2012-08-09 08:01:00 CEST
2012-08-09 08:01:11 CEST
REGULATED INFORMATION
Digia Oyj - Interim report (Q1 and Q3)
DIGIA PLC SECOND QUARTER 2012: POSITIVE DEVELOPMENT IN PRODUCT BUSINESS WHILE CHALLENGES IN CONTRACT ENGINEERING BUSINESS CONTINUED TO TAX PROFITABILITY
Helsinki, 2012-08-09 08:01 CEST (GLOBE NEWSWIRE) -- DIGIA PLC INTERIM REPORT 9
August 2012, 9:00 A.M.
DIGIA PLC SECOND QUARTER 2012: POSITIVE DEVELOPMENT IN PRODUCT BUSINESS WHILE
CHALLENGES IN CONTRACT ENGINEERING BUSINESS CONTINUED TO TAX PROFITABILITY
SUMMARY
January-June
- Consolidated net sales: EUR 50.6 (65.7) million, down 23.1 per cent
- Operating profit before extraordinary items EUR 2.7 (2.9) million, down 7.3
per cent
- Extraordinary items include a EUR 0.6 million restructuring provision
associated with the reorganisation (2011: restructuring provision EUR 3.2
million and goodwill writedown EUR 25.4 million)
- Operating profit after extraordinary items: EUR 2.1 (-25.6) million
- Profitability (EBIT %) before extraordinary items was 5.3 (4.4) per cent and
after extraordinary items 4.1 (-39.0) per cent
- Product business accounted for 29.9 (18.2)per cent
- Earnings per share before extraordinary items EUR 0.08 (0.12) and after
extraordinary items EUR 0.05 (-1.20)
April-June
- Consolidated net sales: EUR 24.5 (32.4) million, down 24.3 per cent
- Operating profit before extraordinary items EUR 1.3 (0.6) million, up 100.3
per cent
- Operating profit after extraordinary items: EUR 0.7 (-27.9) million
- Profitability (EBIT %) before extraordinary items was 5.1 (1.9) per cent and
after extraordinary items 2.8 (-86.2) per cent
- Product business accounted for 33.1 (21.9) per cent
- Earnings per share before extraordinary items EUR 0.04 (0.05) and after
extraordinary items EUR 0.01 (-1.27)
Qt business developed as planned during the reporting period, with net sales
showing growth and profitability improving towards the period end. At the end
of the second quarter, Qt business profitabilitywas very good. With Qt
business, the proportion of the company's product business and international
business grew significantly compared to the same period in the previous year.
They now form a significant portion of the company's entire business.
After the reporting period, on 8 August 2012, Digia signed a contract with
Nokia Corporation for the acquisition of Qt software technology and the related
business. Digia expects this acquisition to drive positive development of the
Qt business in the future.
On the whole, however, Digia's net sales showed a marked decrease year-on-year.
This is attributable to the major reduction in demand for mobile contract
engineering services that began in Q2/2011. During the reporting period, the
downward trend was even stronger than anticipated and taxed the company's
profitability, especially in the second quarter.
Since Q2/2011, Digia has taken consistently and successfully adapted its
business and organisation to match the changed business environment.
Despite the adjustment measures, the decline in net sales has inevitably led to
a proportional increase in fixed costs, holding back profitability development
in the reporting period. Besides challenges in Digia's remaining contract
engineering business, other factors eroding profitability included the
investments made in international business.
Digia reiterates its forecast for the remainder of 2012 and expects to see its
operational efficiency improve and profitability rise to a good level during
the second half.
