ACCOUNTING POLICIES | |||
The operating segments are reported in a manner consistent with the internal reporting provided to the Group Executive Management, which has been identified as Tietoevry\u2019s chief operating decision maker being responsible for allocating resources and assessing performance of the operating segments as well as deciding on strategy. | |||
The Group Executive Management assesses the profitability of segments principally on the basis of adjusted operating profit (EBITA). Operating profit (EBIT) is, however, also an essential measure and is disclosed in this segment note as it is most consistent with the result reported in accordance with IFRS. Transactions between the segments are made on a market-terms basis. | |||
Eliminations include internal revenue between operating segments and Group function sales of internal services to the business. Non-allocated costs relate to Global management and Support functions and are shown separately in the operating profit (EBIT). |
ACCOUNTING POLICIES | |||
Revenue is measured based on the consideration to which the Group expects to be entitled in a contract with a customer and excludes consideration collected on behalf of third parties. The Group recognizes revenue when it transfers control of a good or service to a customer. | |||
The Group typically provides customers with a variety of comprehensive services. The individual service delivery contracts are often structured under a common frame contract where general terms for the service delivery to the customer are defined. The content of the delivery, performance obligations and pricing, are defined in the service delivery contracts. Management judgement is used to determine the basis for the revenue recognition; either an individual service delivery contract or a group of combined contracts. | |||
Revenue from service contracts is based on service volumes or time and materials and the performance obligations are recognized over the accounting period in which the services are rendered or project is delivered. The services are generally satisfied and the control transferred to the customer over time given that either the customer simultaneously receives and consumes the benefits provided by the Group, or the Group\u2019s performance does not create an asset with an alternative use for the Group, in which case there is an enforceable right to payment for work completed to date. |
In the majority of the businesses providing continuous services, time and material projects and consulting, the performance obligations satisfied are invoiced on a monthly basis. At the time of invoicing, a receivable is recognized by the Group as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due. The standard payment term is 30 days according to the Group\u2019s Credit Policy. | |||
Goods, typically distinct licenses, that provide a right to use the software, are invoiced on delivery. The license revenue is recognized at a point in time when the license is delivered, the legal title has passed, the customer has accepted the license and has access to the licensed software. Distinct licenses, that provide a right to access the software, are recognized over the contract period. Contract assets or liabilities do not typically arise in the businesses described above. | |||
For contracts comprising fixed-price projects, revenue is recognized based on the actual service provided by the reporting date as a proportion of the total services to be provided. This is determined based on the cost of actual labour hours spent relative to the total expected cost of labour hours, as it best reflects the transfer of control to the customer. Estimates of revenues, costs or progress towards completion are revised if circumstances change and any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management. Invoicing and customer payments in the fixed-price projects follow the payment schedule defined in the customer contract. If the services rendered by the Group exceed the payment, a contract asset is recognized, and if the payments exceed the services rendered, a contract liability is recognized. | |||
The customer contracts of the Group typically comprise several of the business models described above. The most appropriate presentation on how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors is considered to be the disaggregation of sales from long-term fixed-price contracts by segment represents the revenue from contracts for which the risks are different compared to other contracts with customers. | |||
Some contracts include delivery of hardware together with a variety of services from the Group. Hardware is usually provided by another service provider. The installation of hardware is simple, does not include an integration service from the Group and could be performed by another party. It is, therefore, accounted for as a separate performance obligation. In these contracts, Tietoevry acts as an agent, if the Group does not obtain control of the hardware provided by another party before it is transferred to the customer, or as a principal if control is obtained. |
Where the contracts include multiple performance obligations, the transaction price is allocated to each performance obligation based on the stand-alone selling prices, which are observable from the contracts and represent prices for services rendered in similar circumstances to similar customers. Revenue from contracts granting a discount retrospectively to the customer is recognized based on the price specified in the contract, net of the estimated discounts. Discounts are estimated based on management's experience of the earlier purchases of the customers under similar contracts. This estimation is regularly updated during the contract period. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. | |||
In settlement agreement cases, consideration paid to customers is reduced from revenue when a settlement agreement is signed with the customer. Consideration received from customers is recognized as revenue or other operating income depending on the facts and circumstances. | |||
The Group grants assurance type of warranties which guarantee that the delivery complies with agreed specifications. These are accounted for in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. | |||
The Group does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. Consequently, the Group does not adjust any of the transaction prices for the time value of money. | |||
The Group capitalizes material costs of set-up activities related to transition or implementation projects in the initial phase of continuous operating service contracts, when the criteria for capitalization according to IFRS 15 are met. Management judgement has been used when developing internal guidance on the tasks defined as set-up activities in the Group. The set-up activities do not result in the transfer of a promised good or service and are not identified as a performance obligation to the customer. The capitalized costs of a contract are amortized during the period when the revenue for the related continuous operating service contract is recognized. |
EUR million | 2023 | 2022 |
Capitalized set-up costs on 31 Dec | 5.8 | 11.8 |
Amortization of capitalized set-up costs | 6.6 | 8.4 |
ACCOUNTING POLICIES | |||
Government grants | |||
Government grants are recognized as other operating income on a systematic basis over the periods necessary to match them with the related costs that they are intended to compensate. | |||
Research and development costs | |||
Research costs are expensed when incurred. Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development costs comprise service and solution development focusing on, for example, industry-specific software, customer experience management and security services, as well as cloud services. Additionally, the costs for related internal development e.g. automation in infrastructure services, are included in development costs. |
ACCOUNTING POLICIES | |||
Employee benefits are recognised in the period in which services are rendered by the employees. Termination benefits are recognised at the time an agreement between the Group and the employee is made and no future service is rendered by the employee in exchange for the benefits. | |||
Share-based incentive plans | |||
Tietoevry has share-based incentive plans for its key employees which are accounted for as equity- settled. The plans are valued at fair value based on the market price of Tietoevry shares at the grant date and recognized as an employee benefit expense during the vesting period with a corresponding entry in equity. At each reporting date, the number of shares that are expected to vest from the Group\u2019s share-based incentive plans is revised. As part of this evaluation, the changes in the forecasted performance of the Group, the expected turnover of the personnel participating in the plans and other information impacting the number of shares to vest, is taken into consideration. Any adjustments to the initial estimates are recognized in profit or loss and a corresponding adjustment is made to equity. In countries where the reward is intended to be paid fully in cash, the costs are accounted for as cash-settled. Social costs paid on top of the reward are accounted for as cash- settled. |
ACCOUNTING POLICIES | |||
Tax expense for the period includes current taxes of the Group companies based on taxable profit for the year, together with tax adjustments for previous years and changes in deferred taxes. Tax is recognized in the income statement, except to the extent that it relates to items recognized in other comprehensive income or directly in equity, in which case the related income tax is also recognized in other comprehensive income or directly in equity, respectively. The share of results in joint ventures is reported in the income statement based on the net result and thus, including the income tax effect. | |||
Deferred income tax is recognized, using the liability method, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements as well as on tax loss carry forwards. Deferred income tax is determined using the tax rates and laws which have been enacted or substantively enacted at the reporting date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred taxes are not recognized on temporary differences related to investments in subsidiaries to the extent that they will probably not be reversed in the foreseeable future. | |||
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. The deferred tax assets and liabilities arising from consolidation are recognized in the consolidated statement of financial position if it is probable that the related tax effects will occur. |
ACCOUNTING POLICIES | |||
Basic Earnings per share (EPS) is calculated by dividing the net profit attributable to the shareholders of the Parent company by the weighted average number of shares in issue during the year, excluding shares purchased by Tietoevry and held as own shares. | |||
Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding during the year with the shares estimated to be delivered based on the share-based incentive plans. |
ACCOUNTING POLICIES | |||
Intangible assets other than goodwill are recognized initially at cost. An intangible asset is recognized only if it is probable that the future economic benefits attributable to the asset will flow to the Group and the cost of the asset can be measured reliably. All other costs are expensed as incurred. | |||
After initial recognition, intangible assets are measured at cost less amortization and accumulated impairment losses. Intangible assets are amortized over their useful lives with the straight-line method. Assets that are subject to amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Internally developed software | |||
Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development projects are analysed individually to determine the moment when the project has reached a milestone after which capitalization of development costs can start. Only costs which are directly attributable to the development are capitalised. |
Subsequent to initial recognition, these costs are measured at cost less accumulated amortization and impairment losses. The amortization period for internally developed software depends on the technology renewal cycle and contract duration. Internally developed software for which amortization has not yet started is tested for impairment on an annual basis by comparing the asset's carrying amount with its recoverable amount. If the carrying amount exceeds the recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Intangible assets recognised from acquisitions | |||
Intangible assets acquired in business combinations are measured at fair value at the acquisition date. These are usually customer or technology related and have finite useful lives. | |||
Gains and losses on disposal of intangible assets are included in other operating income and expenses. | |||
The Group applies the following useful lives: |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
ACCOUNTING POLICIES | |||
Property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. | |||
Land is not depreciated. Property, plant and equipment acquired in business combinations are measured at fair value at the acquisition date. Depreciation is recognized according to plan based on the estimated economic lives of the individual assets and accounted for in accordance with the straight-line method. The assets' residual useful lives are reviewed, and adjusted if appropriate, at each reporting date. | |||
Assets that are subject to depreciation are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
The group applies the following useful lives: |
Years | |
Buildings and structures | 25\u201340 |
Data processing equipment1) | 1\u20135 |
Other machinery and equipment | 5 |
Other tangible assets | 5 |
ACCOUNTING POLICIES | |||
The Group as a lessee | |||
The Group assesses whether a contract is, or contains, a lease at inception of the contract. The Group recognizes a right-of-use asset and a corresponding lease liability at the commencement date of a lease. Initially, the lease liability is measured at the present value of the future lease payments to be made over the lease period. The lease payments include fixed payments, less any lease incentives receivable, variable lease payments that depend on an index or rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option if it is reasonably certain to be exercised and payments of penalties for terminating the lease if the lease term reflects the exercise of a termination option. | |||
To determine the present value of future lease payments, the Group discounts the lease payments using the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. The incremental borrowing rate reflects the rate at which the Group could borrow an amount similar to the value of the right-of-use asset in a similar economic environment. At year-end, the average annual incremental borrowing rate applied to discount remaining lease payments for existing lease agreements is 5.9%. | |||
The Group determines the lease term as the non-cancellable period of the lease, together with the periods covered by an option to extend the lease, if it is reasonably certain to be exercised, and periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Group has some lease contracts for which the lease term is cancellable with only a short notification period (\u201cevergreen leases\u201d). Management uses judgement to evaluate the lease term for leases with extension or termination options, and for leases with a short notification period. Management estimates the lease term based on overall strategy and business development plans as well as contract specific facts and circumstances. | |||
At 31\u00a0December 2023, the weighted average residual lease term for lease contracts is 6.6 years (residual terms vary between 0.1 - 16.3 years). |
Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets comprises the initial measurement of the corresponding lease liability, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful life of the underlying asset. | |||
Lease liabilities are measured at amortized cost. The carrying amount of lease liabilities is increased to reflect the interest on the lease liability and decreased for the lease payments made. Interest expenses related to the lease liabilities are recognized in profit or loss. The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term or in lease payments, or a change in the Group\u2019s assessment of an option to purchase the underlying asset. | |||
The Group applies the recognition exemption provided for leases. Lease payments for leases of low value assets and short-term leases (less than 12 months) are recognized in the income statement on a straight-line basis. The low value assets comprise IT equipment and office furniture. | |||
The Group has elected to separate the service component of a lease for all asset types, except for cars, where only variable lease payments are excluded from the measurement of the lease liability. Non-lease components are separated from lease payments based on fair market value. If such information is not readily available, management judgment is applied in estimating the value. | |||
The Group presents the payment of the principal portion of the lease liability in the cash flows from financing activities and the interest portion in the cash flows from operating activities. Lease payments related to low value assets and short-term leases are presented in cash flow from operating activities. | |||
The Group as a lessor | |||
If an arrangement conveys a right to use a specific asset to a purchaser, often together with related services, the assets, mainly technical equipment, are classified as embedded finance leases. Further the lease is classified either as Operating lease or Finance lease. At 31\u00a0December 2023, all such cases have been classified as Finance leases. Sales derived from these embedded finance leases are recognized at the beginning of the agreement period. The annual payments are disclosed as amortization of the finance lease loan receivable and interest income. |
ACCOUNTING POLICIES | |||
Trade receivables are initially recognised at fair value and subsequently at amortized cost less expected credit loss allowance (ECL). Tietoevry has elected to use the practical expedient and calculate lifetime ECL based on a pre-defined allowance matrix with customer segment specific credit characteristics, based on the following criteria: \u2022 Country Group (Finland, Sweden, Norway, Other European Union countries, Other countries) \u2022 Customer Industry Group (Financial Services, Public Healthcare & Welfare, Industrial customer Services) \u2022 Balance due status (Not yet due, overdue 1\u20137 days, 8\u201330 days, 31\u201360 days, 61\u201390 days, over 90 days) | |||
Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. Default is defined as 90 days past due or a write off event, due to inability to collect debt. | |||
For each segment, the ECL rate (expressed as a percentage) indicates the historical average defaults identified during the past three years and also the Group\u2019s assessment of the possible impact from changes in the overall economic environment in which its customers operate. These collective allowances can be increased if the customer has filed for bankruptcy but has not yet registered the fact or if there are any facts or circumstances indicating that the customer\u2019s credit risk is above industry/country average. |
No ECL is calculated for the portion of trade receivables, where the credit risk is covered by credit insurance. When calculating ECL for contract assets, Tietoevry uses the ECL rate set for \u201cnot yet due\u201d invoices in the allowance matrix. | |||
Trade receivables are permanently written off when there is no reasonable expectation of recovery. Subsequent recoveries of amounts previously written off are credited to the income statement. Other interest-bearing receivables are initially recognized at fair value and subsequently at amortized cost during the contract period. The carrying amount of the trade and other receivables approximate their fair values due to their short-term nature. |
ACCOUNTING POLICIES | |||
The fixed contributions to defined contribution plans are recognized as employee benefit expenses in the period to which they relate. The Group has no further legal or constructive payment obligations once the contributions have been paid. | |||
Defined benefit plans typically define an amount of post-employment benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. Defined benefit plans are funded with payments to insurance companies. | |||
For defined benefit plans, the net liability recognized in the statement of financial position equals the present value of the defined benefit obligation at the closing date less the fair value of the plan assets. The present value of the defined benefit obligation is determined separately for each plan by independent actuaries using the projected unit credit method. The actuarial calculations include several financial and demographic assumptions and any change in these will impact the carrying amount and future expense of the defined benefit obligation. | |||
Current service costs, past service costs and gains or losses on settlements are recognized in employee benefit expenses. Net interest expense or income is recognized in financial items under interest expense or interest income. All remeasurements of the defined benefit liability or asset arising from experience adjustments and changes in actuarial assumptions are recognized directly in other comprehensive income. |
ACCOUNTING POLICIES | |||
A provision is a liability of uncertain timing or amount which is recognized when the entity has a present legal or constructive obligation as a result of a past event and it is more likely than not that an outflow of economic benefits will be required to settle the obligation and the amount of the obligation can be measured reliably. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation and are split between amounts expected to be settled within 12 months at the end of the reporting period and amounts expected to be settled later (non-current). | |||
Provisions for restructuring | |||
A restructuring provision is only recognized when a formal plan has been approved and the implementation of it has either commenced or the plan has been announced. | |||
Provisions for warranties | |||
The Group's warranties provide assurance that the delivery will function as expected and in accordance with contract specifications. Provisions related to these assurance-type warranties are recognized during the project and used during the warranty period. | |||
Other provisions | |||
Other provisions include provisions for loss making contracts which are recognized for any unavoidable net loss arising from the contract as well as employee related provisions other than restructuring. |
ACCOUNTING POLICIES | |||
Trade and other payables are presented as current liabilities if settlement is due within 12 months from the end of the reporting period. They are recognized at their fair value and subsequently measured at amortized cost using the effective interest method. | |||
The carrying amount of the trade and other payables approximate their fair values due to their short- term nature. |
ACCOUNTING POLICIES | |||
