2009-10-28 08:30:00 CET
2009-10-28 08:30:02 CET
REGULATED INFORMATION
Ixonos - Interim report (Q1 and Q3)
Ixonos' operational result clearly positive as predicted
Ixonos Plc Interim report 28 October 2009 at 9:30 Interim report for the period 1 January - 30 September 2009 IXONOS' OPERATIONAL RESULT CLEARLY POSITIVE AS PREDICTED Highlights in the review period: - Turnover for the review period was EUR 47.6 million (2008: EUR 54.6 million), a change of -12.9 per cent. - One-off events: The company wrote off EUR 7.2 million in goodwill allocated to the Business Solutions unit. The impairment loss has no cash impact. - Operating profit before goodwill impairment was EUR 1.5 million (2008: EUR 3.6 million), 3.1 per cent of turnover; operating profit decreased -58.2 per cent. - Operating profit was EUR -5.7 million (2008: EUR 3.6 million), -12.0 per cent of turnover. - Net profit was EUR -6.7 million (2008: EUR 2.0 million), -14.1 per cent of turnover. - Earnings per share were EUR -0.72 (2008: EUR 0.22). - Diluted earnings per share were EUR -0.72 (2008: EUR 0.22). - Net cash flow from operative activities was EUR 1.9 million (2008: EUR 1.5 million). Third quarter 2009 highlights: - Turnover for the third quarter was EUR 13.8 million (2008: EUR 16.7 million), a change of -16.9 per cent. - Operating profit before goodwill impairment was EUR 0.5 million (2008: EUR 1.3 million), 3.3 per cent of turnover; operating profit before goodwill impairment decreased -65.6 per cent. - Operating profit was EUR -6.7 million (2008: EUR 1.3 million), -48.7 per cent of turnover. - Net profit was EUR -7.1 million (2008: EUR 0.7 million), -51.0 per cent of turnover. - Earnings per share were EUR -0.76 (2008: EUR 0.07). - Diluted earnings per share were EUR -0.76 (2008: EUR 0.07). - The company continued with the business rationalization program it started at the beginning of the year. The program seeks to achieve some EUR 3 million in annual savings. - The company established, in Jyväskylä, a unit for mechanical engineering and electronics design of smartphones. Ixonos outlook: - Due to the market situation, turnover for the final quarter of this year is forecast to be lower than in the previous year, but also clearly the highest of all quarters this year. Operating profit for the final quarter is expected to be decidedly positive as well as satisfactory considering the market situation. - Turnover for the entire year is envisaged to be lower than in the previous year. Due to the one-off goodwill impairment loss, operating profit for the entire year will be decidedly negative. The operational result, however, is expected to be clearly positive. Kari Happonen, President and CEO: Both because of the economic recession that has followed the global financial crisis and because of weakened demand for ICT services, Ixonos' turnover for this year's first nine months has, as predicted, been lower than in the previous year and profitability has weakened. We expect business for the entire Group to develop favourably in the final quarter, and we expect the Group's turnover in the fourth quarter to be the highest of the year. We also envisage that operative profitability will grow and that operating profit for the entire year before goodwill impairment will be clearly positive. We estimate that the Mobile Terminals & Software business area, which produces R&D services for mobile terminal devices and their software, has managed to gain market share despite the difficult market situation. The unit has also clearly increased its turnover for the review period as well as its operating profit compared to the previous year. We also anticipate that the unit will continue its growth during the final quarter of the year. Our Media & Communities business area, which develops device-independent Internet services related to delivery of digital content and to social networking, has recovered from its downturn -caused by the end of certain long-term customer projects - of earlier this year. The unit's turnover began to climb again in the third quarter. We look forward to excellent performance from the unit during the year's final quarter as well. Our Business Solutions unit, which is responsible for customers in the Finnish manufacturing and service sectors as well as in the ICT industry, took the deepest drop. The unit's customers have cut down strongly on their ICT investments as well as postponed the launch of new software and systems projects. The decreased turnover caused the unit to show a loss in the beginning of the year. Because of this, we started an operational rationalization program already during the first quarter. This program seeks to achieve some EUR 3 million in annual savings. As early as during the review period, adaptation and rationalization activities brought about an improved ratio of chargeable work as well as better operative efficiency. Costs for personnel and subcontracting during the review period were EUR 5.2 million lower than during the corresponding period in the previous year. We believe that the ratio of chargeable work performed by the company's specialist staff as well as the efficiency of our administration and support functions will continue to improve and that the company's operational profitability thus will increase during the final quarter of 2009. According to market forecasts by research institutes, Finland's ICT market is shrinking this year and will begin to grow slightly in 2010. Due to the situation on the Finnish market remaining weak, we have had to downgrade considerably the short-term turnover and operating profit forecasts regarding the Business Solutions area. Although we believe that the unit's turnover and profitability will grow significantly in the long term, we must write off EUR 7.2 million of the EUR 18.3-million goodwill allocated to the unit. This one-off impairment loss has no cash impact, but it causes the unit's operating profit during the review period, as well as that of the entire Group, to become clearly negative. However, the Group's operational result is decidedly positive as well as satisfactory considering the market situation. In September, we established a new unit for the design of next-generation mobile phones in connection with our site in Jyväskylä. This unit expands our smartphone R&D services to cover mechanical engineering and electronics design in addition to software development. The unit will be key as we, together with our international device-manufacturer and operator customers, create devices that inspire consumers with both practical use and pleasure as they take advantage of the ever-increasing supply of services on the wireless Internet. BUSINESS OPERATIONS Ixonos is an ICT service company producing innovative solutions for mobile communications, social media and digital services. Together with its customers, the company develops products and services that inspire the digital experience regardless of place and time. The company's corporate customers capitalize on new business opportunities and new productivity. By offering services that range from concept design, consulting and project management to software production and maintenance, Ixonos strives to be a strategic partner to leading innovators. The company's clientele comprises globally leading mobile and smartphone manufacturers, network suppliers and telecom carriers as well as Finnish finance, industrial and service companies and public administration organizations. Ixonos' sites are located in Helsinki and in six other localities in Finland, as well as in Britain, China, Denmark, Estonia, Germany, Slovakia and the United States. SEGMENTS Since the