EBITDAE stands for “Exceptional”.These exceptional costs represent non-recurring expenses related to acquisitions or restructurings. Group companies may book such costs as exceptional only in the first year. After the first year no exceptional expenses are allowed and included.
As a group, you have a broader reach than an individual. Working together to set the right course. Setting and achieving goals. Offering solutions with added value. Formulating the right answers to specific questions and really delivering on the promises you make. Working together ‌ doing business together!
Annual Report 2007 Total Specific Solutions
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Annual Report 2007 Total Specific Solutions
Contents Total Specific Solutions Company Overview
4
Specific Solutions
8
Directors’ Report
12
Financial Statements Consolidation Policies
16
Consolidated Balance Sheet
20
Consolidated Profit and Loss Account
22
Consolidated Cash Flow Statement
23
Notes to the Consolidated Balance Sheet
24
Notes to the Consolidated Profit and Loss Account
26
Company Balance Sheet
27
Company Profit and Loss Account
28
Notes to the Company Balance Sheet
29
Notes to the Company Profit and Loss Account
30
Auditor’s Report
31
Other Information
32
Other Introduction to the Reconciliated Profit and Loss Accounts
33
Consolidated Balance Sheet – Calendar Year
34
Consolidated Profit and Loss Account – Calendar Year
36
Reconciliated Profit and Loss Accounts
37
Notes to the Reconciliated Profit and Loss Accounts
38
Group Companies
Total Specific Solutions
Annual Report 2007 Total Specific Solutions
Company Overview Total Specific Solutions is the ICT company focussing on the delivery of specific ICT solutions. The company operates in the areas of ICT consultancy, services and software, serving its international customer base from offices in the Netherlands, Belgium and Romania. Currently, Total Specific Solutions and its subsidiaries have more than 600 employees.
Client Focus Following the mechanisation of information in the 1960s and 1970s, the digitalisation of the 1980s and the breakthrough of the information society in the 1990s, the ICT market has changed from a supÂplydriven one to being demand driven. Companies can nowadays only benefit from ICT by investing in solutions which contribute directly to the achievement of their business objectives. These solutions need to be perfectly attuned to the company’s needs and to the continuously, ever faster-changing markets and -conditions. Companies look for those specific solutions and expertise which are best-inclass and which add value to their organisation.
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Annual Report 2007 Total Specific Solutions
Total Specific Solutions serves many of the well-known companies which have an impact on our daily lives.
Total Specific Solutions offers these solutions and the underlying expertise to large and medium
Rabobank
sized companies and to several government departments. Total Specific Solutions serves many of
The Rabobank Group is a full-range financial ser-
the well-known companies which have an impact
vices provider founded on cooperative principles.
on our daily lives.
Rabobank designed a new application for the fixation of signatures and proxies. Our quality assurance specialist KZA, was asked to work with future users and come up with recommendations to improve the functional use and user friendliness of the new application before it was
Our Top 10 customers are:
rolled out to these end users. By being the linking pin between the future users and software
ASML
designers within the framework of the Rabobank
Dutch Tax Authorities (“Belastingdienst�)
organisation, KZA assured not only a smooth im-
ING Group
plementation but also lower maintenance fees
NXP Semiconductors Group
on an ongoing basis.
Philips PON Rabobank Group Terberg Leasing Thomson Corporation UWV
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Annual Report 2007 Total Specific Solutions
The company achieved this position by focussing on its key competencies, its market position and the leveraging of its expertise.
The Right Solutions
Handshake Solutions
The Company’s success is based on its ability to deliver the right solutions and skills to its clients.
Handshake Solutions, a line of business within the
Total Specific Solutions understands what drives
Philips Technology Incubator, offers a rigorous
companies and how to support them in achieving
design methodology and associated toolset for
their goals. Its in-depth knowledge of specific
clockless, self-timed Integrated Circuits. This
markets and the related areas of expertise put the
technology enables ultra low-power and low
company ahead of the competition.
electromagnetic emission electronic applications, and has been used in more than 25 successful products, representing hundreds of millions of ICs. The TiDE toolset is an add-on to existing EDA flows and offers designers a smooth design-in Professionals to Staff ratio
Revenue by Solution 18 %
of asynchronous circuits. Handshake Solutions
12
has recently started a new product development trajectory and TASS Software Professionals deli-
46 %
Consulting
vered two Software Architects to strengthen 88 % Staff their Research & Development team. TASS Soft-
Services
ware Professionals has been selected because
Software
36 %
Professionals
of their unique combination of knowledge in the field of embedded software development and high quality software design, and the quality and flexibility of the TASS Account Team, in short: ‘high quality software services’.
Proven Total Specific Solutions is considered by clients and industry experts alike to be a leader in its speRevenue by Market 28 %
6
Industry Technology & Telecom Public
4%
Male/Female FTE as at 31 December 2007
17
49 %
3% 16 %
Female
83 %
Annual Report 2007 Total Specific Solutions
GMT Software company GMT provides several software products for different industries. Currently one of its software products for the waste mana gement industry needs to be migrated to a 3-tier Service Oriented solution. Our software solutions provider Nethrom, is currently delivering the required solution and skills for this migration due to its lengthy experience with respect to migrations and their knowledge of Progress and .Net. cific market segments and areas of expertise. The company achieved this position by focussing on its key competencies, its market position and the leveraging of its expertise. By being a consistent trendsetter over a long period of time, Total Specific Solutions has continuously improved its products and services to be able to maintain its leading role. Several solutions have been a part of the company’s offerings for several decades. Total Specific Solutions is committed to deliver these valueadding solutions also into the coming decades. Total Specific Solutions is convinced that its client focus and its right and proven solutions are the ideal mix to meet its clients’ ICT needs.
