The game plan is changing globally

Transcription

1 The game plan is changing globally Annual Review 2013

2 Contents 01 Introduction 02 Working smarter outside the office 04 Don t cloud your opportunities 06 By working together you can achieve extraordinary things 08 Helping our customers to take their game to a new level around the world 10 Chairman s statement 12 Chief Executive Officer s statement 16 Insight 18 Where we operate 20 Business model 22 Financial overview 24 Corporate responsibility 28 Board of Directors 30 Financial results 31 Our subsidiaries

3 The game plan is changing At Logicalis, we see that the world is shrinking; becoming more complex, with increasing competition, a deluge of new technologies and a changing workforce. The technology game plan is changing and the ability to compete in the new marketplace depends on investment in IT for maximum business advantage. In this review, Logicalis takes a world view of game-changing trends and identifies the technology developments that precede or follow these shifts. It takes an open mind to embrace these changes and over the next few pages we hear from our customers and leading thinkers on how this technology revolution is changing the game plan for businesses and individuals alike. Watch the video online when you see an icon and QR code Annual Review 2013 Logicalis 01

4 The game plan is changing Working smarter outside the office Executives recognise that the mobility experience is capable of delivering an array of commercial benefits, including improvements in workforce business efficiency, productivity, collaboration and innovation. 54% In mature markets, just 54% of employees believe that constant connectivity enables them to do their job better. 79% Employees in high-growth markets see bring-your-own-device as a way to get ahead in their careers, with 79% believing that constant connectivity to work applications enables them to do their job better. Og&list=UUsKItG189Tivv-SNyTxo6Gg 02 Logicalis Annual Review 2013

5 30 St Mary Axe Developed by Swiss Re and designed by architects Foster and Partners, this 40-storey office building is situated in the heart of the City of London. The building officially opened in March 2004 and provides some of the most flexible and environmentally sound office space in London. The building provides approximately 500,000 sq ft of office space from a footprint of just under 50 metres in diameter, a great deal smaller than a rectangular building providing the same accommodation and which enables the provision of a landscaped plaza around the building for residents and the public to enjoy. Analyst: Location: Solution: Adrian Drury Practice Leader, Consumer Impact Technology, Ovum London Enterprise Mobility Further information Download advisory paper, BYOD: an emerging market trend in more ways than one at The surge in boardroom interest in mobility reflects more than an enthusiasm for the latest executive toy. The passion for mobility stems from the recognition that enabling the workforce to have anytime, anywhere access to business applications and productivity tools via smart mobile devices makes sound business sense. We have seen how this is game changing for doctors, engineers, sales executives, students in fact everyone who has become used to taking their personal and social lives with them wherever they go. A report by Ovum in 2012 commissioned by Logicalis: BYOD: an emerging market trend in more ways than one, highlighted the difference in levels of bring-your-owndevice (BYOD) uptake between countries and specifically between mature economies and high-growth economies, and the correlated contrast in attitudes to work, privacy and mobile device usage. In recognising these cultural differences Logicalis adapts its mobility solutions accordingly and through our Mobility Experience Framework, we guide customers through the technical, security and policy decisions which need to be considered. The framework is based on Cisco s Smart Solution, for which Logicalis is a recognised Cisco partner. We are able to support customers in building out a tailored BYOD and mobility strategy, from the implementation roadmap to specifying the technology and business requirements and supporting the workforce for BYOD with cloud and managed services. Why Logicalis? Logicalis is the only partner you need to deliver mobility from business strategy to technical implementation. Products Network implementation right-size capacity to ensure a secure, rich mobile experience Supporting the right mix of applications across a broad range of devices Services Logicalis has a clearly defined process which guides customers through the technical, security and policy decisions which need to be considered. Our support services ensure customers are able to manage and adapt to new operating systems, devices and user demands. Annual Review 2013 Logicalis 03

6 The game plan is changing Don t cloud your opportunities Cloud computing provides a number of attractive attributes which can offer an organisation more flexibility and cost savings in its IT operations. wzotdytm&feature=youtu.be 04 Logicalis Annual Review 2013

7 The Statue of Liberty The Statue of Liberty is a colossal neoclassical sculpture on Liberty Island in New York Harbor, designed by Frédéric Bartholdi and dedicated on 28th October, The statue, a gift to the United States from the people of France, is of a robed female figure representing Libertas, the Roman goddess of freedom, who bears a torch and a tabula ansata upon which is inscribed the date of the American Declaration of Independence, July 4, A broken chain lies at her feet. The statue is an icon of freedom and of the United States: a welcoming signal to arriving immigrants. Client: Location: Solution: Mike Ostrander CTO Health Care DataWorks USA Business Analytics-as-a-Service Further information cloud-computing.aspx Read the case study for Health Care DataWorks at Health Care DataWorks (HCD) It s hard to avoid the obvious buzz around cloud computing. Almost every vendor has applied the term to anything and everything imaginable. During recent times there has been some debate over the level of adoption beyond the startup scene, specifically within the larger enterprise class of companies, but the majority of US businesses are now using some form of cloud computing for IT. Many businesses across all industries are experiencing the benefits of cloud adoption, including faster development cycles, and quicker time-to-market products resulting in increased sales. Logicalis is supporting organisations across many industries in harnessing the potential benefits of cloud computing, both from private, and hybrid cloud environments. A leading provider of business intelligence solutions for healthcare organisations, Health Care DataWorks(HCD) has partnered with Logicalis to implement its advanced healthcare analytics and business intelligence solution for healthcare systems, hosting their software as a service (SaaS) on the Logicalis Enterprise Cloud platform. This is just one example of Logicalis partnering with an Independent Software Vendor (ISV) to jointly develop an innovative business model that includes cloud services. As businesses face the economic uncertainties of the future whilst recognising that continued investment in IT enables business innovation, many business leaders are looking for new ways to service their IT needs. They need to drive efficiency in service delivery and establish a predictable cost base. Cloud services respond to these imperatives by offering an alternative to owning and operating some or all of an organisation s IT services. Why Logicalis? Logicalis can help you determine the best strategy for utilising cloud computing in your organisation and our professional services team can develop and execute a plan to meet your goals. Our Enterprise Cloud is an integrated cloud solution that offers unprecedented flexibility in capacity, ownership and services. It provides a highly secure, multi-tenant environment where we can build solutions for a single organisation, or for communities of like-minded organisations. It can remain relatively exclusive, or scale to hundreds of customers as the cloud market takes off. Annual Review 2013 Logicalis 05

