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S&T AG reports continued rapid profit growth in 2006

New orientation of the enterprise after IMG closing

The S&T Group was exceeding successful in 2006 in further expanding its position as leading IT service provider and consultant in Central and Eastern Europe. The majority of the considerable profit and EBIT growth can be traced to organic growth. In addition, the concern further strengthened its sphere of activities with four targeted acquisitions (BEELC in Poland, Grall in the Czech Republic, UNITIS in Hungary and the SAP division of T-Systems in Turkey). At years’ end 2006, S&T engaged around 2,295 employees. “2006 was an extremely successful year for us. This is also apparent in the development of our stock price and our market capitalisation. Our stock price increased 48% over the course of the year, the market capitalisation to 139.9 million Euros. 2007 will be a big challenge: We already have the approval of the Federal Trade Commission for the acquisition of the IMG Group and expect to close the deal as planned in the first week of April. The integration of IMG will lead to a new orientation of the Business Solutions branch. The integration team is ready, the projects are drafted, in order to start the essential transformation immediately upon closing the deal”, explains Christian Rosner, CEO S&T AG.

Massive core business expansion/strong regions
The organic growth of the enterprise is due primarily to the strengthening of the three core business areas: Business Solutions, Enterprise Systems and Managed Services. S&T grew a decisive 42% in 2006, especially in the area of consulting and solutions (Business Solutions). This business segment will continue to thrive in 2007, as an intensive expansion effort is planned for precisely this division in combination with IMG. S&T also produced substantial growth with infrastructural solutions in the Enterprise Systems segment, as well as with Managed Services. With 218.8 million Euros, the largest contributor to the profit of the company was the central region, including the countries of Austria, Germany, Switzerland, the Czech Republic, Poland, Slovakia and Hungary.

Success in the target sectors
The distribution of turnover in the S&T target industries has, as compared to 2005, only marginally shifted. The largest source of remained the manufacturing sector, which brought in 37% of sales, followed by the telecommunications industry with 21% and the financial services sector with 19%. Orders from the public sector were responsible for 14% of S&T sales and 9% came from projects for energy service provider companies.

IMG integration poised to start / concluded by end of 2007
In January 2007, S&T announced the acquisition of the Swiss SAP consulting agency IMG The Information Management Group. The approval of the trade commission has been granted and the closing is expected in the first week of April. The three-phase (preparation – integration – transformation) planned integration of the more than 600 employees of the powerful international enterprise will lead to a new orientation of the Business Solutions segment of S&T. The responsible integration teams have already been nominated and are on the starting blocks, ready to begin the implementation of the wide-reaching transformation plans. The completion of the integration is planned for the end of 2007.

New positioning
With IMG, S&T will assume a new market position. The strategy and business process consulting will acquire enormous importance and will be actively expanded, as well software development. Simultaneously however, infrastructure services, as well as the area of managed operations will also be further enhanced. The sales and delivery teams in the individual countries will be more closely integrated, and corporate resources and competencies organised on an international level. “Together we have developed our vision and our concrete goals for the coming years, and we want to capitalise on the advantages of that mutual market presence as quickly as possible” explains Rosner.

2007: The year of potential
After the closing of the IMG acquisition the S&T group of companies will operate in 23 countries – primarily in the Germany-Austria-Switzerland region, as well as in Central and Eastern Europe; employ 3,000 people, among them 1,200 consultants; and care for large and mid-sized, national, as well as multinational companies in projects spanning the complete range of the IT value-added chain. Rosner states: “We have a strong starting position this year; planning additional organic investments for general market development in our region and the feedback from the capital markets to our strategy is good. “

S&T 2006 Annual Report
The S&T 2006 Annual Report is available for download on the S&T website or can be requested in printed format (see contact information below).


Issuer: S&T System Integration & Technology Distribution AG
Geiselbergstrasse 17-19
Austria-1110 Vienna
Telephone: +43 1 367 80 88 0
Fax: +43 1 367 80 88 1099
Email: snt@snt-world.com
WWW: http://www.snt-world.com
Exchange: Vienna stock exchange
ISIN: AT0000905351
Indices: ATX Prime, ViDX, WBI
XETRA Vienna: SNT