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Annual Report 2007 Total Specific Solutions
Specific Solutions
Consulting Solutions Quality Assurance From a practical standpoint, one of the most important lessons to be learned from the past is that, although ICT can provide a business with essential competitive advantages, the risks this creates have
We are committed to deliver our in-depth knowledge and market expertise to our clients. Currently we offer a range of specific solutions.
also become more important than ever. Today, an ICT disruption can paralyse a company’s ability to manufacture its products, deliver its services and connect with its customers – not to mention tarnishing its reputation. Our Quality Assurance team optimises the effectiveness and efficiency of products, processes and organisations, so that cost levels are brought down, ICT implementation schedules are shortened and client expectations are met. Our ultimate goal is to fully align our clients’ ICT capabilities with the objectives and requirements of their businesses.
Service Solutions Testing Our company has a longstanding track record with respect to software and systems testing. This has helped us to refine our approach and to overcome the many pitfalls. Too often responsibilities
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Annual Report 2007 Total Specific Solutions
Consulting, Services, Software: Specific ICT Solutions.
are not clearly defined within the Test Value Chain and consequently too much testing is carried out,
PON
leading to high costs, unnecessary delays and budget overruns. We prefer to test with a vision.
PON owns several companies within the auto-
We are able to assure the quality required in our
motive industry. Until recently, most of the
client’s ICT solutions, and we do this by clearly
PON group companies used various software
defining both the steps necessary within the Test
packages for their lease business. Co-maker,
Value Chain and the underlying responsibilities
our software supplier for leasing, finance and
and requirements, and by establishing the appro-
rental, is currently implementing its software
priate level of coordination between the supplier,
solution LeaseOffice at various PON subsidia-
ourselves and the ultimate client.
ries. LeaseOffice is the ERP solution for the fleetmanagement, automotive leasing, finance
Top Talent
and short term rental industry. The extensive
An increasingly tight labour market, due to demo-
implementation and migration process will be
graphic and skill trends, is causing severe difficul-
finalised during the first half of 2009. Eventually
ties to many companies. Where and how do you
the solution will be centrally hosted at PON’s
find the talent you need? In addition, we are all
main ICT location.
currently on the brink of a major change in the way the relationships between employer and employee are structured. Traditional arrangements will be turned on their heads. Employees are now looking for inspirational jobs, they want to be guided and coached on the job, and they want to increase their employability. Really talented people are harder to find than ever before and they are very demanding – but they still lack the capabilities and skills needed and therefore require training and coaching. Our Top Talent unit provides
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Annual Report 2007 Total Specific Solutions
Our ultimate goal is to fully align our clients’ ICT capabilities with the objectives and requirements of their businesses.
the solutions required for clients facing these challenges, both for general business positions as well as for specific ICT assignments. Embedded Software Our Embedded Software unit has been a pioneer in the market for embedded software since the 1970s and has been involved in the fast and efficient development of innovative products ever since. Each day, newly developed and highly technological products are launched onto the market and their software is an important and growing component. Our skilled people have a deep understanding of embedded software and applicati-
flexible way and with a shorter time-to-market as
on software at varying levels. We have achieved
the conditions rapidly change. Many software
this technological edge due to our early involve-
applications are outdated and not up to standard.
ment in many breakthrough projects. We therefo-
The costs of the enhancements needed are high
re offer specialised services and solutions in tech-
and they are time-sensitive. Our nearshore faci-
nical and embedded software. This expertise is
lity in Eastern Europe has the competencies re-
available for our customers as a total solutions
quired to be able to carry out the necessary soft-
package, on a project or consultancy basis.
ware upgrades, renovations and/or migrations at attractive prices and within the required timeli-
Software Development
nes. We have been providing solutions with res-
In many industries companies are being forced
pect to software analysis, design, development,
to adapt and modify their ICT systems and rela-
engineering, testing and maintenance since the
ted software. They are being required to connect
early 1990s.
with their customers, their suppliers and their own human resources in a much better and more
10
Annual Report 2007 Total Specific Solutions
Software Solutions
Friesland Bank
Procurement Our procurement unit is the leading provider of in-
This Dutch Bank was looking for a procurement
tegrated solutions for spend management. We pro
system which could provide its entire organisa-
vide a software solution covering all of our clients’
tion with access to purchase contracts and
requirements for procurement processes: from
which could deliver supporting tools to monitor
sourcing the product to getting it paid for. The solu-
its contractual obligations and notice periods.
tion makes all the processes transparent, gives full
Friesland Bank also wanted to set up a bank-
insight into cost categories and provides our clients
wide vendor management system for Internal
with the execution tools they need. The software is
Audit and Governance purposes as well. ESIZE,
delivered by means of a SaaS (Software as a Service)
our procurement software solution provider, has
which enables customers to minimise investments
successfully implemented its procurement sys-
in software and hardware and to reduce maintenan-
tems to fulfil these requirements. By connecting
ce and management costs, while still having full ac-
the order-to-pay cycle in an enhanced manner in
cess at all times to the latest version of the solution.
the second phase of the project, Friesland Bank has been guaranteed maximum results in both
Lease
direct and indirect cost savings.