8 The game plan is changing By working together you can achieve extraordinary things Business collaboration tools are changing the way we think about working together, delivering returns on investment from operational, productivity, and strategic perspectives. hnbhev_4zpu&feature=share 06 Logicalis Annual Review 2013

9 Palacio Salvo Palacio Salvo is a building in Montevideo, Uruguay, located at the intersection of 18 de Julio Avenue and Plaza Independencia. It was designed by the architect Mario Palanti, an Italian immigrant living in Buenos Aires, Argentina who used a similar design for his Palacio Barolo in Buenos Aires. Palacio Salvo was constructed in 1928 in a mixture of styles with influences of Italian gothic, and was for decades the tallest building in South America. Following its inauguration on 12th October 1928, it rapidly became a symbol of pride for the people of Montevideo. To this day it can be found on most postcards of the city and country and remains a national icon. Client: Location: Solution: Plan Ceibal Uruguay Workspace Collaboration Further information Find out more about Workspace Collaboration at Find out more about Ceibal at case-studies/plan-ceibal.aspx Plan Ceibal The new generation of collaborative tools has meant the workplace as we knew it has evolved considerably and has empowered people to engage and innovate anywhere, on any device. Collaboration involves many people in many different places. It enables people to work continuously across multiple platforms and devices with instant messaging, screen sharing, web and video conferencing, and shared workspaces on premises or in the cloud. Video places people at the centre of the collaboration experience. It enables them to work together in new ways to transform business and accelerate innovation, where everyone, everywhere can be face-to-face and more effective. There s no better example of this than in Uruguay, which is the first country to provide each child and teacher in the public education system, with a laptop and connectivity to use in education. In conjunction with an initiative called Plan Ceibal (Plan de Conectividad Educativa de Informática Básica para el Aprendizaje en Línea), Logicalis has delivered a video conferencing solution into multimedia classrooms and teaching points across the country making distance learning English language courses available to all primary children and school teachers. The results are inspirational and demonstrate the art of the possible. Video is as relevant in banking, retail and healthcare as it is in education and many other industries. With technology solutions like this, see how Logicalis can change the game plan for businesses and individuals alike. Why Logicalis? Communication and collaboration solutions from Logicalis converge data, voice and video and integrate your employees, your customers and your partners in a shared, borderless IT environment. Unified Communications: extend consistent communications to everyone in your organisation at corporate headquarters, at branch offices, working remotely, or via mobile devices. Video Conferencing: create a live, face-toface communication experience across your network. Workspace Collaboration: provide an instant shared environment for all kinds of work sessions, training sessions and sales presentations. Annual Review 2013 Logicalis 07

10 The game plan is changing Helping our customers to take their game to a new level around the world Logicalis takes care of everything for us from start to finish the whole enchilada. Jim Krueger, CIO Hydrite Chemical Logicalis US Logicalis lets us focus on what we re good at, and they take care of the rest. Mike Ostrander, CTO Health Care DataWorks Logicalis US wzotdytm&feature=youtu.be 08 Logicalis Annual Review 2013

11 With help from IBM and Logicalis, we have built a solution that is dramatically more scalable and adaptable. Our financial analysts are able to build new cubes and create new processes themselves, developing solutions in-house. This has completely transformed our ability to meet the needs of the business rapidly, and at minimal cost. Head of Performance Strategy Large Outsourcing Company Logicalis UK Logicalis provided exactly what we were looking for: an established service provider capable of providing reliable and prompt IP telephony support services. In addition, it has a strong regional presence in the Asia Pacific market. Christopher Han, Information System Manager FARO Technologies Logicalis Singapore The cooperation with Logicalis SMC went very well. They re committed professionals who are clearly conversant with this type of environment. They re very well attuned to the solution and clearly demonstrate their expertise. Jeroen van der Meer, CTO ASP4all Managed Hosting Services Logicalis SMC Netherlands Annual Review 2013 Logicalis 09

12 Chairman s statement We have delivered a record set of results, and are well placed for the future. Jens Montanana Chairman 10 Logicalis Annual Review 2013

13 Our EBITDA margins rose for the fourth consecutive year. I am delighted to report that Logicalis has delivered a record set of results and is well placed for the future. Our full year results show revenues rose a respectable 9% and almost all of it, 8%, was organic. Our EBITDA margins also rose for the fourth consecutive year and almost reached 6%. It was particularly pleasing to see a significant turnaround in the UK and the US, which make up the vast majority of the European and North America segments respectively. There were some challenges in the Asia Pacific region which was dragged down by the lower contribution from Australia, while Latin America s progress was slowed by weaker local currencies versus the US dollar. However, overall we are very pleased with the generally robust performance in all areas. Through recent acquisitions we have extended the footprint of Logicalis in to new markets and added impetus in some existing markets. Through the acquisition of the four European operations of 2e2, we now have operations in Spain, the Netherlands, Ireland and the Channel Islands to complement our existing presence in the UK and Germany, and from this year we will be reporting Europe as a single segment for Logicalis. Our income statement showed positive results across all areas. Gross margin growth outstripped the increase in operating costs and EBITDA rose 17% to $79 million. Our EBITDA margin has increased, as both geographic spread and our services mix continue to improve. Even more impressively, our operating profit rose by 28%. Our revenue split across regions has shown no real change over the last year. Europe last year was comprised mainly of the UK, with a small portion of the 24% derived from Germany. Latin America remains the largest region continuing to be driven by further expansion of telecommunications and network infrastructure. We are now in 24 markets in total: in 10 countries across Latin America from Argentina to Mexico, with Brazil still by far the largest, in six countries in Europe, in the USA and in seven countries across Asia Pacific. Our services business continues to grow steadily from under 20% to approaching our longer term target of 30% of total revenues and we have achieved a consistent and steady improvement in our product and services mix. The largest driver of this has been our maintenance and managed services activities which this year will exceed $250 million and could at some point be over 20% of our revenues. Overall, our services grew by 14% and the improving services mix has been a major contributor not only to margin stability but also to the predictability of the business over the cycle. Cisco remains the dominant vendor category in our product mix, providing not just networking equipment but solutions for data centres (such as servers and switches), security and collaborative voice and video applications. We do, however, expect our IBM business to grow this year based on the acquired businesses in Europe. Overall we do not expect a radical change to our product vendor mix as we remain focused as a system integrator on enterprise networks and data centres. During the financial year, Logicalis completed two acquisitions to expand its operations in Australia and South America. In June 2012, Logicalis Australia acquired Corpnet, a Brisbane-based solution provider, from e-business Systems Ltd, which provides data centre, cloud and managed services solutions to the Queensland mid-sized and enterprise markets. In November 2012, Logicalis Latin America increased its footprint in the region through the acquisition of the Colombia and Ecuador operations of Cibercall. Just after the end of our financial year, Logicalis made a major acquisition to expand its European footprint. In March 2013, Logicalis acquired the four European subsidiaries of 2e2, to include the Spanish and Irish systems integration businesses, operating under the Morse banner; the Channel Islands business (Jersey and Guernsey) and 2e2 s operation in the Netherlands which is a leading IT service management (ITSM) consultancy, also providing ITSM-as-a- Service offerings. Markets We are not yet seeing any obvious signs of recovery. Companies are continuing to cut costs and improve their balance sheets and are only investing in IT where compelling return on investment or competitive advantage can be achieved. However, we believe we are in an environment where the window for mergers and acquisitions is becoming attractive in this sector and our relative performance continues to surpass that of many of our peers, showing our financial strength is a significant asset. Jens Montanana Chairman Annual Review 2013 Logicalis 11