beginning of 2009, Ixonos' business operations are organized into three segments: Mobile Terminals & Software; Media & Communities; and Business Solutions. The Mobile Terminals & Software business area involves product development services for mobile terminal devices and their software. The Media & Communities business area consists of device-independent Internet services related to delivery of digital content and to social networking. The Business Solutions area comprises development services pertaining to corporate business software and systems as well as to public administration online services. Mobile Terminals & Software Ixonos' Mobile Terminals & Software business area provides its customers with product development services for mobile terminal devices and their software. Despite the difficult market situation, the Mobile Terminals & Software business area managed to gain market share and to increase turnover and operating profit for the review period as compared to the previous year. Turnover increased by 11.0 per cent to EUR 26.5 million (2008: EUR 23.9 million). Operating profit increased by 27.4 per cent to EUR 4.0 million (2008: EUR 3.1 million), 15.0 per cent of turnover. The unit's business operations are expected to develop favourably during the final quarter of the year. The growth of turnover and operating profit is anticipated to continue. The Mobile Terminals & Software segment actively utilized the offering of the Group's international sites in Tallinn, Košice and Beijing. The segment also invested strongly in the development of international sales. The Jyväskylä smartphone R&D centre that we established in September expands the Group's mobile-terminal R&D services to cover mechanical engineering and electronics design in addition to software development. The unit enables us to provide increasingly comprehensive product development services for next-generation smartphones to current international device-manufacturer and operator customers as well as to new ones. Smartphones based on new, powerful chipsets from the world's leading technology suppliers, and on the Android and Symbian operating systems, will be developed in the new unit. Media & Communities Ixonos' Media & Communities business area provides its customers with device-independent Internet services related to the delivery of digital media, entertainment and information as well as to social networking. During the review period, the segment's turnover fell by 28.7 per cent to EUR 6.7 million (2008: EUR 9.3 million). Operating profit decreased by 80.6 per cent to EUR 0.2 million (2008: EUR 1.1 million), 3.2 per cent of turnover. The reduction in turnover was caused by certain individual large customer projects ending in early 2009 as well as by new project launches being delayed in an unstable market situation. The unit's turnover began to increase again in the third quarter. The decreased profitability of the business area was a combined consequence of a decline in business volume, a temporarily diminished billing ratio and a powerful investment in developing the unit's operations in the United States. The unit's turnover and profitability are expected to increase vigorously during the remainder of 2009. The Media & Communities segment actively utilized the offering of the Group's site in Košice. As the global financial crisis subsides, investments in Internet distribution and sales of digital media as well as in social-media Internet services are expected to grow clearly faster than traditional ICT investments. Ixonos offers its customers a uniquely comprehensive service package that enables agile and cost-efficient creation of new Internet services; implementation of a smooth user experience in services and mobile terminals; and flexible further development and maintenance -including business critical hosting - of services. Business Solutions Ixonos' Business Solutions area provides development services pertaining to corporate business software and systems as well as to public administration online services. Due to the economic recession as well as to attenuated general demand for ICT services, demand for the segment's services decreased significantly during the review period. The segment's turnover decreased by 32.8 per cent to EUR 14.4 million (2008: EUR 21.4 million), and operating profit turned negative. According to market forecasts by research institutes such as Market-Visio, Finland's ICT market is shrinking during the present year, and will begin to grow slightly in 2010. The short-term turnover and operating profit forecasts for the Business Solutions area have been downgraded substantially. This is due to the continuously weak market situation in Finland. Although the segment's turnover and operating profit are believed to grow significantly in the long term, it was decided to write EUR 7.2 million off the EUR 18.3 million goodwill allocated to the unit. This one-off impairment loss has no cash impact. The Business Solutions area's operating loss before goodwill impairment increased to EUR 1.3 million (2008: operating profit EUR 0.7 million), -9.3 per cent of turnover, during the review period. Operating loss including goodwill impairment increased to EUR 8.5 million (2008: operating profit EUR 0.7 million), -59.3 per cent of turnover. Although the unit's turnover is envisaged to grow somewhat during the final quarter of 2009, it is also forecast to fall clearly short of the previous year. The unit's final-quarter result is expected to be negative despite the Group's rationalization activities. The Business Solutions area focuses on acceleration of business processes, on document and event management, on electronic business and communications and on specialist services in project management. As all the Group's business areas, the unit vigorously utilizes open-source solutions and, in chosen solution areas, the product platforms of technology partners. The unit aims e.g. to diversify its solution delivery according to the SaaS business model by utilizing the advanced business-critical hosting services of the Group. The Business Solutions unit also aspires to improve its operative efficiency by concentrating maintenance and further development of certain product platforms so that such work is performed at the Group's site in Košice. The unit's e-business and e-government solutions have been received well by public sector customers. TURNOVER Consolidated turnover was EUR 47.6 million (2008: EUR 54.6 million), which is 12.9 per cent less than in the previous year. The Mobile Terminals & Software segment accrued 55.8 per cent (2008: 43.7 per cent) of turnover, the Business Solutions segment accrued 30.2 per cent (2008: 39.2 per cent) and the Media & Communities segment accrued 14.0 per cent (2008: 17.1 per cent). Turnover in the third quarter was EUR 13.8 million (2008: EUR 16.7 million), which is 16.9 per cent less than in the previous year. Turnover by segment -------------------------------------------------------------------------------- | EUR 1,000 | 1-9 2009 | 1-9 2008 | 1-12 2008 | -------------------------------------------------------------------------------- | Mobile Terminals & | 26,544 | 23,903 | 33,830 | | Software | | | | -------------------------------------------------------------------------------- | Media & Communities | 6,651 | 9,325 | 12,679 | -------------------------------------------------------------------------------- | Business Solutions | 14,393 | 21,412 | 28,606 | -------------------------------------------------------------------------------- | Group total | 47,587 | 54,640 | 75,115 | -------------------------------------------------------------------------------- FINANCIAL