We are the leading provider of package software solutions for organisations operating in the areas of fleet management, automotive leasing, finance and short term rental. Our ERP product Lease Office is considered to be leading and is a modern and proven solution for national and international businesses operating in a competitive market. It supports the entire lifecycle of a contract, from initiating a contact with a prospect to the settlement of a contract.
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Annual Report 2007 Total Specific Solutions
Revenue by Solution 18 %
Directors’ Report
Markets & Clients Software
46 % 36 %
Our Consulting markets developed relatively favourably during 2007. According to the survey “ICT MarktServices
It is with pride that we present this report to the shareholders and other stakeholders for the first time in this current form. In 2006
monitor 2007”(1), the Dutch IT sector as a whole grew by 7.6% in 2007, more than double the growth of the Dutch economy. The software segment has shown an even more robust growth, recording an increase of 9.5%. Demand was also strong in our international markets.
Total Specific Solutions laid the foundations for its current business model and this is already
Revenue by Market 28 %
proving to be beneficial to our clients, employees, Industry
shareholders and other stakeholders.
Technology & Telecom
4%
49 %
3% 16 %
Public Consumer Finance
Our clients are nearly all Top 200 companies. Our Top 10 clients are all leading brands in their mar(1)
12
The ICT Marktmonitor 2007 survey is created and published by ICT-Office.
kets and they generate 56% of our revenue.
Annual Report 2007 Total Specific Solutions
Our clients are nearly all Top 200
Solution
Professionals to Staff ratio
companies and our Top 10 clients
18 %
12 %
46 %
are all leading brands in their markets.
36 %
Staff
88 %
Professionals
Market
49% of our revenue is earned in the Technology & 4 % We serve large, well established Telecom market.
28 %
Male/Female FTE as at 31 December 2007
17 %
companies in this sector. The sectors Finance and
Telecom
Public together represent another 44% of revenue. 49 % 3%
All16these sectors are information intensive indus%
tries and provide excellent opportunities for our services and products. The remaining 7% of
Female
83 %
Male
turnover is generated in the industry and in the consumer goods markets.
Human Resources Our well trained and skilled workforce is highly Close to 600 people were employed by Total Spe-
committed to its professional approach to the
cific Solutions in the year 2007, with just under
challenging developments in the markets we
20% being female – a percentage we hope to in-
serve and is proud of the expertise we deliver.
crease further in the coming years.
Our commitment to offering best-in-class solutions generates high levels of motivation (reflected in an exceptionally low sickness rate of only 2.6%) and it provides a solid base for funding new re-
Professionals to Staff ratio
cruits. 12 %
During 2007 several salary and benefit components have been restructured and harmonised inStaff Professionals
88 %
ternally to bring them into line with current labour market conditions. We intend to continue to grow our labour force
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Annual Report 2007 Total Specific Solutions
and have therefore significantly strengthened our corporate recruitment activities during the year.
Schuitema
We expect to reap further benefits from this in 2008 and beyond.
Schuitema, the company behind the C-1000 retail shopping chain, has developed tailor made
Internal Controls & Risk Management
billing systems which are being used by their franchise companies. It is of great importance to Schuitema to guarantee a constant high quality
We define the risk profile of our company in terms
of these systems. Schuitema has therefore de-
of market, financial and operational risks.
veloped a testing centre where new hard- and software is intensively tested before used in
Our strategy aligns the long experience we have
operations. Test Value, our testing solutions pro-
in the ICT industry and our solid track record with
vider, has started in 2007 with support in this
current market conditions. The development of
test centre at Schuitema.
the strategy is an ongoing process which critically assesses our opportunities and threats within the context of our strengths and weaknesses. Our strategic goals are translated into a system of long-term business planning, detailed monthly reporting and quarterly reviews. Our administrative organisation and internal control have been further upgraded and new accounting and reporting rules have been implemented within the company. This process will be fully completed in the coming few months. Recently acquired companies will make the changes necessary to comply with our strict policies.
14
Annual Report 2007 Total Specific Solutions
Our strategy aligns the long experience we have in the ICT industry and our solid track record with current market conditions.
Our operational risks are addressed by means of
locate budget to such projects on the premise
strong project management and detailed repor-
that value prevails over price. This is reflected
ting systems. Risks are identified and assessed
in our EBITAE margin of 17.3% on an annua-
clearly and transparently at an early stage in the
lised basis.
work evaluation process, then monitored and managed by means of a comprehensive system of
Our capital ratio (at nearly 20%), our net debt to
review.
EBITDAE ratio (at only 2.1), our excellent financial arrangements with banks and the support of
Financial Results
our strong equity partners all provide us with the sustainability we need and allow ample opportunity for future growth. Our business model has
Due to our strong customer focus, operational
been sufficiently tested in the past and our stra-
efficiencies and rigorous cost management, we
tegy is well accepted by our markets. We are
have been able to generate a strong EBITAE of
therefore convinced of our way forward.