14 Chief Executive Officer s statement We are investing in building solutions and services based on new consumption models. Ian Cook Chief Executive Officer 12 Logicalis Annual Review 2013

15 We see trends such as cloud, mobility, BYOD, business analytics and big data creating new opportunities to further differentiate Logicalis in the market and with customers. I am pleased to report a record year for Logicalis, with increased revenues and margins in almost every region and significant growth in the revenues of our services business of 14%, which has overall improved our services mix and margin stability. In particular, our annuity service revenues were up 16% and reflected the long-term strategic focus on growing services. Both in North America and the UK, markets saw steady growth in demand for hosted cloud services, and strong growth for private cloud infrastructure and services. All Logicalis regions benefited from the emerging demand for business mobility solutions and services. The launch of our common services portfolio and delivery framework has, furthermore, established a solid services platform to build on. Again, I would like to thank all of our employees in all countries for their hard work and commitment in achieving these results, and to give a special thank-you to our customers, partners and stakeholders, whose support is greatly valued. Strategy The IT trends that we referenced last year continue to drive the ICT market: collaboration, personal device proliferation, user mobility, private and public cloud computing, big data and analytics, and new ICT consumption and operational models for data centre infrastructure and enterprise software. These trends gradually make business units more influential in the IT spend and decision making process, and this in turn is placing new demands on IT leadership to focus a greater part of their resources on business-outcome led engagements. As a result, IT solution providers such as Logicalis are increasingly being asked to support a wider and more varied engagement with clients. As well as providing traditional technology expertise, Logicalis is investing in building solutions and services based ever more on new consumption-based models. This is creating greater opportunity for consulting services, managed services and cloud services. This year sees the launch of Logicalis Optimal Services: a suite of services that span business productivity services and technology and operational services. Business productivity services bring agility and choice to organisations looking to exploit the very latest in unified communications, video and collaboration tools whether at the desk, in the home or on a smart mobile device. Technology, infrastructure and operational services help IT departments to deploy, build, operate or consume core IT systems or services with minimal risk and maximum operational efficiency, whether that be data centre capacity in their own data centre or from the cloud, or communications networks in the office, between locations or new mobile business environments. Our strategy of building strong customer intimacy continues to enable us to grow our relationships and solution and service engagements with existing clients. Adding value to vendor partners is also critical to Logicalis strategy. Helping our clients meet the oncoming opportunity of bring-your-own-device (BYOD) and mobility played a large part in our 2012/13 strategy. Working across all 20 (at the time of engagement) Logicalis countries, and supported by investment from Cisco, Logicalis launched a best-in-class industry framework for mobility the Logicalis Mobility Experience Framework. Bringing expertise from Logicalis and Cisco together in a single framework not only demonstrated industry thought leadership, but also provided significant value to customers, helping them accelerate and de-risk their own mobility strategies from device to business productivity applications. Annual Review 2013 Logicalis 13

16 Chief Executive Officer s statement continued Further information Find out more on pages with our Insight article: The Changing ICT World and Services Transformation Our continued commitment to leadership and technical excellence has been recognised again by our key vendors for the year under review: In 2013, at the Cisco Partner Summit, Logicalis was presented with 14 regional, theatre and country awards from Cisco across Latin America and Europe. Logicalis US was also awarded the IBM Growth Leadership Award for Looking ahead The operational priority for the coming year is to continue to demonstrate the value of ICT to our customers. We will maintain our focus on investing and innovating in our main areas of growth data centre and unified communications and collaboration solutions, cloud services, and managed services. We see trends such as cloud, mobility, BYOD, business analytics and big data creating new opportunities to further differentiate Logicalis in the market and with its customers. The global macroeconomic outlook is still mixed and some of our markets will be more difficult than others, however, our customers are generally well-positioned to invest. Logicalis management is optimistic about the next financial year and is planning for both revenue and operating profit growth. The Group will continue to seek to make further acquisitions that extend its scale and services business in established markets. Ian Cook Chief Executive Officer Logicalis Optimal Services bring business and technology together to work as one Services that optimise business productivity Business Mobility Services Workspace Communications Workspace Collaboration Workspace Virtualisation Business Productivity Services Optimal TM Security IT Service Management Applications Communications Data Centre Technology, Infrastructure & Operational Services Services that optimise technology investments and IT operations 14 Logicalis Annual Review 2013

17 Logicalis management is optimistic about the next financial year and is planning for both revenue and operating profit growth. Optimal Services Lifecycle Product and Solutions Services Skills and resources to both accelerate and de-risk the adoption of new IT enterprise architectures and business productivity solutions. Life Cycle Services Assure the availability, performance and operational integrity of core IT platforms, networks, systems and applications. Consult Design Maintain Monitor Supply Build Optimal TM Managed Services Enhance internal service delivery coverage, capacity and capability with trusted IT service out-tasking. Provisioned Services Consumption of infrastructure and business productivity services directly from Logicalis cloud platforms and from Logicalis XaaS eco-system partners. Manage Change Host Consume Annual Review 2013 Logicalis 15