GROUP KEY FIGURES AND RATIOS
4-6/20 4-6/20 Change 1-6/20 1-6/20 Change 2011
12 11 , % 12 11 , %
--------------------------------------------------------------------------------
Net sales 24,493 32,358 -24.3 50,558 65,715 -23.1 121,94
% % 0
--------------------------------------------------------------------------------
Operating profit before 1,256 627 100.3 2,674 2,886 -7.3 % 8,084
extraordinary items %
--------------------------------------------------------------------------------
- % of net sales 5.1 % 1.9 % 5.3 % 4.4 % 6.6 %
--------------------------------------------------------------------------------
Operating profit 676 -27,88 2,095 -25,62 -22,16
6 7 8
--------------------------------------------------------------------------------
- % of net sales 2.8 % -86.2 4.1 % -39.0 -18.2
% % %
--------------------------------------------------------------------------------
Net profit 280 -26,26 1,077 -24,81 -22,45
3 5 2
--------------------------------------------------------------------------------
- % of net sales 1.1 % -81.2 2.1 % -37.8 -18.4
% % %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Return on equity, % 2.9 % -217.5 5.5 % -99.2 -41.9
% % %
--------------------------------------------------------------------------------
Return on investetment, 5.1 % -152.1 7.4 % -67.8 -28.7
% % % %
--------------------------------------------------------------------------------
Interest-bearing 18,407 22,457 -18.0 18,407 22,457 -18.0 21,872
liabilities % %
--------------------------------------------------------------------------------
Cash and cash 8,375 5,300 58.0 % 8,375 5,300 58.0 % 8,170
equivalents
--------------------------------------------------------------------------------
Net gearing, % 25.5 % 46.1 % 25.5 % 46.1 % 34.5 %
--------------------------------------------------------------------------------
Equity ratio, % 50.9 % 42.5 % 50.9 % 42.5 % 47.8 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR, 0.01 -1.27 0.05 -1.20 -1.08
undiluted
--------------------------------------------------------------------------------
Earnings per share, EUR, 0.01 -1.27 0.05 -1.20 -1.08
diluted
--------------------------------------------------------------------------------
MARKETS AND DIGIA'S BUSINESS
Deceleration of economic growth in several Eurozone countries is reining in
Finnish exports and total output. Customer companies, which see information
technology as an element that can facilitate greater operational efficiency and
growth, are nonetheless pursuing their projects and initiating new ones. In
some cases, economic uncertainty has lengthened decision-making processes and
project schedules have been delayed. Customers are also experiencing growing
cost pressures, which is beginning to reflect on their purchase decisions.
In terms of human resources, the situation is somewhat conflicting: On the one
hand, a large number of experts were released onto the job market from various
contract engineering projects; on the other, there is a shortage of experienced
architecture and business experts, which is causing lengthened recruitment
processes and pressure for rising labour cost.
Although the introduction of the new organisation at the beginning of 2012 went
smoothly and according to plan, in some areas operational efficiency
enhancement measures still continue.
Growing cost pressures on customers had a major impact on demand for contract
engineering services in the second quarter. Demand for ERP systems and other
operational systems was reasonable during the reporting period.
The Qt business increased its net sales, with operations progressing according
to plan during the period. Profitability also improved as expected, as the
period progressed. At the end of the period, the profitability level was very
good.
In Digia's Russian unit, business development efforts are more sharply focused
on ERP system deliveries to local customers, especially in the trade sector's
value chain. In addition, the unit provides near shore resource services to
Finnish business units. Local business continued to grow during the period, as
new customer relationships were established.
Digia's Chinese unit shifted its focus even more towards local business
development. The unit's capacity is also used to provide off shore services to
the Finnish business units.
NET SALES
Digia's consolidated net sales for the reporting period were EUR 50.6 (65.7)
million, down 23.1 per cent on the same period in 2011.
The decrease was due to a sharp fall in demand for mobile contract engineering
services after the end of the comparison period and during the reporting
period. On the other hand, net sales from the Qt business grew considerably
year-on-year and was EUR 7.0 million for the reporting period.
During the reporting period, the product business accounted for EUR 15.1
million (EUR 11.9 million) or 29.9 per cent (18.2 per cent) of consolidated net
sales.
International operations accounted for EUR 10.6 (5.7) million, or 21.0 (8.7)
per cent of consolidated net sales.
Digia's consolidated net sales for the second quarter were EUR 24.5 (32.4)
million, down 24.3 per cent on the same period in 2011.
In the second quarter, product business accounted for EUR 8.1 (7.1) million of
consolidated net sales, or 33.1 (21.9) per cent.
International operations accounted for EUR 5.4 (3.2) million of consolidated
net sales in the second quarter, or 22.2 (9.9) per cent.
PROFIT PERFORMANCE AND PROFITABILITY
Digia's consolidated operating profit before extraordinary items for the
reporting period was EUR 2.7 (2.9) million, down 7.3 per cent year-on-year.
Profitability (EBIT %) before extraordinary items was 5.3 (4.4) per cent.
Extraordinary items included a EUR 0.6 million restructuring provision
associated with the reorganisation of the Group Management Team carried out as
part of the operational efficiency improvement.
Digia Group's operating profit after extraordinary items amounted to EUR 2.1
(-25.6) million. Profitability (EBIT %) after extraordinary items was 4.1
(-39.0) per cent.
Digia's consolidated operating profit before extraordinary items in the second
quarter was EUR 1.3 (0.6) million, up 100.3 per cent year-on-year.
Profitability (EBIT %) before extraordinary items was 5.1 (1.9) per cent.
Digia Group's operating profit after extraordinary items amounted to EUR 0.7
(-27.9) million. Profitability (EBIT %) after extraordinary items was 2.8
(-86.2) per cent.
The company's operating costs and profitability were affected by investments in
the international product business, a relative increase in the proportion of
fixed operating costs, and the additional costs arising from higher personnel
turnover. Moreover, the weaker than expected profitability of the remaining
contract engineering business taxed performance in the second quarter.