Interest-bearing loans and borrowings are initially recognized at fair value, net of transaction costs which are recognized in the income statement as interest expenses over the loan term. Debt is classified as short term if it is payable within 12 months, otherwise it is classified as non-current. |
ACCOUNTING POLICIES | |||
All financial assets and liabilities are initially recognized at fair value, and subsequently classified either as financial assets at amortized cost or financial assets through profit or loss. | |||
Financial assets at amortized cost | |||
Financial assets are accounted at amortized cost only when the asset is held within a business model with the objective to collect contractual cash flows, which are solely payments of principal and interest. | |||
This category of financial assets includes trade and other receivables, cash and cash equivalents, lease receivables and other interest-bearing receivables. | |||
Financial assets in this category are carried at amortized cost in accordance with the effective interest method with interest income recognized in profit or loss under financial items, see note 20. | |||
Financial liabilities at amortized cost | |||
Financial liabilities in this category are initially recognized at fair value, net of transaction costs directly associated with the borrowing. For interest-bearing liabilities, after initial recognition, liabilities are measured using the effective interest rate method, taking into account any issue costs and any discount or premium on settlement. The related interest expenses are recognized in profit or | |||
Financial assets and liabilities at fair value through profit or loss | |||
Financial assets and liabilities in this category are recognized on the statement of financial position at their fair value with gains or losses resulting from changes in the fair value, being recognized in the income statement. | |||
This category consists mainly of derivatives. Gains or losses from the revaluation of derivative contracts that relate to financial items (loans, cash, leases) are presented as financing costs, see note 20, whereas gains or losses from derivatives, mainly currency forward contracts that relate to operating activities, are included in operating profit. | |||
Fair value measurement is also applicable to trade receivables sold under non-recourse agreements (for the sale of receivables), which have not yet been de-recognized from the statement of financial position at the reporting date. |
Other investments include unlisted shares, where the cost is considered to be a reasonable approximation of their fair value. | |||
Determination of fair values | |||
The classification of financial assets and liabilities measured at fair value in the statement of financial position is based on three hierarchy levels: \u2022 Level 1: quoted prices in active markets for given or identical assets or liabilities that the entity can access at the measurement date; \u2022 Level 2: inputs that are observable for the asset or liability, either directly or indirectly; \u2022 Level 3: unobservable inputs for the asset or liability. | |||
The carrying amount of all financial assets and liabilities, carried at amortized cost is considered to provide a reasonable approximation of their fair value, due to the short maturity and liquid nature of these items, except for bonds which are traded on an active market. | |||
The fair values of derivatives are determined based on prevailing marked quotes at the reporting date. The fair values of foreign exchange derivatives are calculated according to foreign exchange and interest rates on the closing date. |
ACCOUNTING POLICIES | |||
Dividends proposed by the Board of Directors are not deducted from distributable equity until approved by the Annual General Meeting of Shareholders. | |||
When the company's own shares are repurchased, the amount of the consideration paid, including directly attributable costs, is recognized as a deduction in equity. |
ACCOUNTING POLICIES | |||
Business combinations are accounted for using the acquisition method. Subsidiaries are consolidated from the date on which control is achieved until the date on which control ceases by using the acquisition method. The consideration transferred for the acquisition is the fair values of the assets transferred and the liabilities assumed. Acquisition related costs are recognised as expenses for the period in which they are incurred. | |||
Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The excess of the consideration transferred over the fair value of the identifiable net assets acquired is recognized as goodwill at the acquisition date. If the cost of the acquisition is less than the fair value of the net assets acquired in the case of a bargain purchase, the resulting gain is recognized in profit or loss. | |||
When a disposed operation is part of a cash-generating unit (CGU) to which goodwill has been allocated, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained. | |||
Assets held for sale | |||
Non-current assets are classified as held for sale if their carrying amounts are expected to be recovered principally through sale and the sale is highly probable. From the date of classification, the assets are measured at the lower of the carrying amount and the fair value less costs to sell, and the recognition of depreciation is discontinued. |
ACCOUNTING POLICIES | |||
Companies, where Tietoevry has assumed management responsibility, has contractually based joint control with a third party and has rights to the net assets of the company based on the contractual arrangement are included in the consolidated financial statements as joint ventures. Joint ventures are accounted by using the equity method under which the investments in joint ventures are initially recognized at cost and adjusted thereafter to recognize the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of joint venture\u2019s losses exceeds the carrying amount of the investment, the investment is recognized at zero value in the statement of financial position and the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the joint venture. | |||
Sales to and purchases from joint ventures are made on normal market terms and conditions and at market prices. The Group\u2019s share of the joint ventures\u2019 result for the period is separately disclosed in the income statement. |
ACCOUNTING POLICIES | |||
Sales to and purchases from related parties are made on normal market terms and conditions and at market prices. There are no commitments or contingencies on behalf of related parties. |
ACCOUNTING POLICIES | |||
Commitments are disclosed when the Group has a contract where the existence of an obligation will be only confirmed in the future. | |||
Contingent liabilities are possible obligations whose existence will be confirmed by uncertain future events that are not wholly within the control of the entity. They can also include obligations that are not recognized in the statement of financial position because settlement is not probable or their amount cannot be measured reliably. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
At each reporting date, management estimates the amount of probable future taxable profits against which unused tax losses can be utilized. As the actual profits may differ from the forecasts, the change will affect the taxes in future periods. | |||
The group operates globally and is, therefore subject to changing tax laws in multiple jurisdictions. The interpretation of tax legislation requires management judgement, and the applied interpretations may include uncertainties. |
ACCOUNTING POLICIES | |||
Intangible assets other than goodwill are recognized initially at cost. An intangible asset is recognized only if it is probable that the future economic benefits attributable to the asset will flow to the Group and the cost of the asset can be measured reliably. All other costs are expensed as incurred. | |||
After initial recognition, intangible assets are measured at cost less amortization and accumulated impairment losses. Intangible assets are amortized over their useful lives with the straight-line method. Assets that are subject to amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Internally developed software | |||
Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development projects are analysed individually to determine the moment when the project has reached a milestone after which capitalization of development costs can start. Only costs which are directly attributable to the development are capitalised. |
Subsequent to initial recognition, these costs are measured at cost less accumulated amortization and impairment losses. The amortization period for internally developed software depends on the technology renewal cycle and contract duration. Internally developed software for which amortization has not yet started is tested for impairment on an annual basis by comparing the asset's carrying amount with its recoverable amount. If the carrying amount exceeds the recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Intangible assets recognised from acquisitions | |||
Intangible assets acquired in business combinations are measured at fair value at the acquisition date. These are usually customer or technology related and have finite useful lives. | |||
Gains and losses on disposal of intangible assets are included in other operating income and expenses. | |||
The Group applies the following useful lives: |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
Estimates are made when determining the fair values of assets acquired in a business combination. The valuation requires management to determine the appropriate valuation technique and inputs for fair value measurements, such as discount rate. | |||
Determining whether goodwill is impaired requires an estimation of the value-in-use of the cash- generating units (CGU) to which goodwill has been allocated. The value-in-use calculation requires management to estimate the future cash flows expected to arise from the CGUs and an appropriate discount rate to calculate present value. | |||
While management believes that the estimates and assumptions used are reasonable, there are uncertainties which could materially affect the valuations. |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Acquisitions of subsidiaries | 137.4 | 0.1 | 22.6 | \u2014 | \u2014 | \u2014 | 160.1 |
Additions | \u2014 | 6.9 | \u2014 | 44.7 | 0.0 | 0.6 | 52.1 |
Disposals | \u2014 | -8.5 | -17.3 | -5.5 | -9.9 | \u2014 | -41.3 |
Reclassifications | \u2014 | 2.3 | \u2014 | \u2014 | 0.7 | -2.6 | 0.4 |
Translation differences | -76.6 | -0.3 | -14.7 | -16.6 | -0.1 | -0.1 | -108.4 |
Acquisition cost 31\u00a0Dec 2023 | 1\u00a0907.3 | 29.9 | 282.0 | 330.8 | 19.9 | 1.2 | 2\u00a0571.1 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02023 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Disposals | \u2014 | 8.5 | 17.3 | 5.5 | 9.9 | \u2014 | 41.3 |
Amortization | \u2014 | -4.7 | -41.8 | -6.3 | -1.1 | \u2014 | -53.9 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.0 | \u2014 | -0.4 |
Translation differences | \u2014 | 0.4 | 6.8 | 6.4 | 0.1 | \u2014 | 13.6 |
Accumulated amortization and impairments 31\u00a0Dec 2023 | \u2014 | -18.7 | -171.5 | -117.0 | -17.2 | 0.0 | -324.3 |
Carrying value 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
Carrying value 31\u00a0Dec 2023 | 1\u00a0907.3 | 11.2 | 110.6 | 213.9 | 2.8 | 1.2 | 2\u00a0246.8 |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 49.6 | 308.6 | 285.3 | 38.2 | 3.5 | 2\u00a0628.9 |
Additions | \u2014 | 2.7 | \u2014 | 37.2 | 0.9 | 2.7 | 43.5 |
Disposals | \u2014 | -25.2 | \u2014 | \u2014 | -9.7 | -0.7 | -35.7 |
Reclassifications | \u2014 | 3.6 | \u2014 | -1.9 | 0.1 | -2.2 | -0.5 |
Translation differences | -97.1 | -1.1 | -17.3 | -12.2 | -0.1 | -0.0 | -128.0 |
Acquisition cost 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02022 | \u2014 | -42.5 | -115.4 | -103.3 | -35.3 | -0.7 | -297.3 |
Disposals | \u2014 | 25.2 | \u2014 | \u2014 | 9.7 | 0.7 | 35.7 |
Amortization | \u2014 | -6.0 | -46.7 | -4.8 | -0.9 | \u2014 | -58.5 |
Impairments | \u2014 | \u2014 | \u2014 | -18.7 | \u2014 | \u2014 | -18.7 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.3 | \u2014 | 0.0 |
Translation differences | \u2014 | 1.0 | 8.5 | 4.3 | 0.1 | \u2014 | 13.9 |
Accumulated amortization and impairments 31\u00a0Dec\u00a02022 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Carrying value 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 7.1 | 193.2 | 182.0 | 2.8 | 2.8 | 2\u00a0331.6 |
Carrying value 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Tietoevry Create | 697.7 | 575.5 |
Tietoevry Banking | 308.7 | 325.9 |
Tietoevry Care | 260.9 | 273.5 |
Tietoevry Industry | 188.4 | 197.5 |
Tietoevry Tech Services | 451.6 | 474.0 |
Total | 1\u00a0907.3 | 1\u00a0846.5 |
2023 | Five-year period 2024\u20132028 | |
Terminal growth rate % | Pre-tax WACC % | |
Tietoevry Create | 2.0 | 11.6 |
Tietoevry Banking | 2.0 | 9.1 |
Tietoevry Care | 2.0 | 8.8 |
Tietoevry Industry | 2.0 | 8.9 |
Tietoevry Tech Services | 2.0 | 8.9 |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
Provisions require management to assess the best estimate of the future costs needed to settle the present obligation at the reporting date. The actual costs may differ from the estimated costs. |
ACCOUNTING POLICIES | |||
The operating segments are reported in a manner consistent with the internal reporting provided to the Group Executive Management, which has been identified as Tietoevry\u2019s chief operating decision maker being responsible for allocating resources and assessing performance of the operating segments as well as deciding on strategy. | |||
The Group Executive Management assesses the profitability of segments principally on the basis of adjusted operating profit (EBITA). Operating profit (EBIT) is, however, also an essential measure and is disclosed in this segment note as it is most consistent with the result reported in accordance with IFRS. Transactions between the segments are made on a market-terms basis. | |||
Eliminations include internal revenue between operating segments and Group function sales of internal services to the business. Non-allocated costs relate to Global management and Support functions and are shown separately in the operating profit (EBIT). |
EUR million | 2023 | 2022 | Change % |
Tietoevry Create | 851.2 | 849.0 | 0 |
Tietoevry Banking | 567.2 | 571.1 | -1 |
Tietoevry Care | 236.5 | 231.4 | 2 |
Tietoevry Industry | 262.6 | 272.6 | -4 |
Tietoevry Tech Services | 1\u00a0074.7 | 1\u00a0171.4 | -8 |
Eliminations | -140.7 | -167.4 | -16 |
Group total | 2\u00a0851.4 | 2\u00a0928.1 | -3 |
EUR million | 2023 | 2022 | Change % |
Tietoevry Create | 94.9 | 91.2 | 4 |
Tietoevry Banking | 42.9 | 49.1 | -13 |
Tietoevry Care | 68.9 | 72.2 | -5 |
Tietoevry Industry | 36.9 | 51.9 | -29 |
Tietoevry Tech Services | 51.9 | 42.3 | 23 |
Non-allocated costs | -39.8 | -40.2 | -1 |
Group total | 255.6 | 266.5 | -4 |
% | 2023 | 2022 | Change pp |
Tietoevry Create | 11.1 | 10.7 | 0 |
Tietoevry Banking | 7.6 | 8.6 | -1 |
Tietoevry Care | 29.1 | 31.2 | -2 |
Tietoevry Industry | 14.0 | 19.0 | -5 |
Tietoevry Tech Services | 4.8 | 3.6 | 1 |
Operating margin (EBIT) | 9.0 | 9.1 | 0 |
EUR million | 2023 | 2022 |
Tietoevry Create | 23.7 | 18.3 |
Tietoevry Banking | 19.9 | 21.8 |
Tietoevry Care | 3.0 | 3.5 |
Tietoevry Industry | 2.6 | 2.5 |
Tietoevry Tech Services | 25.0 | 15.6 |
Group total | 74.2 | 61.6 |
EUR million | 2023 | 2022 | Change % |
Finland | 644.2 | 640.2 | 1 |
Sweden | 901.3 | 947.3 | -5 |
Norway | 948.6 | 1\u00a0016.7 | -7 |
Other | 357.2 | 323.9 | 10 |
Group total | 2\u00a0851.4 | 2\u00a0928.1 | -3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Change % |
Finland | 110.9 | 119.0 | -7 |
Sweden | 110.7 | 120.1 | -8 |
Norway | 331.4 | 368.4 | -10 |
Other | 71.3 | 28.3 | > 100 |
Group total | 624.3 | 635.8 | -2 |
End of period | Average | |||||
2023 | 2022 | Change % | Share % | 2023 | 2022 | |
Tietoevry Create | 9\u00a0618 | 8\u00a0989 | 7 | 40 | 9\u00a0248 | 8\u00a0871 |
Tietoevry Banking | 3\u00a0509 | 3\u00a0454 | 2 | 15 | 3\u00a0518 | 3\u00a0500 |
Tietoevry Care | 1\u00a0557 | 1\u00a0480 | 5 | 6 | 1\u00a0539 | 1\u00a0425 |
Tietoevry Industry | 1\u00a0644 | 1\u00a0682 | -2 | 7 | 1\u00a0666 | 1\u00a0703 |
Tietoevry Tech Services | 7\u00a0255 | 8\u00a0036 | -10 | 30 | 7\u00a0621 | 8\u00a0214 |
Group functions | 576 | 678 | -15 | 2 | 589 | 689 |
Group total | 24\u00a0159 | 24\u00a0320 | -1 | 100 | 24\u00a0181 | 24\u00a0401 |
End of period | Average | |||||
2023 | 2022 | Change % | Share % | 2023 | 2022 | |
Sweden | 3\u00a0856 | 4\u00a0029 | -4 | 16 | 3\u00a0980 | 4\u00a0097 |
Norway | 3\u00a0922 | 3\u00a0990 | -2 | 16 | 3\u00a0951 | 4\u00a0102 |
Finland | 3\u00a0015 | 3\u00a0134 | -4 | 12 | 3\u00a0101 | 3\u00a0151 |
India | 4\u00a0308 | 4\u00a0499 | -4 | 18 | 4\u00a0390 | 4\u00a0601 |
Czech Republic | 2\u00a0381 | 2\u00a0694 | -12 | 10 | 2\u00a0497 | 2\u00a0631 |
Ukraine | 1\u00a0728 | 2\u00a0037 | -15 | 7 | 1\u00a0835 | 2\u00a0135 |
Latvia | 1\u00a0070 | 1\u00a0072 | 0 | 4 | 1\u00a0091 | 1\u00a0041 |
China | 1\u00a0044 | 1\u00a0066 | -2 | 4 | 1\u00a0053 | 978 |
Poland | 839 | 776 | 8 | 3 | 833 | 720 |
Bulgaria | 780 | 32 | > 100 | 3 | 350 | 18 |
Other | 1\u00a0217 | 991 | 23 | 5 | 1\u00a0100 | 929 |
Group total | 24\u00a0159 | 24\u00a0320 | -1 | 100 | 24\u00a0181 | 24\u00a0401 |
Onshore countries | 11\u00a0370 | 11\u00a0687 | -3 | 47 | 11\u00a0586 | 11\u00a0869 |
Offshore countries | 12\u00a0789 | 12\u00a0633 | 1 | 53 | 12\u00a0595 | 12\u00a0533 |
Group total | 24\u00a0159 | 24\u00a0320 | -1 | 100 | 24\u00a0181 | 24\u00a0401 |
EUR million | 2023 | 2022 | Change % |
Tietoevry Create | 6.6 | 6.7 | -1 |
Tietoevry Banking | 4.8 | 4.8 | 2 |
Tietoevry Care | 1.0 | 0.9 | 8 |
Tietoevry Industry | 0.7 | 0.6 | 16 |
Tietoevry Tech Services | 44.6 | 42.4 | 5 |
Group functions | 40.8 | 48.4 | -16 |
Group total | 98.5 | 103.8 | -5 |
EUR million | 2023 | 2022 | Change % |
Tietoevry Create | 0.1 | 0.1 | -42 |
Tietoevry Banking | 3.6 | 2.8 | 30 |
Tietoevry Care | 2.5 | 1.6 | 50 |
Tietoevry Industry | 0.2 | 0.3 | -14 |
Tietoevry Tech Services | 5.4 | 6.5 | -18 |
Group functions | 0.3 | 0.4 | -26 |
Group total | 12.0 | 11.7 | 3 |
EUR million | 2023 | 2022 | Change % |
Tietoevry Create | 10.0 | 10.1 | -1 |
Tietoevry Banking | 19.3 | 21.6 | -11 |
Tietoevry Care | 0.2 | 0.2 | -7 |
Tietoevry Industry | 4.7 | 6.2 | -24 |
Tietoevry Tech Services | 7.7 | 8.7 | -11 |
Group functions | \u2014 | \u2014 | \u2014 |
Group total | 41.8 | 46.7 | -10 |
ACCOUNTING POLICIES | |||
The operating segments are reported in a manner consistent with the internal reporting provided to the Group Executive Management, which has been identified as Tietoevry\u2019s chief operating decision maker being responsible for allocating resources and assessing performance of the operating segments as well as deciding on strategy. | |||
The Group Executive Management assesses the profitability of segments principally on the basis of adjusted operating profit (EBITA). Operating profit (EBIT) is, however, also an essential measure and is disclosed in this segment note as it is most consistent with the result reported in accordance with IFRS. Transactions between the segments are made on a market-terms basis. | |||
Eliminations include internal revenue between operating segments and Group function sales of internal services to the business. Non-allocated costs relate to Global management and Support functions and are shown separately in the operating profit (EBIT). |
ACCOUNTING POLICIES | |||
Revenue is measured based on the consideration to which the Group expects to be entitled in a contract with a customer and excludes consideration collected on behalf of third parties. The Group recognizes revenue when it transfers control of a good or service to a customer. | |||
The Group typically provides customers with a variety of comprehensive services. The individual service delivery contracts are often structured under a common frame contract where general terms for the service delivery to the customer are defined. The content of the delivery, performance obligations and pricing, are defined in the service delivery contracts. Management judgement is used to determine the basis for the revenue recognition; either an individual service delivery contract or a group of combined contracts. | |||
Revenue from service contracts is based on service volumes or time and materials and the performance obligations are recognized over the accounting period in which the services are rendered or project is delivered. The services are generally satisfied and the control transferred to the customer over time given that either the customer simultaneously receives and consumes the benefits provided by the Group, or the Group\u2019s performance does not create an asset with an alternative use for the Group, in which case there is an enforceable right to payment for work completed to date. |
In the majority of the businesses providing continuous services, time and material projects and consulting, the performance obligations satisfied are invoiced on a monthly basis. At the time of invoicing, a receivable is recognized by the Group as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due. The standard payment term is 30 days according to the Group\u2019s Credit Policy. | |||
Goods, typically distinct licenses, that provide a right to use the software, are invoiced on delivery. The license revenue is recognized at a point in time when the license is delivered, the legal title has passed, the customer has accepted the license and has access to the licensed software. Distinct licenses, that provide a right to access the software, are recognized over the contract period. Contract assets or liabilities do not typically arise in the businesses described above. | |||
For contracts comprising fixed-price projects, revenue is recognized based on the actual service provided by the reporting date as a proportion of the total services to be provided. This is determined based on the cost of actual labour hours spent relative to the total expected cost of labour hours, as it best reflects the transfer of control to the customer. Estimates of revenues, costs or progress towards completion are revised if circumstances change and any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management. Invoicing and customer payments in the fixed-price projects follow the payment schedule defined in the customer contract. If the services rendered by the Group exceed the payment, a contract asset is recognized, and if the payments exceed the services rendered, a contract liability is recognized. | |||
The customer contracts of the Group typically comprise several of the business models described above. The most appropriate presentation on how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors is considered to be the disaggregation of sales from long-term fixed-price contracts by segment represents the revenue from contracts for which the risks are different compared to other contracts with customers. | |||
Some contracts include delivery of hardware together with a variety of services from the Group. Hardware is usually provided by another service provider. The installation of hardware is simple, does not include an integration service from the Group and could be performed by another party. It is, therefore, accounted for as a separate performance obligation. In these contracts, Tietoevry acts as an agent, if the Group does not obtain control of the hardware provided by another party before it is transferred to the customer, or as a principal if control is obtained. |