18 Insight The Changing ICT World and Services Transformation Chris Barnard Associate Vice President European Telecommunications and Networking, IDC EMEA The ICT industry is in the midst of a once every years shift to a new technology platform for growth and innovation IDC terms this the Third Platform built on mobile devices and apps, cloud services, mobile broadband networks, big data analytics, and social technologies. By 2020, when the ICT industry reaches $5 trillion $1.7 trillion larger than it is today at least 80% of the industry s growth, and enterprises highest-value leverage of IT, will be driven by these Third Platform technologies, as well as an explosion of new solutions built on the new platform and rapidly expanding consumption of all of the above in emerging markets. Today, Third Platform technologies and the services around them generate only about 20% of all IT spending, but they are growing, collectively, at about 18% per year six times the rate of the rest of the IT industry. This transformation of the overall ICT market has significant implications. Third Platform technologies, such as unified communications and collaboration (UC&C), datacenter virtualization, mobility, and cloud-based solutions, change the way enterprises interact with employees, partners, and customers. A new wave of employees, referred to as Generation Y or digital natives, has vastly different requirements from the current enterprise standards around bring-yourown-device (BYOD), collaboration, working from home, the use of social networks, and security. These developments, in addition to on-going cost-cutting requirements, mean that virtualization efforts and data center consolidation will increase as enterprises move to cloud computing solutions. Unified communication and convergence efforts will gain pace among organizations while increasing numbers and types of devices requesting access to the enterprise network will proliferate. New devices including those related to machine-to-machine communications will bring greater complexity in traffic patterns, more security threats, and different user requirements, including compliance. Copious amounts of data traversing over networks will grow at staggering rates and the ability to make sense of the ever-increasing information will become a growing challenge for enterprise customers. This transformation will have a dramatic impact on the CIO: it implies a world out of the control of the CIO, at least compared to the strictly regulated worlds of the mainframe and client-server computing, which made up the First and Second Platforms of ICT. Requirements are exploding, ICT cornerstones such as compute and storage are commoditizing, connectivity demands are increasing, and line of business leaders are chipping away at the hegemony that the CIO enjoyed around technology decisions. Thus the CIO s challenge is to compress, contract, refine and simplify the ICT on offer, effectively the opposite of the trends feeding the Third Platform. This challenge calls for a network-centric view, as the network becomes one of the few areas where the CIO can exert control and address the new requirements. It is interesting to note that this approach was demonstrated in IDC s annual EMEA Enterprise Communications Survey for 2013, which has revealed that for European CIOs updating network infrastructure is now the most important priority. Overall in Europe 46% of respondents indicated that upgrading existing infrastructure and increasing bandwidth was a priority this year and this was the top selection. Next most important was improving data back-up and recovery (41%), and that was followed by improving security on the network (39%). In previous years security has been the top priority. A key reason for this was the indication elsewhere in the 2013 survey that the current network is struggling to cope with the Third Platform demands for example over 85% of companies that had implemented Cloud solutions had to consider upgrading the network in some form or other. Services Transformation The Third Platform is not only reshaping enterprise infrastructures and the role of the CIO. It is also changing the market for network-related services and the role of services companies, including the way they interact with enterprises. It demands a shift away from technology-led point solutions to businessoutcome-led solutions. Players in this space have to adapt in order to remain competitive in the future: the Second Platform approach of box shifting and limited services attach is not going to be good enough. IDC sees a bright future for Services companies that embrace this next-generation services approach. The total worldwide enterprise network consulting and integration services (NCIS) market accounted for $25.5 billion in revenue for 2012, growing at 5.4% over 2011, and is expected to reach $27.4 billion in The network continues to remain core to IT strategy and network-based initiatives will grow in importance. This market, which is intimately tied to enterprise network infrastructure growth, will grow over the forecast period to $35.4 billion by 2017, for a CAGR of 6.8%. These integration activities include labour-intensive services such as implementation, migration, security 16 Logicalis Annual Review 2013

19 Further information Worldwide Network Consulting and Integration Market ($bn) 25.5 Predicted IDC Predictions 2013: Competing on the 3rd Platform, by Frank Gens, November 2012 (IDC # ) Worldwide and U.S. Enterprise Network Consulting and Integration Services Forecast, by Leslie Rosenberg and Curtis Price, May 2013 (IDC # ) IDC Predictions: EMEA Network Life-Cycle Services in 2013, by Lionel Lamy, Chris Barnard, Bruno Teyton, and Andy Hicks, January 2013 (IDC # PM51V) EMEA Network Consulting and Integration Services 2011 Market and Forecast, by Lionel Lamy, Chris Barnard, Bruno Teyton, and Andy Hicks, December 2012 (IDC # IN03U) Find out more about IDC s Network Life-cycle Services research: Worldwide program: Europe, Middle East and Africa program: implementation, test and debug, and system configuration services. IDC believes moving through the forecast period that there will be a shift from many of these manual integration activities to more strategic consulting-led services. This migration will be driven by the use of automation and intelligence acquired from the devices and networks. IDC foresees that: Technology initiatives, such as mobile, social, cloud, and big data, which IDC collectively terms the four pillars of the Third Platform, will begin to drive transformation of the market. Network-centric technology initiatives, such as enterprise mobility, video, collaboration, datacenter transformation, and cloud, and understanding how software-defined networking (SDN) will impact future network initiatives, present strong opportunities. Increased complexity in networking architectures along with evaluating various consumption models (on-premise, managed, hosted, and cloud) will require enterprises to seek consulting and strategy engagements from third-party providers to help align technology requirements with business objectives. Services firms will continue to invest in tools, resources, and talent to meet customer needs and requirements outlined above, or risk falling behind competitors. In this new paradigm, processes will, at a high level and over time, require that the services delivery models transform rapidly to meet the needs of the customer. This will be characterized by taking people-intensive processes and distance out of the services model and replacing these elements with software, new tools, and processes to increase efficacy, cost efficiency, and profitability for services firms while increasing the ability for self-service and faster times for deployment for enterprises. IDC believes there will be more clearly defined articulation of services offers, leveraging the shift to the Third Platform, as well as increased investment in technologies to support this move. Over time, IDC has observed a steady evolution of services firms moving away from being technology (product)-led resale organizations that have been vendor-dependent to consulting-led or solutions-led firms which thereby define their own brand. IDC has observed the following trends that will continue to play a role in transforming the landscape: Investment in tools and processes to simplify, automate, standardize, and increase flexibility, with the goal of providing consistent delivery while reducing operational costs. Modularization of capabilities for increased customization for customers. Articulation of methodologies and best practices for competitive differentiation. M&A activity and partnering to provide end-to-end solutions and consumption models for enterprise customers. This evolution will be challenging for many firms, and significant investment in internal processes and technologies to increase operational, sales, and consulting efficiencies will be required. Conclusion Enterprises will continue to spend on strategic networking projects to remain competitive. As such, these projects are taking on a much more strategic role within the business, and services firms that provide best practice to ensure the success of an advanced networking deployment while closely aligning these investments to business outcomes will be market leaders. IDC believes that services firms that have defined and repeatable methodologies surrounding these types of offers will not only be successful meeting their clients objectives but create profitable businesses for themselves in a world that is being reshaped by the once every years shift to a new technology platform: the Third Platform built on mobility, cloud, big data analytics, and social technologies. $5 trillion By 2020 the ICT industry is predicted to reach $5 trillion Source: Worldwide and U.S. Enterprise Network Consulting and Integration Services Forecast, May 2013 (IDC # ) Annual Review 2013 Logicalis 17