Consolidated earnings before tax for the period totalled EUR 1.5 (-26.2)
million, and net profit was EUR 1.1 (-24.8) million. Consolidated earnings
before tax for the second quarter were EUR 0.4 (-28.1) million, and net profit
totalled EUR 0.3 (-26.3) million.
Consolidated earnings per share for the period, before extraordinary items,
were EUR 0.08 (0.12). Consolidated earnings per share after extraordinary items
came to EUR 0.05 (-1.20). Consolidated earnings per share, before
extraordinary items, for the second quarter were EUR 0.04 (0.05). Consolidated
earnings per share after extraordinary items for the second quarter came to EUR
0.01 (-1.27).
The Group's net financial expenses for the reporting period were EUR 0.6 (0.5)
million and for the second quarter EUR 0.3 (0.2) million.
FINANCIAL POSITION AND EXPENDITURE
At the end of the reporting period, Digia Group's consolidated balance sheet
total stood at EUR 81.8 million (12/2011: EUR 87.8 million), and the equity
ratio was 50.9 (12/2011: 47.8) per cent. Net gearing was 25.5 (12/2011: 34.5)
per cent. Period-end cash and cash equivalents totalled EUR 8.4 (12/2011: 8.2)
million.
Interest-bearing liabilities amounted to EUR 18.4 (12/2011: 21.9) million.
These consisted of EUR 17.0 million in loans from financial institutions and
EUR 1.4 million in financial leasing liabilities.
The Group's cash flow from operations for the period was positive by EUR 6.5
(3.6) million, cash flow from investments was negative by EUR 1.2 (1.4)
million, and cash flow from financing was negative by EUR 5.1 (6.6) million.
Cash flow from financing was negatively affected by the repayment of loans for
a total sum of EUR 3.0 million, as well as the payment of EUR 2.1 million in
dividends.
The Group's investments in fixed assets during the reporting period totalled
EUR 0.3 (1.4) million. Acquisitions of tangible fixed assets totalled EUR 0.2
(0.9) million.
Return on investment (ROI) for the period was 7.4 (-67.8) per cent, and return
on equity (ROE) was 5.5 (-99.2) per cent.
The Group carries out quarterly impairment testing of goodwill and intangible
assets with an indefinite useful life.
The table below shows the distribution of goodwill and values subject to
testing at the end of the reporting period:
EUR Specified Amortisations during Goodwi Other Total value
1,000 intangible the reporting period ll items subject to
assets testing
--------------------------------------------------------------------------------
Group 2,925 495 44,543 7,866 55,334
total
--------------------------------------------------------------------------------
Present values were calculated for a five-year forecast period based on the
following assumptions: Net sales and operating profit for the first two
quarters of the forecast period according to the confirmed figures, and for the
following two quarters according to budget. As of the beginning of 2013, annual
net sales growth of 3 per cent, operating profit of 10 per cent, and a discount
rate of 8.9 per cent are forecast. Cash flows after the forecast period are
estimated by means of cash-flow extrapolation, applying the assumptions given
above.
According to a completed sensitivity analysis, the estimated goodwill requires
net sales to remain at the current level, with profitability at 4.4 per cent,
or net sales growth of 7.0 per cent with profitability at 0.1 per cent. The
management sees no risk of goodwill impairment.
HUMAN RESOURCES, MANAGEMENT, AND ADMINISTRATION
At the end of the period, the total number of Group personnel was 997,
representing a decrease of 178 employees, or 15.1 per cent since the end of
2011 (2011: 1,175). During the reporting period, the number of employees
averaged 1,045, a decrease of 408 employees or 28.1 per cent from the 2011
average (2011: 1,453).
Employees by function at the end of the period:
Business units 96 %
-----------------------------------
Administration and management 4 %
-----------------------------------
As of the end of the period, 162 employees were working abroad (12/2011: 161).
The Digia Plc Annual General Meeting of 13 March 2012 re-elected Robert Ingman,
Kari Karvinen, Pertti Kyttälä and Tommi Uhari as members of the Board. Päivi
Hokkanen, Seppo Ruotsalainen and Leena Saarinen were elected as new members. At
the organisation meeting of the Board, Pertti Kyttälä was elected Chairman of
the Board and Robert Ingman Vice Chairman.
Juha Varelius has been Digia Plc's President and CEO since 1 January 2008.
In June 2012, Anja Wasenius became Digia's acting CFO.
Ernst & Young Oy, authorised public accountants, are the Group's auditors, with
Authorised Public Accountant Heikki Ilkka as the principal auditor.
RISKS AND UNCERTAINTIES
Short-term uncertainties are related to any major changes occurring in the
company's core business areas.
The Eurozone debt crisis and the risk of economic recession may affect
customers' investment decisions and liquidity, and thereby the company's sales
and profits. There have already been signs of the effect of increased
uncertainty on customers' investment decisions, and some planned projects have
been delayed.