Where the contracts include multiple performance obligations, the transaction price is allocated to each performance obligation based on the stand-alone selling prices, which are observable from the contracts and represent prices for services rendered in similar circumstances to similar customers. Revenue from contracts granting a discount retrospectively to the customer is recognized based on the price specified in the contract, net of the estimated discounts. Discounts are estimated based on management's experience of the earlier purchases of the customers under similar contracts. This estimation is regularly updated during the contract period. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. | |||
In settlement agreement cases, consideration paid to customers is reduced from revenue when a settlement agreement is signed with the customer. Consideration received from customers is recognized as revenue or other operating income depending on the facts and circumstances. | |||
The Group grants assurance type of warranties which guarantee that the delivery complies with agreed specifications. These are accounted for in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. | |||
The Group does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. Consequently, the Group does not adjust any of the transaction prices for the time value of money. | |||
The Group capitalizes material costs of set-up activities related to transition or implementation projects in the initial phase of continuous operating service contracts, when the criteria for capitalization according to IFRS 15 are met. Management judgement has been used when developing internal guidance on the tasks defined as set-up activities in the Group. The set-up activities do not result in the transfer of a promised good or service and are not identified as a performance obligation to the customer. The capitalized costs of a contract are amortized during the period when the revenue for the related continuous operating service contract is recognized. |
EUR million | 2023 | 2022 |
Capitalized set-up costs on 31 Dec | 5.8 | 11.8 |
Amortization of capitalized set-up costs | 6.6 | 8.4 |
ACCOUNTING POLICIES | |||
Revenue is measured based on the consideration to which the Group expects to be entitled in a contract with a customer and excludes consideration collected on behalf of third parties. The Group recognizes revenue when it transfers control of a good or service to a customer. | |||
The Group typically provides customers with a variety of comprehensive services. The individual service delivery contracts are often structured under a common frame contract where general terms for the service delivery to the customer are defined. The content of the delivery, performance obligations and pricing, are defined in the service delivery contracts. Management judgement is used to determine the basis for the revenue recognition; either an individual service delivery contract or a group of combined contracts. | |||
Revenue from service contracts is based on service volumes or time and materials and the performance obligations are recognized over the accounting period in which the services are rendered or project is delivered. The services are generally satisfied and the control transferred to the customer over time given that either the customer simultaneously receives and consumes the benefits provided by the Group, or the Group\u2019s performance does not create an asset with an alternative use for the Group, in which case there is an enforceable right to payment for work completed to date. |
In the majority of the businesses providing continuous services, time and material projects and consulting, the performance obligations satisfied are invoiced on a monthly basis. At the time of invoicing, a receivable is recognized by the Group as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due. The standard payment term is 30 days according to the Group\u2019s Credit Policy. | |||
Goods, typically distinct licenses, that provide a right to use the software, are invoiced on delivery. The license revenue is recognized at a point in time when the license is delivered, the legal title has passed, the customer has accepted the license and has access to the licensed software. Distinct licenses, that provide a right to access the software, are recognized over the contract period. Contract assets or liabilities do not typically arise in the businesses described above. | |||
For contracts comprising fixed-price projects, revenue is recognized based on the actual service provided by the reporting date as a proportion of the total services to be provided. This is determined based on the cost of actual labour hours spent relative to the total expected cost of labour hours, as it best reflects the transfer of control to the customer. Estimates of revenues, costs or progress towards completion are revised if circumstances change and any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period in which the circumstances that give rise to the revision become known by management. Invoicing and customer payments in the fixed-price projects follow the payment schedule defined in the customer contract. If the services rendered by the Group exceed the payment, a contract asset is recognized, and if the payments exceed the services rendered, a contract liability is recognized. | |||
The customer contracts of the Group typically comprise several of the business models described above. The most appropriate presentation on how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors is considered to be the disaggregation of sales from long-term fixed-price contracts by segment represents the revenue from contracts for which the risks are different compared to other contracts with customers. | |||
Some contracts include delivery of hardware together with a variety of services from the Group. Hardware is usually provided by another service provider. The installation of hardware is simple, does not include an integration service from the Group and could be performed by another party. It is, therefore, accounted for as a separate performance obligation. In these contracts, Tietoevry acts as an agent, if the Group does not obtain control of the hardware provided by another party before it is transferred to the customer, or as a principal if control is obtained. |
Where the contracts include multiple performance obligations, the transaction price is allocated to each performance obligation based on the stand-alone selling prices, which are observable from the contracts and represent prices for services rendered in similar circumstances to similar customers. Revenue from contracts granting a discount retrospectively to the customer is recognized based on the price specified in the contract, net of the estimated discounts. Discounts are estimated based on management's experience of the earlier purchases of the customers under similar contracts. This estimation is regularly updated during the contract period. Revenue is only recognized to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. | |||
In settlement agreement cases, consideration paid to customers is reduced from revenue when a settlement agreement is signed with the customer. Consideration received from customers is recognized as revenue or other operating income depending on the facts and circumstances. | |||
The Group grants assurance type of warranties which guarantee that the delivery complies with agreed specifications. These are accounted for in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. | |||
The Group does not have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. Consequently, the Group does not adjust any of the transaction prices for the time value of money. | |||
The Group capitalizes material costs of set-up activities related to transition or implementation projects in the initial phase of continuous operating service contracts, when the criteria for capitalization according to IFRS 15 are met. Management judgement has been used when developing internal guidance on the tasks defined as set-up activities in the Group. The set-up activities do not result in the transfer of a promised good or service and are not identified as a performance obligation to the customer. The capitalized costs of a contract are amortized during the period when the revenue for the related continuous operating service contract is recognized. |
ACCOUNTING POLICIES | |||
Government grants | |||
Government grants are recognized as other operating income on a systematic basis over the periods necessary to match them with the related costs that they are intended to compensate. | |||
Research and development costs | |||
Research costs are expensed when incurred. Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development costs comprise service and solution development focusing on, for example, industry-specific software, customer experience management and security services, as well as cloud services. Additionally, the costs for related internal development e.g. automation in infrastructure services, are included in development costs. |
EUR million | 2023 | 2022 |
Gain on sale of property, plant and equipment, and business operations | 7.1 | 1.4 |
Change in fair value of derivatives | 7.2 | 9.2 |
Government grants | 2.5 | 3.4 |
Joint venture management fees | 0.6 | 1.3 |
Other | 4.9 | 34.8 |
Total | 22.2 | 50.2 |
EUR million | 2023 | 2022 |
Information and communication technology1) | 193.7 | 207.1 |
Premises related costs | 44.6 | 51.3 |
Professional services and marketing | 43.4 | 43.0 |
Other operating expenses | 47.2 | 61.1 |
Total | 328.9 | 362.6 |
EUR million | 2023 | 2022 |
Audit fees | 1.6 | 1.3 |
Audit related | 0.3 | 0.1 |
Tax advisory | 0.0 | 0.1 |
Other services | 0.3 | 0.4 |
Total | 2.1 | 1.9 |
EUR million | 2023 | 2022 |
Gain on sale of property, plant and equipment, and business operations | 7.1 | 1.4 |
Change in fair value of derivatives | 7.2 | 9.2 |
Government grants | 2.5 | 3.4 |
Joint venture management fees | 0.6 | 1.3 |
Other | 4.9 | 34.8 |
Total | 22.2 | 50.2 |
EUR million | 2023 | 2022 |
Information and communication technology1) | 193.7 | 207.1 |
Premises related costs | 44.6 | 51.3 |
Professional services and marketing | 43.4 | 43.0 |
Other operating expenses | 47.2 | 61.1 |
Total | 328.9 | 362.6 |
EUR million | 2023 | 2022 |
Audit fees | 1.6 | 1.3 |
Audit related | 0.3 | 0.1 |
Tax advisory | 0.0 | 0.1 |
Other services | 0.3 | 0.4 |
Total | 2.1 | 1.9 |
ACCOUNTING POLICIES | |||
Employee benefits are recognised in the period in which services are rendered by the employees. Termination benefits are recognised at the time an agreement between the Group and the employee is made and no future service is rendered by the employee in exchange for the benefits. | |||
Share-based incentive plans | |||
Tietoevry has share-based incentive plans for its key employees which are accounted for as equity- settled. The plans are valued at fair value based on the market price of Tietoevry shares at the grant date and recognized as an employee benefit expense during the vesting period with a corresponding entry in equity. At each reporting date, the number of shares that are expected to vest from the Group\u2019s share-based incentive plans is revised. As part of this evaluation, the changes in the forecasted performance of the Group, the expected turnover of the personnel participating in the plans and other information impacting the number of shares to vest, is taken into consideration. Any adjustments to the initial estimates are recognized in profit or loss and a corresponding adjustment is made to equity. In countries where the reward is intended to be paid fully in cash, the costs are accounted for as cash-settled. Social costs paid on top of the reward are accounted for as cash- settled. |
EUR million | 2023 | 2022 |
Wages and salaries1) | 1\u00a0219.3 | 1\u00a0247.9 |
Post-employment benefits | ||
Defined contribution plans | 92.4 | 100.1 |
Defined benefit plans | 2.2 | -2.1 |
Other benefits | 23.8 | 23.8 |
Other pay-related statutory social costs | 218.2 | 219.1 |
Share-based payments | 8.7 | 7.5 |
Other personnel expenses | 1.4 | 0.8 |
Total | 1\u00a0566.0 | 1\u00a0597.2 |
2023 | 2022 | |||
EUR thousand | President and CEO | Leadership team | President and CEO | Leadership team2) |
Salaries and benefits | 875.0 | 3\u00a0339.4 | 853.5 | 3\u00a0082.3 |
Bonuses1) | 642.3 | 1\u00a0088.7 | 991.6 | 1\u00a0273.6 |
Share-based payments | 1\u00a0105.6 | 2\u00a0415.3 | 514.4 | 906.2 |
Statutory pensions | 214.8 | 460.2 | 136.5 | 415.8 |
Supplementary pensions | 213.3 | 458.7 | 205.1 | 323.5 |
Total | 3\u00a0051.0 | 7\u00a0762.3 | 2\u00a0701.1 | 6\u00a0001.4 |
EUR thousand | 2023 | 2022 |
Board members at 31\u00a0Dec 2023 | ||
Tomas Franz\u00e9n, Chairperson Board and RC | 173.0 | 169.3 |
Harri-Pekka Kaukonen, Deputy Chairperson, Chairperson ARC | 106.4 | 102.9 |
Bertil Carls\u00e9n1) | 75.7 | \u2014 |
Elisabetta Castiglioni1) | 74.9 | \u2014 |
Liselotte H\u00e4gertz Engstam | 77.3 | 79.7 |
Katharina Mosheim | 77.3 | 78.9 |
Gustav Moss1) | 81.3 | \u2014 |
Endre Rangnes | 82.9 | 78.1 |
Petter S\u00f6derstr\u00f6m1) | 81.3 | \u2014 |
Timo Ahopelto, Deputy Chairperson2) | 2.4 | 99.6 |
Niko Pakal\u00e9n2) | 3.2 | 86.1 |
Angela Mazza Teufer2) | 0.8 | 64.1 |
Leif Teksum3) | \u2014 | 2.4 |
Tommy Sander Aldrin, personnel rep.1) | 15.0 | \u2014 |
Anders Palklint, personnel rep.1) | 15.0 | \u2014 |
Thomas Slettemoen, personnel deputy rep.1) | 7.5 | \u2014 |
Ilpo Waljus, personnel deputy rep.1) | 7.5 | 15.0 |
Robert Spinelli, personnel rep.2) | \u2014 | 15.0 |
Sigve Sandvik L\u00e6rdal, personnel deputy rep.2) | \u2014 | \u2014 |
Total | 881.5 | 791.1 |
Performance Share Plan | |||
2021\u20132023 | 2022\u20132024 | 2023-2025 | |
Plan launched | 16 February 2021 | 16 February 2022 | 14 February 2023 |
Performance period | 2021\u20132023 | 2022\u20132024 | 2023\u20132025 |
Vesting conditions | Relative Total Shareholder Return of Tietoevry share (TSR), strategic target related to Tietoevry's growth and Tietoevry's Earnings per Share (EPS). Valid employment or director agreement of a key employee upon the reward payment. | Relative and absolute Total Shareholder Return of Tietoevry share (TSR), Revenue growth and ESG target. Valid employment or director agreement of a key employee upon the reward payment. | Relative Total Shareholder Return of Tietoevry share (TSR) and ESG targets (gender diversity and CO2 reduction). Valid employment or director agreement of a key employee upon the reward payment. |
Exercised | In shares and cash in 2024 | In shares and cash in 2025 | In shares and cash in 2026 |
Number of participants on 31\u00a0Dec\u00a02023 | 81 | 464 | 512 |
Other | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 375 130 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 845 818 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 890 740 Tietoevry gross shares. |
Restricted Share Plan | |||
2021\u20132023 | 2022\u20132024 | 2023-2025 | |
Plan launched | 16 February 2021 | 16 February 2022 | 14 February 2023 |
Vesting period | 2021\u20132023 | 2022\u20132024 | 2023\u20132025 |
Vesting conditions | Valid employment or director agreement of a key employee upon the reward payment. | ||
Exercised | In shares and cash in 2024 | In shares and cash in 2025 | In shares and cash in 2026 |
Number of participants on 31\u00a0Dec\u00a02023 | 373 | 142 | 152 |
Other | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 189 763 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 57 235 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 52 598 Tietoevry gross shares. |
EUR million | 2023 | 2022 |
Equity-settled share-based incentive plans | 9.5 | 6.9 |
Cash-settled share-based incentive plans | 0.1 | 0.0 |
Social costs settled in cash1) | 0.9 | 1.3 |
Total | 10.5 | 8.2 |
ACCOUNTING POLICIES | |||
The fixed contributions to defined contribution plans are recognized as employee benefit expenses in the period to which they relate. The Group has no further legal or constructive payment obligations once the contributions have been paid. | |||
Defined benefit plans typically define an amount of post-employment benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. Defined benefit plans are funded with payments to insurance companies. | |||
For defined benefit plans, the net liability recognized in the statement of financial position equals the present value of the defined benefit obligation at the closing date less the fair value of the plan assets. The present value of the defined benefit obligation is determined separately for each plan by independent actuaries using the projected unit credit method. The actuarial calculations include several financial and demographic assumptions and any change in these will impact the carrying amount and future expense of the defined benefit obligation. | |||
Current service costs, past service costs and gains or losses on settlements are recognized in employee benefit expenses. Net interest expense or income is recognized in financial items under interest expense or interest income. All remeasurements of the defined benefit liability or asset arising from experience adjustments and changes in actuarial assumptions are recognized directly in other comprehensive income. |
EUR million | 2023 | 2022 |
Service cost | ||
Current service cost | 2.1 | 2.7 |
Settlement gains / losses | 0.1 | -6.9 |
Conversion costs | \u2014 | 2.1 |
Net interest | -0.3 | -0.2 |
Total | 1.9 | -2.3 |
Amounts recognized in other comprehensive income | ||
Remeasurement | ||
Gains (-)/losses (+) from change in demographic assumptions | 0.0 | 0.0 |
Gains (-)/losses (+) from change in financial assumptions | -1.0 | -4.5 |
Gains (-)/losses (+) from experience adjustments | -0.2 | -0.5 |
Gains (-)/losses (+) on plan assets | 0.5 | 3.0 |
Total | -0.6 | -2.0 |
Present value of defined benefit obligaton1) | Fair value of plan assets2) | Net liability | ||||
EUR million | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
1 Jan | 32.9 | 74.2 | -5.2 | -36.4 | 27.8 | 38.0 |
Current service cost | 2.1 | 2.7 | \u2014 | \u2014 | 2.1 | 2.7 |
Interest expense/income | 0.5 | 0.5 | -0.2 | -0.2 | 0.3 | 0.2 |
Employer contribution3) | \u2014 | \u2014 | -0.9 | -1.1 | -0.9 | -1.1 |
Benefits paid3) | -1.7 | -2.4 | 0.1 | 0.5 | -1.6 | -1.8 |
Curtailment and settlement | -0.1 | -35.2 | 0.1 | 28.4 | 0.1 | -6.9 |
Actuarial gains/losses | -1.2 | -5.1 | 0.6 | 3.1 | -0.6 | -2.0 |
Businesses acquired/divested | \u2014 | 0.2 | \u2014 | -0.1 | \u2014 | 0.1 |
Exchange rate differences | -1.5 | -1.9 | 0.0 | 0.6 | -1.5 | -1.4 |
31 Dec | 30.9 | 33.0 | -5.4 | -5.2 | 25.5 | 27.8 |
EUR million | 2023 | 2022 |
Defined benefit obligations | 26.5 | 28.4 |
Defined benefit plan assets | -1.0 | -0.6 |
Net liability | 25.5 | 27.8 |
% | 2023 | 2022 |
Finland | ||
Discount rate | 3.7 | 3.1 |
Future salary increases | \u2014 | 4.3 |
Future pension increases | 2.6 | 2.8 |
Inflation rate | 2.4 | 2.6 |
Sweden | ||
Discount rate | 3.9 | 3.7 |
Future salary increases | 1.6 | 2.0 |
Future pension increases | 1.6 | 2.0 |
Inflation rate | 1.6 | 2.0 |
Norway | ||
Discount rate | 3.1 | 3.0 |
Future salary increases | 3.5 | 3.5 |
Growth in the basic state pension (G) | 3.3 | 3.3 |
Change in assumption | Increase in assumption | Decrease in assumption | |
Impact on defined benefit obligation in Finland | |||
Discount rate | 0.5% | -6.7% | 7.5% |
Future pension increase | 0.5% | 7.0% | -6.4% |
Life expectancy | +1 year | 4.6% | |
Impact on defined benefit obligation in Sweden | |||
Discount rate | 0.5% | -7.7% | 8.6% |
Future salary increase | 0.5% | 9.4% | -8.6% |
Future pension increase | 0.5% | 6.3% | -6.0% |
Life expectancy | +1 year | 2.9% | |
Impact on defined benefit obligation in Norway | |||
Discount rate | 0.5% | -1.1% | 1.2% |
Future salary increase | 0.5% | 0.2% | -0.1% |
Future pension increase | 0.5% | 0.9% | \u2014% |
Life expectancy | +1 year | 1.0% |
EUR million | 2023 |
Maturity under 1 year | 2.0 |
Maturity 1\u20135 years | 8.0 |
Maturity 5\u201310 years | 10.7 |
Maturity 10\u201330 years | 24.6 |
Maturity over 30 years | 2.2 |
Total future benefit payments | 47.7 |
ACCOUNTING POLICIES | |||
Employee benefits are recognised in the period in which services are rendered by the employees. Termination benefits are recognised at the time an agreement between the Group and the employee is made and no future service is rendered by the employee in exchange for the benefits. | |||
Share-based incentive plans | |||
Tietoevry has share-based incentive plans for its key employees which are accounted for as equity- settled. The plans are valued at fair value based on the market price of Tietoevry shares at the grant date and recognized as an employee benefit expense during the vesting period with a corresponding entry in equity. At each reporting date, the number of shares that are expected to vest from the Group\u2019s share-based incentive plans is revised. As part of this evaluation, the changes in the forecasted performance of the Group, the expected turnover of the personnel participating in the plans and other information impacting the number of shares to vest, is taken into consideration. Any adjustments to the initial estimates are recognized in profit or loss and a corresponding adjustment is made to equity. In countries where the reward is intended to be paid fully in cash, the costs are accounted for as cash-settled. Social costs paid on top of the reward are accounted for as cash- settled. |
ACCOUNTING POLICIES | |||
The fixed contributions to defined contribution plans are recognized as employee benefit expenses in the period to which they relate. The Group has no further legal or constructive payment obligations once the contributions have been paid. | |||
Defined benefit plans typically define an amount of post-employment benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. Defined benefit plans are funded with payments to insurance companies. | |||
For defined benefit plans, the net liability recognized in the statement of financial position equals the present value of the defined benefit obligation at the closing date less the fair value of the plan assets. The present value of the defined benefit obligation is determined separately for each plan by independent actuaries using the projected unit credit method. The actuarial calculations include several financial and demographic assumptions and any change in these will impact the carrying amount and future expense of the defined benefit obligation. | |||
Current service costs, past service costs and gains or losses on settlements are recognized in employee benefit expenses. Net interest expense or income is recognized in financial items under interest expense or interest income. All remeasurements of the defined benefit liability or asset arising from experience adjustments and changes in actuarial assumptions are recognized directly in other comprehensive income. |
Performance Share Plan | |||
2021\u20132023 | 2022\u20132024 | 2023-2025 | |
Plan launched | 16 February 2021 | 16 February 2022 | 14 February 2023 |
Performance period | 2021\u20132023 | 2022\u20132024 | 2023\u20132025 |