20 Where we operate Delivering key services around the world Latin America Market $4.5bn value of network consulting and integration market in 2012 North America Market $10.4bn value of network consulting and integration market in 2012 North America Latin America Market position Operates across more than 20 offices in the USA Market position Present in Brazil, Argentina, Bolivia, Chile, Colombia, Ecuador, Mexico, Peru, Paraguay and Uruguay. Annual revenues: $420m Employees: 700 Annual revenues: $480m Employees: 1,180 Insight by IDC The North American market The market for network consulting and integration services (NCIS) in the USA will show a compound annual growth rate of 7% over IDC s five-year forecast period, reaching $14.7bn by In mature markets, networking-based technology deployments will become more complex and transformative to the business, and NCIS services will become that much more essential to the success of the deployment. Insight by IDC The Latin American market Growth opportunities in emerging markets will be greater than in mature regions such as North America. Latin America is expected to grow at a CAGR of 7.8% during our forecast period, to a value of $6.1bn in This can be attributed to the continued build-out of enterprise networks in these regions as well as the desire to take on more advanced capabilities in the network. 18 Logicalis Annual Review 2013

21 European Market $7.3bn value of network consulting and integration market in 2012 Asia Pacific Market $7.3bn value of network consulting and integration market in 2012 Managed Services Centres North America Cincinnati (US) Detroit (US) Europe Slough (UK) Cologne (Germany) Rijswijk, (NL) Latin America São Paulo (Brazil) Buenos Aires (Argentina) Asia Pacific Shanghai (China) Cyberjaya (Malaysia) Data Centres North America Cincinnati (US) Phoenix (US) Edison (US) Europe Slough (UK) Bracknell (UK) Guernsey South America São Paulo (Brazil) Asia Pacific Shanghai (China) Cyberjaya (Malaysia) Sydney (Australia) Europe Asia Pacific Market position Present in UK, Ireland, Netherlands, Spain, Channel Islands and Germany Market position Present in Australia, Singapore, Taiwan, Malaysia, Indonesia, China and Hong Kong Annual revenues: $480m Employees: 1,055 Annual revenues: $120m Employees: 510 Insight by IDC The European market Mature markets, such as Europe will see slow, but steady growth over the forecast period given the subdued economic conditions. The market for Europe, the Middle-East and Africa (EMEA) will grow at a CAGR of 6.2% to a value of $9.9bn by Certain verticals, such as financial services will return to more normal IT and network spending than others, such as government, which will vary by country/region. Insight by IDC The Asia Pacific market This market (our analysis excludes market data for Japan) is expected to grow over the forecast period at a CAGR of 7.8% to a value of $4.7bn. Advanced networking technologies and applications drive the growth. Opportunities in data centres and cloud will require services organisations to refine and formalise their methodologies and go-to-market offers for the enterprise and also to upgrade their skills. Annual Review 2013 Logicalis 19

22 Business model Our game plan Our focus Our main strength is bringing value to commercial and public sector mid-sized organisations, as well as large enterprises and service providers. Large Enterprise Global 2000 Large mid-range Emerging mid-range SMB Our markets Banking and Financial Services Education Energy and Utilities Healthcare Government Manufacturing and Distribution Professional Services Retail Telecom Service Providers Our strategic objectives Solving problems for our customers is at the heart of our core business objectives For our customers Improve efficiency of corporate IT resources and maximise value from existing investments Embrace new technologies with confidence Enable new user experiences and services Exploit new ownership and consumption models Enable secure environments For our business Invest in innovation and infrastructure for competitive advantage Offer our customers choice in ownership and operational models Build a consistent international footprint Leverage our partnerships with the world s leading technology vendors Attract and retain the best people Our investment Innovation Infrastructure People 20 Logicalis Annual Review 2013

23 Our value proposition We mitigate risk for our customers by integrating, managing and facilitating their technology consumption. Systems Integrator Our strong partnerships We build strong partnerships with the world s leading ICT vendors and understand their latest technology developments to interpret how new technology platforms can deliver services and solutions across our international framework. Cloud Services Business and technology working as one Managed Services Our portfolio Our customers tell us that doing business with us internationally also means consistent engagement processes, culture and infrastructure. Integration Cloud services Managed services Infrastructure and Software Solutions Data Centre and Virtualisation Communications and Collaboration Communications Networks Business Analytics Consulting Services Professional Services Communications and Collaboration UCaaS Video aas Collaboration aas Hosted UC VDesk aas Consulting Services Data Centre Data Centre Hosting Managed Hosting IaaS PaaS VMaaS VDIaaS Consulting Services Remote Infrastructure Management and Support Services Communications Networks Collaboration Computing Storage Virtualisation Maintenance Creating value Security Infrastructure Security SIEM MDM Application Firewalls AAA Consulting Services Annual Review 2013 Logicalis 21

24 Financial overview A strong performance across all our regions Creating value Latin America remains the largest region Latin America remains the largest region continuing to be driven by further expansion of communications and network infrastructure. Logicalis now operates in 10 countries across Latin America from Argentina to Mexico but with Brazil still by far the prime operation. In FY 2013, Europe comprised mainly the UK with only a small element of the 24% derived from Germany. In the next financial year however, Europe will make up a higher proportion, following the acquisitions in Spain, Ireland, the Netherlands and the Channel Islands. Stronger services mix Logicalis improved its services-to-product revenue mix with services now approaching our longer term target of 30% of total revenues. Revenue from total services grew by 14% and the largest driver of this has been our managed services activities. In FY 2014, our annuity revenues are planned to exceed $250m. The improving services mix has been a major contributor not only to margin stability but also to improved predictability of business in the current challenging economic environment. Revenue % geographic split 2013 North America 31% Latin America 36% Europe 24% Asia Pacific 9% Revenue % segmental split 2013 Product 73% Professional Services 10% Maintenance and Managed Services 17% Revenue % geographic split 2012 North America 31% Latin America 36% Europe 25% Asia Pacific 8% Revenue % segmental split 2012 Product 75% Professional Services 9% Maintenance and Managed Services 16% 22 Logicalis Annual Review 2013