Furthermore, as the size of customer projects grows, risks related to the
projects and profitability management are increasing.
Risks and their management are described on the company's website at
www.digia.com.
FUTURE PROSPECTS
The company's main objective for 2012 is to grow the share of the scalable
product business. The main cornerstone of the company's operations remains the
maintenance of high profitability and a positive cash flow.
The company expects the IT market to remain at roughly the previous year's
level in 2012. However, risks associated with the Eurozone debt crisis and
general inflation may affect demand for IT services and the development of
business profitability. Slightly greater uncertainty is therefore related to
the economic prospects for 2012.
The company expects demand for its ERP systems, operational systems and
integration services to grow during the rest of the year.
Measures will be completed to improve the efficiency of the contract
engineering business and to adapt operations to the current market conditions.
The company will continue to seek expansion in the growing Russian market,
especially through its Business Intelligence solutions, ERP systems and
complementary products and services, and particularly within the trade and
logistics customer segments.
The company plans to align its Chinese operations to correspond even better to
local sales and international delivery contracts. As part of this realignment,
the Beijing sales unit will also support Qt business sales.
The company expects the Qt business to retain a healthy profit level, and net
sales from the business to show continued positive development for the rest of
the year.
On the whole, Digia expects to improve its operational efficiency and to raise
its profitability to a healthy level during the second half.
OTHER EVENTS DURING THE REPORTING PERIOD
Convening on 13 March 2012, the Digia Plc Annual General Meeting (AGM) approved
the financial statements for 2011, released the Board members and the CEO from
liability, determined Board emoluments, resolved to keep the number of Board
members at seven, and elected the Board of Directors for the new term.
With regard to profit distribution for 2011, the AGM approved the Board's
proposal to make a repayment of capital of EUR 0.10 per share to all
shareholders listed on the shareholder list maintained by Euroclear Finland Ltd
on the reconciliation date of 16 March 2012. The date for the repayment of
capital was set at 23 March 2012.
The AGM granted the following authorisations to the Board:
Authorisation of the Board of Directors to decide on buying back own shares
and/or accepting them as collateral
The AGM authorised the Board to decide on the buyback and/or acceptance as
collateral of no more than 2,000,000 shares in the company. This buyback can
only be executed by means of the company's unrestricted equity. The Board shall
decide on how these shares are to be bought. Own shares may be bought back in
disproportion to the holdings of the shareholders. The authorisation also
includes acquisition of shares through public trading organised by NASDAQ OMX
Helsinki Oy in accordance with the rules and instructions of NASDAQ OMX
Helsinki and Euroclear Finland Ltd, or through offers made to shareholders.
Shares may be acquired in order to improve the company's capital structure, to
fund acquisitions or other business transactions, for offering share-based
incentive schemes, to sell on, or to be annulled. The shares must be acquired
at the market price in public trading. This authorisation supersedes that
granted by the AGM of 16 March 2011 and is valid for 18 months - i.e. until 13
September 2013.
Authorising the Board of Directors to decide on a share issue and granting of
special rights
The AGM authorised the Board to decide on an ordinary or bonus issue of shares
and the granting of special rights (as defined in Section 1, Chapter 10 of the
Limited Liability Companies Act) in one or more instalments, as follows: The
issue may total, at a maximum, 4,000,000 shares. The authorisation applies both
to new shares and to treasury shares held by the company. By virtue of the
authorisation, the Board has the right to decide on share issues and the
granting of special rights, in deviation from the pre-emptive subscription
rights of the shareholders (a directed issue). The authorisation may be used to
fund or complete acquisitions or other business transactions, for offering
share-based incentive schemes, to develop the company's capital structure, or
for other purposes. The Board was authorised to decide on all terms related to
the share issue or special rights, including the subscription price, its
payment in cash or (partly or wholly) in capital contributed in kind or its
being written off against the subscriber's receivables, and its recognition in
the company's balance sheet. This authorisation supersedes that granted by the
AGM of 16 March 2011 and is valid for 18 months - i.e. until 13 September 2013.
SHARE CAPITAL AND SHARES
On 30 June 2012, the number of Digia Plc shares totalled 20,875,645.
At the end of the period, according to Finnish Central Securities Depository
Ltd, Digia had 5,964 shareholders.