Vesting conditions | Relative Total Shareholder Return of Tietoevry share (TSR), strategic target related to Tietoevry's growth and Tietoevry's Earnings per Share (EPS). Valid employment or director agreement of a key employee upon the reward payment. | Relative and absolute Total Shareholder Return of Tietoevry share (TSR), Revenue growth and ESG target. Valid employment or director agreement of a key employee upon the reward payment. | Relative Total Shareholder Return of Tietoevry share (TSR) and ESG targets (gender diversity and CO2 reduction). Valid employment or director agreement of a key employee upon the reward payment. |
Exercised | In shares and cash in 2024 | In shares and cash in 2025 | In shares and cash in 2026 |
Number of participants on 31\u00a0Dec\u00a02023 | 81 | 464 | 512 |
Other | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 375 130 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 845 818 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 890 740 Tietoevry gross shares. |
Restricted Share Plan | |||
2021\u20132023 | 2022\u20132024 | 2023-2025 | |
Plan launched | 16 February 2021 | 16 February 2022 | 14 February 2023 |
Vesting period | 2021\u20132023 | 2022\u20132024 | 2023\u20132025 |
Vesting conditions | Valid employment or director agreement of a key employee upon the reward payment. | ||
Exercised | In shares and cash in 2024 | In shares and cash in 2025 | In shares and cash in 2026 |
Number of participants on 31\u00a0Dec\u00a02023 | 373 | 142 | 152 |
Other | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 189 763 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 57 235 Tietoevry gross shares. | On 31\u00a0Dec 2023, rewards to be paid correspond to the value of approximate number of 52 598 Tietoevry gross shares. |
EUR million | 2023 | 2022 |
Equity-settled share-based incentive plans | 9.5 | 6.9 |
Cash-settled share-based incentive plans | 0.1 | 0.0 |
Social costs settled in cash1) | 0.9 | 1.3 |
Total | 10.5 | 8.2 |
ACCOUNTING POLICIES | |||
Tax expense for the period includes current taxes of the Group companies based on taxable profit for the year, together with tax adjustments for previous years and changes in deferred taxes. Tax is recognized in the income statement, except to the extent that it relates to items recognized in other comprehensive income or directly in equity, in which case the related income tax is also recognized in other comprehensive income or directly in equity, respectively. The share of results in joint ventures is reported in the income statement based on the net result and thus, including the income tax effect. | |||
Deferred income tax is recognized, using the liability method, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements as well as on tax loss carry forwards. Deferred income tax is determined using the tax rates and laws which have been enacted or substantively enacted at the reporting date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred taxes are not recognized on temporary differences related to investments in subsidiaries to the extent that they will probably not be reversed in the foreseeable future. | |||
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. The deferred tax assets and liabilities arising from consolidation are recognized in the consolidated statement of financial position if it is probable that the related tax effects will occur. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
At each reporting date, management estimates the amount of probable future taxable profits against which unused tax losses can be utilized. As the actual profits may differ from the forecasts, the change will affect the taxes in future periods. | |||
The group operates globally and is, therefore subject to changing tax laws in multiple jurisdictions. The interpretation of tax legislation requires management judgement, and the applied interpretations may include uncertainties. |
EUR million | 2023 | 2022 |
Current taxes | 40.4 | 43.7 |
Change of deferred taxes | 11.2 | 5.8 |
Taxes for prior years | -3.0 | 4.7 |
Total | 48.6 | 54.2 |
Reconciliation of income tax expense | ||
Profit before taxes | 220.8 | 242.8 |
Tax calculated at the domestic corporation tax rate of 20% | 44.2 | 48.6 |
Effect of different tax rates in foreign subsidiaries | 2.8 | 2.4 |
Taxes for prior years | -3.0 | 4.7 |
Deferred taxes from previous year | 0.1 | -4.9 |
Tax effect of non-deductible expenses and tax exempt income | 1.3 | 2.3 |
Tax on foreign dividend distribution | 4.6 | 2.9 |
Other items | -1.4 | -1.8 |
Total | 48.6 | 54.2 |
Effective tax rate, % | 22.0 | 22.3 |
EUR million | 1\u00a0Jan\u00a02023 | Charged to income statement | Charged to other comprehensive income | Acquisitions and disposals | Other changes | 31\u00a0Dec 2023 |
Deferred tax asset | ||||||
Tax losses carried forward | 39.0 | -7.1 | \u2014 | \u2014 | -8.3 | 23.6 |
Property, plant and equipment | 10.8 | 5.9 | \u2014 | \u2014 | -0.2 | 16.6 |
Lease liabilities | 43.5 | -2.7 | \u2014 | 0.3 | -1.0 | 40.1 |
Employee benefits | 10.2 | -0.4 | -0.1 | \u2014 | -0.4 | 9.3 |
Provisions | 3.0 | -1.2 | \u2014 | \u2014 | -0.1 | 1.6 |
Revenue recognition | 6.3 | -2.3 | \u2014 | \u2014 | -0.4 | 3.6 |
Other temporary difference | 4.2 | 0.3 | \u2014 | 0.1 | -3.4 | 1.2 |
Total gross | 117.1 | -7.5 | -0.1 | 0.4 | -13.8 | 96.1 |
Offset against deferred tax liabilities | -102.5 | -84.2 | ||||
Total net | 14.6 | 11.8 | ||||
Deferred tax liability | ||||||
Intangible assets | 48.4 | -7.6 | \u2014 | 5.6 | -3.7 | 42.8 |
Right-of-use assets | 39.9 | -3.9 | \u2014 | 0.3 | -1.0 | 35.4 |
Untaxed reserves | 10.7 | -0.7 | \u2014 | \u2014 | 0.1 | 10.1 |
Other temporary difference | 14.2 | 15.7 | 0.1 | \u2014 | -6.5 | 23.5 |
Total gross | 113.2 | 3.6 | 0.1 | 5.9 | -11.0 | 111.7 |
Offset against deferred tax assets | -102.5 | -84.2 | ||||
Total net | 10.7 | 27.5 | ||||
Net deferred tax asset | 3.9 | -11.2 | -0.2 | -5.5 | -2.8 | -15.7 |
EUR million | 1\u00a0Jan\u00a02022 | Charged to income statement | Charged to other comprehensive income | Other changes | 31\u00a0Dec\u00a02022 |
Deferred tax asset | |||||
Tax losses carried forward | 49.6 | -9.8 | \u2014 | -0.8 | 39.0 |
Property, plant and equipment | 7.7 | 3.2 | \u2014 | -0.1 | 10.8 |
Lease liabilities | 46.0 | -0.4 | \u2014 | -2.1 | 43.5 |
Employee benefits | 11.8 | -0.7 | -0.4 | -0.5 | 10.2 |
Provisions | 3.6 | -0.4 | \u2014 | -0.2 | 3.0 |
Revenue recognition | 9.5 | -2.8 | \u2014 | -0.4 | 6.3 |
Other temporary difference | 4.7 | -0.6 | \u2014 | 0.1 | 4.2 |
Total gross | 132.9 | -11.4 | -0.4 | -4.0 | 117.1 |
Offset against deferred tax liabilities | -113.8 | -102.5 | |||
Total net | 19.1 | 14.6 | |||
Deferred tax liability | |||||
Intangible assets | 64.1 | -14.4 | \u2014 | -1.3 | 48.4 |
Right-of-use assets | 41.4 | 0.5 | \u2014 | -2.0 | 39.9 |
Untaxed reserves | 9.5 | 2.0 | \u2014 | -0.8 | 10.7 |
Other temporary difference | 7.9 | 6.3 | \u2014 | \u2014 | 14.2 |
Total gross | 122.9 | -5.6 | \u2014 | -4.1 | 113.2 |
Offset against deferred tax assets | -113.8 | -102.5 | |||
Total net | 9.1 | 10.7 | |||
Net deferred tax asset | 10.0 | -5.8 | -0.4 | 0.1 | 3.9 |
ACCOUNTING POLICIES | |||
Tax expense for the period includes current taxes of the Group companies based on taxable profit for the year, together with tax adjustments for previous years and changes in deferred taxes. Tax is recognized in the income statement, except to the extent that it relates to items recognized in other comprehensive income or directly in equity, in which case the related income tax is also recognized in other comprehensive income or directly in equity, respectively. The share of results in joint ventures is reported in the income statement based on the net result and thus, including the income tax effect. | |||
Deferred income tax is recognized, using the liability method, on temporary differences between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements as well as on tax loss carry forwards. Deferred income tax is determined using the tax rates and laws which have been enacted or substantively enacted at the reporting date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred taxes are not recognized on temporary differences related to investments in subsidiaries to the extent that they will probably not be reversed in the foreseeable future. | |||
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. The deferred tax assets and liabilities arising from consolidation are recognized in the consolidated statement of financial position if it is probable that the related tax effects will occur. |
EUR million | 1\u00a0Jan\u00a02023 | Charged to income statement | Charged to other comprehensive income | Acquisitions and disposals | Other changes | 31\u00a0Dec 2023 |
Deferred tax asset | ||||||
Tax losses carried forward | 39.0 | -7.1 | \u2014 | \u2014 | -8.3 | 23.6 |
Property, plant and equipment | 10.8 | 5.9 | \u2014 | \u2014 | -0.2 | 16.6 |
Lease liabilities | 43.5 | -2.7 | \u2014 | 0.3 | -1.0 | 40.1 |
Employee benefits | 10.2 | -0.4 | -0.1 | \u2014 | -0.4 | 9.3 |
Provisions | 3.0 | -1.2 | \u2014 | \u2014 | -0.1 | 1.6 |
Revenue recognition | 6.3 | -2.3 | \u2014 | \u2014 | -0.4 | 3.6 |
Other temporary difference | 4.2 | 0.3 | \u2014 | 0.1 | -3.4 | 1.2 |
Total gross | 117.1 | -7.5 | -0.1 | 0.4 | -13.8 | 96.1 |
Offset against deferred tax liabilities | -102.5 | -84.2 | ||||
Total net | 14.6 | 11.8 | ||||
Deferred tax liability | ||||||
Intangible assets | 48.4 | -7.6 | \u2014 | 5.6 | -3.7 | 42.8 |
Right-of-use assets | 39.9 | -3.9 | \u2014 | 0.3 | -1.0 | 35.4 |
Untaxed reserves | 10.7 | -0.7 | \u2014 | \u2014 | 0.1 | 10.1 |
Other temporary difference | 14.2 | 15.7 | 0.1 | \u2014 | -6.5 | 23.5 |
Total gross | 113.2 | 3.6 | 0.1 | 5.9 | -11.0 | 111.7 |
Offset against deferred tax assets | -102.5 | -84.2 | ||||
Total net | 10.7 | 27.5 | ||||
Net deferred tax asset | 3.9 | -11.2 | -0.2 | -5.5 | -2.8 | -15.7 |
EUR million | 1\u00a0Jan\u00a02022 | Charged to income statement | Charged to other comprehensive income | Other changes | 31\u00a0Dec\u00a02022 |
Deferred tax asset | |||||
Tax losses carried forward | 49.6 | -9.8 | \u2014 | -0.8 | 39.0 |
Property, plant and equipment | 7.7 | 3.2 | \u2014 | -0.1 | 10.8 |
Lease liabilities | 46.0 | -0.4 | \u2014 | -2.1 | 43.5 |
Employee benefits | 11.8 | -0.7 | -0.4 | -0.5 | 10.2 |
Provisions | 3.6 | -0.4 | \u2014 | -0.2 | 3.0 |
Revenue recognition | 9.5 | -2.8 | \u2014 | -0.4 | 6.3 |
Other temporary difference | 4.7 | -0.6 | \u2014 | 0.1 | 4.2 |
Total gross | 132.9 | -11.4 | -0.4 | -4.0 | 117.1 |
Offset against deferred tax liabilities | -113.8 | -102.5 | |||
Total net | 19.1 | 14.6 | |||
Deferred tax liability | |||||
Intangible assets | 64.1 | -14.4 | \u2014 | -1.3 | 48.4 |
Right-of-use assets | 41.4 | 0.5 | \u2014 | -2.0 | 39.9 |
Untaxed reserves | 9.5 | 2.0 | \u2014 | -0.8 | 10.7 |
Other temporary difference | 7.9 | 6.3 | \u2014 | \u2014 | 14.2 |
Total gross | 122.9 | -5.6 | \u2014 | -4.1 | 113.2 |
Offset against deferred tax assets | -113.8 | -102.5 | |||
Total net | 9.1 | 10.7 | |||
Net deferred tax asset | 10.0 | -5.8 | -0.4 | 0.1 | 3.9 |
ACCOUNTING POLICIES | |||
Basic Earnings per share (EPS) is calculated by dividing the net profit attributable to the shareholders of the Parent company by the weighted average number of shares in issue during the year, excluding shares purchased by Tietoevry and held as own shares. | |||
Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding during the year with the shares estimated to be delivered based on the share-based incentive plans. |
2023 | 2022 | |
Net profit for the financial year attributable to owners of the Parent company (EUR million) | 172.2 | 188.6 |
Earnings per share (EUR) | ||
Basic | 1.45 | 1.59 |
Diluted | 1.45 | 1.59 |
Weighted average number of shares during the year | ||
Basic | 118\u00a0375\u00a0769 | 118\u00a0405\u00a0657 |
Effect of dilutive share-based incentive plans | 271\u00a0334 | 203\u00a0952 |
Diluted | 118\u00a0647\u00a0103 | 118\u00a0609\u00a0609 |
ACCOUNTING POLICIES | |||
Basic Earnings per share (EPS) is calculated by dividing the net profit attributable to the shareholders of the Parent company by the weighted average number of shares in issue during the year, excluding shares purchased by Tietoevry and held as own shares. | |||
Diluted earnings per share is calculated by adjusting the weighted average number of shares outstanding during the year with the shares estimated to be delivered based on the share-based incentive plans. |
ACCOUNTING POLICIES | |||
Intangible assets other than goodwill are recognized initially at cost. An intangible asset is recognized only if it is probable that the future economic benefits attributable to the asset will flow to the Group and the cost of the asset can be measured reliably. All other costs are expensed as incurred. | |||
After initial recognition, intangible assets are measured at cost less amortization and accumulated impairment losses. Intangible assets are amortized over their useful lives with the straight-line method. Assets that are subject to amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Internally developed software | |||
Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development projects are analysed individually to determine the moment when the project has reached a milestone after which capitalization of development costs can start. Only costs which are directly attributable to the development are capitalised. |
Subsequent to initial recognition, these costs are measured at cost less accumulated amortization and impairment losses. The amortization period for internally developed software depends on the technology renewal cycle and contract duration. Internally developed software for which amortization has not yet started is tested for impairment on an annual basis by comparing the asset's carrying amount with its recoverable amount. If the carrying amount exceeds the recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Intangible assets recognised from acquisitions | |||
Intangible assets acquired in business combinations are measured at fair value at the acquisition date. These are usually customer or technology related and have finite useful lives. | |||
Gains and losses on disposal of intangible assets are included in other operating income and expenses. | |||
The Group applies the following useful lives: |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
Estimates are made when determining the fair values of assets acquired in a business combination. The valuation requires management to determine the appropriate valuation technique and inputs for fair value measurements, such as discount rate. | |||
Determining whether goodwill is impaired requires an estimation of the value-in-use of the cash- generating units (CGU) to which goodwill has been allocated. The value-in-use calculation requires management to estimate the future cash flows expected to arise from the CGUs and an appropriate discount rate to calculate present value. | |||
While management believes that the estimates and assumptions used are reasonable, there are uncertainties which could materially affect the valuations. |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Acquisitions of subsidiaries | 137.4 | 0.1 | 22.6 | \u2014 | \u2014 | \u2014 | 160.1 |
Additions | \u2014 | 6.9 | \u2014 | 44.7 | 0.0 | 0.6 | 52.1 |
Disposals | \u2014 | -8.5 | -17.3 | -5.5 | -9.9 | \u2014 | -41.3 |
Reclassifications | \u2014 | 2.3 | \u2014 | \u2014 | 0.7 | -2.6 | 0.4 |
Translation differences | -76.6 | -0.3 | -14.7 | -16.6 | -0.1 | -0.1 | -108.4 |
Acquisition cost 31\u00a0Dec 2023 | 1\u00a0907.3 | 29.9 | 282.0 | 330.8 | 19.9 | 1.2 | 2\u00a0571.1 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02023 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Disposals | \u2014 | 8.5 | 17.3 | 5.5 | 9.9 | \u2014 | 41.3 |
Amortization | \u2014 | -4.7 | -41.8 | -6.3 | -1.1 | \u2014 | -53.9 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.0 | \u2014 | -0.4 |
Translation differences | \u2014 | 0.4 | 6.8 | 6.4 | 0.1 | \u2014 | 13.6 |
Accumulated amortization and impairments 31\u00a0Dec 2023 | \u2014 | -18.7 | -171.5 | -117.0 | -17.2 | 0.0 | -324.3 |
Carrying value 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
Carrying value 31\u00a0Dec 2023 | 1\u00a0907.3 | 11.2 | 110.6 | 213.9 | 2.8 | 1.2 | 2\u00a0246.8 |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 49.6 | 308.6 | 285.3 | 38.2 | 3.5 | 2\u00a0628.9 |
Additions | \u2014 | 2.7 | \u2014 | 37.2 | 0.9 | 2.7 | 43.5 |
Disposals | \u2014 | -25.2 | \u2014 | \u2014 | -9.7 | -0.7 | -35.7 |
Reclassifications | \u2014 | 3.6 | \u2014 | -1.9 | 0.1 | -2.2 | -0.5 |
Translation differences | -97.1 | -1.1 | -17.3 | -12.2 | -0.1 | -0.0 | -128.0 |
Acquisition cost 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02022 | \u2014 | -42.5 | -115.4 | -103.3 | -35.3 | -0.7 | -297.3 |
Disposals | \u2014 | 25.2 | \u2014 | \u2014 | 9.7 | 0.7 | 35.7 |
Amortization | \u2014 | -6.0 | -46.7 | -4.8 | -0.9 | \u2014 | -58.5 |
Impairments | \u2014 | \u2014 | \u2014 | -18.7 | \u2014 | \u2014 | -18.7 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.3 | \u2014 | 0.0 |
Translation differences | \u2014 | 1.0 | 8.5 | 4.3 | 0.1 | \u2014 | 13.9 |
Accumulated amortization and impairments 31\u00a0Dec\u00a02022 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Carrying value 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 7.1 | 193.2 | 182.0 | 2.8 | 2.8 | 2\u00a0331.6 |
Carrying value 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Tietoevry Create | 697.7 | 575.5 |
Tietoevry Banking | 308.7 | 325.9 |
Tietoevry Care | 260.9 | 273.5 |
Tietoevry Industry | 188.4 | 197.5 |
Tietoevry Tech Services | 451.6 | 474.0 |
Total | 1\u00a0907.3 | 1\u00a0846.5 |
2023 | Five-year period 2024\u20132028 | |
Terminal growth rate % | Pre-tax WACC % | |
Tietoevry Create | 2.0 | 11.6 |
Tietoevry Banking | 2.0 | 9.1 |
Tietoevry Care | 2.0 | 8.8 |
Tietoevry Industry | 2.0 | 8.9 |
Tietoevry Tech Services | 2.0 | 8.9 |
ACCOUNTING POLICIES | |||
Intangible assets other than goodwill are recognized initially at cost. An intangible asset is recognized only if it is probable that the future economic benefits attributable to the asset will flow to the Group and the cost of the asset can be measured reliably. All other costs are expensed as incurred. | |||
After initial recognition, intangible assets are measured at cost less amortization and accumulated impairment losses. Intangible assets are amortized over their useful lives with the straight-line method. Assets that are subject to amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Internally developed software | |||
Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development projects are analysed individually to determine the moment when the project has reached a milestone after which capitalization of development costs can start. Only costs which are directly attributable to the development are capitalised. |
Subsequent to initial recognition, these costs are measured at cost less accumulated amortization and impairment losses. The amortization period for internally developed software depends on the technology renewal cycle and contract duration. Internally developed software for which amortization has not yet started is tested for impairment on an annual basis by comparing the asset's carrying amount with its recoverable amount. If the carrying amount exceeds the recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Intangible assets recognised from acquisitions | |||
Intangible assets acquired in business combinations are measured at fair value at the acquisition date. These are usually customer or technology related and have finite useful lives. | |||
Gains and losses on disposal of intangible assets are included in other operating income and expenses. | |||
The Group applies the following useful lives: |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
Estimates are made when determining the fair values of assets acquired in a business combination. The valuation requires management to determine the appropriate valuation technique and inputs for fair value measurements, such as discount rate. | |||
Determining whether goodwill is impaired requires an estimation of the value-in-use of the cash- generating units (CGU) to which goodwill has been allocated. The value-in-use calculation requires management to estimate the future cash flows expected to arise from the CGUs and an appropriate discount rate to calculate present value. | |||
While management believes that the estimates and assumptions used are reasonable, there are uncertainties which could materially affect the valuations. |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Acquisitions of subsidiaries | 137.4 | 0.1 | 22.6 | \u2014 | \u2014 | \u2014 | 160.1 |
Additions | \u2014 | 6.9 | \u2014 | 44.7 | 0.0 | 0.6 | 52.1 |
Disposals | \u2014 | -8.5 | -17.3 | -5.5 | -9.9 | \u2014 | -41.3 |
Reclassifications | \u2014 | 2.3 | \u2014 | \u2014 | 0.7 | -2.6 | 0.4 |
Translation differences | -76.6 | -0.3 | -14.7 | -16.6 | -0.1 | -0.1 | -108.4 |
Acquisition cost 31\u00a0Dec 2023 | 1\u00a0907.3 | 29.9 | 282.0 | 330.8 | 19.9 | 1.2 | 2\u00a0571.1 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02023 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Disposals | \u2014 | 8.5 | 17.3 | 5.5 | 9.9 | \u2014 | 41.3 |
Amortization | \u2014 | -4.7 | -41.8 | -6.3 | -1.1 | \u2014 | -53.9 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.0 | \u2014 | -0.4 |
Translation differences | \u2014 | 0.4 | 6.8 | 6.4 | 0.1 | \u2014 | 13.6 |
Accumulated amortization and impairments 31\u00a0Dec 2023 | \u2014 | -18.7 | -171.5 | -117.0 | -17.2 | 0.0 | -324.3 |
Carrying value 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
Carrying value 31\u00a0Dec 2023 | 1\u00a0907.3 | 11.2 | 110.6 | 213.9 | 2.8 | 1.2 | 2\u00a0246.8 |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 49.6 | 308.6 | 285.3 | 38.2 | 3.5 | 2\u00a0628.9 |
Additions | \u2014 | 2.7 | \u2014 | 37.2 | 0.9 | 2.7 | 43.5 |
Disposals | \u2014 | -25.2 | \u2014 | \u2014 | -9.7 | -0.7 | -35.7 |
Reclassifications | \u2014 | 3.6 | \u2014 | -1.9 | 0.1 | -2.2 | -0.5 |
Translation differences | -97.1 | -1.1 | -17.3 | -12.2 | -0.1 | -0.0 | -128.0 |
Acquisition cost 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02022 | \u2014 | -42.5 | -115.4 | -103.3 | -35.3 | -0.7 | -297.3 |
Disposals | \u2014 | 25.2 | \u2014 | \u2014 | 9.7 | 0.7 | 35.7 |
Amortization | \u2014 | -6.0 | -46.7 | -4.8 | -0.9 | \u2014 | -58.5 |
Impairments | \u2014 | \u2014 | \u2014 | -18.7 | \u2014 | \u2014 | -18.7 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.3 | \u2014 | 0.0 |
Translation differences | \u2014 | 1.0 | 8.5 | 4.3 | 0.1 | \u2014 | 13.9 |
Accumulated amortization and impairments 31\u00a0Dec\u00a02022 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Carrying value 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 7.1 | 193.2 | 182.0 | 2.8 | 2.8 | 2\u00a0331.6 |
Carrying value 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Tietoevry Create | 697.7 | 575.5 |
Tietoevry Banking | 308.7 | 325.9 |
Tietoevry Care | 260.9 | 273.5 |
Tietoevry Industry | 188.4 | 197.5 |
Tietoevry Tech Services | 451.6 | 474.0 |
Total | 1\u00a0907.3 | 1\u00a0846.5 |
2023 | Five-year period 2024\u20132028 | |
Terminal growth rate % | Pre-tax WACC % | |
Tietoevry Create | 2.0 | 11.6 |
Tietoevry Banking | 2.0 | 9.1 |
Tietoevry Care | 2.0 | 8.8 |
Tietoevry Industry | 2.0 | 8.9 |
Tietoevry Tech Services | 2.0 | 8.9 |
ACCOUNTING POLICIES | |||
Intangible assets other than goodwill are recognized initially at cost. An intangible asset is recognized only if it is probable that the future economic benefits attributable to the asset will flow to the Group and the cost of the asset can be measured reliably. All other costs are expensed as incurred. | |||