RESULT Consolidated operating profit before impairment of Business Solutions goodwill was EUR 1.5 million (2008: EUR 3.6 million). Consolidated operating profit was EUR -5.7 million (2008: EUR 3.6 million). Profit before tax was EUR -6.5 million (2008: EUR 2.7 million). Profit for the review period was EUR -6.7 million (2008: EUR 2.0 million). Diluted earnings per share were EUR -0.72 (2008: EUR 0.22). Diluted cash flow from operating activities was EUR 0.21 (2008: EUR 0.16) per share. The two main reasons for the reduced operating profit were the decreased ratio of chargeable work performed by the company's specialist staff at the beginning of the review period, and the goodwill depreciation in the Business Solutions area. Thanks to the operational rationalization program started in the first quarter, the company was able to achieve savings during the review period, particularly concerning personnel and subcontracting costs. These costs were some EUR 5.2 million lower than in the previous year despite on an average 40-person staff increase in comparison to the reference period. The construction of the company's international operations network had a cost effect of some EUR 0.9 million during the review period. Third-quarter operating profit before goodwill impairment was EUR 0.5 million (2008: EUR 1.3 million). Operating profit was EUR -6.7 million (2008: EUR 1.3 million). Profit before tax was EUR -7.0 million (2008: EUR 1.0 million). Profit for the third quarter was EUR -7.1 million (2008: EUR 0.7 million). Diluted third-quarter earnings per share were EUR -0.76 (2008: EUR 0.07). Diluted cash flow from operating activities in the third quarter was EUR 0.13 (2008: EUR -0.04) per share. During the third quarter, an impairment of EUR 7.2 million was recorded for goodwill allocated to the Business Solutions area. Operating profit by segment -------------------------------------------------------------------------------- | EUR 1,000 | 1-9 2009 | 1-9 2008 | 1-12 2008 | -------------------------------------------------------------------------------- | Mobile Terminals & | 3,979 | 3,124 | 4,775 | | Software | | | | -------------------------------------------------------------------------------- | Media & Communities | 215 | 1,111 | 1,601 | -------------------------------------------------------------------------------- | Business Solutions | -8,535 | 696 | 1,240 | -------------------------------------------------------------------------------- | Administration | -1,367 | -1,361 | -1,493 | -------------------------------------------------------------------------------- | Group total | -5,708 | 3,570 | 6,123 | -------------------------------------------------------------------------------- RATIONALIZATION PROGRAM On 12 February 2009, Ixonos commenced co-operation negotiations with its personnel in order to rationalize operations and improve profitability. The negotiations were carried out on an accelerated schedule, and they were completed on 10 March 2009. The co-operation negotiations concerned the Ixonos Group's administration and support functions as well as its sites in Finland. As a result of the negotiations, the bonus program for the entire personnel was abandoned for 2009, and the additional holiday pay accrued for the holiday season 2008-2009 was reduced to a third of its normal amount. Additionally, the company's top management waived one month's salary. As an outcome of the negotiations, 25 employees were dismissed from the Ixonos Group. The dismissals focused on employees producing services for which the company does not expect sufficient future demand and that are under increasing international price pressure. The realized savings amount to some EUR 3 million per year from the second quarter of this year. The negotiations also resulted in an agreement that a maximum of 50 employees could be laid off in April, May or June for not more than five months if demand for the company's services would weaken because of the market situation. By the end of June, the company issued notices of temporary lay-offs to 48 employees. The lay-offs came into force during August. Laid-off employees were offered personal protection against dismissal for six months beginning on the first day of their lay-off. To increase productivity, the company continues to rationalize its operations. RETURN ON CAPITAL Consolidated return on equity (ROE) was -41.0 per cent (2008: 11.7 per cent); return on investment (ROI) was -18.1 per cent (2008: 9.6 per cent). The reduced rates of return mainly resulted from the decreased result due to the impairment of Business Solutions area goodwill. BALANCE SHEET AND FINANCING The balance sheet total was EUR 48.4 million (2008: EUR 61.2 million). Shareholders' equity was EUR 18.5 million (2008: EUR 23.5 million). The equity ratio was 38.2 per cent (2008: 38.4 per cent). The Group's liquid assets at the end of the review period amounted to EUR 2.2 million (2008: EUR 1.4 million). During the review period, the company increased its non-equity funding by EUR 8 million in connection with payment of the additional acquisition price for Cidercone Life Cycle Solutions Oy (later Ixonos Outsourcing Services Ltd). Of the non-equity funding, EUR 4 million are non-current liabilities and EUR 4 million are current liabilities. At the end of the review period, the company had interest-bearing bank loans of EUR 15.7 million in all. The bank loans have covenants attached to them. These covenants are based on the company's equity ratio and on the proportion of interest-bearing bank loans (partly interest-bearing net liabilities) to the 12-month rolling operating profit. GOODWILL On 30 September 2009, the consolidated balance sheet included EUR 22.9 million in goodwill. This is EUR 9.3 million less than at the beginning of the year (31 December 2008: EUR 32.2 million). The goodwill has been decreased by the third-quarter impairment of goodwill allocated to the Business Solutions area as well as by the change in the additional acquisition price for Cidercone Life Cycle Solutions Oy (later Ixonos Outsourcing Services Ltd), a company Ixonos acquired in 2007. At the end of September, the company tested for impairment the goodwill distributed among the Group's business segments. The difficult market situation has caused a heavy decrease in the Business Solution area's turnover and operating profit for 2009. This, together with the significantly weakened forecasts regarding the unit's turnover and operating profit in the short term, had such a significant impact on the unit's value, which is determined through cash flow analysis, that although the company believes that in the long term, the unit will grow strongly and its profitability will be restored, it was decided to write EUR 7.2 million off the EUR 18.3 million goodwill associated with the unit. The impairment loss has no cash impact. On 31 December 2008, the interest-bearing current liabilities in the company's balance sheet included a total of EUR 9.7 million in additional acquisition costs for Cidercone Life Cycle Solutions Oy. On 19 April 2009, the company paid an additional acquisition price of EUR 7.8 million, which was based on Ixonos Plc's view of the correct additional acquisition price. At the end of the review period, the interest-bearing current liabilities in the company's balance sheet no longer include any additional acquisition cost. CASH FLOW During the review period, consolidated cash flow from operating activities was EUR 1.9 million (2008: EUR 1.5 million). The change in cash flow from operating activities was mainly due to the change in the Group's working