The 10 biggest shareholders were:
Shareholder Shares and votes
--------------------------------------------------------------
Ingman Group Oy Ab 16.3 %
--------------------------------------------------------------
Jyrki Hallikainen 10.2 %
--------------------------------------------------------------
Pekka Sivonen 8.8 %
--------------------------------------------------------------
Kari Karvinen 6.5 %
--------------------------------------------------------------
Matti Savolainen 6.1 %
--------------------------------------------------------------
Ilmarinen Mutual Pension Insurance Company 4.8 %
--------------------------------------------------------------
Varma Mutual Pension Insurance Company 3.6 %
--------------------------------------------------------------
Nordea Bank Finland Plc (nominee-registered) 1.5 %
--------------------------------------------------------------
Etola Oy 1.0 %
--------------------------------------------------------------
Olli Ahonen 0.9 %
--------------------------------------------------------------
Distribution of holdings by number of shares on 30 June 2012
Number of shares Shareholders Shares and votes
-----------------------------------------------------
1 - 100 22.2 % 0.4 %
-----------------------------------------------------
101 - 1,000 59.2 % 7.7 %
-----------------------------------------------------
1,001 - 10,000 17.2 % 13.1 %
-----------------------------------------------------
10,001 - 100,000 1.0 % 9.1 %
-----------------------------------------------------
100,001 - 1,000,000 0.3 % 21.6 %
-----------------------------------------------------
1,000,001 - 4,000,000 0.1 % 47.9 %
-----------------------------------------------------
Distribution of shareholding by sector on 30 June 2012
Shareholders Shares
--------------------------------------------------------------------
Non-financial corporations 4.4 % 21.3 %
--------------------------------------------------------------------
Financial and insurance corporations 0.3 % 4.5 %
--------------------------------------------------------------------
General government 0.1 % 8.4 %
--------------------------------------------------------------------
Not-for-profit institutions serving households 0.3 % 0.6 %
--------------------------------------------------------------------
Households 94.6 % 64.1 %
--------------------------------------------------------------------
Rest of the world 0.4 % 1.1 %
--------------------------------------------------------------------
The weighted average number of shares during the reporting period, adjusted for
share issues, came to 20,754,153. The number of outstanding shares came to
20,772,523 in total at the end of the review period.
The company held a total of 103,122 treasury shares at the end of the reporting
period. The accounting counter value of these treasury shares is EUR 0.10 per
share. Treasury shares accounted for about 0.5 per cent of the capital stock at
the period-end. In relation to the company's performance-based incentive
system, Digia has financed the acquisition of 300,000 own shares. At the end of
the review period, 12,424 of these shares remained undistributed and were under
the management of Evli Alexander Management Ltd.
REPORTED SHARE PERFORMANCE ON THE HELSINKI STOCK EXCHANGE
Digia Plc shares are listed on the Nordic Exchange under ‘Information
Technology IT Services'. The company's short name is DIG1V. The lowest reported
share quotation was EUR 2.28 and the highest was EUR 3.30. The share officially
closed at EUR 2.35 on the last trading day. The trade-weighted average was EUR
2.92. The Group's market capitalisation totalled EUR 49,057,766 at the end of
the period.
The company received no flagging notifications during the reporting period.
STOCK OPTION SCHEMES
Digia Plc had no outstanding options.
Helsinki, 9 August 2012
Digia Plc
Board of Directors
BRIEFING FOR ANALYSTS
Digia will hold a briefing on its financial statement for analysts on Thursday
9 August 2012, at 11 am, at WTC Sodexo, in the Marski cabinet of the World
Trade Center, Aleksanterinkatu 17, 00100 Helsinki, Finland.
SOURCES OF FURTHER INFORMATION
President and CEO Juha Varelius, mobile +358 400 855 849, email
juha.varelius@digia.com
The Interim Report and presentation thereof will be available at the company's
website at www.digia.com in the ‘Investors' section, from 11am.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
ABBREVIATED FINANCIAL STATEMENTS AND ATTACHMENTS
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Consolidated Statement of Changes in Shareholders' Equity
Notes to the Accounts
The interim report has been prepared in compliance with IFRS and the IAS 34
standard.
This interim report is based on unaudited figures.