€9.4m on a annualised basis for 2007 (we refer to the Reconciliated Profit and Loss Account). Likewise, our operating cash flow was strong. Our
Outlook
Net Profit was impacted by acquisition-related costs such as non-recurring transaction costs (le-
We acquired a number of solution providers in
gal, due diligence, advisory etc.) and amortisati-
2007. These companies are ready for a more out-
on of Goodwill. All the companies we have ac-
ward focus, and this should accelerate growth in
quired fit well into our strategy, are market lea-
2008. We therefore expect that, with current full
ders in their areas of expertise, and demonstrate
year revenues in excess of €54 million, the orga-
strong and sustainable EBITA performance.
nisation will grow organically and revenue will exceed €60 million in 2008. In addition, we ex-
We focus on delivering added value for our
pect to acquire more solution providers in 2008,
customers by offering best-in-class solutions.
as a result of which overall full year revenue is
We believe that customers are prepared to al-
likely to exceed €80 million.
15
Financial Statements
Annual Raport 2007 Total Specific Solutions
Consolidation Policies
Accounting Policies – general General The general policy for the valuation of assets and liabilities and the determination of results, is the historical purchase price or manufacturing cost. Unless otherwise stated, assets and liabilities are stated at the values at which they were acquired or incurred. Company activities The Company can be classified as an ICT company. Its subsidiaries advise on information systems and supply management advice and training in this field. Policies of consolidation The consolidated accounts include the assets, liabilities and results of Total Specific Solutions B.V. and its group companies in which it holds majority interest. The financial statements of the parent and its subsidiaries are combined on a line by line basis by adding together like items of assets, liabilities, equity, income and expenses. The minority interest in the consolidated equity has been shown separately. Unrealised inter-company results included in inventories at balance sheet date, resulting from inter-company transactions and
16
Annual Report 2007 Total Specific Solutions
inter-company balances, have been eliminated. Retained profits of group companies which can-
Accounting Policies – assets and liabilities
not be distributed without restriction, have been added to the legal reserve.
Intangible fixed assets Intangible fixed assets are stated at purchase price
The consolidated accounts include the financial
or manufacturing costs. Depreciation is calculated
statements of:
on a straight-line basis over the estimated payback period. Purchased goodwill, on acquisition
· Total Specific Solutions B.V.;
stated at net-equity value, is included in the
· Information Value Group B.V. (78.05%);
balance sheet and amortised over a maximum pe-
· Kwaliteitszorg in de Automatisering
riod of five years.
(KZA) B.V. (78.05%); · Test Value B.V. (78.05%);
Tangible fixed assets
· TopTalentConsultancy B.V. (95.01%);
Tangible fixed assets are stated at acquisition cost
· TSS TH Forward B.V. (70%);
less depreciation calculated on a straight-line
· Rorema Beheer B.V. (70%);
basis over the estimated useful life. Acquisitions
· Co-maker B.V. (70%);
during the year are depreciated from the date of
· TASS Holding B.V. (88.67%);
acquisition.
· TASS B.V. (88.67%); · TASS Belgium N.V. (88.67%);
Financial fixed assets
· TSS TH Nearshore (70%);
Subsidiaries and other participating interests
· Comprove B.V. (70%);
in which significant influence may be exerted
· Nethrom Prodimpex SRL (70%).
are stated at net asset value, using the equity method. The net asset value is calculated on the basis of the accounting policies included in these financial statements. If the net asset value is negative, a provision is formed. Retained profits of group companies which cannot be
17
Annual Raport 2007 Total Specific Solutions
distributed without restriction, have been added
Long-term liabilities
to the legal reserve. The other financial fixed as-
Long-term liabilities represent liabilities payable af-
sets are stated at face value after deduction of a
ter one year. The short-term portion (due within one
provision for bad and doubtful debts where ap-
year) has been included in short-term liabilities.
propriate. Current liabilities Receivables
Current liabilities are stated at the values at which
Accounts receivable are shown after deduction of
they incurred and are payable within one year.
a provision for bad and doubtful debts where appropriate. The accounts receivable are due within
Pensions
one year.
The Company operates a pension plan for its staff that qualifies as a defined contribution plan. The
Cash and banks
Company’s sole obligation is payment of an an-
Cash and bank balances are freely disposable, un-
nual contribution to the insurance company. The
less stated otherwise.
Company does not form a provision for any future increases in the contributions.
Minority interest The minority interest in the consolidated equity is equity of the companies concerned.
Accounting Policies – profit and loss account
Provisions
General result
Provisions included under this heading are for lia-
Profit is determined as the difference between net
bilities and risks arising in the ordinary course of
sales and all expenses relating to the reporting
business. They are accounted for at estimated
period. Costs are determined in accordance with
amounts due, except for the provision for jubilee
the accounting policies applied to the balance
which is stated at present discounted value of fu-
sheet items. Profit is realised in the year in which
ture liabilities.
the sales are recognized. Losses are taken upon
stated at the third parties’ share in the underlying
18
Annual Report 2007 Total Specific Solutions
recognition. Other income and expenses are allo-
Income from participations in group and associa-
cated to the periods to which they relate.
ted companies The income form participations in group and as-
Net sales
sociated companies concern the interest of the
Net sales constitute the proceeds of sales of servi-
company in the result of participations, stated at
ces to third parties less discounts.
net asset value.