capital. PERSONNEL The number of personnel averaged 966 (2008: 928) during the review period, and was 969 (2008: 918) at the end of the period. The number of employees was reduced by rationalization action in the Group's Finnish companies and it was increased by staff employed by companies in other countries, particularly in China. At the end of the review period, companies in Finland had 724 employees, and Group companies in other countries employed 245. SHARES AND SHARE CAPITAL Share turnover and price During the review period, the highest price of the company's share was EUR 3.50 (2008: EUR 6.15) and the lowest EUR 1.70 (2008: EUR 3.49). The closing price on 30 September 2009 was EUR 3.01 (2008: EUR 3.90). The average price over the review period was EUR 2.06 (2008: EUR 4.33). The number of shares traded during the review period was 3,389,774 (2008: 3,385,768), which corresponds to 36.4 per cent (2008: 37.4 per cent) of the total number of shares at the end of the review period. According to the closing price on 30 September 2009, the market value of the company's shares was EUR 28,032,398 (2008: EUR 35,290,652). Share capital At the beginning of 2009, the company's registered share capital was EUR 370,123.56, and the number of shares was 9,253,089. During December 2008, a total of 60,000 shares were subscribed for based on the 2002 stock option plan II. The increase in share capital was entered into Finland's Trade Register on 6 March 2009. At the end of the review period, Ixonos' share capital was EUR 372,523.56; the total number of shares was 9,313,089. Option plan 2006 Under the 2006 stock options plan, 140,000 options have been released under AI; 140,000 options have been released under AII; and 60,000 options have been released under BI. Of the series A options, 15,000 AI options and 15,000 AII options have been returned to the company based on the terms of the options. These options have been converted to series B options in accordance with the option terms, and they have been redistributed. The maximum number of shares that can be subscribed for with outstanding options under options plan 2006 is 391,500, which is equivalent to 4.2 per cent of the company's total shares. The subscription period for the 2006 AI options began on 1 October 2007. The subscription period for AII and BI options began on 1 October 2008, and the subscription period for BII options began on 1 October 2009. The subscription price is EUR 4.13 with AI and AII options and EUR 5.10 with BI and BII options. The subscription period for the 2006 options ends on 31 December 2011. Shareholders There were 3,070 shareholders on 30 September 2009 (2008: 2,856). Private persons owned 57 per cent (2008: 57 per cent) and institutions 43 per cent (2008: 43 per cent) of the shares. Foreign ownership was 8 per cent (2008: 3 per cent) of the total number of shares. Board authorizations At the end of the review period, the Board of Directors had no valid authorizations pertaining to the company's shares. SUMMARY OF OTHER EVENTS Expansion of smartphone R&D services On 18 September 2009, Ixonos Plc announced that it would expand its smartphone R&D services and establish a new next-generation smartphone design unit in connection with its site in Jyväskylä. The unit extends the company's services to cover smartphone mechanical engineering and electronics design in addition to software development. In the new unit, Ixonos will design smartphones based on new, powerful chipsets from leading technology suppliers and on the Android and Symbian operating systems, for international device-manufacturer and operator customers. In connection with forming the new unit, Ixonos purchased the hardware of Nokia Corporation's mobile-phone R&D laboratory in Jyväskylä. Ixonos estimates that it will hire approximately 20 specialists in mechanical engineering, electronics design and R&D for its new unit by the end of 2009. The company also plans to increase the unit's specialist staff - to several dozen, depending on the market situation - during 2010. Clarification of the organization structure As part of the Group's operational rationalization program that began in spring, Ixonos' organizational structure was firmed up from 1 September 2009. The administrative and support functions of the Group were unbundled from the Service Production organization into a separate Administration unit. The Service Production unit consists of the Line Management, Service Lines and Project Management Office (PMO) functions, which are responsible for providing the Group's specialist services. Base prospectus On 6 April 2009, Finland's Financial Supervisory Authority approved the base prospectus for Ixonos Plc. Base prospectuses are prescribed in Finland's Securities Markets Act (495/1989). Ixonos Plc's base prospectus contains information on the company, on its business operations and on its financial standing. The prospectus is valid for 12 months after its publication. It is available in electronic form on the company's website, at www.ixonos.com/en/investors/, throughout its validity. The prospectus has not been printed up, but printouts are available from the company's head office (Ixonos Plc, Hitsaajankatu 24, 00810 Helsinki, Finland). The base prospectus has been published only in Finnish; it is not available in other languages. Payment of the additional price related to the acquisition of Cidercone Life Cycle Solutions Oy On 19 April 2009, Ixonos Plc paid EUR 7.8 million as additional acquisition price in accordance with the share purchase agreement, signed on 4 September 2007, for Cidercone Life Cycle Solutions Oy (later Ixonos Outsourcing Services Ltd). Ixonos funded the payment of the additional acquisition price by undertaking EUR 4 million in non-current liabilities as well as EUR 4 million in current liabilities. The borrowings used for funding do not add to the interest-bearing liabilities in the balance sheet, as the entire additional acquisition price had already been included under interest-bearing current liabilities, as IFRS provisions require. This amount paid is based on Ixonos Plc's view of the correct additional acquisition price. Negotiations with the party that sold Cidercone Life Cycle Solutions Oy have not led to consensus on the amount of the additional acquisition price. To solve the disagreement regarding the additional acquisition price, arbitration has been initiated at the Arbitration Institute of the Central Chamber of Commerce of Finland. In their request for arbitration, the sellers claim an additional acquisition price of some EUR 8 million. The company considers the supplementary demand unfounded. Site network expansion In April 2009, the company opened sites in Boston, USA and in Copenhagen, Denmark. The new sites pertain to the company's strategy of operating close to its major customers. In June, the company proceeded to set up a site in Chengdu, China. The establishment of this site is connected to the company's strategy of increasing its production capacity in lower-cost countries. RISK MANAGEMENT AND NEAR-FUTURE UNCERTAINTY FACTORS Ixonos Plc's risk management aims to ensure undisturbed continuity and development of the company's operations, to back up the implementation of the operational targets set by the company and to support increasing the company's value. Details on the risk management organization and process as well as on recognized risks are presented on the company's website, at www.ixonos.com/en/investors/risk_management. Presently, the major uncertainty factors are related to the global financial crisis and to its potential ramifications. The general financial insecurity