2014-04-29 08:30:00 CEST
2014-04-29 08:30:05 CEST
REGULATED INFORMATION
QPR Software - Interim report (Q1 and Q3)
NET SALES INCREASED 7% AND PROFITABILITY IMPROVED FROM PREVIOUS YEAR
QPR SOFTWARE PLC STOCK EXCHANGE RELEASE APRIL 29, 2014 AT 9.30 AM
INTERIM REPORT JANUARY - MARCH 2014
NET SALES INCREASED 7% AND PROFITABILITY IMPROVED FROM PREVIOUS YEAR
Summary first quarter 2014
-- Net sales EUR 2,225 thousand (2013: 2,082).
-- Net sales increased 7% mainly due to an increase in software license sales.
-- Recurring revenues (software rentals and maintenance services) increased 4%
and were 54% of total net sales (56). Net sales from software rentals
increased 14%. The growth in recurring revenues was slowed down by exchange
rate changes in maintenance service revenues.
-- Operating profit EUR 107 thousand (-31).
-- Cash flow from operating activities EUR 517 thousand (1,269).
-- Profit before taxes EUR 103 thousand (-42).
-- Profit for the quarter EUR 93 thousand (-36).
-- Earnings per share EUR 0.008 (-0.003).
OUTLOOK
Operating environment and market outlook
The Company estimates that demand for enterprise architecture based business
development services and software will increase in its home market Finland, as
well as elsewhere in Europe. Development of operations in an enterprise
architecture context, and not just in business process or in system development
context, is a necessity in current competitive environment for more and more
organizations. QPR provides its customers, through its software and services,
an insight and control to various dimensions of their organizations, such as
business processes, information, applications and technology.
QPR aims to grow in its home market Finland especially in the enterprise
architecture based business development services and in the process analysis
business. In the international markets, the Company's goal is to significantly
increase the sales of its innovative software products. In the international
markets, the Company operates mainly through its reseller channel and puts
effort in recruiting new resellers.
Outlook for 2014
The Company estimates its net sales and operating profit in euros to increase
in 2014, compared to 2013.
KEY FIGURES
--------------------------------------------------------------------------------
EUR in thousands, unless otherwise Jan-Mar Jan-Mar Change, Jan-Dec
indicated 2014 2013 % 2013
--------------------------------------------------------------------------------
Net sales 2,225 2,082 6.9 8,688
EBITDA 305 142 114.8 1,285
% of net sales 13.7 6.8 14.8
Operating profit 107 -31 578
% of net sales 4.8 -1.5 6.7
Profit before tax 103 -42 554
Profit for the period 93 -36 521
% of net sales 4.2 -1.7 6.0
Earnings per share, EUR 0.008 -0.003 0.043
Equity per share, EUR 0.235 0.236 -0.4 0.231
Cash flow from operating activities 517 1,269 -59.3 1,661
Cash and cash equivalents 1,496 2,443 -38.8 1,365
Free cash flow 282 1,055 -73.3 815
Net borrowings -1,496 -2,104 -28.9 -1,252
Gearing, % -51.2 -71.7 -43.6
Equity ratio, % 55.8 53.1 42.5
Return on equity, % 12.9 -4.9 17.8
Return on investment, % 14.6 -3.4 18.3
--------------------------------------------------------------------------------
REPORTING
This report complies with requirements of IAS 34 ”Interim Financial Reporting”.
Starting from the beginning of 2014, the Group has applied certain new or
revised IFRS standards and IFRIC interpretations as described in the
Consolidated Financial Statements 2013. The implementation of these new and
revised requirements have not impacted the reported figures. For all other
parts, the accounting principles and methods are the same as they were in the
2013 financial statements. This report is unaudited.
QPR Software's business operations consist of software and consulting services
sales. The Company reports income for products and services as follows:
software license sales, software maintenance services, software rentals, and
consulting services.
Starting from the beginning of 2014, the Company also reports fixed-price
extended software maintenance services as part of software maintenance.
Earlier, these services were reported as part of consulting revenues.
Comparative figures for 2013 have not been restated. In the first quarter of
2014, the change increased net sales from software maintenance by EUR 31
thousand and, accordingly, decreased net sales from consulting services with
the same amount.
QPR reports the following operating segments: Direct and OEM business (software
license and rental sales, maintenance and consulting services sales to direct
customers and OEM customers) and Resellers (software license and rental sales,
maintenance and consulting services sales through resellers and the Russian
subsidiary).
REVIEW BY THE CEO
In the first quarter of 2014, the Company's software net sales grew
approximately 10 percent, despite the continued challenging market situation.
Net sales from both software licenses and software rentals grew significantly
from the previous year. This shows that the Company's software for operational
development is in great demand even at economically challenging times.
The Company's consulting net sales were at the previous year's level, and a
twofold development trend was visible. Operational development consulting based
on enterprise architecture continued to grow rapidly, while net sales from
technical consulting declined in a tight market situation.
Going forward, QPR Software will focus more and more in software and consulting
aimed at operational development of organizations. With QPR's tools and
services, the business operations of the customer organizations are modeled,
analyzed, planned, and measured. This helps the customers to succeed in
strategy implementation and business development. Changes and decisions needed
in this development can be implemented in a controlled manner, efficiently, and
in line with chosen strategy.
The Company will seek growth especially through its new software products QPR
EnterpriseArchitect and QPR ProcessAnalyzer, both launched in the 2010s, and
through its expanding operational development consulting. In Finland, the
Company's software products have a leading position in their markets. The
strengthening of this position, together with further expansion of the
enterprise architecture consulting, are the main targets in the Company's home
market in Finland. In the international business, the Company's growth strategy
is entirely based on software sales. During the current year, the Company will
continue expanding its international reseller channel especially for software
aimed at enterprise architecture modeling, and process modeling and analysis.