After initial recognition, intangible assets are measured at cost less amortization and accumulated impairment losses. Intangible assets are amortized over their useful lives with the straight-line method. Assets that are subject to amortization are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the intangible asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Internally developed software | |||
Development costs related to major new software products are capitalized as intangible assets when it is probable that the development will generate future economic benefits for the Group, and certain criteria related to commercial and technological feasibility are met. Development projects are analysed individually to determine the moment when the project has reached a milestone after which capitalization of development costs can start. Only costs which are directly attributable to the development are capitalised. |
Subsequent to initial recognition, these costs are measured at cost less accumulated amortization and impairment losses. The amortization period for internally developed software depends on the technology renewal cycle and contract duration. Internally developed software for which amortization has not yet started is tested for impairment on an annual basis by comparing the asset's carrying amount with its recoverable amount. If the carrying amount exceeds the recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
Intangible assets recognised from acquisitions | |||
Intangible assets acquired in business combinations are measured at fair value at the acquisition date. These are usually customer or technology related and have finite useful lives. | |||
Gains and losses on disposal of intangible assets are included in other operating income and expenses. | |||
The Group applies the following useful lives: |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
Years | |
Software acquired separately | 3 |
Other intangible assets | 3\u201310 |
Technology related intangible assets recognized at fair value from acquisitions | 3\u201315 |
Customer related intangible assets recognized at fair value from acquisitions | 2\u201310 |
Trademark recognized at fair value from acquisitions | 6 |
Internally developed software (capitalized development costs) | 5\u201315 |
Goodwill | |||
Goodwill arising on a business combination represents the excess of the aggregate of the consideration transferred, the amount of non-controlling interests in the acquiree and previously held equity interest in the acquiree over the fair value of the Group\u2019s share of the identifiable net assets acquired. Goodwill is measured at cost less accumulated impairment losses. It is not amortized, but tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the operating segments of the Group, which are the cash generating units (CGU) expected to benefit from the synergies of the business combination. If the carrying amount of goodwill allocated to the operating segments exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss. The recoverable amount is the higher of the value in use represented by the net present value of future cash flows and the fair value less costs to sell. Impairment losses on goodwill are not reversed. | |||
In respect of joint ventures, goodwill is included in the carrying amount of the investment. |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Acquisitions of subsidiaries | 137.4 | 0.1 | 22.6 | \u2014 | \u2014 | \u2014 | 160.1 |
Additions | \u2014 | 6.9 | \u2014 | 44.7 | 0.0 | 0.6 | 52.1 |
Disposals | \u2014 | -8.5 | -17.3 | -5.5 | -9.9 | \u2014 | -41.3 |
Reclassifications | \u2014 | 2.3 | \u2014 | \u2014 | 0.7 | -2.6 | 0.4 |
Translation differences | -76.6 | -0.3 | -14.7 | -16.6 | -0.1 | -0.1 | -108.4 |
Acquisition cost 31\u00a0Dec 2023 | 1\u00a0907.3 | 29.9 | 282.0 | 330.8 | 19.9 | 1.2 | 2\u00a0571.1 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02023 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Disposals | \u2014 | 8.5 | 17.3 | 5.5 | 9.9 | \u2014 | 41.3 |
Amortization | \u2014 | -4.7 | -41.8 | -6.3 | -1.1 | \u2014 | -53.9 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.0 | \u2014 | -0.4 |
Translation differences | \u2014 | 0.4 | 6.8 | 6.4 | 0.1 | \u2014 | 13.6 |
Accumulated amortization and impairments 31\u00a0Dec 2023 | \u2014 | -18.7 | -171.5 | -117.0 | -17.2 | 0.0 | -324.3 |
Carrying value 1\u00a0Jan\u00a02023 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
Carrying value 31\u00a0Dec 2023 | 1\u00a0907.3 | 11.2 | 110.6 | 213.9 | 2.8 | 1.2 | 2\u00a0246.8 |
EUR million | Goodwill | Software acquired separately | Intangible assets recognized from acquisitions1) | Internally developed software2) | Other | Advance payments | Total |
Acquisition cost 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 49.6 | 308.6 | 285.3 | 38.2 | 3.5 | 2\u00a0628.9 |
Additions | \u2014 | 2.7 | \u2014 | 37.2 | 0.9 | 2.7 | 43.5 |
Disposals | \u2014 | -25.2 | \u2014 | \u2014 | -9.7 | -0.7 | -35.7 |
Reclassifications | \u2014 | 3.6 | \u2014 | -1.9 | 0.1 | -2.2 | -0.5 |
Translation differences | -97.1 | -1.1 | -17.3 | -12.2 | -0.1 | -0.0 | -128.0 |
Acquisition cost 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 29.5 | 291.3 | 308.3 | 29.3 | 3.3 | 2\u00a0508.2 |
Accumulated amortization and impairments 1\u00a0Jan\u00a02022 | \u2014 | -42.5 | -115.4 | -103.3 | -35.3 | -0.7 | -297.3 |
Disposals | \u2014 | 25.2 | \u2014 | \u2014 | 9.7 | 0.7 | 35.7 |
Amortization | \u2014 | -6.0 | -46.7 | -4.8 | -0.9 | \u2014 | -58.5 |
Impairments | \u2014 | \u2014 | \u2014 | -18.7 | \u2014 | \u2014 | -18.7 |
Reclassifications | \u2014 | -0.4 | \u2014 | \u2014 | 0.3 | \u2014 | 0.0 |
Translation differences | \u2014 | 1.0 | 8.5 | 4.3 | 0.1 | \u2014 | 13.9 |
Accumulated amortization and impairments 31\u00a0Dec\u00a02022 | \u2014 | -22.6 | -153.6 | -122.6 | -26.1 | 0.0 | -324.9 |
Carrying value 1\u00a0Jan\u00a02022 | 1\u00a0943.7 | 7.1 | 193.2 | 182.0 | 2.8 | 2.8 | 2\u00a0331.6 |
Carrying value 31\u00a0Dec\u00a02022 | 1\u00a0846.5 | 6.9 | 137.7 | 185.7 | 3.2 | 3.3 | 2\u00a0183.3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Tietoevry Create | 697.7 | 575.5 |
Tietoevry Banking | 308.7 | 325.9 |
Tietoevry Care | 260.9 | 273.5 |
Tietoevry Industry | 188.4 | 197.5 |
Tietoevry Tech Services | 451.6 | 474.0 |
Total | 1\u00a0907.3 | 1\u00a0846.5 |
2023 | Five-year period 2024\u20132028 | |
Terminal growth rate % | Pre-tax WACC % | |
Tietoevry Create | 2.0 | 11.6 |
Tietoevry Banking | 2.0 | 9.1 |
Tietoevry Care | 2.0 | 8.8 |
Tietoevry Industry | 2.0 | 8.9 |
Tietoevry Tech Services | 2.0 | 8.9 |
ACCOUNTING POLICIES | |||
Property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. | |||
Land is not depreciated. Property, plant and equipment acquired in business combinations are measured at fair value at the acquisition date. Depreciation is recognized according to plan based on the estimated economic lives of the individual assets and accounted for in accordance with the straight-line method. The assets' residual useful lives are reviewed, and adjusted if appropriate, at each reporting date. | |||
Assets that are subject to depreciation are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
The group applies the following useful lives: |
Years | |
Buildings and structures | 25\u201340 |
Data processing equipment1) | 1\u20135 |
Other machinery and equipment | 5 |
Other tangible assets | 5 |
EUR million | Land | Buildings and structures | Machinery and equipment | Other tangible assets | Advance payments and work in progress | Total |
Acquisition cost 1\u00a0Jan\u00a02023 | 1.2 | 3.8 | 385.6 | 64.7 | 19.1 | 474.4 |
Acquisitions of subsidiaries | \u2014 | \u2014 | 0.3 | 0.4 | 0.1 | 0.8 |
Additions | \u2014 | \u2014 | 21.3 | 2.4 | 9.5 | 33.2 |
Disposals | \u2014 | -0.4 | -76.8 | -4.3 | -0.1 | -81.6 |
Reclassifications | \u2014 | \u2014 | 14.8 | 0.5 | -14.0 | 1.3 |
Translation differences | \u2014 | \u2014 | -5.5 | -0.2 | -0.3 | -6.0 |
Acquisition cost 31\u00a0Dec 2023 | 1.2 | 3.4 | 339.7 | 63.4 | 14.4 | 422.1 |
Accumulated depreciation and impairments 1\u00a0Jan\u00a02023 | \u2014 | -2.1 | -330.3 | -44.9 | 0.0 | -377.2 |
Disposals | \u2014 | 0.4 | 74.6 | 4.2 | \u2014 | 79.2 |
Depreciation | \u2014 | -0.1 | -32.2 | -6.4 | \u2014 | -38.8 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | \u2014 | -1.3 | 0.0 | \u2014 | -1.3 |
Translation differences | \u2014 | \u2014 | 4.8 | 0.0 | \u2014 | 4.8 |
Accumulated depreciation and impairments 31\u00a0Dec 2023 | \u2014 | -1.8 | -284.5 | -47.1 | 0.0 | -333.4 |
Carrying value 1\u00a0Jan\u00a02023 | 1.2 | 1.7 | 55.4 | 19.8 | 19.1 | 97.2 |
Carrying value 31\u00a0Dec 2023 | 1.2 | 1.6 | 55.2 | 16.3 | 14.4 | 88.8 |
EUR million | Land | Buildings and structures | Machinery and equipment | Other tangible assets | Advance payments and work in progress | Total |
Acquisition cost 1\u00a0Jan\u00a02022 | 1.2 | 3.8 | 408.3 | 61.5 | 12.7 | 487.5 |
Additions | \u2014 | \u2014 | 29.4 | 4.5 | 16.2 | 50.0 |
Disposals | \u2014 | \u2014 | -50.3 | -1.5 | -1.1 | -52.9 |
Reclassifications | \u2014 | \u2014 | 10.6 | 1.9 | -8.3 | 4.1 |
Translation differences | \u2014 | \u2014 | -12.3 | -1.7 | -0.3 | -14.3 |
Acquisition cost 31\u00a0Dec\u00a02022 | 1.2 | 3.8 | 385.6 | 64.7 | 19.1 | 474.4 |
Accumulated depreciation and impairments 1\u00a0Jan\u00a02022 | \u2014 | -2.0 | -356.9 | -40.3 | -0.9 | -400.1 |
Disposals | \u2014 | \u2014 | 49.1 | 1.5 | 0.9 | 51.6 |
Depreciation | \u2014 | -0.1 | -29.9 | -7.4 | \u2014 | -37.4 |
Impairments | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Reclassifications | \u2014 | \u2014 | -3.5 | -0.1 | 0.0 | -3.6 |
Translation differences | \u2014 | \u2014 | 10.9 | 1.4 | \u2014 | 12.3 |
Accumulated depreciation and impairments 31\u00a0Dec\u00a02022 | \u2014 | -2.1 | -330.3 | -44.9 | 0.0 | -377.2 |
Carrying value 1\u00a0Jan\u00a02022 | 1.2 | 1.8 | 51.4 | 21.2 | 11.8 | 87.4 |
Carrying value 31\u00a0Dec\u00a02022 | 1.2 | 1.7 | 55.4 | 19.8 | 19.1 | 97.2 |
ACCOUNTING POLICIES | |||
Property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. | |||
Land is not depreciated. Property, plant and equipment acquired in business combinations are measured at fair value at the acquisition date. Depreciation is recognized according to plan based on the estimated economic lives of the individual assets and accounted for in accordance with the straight-line method. The assets' residual useful lives are reviewed, and adjusted if appropriate, at each reporting date. | |||
Assets that are subject to depreciation are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying amount of the asset exceeds its recoverable amount, an impairment loss equal to the difference is recognized in profit or loss.\u00a0 | |||
The group applies the following useful lives: |
Years | |
Buildings and structures | 25\u201340 |
Data processing equipment1) | 1\u20135 |
Other machinery and equipment | 5 |
Other tangible assets | 5 |
ACCOUNTING POLICIES | |||
The Group as a lessee | |||
The Group assesses whether a contract is, or contains, a lease at inception of the contract. The Group recognizes a right-of-use asset and a corresponding lease liability at the commencement date of a lease. Initially, the lease liability is measured at the present value of the future lease payments to be made over the lease period. The lease payments include fixed payments, less any lease incentives receivable, variable lease payments that depend on an index or rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option if it is reasonably certain to be exercised and payments of penalties for terminating the lease if the lease term reflects the exercise of a termination option. | |||
To determine the present value of future lease payments, the Group discounts the lease payments using the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. The incremental borrowing rate reflects the rate at which the Group could borrow an amount similar to the value of the right-of-use asset in a similar economic environment. At year-end, the average annual incremental borrowing rate applied to discount remaining lease payments for existing lease agreements is 5.9%. | |||
The Group determines the lease term as the non-cancellable period of the lease, together with the periods covered by an option to extend the lease, if it is reasonably certain to be exercised, and periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Group has some lease contracts for which the lease term is cancellable with only a short notification period (\u201cevergreen leases\u201d). Management uses judgement to evaluate the lease term for leases with extension or termination options, and for leases with a short notification period. Management estimates the lease term based on overall strategy and business development plans as well as contract specific facts and circumstances. | |||
At 31\u00a0December 2023, the weighted average residual lease term for lease contracts is 6.6 years (residual terms vary between 0.1 - 16.3 years). |
Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets comprises the initial measurement of the corresponding lease liability, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful life of the underlying asset. | |||
Lease liabilities are measured at amortized cost. The carrying amount of lease liabilities is increased to reflect the interest on the lease liability and decreased for the lease payments made. Interest expenses related to the lease liabilities are recognized in profit or loss. The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term or in lease payments, or a change in the Group\u2019s assessment of an option to purchase the underlying asset. | |||
The Group applies the recognition exemption provided for leases. Lease payments for leases of low value assets and short-term leases (less than 12 months) are recognized in the income statement on a straight-line basis. The low value assets comprise IT equipment and office furniture. | |||
The Group has elected to separate the service component of a lease for all asset types, except for cars, where only variable lease payments are excluded from the measurement of the lease liability. Non-lease components are separated from lease payments based on fair market value. If such information is not readily available, management judgment is applied in estimating the value. | |||
The Group presents the payment of the principal portion of the lease liability in the cash flows from financing activities and the interest portion in the cash flows from operating activities. Lease payments related to low value assets and short-term leases are presented in cash flow from operating activities. | |||
The Group as a lessor | |||
If an arrangement conveys a right to use a specific asset to a purchaser, often together with related services, the assets, mainly technical equipment, are classified as embedded finance leases. Further the lease is classified either as Operating lease or Finance lease. At 31\u00a0December 2023, all such cases have been classified as Finance leases. Sales derived from these embedded finance leases are recognized at the beginning of the agreement period. The annual payments are disclosed as amortization of the finance lease loan receivable and interest income. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | |
Tietoevry as a Lessee | Depreciation expenses of right-of-use assets | -59.8 | -66.4 |
Tietoevry as a Lessee | Impairment losses | -2.7 | \u2014 |
Tietoevry as a Lessee | Variable lease payments | -8.5 | -7.9 |
Tietoevry as a Lessee | Short-term leases and low value leases | -4.2 | -5.2 |
Other income and expenses | -12.7 | -13.1 | |
Tietoevry as a Lessor | Revenue | 2.7 | 0.8 |
Tietoevry as a Lessor | Materials and services | -1.5 | -0.7 |
Tietoevry as a Lessor | Finance income on the net investment in lease | 0.1 | 0.1 |
Tietoevry as a Lessee | Interest expense on lease liabilities | -10.6 | -9.7 |
Expenses reported in financial items | -10.5 | -9.6 | |
Total impact on income statement from leasing contracts | -84.4 | -89.0 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | |
Tietoevry as a Lessee | Interest paid (cash flow from operating activities) | -9.6 | -9.4 |
Principal paid (cash flow from financing activities) | -58.1 | -66.3 |
EUR million | Buildings | Machinery and Equipment | Total | |
Tietoevry as a Lessee | 31\u00a0Dec\u00a02022 | 185.9 | 16.0 | 201.9 |
Acquisitions | 2.2 | \u2014 | 2.2 | |
Additions1) | 60.7 | 15.8 | 76.5 | |
Terminations | -14.0 | -2.7 | -16.7 | |
Depreciation | -49.8 | -10.0 | -59.8 | |
Impairment2) | -2.7 | \u2014 | -2.7 | |
Other | 0.0 | 0.0 | 0.0 | |
Currency translation differences | -5.4 | -0.2 | -5.6 | |
31\u00a0Dec\u00a02023 | 177.0 | 18.9 | 195.9 |
EUR million | Buildings | Machinery and Equipment | Total | |
Tietoevry as a Lessee | 31\u00a0Dec\u00a02021 | 171.5 | 21.0 | 192.4 |
Divestment of subsidiary | -0.1 | \u2014 | -0.1 | |
Additions1) | 95.7 | 9.6 | 105.3 | |
Terminations | -19.9 | -1.8 | -21.7 | |
Depreciation | -54.2 | -12.3 | -66.4 | |
Currency translation differences | -7.1 | -0.5 | -7.6 | |
31\u00a0Dec\u00a02022 | 185.9 | 16.0 | 201.9 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Current | 50.3 | 54.1 |
Non-current | 161.4 | 155.9 |
Total | 211.7 | 210.0 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Current | 2.2 | 2.4 |
Non-current | \u2014 | 0.2 |
Total | 2.2 | 2.6 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Within one year | 2.2 | 2.4 |
One to two years | \u2014 | 0.2 |
Total undiscounted lease receivable | 2.2 | 2.7 |
Unearned finance income | 0.0 | 0.0 |
Net investment in leases | 2.2 | 2.6 |
ACCOUNTING POLICIES | |||
The Group as a lessee | |||
The Group assesses whether a contract is, or contains, a lease at inception of the contract. The Group recognizes a right-of-use asset and a corresponding lease liability at the commencement date of a lease. Initially, the lease liability is measured at the present value of the future lease payments to be made over the lease period. The lease payments include fixed payments, less any lease incentives receivable, variable lease payments that depend on an index or rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option if it is reasonably certain to be exercised and payments of penalties for terminating the lease if the lease term reflects the exercise of a termination option. | |||
To determine the present value of future lease payments, the Group discounts the lease payments using the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. The incremental borrowing rate reflects the rate at which the Group could borrow an amount similar to the value of the right-of-use asset in a similar economic environment. At year-end, the average annual incremental borrowing rate applied to discount remaining lease payments for existing lease agreements is 5.9%. | |||
The Group determines the lease term as the non-cancellable period of the lease, together with the periods covered by an option to extend the lease, if it is reasonably certain to be exercised, and periods covered by an option to terminate the lease, if it is reasonably certain not to be exercised. The Group has some lease contracts for which the lease term is cancellable with only a short notification period (\u201cevergreen leases\u201d). Management uses judgement to evaluate the lease term for leases with extension or termination options, and for leases with a short notification period. Management estimates the lease term based on overall strategy and business development plans as well as contract specific facts and circumstances. | |||
At 31\u00a0December 2023, the weighted average residual lease term for lease contracts is 6.6 years (residual terms vary between 0.1 - 16.3 years). |
Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets comprises the initial measurement of the corresponding lease liability, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful life of the underlying asset. | |||
Lease liabilities are measured at amortized cost. The carrying amount of lease liabilities is increased to reflect the interest on the lease liability and decreased for the lease payments made. Interest expenses related to the lease liabilities are recognized in profit or loss. The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term or in lease payments, or a change in the Group\u2019s assessment of an option to purchase the underlying asset. | |||
The Group applies the recognition exemption provided for leases. Lease payments for leases of low value assets and short-term leases (less than 12 months) are recognized in the income statement on a straight-line basis. The low value assets comprise IT equipment and office furniture. | |||
The Group has elected to separate the service component of a lease for all asset types, except for cars, where only variable lease payments are excluded from the measurement of the lease liability. Non-lease components are separated from lease payments based on fair market value. If such information is not readily available, management judgment is applied in estimating the value. | |||
The Group presents the payment of the principal portion of the lease liability in the cash flows from financing activities and the interest portion in the cash flows from operating activities. Lease payments related to low value assets and short-term leases are presented in cash flow from operating activities. | |||
The Group as a lessor | |||
If an arrangement conveys a right to use a specific asset to a purchaser, often together with related services, the assets, mainly technical equipment, are classified as embedded finance leases. Further the lease is classified either as Operating lease or Finance lease. At 31\u00a0December 2023, all such cases have been classified as Finance leases. Sales derived from these embedded finance leases are recognized at the beginning of the agreement period. The annual payments are disclosed as amortization of the finance lease loan receivable and interest income. |
ACCOUNTING POLICIES | |||
Trade receivables are initially recognised at fair value and subsequently at amortized cost less expected credit loss allowance (ECL). Tietoevry has elected to use the practical expedient and calculate lifetime ECL based on a pre-defined allowance matrix with customer segment specific credit characteristics, based on the following criteria: \u2022 Country Group (Finland, Sweden, Norway, Other European Union countries, Other countries) \u2022 Customer Industry Group (Financial Services, Public Healthcare & Welfare, Industrial customer Services) \u2022 Balance due status (Not yet due, overdue 1\u20137 days, 8\u201330 days, 31\u201360 days, 61\u201390 days, over 90 days) | |||
Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. Default is defined as 90 days past due or a write off event, due to inability to collect debt. | |||
For each segment, the ECL rate (expressed as a percentage) indicates the historical average defaults identified during the past three years and also the Group\u2019s assessment of the possible impact from changes in the overall economic environment in which its customers operate. These collective allowances can be increased if the customer has filed for bankruptcy but has not yet registered the fact or if there are any facts or circumstances indicating that the customer\u2019s credit risk is above industry/country average. |
No ECL is calculated for the portion of trade receivables, where the credit risk is covered by credit insurance. When calculating ECL for contract assets, Tietoevry uses the ECL rate set for \u201cnot yet due\u201d invoices in the allowance matrix. | |||