and tightened credit conditions also influence companies' investments as well as their propensity to invest. The prevailing economic uncertainty affects the information systems development investments of Ixonos' customers too; such investments may be put on hold, or decisions regarding them may be postponed. Ixonos' acquisitions, its rapid growth in 2006-2008 and the upswing in its project operations have increased the company's need for working capital. The company manages this requirement by creating adequate buffers to ensure sufficient funds together with the financiers as well as by facilitating the circulation of working capital. The company's balance sheet also includes a significant amount of goodwill. Even after the impairment that was performed in September on the goodwill allocated to the Business Solutions area, the company's goodwill may be impaired should either internal or external factors reduce the profit expectations of the company or any of its cash-generating units. Goodwill will be tested during the fourth quarter of 2009 and, if necessary, at other times. The company's financial agreements have covenants attached to them. A covenant violation may cause either an increase of the company's financing costs, or a call for swift, either partial or full, repayment of non-equity loans. The biggest risks related to covenant violations are associated with operating profit fluctuation, or with a potential need to increase the company's working capital by non-equity funding, due to the market situation. The company manages risk through negotiations with financiers as well as by maintaining readiness for various financing methods. Ixonos has access to the cash funds its normal operations require. Ixonos Plc paid EUR 7.8 million as the additional acquisition price in accordance with the share purchase agreement, signed on 4 September 2007, for Cidercone Life Cycle Solutions Oy (later Ixonos Outsourcing Services Ltd). This amount is based on Ixonos Plc's view of the correct additional acquisition price. At the end of the review period, the interest-bearing current liabilities in the company's balance sheet no longer include any additional acquisition cost. Negotiations with the selling party have not led to consensus on the amount of the additional acquisition price. To solve the disagreement regarding the additional acquisition price, arbitration has been initiated at the Arbitration Institute of the Central Chamber of Commerce of Finland. In their request for arbitration, the sellers claim an additional acquisition price of some EUR 8 million. The company considers the supplementary demand unfounded. The arbitrator's decision is expected in February 2010 at the earliest. FUTURE PROSPECTS The effects of the global financial crisis also strongly influence the ICT service industry. Because of the economic uncertainty, the predictability of the information technology market remains very low. Gartner research indicates that the total trade volume of the industry has decreased globally in 2009 and will begin to grow moderately in 2010. According to Market Visio, Finland's IT market is shrinking in 2009, but will begin to grow moderately in 2010. Because of the general economic uncertainty, Ixonos' customer companies are more cautious than normally in their software and information systems investments as well as in commencing new projects. Price pressure also affects services, particularly in relation to international customers. Due to the market situation, Ixonos' turnover for the final quarter of this year is forecast to be lower than in the previous year but clearly the highest of all quarters this year. Operating profit for the final quarter is expected to be decidedly positive as well as satisfactory considering the market situation. Turnover for the entire year is envisaged to be lower than in the previous year. Due to the one-off goodwill impairment loss, operating profit for the entire year will be decidedly negative. The operational result, however, is expected to be clearly positive. This year, the company still aims to continue rationalizing its operations, developing services, expanding service production in lower-cost countries and maintaining the cash flow as well as the profitability of its operations. NEXT REPORTS The financial statement bulletin for the period 1 January - 31 December 2009 will be published on 11 February 2010. IXONOS PLC Board of Directors For more information, please contact: Ixonos Plc Kari Happonen, President and CEO telephone +358 424 2231 or +358 400 700 761, email kari.happonen@ixonos.com Timo Leinonen, CFO telephone +358 424 2231 or +358 400 793 073, email timo.leinonen@ixonos.com Distribution NASDAQ OMX Helsinki Main media IXONOS GROUP ABBREVIATED FINANCIAL STATEMENTS 1 JANUARY - 30 SEPTEMBER 2009 Accounting policies The interim report has been prepared in accordance with the recognition and valuation principles in the International Financial Reporting Standards (IFRS). However, the report does not comply with all IAS 34 requirements. Income tax expense is based on the performance-based taxes corresponding to the result for the review period. Since 1 January 2009, the Group has applied the following new standards and revised standards: IFRS 8 (Operating Segments) and IAS 1 (Presentation of Financial Statements). In other respects, the same accounting principles and techniques as in the previous annual financial statements have been applied to the interim report. Preparing the financial statements in accordance with IFRS requires Ixonos' management to make estimates and assumptions affecting the amounts of assets and liabilities on the balance sheet date as well as the amounts of income and expenses for the financial period. In addition, judgment must be used in applying the accounting policies. The estimates and assumptions are based on views at the moment of the interim report, and they may therefore contain risks and uncertainty factors. Actual results may differ from estimates and assumptions. The figures in the income statement and in the balance sheet are consolidated. All group companies are included in the consolidated balance sheet. The original interim report is in Finnish. The interim report in English is a translation. As the figures in the report have been rounded, the sums of individual figures may not equal the sums presented. The interim report is unaudited. CONSOLIDATED INCOME STATEMENT, EUR 1,000 -------------------------------------------------------------------------------- | | 1.1.-30 | 1.1.-30 | Change, | 1.7.- | 1.7.- | 1.1.