Depreciation and amortisation
Minority interests
Depreciation on fixed assets is calculated at fixed
Minority interests in results represents the pro
percentages of cost, based on the estimated use-
rata share of outside shareholders in the results
ful life of the assets. The percentages are:
of group companies.
Goodwill Intellectual property rights
20% 20%
Inventory
33.33%
Automation equipment
33.33%
Accounting Policies – cash flow statement The cash flow statement has been prepared using
Financial income and expenses
the indirect method. The funds in the cash flow con-
Financial income and expenses relate to interest
sists of, cash at bank and in hand current account
received or due from and paid or due to third par-
debt at the bank. Cash flows denominated in foreign
ties and group companies.
currencies have been translated at an estimated average rate. Exchange differences income and ex-
Tax
penditure owing to interest and tax on profits have
Taxation on profits is calculated on the reported
been included under the cash flow from operating
pre-tax profit or loss, taking into account any los-
activities.
ses carried forward from previous financial years, tax-exempt items and non-deductible expenses applying current tax rates.
19
Annual Raport 2007 Total Specific Solutions
Consolidated Balance Sheet as at 31 December 2007 (after appropriation of result)
31 December 2007 (x EUR 1,000)
Assets
Development expenses
Intellectual property rights
Goodwill
469 2,900 29,486
Total Intangible Fixed Assets
Other fixed assets
621
Prepayments tangible fixed assets
107
Total Tangible Fixed Assets
Subsidiary
Receivable from associated companies
32,855
728
96 146
Total Financial Fixed Assets
242
Trade debtors
Receivables from group companies
9,296 163
Tax and social security contributions
694
Other current assets
Cash at bank and in hand
1,755 23
20
Total Current Assets
11,931
Total Assets
45,756
Annual Report 2007 Total Specific Solutions
31 December 2007 (x EUR 1,000)
Equity and Liabilities
Shareholders’ equity
7,050
Minority interests
1,461
Total Group Equity Other provisions
103
Provisions Amounts due to credit institutions
8,511
103
14,269
Total Long-term Liabilities
Amounts due to credit institutions
6,440
Trade creditors
2,619
Amounts due to associated companies
Tax and social security contributions
Other liabilities and accrued expenses
14,269
406 2,543 10,865
Total Current Liabilities
22,873
Total Equity and Liabilities
45,756
21
Annual Raport 2007 Total Specific Solutions
Consolidated Profit and Loss Account for the year ended 31 December 2007
2007 (x EUR 1,000)
Net Sales
Cost of sales
Movements in stock and work in progress
45,709
3,091 (43 ) 3,048
Gross Margin
42,661
Wages and salaries
Social security contributions
2,900
Pension contributions
1,391
Depreciation
9,660
Other operating expenses
22,852
11,003 47,806
Operating Result
Interest income
Interest expenses
(5,145 )
48 (1,731 ) (1,683 )
Result before Taxation
Taxes on income
Result after Taxation
(6,828 )
543 (6,285 )
22
Income from participations in group and associated companies
(138 )
Result from Ordinary Activities after Taxation
(6,423 )
Minority interests
1,148
Net Result
(5,275 )
Annual Report 2007 Total Specific Solutions
Consolidated Cash Flow Statement for the year ended 31 December 2007
2007 (x EUR 1,000)
Cash Flow from Operating Activities
Operating result
(5,145 )
Adjustments for:
Depreciation and amortisation
Movements in provisions
Movements in minority interest
9,660 103 1,461
Receivables
(11,908 )
Current liabilities (banks excluded)
20,355
Financial income and expenses
Tax
Participations in group and associated companies
Minority interests
8,447
(1,683 ) 543 (138 ) 1,147
11,224
Movement in working capital:
Total Cash Flow from Operating Activities
(131 ) 14,395
Cash Flow from Investing Activities
Investments in intangible fixed assets
Investments property, plant and equipment
Increase financial fixed assets
Disposals of intangible fixed assets
Disposals of tangible fixed assets
(42,101 ) (1,163 ) (242 ) (63 ) 83
Total Cash Flow from Investing Activities
(43,486 )
Cash Flow from Financing Activities
Movements in shareholders’ equity
Movements in share premium
5,000 7,325
Increase in long-term liabilities
14,269
Total Cash Flow from Financing Activities
26,594
Movements in Cash
(2,497 )
The movements of funds is as follows:
Balance as at 1 January
Movement for the year
(2,497 )
0
Balance as at 31 December
(2,497 )
23
Annual Raport 2007 Total Specific Solutions
Notes to the Consolidated Balance Sheet as at 31 December 2007 (All amounts in EUR 1,000 unless otherwise stated)
Assets
31/12/2007
1. Financial Fixed Assets Subsidiary ESIZE Holding B.V.
96
2. Current Assets Tax and social security contributions This represents a deferred corporation tax asset and has been calculated at the rate of 15%.
Equity and Liabilities 3. Group Equity Shareholders’ equity is further detailed in the notes to the company balance sheet. 4. Provisions Other provisions Other provisions
103
Concerns a provision for jubilee. This provision can be classified as long-term. 5. Long-term Liabilities Amounts due to credit institutions Loans contracted
14,269
The Company’s subsidiaries have been granted rollover loan facilities at the ABN AMRO Bank N.V. amounting to €26,288,000 on which quarterly payments of €1,386,250 are made. In addition to the rollover loan facilities, the Company’s subsidiaries have been granted overdraft facilities by ABN AMRO Bank N.V. amounting to €4,537,500.