Trade receivables are permanently written off when there is no reasonable expectation of recovery. Subsequent recoveries of amounts previously written off are credited to the income statement. Other interest-bearing receivables are initially recognized at fair value and subsequently at amortized cost during the contract period. The carrying amount of the trade and other receivables approximate their fair values due to their short-term nature. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Non-current | ||
Prepaid expenses and accrued income | 29.3 | 9.0 |
Finance lease receivables | \u2014 | 0.2 |
Other | 5.4 | 11.4 |
Total | 34.7 | 20.6 |
Current | ||
Trade receivables at amortized cost | 476.8 | 408.9 |
Prepaid expenses and accrued income | ||
Contract assets | 58.4 | 52.0 |
Licence fees | 32.9 | 30.6 |
Other prepaid expenses and accrued income | 54.3 | 28.2 |
Finance lease receivables | 2.2 | 2.4 |
Other interest-bearing receivables | 14.4 | 13.6 |
Other | 14.6 | 14.4 |
Total | 653.6 | 550.2 |
31\u00a0Dec 2023 | Not yet due | Overdue 1\u20137 days | Overdue 8\u201330 days | Overdue 31\u201360 days | Overdue 61\u201390 days | Overdue over 90 days | Grand Total |
EUR million | |||||||
Gross trade receivables subject to impairment | 368.2 | 82.3 | 4.8 | 4.1 | 2.9 | 17.4 | 479.6 |
Average expected credit loss rate applied1) | -0.01 % | -0.01 % | -3.25 % | -3.64 % | -2.62 % | -7.85 % | -0.37 % |
Collective loss allowance | -0.0 | -0.0 | -0.2 | -0.1 | -0.1 | -1.4 | -1.8 |
Individual loss allowance | -0.0 | -0.1 | -0.0 | -0.3 | -0.0 | -0.5 | -1.0 |
Total loss allowance | -0.1 | -0.1 | -0.2 | -0.5 | -0.1 | -1.8 | -2.8 |
Trade receivables net of ECL | 368.1 | 82.2 | 4.7 | 3.6 | 2.8 | 15.5 | 476.8 |
Trade receivables covered by credit insurance2) | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Total trade receivables at amortized cost | 368.1 | 82.2 | 4.7 | 3.6 | 2.8 | 15.5 | 476.8 |
31\u00a0Dec\u00a02022 | Not yet due | Overdue 1\u20137 days | Overdue 8\u201330 days | Overdue 31\u201360 days | Overdue 61\u201390 days | Overdue over 90 days | Grand Total |
EUR million | |||||||
Gross trade receivables subject to impairment | 227.9 | 16.4 | 1.4 | 3.2 | 0.5 | 2.3 | 251.7 |
Average expected credit loss rate applied | -0.12% | -0.62% | -1.49% | -1.82% | -3.71% | -51.61% | -0.66% |
Collective loss allowance | -0.3 | -0.1 | -0.0 | -0.1 | -0.0 | -1.2 | -1.7 |
Individual loss allowance | -0.4 | -0.0 | \u2014 | -0.4 | -0.1 | -0.2 | -1.1 |
Total loss allowance | -0.6 | -0.1 | -0.0 | -0.4 | -0.1 | -1.4 | -2.7 |
Trade receivables net of ECL | 227.3 | 16.2 | 1.4 | 2.7 | 0.4 | 1.0 | 248.9 |
Trade receivables covered by credit insurance | 142.2 | 15.0 | 0.6 | 1.3 | 0.5 | 0.4 | 160.0 |
Total trade receivables at amortized cost | 369.5 | 31.2 | 2.0 | 4.0 | 0.9 | 1.4 | 408.9 |
Not yet due | Not yet due | |
EUR million | 2023 | 2022 |
Contract assets | 58.4 | 52.1 |
Average ECL applied | -0.06% | -0.25% |
Collective loss allowance | 0.0 | -0.1 |
Net contract assets | 58.4 | 52.0 |
Trade receivables | ||
EUR million | 2023 | 2022 |
1 Jan | 2.7 | 2.9 |
Translation differences | -0.1 | -0.1 |
Impairment losses recognized | 1.8 | 3.7 |
Amounts written off this year as uncollectible | -0.6 | \u2014 |
Impairment losses reversed | -1.1 | -3.7 |
Disposed companies | \u2014 | -0.1 |
31 Dec | 2.8 | 2.7 |
ACCOUNTING POLICIES | |||
Trade receivables are initially recognised at fair value and subsequently at amortized cost less expected credit loss allowance (ECL). Tietoevry has elected to use the practical expedient and calculate lifetime ECL based on a pre-defined allowance matrix with customer segment specific credit characteristics, based on the following criteria: \u2022 Country Group (Finland, Sweden, Norway, Other European Union countries, Other countries) \u2022 Customer Industry Group (Financial Services, Public Healthcare & Welfare, Industrial customer Services) \u2022 Balance due status (Not yet due, overdue 1\u20137 days, 8\u201330 days, 31\u201360 days, 61\u201390 days, over 90 days) | |||
Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. Default is defined as 90 days past due or a write off event, due to inability to collect debt. | |||
For each segment, the ECL rate (expressed as a percentage) indicates the historical average defaults identified during the past three years and also the Group\u2019s assessment of the possible impact from changes in the overall economic environment in which its customers operate. These collective allowances can be increased if the customer has filed for bankruptcy but has not yet registered the fact or if there are any facts or circumstances indicating that the customer\u2019s credit risk is above industry/country average. |
No ECL is calculated for the portion of trade receivables, where the credit risk is covered by credit insurance. When calculating ECL for contract assets, Tietoevry uses the ECL rate set for \u201cnot yet due\u201d invoices in the allowance matrix. | |||
Trade receivables are permanently written off when there is no reasonable expectation of recovery. Subsequent recoveries of amounts previously written off are credited to the income statement. Other interest-bearing receivables are initially recognized at fair value and subsequently at amortized cost during the contract period. The carrying amount of the trade and other receivables approximate their fair values due to their short-term nature. |
31\u00a0Dec 2023 | Not yet due | Overdue 1\u20137 days | Overdue 8\u201330 days | Overdue 31\u201360 days | Overdue 61\u201390 days | Overdue over 90 days | Grand Total |
EUR million | |||||||
Gross trade receivables subject to impairment | 368.2 | 82.3 | 4.8 | 4.1 | 2.9 | 17.4 | 479.6 |
Average expected credit loss rate applied1) | -0.01 % | -0.01 % | -3.25 % | -3.64 % | -2.62 % | -7.85 % | -0.37 % |
Collective loss allowance | -0.0 | -0.0 | -0.2 | -0.1 | -0.1 | -1.4 | -1.8 |
Individual loss allowance | -0.0 | -0.1 | -0.0 | -0.3 | -0.0 | -0.5 | -1.0 |
Total loss allowance | -0.1 | -0.1 | -0.2 | -0.5 | -0.1 | -1.8 | -2.8 |
Trade receivables net of ECL | 368.1 | 82.2 | 4.7 | 3.6 | 2.8 | 15.5 | 476.8 |
Trade receivables covered by credit insurance2) | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Total trade receivables at amortized cost | 368.1 | 82.2 | 4.7 | 3.6 | 2.8 | 15.5 | 476.8 |
31\u00a0Dec\u00a02022 | Not yet due | Overdue 1\u20137 days | Overdue 8\u201330 days | Overdue 31\u201360 days | Overdue 61\u201390 days | Overdue over 90 days | Grand Total |
EUR million | |||||||
Gross trade receivables subject to impairment | 227.9 | 16.4 | 1.4 | 3.2 | 0.5 | 2.3 | 251.7 |
Average expected credit loss rate applied | -0.12% | -0.62% | -1.49% | -1.82% | -3.71% | -51.61% | -0.66% |
Collective loss allowance | -0.3 | -0.1 | -0.0 | -0.1 | -0.0 | -1.2 | -1.7 |
Individual loss allowance | -0.4 | -0.0 | \u2014 | -0.4 | -0.1 | -0.2 | -1.1 |
Total loss allowance | -0.6 | -0.1 | -0.0 | -0.4 | -0.1 | -1.4 | -2.7 |
Trade receivables net of ECL | 227.3 | 16.2 | 1.4 | 2.7 | 0.4 | 1.0 | 248.9 |
Trade receivables covered by credit insurance | 142.2 | 15.0 | 0.6 | 1.3 | 0.5 | 0.4 | 160.0 |
Total trade receivables at amortized cost | 369.5 | 31.2 | 2.0 | 4.0 | 0.9 | 1.4 | 408.9 |
ACCOUNTING POLICIES | |||
A provision is a liability of uncertain timing or amount which is recognized when the entity has a present legal or constructive obligation as a result of a past event and it is more likely than not that an outflow of economic benefits will be required to settle the obligation and the amount of the obligation can be measured reliably. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation and are split between amounts expected to be settled within 12 months at the end of the reporting period and amounts expected to be settled later (non-current). | |||
Provisions for restructuring | |||
A restructuring provision is only recognized when a formal plan has been approved and the implementation of it has either commenced or the plan has been announced. | |||
Provisions for warranties | |||
The Group's warranties provide assurance that the delivery will function as expected and in accordance with contract specifications. Provisions related to these assurance-type warranties are recognized during the project and used during the warranty period. | |||
Other provisions | |||
Other provisions include provisions for loss making contracts which are recognized for any unavoidable net loss arising from the contract as well as employee related provisions other than restructuring. |
ACCOUNTING ESTIMATES AND JUDGEMENTS | |||
Provisions require management to assess the best estimate of the future costs needed to settle the present obligation at the reporting date. The actual costs may differ from the estimated costs. |
EUR million | Provisions for restructuring | Provision for warranties | Other provisions | Total |
1\u00a0Jan\u00a02023 | 13.9 | 1.7 | 6.2 | 21.7 |
Translation differences | -0.2 | 0.0 | -0.1 | -0.3 |
Increases in provisions | 24.2 | 0.7 | 6.2 | 31.1 |
Use of provisions | -25.4 | -0.7 | -6.7 | -32.7 |
Reversals and changes in estimates | -0.5 | -0.5 | -1.5 | -2.6 |
31\u00a0Dec 2023 | 12.0 | 1.2 | 4.0 | 17.2 |
of which | ||||
Non-current | 0.5 | 0.1 | 1.9 | 2.5 |
Current | 11.5 | 1.0 | 2.2 | 14.6 |
Total | 12.0 | 1.2 | 4.0 | 17.2 |
EUR million | Provisions for restructuring | Provision for warranties | Other provisions | Total |
1\u00a0Jan\u00a02022 | 11.3 | 1.6 | 9.5 | 22.4 |
Translation differences | -0.7 | -0.0 | -0.3 | -1.0 |
Increases in provisions | 33.4 | 1.3 | 2.9 | 37.6 |
Use of provisions | -21.7 | -0.3 | -4.5 | -26.4 |
Reversals and changes in estimates | -8.5 | -0.9 | -1.4 | -10.8 |
31\u00a0Dec\u00a02022 | 13.9 | 1.7 | 6.2 | 21.7 |
of which | ||||
Non-current | 0.6 | 0.1 | 1.9 | 2.6 |
Current | 13.3 | 1.6 | 4.3 | 19.1 |
Total | 13.9 | 1.7 | 6.2 | 21.7 |
ACCOUNTING POLICIES | |||
A provision is a liability of uncertain timing or amount which is recognized when the entity has a present legal or constructive obligation as a result of a past event and it is more likely than not that an outflow of economic benefits will be required to settle the obligation and the amount of the obligation can be measured reliably. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation and are split between amounts expected to be settled within 12 months at the end of the reporting period and amounts expected to be settled later (non-current). | |||
Provisions for restructuring | |||
A restructuring provision is only recognized when a formal plan has been approved and the implementation of it has either commenced or the plan has been announced. | |||
Provisions for warranties | |||
The Group's warranties provide assurance that the delivery will function as expected and in accordance with contract specifications. Provisions related to these assurance-type warranties are recognized during the project and used during the warranty period. | |||
Other provisions | |||
Other provisions include provisions for loss making contracts which are recognized for any unavoidable net loss arising from the contract as well as employee related provisions other than restructuring. |
ACCOUNTING POLICIES | |||
Trade and other payables are presented as current liabilities if settlement is due within 12 months from the end of the reporting period. They are recognized at their fair value and subsequently measured at amortized cost using the effective interest method. | |||
The carrying amount of the trade and other payables approximate their fair values due to their short- term nature. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Non-current | ||
Contract liabilities | 6.8 | 16.9 |
Accruals | 4.1 | 4.2 |
Total | 10.8 | 21.0 |
Current | ||
Trade payables | 206.9 | 233.9 |
Contract liabilities | 77.3 | 67.2 |
Accrued liabilities | ||
Employee-related accruals | 197.7 | 193.2 |
Interest | 28.8 | 4.3 |
Other accrued expenses | 42.2 | 32.7 |
Value added tax liabilities | 52.5 | 54.5 |
Payroll tax liabilities | 30.7 | 30.9 |
Total | 636.0 | 616.7 |
ACCOUNTING POLICIES | |||
Trade and other payables are presented as current liabilities if settlement is due within 12 months from the end of the reporting period. They are recognized at their fair value and subsequently measured at amortized cost using the effective interest method. | |||
The carrying amount of the trade and other payables approximate their fair values due to their short- term nature. |
EUR million | Loans and Cash | Estimated cash flows | Leases | Total foreign exchange exposure | External foreign exchange hedges | Transaction exposure sensitivity1) | Foreign exchange hedge sensitivity1) | Net effect gain/(loss) |
SEK | ||||||||
31\u00a0Dec 2023 | -130.6 | 23.1 | \u2014 | -107.5 | 107.7 | 13.1 | -10.8 | 2.3 |
31\u00a0Dec\u00a02022 | -96.2 | 24.0 | \u2014 | -72.2 | 72.7 | 9.6 | -7.3 | 2.3 |
NOK | ||||||||
31\u00a0Dec 2023 | -42.3 | 12.7 | \u2014 | -29.6 | 29.3 | 4.2 | -2.9 | 1.3 |
31\u00a0Dec\u00a02022 | -25.5 | 16.8 | \u2014 | -8.7 | 5.0 | 2.6 | -0.5 | 2.1 |
PLN | ||||||||
31\u00a0Dec 2023 | 0.7 | -9.6 | 1.2 | -7.7 | 8.5 | -0.2 | -0.8 | -1.0 |
31\u00a0Dec\u00a02022 | -1.1 | -23.6 | 1.4 | -23.3 | 23.5 | \u2014 | -2.4 | -2.4 |
CZK | ||||||||
31\u00a0Dec 2023 | -9.6 | -44.3 | 9.6 | -44.3 | 53.4 | \u2014 | -5.3 | -5.3 |
31\u00a0Dec\u00a02022 | -1.6 | -52.6 | 2.6 | -51.6 | 54.2 | -0.1 | -5.4 | -5.5 |
INR | ||||||||
31\u00a0Dec 2023 | \u2014 | -22.5 | \u2014 | -22.5 | 23.0 | \u2014 | -2.3 | -2.3 |
31\u00a0Dec\u00a02022 | \u2014 | -34.9 | \u2014 | -34.9 | 34.7 | \u2014 | -3.5 | -3.5 |
USD | ||||||||
31\u00a0Dec 2023 | 2.2 | \u2014 | -0.1 | 2.1 | -2.3 | -0.2 | 0.2 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | 2.8 | \u2014 | 1.7 | -3.0 | 0.1 | 0.3 | 0.4 |
Other | ||||||||
31\u00a0Dec 2023 | -2.2 | \u2014 | 2.0 | -0.2 | \u2014 | \u2014 | \u2014 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | \u2014 | \u2014 | -1.1 | \u2014 | 0.1 | \u2014 | 0.1 |
31\u00a0Dec\u00a02023 EUR million | Amount | Average rate, % | Rate sensitivity1) |
Capital markets2) | -465.3 | 2.2 | -0.7 |
Money markets | 216.2 | 0.7 | 0.2 |
Other loans | -483.1 | 4.8 | -4.3 |
Other receivables | 28.9 | 3.9 | \u2014 |
Leasing | -209.5 | 6.0 | -2.1 |
31\u00a0Dec\u00a02022 EUR million | Amount | Average rate, % | Rate sensitivity1) |
Capital markets2) | -398.4 | 1.8 | \u2014 |
Money markets | 244.6 | 0.4 | 0.1 |
Other loans | -348.0 | 2.9 | -3.2 |
Other receivables | 28.0 | 3.1 | \u2014 |
Leasing | -207.4 | 6.0 | 2.1 |
31\u00a0Dec 2023 | Amount drawn | Amount available | Maturity structure | ||||||
EUR million | 2024 | 2025 | 2026 | 2027 | 2028 | 2029\u2013 | |||
Loans | Bonds | 400.0 | \u2014 | 100.0 | 300.0 | \u2014 | \u2014 | \u2014 | \u2014 |
Commercial paper programme | 67.0 | \u2014 | 67.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Revolving credit facility | \u2014 | 250.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Liabilities towards joint ventures | 3.0 | \u2014 | 3.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
European Investment Bank | 52.3 | \u2014 | 13.1 | 13.1 | 13.1 | 13.1 | \u2014 | \u2014 | |
OP Corporate Bank | 174.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | 174.0 | \u2014 | |
Syndicated term loan | 208.3 | \u2014 | 208.3 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Other loans | 49.4 | \u2014 | 21.0 | 17.0 | 10.1 | 1.2 | \u2014 | \u2014 | |
954.1 | 250.0 | 412.5 | 330.1 | 23.2 | 14.3 | 174.0 | \u2014 | ||
Interest payments | \u2014 | \u2014 | 27.3 | 16.9 | 9.7 | 8.7 | 8.8 | \u2014 | |
Trade payables | Outflow | 206.9 | \u2014 | 206.9 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Other liabilities | Lease liabilities1) | 248.2 | \u2014 | 59.5 | 46.0 | 33.3 | 25.8 | 23.7 | 59.8 |
Total | 1\u00a0409.1 | 250.0 | 706.1 | 393.0 | 66.2 | 48.8 | 206.5 | 59.8 |
31\u00a0Dec\u00a02022 | Amount drawn | Amount available | Maturity structure | ||||||
EUR million | 2023 | 2024 | 2025 | 2026 | 2027 | 2028\u2013 | |||
Loans | Bond | 400.0 | \u2014 | \u2014 | 100.0 | 300.0 | \u2014 | \u2014 | \u2014 |
Commercial paper programme | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Revolving credit facility | \u2014 | 250.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Liabilities towards joint ventures | 3.5 | \u2014 | 3.5 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
European Investment Bank | 65.4 | \u2014 | 13.1 | 13.1 | 13.1 | 13.1 | 13.1 | \u2014 | |
Syndicated term loan | 254.2 | \u2014 | 80.0 | 174.2 | \u2014 | \u2014 | \u2014 | \u2014 | |
Other loans | 28.7 | \u2014 | 14.1 | 8.6 | 4.7 | 1.2 | 0.1 | \u2014 | |
751.8 | 250.0 | 110.7 | 295.9 | 317.7 | 14.2 | 13.2 | \u2014 | ||
Interest payments | \u2014 | \u2014 | 17.1 | 13.2 | 7.5 | 1.0 | 0.5 | \u2014 | |
Trade payables | Outflow | 233.9 | \u2014 | 233.9 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Other liabilities | Lease liabilities | 241.2 | \u2014 | 61.8 | 47.1 | 32.7 | 23.7 | 19.1 | 56.8 |
Total | 1\u00a0226.9 | 250.0 | 423.4 | 356.2 | 357.9 | 38.9 | 32.8 | 56.8 |
31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | |
Net debt | 911.8 | 679.1 |
12 months EBITDA | 412.8 | 449.0 |
Net debt/EBITDA | 2.2 | 1.5 |
EUR million | Loans and Cash | Estimated cash flows | Leases | Total foreign exchange exposure | External foreign exchange hedges | Transaction exposure sensitivity1) | Foreign exchange hedge sensitivity1) | Net effect gain/(loss) |
SEK | ||||||||
31\u00a0Dec 2023 | -130.6 | 23.1 | \u2014 | -107.5 | 107.7 | 13.1 | -10.8 | 2.3 |
31\u00a0Dec\u00a02022 | -96.2 | 24.0 | \u2014 | -72.2 | 72.7 | 9.6 | -7.3 | 2.3 |
NOK | ||||||||
31\u00a0Dec 2023 | -42.3 | 12.7 | \u2014 | -29.6 | 29.3 | 4.2 | -2.9 | 1.3 |
31\u00a0Dec\u00a02022 | -25.5 | 16.8 | \u2014 | -8.7 | 5.0 | 2.6 | -0.5 | 2.1 |
PLN | ||||||||
31\u00a0Dec 2023 | 0.7 | -9.6 | 1.2 | -7.7 | 8.5 | -0.2 | -0.8 | -1.0 |
31\u00a0Dec\u00a02022 | -1.1 | -23.6 | 1.4 | -23.3 | 23.5 | \u2014 | -2.4 | -2.4 |
CZK | ||||||||
31\u00a0Dec 2023 | -9.6 | -44.3 | 9.6 | -44.3 | 53.4 | \u2014 | -5.3 | -5.3 |
31\u00a0Dec\u00a02022 | -1.6 | -52.6 | 2.6 | -51.6 | 54.2 | -0.1 | -5.4 | -5.5 |
INR | ||||||||
31\u00a0Dec 2023 | \u2014 | -22.5 | \u2014 | -22.5 | 23.0 | \u2014 | -2.3 | -2.3 |
31\u00a0Dec\u00a02022 | \u2014 | -34.9 | \u2014 | -34.9 | 34.7 | \u2014 | -3.5 | -3.5 |
USD | ||||||||
31\u00a0Dec 2023 | 2.2 | \u2014 | -0.1 | 2.1 | -2.3 | -0.2 | 0.2 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | 2.8 | \u2014 | 1.7 | -3.0 | 0.1 | 0.3 | 0.4 |
Other | ||||||||
31\u00a0Dec 2023 | -2.2 | \u2014 | 2.0 | -0.2 | \u2014 | \u2014 | \u2014 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | \u2014 | \u2014 | -1.1 | \u2014 | 0.1 | \u2014 | 0.1 |
EUR million | Loans and Cash | Estimated cash flows | Leases | Total foreign exchange exposure | External foreign exchange hedges | Transaction exposure sensitivity1) | Foreign exchange hedge sensitivity1) | Net effect gain/(loss) |
SEK | ||||||||
31\u00a0Dec 2023 | -130.6 | 23.1 | \u2014 | -107.5 | 107.7 | 13.1 | -10.8 | 2.3 |
31\u00a0Dec\u00a02022 | -96.2 | 24.0 | \u2014 | -72.2 | 72.7 | 9.6 | -7.3 | 2.3 |
NOK | ||||||||
31\u00a0Dec 2023 | -42.3 | 12.7 | \u2014 | -29.6 | 29.3 | 4.2 | -2.9 | 1.3 |
31\u00a0Dec\u00a02022 | -25.5 | 16.8 | \u2014 | -8.7 | 5.0 | 2.6 | -0.5 | 2.1 |
PLN | ||||||||
31\u00a0Dec 2023 | 0.7 | -9.6 | 1.2 | -7.7 | 8.5 | -0.2 | -0.8 | -1.0 |
31\u00a0Dec\u00a02022 | -1.1 | -23.6 | 1.4 | -23.3 | 23.5 | \u2014 | -2.4 | -2.4 |
CZK | ||||||||
31\u00a0Dec 2023 | -9.6 | -44.3 | 9.6 | -44.3 | 53.4 | \u2014 | -5.3 | -5.3 |
31\u00a0Dec\u00a02022 | -1.6 | -52.6 | 2.6 | -51.6 | 54.2 | -0.1 | -5.4 | -5.5 |
INR | ||||||||
31\u00a0Dec 2023 | \u2014 | -22.5 | \u2014 | -22.5 | 23.0 | \u2014 | -2.3 | -2.3 |
31\u00a0Dec\u00a02022 | \u2014 | -34.9 | \u2014 | -34.9 | 34.7 | \u2014 | -3.5 | -3.5 |
USD | ||||||||
31\u00a0Dec 2023 | 2.2 | \u2014 | -0.1 | 2.1 | -2.3 | -0.2 | 0.2 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | 2.8 | \u2014 | 1.7 | -3.0 | 0.1 | 0.3 | 0.4 |
Other | ||||||||
31\u00a0Dec 2023 | -2.2 | \u2014 | 2.0 | -0.2 | \u2014 | \u2014 | \u2014 | \u2014 |
31\u00a0Dec\u00a02022 | -1.1 | \u2014 | \u2014 | -1.1 | \u2014 | 0.1 | \u2014 | 0.1 |
31\u00a0Dec\u00a02023 EUR million | Amount | Average rate, % | Rate sensitivity1) |
Capital markets2) | -465.3 | 2.2 | -0.7 |
Money markets | 216.2 | 0.7 | 0.2 |
Other loans | -483.1 | 4.8 | -4.3 |
Other receivables | 28.9 | 3.9 | \u2014 |
Leasing | -209.5 | 6.0 | -2.1 |
31\u00a0Dec\u00a02022 EUR million | Amount | Average rate, % | Rate sensitivity1) |
Capital markets2) | -398.4 | 1.8 | \u2014 |
Money markets | 244.6 | 0.4 | 0.1 |
Other loans | -348.0 | 2.9 | -3.2 |
Other receivables | 28.0 | 3.1 | \u2014 |
Leasing | -207.4 | 6.0 | 2.1 |
31\u00a0Dec 2023 | Amount drawn | Amount available | Maturity structure | ||||||
EUR million | 2024 | 2025 | 2026 | 2027 | 2028 | 2029\u2013 | |||
Loans | Bonds | 400.0 | \u2014 | 100.0 | 300.0 | \u2014 | \u2014 | \u2014 | \u2014 |
Commercial paper programme | 67.0 | \u2014 | 67.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Revolving credit facility | \u2014 | 250.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Liabilities towards joint ventures | 3.0 | \u2014 | 3.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
European Investment Bank | 52.3 | \u2014 | 13.1 | 13.1 | 13.1 | 13.1 | \u2014 | \u2014 | |
OP Corporate Bank | 174.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | 174.0 | \u2014 | |
Syndicated term loan | 208.3 | \u2014 | 208.3 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Other loans | 49.4 | \u2014 | 21.0 | 17.0 | 10.1 | 1.2 | \u2014 | \u2014 | |
954.1 | 250.0 | 412.5 | 330.1 | 23.2 | 14.3 | 174.0 | \u2014 | ||
Interest payments | \u2014 | \u2014 | 27.3 | 16.9 | 9.7 | 8.7 | 8.8 | \u2014 | |
Trade payables | Outflow | 206.9 | \u2014 | 206.9 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Other liabilities | Lease liabilities1) | 248.2 | \u2014 | 59.5 | 46.0 | 33.3 | 25.8 | 23.7 | 59.8 |
Total | 1\u00a0409.1 | 250.0 | 706.1 | 393.0 | 66.2 | 48.8 | 206.5 | 59.8 |
31\u00a0Dec\u00a02022 | Amount drawn | Amount available | Maturity structure | ||||||
EUR million | 2023 | 2024 | 2025 | 2026 | 2027 | 2028\u2013 | |||
Loans | Bond | 400.0 | \u2014 | \u2014 | 100.0 | 300.0 | \u2014 | \u2014 | \u2014 |
Commercial paper programme | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Revolving credit facility | \u2014 | 250.0 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
Liabilities towards joint ventures | 3.5 | \u2014 | 3.5 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 | |
European Investment Bank | 65.4 | \u2014 | 13.1 | 13.1 | 13.1 | 13.1 | 13.1 | \u2014 | |
Syndicated term loan | 254.2 | \u2014 | 80.0 | 174.2 | \u2014 | \u2014 | \u2014 | \u2014 | |
Other loans | 28.7 | \u2014 | 14.1 | 8.6 | 4.7 | 1.2 | 0.1 | \u2014 | |
751.8 | 250.0 | 110.7 | 295.9 | 317.7 | 14.2 | 13.2 | \u2014 | ||
Interest payments | \u2014 | \u2014 | 17.1 | 13.2 | 7.5 | 1.0 | 0.5 | \u2014 | |
Trade payables | Outflow | 233.9 | \u2014 | 233.9 | \u2014 | \u2014 | \u2014 | \u2014 | \u2014 |
Other liabilities | Lease liabilities | 241.2 | \u2014 | 61.8 | 47.1 | 32.7 | 23.7 | 19.1 | 56.8 |
Total | 1\u00a0226.9 | 250.0 | 423.4 | 356.2 | 357.9 | 38.9 | 32.8 | 56.8 |
31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | |
Net debt | 911.8 | 679.1 |
12 months EBITDA | 412.8 | 449.0 |
Net debt/EBITDA | 2.2 | 1.5 |
31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | |
Net debt | 911.8 | 679.1 |
12 months EBITDA | 412.8 | 449.0 |
Net debt/EBITDA | 2.2 | 1.5 |
ACCOUNTING POLICIES | |||
