How to secure your business continuity?
Time to take all the benefits from remote work and collaborate with your customers and colleagues like never before. We collected some practical tips for remote work and digital collaboration below. Read also how we have prepared as a company to the coronavirus pandemic.
Keeping business (un)usual
15 minutes on Digital Advantage
Ever wondered how to continue your digital transformation in a world that changes from day to day?
You’re not alone, and we’re here to help. We’ve come up with concrete actions that you can use today and in the long term, all presented in our vlog series. We know you’re busy, so we’ve kept it short and neat with all episodes being just 15 minutes.
Get to know our thinking
Digital culture is crucial as the Corona crisis changes our business models
The crisis we are facing now is unique in that it is two-dimensional – it strikes against both supply and demand. The way forward is through the digital transformation and towards a digital culture where we dare to test completely new things.
Top notch corona epidemic predictions
It has been said that making an accurate prediction is simple, but not easy; achieving good forecast accuracy is rarely based on a superior forecast model. This spring, the role of different forecasting models and scenarios in the coronavirus epidemic has sparked much debate.Learn more
Supporting the Finnish healthcare sector
Increasing testing capacity in Finland
TietoEVRY joins other major Finnish companies to support increasing COVID-19 testing capacity in Finland. Mehiläinen, a private health care provider in Finland, has created a process, where COVID-19 tests carried out in Finland will be sent to a laboratory in South Korea for analysis on Finnair's charter flights.
Providing healthcare professionals COVID-19 intensive care data
TietoEVRY has collected data from the Finnish intensive care units and their different data sources over two years. Now the data set has been extended to include the COVID-19 information (90 variables). Benchmarking data can be utilized in all intensive care units e.g. to develop patient care and medication. Benchmarking helps organizations to develop their operations based on real-time data. In addition, TietoEVRY provides data directly to the Finnish Institute of Health and Welfare and Ministry of Social Affairs and Health to improve their situational awareness.
The Coronabot gives guidance
The Coronabot is a questionnaire that gives you guidance and instructions in questions related to being exposed to COVID-19 and the symptoms of coronavirus. In addition, the psychiatry specialists of HUS have created a mental support programme to help you process any worries and anxiety caused by the coronavirus situation.
Agile development and support for healthcare organizations in Finland
Healthcare professionals are at the heart of the current coronavirus crisis. We are listening carefully to our Lifecare customers during this exceptional situation and responding to their needs quickly and efficiently. Every week, we publish new functionalities and guidelines to support healthcare organizations during these uncertain times.
Smart solutions to battle the pandemic
AI model can detect COVID-19 on x-rays
TietoEVRY has initiated various initiatives to support critical societal functions and operations during the Corona crisis. Our AI team have, with the help of Machine Learning, analysed multiple lung x-rays, and identified patterns on the radiographs of COVID-19 positive patients, which are different from those with healthy lungs or pneumonia. Now that the AI model has learned to identify these patterns, it only takes seconds to validate if a lung radiograph shows signs of COVID-19. This is still only a test project, and TietoEVRY is currently in dialogue with health providers to find future use-areas.
The Swedish tech industry stand together
TietoEVRY supports #VITECHERUPP, an initiative by the Swedish industry organisation IT&Telekomföretagen. We believe that the entire industry must stand together to find innovative and smart solutions to battle the Coronavirus pandemics, and we have already initiated several proactive projects to battle the Coronavirus.
Supporting the society through data
New initiative to manage crisis
We joined forces and launched an initiative to support managing the Corona crisis in Finland! Together with Tech Finland, Digital and Population Data Services Agency (DVV), Gofore and IBM, we joined forces to solve a societal challenge together.
During a two-week course, the team developed a campaign to gather real-time data sources to support decision-making during Corona. Finding the right sources and bringing together relevant real-time data will support situational awareness and decision-making during the Corona crisis. Through the initiative, data can be donated to benefit society.
Read our latest insights
Coping with a pandemic: Improving citizens’ everyday lives through digital services
Digitalization technologies make our society more inclusive. Describing our recent blockchain experiences in this field.
Virtual is the new reality
During times of crisis, companies are forced to rapidly digitalize their services. What opportunities can virtual reality offer today?
When working from home became the new normal
Overnight, mastering digital tools such as Microsoft Teams has become critical for effective collaboration as people adjust to working from home. Read 9 practical tips for digital collaboration.
Q&A for investors
As at 28 April. We are continuously monitoring the market outlook.
See the answers below
How resilient are your businesses towards the weakening economic outlook resulting from the COVID-19 pandemic?
- Resilience is anticipated to vary by business as described in the table below – overall, around half of the business is based on long-term agreements
|Business logics||Share of Group revenue||Relative impact||Contractual structure|
|Digital consulting||Approximately 30%||Most impacted||
Primarily short-term contracts while relationships with customers are long
Application services with long-term agreements represent approximately 20% of the consulting revenue
|Product development services||Approximately 5%||Impacted less than digital consulting||
Primarily short contracts within long-term commitments contributing to customers' core development roadmaps.
Stability due to our role in customers' key development areas
|Infrastructure services||Approximately 30%||Impacted slightly more than industry software||
Primarily long-term commitments of 3-5 years
Fluctuations in demand in some services in the short term, e.g. increase in network capacity while some onsite installations postponed
|Industry software, incl. Financial Services Solutions||Approximately 35%||Least impacted||Primarily long-term contractual periods up to 5-7 years with customer relationships lasting much longer|
- In Q1, we saw only limited impact of COVID-19 and expect the impacts to start to materialize in Q2 and Q3. We have a healthy backlog and in line with the typical pattern, close to half of the backlog at the end of the first quarter is invoiced during 2020.