24
Annual Report 2007 Total Specific Solutions
Pledges have been supplied on the following assets as security: · shares in the capital of the companies; · rights under the Sale and Purchase Agreements; · stocks; · trade receivables; · inventories. Finally, one of the Company’s subsidiaries has a rollover loan facility in the amount of €2,000,000 which is subordinated to the loan from ABN AMRO Bank N.V. 6. Contingent Liabilities Rental- and lease commitments The company has rental and lease commitments totalling approximately €4,800,000. Tax group TSS TH Forward B.V. and its subsidiaries Rorema Beheer B.V. and Co-maker B.V. form a tax group for corporation tax and value added tax purposes, under which TSS TH Forward B.V. and its subsidiaries are jointly and severally liable for the corporation tax and value added tax liabilities of the tax group. Information Value Group B.V. and its subsidiaries Kwaliteitszorg in de Automatisering (KZA) B.V. and Test Value B.V. form a tax group for corporate income tax and value added tax purposes, under which Information Value Group B.V. and its subsidiaries are jointly and severally liable for the corporate income tax and value added tax liabilities of the fiscal unity. TASS Holding B.V. and its subsidiary TASS B.V. form a tax group for corporation tax purposes, under which TASS Holding B.V. and its subsidiary are jointly and severally liable for the corporation tax liabilities of the fiscal unity. TSS TH Nearshore B.V. and its subsidiary Comprove B.V. form a tax group for corporation tax purposes, under which TSS TH Nearshore B.V. and its subsidiary are jointly and severally liable for the corporation tax liabilities of the fiscal unity. Bank guarantees The Company’s bank has granted bank guarantees totalling €251,600. Capital commitments The capital commitments amount to €231,000.
25
Annual Raport 2007 Total Specific Solutions
Notes to the Consolidated Profit and Loss Account for the year ended 31 December 2007 (All amounts in Eur 1,000 unless otherwise stated)
2007
1. Revenues and Gross Margin Net sales
45,709
Cost of sales
(3,091 )
Movements in stock and work in progress
43 42,661
2. Financial Income and Expenses Interest income Interest on loans receivable
31
Miscellaneous
17
48
Interest expenses Interest on loans payable Miscellaneous
1,313 418 1,731
3. Taxes on Income Corporation tax charge
151
Deferred tax benefit
(694 )
(543 )
4. Income from Participations in Group and associated companies ESIZE Holding B.V.
5. Other information Number of employees On 31 December 2007, 535 staff were employed on a full-time basis.
26
(138 )
Annual Report 2007 Total Specific Solutions
Company Balance Sheet as at 31 December 2007
31 December 2007 (x EUR 1,000)
Assets
Intangible fixed assets
Tangible fixed assets
1,385 4
Financial fixed assets
5,401
Total Fixed Assets
Receivables
303
Receivables from group companies
611
Other current assets
881
Cash at bank and in hand
Total Current Assets
1,863
Total Assets
8,653
6,790
68
Equity and Liabilities
Share capital
Share premium
5.000 7,325
Other reserves
(5,275 )
Total Equity
Trade creditors
Amounts due to group companies and
jointly and severally related parties
Tax and social security contributions
Other liabilities and accrued expenses
Total Current Liabilities
1,603
Total Equity and Liabilities
8,653
7,050
88 592 31 892
27
Annual Raport 2007 Total Specific Solutions
Company Profit and Loss Account for the year ended 31 December 2007
2007 (x EUR 1,000)
28
Income from participations in group and associated companies
(4,694 )
Result from Ordinary Activities after Taxation
(581)
Net Result
(5,275 )
Annual Report 2007 Total Specific Solutions
Notes to the Company Balance Sheet as at 31 December 2007 (All amounts in Eur 1,000 unless otherwise stated)
Equity and Liabilities 1. Shareholders’ equity
Issued
Share
Other
share capital
premium
reserves
Total
Appropriated profit this financial year Result for the year Issue of common shares Other movements Balance as at 31 December 2007
0
0
(5,275 )
(5,275 )
5,000
0
0
5,000
0
7,325
0
7,325
5,000
7,325
(5,275 )
7,050
Share capital The authorised share capital of Total Specific Solutions B.V. amounts to €20,000,000, comprising 15,000,000 A shares and 5,000,000 B shares, with a nominal value of €1 each. Issued are 4,333,000 A shares and 667,000 B shares. 2. Contingent liabilities Liabilities according to Art. 403 BW2 Total Specific Solutions B.V. is liable for its subsidiaries, except for ESIZE Holding B.V. and ESIZE Netherlands B.V. 3. List of interests held · TopTalentConsultancy B.V., Blaricum, 95.01%;
· Rorema Beheer B.V., The Hague, 70% (indirect);
· TASS Holding B.V., Blaricum, 88.67%;
· Co-maker B.V., The Hague, 70% (indirect);
· TASS B.V., Blaricum, 88.67% (indirect);
· TSS TH Nearshore B.V., Blaricum, 70%;
· TASS Belgium N.V., Leuven Belgium,
· Comprove B.V., Wijk bij Duurstede, 70%
88.67% (indirect); · Information Value Group B.V., Blaricum, 78.05%; · Kwaliteitszorg in de Automatisering (KZA) B.V., Baarn, 78.05% (indirect); · Test Value B.V., Baarn, 78.05% (indirect); · TSS TH Forward B.V., Blaricum, 70%;
(indirect); · Nethrom Prodimpex SRL, Cluj Napoca Romania, 70% (indirect); · ESIZE Holding B.V., Weesp, 50.03%; · ESIZE Netherlands B.V., Weesp, 50.03% (indirect).