Interest-bearing loans and borrowings are initially recognized at fair value, net of transaction costs which are recognized in the income statement as interest expenses over the loan term. Debt is classified as short term if it is payable within 12 months, otherwise it is classified as non-current. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Non-current | ||
Bonds | 298.8 | 398.4 |
Other loans | 240.8 | 241.0 |
Lease liabilities | 161.4 | 155.9 |
Total | 701.0 | 795.3 |
Current | ||
Bonds | 100.4 | 0.0 |
Other loans | 308.5 | 107.1 |
Cash pool liabilities towards joint ventures | 3.0 | 3.5 |
Lease liabilities | 50.3 | 54.1 |
Total | 462.2 | 164.7 |
Total Interest bearing loans and borrowings | 1\u00a0163.2 | 960.1 |
Non-cash changes | |||||||||
EUR million | 31\u00a0Dec\u00a02022 | Cash flows | Foreign exchange gains and losses | Reclassification | Acquisitions and disposals | New lease contracts | De-recognized contracts | Other | 31\u00a0Dec 2023 |
Non-current interest-bearing loans | 639.4 | 114.5 | \u2014 | -229.5 | \u2014 | 14.9 | \u2014 | 0.3 | 539.5 |
Current interest-bearing loans | 110.6 | 63.9 | \u2014 | 229.5 | \u2014 | 7.0 | \u2014 | 0.9 | 411.9 |
Lease liabilities | 210.0 | -58.1 | -5.7 | \u2014 | 2.2 | 79.5 | -17.3 | 1.0 | 211.7 |
Total | 960.1 | 120.2 | -5.7 | \u2014 | 2.2 | 101.4 | -17.3 | 2.2 | 1\u00a0163.2 |
Non-cash changes | |||||||||
EUR million | 31\u00a0Dec\u00a02021 | Cash flows | Foreign exchange gains and losses | Reclassification | Acquisitions and disposals | New lease contracts | De-recognized contracts | Other | 31\u00a0Dec\u00a02022 |
Non-current interest-bearing loans | 731.6 | -13.1 | \u2014 | -80.0 | \u2014 | -0.3 | \u2014 | 1.2 | 639.4 |
Current interest-bearing loans | 31.5 | -1.5 | \u2014 | 80.0 | \u2014 | 0.7 | \u2014 | \u2014 | 110.6 |
Lease liabilities | 206.5 | -66.3 | -7.9 | \u2014 | -0.1 | 104.7 | -27.0 | 0.2 | 210.0 |
Total | 969.6 | -81.0 | -7.9 | \u2014 | -0.1 | 105.0 | -27.0 | 1.4 | 960.1 |
ACCOUNTING POLICIES | |||
Interest-bearing loans and borrowings are initially recognized at fair value, net of transaction costs which are recognized in the income statement as interest expenses over the loan term. Debt is classified as short term if it is payable within 12 months, otherwise it is classified as non-current. |
ACCOUNTING POLICIES | |||
Interest-bearing loans and borrowings are initially recognized at fair value, net of transaction costs which are recognized in the income statement as interest expenses over the loan term. Debt is classified as short term if it is payable within 12 months, otherwise it is classified as non-current. |
2023 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | 4.2 | \u2014 | \u2014 | 4.2 |
Financial assets at amortized cost | 23.5 | -21.0 | -1.0 | 0.3 | \u2014 | 1.7 |
Financial liabilities measured at amortized cost | \u2014 | -36.3 | \u2014 | \u2014 | -4.1 | -40.4 |
Net defined benefit obligation | \u2014 | -0.3 | \u2014 | \u2014 | \u2014 | -0.3 |
Total | 23.5 | -57.6 | 3.1 | 0.3 | -4.1 | -34.9 |
2022 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | -7.8 | \u2014 | \u2014 | -7.8 |
Financial assets at amortized cost | 3.6 | \u2014 | 6.4 | 0.3 | \u2014 | 10.3 |
Financial liabilities measured at amortized cost | \u2014 | -22.6 | \u2014 | \u2014 | -3.4 | -25.9 |
Net defined benefit obligation | \u2014 | -0.2 | \u2014 | \u2014 | \u2014 | -0.2 |
Total | 3.6 | -22.8 | -1.4 | 0.3 | -3.4 | -23.7 |
2023 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | 4.2 | \u2014 | \u2014 | 4.2 |
Financial assets at amortized cost | 23.5 | -21.0 | -1.0 | 0.3 | \u2014 | 1.7 |
Financial liabilities measured at amortized cost | \u2014 | -36.3 | \u2014 | \u2014 | -4.1 | -40.4 |
Net defined benefit obligation | \u2014 | -0.3 | \u2014 | \u2014 | \u2014 | -0.3 |
Total | 23.5 | -57.6 | 3.1 | 0.3 | -4.1 | -34.9 |
2022 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | -7.8 | \u2014 | \u2014 | -7.8 |
Financial assets at amortized cost | 3.6 | \u2014 | 6.4 | 0.3 | \u2014 | 10.3 |
Financial liabilities measured at amortized cost | \u2014 | -22.6 | \u2014 | \u2014 | -3.4 | -25.9 |
Net defined benefit obligation | \u2014 | -0.2 | \u2014 | \u2014 | \u2014 | -0.2 |
Total | 3.6 | -22.8 | -1.4 | 0.3 | -3.4 | -23.7 |
2023 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | 4.2 | \u2014 | \u2014 | 4.2 |
Financial assets at amortized cost | 23.5 | -21.0 | -1.0 | 0.3 | \u2014 | 1.7 |
Financial liabilities measured at amortized cost | \u2014 | -36.3 | \u2014 | \u2014 | -4.1 | -40.4 |
Net defined benefit obligation | \u2014 | -0.3 | \u2014 | \u2014 | \u2014 | -0.3 |
Total | 23.5 | -57.6 | 3.1 | 0.3 | -4.1 | -34.9 |
2022 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | -7.8 | \u2014 | \u2014 | -7.8 |
Financial assets at amortized cost | 3.6 | \u2014 | 6.4 | 0.3 | \u2014 | 10.3 |
Financial liabilities measured at amortized cost | \u2014 | -22.6 | \u2014 | \u2014 | -3.4 | -25.9 |
Net defined benefit obligation | \u2014 | -0.2 | \u2014 | \u2014 | \u2014 | -0.2 |
Total | 3.6 | -22.8 | -1.4 | 0.3 | -3.4 | -23.7 |
2023 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | 4.2 | \u2014 | \u2014 | 4.2 |
Financial assets at amortized cost | 23.5 | -21.0 | -1.0 | 0.3 | \u2014 | 1.7 |
Financial liabilities measured at amortized cost | \u2014 | -36.3 | \u2014 | \u2014 | -4.1 | -40.4 |
Net defined benefit obligation | \u2014 | -0.3 | \u2014 | \u2014 | \u2014 | -0.3 |
Total | 23.5 | -57.6 | 3.1 | 0.3 | -4.1 | -34.9 |
2022 | Interest income | Interest expenses | Foreign exchange gains and losses | Other financial income | Other financial expenses | Total |
EUR million | ||||||
Financial assets at fair value through profit or loss | \u2014 | \u2014 | -7.8 | \u2014 | \u2014 | -7.8 |
Financial assets at amortized cost | 3.6 | \u2014 | 6.4 | 0.3 | \u2014 | 10.3 |
Financial liabilities measured at amortized cost | \u2014 | -22.6 | \u2014 | \u2014 | -3.4 | -25.9 |
Net defined benefit obligation | \u2014 | -0.2 | \u2014 | \u2014 | \u2014 | -0.2 |
Total | 3.6 | -22.8 | -1.4 | 0.3 | -3.4 | -23.7 |
ACCOUNTING POLICIES | |||
All financial assets and liabilities are initially recognized at fair value, and subsequently classified either as financial assets at amortized cost or financial assets through profit or loss. | |||
Financial assets at amortized cost | |||
Financial assets are accounted at amortized cost only when the asset is held within a business model with the objective to collect contractual cash flows, which are solely payments of principal and interest. | |||
This category of financial assets includes trade and other receivables, cash and cash equivalents, lease receivables and other interest-bearing receivables. | |||
Financial assets in this category are carried at amortized cost in accordance with the effective interest method with interest income recognized in profit or loss under financial items, see note 20. | |||
Financial liabilities at amortized cost | |||
Financial liabilities in this category are initially recognized at fair value, net of transaction costs directly associated with the borrowing. For interest-bearing liabilities, after initial recognition, liabilities are measured using the effective interest rate method, taking into account any issue costs and any discount or premium on settlement. The related interest expenses are recognized in profit or | |||
Financial assets and liabilities at fair value through profit or loss | |||
Financial assets and liabilities in this category are recognized on the statement of financial position at their fair value with gains or losses resulting from changes in the fair value, being recognized in the income statement. | |||
This category consists mainly of derivatives. Gains or losses from the revaluation of derivative contracts that relate to financial items (loans, cash, leases) are presented as financing costs, see note 20, whereas gains or losses from derivatives, mainly currency forward contracts that relate to operating activities, are included in operating profit. | |||
Fair value measurement is also applicable to trade receivables sold under non-recourse agreements (for the sale of receivables), which have not yet been de-recognized from the statement of financial position at the reporting date. |
Other investments include unlisted shares, where the cost is considered to be a reasonable approximation of their fair value. | |||
Determination of fair values | |||
The classification of financial assets and liabilities measured at fair value in the statement of financial position is based on three hierarchy levels: \u2022 Level 1: quoted prices in active markets for given or identical assets or liabilities that the entity can access at the measurement date; \u2022 Level 2: inputs that are observable for the asset or liability, either directly or indirectly; \u2022 Level 3: unobservable inputs for the asset or liability. | |||
The carrying amount of all financial assets and liabilities, carried at amortized cost is considered to provide a reasonable approximation of their fair value, due to the short maturity and liquid nature of these items, except for bonds which are traded on an active market. | |||
The fair values of derivatives are determined based on prevailing marked quotes at the reporting date. The fair values of foreign exchange derivatives are calculated according to foreign exchange and interest rates on the closing date. |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial assets at fair value through profit or loss | ||||
Non-current | ||||
Other financial assets at fair value through profit or loss | 0.6 | 0.6 | Level 3 | |
Current | ||||
Trade receivables at fair value through profit or loss | 11.6 | 20.2 | Level 2 | |
Current derivative receivables | 5.8 | 3.4 | Level 2 | |
Financial assets at amortized cost | ||||
Non-current | ||||
Other loan receivables, interest- bearing | 15.1 | 15.0 | Level 2 | |
Lease receivables | \u2014 | 0.2 | Level 2 | |
Current | ||||
Other loan receivables, interest- bearing | 14.4 | 13.6 | Level 2 | |
Lease receivables | 2.2 | 2.4 | Level 2 | |
Trade receivables | 476.8 | 408.9 | Level 2 | |
Accrued interest income | 15.5 | 0.0 | Level 2 | |
Cash and cash equivalents | 219.6 | 249.7 | Level 2 | |
Total | 761.7 | 714.1 |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial liabilities at fair value through profit or loss | ||||
Current derivative liabilities | 4.9 | 2.0 | Level 2 | |
Financial liabilities measured at amortized cost | ||||
Non-current | ||||
Lease liability | 161.4 | 155.9 | Level 2 | |
Bonds1) | 298.8 | 398.4 | Level 1 | |
Other loans | 240.8 | 241.0 | Level 2 | |
Current | ||||
Trade payables | 206.9 | 233.9 | Level 2 | |
Accrued interest | 28.8 | 4.3 | Level 2 | |
Lease liability | 50.3 | 54.1 | Level 2 | |
Bonds1) | 100.4 | \u2014 | Level 1 | |
Loans | 311.6 | 110.6 | Level 2 | |
Total | 1\u00a0403.7 | 1\u00a0200.3 |
ACCOUNTING POLICIES | |||
All financial assets and liabilities are initially recognized at fair value, and subsequently classified either as financial assets at amortized cost or financial assets through profit or loss. | |||
Financial assets at amortized cost | |||
Financial assets are accounted at amortized cost only when the asset is held within a business model with the objective to collect contractual cash flows, which are solely payments of principal and interest. | |||
This category of financial assets includes trade and other receivables, cash and cash equivalents, lease receivables and other interest-bearing receivables. | |||
Financial assets in this category are carried at amortized cost in accordance with the effective interest method with interest income recognized in profit or loss under financial items, see note 20. | |||
Financial liabilities at amortized cost | |||
Financial liabilities in this category are initially recognized at fair value, net of transaction costs directly associated with the borrowing. For interest-bearing liabilities, after initial recognition, liabilities are measured using the effective interest rate method, taking into account any issue costs and any discount or premium on settlement. The related interest expenses are recognized in profit or | |||
Financial assets and liabilities at fair value through profit or loss | |||
Financial assets and liabilities in this category are recognized on the statement of financial position at their fair value with gains or losses resulting from changes in the fair value, being recognized in the income statement. | |||
This category consists mainly of derivatives. Gains or losses from the revaluation of derivative contracts that relate to financial items (loans, cash, leases) are presented as financing costs, see note 20, whereas gains or losses from derivatives, mainly currency forward contracts that relate to operating activities, are included in operating profit. | |||
Fair value measurement is also applicable to trade receivables sold under non-recourse agreements (for the sale of receivables), which have not yet been de-recognized from the statement of financial position at the reporting date. |
Other investments include unlisted shares, where the cost is considered to be a reasonable approximation of their fair value. | |||
Determination of fair values | |||
The classification of financial assets and liabilities measured at fair value in the statement of financial position is based on three hierarchy levels: \u2022 Level 1: quoted prices in active markets for given or identical assets or liabilities that the entity can access at the measurement date; \u2022 Level 2: inputs that are observable for the asset or liability, either directly or indirectly; \u2022 Level 3: unobservable inputs for the asset or liability. | |||
The carrying amount of all financial assets and liabilities, carried at amortized cost is considered to provide a reasonable approximation of their fair value, due to the short maturity and liquid nature of these items, except for bonds which are traded on an active market. | |||
The fair values of derivatives are determined based on prevailing marked quotes at the reporting date. The fair values of foreign exchange derivatives are calculated according to foreign exchange and interest rates on the closing date. |
ACCOUNTING POLICIES | |||
All financial assets and liabilities are initially recognized at fair value, and subsequently classified either as financial assets at amortized cost or financial assets through profit or loss. | |||
Financial assets at amortized cost | |||
Financial assets are accounted at amortized cost only when the asset is held within a business model with the objective to collect contractual cash flows, which are solely payments of principal and interest. | |||
This category of financial assets includes trade and other receivables, cash and cash equivalents, lease receivables and other interest-bearing receivables. | |||
Financial assets in this category are carried at amortized cost in accordance with the effective interest method with interest income recognized in profit or loss under financial items, see note 20. | |||
Financial liabilities at amortized cost | |||
Financial liabilities in this category are initially recognized at fair value, net of transaction costs directly associated with the borrowing. For interest-bearing liabilities, after initial recognition, liabilities are measured using the effective interest rate method, taking into account any issue costs and any discount or premium on settlement. The related interest expenses are recognized in profit or | |||
Financial assets and liabilities at fair value through profit or loss | |||
Financial assets and liabilities in this category are recognized on the statement of financial position at their fair value with gains or losses resulting from changes in the fair value, being recognized in the income statement. | |||
This category consists mainly of derivatives. Gains or losses from the revaluation of derivative contracts that relate to financial items (loans, cash, leases) are presented as financing costs, see note 20, whereas gains or losses from derivatives, mainly currency forward contracts that relate to operating activities, are included in operating profit. | |||
Fair value measurement is also applicable to trade receivables sold under non-recourse agreements (for the sale of receivables), which have not yet been de-recognized from the statement of financial position at the reporting date. |
Other investments include unlisted shares, where the cost is considered to be a reasonable approximation of their fair value. | |||
Determination of fair values | |||
The classification of financial assets and liabilities measured at fair value in the statement of financial position is based on three hierarchy levels: \u2022 Level 1: quoted prices in active markets for given or identical assets or liabilities that the entity can access at the measurement date; \u2022 Level 2: inputs that are observable for the asset or liability, either directly or indirectly; \u2022 Level 3: unobservable inputs for the asset or liability. | |||
The carrying amount of all financial assets and liabilities, carried at amortized cost is considered to provide a reasonable approximation of their fair value, due to the short maturity and liquid nature of these items, except for bonds which are traded on an active market. | |||
The fair values of derivatives are determined based on prevailing marked quotes at the reporting date. The fair values of foreign exchange derivatives are calculated according to foreign exchange and interest rates on the closing date. |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial assets at fair value through profit or loss | ||||
Non-current | ||||
Other financial assets at fair value through profit or loss | 0.6 | 0.6 | Level 3 | |
Current | ||||
Trade receivables at fair value through profit or loss | 11.6 | 20.2 | Level 2 | |
Current derivative receivables | 5.8 | 3.4 | Level 2 | |
Financial assets at amortized cost | ||||
Non-current | ||||
Other loan receivables, interest- bearing | 15.1 | 15.0 | Level 2 | |
Lease receivables | \u2014 | 0.2 | Level 2 | |
Current | ||||
Other loan receivables, interest- bearing | 14.4 | 13.6 | Level 2 | |
Lease receivables | 2.2 | 2.4 | Level 2 | |
Trade receivables | 476.8 | 408.9 | Level 2 | |
Accrued interest income | 15.5 | 0.0 | Level 2 | |
Cash and cash equivalents | 219.6 | 249.7 | Level 2 | |
Total | 761.7 | 714.1 |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial liabilities at fair value through profit or loss | ||||
Current derivative liabilities | 4.9 | 2.0 | Level 2 | |
Financial liabilities measured at amortized cost | ||||
Non-current | ||||
Lease liability | 161.4 | 155.9 | Level 2 | |
Bonds1) | 298.8 | 398.4 | Level 1 | |
Other loans | 240.8 | 241.0 | Level 2 | |
Current | ||||
Trade payables | 206.9 | 233.9 | Level 2 | |
Accrued interest | 28.8 | 4.3 | Level 2 | |
Lease liability | 50.3 | 54.1 | Level 2 | |
Bonds1) | 100.4 | \u2014 | Level 1 | |
Loans | 311.6 | 110.6 | Level 2 | |
Total | 1\u00a0403.7 | 1\u00a0200.3 |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial assets at fair value through profit or loss | ||||
Non-current | ||||
Other financial assets at fair value through profit or loss | 0.6 | 0.6 | Level 3 | |
Current | ||||
Trade receivables at fair value through profit or loss | 11.6 | 20.2 | Level 2 | |
Current derivative receivables | 5.8 | 3.4 | Level 2 | |
Financial assets at amortized cost | ||||
Non-current | ||||
Other loan receivables, interest- bearing | 15.1 | 15.0 | Level 2 | |
Lease receivables | \u2014 | 0.2 | Level 2 | |
Current | ||||
Other loan receivables, interest- bearing | 14.4 | 13.6 | Level 2 | |
Lease receivables | 2.2 | 2.4 | Level 2 | |
Trade receivables | 476.8 | 408.9 | Level 2 | |
Accrued interest income | 15.5 | 0.0 | Level 2 | |
Cash and cash equivalents | 219.6 | 249.7 | Level 2 | |
Total | 761.7 | 714.1 |
EUR million | Note | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 | Fair value hierarchy |
Financial liabilities at fair value through profit or loss | ||||
Current derivative liabilities | 4.9 | 2.0 | Level 2 | |
Financial liabilities measured at amortized cost | ||||
Non-current | ||||
Lease liability | 161.4 | 155.9 | Level 2 | |
Bonds1) | 298.8 | 398.4 | Level 1 | |
Other loans | 240.8 | 241.0 | Level 2 | |
Current | ||||
Trade payables | 206.9 | 233.9 | Level 2 | |
Accrued interest | 28.8 | 4.3 | Level 2 | |
Lease liability | 50.3 | 54.1 | Level 2 | |
Bonds1) | 100.4 | \u2014 | Level 1 | |
Loans | 311.6 | 110.6 | Level 2 | |
Total | 1\u00a0403.7 | 1\u00a0200.3 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Foreign exchange forward contracts | 523.9 | 406.5 |
Interest rate swaps | 280.0 | 40.0 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Gross positive fair values, foreign exchange forward contracts | 5.8 | 3.4 |
Gross negative fair values, foreign exchange forward contracts | -4.9 | -2.0 |
Gross positive fair values, interest rate swaps | 15.5 | 2.9 |
Gross negative fair values, interest rate swaps | -20.0 | -2.9 |
The net fair values at the reporting date | -3.6 | 1.4 |
Gross amounts of recognized financial instruments in the statement of financial position1) | Related amounts not set off in the statement of financial position | |||
31\u00a0Dec 2023 | Financial Instruments | Cash collateral received | Net amount | |
EUR million | ||||
Derivative financial assets | ||||
\u00a0 Foreign exchange forward contracts | 5.8 | -3.1 | \u2014 | 2.7 |
\u00a0 Interest rate swaps | 15.5 | -15.5 | \u2014 | \u2014 |
Derivative financial liabilities | ||||
\u00a0 Foreign exchange forward contracts | -4.9 | 3.1 | \u2014 | -1.8 |
\u00a0 Interest rate swaps | -20.0 | 15.5 | \u2014 | -4.6 |
Gross amounts of recognized financial instruments in the statement of financial position1) | Related amounts not set off in the statement of financial position | |||
31\u00a0Dec\u00a02022 | Financial Instruments | Cash collateral received | Net amount | |
EUR million | ||||
Derivative financial assets | ||||
\u00a0 Foreign exchange forward contracts | 3.4 | -1.6 | \u2014 | 1.7 |
\u00a0 Interest rate swaps | 2.9 | -2.9 | \u2014 | \u2014 |
Derivative financial liabilities | ||||
\u00a0 Foreign exchange forward contracts | -2.0 | 1.6 | \u2014 | -0.4 |
\u00a0 Interest rate swaps | -2.9 | 2.9 | \u2014 | \u2014 |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Cash in hand and at bank | 195.7 | 233.4 |
Short-term deposits | 24.0 | 16.3 |
Total | 219.6 | 249.7 |
ACCOUNTING POLICIES | |||
Dividends proposed by the Board of Directors are not deducted from distributable equity until approved by the Annual General Meeting of Shareholders. | |||
When the company's own shares are repurchased, the amount of the consideration paid, including directly attributable costs, is recognized as a deduction in equity. |
EUR million | Number of shares | Share capital | Share issue premiums and other reserves | Invested unrestricted equity reserve | Total |
1\u00a0Jan\u00a02022 | 118\u00a0418\u00a0184 | 76.6 | 41.5 | 1\u00a0203.5 | 1\u00a0321.6 |
Purchase of own shares | -145\u00a0000 | \u2014 | \u2014 | \u2014 | \u2014 |
Shares delivered from the share-based incentive plans1) | 140\u00a0119 | \u2014 | \u2014 | \u2014 | \u2014 |
Translation difference | \u2014 | \u2014 | -2.2 | \u2014 | -2.2 |
31\u00a0Dec\u00a02022 | 118\u00a0413\u00a0303 | 76.6 | 39.3 | 1\u00a0203.5 | 1\u00a0319.4 |
Purchase of own shares | -325\u00a0000 | \u2014 | \u2014 | \u2014 | \u2014 |
Shares delivered from the share-based incentive plans1) | 302\u00a0789 | \u2014 | \u2014 | \u2014 | \u2014 |
Translation difference | \u2014 | \u2014 | 0.1 | \u2014 | 0.1 |