What is your exposure to industries most affected by COVID-19?
- Overall, most of our sales comes from sectors not immediately impacted by the pandemic, like public and healthcare sector as well as financial services and telecommunications.
- We have some exposure towards oil and gas, where our business mainly related to software solutions. The company has limited exposure towards the sectors currently hit most, such as travel, transportation, airlines etc.
What level of impact do you expect on 2020 growth?
- Current market indicators imply a negative 2-5% full-year revenue impact due to the Covid-19 pandemic on TietoEVRY, depending on the IT market development. The market situation will be continuously monitored and estimations are updated in accordance with improved visibility.
What kind of plans has TietoEVRY made to mitigate the negative impacts?
- We flexibly take actions when needed, subject to the macro economic outlook. The savings actions applied company-wide include
- Stopping or reconsidering all external recruitments
- Terminating non-billable sub-contracting and reviewing the use of all sub-contractors
- Replacing sub-contractors with own employees where possible
- Purchases e.g. phones, laptops, office equipment will be postponed
- Participation in external events, courses, conferences etc. have been cancelled
- No travelling is allowed at the moment
- Salary increases will be postponed until further notice unless agreed in local collective agreements
- Employees are encouraged to take their annual holidays from previous periods as well as use their saved flex-time hours for days off
- The exchange of holiday bonuses for time off especially in non-billable roles
- The fixed salaries of the CEO and Group Leadership members are also temporarily cut by 15% during a three-month period.
- The company has also initiated consultation concerning temporary layoffs to be able to flexibly adjust the operations when needed. Negotiations have been concluded in Sweden, Norway, Finland and the Czech Republic. The number of affected employees amounts to approximately 400 and will be carried out partly as part-time temporary layoffs. Temporary layoff processes are iterative and the need for temporary leaves is assessed on a regular basis, subject to the magnitude and duration of weakened market conditions.
Will integration and cost synergies be delayed due to COVID-19?
- The measures to complete the integration of Tieto and EVRY continue as planned. The attractiveness of the merger, including cost synergies, stays as announced and is anticipated to contribute to performance in 2020.
- We are continuing along the previously communicated workstreams.
- We will provide with regular updates on our progress with regards to synergies going forward – typically as part of our quarterly reports.
Are you able to continue deliveries as before?
- Our operations have so far run relatively smoothly, while most employees are working from home – ability to work remotely is functioning well across our delivery countries.
- A large portion of our deliveries is related to software, consultancy services and solutions, as well as support, and these are not very dependent on physical presence.
- Our services and solutions related to infrastructure can also to a large degree be delivered remotely. Cloud and infrastructure services are fully operational and there are overall only few systems that require us to be on site. We also operate from several countries to minimize the risk.
- One of our key priorities is naturally to continue to secure deliveries to our customers. Our persistent investments in digital infrastructure, automation and global teams will help us to maintain business continuity for customers also going forward.
What is your financial position?
- TietoEVRY has a sound financial position. As part of the EUR 950 million financing arrangement related to the merger, the Group has a EUR 250 million revolving credit facility as a back-up for the EUR 250 million commercial paper programme to support short-term funding needs.
- The bridge loan that was part of the financing arrangement related to the merger is maturing in September 2020 while it includes a six-month extension option. The company is closely following the development in the credit markets and does not see a risk of not being able to refinance the bridge loan.
Why did you withdraw your guidance?
- The current economic outlook in our main markets involve significant uncertainties. Given the uncertainties in the market outlook, it is not yet possible to estimate the potential impact of the pandemic on the company’s profitability.
- By withdrawing the guidance, we comply with regulations set by the Finnish Financial Supervisory Authority (FIN- FSA) who has given clear instructions on how companies shall act under the exceptional circumstances we see in the market at the moment.
Why did you cancel the AGM?
- Postponement of the AGM was taken as a practical adaption to the physical restrictions related to COVID-19. We had more than 150 people signed up for the 26 March AGM, and we did not want to organize an event that could create a risk for people’s health and also not be compliant with health authorities’ provisions, regulations and recommendations.
AGM of TietoEVRY Corporation on 29 April 2020
Annual General Meeting of TietoEVRY Corporation will be held on 29 April 2020 at 4.00 p.m. EEST at TietoEVRY’s premises, address Keilalahdentie 2-4, 02150 Espoo, Finland.
Due to the coronavirus pandemic and risk of spreading the virus, TietoEVRY strongly encourages all shareholders to follow the Annual General Meeting this year through a live webcast and exercise their voting rights by using the proxy service provided by the company instead of attending the meeting in person.
TietoEVRY withdraws its guidance for 2020
– uncertain market outlook due to COVID-19
Due to the COVID-19 pandemic, the current economic outlook in TietoEVRY’s main markets involve significant uncertainties. Given the uncertainties in the market outlook, it is not possible to estimate the potential impact of the pandemic on the company’s profitability. Hence the current guidance, according to which TietoEVRY expects its comparable full-year adjusted operating profit (EBIT) to increase from the previous year's level, is withdrawn.
Further guidance will be issued as soon as visibility to the market outlook has improved and significant uncertainties are cleared.