25 Cisco remains the most significant product vendor Cisco remains the most significant vendor partner for Logicalis, providing not just networking equipment but solutions for data centres (such as servers and switches), security and collaborative voice and video applications. Our IBM revenues are expected to grow in this financial year based on the acquired 2e2 businesses in Europe, but overall the vendor product solutions mix remains steady as we continue to focus as a system integrator on enterprise networks and IT solutions for data centres. Improvement in gross margins Overall the gross margin percentage reached 23% of revenues and with good margin management showed a positive upturn in every region except Asia Pacific. The change in Asia Pacific was attributable to the product and services mix, as the region has been expanding by increasing product sales to the enterprise market and growing the business in Indonesia. Revenue % by vendor 2013 Gross margin % 2013 and 2012 IBM 19% Cisco 55% HP 10% Others 16% Europe FY 2013 FY 2012 North America Revenue % by vendor 2012 Latin America IBM 19% Cisco 56% HP 11% Others 14% Asia Pacific Total Annual Review 2013 Logicalis 23

26 Corporate responsibility Logicalis policy is to actively and enthusiastically support the welfare of its people, the environment and local communities wherever we have a presence. Our people Logicalis aims to be an employer of choice; attracting, developing and retaining the best people. We understand that knowledge is the key to success and we maintain good communications with employees through our information and consultation procedures. Our personnel practices ensure that every employee, wherever they work, and whatever their role, is treated equally, fairly and respectfully at all times. Adherence to international health and safety standards ensures that our people are properly protected and cared for, wherever they operate. Logicalis maintains consistent and transparent diversity policies across all our markets. We firmly believe that career opportunity, recognition and reward should be determined by a person s capabilities and achievement, not their age, sex, race, religion or nationality. Wherever we operate, Logicalis strives to maintain a workforce that reflects the skills, ethnicity and demographics of the local population. Logicalis recognises that it is the ideas, skills and capabilities of our people that drive our development and growth. In return, Logicalis will invest in whatever training and resources our people need to ensure that they are able to develop and grow with us. Logicalis is committed to rewarding its shareholders though consistently producing above-average returns and growth. Environment As a responsible international provider of ICT solutions, Logicalis seeks to measure and minimise the way in which any of its commercial activities may impact the environment. Logicalis is also committed to providing practical advice and support to its customers and suppliers to help them along the path to ever cleaner and greener ICT solutions. As an early adopter of Green ICT ideas and activities, Logicalis recognises that a responsible attitude to Green ICT can lead to significant reductions in energy consumption and carbon emissions. As well as reducing greenhouse gases and operational costs, the technologies it promotes, such as remote working and video and teleconferencing, enable more flexible working, greater productivity and improved business continuity. The Logicalis Group s Slough, UK office maintains an environmental management system, compliant with ISO 14001, which is used to set and monitor targets for waste reduction and reductions in power and water usage and which is audited by an independent consultant every 12 months. Initiatives to reduce the business s environmental impact have included green events for employees to spread understanding of good environmental practice throughout the organisation. This year, Logicalis environmental objectives are to review the solar panel technology for our head office in Slough and also roll out a user training and adoption programme on video conferencing which will reduce fuel consumption. Logicalis UK s continued focus on the efficiency of its data centre operations leads to incremental increases in the company s efficiency as measured by PUE (power usage effectiveness). The effects of the increased investment that Logicalis UK made when building its data centre assets have resulted in an improved efficiency rating. In the last year alone this has saved over 300,000 KWhs of energy usage. Logicalis US maintains a national vendor partnership with Cintas to handle office paper recycling across all offices. Every quarter Cintas provides Logicalis US with a certificate reflecting the number of trees the division has saved based upon the gross weight of paper recycled. 24 Logicalis Annual Review 2013

27 In addition, Logicalis US maintains a national partnership to provide water filtration systems across all offices which has been shown to reduce the volume of water consumed compared to more conventional tap water access. Logicalis US invests in fuel-efficient vehicles that are involved with local customer cabling solutions. Logicalis US also engages with its prospective landlords to understand any green initiatives they comply with, or are implementing. This can include anything from LEED (Leadership in Energy and Environmental Design) certified buildings, to office lights which automatically shut off upon sensing non-activity (as installed in our corporate HQ), to more efficient power supply solutions. In Latin America, for the fourth consecutive year, Logicalis Southern Cone carried out paper and plastic recycling campaigns for the Foundation of Garrahan Hospital in Argentina, an institution specialising in complex treatments for children. The campaigns involve office collection of disposable paper and plastic cups, to be donated to the Foundation for recycling. Logicalis Latin America is also developing actions to raise awareness about natural resource conservation (paper, water and electricity) through posters in meeting rooms and across its offices. In Brazil, PromonLogicalis has set up minibuses to encourage employees to use public transportation to reduce CO 2 emissions and traffic jams. In Asia Pacific, Logicalis Singapore has plans to install water-saving devices and energy-saving lights in its premises. In Logicalis Australia, two of the three Australian offices have moved into new premises, which feature an activity-based workplace fitout that reduces power requirements (through a reduced number of desks and floorspace) and promotes effective teleworking. Community Logicalis encourages its operating companies in every territory to create initiatives that help improve the quality of life for their local communities. Here are just a few highlights. During the 2012 holiday season, Logicalis US donated over US$55,000 to 50 charities in communities where its employees work and live; each charity was nominated and selected by local employees in one of 16 geographical regions, and employees also made the cheque presentation. Their support made a big difference to community agencies ranging from food banks and homeless shelters to healthcare research. In addition, Logicalis US encourages all employees to donate their time in their local community by providing eight hours of paid time off annually. The Logicalis US Catch a Shining Star recognition programme allows employees to nominate their co-workers for going above and beyond the call of duty; in the last year, 10 employees were selected to be a NOVA recipient which is the highest level of recognition allowing each of them to identify a charity to which Logicalis US donated US$200 in their name. Donations of US$2,000 were made in 2012 to a total of ten charities. Annual Review 2013 Logicalis 25