CONSOLIDATED INCOME STATEMENT, EUR 1,000
4-6/20 4-6/20 Change 1-6/20 1-6/20 Change 2011
12 11 , % 12 11 , %
--------------------------------------------------------------------------------
NET SALES 24,493 32,358 -24.3 50,557 65,715 -23.1 121,93
.4 .3 % .8 .1 % 9.9
--------------------------------------------------------------------------------
Other operating income 251.6 28.5 782.5 453.8 52.7 761.0 360.7
% %
--------------------------------------------------------------------------------
Materials and services -2,184 -3,906 -44.1 -4,729 -6,390 -26.0 -10,72
.9 .6 % .2 .2 % 1.0
--------------------------------------------------------------------------------
Depreciation, -697.5 -26,38 -97.4 -1,345 -27,31 -95.1 -29,26
amortisation, and 7.2 % .5 4.0 % 7.9
impairment
--------------------------------------------------------------------------------
Other operating expenses -21,18 -29,97 -29.3 -42,84 -57,69 -25.7 -104,4
6.2 9.1 % 2.0 0.3 % 79.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 676.4 -27,88 2,094. -25,62 -22,16
6.1 9 6.7 8.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial expenses (net) -289.1 -185.6 55.7 % -636.8 -528.3 20.5 % -963.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings before tax 387.3 -28,07 1,458. -26,15 -23,13
1.8 1 5.0 1.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income taxes -107.6 1,809. -380.7 1,340. 679.5
2 3
--------------------------------------------------------------------------------
NET PROFIT 279.7 -26,26 1,077. -24,81 -22,45
2.6 4 4.7 1.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other comprehensive
income:
--------------------------------------------------------------------------------
Exchange differences on 192.3 -121.0 317.4 -0.6 42.1
translating foreign
operations
--------------------------------------------------------------------------------
TOTAL COMPREHENSIVE 472.0 -26,38 1,394. -24,81 -22,40
INCOME 3.6 8 5.3 9.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Distribution of net
profit:
--------------------------------------------------------------------------------
Parent-company 279.7 -26,26 1,077. -24,81 -22,45
shareholders 2.6 4 4.7 1.6
--------------------------------------------------------------------------------
Minority interest 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Distribution of total
comprehensive income:
--------------------------------------------------------------------------------
Parent-company 472.0 -26,38 1,394. -24,81 -22,40
shareholders 3.6 8 5.3 9.5
--------------------------------------------------------------------------------
Minority interest 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR 0.01 -1.27 0.05 -1.20 -1.08
--------------------------------------------------------------------------------
Earnings per share 0.01 -1.27 0.05 -1.20 -1.08
(diluted), EUR
--------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET, EUR 1,000
Assets 30.6.2012 31.12.2011 Change, %
---------------------------------------------------------------------
---------------------------------------------------------------------
Non-current assets
---------------------------------------------------------------------
Intangible assets 47,885.3 48,486.7 -1.2 %
---------------------------------------------------------------------
Tangible assets 2,469.3 3,156.5 -21.8 %
---------------------------------------------------------------------
Financial assets 627.0 627.0 0.0 %
---------------------------------------------------------------------
Long-term receivables 60.3 60.3 0.0 %
---------------------------------------------------------------------
Deferred tax assets 707.3 789.9 -10.5 %
---------------------------------------------------------------------
---------------------------------------------------------------------
Total non-current assets 51,749.2 53,120.3 -2.6 %
---------------------------------------------------------------------
---------------------------------------------------------------------
Current assets
---------------------------------------------------------------------
Current receivables 21,694.6 26,523.0 -18.2 %
---------------------------------------------------------------------
Available-for-sale financial assets 312.8 303.5 3.1 %
---------------------------------------------------------------------
Cash and cash equivalents 8,061.9 7,866.5 2.5 %
---------------------------------------------------------------------
---------------------------------------------------------------------
Total current assets 30,069.3 34,693.0 -13.3 %
---------------------------------------------------------------------
---------------------------------------------------------------------
Total assets 81,818.4 87,813.3 -6.8 %
---------------------------------------------------------------------
Shareholders' equity and liabilities 30.6.2012 31.12.2011 Change, %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Share capital 2,087.6 2,087.6 0.0 %
--------------------------------------------------------------------------------
Rights issue 0.0 0.0
--------------------------------------------------------------------------------
Issue premium fund 7,899.5 7,899.5 0.0 %
--------------------------------------------------------------------------------
Other reserves 5,203.8 5,203.8 0.0 %
--------------------------------------------------------------------------------
Unrestricted invested shareholders' equity 33,447.8 35,525.0 -5.8 %
--------------------------------------------------------------------------------
Translation difference 525.8 208.4 152.3 %
--------------------------------------------------------------------------------
Retained earnings -10,952.7 11,279.9
--------------------------------------------------------------------------------
Net profit 1,077.4 -22,451.6
--------------------------------------------------------------------------------
Equity attributable to parent-company 39,289.2 39,752.6 -1.2 %
shareholders
--------------------------------------------------------------------------------
Minority interest 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total shareholders' equity 39,289.2 39,752.6 -1.2 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Liabilities
--------------------------------------------------------------------------------
Long-term interest-bearing liabilities 12,551.6 15,441.7 -18.7 %
--------------------------------------------------------------------------------
Other long-term liabilities 265.0 674.0 -60.7 %
--------------------------------------------------------------------------------
Deferred tax liabilities 644.9 772.0 -16.5 %
--------------------------------------------------------------------------------
Total long-term liabilities 13,461.5 16,887.7 -20.3 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Short-term interest-bearing liabilities 5,855.2 6,430.2 -8.9 %
