Repe Harmanen, CEO, in the Half-year report 1 January–3o June 2025:
“The first half of the year was challenging for our business. Falling short of the sales targets for the first half of the year was reflected in both revenue and profit. Our revenue in January–June was EUR 21.4 (22.8) million and comparable EBITA was EUR 1.7 (2.3) million, or 7.8% (10.1%). The continued uncertainty in the market and the slowdown in investments have forced us to take several measures to safeguard profitability. We will monitor the adequacy of the measures and strengthen our resilience with determination.
During the first half of the year, Netum Ltd carried out change negotiations, which ended on 18 June 2025. The measures implemented as a result of the negotiations will improve our cost efficiency and adapt our operations to the market situation. The personnel reductions are estimated to result in about EUR 1.9 million of permanent savings on an annual basis, but their impact will not be fully visible until 2026. EUR 0.1 million of the costs of implementing the change negotiations has been taken into account in the comparable EBITA for the second quarter, and the remaining EUR 0.2 million will be allocated to the third quarter of the year.
At the same time, we have secured new customers and projects that will start in the autumn and support our future growth. During the summer, the largest tenders won were the construction and maintenance of the farm relief system for the Farmers' Social Insurance Institution of Finland (Mela) (estimated at EUR 4 million, 7 years) and expert services for the development of railway information systems for the Finnish Transport Infrastructure Agency (estimated at EUR 1.6 million, 3 + 2 years).
During the first half of the year, Buutti’s business in particular clearly fell short of its targets, which had the most significant impact on our revenue and profit. Studyo’s business was in line with the targets.
Despite Netum Ltd’s add-on sales and profits from new projects, we are still behind our sales target for this year. It is of primary importance for us to continue to be successful in tenders in the near future in order to compensate for the decline in our revenue and profitability caused by significant ending projects. For example, the transfer of employment services from the central government to municipalities required extensive development projects and the parallel use of systems. We played a significant role in the project, both in system development and production. Following successful deployments in the first half of the year, we will continue as the vendor in the same roles, but with a smaller volume during the rest of the year.
I have met several of our customers from different sectors. The meetings have highlighted confidence in our ability to implement business-critical solutions even in an uncertain market. Our customers particularly appreciate the high level of expertise of our experts and the transparency of our solutions - these factors set us apart in the intense competition.
Our people have demonstrated excellent commitment and flexibility in the midst of change. I would like to thank everyone at Netum for their high-quality work and for building our future competitiveness. I wish all the best to those who were involved in the change negotiations and believe that there is a shared understanding of the company’s situation. Competence development and the wellbeing of our personnel will continue to be the foundation of our long-term success.
Our strategically important AI project is progressing as planned, and we have seen a growing demand for AI solutions that reform processes. In line with our Wise Changemaker mindset, we help customers to leverage AI in existing systems and build new digital capabilities, strengthening our position as a responsible and long-term IT partner.
Our sustainability programme and the preparation of the CSRD project are progressing according to schedule. For us, sustainability is about practical actions and transparent communication that support the sustainable growth of our customers and stakeholders.
We estimate that the demand for IT services will continue at the current level, but the fierce price competition will continue to challenge sufficient margin levels. The fast-paced nature of Buutti Oy's expert services may have a faster impact for the numbers of the rest of the year than Netum Ltd's business model. The current market environment requires close monitoring and flexibility. We are prepared to take the necessary measures if the market situation changes substantially or if the start of projects deviates from the current forecast. We will continue our determined work on profitability and growth in Finland and in accordance with our strategy in the Nordic countries.
I would like to express my warmest thanks to our customers, employees and other stakeholders.”