FY10 results for Swedish ERP vendor, IFS Group, were markedly impacted by currency fluctuations. Total revenue decreased by 1% to SKr2,585 million, but up by 4% when adjusted for currency (though the impact of its acquisition in October - see IFS adds (360) Scheduling capability - is unclear). Taking the adjusted currency figures, everything looks to be heading in the right direction – EBIT was up 14% to SKr221 million and cash flow after investments was Skr234 million (compared to SKr186 million in 2009). Such a performance will support the company’s goal of upping the pace of its acquisitions in 2011.
We were struck by two statements in the release. First, IFS makes a very strong statement regarding its competitive differentiation – “we listen and respond rather than dominate and dictate”. SAP and Oracle aren’t mentioned directly but the inference is there. IFS takes the same approach as Unit4 (see Unit4 to challenge SAP in larger authorities) i.e. it is concentrating on a limited number of market segments (such as defence and manufacturing) and working on differentiating its ERP solutions accordingly. Both companies hope to take market share from the big boys in their selected verticals. Second, IFS has expanded its alliance with NEC in order to provide IFS applications as a service hosted in NEC’s cloud-oriented data centre. A smart move.