-31. | | | .9.09 | .9.08 | per cent | 30.9.09 | 30.9.08 | 12.08 | | | | | | | | | -------------------------------------------------------------------------------- | Turnover | 47,587 | 54,640 | -12.9 | 13,840 | 16,651 | 75,115 | -------------------------------------------------------------------------------- | Operating | -46,095 | -51,070 | -9.7 | -13,382 | -15,318 | -68,992 | | costs | | | | | | | -------------------------------------------------------------------------------- | OPERATING | 1,492 | 3,570 | -58.2 | 458 | 1,333 | 6,123 | | PROFIT | | | | | | | | BEFORE | | | | | | | | GOODWILL | | | | | | | | IMPAIRMENT | | | | | | | -------------------------------------------------------------------------------- | GOODWILL | -7,200 | 0 | 0 | -7,200 | 0 | 0 | | IMPAIRMENT | | | | | | | -------------------------------------------------------------------------------- | OPERATING | -5,708 | 3,570 | -259.9 | -6,742 | 1,333 | 6,123 | | PROFIT | | | | | | | -------------------------------------------------------------------------------- | Financial | -817 | -885 | -7.6 | -266 | -367 | -1,406 | | income and | | | | | | | | costs | | | | | | | -------------------------------------------------------------------------------- | Profit | -6,525 | 2,685 | -343.0 | -7,008 | 966 | 4,717 | | before tax | | | | | | | -------------------------------------------------------------------------------- | Income tax | -175 | -717 | -75.5 | -50 | -304 | -1,203 | -------------------------------------------------------------------------------- | PROFIT FOR | -6,701 | 1,968 | -440.4 | -7,058 | 662 | 3,514 | | THE PERIOD | | | | | | | -------------------------------------------------------------------------------- CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME, EUR 1,000 -------------------------------------------------------------------------------- | Profit for | -6,701 | 1,968 | -440,4 | -7,058 | 662 | 3,514 | | the period | | | | | | | -------------------------------------------------------------------------------- | Other | | | | | | | | comprehensiv | | | | | | | | e income | | | | | | | -------------------------------------------------------------------------------- | Change in | 0 | 2 | -100,0 | 0 | 0 | -16 | | translation | | | | | | | | difference | | | | | | | -------------------------------------------------------------------------------- | TOTAL | -6,701 | 1,970 | -440,1 | -7,058 | 662 | 3,498 | | COMPREHENSIV | | | | | | | | E INCOME FOR | | | | | | | | THE PERIOD | | | | | | | -------------------------------------------------------------------------------- CONSOLIDATED STATEMENT OF FINANCIAL POSITION, EUR 1,000 -------------------------------------------------------------------------------- | ASSETS | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | NON-CURRENT ASSETS | | | | -------------------------------------------------------------------------------- | Goodwill | 22,933 | 31,992 | 32,195 | -------------------------------------------------------------------------------- | Intangible assets | 5,321 | 7,143 | 6,632 | -------------------------------------------------------------------------------- | Property, plant and equipment | 3,589 | 1,842 | 3,147 | -------------------------------------------------------------------------------- | Deferred tax assets | 219 | 113 | 41 | -------------------------------------------------------------------------------- | Available-for-sale investments | 110 | 110 | 110 | -------------------------------------------------------------------------------- | TOTAL NON-CURRENT ASSETS | 32,173 | 41,200 | 42,125 | -------------------------------------------------------------------------------- | CURRENT ASSETS | | | | -------------------------------------------------------------------------------- | Trade and other receivables | 13,991 | 18,599 | 17,681 | -------------------------------------------------------------------------------- | Financial assets | 0 | 8 | 0 | -------------------------------------------------------------------------------- | Cash and cash equivalents | 2,214 | 1,355 | 2,913 | -------------------------------------------------------------------------------- | TOTAL CURRENT ASSETS | 16,205 | 19,962 | 20,594 | -------------------------------------------------------------------------------- | TOTAL ASSETS | 48,379 | 61,162 | 62,719 | -------------------------------------------------------------------------------- | EQUITY AND LIABILITIES | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | SHAREHOLDERS' EQUITY | | | | -------------------------------------------------------------------------------- | Share capital | 373 | 362 | 370 | -------------------------------------------------------------------------------- | Share premium reserve | 219 | 121 | 121 | -------------------------------------------------------------------------------- | Share issue | 0 | 831 | 100 | -------------------------------------------------------------------------------- | Invested non-restricted equity | 14,808 | 13,985 | 14,808 | | fund | | | | -------------------------------------------------------------------------------- | Retained earnings | 9,760 | 6,230 | 6,221 | -------------------------------------------------------------------------------- | Profit for the period | -6,701 | 1,968 | 3,514 | -------------------------------------------------------------------------------- | TOTAL SHAREHOLDERS´ EQUITY | 18,459 | 23,498 | 25,135 | -------------------------------------------------------------------------------- | LIABILITIES | | | | -------------------------------------------------------------------------------- | Non-current liabilities | 11,799 | 7,652 | 10,532 | -------------------------------------------------------------------------------- | Current liabilities | 18,121 | 30,012 | 27,052 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 29,920 | 37,664 | 37,584 | -------------------------------------------------------------------------------- | TOTAL EQUITY AND LIABILITIES | 48,379 | 61,162 | 62,719 | -------------------------------------------------------------------------------- STATEMENT OF CHANGES IN CONSOLIDATED SHAREHOLDERS' EQUITY, EUR 1,000 -------------------------------------------------------------------------------- | | Share | Share | Share | Investe | Translat | Retaine | Total | | | capit | premiu | issue | d | ion | d | | | | al | m | | non-res | differen | earning | | | | | reserv | | tricted | ce | s | | | | | e | | equity | | | | | | | | | fund | | | | -------------------------------------------------------------------------------- | Shareholde | 355 | 4,512 | 77 | 8,869 | 0 | 7,734 | 21,548 | | rs' equity | | | | | | | | | at | | | | | | | | | 1 January | | | | | | | | | 2008 | | | | | | | | -------------------------------------------------------------------------------- | Share-base | | | | | | 98 | 98 | | d | | | | | | | | | remunerati | | | | | | | | | on expense | | | | | | | | -------------------------------------------------------------------------------- | Transfer | | -4,512 | | 4,512 | | | | | from the | | | | | | | | | premium | | | | | | | | | fund to | | | | | | | | | the | | | | | | | | | invested | | | | | | | | | non-restri | | | | | | | | | cted | | | | | | | | | equity | | | | | | | | | fund | | | | | | | | -------------------------------------------------------------------------------- | Share | 6 | 121 | 754 | 605 | | | 1,486 | | issue | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | | -1,604 | -1,604 | -------------------------------------------------------------------------------- | Comprehens | | | | | 2 | 1,968 | 1,970 | | ive income | | | | | | | | | for the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Shareholde | 362 | 121 | 831 | 13,985 | 2 | 8,196 | 23,498 | | rs' equity | | | | | | | | | at | | | | | | | | | 30 | | | | | | | | | September | | | | | | | | | 2008 | | | | | | | | -------------------------------------------------------------------------------- | Shareholde | 370 | 121 | 100 | 14,808 | -16 | 9,752 | 25,135 | | rs' equity | | | | | | | | | at 1 | | | | | | | | | January | | | | | | | | | 2009 | | | | | | | | -------------------------------------------------------------------------------- | Share-base | | | | | | 25 | 25 | | d | | | | | | | | | remunerati | | | | | | | | | on expense | | | | | | | | -------------------------------------------------------------------------------- | Share | 2 | 98 | -100 | | | | 0 | | issue | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | | | | -------------------------------------------------------------------------------- | Comprehens | | | | | | -6,701 | -6,701 | | ive income | | | | | | | | | for the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Shareholde | 373 | 219 | 0 | 14,808 | -16 | 3,075 | 18,459 | | rs' equity | | | | | | | | | at 30 | | | | | | | | | September | | | | | | | | | 2009 | | | | | | | | -------------------------------------------------------------------------------- CONSOLIDATED CASH FLOW STATEMENT, EUR 1,000 -------------------------------------------------------------------------------- | | 1.1.