28 Corporate responsibility continued In Logicalis UK, employees are given the opportunity to donate to charities through the charitable giving option in their flexible benefits programme. They have also held a couple of charity bake days where employees bake cakes and all proceeds are given to local charities. They have also supported a cancer hospice, an alzheimer s hospice and other children s charities. Logicalis Southern Cone made several donations to regional schools: in Argentina it donated to two schools in Entre Rios; in Chile to Maria Ayuda Foundation of Santiago; in Paraguay, Logicalis supports Adela Speratti of Asuncion school; in Peru it donated to the ANAR Foundation (Aid to Children and Adolescents at Risk) and in Uruguay they have supported a school in Montevideo. In Brazil, PromonLogicalis supports the Junior Achievement organisation and has started a volunteer programme which has provided education and work readiness training to young adults and vocational education for adolescents from disadvantaged communities. PromonLogicalis also supports Mozarteum Achievement, an organisation that aims at bridging the school-work gap and fostering entrepreneurship. PromonLogicalis joined the council of Instituto Razao Social, an organisation that focuses on developing learning and teaching processes and the skills of public school educators. In 2011, PromonLogicalis launched the Portal do Voluntariado (Volunteer Portal) where its employees can find opportunities to help disadvantaged communities. Logicalis Singapore has a Recreation Club comprising employees who research potential community projects for the organisation to be involved in. Logicalis Singapore has supported the SingTel Touching Lives Fund (TLF) by participating in its charity golf tournament for the past nine years. The TLF is SingTel s corporate philanthropy programme and aims to provide disadvantaged children and young persons with special needs or who are at risk with learning opportunities and the chance to improve their quality of life. Logicalis Singapore also helped to raise funds by participating in the M1 Charity Golf 2012 tournament and donating the proceeds to its adopted charities: Beyond Social Services, Children-At-Risk Empowerment Association, Children s Cancer Foundation, Singapore Children s Society and the Spastic Children s Association of Singapore. Typically, 1% of Logicalis Singapore s profits go towards such community projects. In 2012, Logicalis Australia supported Marathon Cricket, an event raising money for disabled sports charities over $12,000 was raised by Logicalis and its customers. Logicalis Australia also supported a number of cancer charities, with all money raised from auctioning obsolete equipment and furniture following their office move being given to Redkite (an organisation which supports parents who have children with cancer). 26 Logicalis Annual Review 2013

29 In Logicalis UK, employees are given the opportunity to donate to charities through the charitable giving option in their flexible benefits programme. Our core values Customer-oriented we listen to our customers needs and focus on delivering value to their organisations. Trusted we consistently deliver on our promises. Honest we have a culture that is based on integrity and openness. Quality we are professional in all our business dealings and dedicated to achieving, and maintaining the highest standards. Innovative we attract spirited and creative employees who show heart and conviction in all that they do. Empowerment we foster a can-do approach where helping our customers and colleagues is central to our job satisfaction. Annual Review 2013 Logicalis 27

30 Board of Directors 1. Jens Montanana Chairman Jens is the founder of and chief architect behind Datatec, which he established in 1986, and also Chairman of Logicalis since March Between 1989 and 1993, Jens served as Managing Director and Vice-President of US Robotics (UK), a wholly owned subsidiary of US Robotics which was acquired by 3Com. In 1993, he co-founded US start-up Xedia Corporation in Boston, MA, an early pioneer of network switching and one of the market leaders in IP bandwidth management, which was subsequently sold to Lucent Corporation. In 1994, Jens became Chairman and Chief Executive Officer (CEO) of Datatec which listed on the Johannesburg Stock Exchange in November 1994 and on the Alternative Investment Market of the London Stock Exchange in He has previously served on the boards and subcommittees of various public companies, and currently serves as chairman of Corero plc, an AIM-listed software security business Ian Cook Chief Executive Officer Ian Cook is CEO of Logicalis Group. Since he stepped into the role in March 2007, Logicalis has become an international brand and a respected partner of the major technology vendors. Ian has wide-ranging experience in the technology industry spanning more than 25 years. He joined Logicalis from Damovo where he had extensive involvement in its international operations as Chief Operating Officer (COO). Prior to Damovo, in 1990 Ian led the Board of Cablestream which became Siemens Network Systems Ltd (SNSL) (now Affiniti), one of the UK s leading network integrators. Over a ten-year period at SNSL he rose to Group Managing Director responsible for operations across Europe. Ian Cook joined Logicalis as CEO, European Operations in 2003 and became CEO of Logicalis Group in Since then Logicalis has changed from acting as a value-addedreseller for specific manufacturers to a broadbased IT solutions provider with data centre assets on four continents. Managed services cover all aspects of IT business needs, from simple remote monitoring to hosting and innovative cloud services such as Analytics-as-a-Service. 3. Mark Rogers Chief Operating Officer Mark Rogers joined Logicalis in 2003 as Finance Director for Logicalis UK, and in 2004 he became Chief Financial Officer (CFO), European Operations. Since March 2007, he has taken on the role of COO for Logicalis Group. Mark has extensive experience in the technology and service sectors both in the UK and internationally. He spent 20 years at Racal Electronics/Thales, of which 13 years were at Finance Director level within divisions providing Managed Network Services, Telecoms, and Survey and Positioning Services. While at Thales he was also Chairman of Citylink Telecommunications, a joint venture company which had secured a 1.2bn, 20-year Private Finance Initiative contract with London Underground. Also, he has significant mergers and acquisitions experience, including the sale of Racal Telecom to Global Crossing for 1bn as well as experience in the acquisition and integration of smaller businesses. He started his finance career with Revlon where he qualified as a Chartered Management Accountant. 28 Logicalis Annual Review 2013

31 4. Nigel Drakeford-Lewis Chief Financial Officer Nigel Drakeford-Lewis is a Fellow of the Institute of Chartered Accountants in England and Wales and also has an honours degree in Economics and Accountancy from Exeter University. Nigel joined Datatec in June 2000, initially to help build an advisory services division which was subsequently merged with Logicalis. He then moved across to Logicalis Group in November 2000 to focus on the reshaping of Logicalis Group and help redefine its strategic direction. Since April 2001, Nigel has been CFO of the Group with responsibility for the financial management and control of operations across the Group. After qualifying as a Chartered Accountant with Grant Thornton, Nigel held senior financial positions with Black & Decker, Grand Metropolitan (now Diageo) and Dixons Group. Prior to joining Datatec, Nigel worked for five years as a senior consultant with Arthur D Little on strategy, corporate finance and performance improvement assignments, primarily in the fixed and mobile telecommunications sector. Rob Evans Non-Executive Director Rob has held a wide range of financial, operational and M&A roles both within Datatec and other organisations internationally. Between 1996 and 2000, Rob was Datatec s UK Finance Director and then Group M&A Director, during which time he worked on more than 20 acquisitions around the world. He rejoined the Group in 2008, initially as an integration and transformation executive with oversight of the Group s emerging markets operations in Africa, India and the Middle East (AIME). He then became Chief Operating Officer of Westcon AIME. Since 2010 he has been Head of the Consulting Services division, is on several of the Group s subsidiary boards and is Chairman of Analysys Mason. On 1st May 2012, he became CFO for Datatec Limited. Rob has previously held senior positions with divisions of other listed groups including Proudfoot and Data Translation. He began his career qualifying as a Chartered Accountant with KPMG, where he worked in both London and Melbourne. Felipe Lima Non-Executive Director Felipe Alceu Amoroso Lima is an Executive Director and CFO of Promon since June In August 2011 he was appointed a Non- Executive Director of the Logicalis Board. From 2005 to 2010, Felipe served as CFO and Board Member for Votorantim Cement North America (VCNA) a leading manufacturer of cement and supplier of building materials in the United States and Canada, with responsibility for the finance, legal and IT departments. VCNA is a subsidiary of the Brazilian-based Grupo Votorantim, one of the largest conglomerates in Latin America. From 1996 to 2005, Felipe was with Citigroup, as a Vice President for the Latin America Debt Capital Markets in New York for six years. Prior to Citigroup he served in various roles at Unibanco, Promon Engenharia, Schlumberger, and Caterpillar. Felipe Lima has a B.S. degree in Mechanical Engineering from Universidade Estadual de Campinas. Stephen Davidson Non-Executive Director Stephen Davidson is Chairman of Datatec Limited and Mecom Group plc. He is also a non-executive director of Inmarsat plc, EBT Mobile China plc and Weare2020 plc. Annual Review 2013 Logicalis 29

