Company
The company grew revenues and profits and maintained momentum. All parts of the business had a strong quarter with the ETWeb products performing particularly well.

Demand for online recruitment solutions and total talent management continued to be robust in all regions, evidenced by 48% organic growth in revenue during the quarter. This compares to 45% organic growth in the corresponding quarter last year. Q4 2007 revenues were €28.6m, up 84% year on year.

The company believes that the market for its products and services is continuing to expand. Investment in Online sales and marketing resources and in Solutions delivery resources was increased during the last quarter of 2007. Further investment is planned for 2008.
Total company profitability continued to increase. EBITDA rose to €5.6m from €2.0m a year ago and EBITDA margin increased to 19% from 13%.

The company generated €4.9m of operating cash during the quarter bringing the total to €15.8m for 2007, significantly up from €7.0m in 2006.

In the first quarter of 2008 StepStone further expanded its online market presence by completing the acquisitions of Sourcea, a niche French job board, and Statsjobb, a Norwegian job board business focused on the public sector in Scandinavia.

Online
Demand for the company's online products remains strong. Contracted sales for the fourth quarter reached new record levels, rising by over 30% compared to the previous quarter and by over 55% compared to the last quarter of 2006. Demand remained strong in all countries in which the company operates with the Nordic region being of particular note.

Online revenue grew 61% in the final quarter of 2007 - of which 58% was organic - compared to the same period last year. Quarterly revenues rose to €16.9m. Profitability continued to increase, with EBITDA rising to €5.2m from €2.6m a year ago. EBITDA margins also continued to increase, to 31% compared to 25%.

Solutions
Solutions continued to strengthen its position as a leading player in the global talent management market. In a fourth quarter report by Bersin Associates on Talent Management Suites, StepStone was the highest ranking global, enterprise-level provider of Talent Management solutions.

The customer base continued to rapidly expand, with 88 new customers signing contracts in the quarter. This brought the total customer base for StepStone's solutions products to just over 1,250 at the end of 2007 compared to just over 500 at the start of the year.

Revenue increased 132% to €11.7m for the fourth quarter of which 36% was organic growth. EBITDA increased to €1.9m from €0.6m in Q4 2006 and EBITDA margin increased to 16% from 11%. Fourth quarter revenue and margin was boosted by seasonal demand for ETWeb products and services.

Solutions has grown very rapidly from €8m revenue in 2005 to €40m in 2007 whilst also transitioning ETWeb from a licence sales model towards a subscription based model. To enable continued revenue growth the company plans to substantially increase investment in Solutions' operations, processes and support functions.

Outlook
The Board is pleased with the development of the company during 2007. The customer base, revenues and profitability have all increased significantly, margins have been expanded, and the company is generating increasing amounts of operating cash. A very solid and successful foundation has been built from which we can look forward to 2008.

The momentum has continued into 2008 and the Board looks forward to continued growth and development for 2008.

Total Talent Management Software by StepStone Solutions