--------------------------------------------------------------------------------
Other short-term liabilities 23,212.5 24,742.8 -6.2 %
--------------------------------------------------------------------------------
Total short-term liabilities 29,067.7 31,173.0 -6.8 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total liabilities 42,529.2 48,060.7 -11.5 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total shareholders' equity and liabilities 81,818.4 87,813.3 -6.8 %
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT, EUR 1,000
1.1.2012-30.06. 1.1.2011-30.6. 1.1.2011-31.12
2012 2011 .2011
--------------------------------------------------------------------------------
Cash flow from operations:
--------------------------------------------------------------------------------
Net profit 1,077 -24,815 -22,452
--------------------------------------------------------------------------------
Adjustments to net profit 3,830 29,615 34,780
--------------------------------------------------------------------------------
Change in working capital 1,226 2,223 2,791
--------------------------------------------------------------------------------
Interest paid -358 -370 -781
--------------------------------------------------------------------------------
Interest income 2 19 35
--------------------------------------------------------------------------------
Taxes paid 713 -3,025 -5,532
--------------------------------------------------------------------------------
Cash flow from operations 6,490 3,646 8,842
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from investments:
--------------------------------------------------------------------------------
Purchases of tangible and -1,163 -1,407 -2,733
intangible assets
--------------------------------------------------------------------------------
Cash flow from investments -1,163 -1,407 -2,733
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from financing:
--------------------------------------------------------------------------------
Proceeds from share issue 0 0 0
--------------------------------------------------------------------------------
Acquisition of own shares 0 0 0
--------------------------------------------------------------------------------
Repayment of current loans -3,044 -1,044 -19,044
--------------------------------------------------------------------------------
Repayments of non-current loans 0 0 0
--------------------------------------------------------------------------------
Withdrawals of current loans 0 0 3,500
--------------------------------------------------------------------------------
Withdrawals of non-current 0 0 13,500
loans
--------------------------------------------------------------------------------
Dividends paid and other profit -2,078 -5,577 -5,577
distribution
--------------------------------------------------------------------------------
Cash flow from financing -5,123 -6,621 -7,621
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Change in liquid assets 205 -4,382 -1,512
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Liquid assets at beginning of 8,170 9,682 9,682
period
--------------------------------------------------------------------------------
Change in fair value
--------------------------------------------------------------------------------
Change in liquid assets 205 -4,382 -1,512
--------------------------------------------------------------------------------
Liquid assets at end of period 8,374 5,300 8,170
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, EUR 1,000
2011 a) b) c) d) e) f) g) h)
--------------------------------------------------------------------------------
Shareholders' equity, 1 2,086 40 7,899 35,486 5,204 166 16,529 67,411
January 2011
--------------------------------------------------------------------------------
Net profit -24,81 -24,81
5 5
--------------------------------------------------------------------------------
Other comprehensive -1 -1
income
--------------------------------------------------------------------------------
Distribution of dividends -5,577 -5,577
--------------------------------------------------------------------------------
Share-based payments 1 -40 39 236 236
recognised against
equity
--------------------------------------------------------------------------------
Shareholders' equity, 30 2,088 0 7,899 35,525 5,204 165 -13,62 37,254
June 2011 7
--------------------------------------------------------------------------------
2012 a) b) c) d) e) f) g) h)
--------------------------------------------------------------------------------
Shareholders' equity, 1 2,088 0 7,899 35,525 5,204 208 -11,17 39,753
January 2012 2
--------------------------------------------------------------------------------
Net profit 1,077 1,077
--------------------------------------------------------------------------------
Other comprehensive income 317 317
--------------------------------------------------------------------------------
Repayment of capital -2,077 -2,077
--------------------------------------------------------------------------------
Share-based payments 219 219
recognised against equity
--------------------------------------------------------------------------------
Shareholders' equity, 30 2,088 0 7,899 33,448 5,204 526 -9,875 39,289
June 2012
--------------------------------------------------------------------------------
a = share capital
b = rights issue
c = share premium
d = unrestricted invested shareholders' equity
e = other reserves
f = currency translation differences
g = retained earnings
h = total shareholders' equity
NOTES TO THE ACCOUNTS
Accounting principles
The interim report has been drafted in line with IFRS, applying the same
accounting principles as in the 2011 financial statements. The accounting
principles and formulae for the calculation of key figures and ratios are
unchanged and are presented in the 2011 financial statements.
Seasonal nature of business
The Group's business is affected by the number of workdays each month, as well
as by holiday seasons.
Dividends paid
Dividends paid during the reporting period totalled EUR 2,077,252.30.
Events after the reporting period
After the reporting period, on 8 August 2012, Digia signed a contract with
Nokia Corporation for the acquisition of Qt software technology and the related
business. This acquisition will enter into effect during the third quarter of
2012. With the acquisition, Digia will assume responsibility for all
liabilities and operations, previously handled by Nokia, associated with Qt
technologies. More detailed information on the acquisition is available from
stock exchange and press releases issued by Digia today. Digia will provide
more information on the effects of the acquisition on the company's business,
after the transaction has been finalised.