32 Financial results 2013 US$m Income statement unaudited Revenue 1, ,236.5 Cost of sales (1,042.1) (959.1) Gross profit Administrative expenses (231.7) (210.0) EBITDA Depreciation of property, plant and equipment (14.3) (13.3) Amortisation of intangible fixed assets (9.6) (11.5) Operating profit Net finance costs (9.5) (4.5) Datatec management fees (4.8) (4.9) Revaluation of non-controlling interest buy-out liability 1.1 Release of excess acquisition consideration 1.6 Goodwill adjustments 0.4 Profit before tax Tax on profit on ordinary activities (16.5) (14.8) Profit for the year US$m 2013 US$m Balance sheet unaudited Goodwill and other intangible assets Property, plant and equipment Deferred tax asset Total non-current assets Inventories Trade and other receivables Foreign corporation tax recoverable Cash and cash equivalents Total current assets Total assets Trade and other payables) (426.7) (431.0) Bank overdrafts and loans (26.7) (44.6) Current tax liabilities (3.5) (1.1) Obligations under finance leases (3.2) (5.3) Deferred consideration on acquisition of subsidiaries (3.9) (10.4) Liability for share-based payments (2.7) (4.1) Total current liabilities (466.7) (496.5) Net current assets Amounts owed to holding company and fellow subsidiaries (32.9) (38.0) Obligations under finance leases (3.4) (6.3) Deferred consideration on acquisition of subsidiaries 0.0 (3.3) Liability for share-based payments (6.4) (3.7) Deferred tax liabilities (23.8) (21.1) Other long term liabilities (5.0) (6.0) Total non-current liabilities (71.5) (78.4) Total liabilities (538.2) (574.9) Net assets (218.8) Share capital and share premium Foreign currency exchange and other non-distributable reserves (37.0) (26.1) Retained earnings Attributable to equity holders of the parent Non-controlling interest Total equity US$m 30 Logicalis Annual Review 2013

33 Our subsidiaries Percentage held Statutory name Country of incorporation Holding Company Logicalis Group Limited England and Wales 100% 100% Subsidiaries of Logicalis Group Limited Logicalis Group Services Limited England and Wales 100% 100% Logicalis UK Limited England and Wales 100% 100% Satelcom Limited England and Wales 100% 100% Logicalis Computing Solutions Limited England and Wales 100% 100% Hawke Systems Limited England and Wales 100% 100% T.B.C. Group Limited England and Wales 100% 100% TBC Limited * England and Wales 100% 100% Promon-Logicalis Latin America Limited England and Wales 60% 60% Logicalis Computing Solutions Finance Limited * England and Wales 100% 100% Direct Visual Group Limited * England and Wales 100% 100% Direct Visual Limited * England and Wales 100% 100% Direct Visual Services Limited * England and Wales N/A 100% Next Generation Internet Limited * England and Wales N/A 100% Inca Software Limited * England and Wales 100% 100% Logicalis Limited (dormant) England and Wales 100% 100% Logical Group Limited (dormant) England and Wales 100% 100% Logicalis (Ireland) Limited Ireland 100% 100% Logicalis Deutschland GmbH Germany 100% 100% Logicalis Networks GmbH * Germany 100% 100% Logicalis GmbH * Germany 100% 100% Logicalis US Holdings, Inc. USA USA 100% 100% Logicalis, Inc. * USA 100% 100% Network Infrastructure Corporation * USA 100% 100% Logicalis South America Inc * USA 60% 60% Logicalis Argentina S.A. * Argentina 60% 60% Logicalis Brasil Servicos de Assessoria Tecnica Limitada * Brazil 60% 60% PromonLogicalis Tecnologia e Participações Limitada * Brazil 60% 60% PTLS Serviços de Tecnologia e Assessoria Técnica Limitada * Brazil 60% 60% PLLAL International LLC * USA 60% 60% Logicalis Andina Bolivia LAB. Ltda. * Bolivia 60% 60% Logicalis Chile S.A. * Chile 60% 60% Logicalis Colombia S.A.S. * Colombia 60% 60% Logicalis Ecuador S.A. * Ecuador 60% 60% Logicalis Paraguay S.A. * Paraguay 60% 60% Logicalis Andina S.A.C * Peru 60% 60% Logicalis Uruguay S.A. * Uruguay 60% 60% Logicalis Inc. S.A. * Uruguay 60% 60% NetStar Group Holding Limited British Virgin Islands 100% 100% Logicalis Australia Pty Limited * Australia 100% 100% Corpnet (Australia) Pty Limited* Australia 100% 0% Logicalis Shanghai Limited * China 100% 100% Logicalis Pte Limited (Xiamen) * Hong Kong 100% 100% Logicalis Hong Kong Limited * Malaysia 100% 100% Logicalis Malaysia Sdn Bhd * Malaysia 100% 100% Logicalis Asia Pacific MSC Sdn Bhd* Malaysia 100% 100% Logicalis Singapore Pte Limited * Singapore 100% 100% PT. Logicalis Metrodata Indonesia Indonesia 51% 51% * Indicates a subsidiary which is owned indirectly via an intermediate holding company. Annual Review 2013 Logicalis 31

34 Business and technology working as one Follow us on: 32 Logicalis Annual Review 2013