Schuberg Philis

Directors' report

Our broad theme for this review of the past year is 'What's next?' We've experienced a year of considerable agility and change while maintaining our focus on stability. These are important topics for our customers, and for us at Schuberg Philis. We believe it's crucial to be ready for what's coming, together with our most important allies, our customers. In this Annual Report they recount their experience over the past year and share their perspective on the theme 'What's next'.

Responding to developments

The year 2018 marked the beginning in the next phase of our development. There's a clear evolution in the role that we play for our customers. This new role is based on the trust they place in us and our knowledge of what is technologically possible, as well as on our independence. The changes in our organizational structure which were introduced last year gave us greater scalability and focus. This makes it possible to respond actively to changes in customers' requirements, which has led to strong growth in turnover over the past year with existing as well as new customers.

IT Business Partner

Our customers have a great deal of confidence in Schuberg Philis. This year, once again, we were proud to receive the highest trust scores in Giarte's annual outsourcing performance survey. This trust, and the long-term focus in our relationships, provides a strong foundation to build on. It allows us to respond creatively to the increasingly common requests from customers – such as, Argenta and KLM – to think together with them about future plans. Our long-lasting relationships, knowledge of the customer's business, and our track record in achieving innovative mission-critical IT ecosystems make Schuberg Philis a reliable IT Business Partner. This means we are in a good position to help customers with their strategic business initiatives. Our approach to this portfolio expansion – in line with our tradition - is to work together with our customers and partners. Investing in knowledge and expertise

Technical proficiency has been at the core of our services from the very beginning. The rate of change in the implementation of new technologies, business renewal, and innovation demands a clear strategy for knowledge development. In 2018, we invested heavily in organizing our learning capability at a structural level. We have also been building new knowledge in diverse fields such as culture, partnerships, technology, methods, and techniques for exploring strategic options. This is one of the important new foundations for the next phase in our evolution. When recruiting professionals, we have looked not only for expertise but also for people with a talent for ongoing learning.

Labs – applied creativity

The introduction of Schuberg Philis Labs in 2018 brought a strong focus on innovative initiatives conducted in partnership with customers such as Argenta and Enexis. Labs brings knowledge, creativity, and vigorous implementation to the strategic innovation we implement with our customers. The establishment of Labs led directly to more proof-of-concept projects and applied experiments. The combination of industry-specific knowledge in the Customer Teams and the innovative power of Labs ensures that the initiatives we take are both inspiring and relevant. The past year has shown that having Labs is also very valuable for attracting new talent.

Girlsday 2018

Public Cloud and its adoption for business-critical purposes

Most of our customers want to utilize the potential of Public Cloud. Public Cloud is also being adopted in business-critical environments in regulated markets. We support this development with our extensive accumulated experience in cloud implementations and transformations. Our close relationships with Amazon (AWS), Microsoft (Azure) and Google (GCP) have contributed to this. In 2018, our participation in the AWS re:Invent conference in Las Vegas, where we had 20 participants, was very strong. Our partnership with Microsoft has also grown strongly over the past year. In 2018, our colleagues gained the highest number of Public Cloud certifications since Schuberg Philis was established. This confirms our view that Public Cloud is indispensable to the services we offer to our customers.

Software development and big data

Schuberg Philis has had a successful year in terms of software development in critical business domains. Extensive integration in distributed environments has shown the need for this development capability. Big data analysis and Artificial Intelligence also contribute to optimizing business processes. Software development, especially Cloud-Native software development, offers unprecedented opportunities for our role as integrator. For a growing number of customers, functional solutions have been developed for business-critical processes on the basis of the latest possibilities offered by the Public Cloud. This greatly increases the speed of implementation as well as the speed of later changes.

Scalability

Scalability is a strategic theme at Schuberg Philis. The introduction of the three Greater Customer Teams, a Services team, and a Labs team in 2018 brought more agility and innovative power to our Customer Teams. As a result, our scalability increased, without loss of professionalism or customer intimacy. We have also launched initiatives with our customers to plan more for the longer term. The main purpose here is to preserve our flexibility and capacity to act in an environment with an increasing scarcity of IT talent and growing demand.

Schuberg Philis enjoys a very good reputation in the labor market. The People team that has found its feet in our new organizational structure focuses on the well-being of all of our colleagues and the organization as a whole. This team is structurally tasked with maintaining and expanding our open and inclusive partnership-oriented culture while stimulating diversity and leadership in the self-steering teams. This makes Schuberg Philis more attractive on the labor market for both new talent and experienced experts.

Relationships with customers

At Schuberg Philis we're proud of the long-term relationships we have with many of our customers. In 2018, two specific milestones were passed in these relationships. KLM has now been a highly valued customer for more than 15 years, and our partnership with Moneyou has passed the 10-year mark. Both milestones are a confirmation of mutual trust: this is something we're grateful for and, for us, it's a source of pride.

Significant growth

In 2018, Schuberg Philis experienced another year of significant revenue growth. Turnover in 2018 was €68.3 mln, 15% higher than in 2017 (€59.3 mln). Contracted revenues remained high at €108 mln. Net profit 2018 was €3.3 mln (5% of turnover, the same proportion as in 2017). Net profit was lower than in the years before 2017, mainly due to higher personnel costs as well as higher other costs incurred to serve our customers.

Our cash position is strong at €10 mln. The decrease in cash compared to last year is mainly due to investments in working capital. Our solvency remains very strong: it was well above 50% at the end of 2018.

In a rapidly changing business and IT environment, not being able to invest in innovation would be the greatest risk for long-term success, in combination with the risk of not being able to attract the right people due to the pressure in the Dutch ICT labor market. The availability of sufficient resources and a conservative capital structure makes us a financially sound company. That enables us to continue to grow by investing in highly qualified and talented colleagues as well as sustainable innovation for the benefit of our customers.

We look ahead to 2019 with confidence in our ability to amaze our existing and new customers as their IT Business Partner of choice. We pride ourselves in providing exceptional service that exceeds our customers' expectations and in strategically supporting them in achieving the very best performance. We are grateful for the strong relationships we have with our customers and partners and will prove ourselves continuously worthy of their trust.

On behalf of the Board and the Managing Directors,
Pim Berger

Pim Berger
Founder