31\u00a0Dec 2023 | 118\u00a0391\u00a0092 | 76.6 | 39.4 | 1\u00a0203.5 | 1\u00a0319.4 |
Own shares2) | 34\u00a0679 | ||||
Total number of shares on 31\u00a0Dec 2023\u00b2\u207e | 118\u00a0425\u00a0771 |
ACCOUNTING POLICIES | |||
Business combinations are accounted for using the acquisition method. Subsidiaries are consolidated from the date on which control is achieved until the date on which control ceases by using the acquisition method. The consideration transferred for the acquisition is the fair values of the assets transferred and the liabilities assumed. Acquisition related costs are recognised as expenses for the period in which they are incurred. | |||
Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The excess of the consideration transferred over the fair value of the identifiable net assets acquired is recognized as goodwill at the acquisition date. If the cost of the acquisition is less than the fair value of the net assets acquired in the case of a bargain purchase, the resulting gain is recognized in profit or loss. | |||
When a disposed operation is part of a cash-generating unit (CGU) to which goodwill has been allocated, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained. | |||
Assets held for sale | |||
Non-current assets are classified as held for sale if their carrying amounts are expected to be recovered principally through sale and the sale is highly probable. From the date of classification, the assets are measured at the lower of the carrying amount and the fair value less costs to sell, and the recognition of depreciation is discontinued. |
EUR million | |
Intangible assets | 22.5 |
Property, plant and equipment | 0.9 |
Right-of-use assets | 2.2 |
Other non-current receivables | 0.2 |
Trade and other receivables | 8.9 |
Cash and cash equivalents | 6.3 |
Non-current lease liabilities | -1.7 |
Deferred tax liabilities | -5.6 |
Trade and other payables | -7.9 |
Current lease liabilities | -0.6 |
Total net assets acquired | 25.3 |
Goodwill | 137.4 |
Total | 162.6 |
Consideration paid in cash | 162.6 |
Cash and cash equivalent balances acquired | -6.3 |
Net cash flow on acquisition | 156.3 |
Company name | Domicile | Parent company's holding % | 31\u00a0Dec 2023 Book value in the Parent company EUR million |
EVRY Card Issuing AS | Norway | 100.0 | 77.4 |
EVRY Card Payments AS | Norway | 100.0 | 0.7 |
EVRY Card Services AS | Norway | 100.0 | 84.0 |
Fellesdata AS | Norway | 100.0 | \u2014 |
Infopulse Brasil Servicos Technologicos Ltda. | Brazil | 1.0 | 0.0 |
Tieto Austria GmbH | Austria | 100.0 | 0.8 |
Tieto (Beijing) Technology Co., Ltd. | China | 100.0 | 0.8 |
Tieto China Co., Ltd. | China | 100.0 | 4.3 |
Tieto Germany GmbH | Germany | 100.0 | 0.5 |
Tieto Global Oy | Finland | 100.0 | 1.1 |
Tieto Great Britain Ltd. | Great Britain | 100.0 | 0.5 |
Tieto Lietuva UAB | Lithuania | 100.0 | 2.6 |
Tieto Netherlands Holding B.V. | Netherlands | 100.0 | 24.5 |
Tieto Poland Sp. z o.o | Poland | 100.0 | 3.3 |
Tieto Support Services Sp. z o.o. | Poland | 100.0 | 0.4 |
Tietoevry 12 Oy (former TietoIlmarinen Oy) | Finland | 100.0 | 0.2 |
Tietoevry AB | Sweden | 100.0 | 667.6 |
TietoEVRY Accounting AS | Norway | 100.0 | 16.7 |
Tietoevry Banking Finland Oy | Finland | 100.0 | 1.3 |
Tietoevry Banking Latvia SIA | Latvia | 100.0 | 12.3 |
Tietoevry Czechia s.r.o. | Czech Republic | 100.0 | 0.5 |
Tietoevry Czechia Support Services s.r.o. | Czech Republic | 100.0 | \u2014 |
Tietoevry Denmark A/S | Denmark | 100.0 | 6.5 |
Tietoevry DK A/S | Denmark | 100.0 | 1.6 |
Tietoevry Estonia AS | Estonia | 100.0 | 0.2 |
Tietoevry Finland Oy | Finland | 100.0 | 71.2 |
Tietoevry Finland Support Services Oy | Finland | 100.0 | 1.2 |
Tietoevry Fintech Estonia O\u00dc | Estonia | 100.0 | 0.1 |
Tietoevry Fintech Norway AS | Norway | 100.0 | 516.1 |
Tietoevry Fintech Sweden AB | Sweden | 100.0 | 52.2 |
Tietoevry Inc. | The United States | 100.0 | 73.7 |
Tietoevry\u00a0 Latvia SIA | Latvia | 100.0 | 2.1 |
Tietoevry Malaysia Sdn. Bhd. | Malaysia | 100.0 | 0.1 |
Tietoevry Norway AS | Norway | 100.0 | 314.9 |
Tietoevry Slovakia s.r.o. | Slovakia | 100.0 | 0.0 |
Tietoevry Tech Services AB | Sweden | 100.0 | 201.9 |
Tietoevry Tech Services Czechia s.r.o. | Czech Republic | 100.0 | 7.5 |
Tietoevry Tech Services Finland Oy | Finland | 100.0 | 64.7 |
Tietoevry Tech Services Latvia SIA | Latvia | 100.0 | 0.8 |
Tietoevry Tech Services Norway AS | Norway | 100.0 | 176.9 |
Tietoevry Tech Services Slovakia s.r.o. | Slovakia | 15.0 | 0.0 |
Dormant subsidiaries (2 in total) | 0.0 | ||
Total | 2\u00a0391.2 |
Company name | Domicile | Group holding % | 31\u00a0Dec 2023 Book value in the Parent company EUR million |
Avega Catalyst AB | Sweden | 100.0 | 0.4 |
Avega Clarity AB | Sweden | 100.0 | 0.8 |
Avega Complius AB | Sweden | 100.0 | 0.0 |
Avega Dinamiko AB | Sweden | 100.0 | 0.1 |
Avega Effectus AB | Sweden | 100.0 | 0.8 |
Avega Group AB | Sweden | 100.0 | 42.4 |
Avega Kipeo AB | Sweden | 100.0 | 1.5 |
Avega Kite AB | Sweden | 100.0 | 0.0 |
Avega Mtoni AB | Sweden | 100.0 | 0.1 |
Avega Nuvem AB | Sweden | 100.0 | 0.0 |
Avega Qurio AB | Sweden | 100.0 | 2.6 |
Avega Scire AB | Sweden | 100.0 | 0.1 |
Avega Sempai AB | Sweden | 100.0 | 0.5 |
Avega Senso AB | Sweden | 100.0 | 0.0 |
Bekk Consulting AS | Norway | 100.0 | 41.5 |
EVRY Card Services AB | Sweden | 100.0 | 24.2 |
EVRY Card Services Oy | Finland | 100.0 | 5.7 |
EVRY Financial Service UK Ltd. | Great Britain | 100.0 | 0.1 |
EVRY India Pvt. Ltd. | India | 100.0 | 13.5 |
EVRY USA Corporation | The United States | 100.0 | 0.4 |
Eye-share AS | Norway | 100.0 | 2.2 |
Eye-share Singapore Pte. Ltd. | Singapore | 100.0 | 0.0 |
Gjeldsregisteret AS | Norway | 100.0 | 0.0 |
Infopulse Brasil Servicos Technologicos Ltda. | Brazil | 99.0 | 0.1 |
Infopulse Bulgaria Ltd. | Bulgaria | 100.0 | 0.1 |
Infopulse Europe GmbH | Germany | 100.0 | 0.0 |
Infopulse Poland Sp. z o.o. | Poland | 100.0 | \u2014 |
Infopulse Ukraine LLC | Ukraine | 100.0 | 0.0 |
MentorMate Bulgaria Ltd. | Bulgaria | 100.0 | 4.6 |
MentorMate Paraguay S.R.L. | Paraguay | 100.0 | 0.4 |
MentorMate, LLC | The United States | 100.0 | 163.7 |
NUK Holding AB | Sweden | 100.0 | 16.9 |
Tieto Ukraine Support Services LLC | Ukraine | 100.0 | 0.8 |
Tieto U.S. Inc. | The United States | 100.0 | 1.1 |
Tietoevry Banking Poland Sp. z o.o. | Poland | 100.0 | 0.0 |
Tietoevry Financing AB | Sweden | 100.0 | 0.0 |
Tietoevry Financing AS | Norway | 100.0 | 1.8 |
Tietoevry FinTech DOO | Serbia | 100.0 | 0.0 |
Tietoevry Fintech India Pvt. Ltd. | India | 100.0 | 9.8 |
Tietoevry\u00a0 India Pvt. Ltd. | India | 100.0 | 21.9 |
Tietoevry Pay Oy | Finland | 100.0 | 0.1 |
Tietoevry Sweden\u00a0 AB | Sweden | 100.0 | 154.5 |
Tietoevry Sweden Support Services AB | Sweden | 100.0 | 0.0 |
Tietoevry Tech Services Estonia O\u00dc | Estonia | 100.0 | 0.0 |
Tietoevry Tech Services India Pvt. Ltd. | India | 100.0 | 13.7 |
Tietoevry Tech Services Lithuania UAB | Lithuania | 100.0 | 0.0 |
Tietoevry Tech Services Slovakia s.r.o. | Slovakia | 85.0 | 0.0 |
Tietoevry Tech Services Sweden AB | Sweden | 100.0 | 6.4 |
Dormant subsidiaries (7 in total) | 0.1 | ||
Total | 533.0 |
ACCOUNTING POLICIES | |||
Companies, where Tietoevry has assumed management responsibility, has contractually based joint control with a third party and has rights to the net assets of the company based on the contractual arrangement are included in the consolidated financial statements as joint ventures. Joint ventures are accounted by using the equity method under which the investments in joint ventures are initially recognized at cost and adjusted thereafter to recognize the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of joint venture\u2019s losses exceeds the carrying amount of the investment, the investment is recognized at zero value in the statement of financial position and the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the joint venture. | |||
Sales to and purchases from joint ventures are made on normal market terms and conditions and at market prices. The Group\u2019s share of the joint ventures\u2019 result for the period is separately disclosed in the income statement. |
Number of shares | Parent company's share % | Voting right % | Carrying value EUR million | |||||
31 Dec | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
Tieto Esy Oy | 7\u00a0300 | 7\u00a0300 | 80.0 | 80.0 | 34.0 | 34.0 | 2.6 | 5.1 |
BuyPass AS | 21\u00a0100 | 21\u00a0100 | 50.0 | 50.0 | 50.0 | 50.0 | 8.9 | 9.2 |
11.6 | 14.2 |
EUR million | 2023 | 2022 |
Carrying value, 1 Jan | 14.2 | 16.7 |
Translation differences | -0.6 | -0.7 |
Share of results | 1.3 | 1.0 |
Dividends received | -1.3 | -1.4 |
Impairments | -2.1 | -1.4 |
Carrying value, 31 Dec | 11.6 | 14.2 |
31\u00a0Dec 2023 | Tieto Esy Oy | BuyPass AS |
EUR million | ||
Non-current assets | 0.0 | 5.6 |
Current assets | 3.3 | 71.2 |
Total | 3.4 | 76.8 |
Non-current liabilities | \u2014 | 0.2 |
Current liabilities | 0.5 | 58.8 |
Total | 0.5 | 59.0 |
Net sales | 2.4 | 29.3 |
Expenses | -2.4 | -26.2 |
Financial items | 0.1 | 0.2 |
Result before taxes | 0.1 | 3.3 |
Income taxes | -0.0 | -0.8 |
Net result for the financial year | 0.1 | 2.5 |
Dividends paid to Tietoevry | 0.4 | 0.9 |
Average full-time personnel during the financial year | 18 | 80 |
31\u00a0Dec\u00a02022 | Tieto Esy Oy | TietoIlmarinen\u00a0Oy | BuyPass AS |
EUR million | |||
Non-current assets | 0.0 | \u2014 | 5.2 |
Current assets | 4.0 | \u2014 | 45.5 |
Total | 4.0 | \u2014 | 50.7 |
Non-current liabilities | \u2014 | \u2014 | \u2014 |
Current liabilities | 0.7 | \u2014 | 32.5 |
Total | 0.7 | \u2014 | 32.5 |
Net sales | 3.9 | 1.6 | 30.7 |
Expenses | -3.2 | -2.4 | -27.9 |
Financial items | \u2014 | \u2014 | 0.1 |
Result before taxes | 0.7 | -0.8 | 2.9 |
Income taxes | -0.2 | 0.0 | -0.7 |
Net result for the financial year | 0.6 | -0.8 | 2.2 |
Dividends paid to Tietoevry | 0.5 | \u2014 | 0.9 |
Average full-time personnel during the financial year1) | 27 | 13 | 77 |
Company name | Domicile | Parent company's holding % | 31\u00a0Dec 2023 Book value in the Parent company EUR million |
EVRY Card Issuing AS | Norway | 100.0 | 77.4 |
EVRY Card Payments AS | Norway | 100.0 | 0.7 |
EVRY Card Services AS | Norway | 100.0 | 84.0 |
Fellesdata AS | Norway | 100.0 | \u2014 |
Infopulse Brasil Servicos Technologicos Ltda. | Brazil | 1.0 | 0.0 |
Tieto Austria GmbH | Austria | 100.0 | 0.8 |
Tieto (Beijing) Technology Co., Ltd. | China | 100.0 | 0.8 |
Tieto China Co., Ltd. | China | 100.0 | 4.3 |
Tieto Germany GmbH | Germany | 100.0 | 0.5 |
Tieto Global Oy | Finland | 100.0 | 1.1 |
Tieto Great Britain Ltd. | Great Britain | 100.0 | 0.5 |
Tieto Lietuva UAB | Lithuania | 100.0 | 2.6 |
Tieto Netherlands Holding B.V. | Netherlands | 100.0 | 24.5 |
Tieto Poland Sp. z o.o | Poland | 100.0 | 3.3 |
Tieto Support Services Sp. z o.o. | Poland | 100.0 | 0.4 |
Tietoevry 12 Oy (former TietoIlmarinen Oy) | Finland | 100.0 | 0.2 |
Tietoevry AB | Sweden | 100.0 | 667.6 |
TietoEVRY Accounting AS | Norway | 100.0 | 16.7 |
Tietoevry Banking Finland Oy | Finland | 100.0 | 1.3 |
Tietoevry Banking Latvia SIA | Latvia | 100.0 | 12.3 |
Tietoevry Czechia s.r.o. | Czech Republic | 100.0 | 0.5 |
Tietoevry Czechia Support Services s.r.o. | Czech Republic | 100.0 | \u2014 |
Tietoevry Denmark A/S | Denmark | 100.0 | 6.5 |
Tietoevry DK A/S | Denmark | 100.0 | 1.6 |
Tietoevry Estonia AS | Estonia | 100.0 | 0.2 |
Tietoevry Finland Oy | Finland | 100.0 | 71.2 |
Tietoevry Finland Support Services Oy | Finland | 100.0 | 1.2 |
Tietoevry Fintech Estonia O\u00dc | Estonia | 100.0 | 0.1 |
Tietoevry Fintech Norway AS | Norway | 100.0 | 516.1 |
Tietoevry Fintech Sweden AB | Sweden | 100.0 | 52.2 |
Tietoevry Inc. | The United States | 100.0 | 73.7 |
Tietoevry\u00a0 Latvia SIA | Latvia | 100.0 | 2.1 |
Tietoevry Malaysia Sdn. Bhd. | Malaysia | 100.0 | 0.1 |
Tietoevry Norway AS | Norway | 100.0 | 314.9 |
Tietoevry Slovakia s.r.o. | Slovakia | 100.0 | 0.0 |
Tietoevry Tech Services AB | Sweden | 100.0 | 201.9 |
Tietoevry Tech Services Czechia s.r.o. | Czech Republic | 100.0 | 7.5 |
Tietoevry Tech Services Finland Oy | Finland | 100.0 | 64.7 |
Tietoevry Tech Services Latvia SIA | Latvia | 100.0 | 0.8 |
Tietoevry Tech Services Norway AS | Norway | 100.0 | 176.9 |
Tietoevry Tech Services Slovakia s.r.o. | Slovakia | 15.0 | 0.0 |
Dormant subsidiaries (2 in total) | 0.0 | ||
Total | 2\u00a0391.2 |
Company name | Domicile | Group holding % | 31\u00a0Dec 2023 Book value in the Parent company EUR million |
Avega Catalyst AB | Sweden | 100.0 | 0.4 |
Avega Clarity AB | Sweden | 100.0 | 0.8 |
Avega Complius AB | Sweden | 100.0 | 0.0 |
Avega Dinamiko AB | Sweden | 100.0 | 0.1 |
Avega Effectus AB | Sweden | 100.0 | 0.8 |
Avega Group AB | Sweden | 100.0 | 42.4 |
Avega Kipeo AB | Sweden | 100.0 | 1.5 |
Avega Kite AB | Sweden | 100.0 | 0.0 |
Avega Mtoni AB | Sweden | 100.0 | 0.1 |
Avega Nuvem AB | Sweden | 100.0 | 0.0 |
Avega Qurio AB | Sweden | 100.0 | 2.6 |
Avega Scire AB | Sweden | 100.0 | 0.1 |
Avega Sempai AB | Sweden | 100.0 | 0.5 |
Avega Senso AB | Sweden | 100.0 | 0.0 |
Bekk Consulting AS | Norway | 100.0 | 41.5 |
EVRY Card Services AB | Sweden | 100.0 | 24.2 |
EVRY Card Services Oy | Finland | 100.0 | 5.7 |
EVRY Financial Service UK Ltd. | Great Britain | 100.0 | 0.1 |
EVRY India Pvt. Ltd. | India | 100.0 | 13.5 |
EVRY USA Corporation | The United States | 100.0 | 0.4 |
Eye-share AS | Norway | 100.0 | 2.2 |
Eye-share Singapore Pte. Ltd. | Singapore | 100.0 | 0.0 |
Gjeldsregisteret AS | Norway | 100.0 | 0.0 |
Infopulse Brasil Servicos Technologicos Ltda. | Brazil | 99.0 | 0.1 |
Infopulse Bulgaria Ltd. | Bulgaria | 100.0 | 0.1 |
Infopulse Europe GmbH | Germany | 100.0 | 0.0 |
Infopulse Poland Sp. z o.o. | Poland | 100.0 | \u2014 |
Infopulse Ukraine LLC | Ukraine | 100.0 | 0.0 |
MentorMate Bulgaria Ltd. | Bulgaria | 100.0 | 4.6 |
MentorMate Paraguay S.R.L. | Paraguay | 100.0 | 0.4 |
MentorMate, LLC | The United States | 100.0 | 163.7 |
NUK Holding AB | Sweden | 100.0 | 16.9 |
Tieto Ukraine Support Services LLC | Ukraine | 100.0 | 0.8 |
Tieto U.S. Inc. | The United States | 100.0 | 1.1 |
Tietoevry Banking Poland Sp. z o.o. | Poland | 100.0 | 0.0 |
Tietoevry Financing AB | Sweden | 100.0 | 0.0 |
Tietoevry Financing AS | Norway | 100.0 | 1.8 |
Tietoevry FinTech DOO | Serbia | 100.0 | 0.0 |
Tietoevry Fintech India Pvt. Ltd. | India | 100.0 | 9.8 |
Tietoevry\u00a0 India Pvt. Ltd. | India | 100.0 | 21.9 |
Tietoevry Pay Oy | Finland | 100.0 | 0.1 |
Tietoevry Sweden\u00a0 AB | Sweden | 100.0 | 154.5 |
Tietoevry Sweden Support Services AB | Sweden | 100.0 | 0.0 |
Tietoevry Tech Services Estonia O\u00dc | Estonia | 100.0 | 0.0 |
Tietoevry Tech Services India Pvt. Ltd. | India | 100.0 | 13.7 |
Tietoevry Tech Services Lithuania UAB | Lithuania | 100.0 | 0.0 |
Tietoevry Tech Services Slovakia s.r.o. | Slovakia | 85.0 | 0.0 |
Tietoevry Tech Services Sweden AB | Sweden | 100.0 | 6.4 |
Dormant subsidiaries (7 in total) | 0.1 | ||
Total | 533.0 |
ACCOUNTING POLICIES | |||
Companies, where Tietoevry has assumed management responsibility, has contractually based joint control with a third party and has rights to the net assets of the company based on the contractual arrangement are included in the consolidated financial statements as joint ventures. Joint ventures are accounted by using the equity method under which the investments in joint ventures are initially recognized at cost and adjusted thereafter to recognize the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of joint venture\u2019s losses exceeds the carrying amount of the investment, the investment is recognized at zero value in the statement of financial position and the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the joint venture. | |||
Sales to and purchases from joint ventures are made on normal market terms and conditions and at market prices. The Group\u2019s share of the joint ventures\u2019 result for the period is separately disclosed in the income statement. |
Number of shares | Parent company's share % | Voting right % | Carrying value EUR million | |||||
31 Dec | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
Tieto Esy Oy | 7\u00a0300 | 7\u00a0300 | 80.0 | 80.0 | 34.0 | 34.0 | 2.6 | 5.1 |
BuyPass AS | 21\u00a0100 | 21\u00a0100 | 50.0 | 50.0 | 50.0 | 50.0 | 8.9 | 9.2 |
11.6 | 14.2 |
EUR million | 2023 | 2022 |
Carrying value, 1 Jan | 14.2 | 16.7 |
Translation differences | -0.6 | -0.7 |
Share of results | 1.3 | 1.0 |
Dividends received | -1.3 | -1.4 |
Impairments | -2.1 | -1.4 |
Carrying value, 31 Dec | 11.6 | 14.2 |
31\u00a0Dec 2023 | Tieto Esy Oy | BuyPass AS |
EUR million | ||
Non-current assets | 0.0 | 5.6 |
Current assets | 3.3 | 71.2 |
Total | 3.4 | 76.8 |
Non-current liabilities | \u2014 | 0.2 |
Current liabilities | 0.5 | 58.8 |
Total | 0.5 | 59.0 |
Net sales | 2.4 | 29.3 |
Expenses | -2.4 | -26.2 |
Financial items | 0.1 | 0.2 |
Result before taxes | 0.1 | 3.3 |
Income taxes | -0.0 | -0.8 |
Net result for the financial year | 0.1 | 2.5 |
Dividends paid to Tietoevry | 0.4 | 0.9 |
Average full-time personnel during the financial year | 18 | 80 |
31\u00a0Dec\u00a02022 | Tieto Esy Oy | TietoIlmarinen\u00a0Oy | BuyPass AS |
EUR million | |||
Non-current assets | 0.0 | \u2014 | 5.2 |
Current assets | 4.0 | \u2014 | 45.5 |
Total | 4.0 | \u2014 | 50.7 |
Non-current liabilities | \u2014 | \u2014 | \u2014 |
Current liabilities | 0.7 | \u2014 | 32.5 |
Total | 0.7 | \u2014 | 32.5 |
Net sales | 3.9 | 1.6 | 30.7 |
Expenses | -3.2 | -2.4 | -27.9 |
Financial items | \u2014 | \u2014 | 0.1 |
Result before taxes | 0.7 | -0.8 | 2.9 |
Income taxes | -0.2 | 0.0 | -0.7 |
Net result for the financial year | 0.6 | -0.8 | 2.2 |
Dividends paid to Tietoevry | 0.5 | \u2014 | 0.9 |
Average full-time personnel during the financial year1) | 27 | 13 | 77 |
ACCOUNTING POLICIES | |||
Companies, where Tietoevry has assumed management responsibility, has contractually based joint control with a third party and has rights to the net assets of the company based on the contractual arrangement are included in the consolidated financial statements as joint ventures. Joint ventures are accounted by using the equity method under which the investments in joint ventures are initially recognized at cost and adjusted thereafter to recognize the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of joint venture\u2019s losses exceeds the carrying amount of the investment, the investment is recognized at zero value in the statement of financial position and the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the joint venture. | |||
Sales to and purchases from joint ventures are made on normal market terms and conditions and at market prices. The Group\u2019s share of the joint ventures\u2019 result for the period is separately disclosed in the income statement. |
Number of shares | Parent company's share % | Voting right % | Carrying value EUR million | |||||
31 Dec | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 |
Tieto Esy Oy | 7\u00a0300 | 7\u00a0300 | 80.0 | 80.0 | 34.0 | 34.0 | 2.6 | 5.1 |
BuyPass AS | 21\u00a0100 | 21\u00a0100 | 50.0 | 50.0 | 50.0 | 50.0 | 8.9 | 9.2 |
11.6 | 14.2 |
EUR million | 2023 | 2022 |
Carrying value, 1 Jan | 14.2 | 16.7 |
Translation differences | -0.6 | -0.7 |
Share of results | 1.3 | 1.0 |
Dividends received | -1.3 | -1.4 |
Impairments | -2.1 | -1.4 |
Carrying value, 31 Dec | 11.6 | 14.2 |
31\u00a0Dec 2023 | Tieto Esy Oy | BuyPass AS |
EUR million | ||
Non-current assets | 0.0 | 5.6 |
Current assets | 3.3 | 71.2 |
Total | 3.4 | 76.8 |
Non-current liabilities | \u2014 | 0.2 |
Current liabilities | 0.5 | 58.8 |
Total | 0.5 | 59.0 |
Net sales | 2.4 | 29.3 |
Expenses | -2.4 | -26.2 |
Financial items | 0.1 | 0.2 |
Result before taxes | 0.1 | 3.3 |
Income taxes | -0.0 | -0.8 |
Net result for the financial year | 0.1 | 2.5 |
Dividends paid to Tietoevry | 0.4 | 0.9 |
Average full-time personnel during the financial year | 18 | 80 |
31\u00a0Dec\u00a02022 | Tieto Esy Oy | TietoIlmarinen\u00a0Oy | BuyPass AS |
EUR million | |||
Non-current assets | 0.0 | \u2014 | 5.2 |
Current assets | 4.0 | \u2014 | 45.5 |
Total | 4.0 | \u2014 | 50.7 |
Non-current liabilities | \u2014 | \u2014 | \u2014 |
Current liabilities | 0.7 | \u2014 | 32.5 |
Total | 0.7 | \u2014 | 32.5 |
Net sales | 3.9 | 1.6 | 30.7 |
Expenses | -3.2 | -2.4 | -27.9 |
Financial items | \u2014 | \u2014 | 0.1 |
Result before taxes | 0.7 | -0.8 | 2.9 |
Income taxes | -0.2 | 0.0 | -0.7 |
Net result for the financial year | 0.6 | -0.8 | 2.2 |
Dividends paid to Tietoevry | 0.5 | \u2014 | 0.9 |
Average full-time personnel during the financial year1) | 27 | 13 | 77 |
ACCOUNTING POLICIES | |||
Companies, where Tietoevry has assumed management responsibility, has contractually based joint control with a third party and has rights to the net assets of the company based on the contractual arrangement are included in the consolidated financial statements as joint ventures. Joint ventures are accounted by using the equity method under which the investments in joint ventures are initially recognized at cost and adjusted thereafter to recognize the Group's share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group's share of joint venture\u2019s losses exceeds the carrying amount of the investment, the investment is recognized at zero value in the statement of financial position and the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the joint venture. | |||
Sales to and purchases from joint ventures are made on normal market terms and conditions and at market prices. The Group\u2019s share of the joint ventures\u2019 result for the period is separately disclosed in the income statement. |
ACCOUNTING POLICIES | |||
Sales to and purchases from related parties are made on normal market terms and conditions and at market prices. There are no commitments or contingencies on behalf of related parties. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
Sales | 1.2 | 2.9 |
Other operating income | 0.6 | 1.3 |
Purchases | 0.6 | 1.3 |
Receivables | 0.1 | 0.1 |
Liabilities including cash pool | 3.1 | 4.1 |
ACCOUNTING POLICIES | |||
Sales to and purchases from related parties are made on normal market terms and conditions and at market prices. There are no commitments or contingencies on behalf of related parties. |
ACCOUNTING POLICIES | |||
Commitments are disclosed when the Group has a contract where the existence of an obligation will be only confirmed in the future. | |||
Contingent liabilities are possible obligations whose existence will be confirmed by uncertain future events that are not wholly within the control of the entity. They can also include obligations that are not recognized in the statement of financial position because settlement is not probable or their amount cannot be measured reliably. |
EUR million | 31\u00a0Dec 2023 | 31\u00a0Dec\u00a02022 |
For Tietoevry obligations | ||
Guarantees | ||
Performance guarantees | 150.6 | 81.7 |
Payment guarantees | 0.6 | 0.5 |
Other | 0.1 | 0.1 |
Other Tietoevry obligations | ||
Lease commitments, not yet commenced | 10.7 | 22.3 |
Other | 0.5 | 0.6 |
On behalf of third parties | ||
Guarantees | ||
Performance guarantees | 23.4 | 23.4 |
ACCOUNTING POLICIES | |||
Commitments are disclosed when the Group has a contract where the existence of an obligation will be only confirmed in the future. | |||
Contingent liabilities are possible obligations whose existence will be confirmed by uncertain future events that are not wholly within the control of the entity. They can also include obligations that are not recognized in the statement of financial position because settlement is not probable or their amount cannot be measured reliably. |