Related-party transactions
Digia Group's related parties include the CEO and the members of the Board of
Directors and Group Management Team. Digia Group had no significant
transactions with related parties during the reporting period.
Consolidated income statement by quarter
EUR 1,000 4-6/2012 1-3/2012 10-12/20 7-9/201 4-6/2011
11 1
--------------------------------------------------------------------------------
Net sales 24,493.4 26,064.4 30,197.3 26,027. 32,358.3 5
--------------------------------------------------------------------------------
Other operating income 251.6 202.2 261.0 47.0 28.5
--------------------------------------------------------------------------------
Materials and services -2,184.9 -2,544.3 -2,568.9 -1,761. -3,906.6
9
--------------------------------------------------------------------------------
Depreciation, amortisation, and -697.5 -648.0 -1,095.9 -858.1 -26,387.
impairment 2
--------------------------------------------------------------------------------
Other operating expenses -21,186. -21,655. -25,407. -21,381 -29,979.
2 8 6 .8 1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 676.4 1,418.5 1,385.9 2,072.7 -27,886.
1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial expenses (net) -289.1 -347.7 -318.3 -116.6 -185.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings before tax 387.3 1,070.8 1,067.7 1,956.2 -28,071. 8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income taxes -107.6 -273.1 149.8 -810.5 1,809.2
--------------------------------------------------------------------------------
Net profit 279.7 797.7 1,217.5 1,145.6 -26,262.
6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Allocation:
--------------------------------------------------------------------------------
Parent-company shareholders 279.7 797.7 1,217.5 1,145.6 -26,262.
6
--------------------------------------------------------------------------------
Minority interest 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR 0.01 0.04 0.06 0.06 -1.27
--------------------------------------------------------------------------------
Earnings per share (diluted), 0.01 0.04 0.06 0.06 -1.27
EUR
--------------------------------------------------------------------------------
Group key figures and ratios: 1-6/2012 1-6/2011 2011
--------------------------------------------------------------------------------
Extent of business:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 50,558 65,715 121,940
--------------------------------------------------------------------------------
- change from previous year -23.1 % -3.1 % -6.8 %
--------------------------------------------------------------------------------
Average capital invested 59,660 75,219 76,176
--------------------------------------------------------------------------------
Personnel at period end 997 1,512 1,175
--------------------------------------------------------------------------------
Average number of personnel 1,045 1,560 1,453
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profitability:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit before extraordinary items and 2,674 2,886 8,084
impairment
--------------------------------------------------------------------------------
- % of net sales 5.3 % 4.4 % 6.6 %
--------------------------------------------------------------------------------
Operating profit 2,095 -25,627 -22,168
--------------------------------------------------------------------------------
- % of net sales 4.1 % -39.0 % -18.2 %
--------------------------------------------------------------------------------
Earnings before tax 1,458 -26,155 -23,131
--------------------------------------------------------------------------------
- % of net sales 2.9 % -39.8 % -19.0 %
--------------------------------------------------------------------------------
Net profit 1,077 -24,815 -22,452
--------------------------------------------------------------------------------
% of net sales 2.1 % -37.8 % -18.4 %
--------------------------------------------------------------------------------
Return on equity, % 5.5 % -99.2 % -41.9 %
--------------------------------------------------------------------------------
Return on investment, % 7.4 % -67.8 % -28.7 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financing and financial standing:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Interest-bearing liabilities 18,407 22,457 21,872
--------------------------------------------------------------------------------
Short-term investments, and cash and bank 8,375 5,300 8,170
receivables
--------------------------------------------------------------------------------
Net gearing 25.5 % 46.1 % 34.5 %
--------------------------------------------------------------------------------
Equity ratio 50.9 % 42.5 % 47.8 %
--------------------------------------------------------------------------------
Net cash flow from operations 6,490 3,646 8,842
--------------------------------------------------------------------------------
Earnings per share, undiluted (EUR) 0.05 -1.20 -1.08
--------------------------------------------------------------------------------
Earnings per share, diluted (EUR) 0.05 -1.20 -1.08
--------------------------------------------------------------------------------
Equity per share 1.88 1.78 1.90
--------------------------------------------------------------------------------
Lowest share price 2.28 2.79 2.30
--------------------------------------------------------------------------------
Highest share price 3.30 5.79 5.79
--------------------------------------------------------------------------------
Average share price 2.92 4.55 3.88
--------------------------------------------------------------------------------
Market capitalisation 49,058 71,395 50,519
--------------------------------------------------------------------------------
Formulas for key figures and ratios are presented in the 2011 financial
statements. These formulas remained unchanged during the reporting period.
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