- | 1.1.- | 1.1.- | | | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | Cash flow from operating | | | | | activities | | | | -------------------------------------------------------------------------------- | Profit for the period | -6,701 | 1,968 | 3,514 | -------------------------------------------------------------------------------- | Adjustments to cash flow from | | | | | operating activities | | | | -------------------------------------------------------------------------------- | Tax | 175 | 717 | 1,203 | -------------------------------------------------------------------------------- | Depreciation and impairment | 9,562 | 1,577 | 2,464 | -------------------------------------------------------------------------------- | Change in provisions | 0 | 0 | -93 | -------------------------------------------------------------------------------- | Finance income and costs | 817 | 885 | 1,406 | -------------------------------------------------------------------------------- | Other adjustments | 87 | 98 | 98 | -------------------------------------------------------------------------------- | Cash flow from operating | 3,940 | 5,425 | 8,593 | | activities before change in | | | | | working capital | | | | -------------------------------------------------------------------------------- | Change in working capital | -689 | -2,599 | -665 | -------------------------------------------------------------------------------- | Interest received | 6 | 102 | 165 | -------------------------------------------------------------------------------- | Interest paid | -561 | -445 | -596 | -------------------------------------------------------------------------------- | Gains from sales of fixed assets | 5 | - 7 | -21 | -------------------------------------------------------------------------------- | Tax paid | -780 | -797 | -1,229 | -------------------------------------------------------------------------------- | Net cash flow from operating | 1,922 | 1,498 | 6,246 | | activities | | | | -------------------------------------------------------------------------------- | Cash flow from investing | | | | | activities | | | | -------------------------------------------------------------------------------- | Investments in tangible and | -592 | -950 | -4,556 | | intangible assets | | | | -------------------------------------------------------------------------------- | Dividends received | 2 | 0 | 1 | -------------------------------------------------------------------------------- | Change in financial assets | 0 | 143 | 143 | -------------------------------------------------------------------------------- | Acquisition of subsidiaries | -7,836 | -3,100 | -3,109 | -------------------------------------------------------------------------------- | Net cash flow from investment | -8,426 | -3,907 | -7,521 | | activities | | | | -------------------------------------------------------------------------------- | Net cash flow before financing | -6,504 | -2,410 | -1,274 | -------------------------------------------------------------------------------- | Cash flow from financing | | | | | activities | | | | -------------------------------------------------------------------------------- | Dividends paid | 0 | -1,604 | -1,604 | -------------------------------------------------------------------------------- | Increase in long-term borrowings | 4,000 | 464 | 6,417 | -------------------------------------------------------------------------------- | Repayment of long-term borrowings | -1,519 | -950 | -3,400 | -------------------------------------------------------------------------------- | Increase in short-term borrowings | 4,149 | 3,478 | 2,787 | -------------------------------------------------------------------------------- | Repayment of short-term | -825 | 0 | -2,490 | | borrowings | | | | -------------------------------------------------------------------------------- | Share issue | 0 | 46 | 146 | -------------------------------------------------------------------------------- | Net cash flow from financing | 5,806 | 1,434 | 1,856 | | activities | | | | -------------------------------------------------------------------------------- | Change in cash and cash | -699 | -976 | 582 | | equivalents | | | | -------------------------------------------------------------------------------- | Liquid assets at start of period | 2,913 | 2,331 | 2,331 | -------------------------------------------------------------------------------- | Liquid assets at end of period | 2,214 | 1,355 | 2,913 | -------------------------------------------------------------------------------- CONSOLIDATED INCOME STATEMENT, QUARTERLY, EUR 1,000 -------------------------------------------------------------------------------- | | Q3/200 | Q2/200 | Q1/200 | Q4/200 | Q3/200 | | | 9 | 9 | 9 | 8 | 8 | | | 1.7.09 | 1.4.09 | 1.1.09 | 1.10.0 | 1.7.08 | | | - | - | - | 8- | - | | | 30.9.0 | 30.6.0 | 31.3.0 | 31.12. | 30.9.0 | | | 9 | 9 | 9 | 08 | 8 | -------------------------------------------------------------------------------- | Turnover | 13,840 | 16,304 | 17,443 | 20,475 | 16,651 | -------------------------------------------------------------------------------- | Operating costs | -13,38 | -15,25 | -17,45 | -17,92 | -15,31 | | | 2 | 7 | 6 | 2 | 8 | -------------------------------------------------------------------------------- | OPERATING PROFIT BEFORE | 458 | 1,046 | -13 | 2,553 | 1,333 | | GOODWILL IMPAIRMENT | | | | | | -------------------------------------------------------------------------------- | GOODWILL IMPAIRMENT | -7,200 | 0 | 0 | 0 | 0 | -------------------------------------------------------------------------------- | OPERATING PROFIT | -6,742 | 1,046 | -13 | 2,553 | 1,333 | -------------------------------------------------------------------------------- | Finance income and costs | -266 | -228 | -323 | -521 | -367 | -------------------------------------------------------------------------------- | Profit before tax | -7,008 | 818 | -336 | 2,032 | 966 | -------------------------------------------------------------------------------- | Income tax | -50 | -229 | 104 | -486 | -304 | -------------------------------------------------------------------------------- | PROFIT FOR THE PERIOD | -7,058 | 589 | -232 | 1,546 | 662 | -------------------------------------------------------------------------------- SEGMENT REPORT -------------------------------------------------------------------------------- | | 1.1.- | 1.1.- | 1.1.- | | | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | Turnover by segment | | | | -------------------------------------------------------------------------------- | Mobile Terminals & Software | 26,544 | 23,903 | 33,830 | -------------------------------------------------------------------------------- | Media & Communities | 6,651 | 9,325 | 12,679 | -------------------------------------------------------------------------------- | Business Solutions | 14,393 | 21,412 | 28,606 | -------------------------------------------------------------------------------- | Total turnover | 47,587 | 54,640 | 75,115 | -------------------------------------------------------------------------------- | Operating profit by segment | | | | -------------------------------------------------------------------------------- | Mobile Terminals & Software | 3,979 | 3,124 | 4,775 | -------------------------------------------------------------------------------- | Media & Communities | 215 | 1,111 | 1,601 | -------------------------------------------------------------------------------- | Business Solutions | -8,535 | 696 | 1,240 | -------------------------------------------------------------------------------- | Administration | -1,367 | -1,361 | -1,493 | -------------------------------------------------------------------------------- | Total operating profit | -5,708 | 3,570 | 6,123 | -------------------------------------------------------------------------------- | Operating profit, per cent of | -12.0 | 6.5 | 8.2 | | turnover | | | | -------------------------------------------------------------------------------- | Interest and finance income | -817 | -885 | -1,406 | -------------------------------------------------------------------------------- | Profit before tax | -6,525 | 2,685 | 4,717 | -------------------------------------------------------------------------------- | Tax | -175 | -717 | -1,203 | -------------------------------------------------------------------------------- | PROFIT FOR THE PERIOD | -6,701 | 1,968 | 3,514 | -------------------------------------------------------------------------------- CHANGES IN FIXED ASSETS, EUR 1,000 -------------------------------------------------------------------------------- | | Goodwi | Intangi | Property, | Other | Total | | | ll | ble | plant and | tangible | | | | | assets | equipment | assets | | -------------------------------------------------------------------------------- | Book value | 21,067 | 6,282 | 1,332 | 110 | 28,791 | | 1 January 2008 | | | | | | -------------------------------------------------------------------------------- | Additions | 10,925 | 2,274 | 1,186 | | 14,386 | -------------------------------------------------------------------------------- | Disposals | | -106 | -407 | | -513 | -------------------------------------------------------------------------------- | Depreciation and | | -1,307 | -270 | | -1,577 | | amortization during the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Book value | 31,992 | 7,143 | 1,842 | 110 | 41,087 | | 30 September 2008 | | | | | | -------------------------------------------------------------------------------- | Book value | 32,195 | 6,632 | 3,147 | 110 | 42,084 | | 1 January 2009 | | | | | | -------------------------------------------------------------------------------- | Additions | | 281 | 1,232 | | 1,512 | -------------------------------------------------------------------------------- | Disposals | -2,062 | | -19 | | -2,081 | -------------------------------------------------------------------------------- | Impairment | -7,200 | | | | -7,200 | -------------------------------------------------------------------------------- | Depreciation and | | -1,592 | -770 | | -2,362 | | amortization during the | | | | | | | period | | | | | | -------------------------------------------------------------------------------- | Book value | 22,933 | 5,321 | 3,589 | 110 | 31,954 | | 30 September 2009 | | | | | | -------------------------------------------------------------------------------- FINANCIAL RATIOS -------------------------------------------------------------------------------- | | 1.1.- | 1.1.- | 1.1.- | | | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | Earnings per share, diluted, EUR | -0.72 | 0.22 | 0.39 | -------------------------------------------------------------------------------- | Earnings per share, EUR | -0.72 | 0.22 | 0.39 | -------------------------------------------------------------------------------- | Equity per share, EUR | 1.98 | 2.60 | 2.72 | -------------------------------------------------------------------------------- | Cash flow from operating | 0.21 | 0.16 | 0.69 | | activities, per share, diluted, | | | | | EUR | | | | -------------------------------------------------------------------------------- | Return on investment, per cent | -18.1 | 9.6 | 15.9 | -------------------------------------------------------------------------------- | Return on equity, per cent | -41.0 | 11.7 | 15.1 | -------------------------------------------------------------------------------- | Operating profit / turnover, per | -12.0 | 6.5 | 8.2 | | cent | | | | -------------------------------------------------------------------------------- | Net gearing | 88.6 | 79.0 | 74.8 | -------------------------------------------------------------------------------- OTHER INFORMATION -------------------------------------------------------------------------------- | | 1.1.- | 1.1.- | 1.1.- | | | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | PERSONNEL | 966 | 928 | 930 | | Average number of personnel | | | | -------------------------------------------------------------------------------- | Personnel at the end of the period | 969 | 918 | 957 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | COMMITMENTS, EUR 1,000 | 30.9.2009 | 30.9.2008 | 31.12.2008 | -------------------------------------------------------------------------------- | Collateral for own commitments | | | | -------------------------------------------------------------------------------- | Corporate mortgages | 9,900 | 9,800 | 9,800 | -------------------------------------------------------------------------------- | Other collateral | 0 | 369 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Leasing and other rental | | | | | commitments | | | | -------------------------------------------------------------------------------- | Falling due within 1 year | 3,891 | 3,383 | 3,968 | -------------------------------------------------------------------------------- | Falling due within 1-5 years | 7,482 | 7,484 | 8,365 | -------------------------------------------------------------------------------- | Falling due after 5 years | 0 | 0 | 0 | -------------------------------------------------------------------------------- | Total | 11,373 | 10,867 | 12,332 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Nominal value of interest rate | | | | | swap agreement | | | | -------------------------------------------------------------------------------- | Falling due within 1 year | 2,714 | 1,400 | 0 | -------------------------------------------------------------------------------- | Falling due within 1-5 years | 3,321 | 1,450 | 6,443 | -------------------------------------------------------------------------------- | Falling due after 5 years | | | | -------------------------------------------------------------------------------- | Total | 6,036 | 2,850 | 6,443 | -------------------------------------------------------------------------------- | Fair value | -200 | 0 | -141 | -------------------------------------------------------------------------------- CALCULATION OF KEY FIGURES Diluted earnings per share = profit for the period / number of shares, adjusted for issues and dilution, average Earnings per share = profit for the period / number of shares, adjusted for issues, average Shareholders' equity per share = shareholders' equity / number of shares, undiluted, on the closing date Cash flow from operating activities, per share, diluted = net cash flow from operating activities / number of shares, adjusted for issues and dilution, average Return on investment (ROI) = (profit before taxes + interest + other financial expenses) / balance sheet total - non-interest-bearing liabilities, average x 100 Return on equity (ROE) = net profit / shareholders' equity, average x 100 Gearing = interest-bearing liabilities - liquid assets / shareholders' equity x 100
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