29
Annual Raport 2007 Total Specific Solutions
Notes to the Company Profit and Loss Account for the year ended 31 December 2007
1. Art. 402 BW 2 The consolidated financial statements include the financials of Total Specific Solutions B.V. Therefore, in accordance with section 402 of Book 2 of the Netherlands Civil Code, the company profit and loss account of Total Specific Solutions B.V. comprises the items shared in the profit/loss of participating interests after taxation and other profit/loss after taxation. 2. Other Information Average number of employees During 2007 one employee was employed on the basis of a full time contract of services.
Blaricum, 13 February 2008 Total Specific Solutions B.V.
The Board of Directors, Tjitske Beheer B.V.
Tjitske Strikwerda
30
Annual Report 2007 Total Specific Solutions
Auditor’s Report Report on the financial statements
reasonableness of accounting estimates made by management, as well as evaluating the overall
We have audited the accompanying financial
presentation of the financial statements.
statements 2007 of Total Specific Solutions, Blaricum, on the pages 16 to 30, which comprise the
We believe that the audit evidence we have ob-
balance sheet as at 31 December 2007, the profit
tained is sufficient and appropriate to provide a
and loss account for the year then ended and the
basis for our audit opinion.
notes. Opinion Management’s responsibility
In our opinion, the financial statements give a true
Management is responsible for the preparation
and fair view of the financial position of Total
and fair presentation of the financial statements
Specific Solutions as at 31 December 2007, and of
and for the preparation of the management board
its result for the year ended 31 December 2007 in
report, both in accordance with Part 9 of Book 2 of
accordance with Part 9 of Book 2 of the Nether-
the Netherlands Civil Code. This responsibility in-
lands Civil Code.
cludes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to
Report on other legal and regulatory requirements
fraud or error; selecting and applying appropriate accounting policies; and making accounting esti-
Pursuant to the legal requirement under 2:393 sub
mates that are reasonable in the circumstances.
5 part e of the Netherlands Civil Code, we report, to the extent of our competence, that the manage-
Auditor’s responsibility
ment board report is consistent with the financial
Our responsibility is to express an opinion on the
statements as required by 2:391 sub 4 of the Ne-
financial statements based on our audit. We con-
therlands Civil Code.
ducted our audit in accordance with Dutch law. This law requires that we comply with ethical requirements and plan and perform the audit to obtain
Dordrecht, 13 February 2008
reasonable assurance whether the financial statements are free from material misstatement. BDO CampsObers Audit & Assurance B.V. An audit involves performing procedures to obtain
On behalf of,
audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstate-
A.D. den Braber RA
ment of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circum stances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the
31
Annual Raport 2007 Total Specific Solutions
Other Information Provisions in the Articles of Association governing the appropriation of profits In accordance with Article 16 of the Company’s Articles of Association, the result for the year is at the free disposition of the Annual General Meeting of Shareholders. Profits may only be distributed to the extent that they are not restricted by legal reserves and accumulated losses.
Appropriation of result Management proposes to the General Meeting of Shareholders that the result for the year be charged to the Other Reserves. The financial statements have been prepared on the assumption that this result appropriation will be adopted by the Annual General Meeting of Shareholders.
32
Annual Report 2007 Total Specific Solutions
Introduction to the Reconciliated Profit and Loss Accounts General Pursuant to Part 9 of Book 2 of the Netherlands Civil Code the results of the companies acquired during 2007 have been included in the Consolidated Profit and Loss Account on page 22, as from the month in which actual control was obtained. Nevertheless, the results of those companies accrue to Total Specific Solutions B.V. for the entire period from 1 January to 31 December 2007. A company which was i.e. acquired in November of 2007 will only report November and December 2007 revenues in the Consolidated Profit and Loss Account on page 22. The results for the period January – October 2007 are reported in the Other Reserves of the afore-mentioned company. One company, which was more than 50% owned during 2005 and 2006, has not been consolidated due to specific agreements with local management. As the Consolidated Profit and Loss Account included in this report therefore does not include the full year separately for information purposes. This Consolidated Profit and Loss Account – Calendar Year, presented on page 36, includes the revenues for the period of January – December 2007 for all companies. To present a complete overview, the Consolidated Balance Sheet – Calendar Year has been added.
Other
results for all companies, a Consolidated Profit and Loss Account for the calendar year has been included
33
Annual Report 2007 Total Specific Solutions
Consolidated Balance Sheet Calendar Year (after appropriation of result)
as at 31 December 2007 (x EUR 1,000)
Assets
Development expenses
Intellectual property rights
Goodwill
Total Intangible Fixed Assets
Other fixed assets
621
Prepayments tangible fixed assets
107
29,486
Total Tangible Fixed Assets
Subsidiary
Receivable from associated companies
469 2,900
32,855
728
96 146
Total Financial Fixed Assets
242
Trade debtors
Receivables from group companies
9,296 163
Tax and social security contributions
694
Other current assets
Cash at bank and in hand
1,755 23
34
Total Current Assets
11,931
Total Assets
45,756
Annual Report 2007 Total Specific Solutions
31 December 2007 (x EUR 1,000)
Equity and Liabilities
Shareholders’ equity
7,050
Minority interests
1,461
Total Group Equity Other provisions
103
Provisions Amounts due to credit institutions
8,511
103
14,269
Total Long-term Liabilities
Amounts due to credit institutions
6,440
Trade creditors
2,619
Amounts due to associated companies
Tax and social security contributions
Other liabilities and accrued expenses
14,269
406 2,543 10,865
Total Current Liabilities
22,873
Total Equity and Liabilities
45,756
35
Annual Report 2007 Total Specific Solutions
Consolidated Profit and Loss Account Calendar Year 2007 (x EUR 1,000)
Net Sales
Cost of sales
Gross Margin
4,708
Wages and salaries
Social security contributions
3,384
Pension contributions
1,423
Other operating expenses
54,565
49,857
25,612
9,656 40,075
EBITDAE*
9,782
17.9%
Depreciation
EBITAE*
9,439
17.3%
Amortisation
343
5,144
EBITE*
Exceptional items
EBIT
Interest income & expense
Result before Taxation
Taxes on income
Result after Taxation
4,295
2,024 2,271
(982 ) 1,289
(544 ) 745
Notes * The ‘E’ in EBITDAE, EBITAE and EBITE stands for “Exceptional”. These exceptional costs represent non-recurring expenses related to acquisitions or restructurings. Group companies may book such costs as exceptional only in the first year. After the first year no exceptional expenses are allowed and included.
36
Annual Report 2007 Total Specific Solutions
Reconciliated Profit and Loss Accounts 2007 (x EUR 1,000)
Consolidated
Deduct:
Add:
Profit and Loss
Profit and
Extended
Not Consolidated
Calendar
Loss
Period
Results
Year
Net Sales Cost of sales
45,709 (8,076 ) 16,932 54,565
3,048
(243 )
1,903
4,708
Gross Margin
42,661
(7,833 ) 15,029 49,857
Wages and salaries Social security contributions Pension contributions Other operating expenses
22,852 (4,005 )
6,765 25,612
2,900
(296 )
780
3,384
1,391
101
(69 )
1,423
11,003 (1,672 )
325
9,656
38,146 (5,872 )
7,801 40,075
EBITDAE*
4,515 (1,961 )
7,228 9,782
Amortisation** Depreciation** Exceptional items
9,249 (3,695 )
(410 )
5,144
411
(93 )
25
343
0
0
2,024
2,024
9,660 (3,788 )
1,639
7,511
EBIT/Operating Result
(5,145 )
1,827
5,589 2,271
Interest income & expenses
(1,683 )
357
344
(982 )
Result before Taxation
(6,828 )
2,184
5,933 1,289
Taxes on income
543
(324 )
(763 )
(544 )
Result after Taxation
(6,285 )
1,860
5,170
745
Notes * The ‘E’ in EBITDAE stands for “Exceptional”. These exceptional costs represent non-recurring expenses related to acquisitions or restructurings. Group companies may book such costs as exceptional only in the first year. After the first year no exceptional expenses are allowed and included. ** For comparison reasons, the amount of Depreciation in the Consolidated Profit and Loss Account, being EUR 9,660, has been presented split out to Amortisation and Depreciation.
37
Annual Report 2007 Total Specific Solutions
Notes to the Reconciliated Profit and Loss Accounts 1. Deduct – Extended Period Various companies applied for an extended accounting period in 2006. As a result, additional Revenues and Expenses have been included in the Consolidated Profit and Loss Account on page 22. The amount which apply to the calendar year 2006 have been deducted in the Consolidated Profit and Loss Account for the Calendar Year on page 36. 2. Add Full year results for the companies which are not fully consolidated, as explained in the Introduction to the Reconciliated Profit and Loss Accounts, are added to the Consolidated Profit and Loss Account.
38
Group Companies Co-maker B.V. PO Box 24006, 2490 AA The Hague The Netherlands Tel. +31 70 317 80 40 www.co-maker.nl
ESIZE Netherlands B.V. Leeuwenveldseweg 16A, 1382 LX Weesp The Netherlands Tel. +31 294 752 700 www.esize.nl
KZA B.V. PO Box 249, 3740 AE Baarn The Netherlands Tel. +31 35 543 10 00 www.kza.nl
Nethrom Prodimpex SRL Calea Turzii 36, 400193 Cluj Napoca Romania Tel. +40 264 599 351 www.nethrom.com
TASS B.V.
TASS Belgium N.V.
PO Box 80060, 5600 KA Eindhoven
Gaston Geenslaan 9, B-3001 Leuven
The Netherlands
Belgium
Tel. +31 40 250 32 00
Tel. +32 16 24 16 80
www.tass.nl
www.tass.be
Test Value B.V. PO Box 380, 3740 AJ Baarn The Netherlands Tel. +31 35 685 96 11 www.testvalue.nl
TopTalentConsultancy B.V. PO Box 420, 3740 AK Baarn The Netherlands Tel. +31 35 685 44 38 www.toptalentconsultancy.nl