Jari Jaakkola
CEO
NET SALES
Net sales in the first quarter were EUR 2,225 thousand (2,082) and increased
6.9% from the corresponding period of the previous year. The increase was
especially due to growth in software license net sales, as compared to the
situation in the beginning of the previous year.
Net sales by product group
--------------------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Change, % Jan-Dec
2013
--------------------------------------------------------------------------------
Software licenses 300 198 52 1,034
Software maintenance 764 771 -1 3,021
services
Software rentals 444 390 14 1,656
Consulting 717 722 -1 2,977
--------------------------------------------------------------------------------
Total 2,225 2,082 7 8,688
--------------------------------------------------------------------------------
Demand for software licenses in the developing markets clearly picked up in the
first quarter of 2014, compared to the difficult first quarter in 2013. In the
developed markets, however, more and more customers favor software rentals
instead of purchasing software licenses, which has a negative impact on
software license net sales and, on the other hand, a positive impact on
software rental net sales.
Software maintenance services relate to contract based customer support and
software updates for earlier sold software licenses. Strengthening of the euro
against main export currencies (U.S. dollar, South African rand, Russian ruble,
and Japanese yen) had a negative impact on maintenance service net sales in the
first quarter. Approximately 60% of maintenance service net sales came from
international customers and 40% from Finnish customers.
Rental net sales of QPR's software have grown strongly already for several
years. This development continued also in the first quarter. Of all new
software sales, the share of rental sales is especially large in the Company's
home market Finland. The vast majority of software rentals is based on
continuing agreements signed with the customers. Net sales from software
rentals grew 14% in the first quarter.
Consulting net sales in the first quarter were at the previous year's level.
Especially the consulting for enterprise architecture based operational
development grew strongly, while net sales from technical consulting declined
due to continued difficult market situation.
Total recurring revenues (net sales from software maintenance services and
software rentals) grew 4% in the first quarter. The growth in recurring
revenues was slowed down by exchange rate changes in maintenance service
revenues. The share of recurring revenues was 54% (56) of total net sales.
Net sales by segment
----------------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Change, % Jan-Dec 2013
----------------------------------------------------------------------------
Direct and OEM business 1,453 1,349 8 5,574
Resellers 772 733 5 3,114
----------------------------------------------------------------------------
Total 2,225 2,082 7 8,688
----------------------------------------------------------------------------
In the first quarter, net sales in the Direct and OEM business grew 8%. The
growth was especially strong in net sales from software and consulting for
enterprise architecture based operational development. Net sales from technical
consulting decreased.
Net sales in the Resellers business increased 5% from the previous year, mainly
due to growth in software license net sales. The growth was slowed down by
negative exchange rate changes in maintenance service revenues, and by
unfavorable business development in Russia.
FINANCIAL PERFORMANCE
Operating profit
In the first quarter, the Group's operating profit was EUR 107 thousand (-31),
or 4.8% of net sales (-1.5). Operating profit increased from the previous year
mainly due to higher net sales.
The Group's total expenses declined 1% compared to the previous year. Personnel
expenses were at the previous year's level.
Operating profit by segment
----------------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Change, % Jan-Dec 2013
----------------------------------------------------------------------------
Direct and OEM business 92 18 411 536
Resellers 106 40 165 385
Unallocated -90 -89 1 -343
----------------------------------------------------------------------------
Total 107 -31 578
----------------------------------------------------------------------------
In the first quarter, operating profit in the Direct and OEM business increased
from the previous year, due to growth in net sales.
Operating profit in the Resellers business increased mainly due to higher net
sales from software licenses. Operating profit for the Resellers business
includes credit losses of EUR 3 thousand (21).
Other items in the comprehensive income statement
Net financial expenses in the first quarter were EUR 4 thousand (11). Net
financial expenses included foreign exchange losses of EUR 4 thousand (7).
Profit before taxes in the quarter was EUR 103 thousand (-42).
QPR Software puts significant efforts in developing its software and service
products, and expects to be able to utilize an additional tax deduction on
research and development activities, valid for years 2013 - 2014 in Finland.
Therefore, similar to 2013, the effective tax rate for the quarter was
significantly lower than the Finnish corporate tax rate.
Profit for the first quarter was EUR 93 thousand (-36), and earnings per share
were EUR 0.008 (-0.003).
FINANCE AND INVESTMENTS
Cash flow from operating activities was EUR 517 thousand (1,269) in the first
quarter. Cash and cash equivalents at the end of the quarter were EUR 1,496
thousand (2,443).
Investments in the first quarter totaled EUR 235 thousand (214). More than half
of the investments were made in product development.
At the end of the quarter, the Company had no interest-bearing liabilities. At
the end of comparative first quarter of 2013, interest-bearing liabilities were
EUR 339 thousand. The gearing ratio was -51% (-72). Current liabilities include
deferred revenue in total of EUR 2,072 thousand (2,028). Return on investment
was 15% (-3) in the first quarter.
At the end of the quarter, equity ratio was 56% (53) and the consolidated
shareholders' equity was EUR 2,920 thousand (2,935). Return on equity was 13%
(-5) in the first quarter.
The Annual General Meeting on March 13, 2014 authorized the Board of Directors
to decide on issuing a maximum of 4,000,000 new shares, to decide on conveyance
of a maximum of 700,000 own shares held by the Company, and to decide on
acquiring a maximum of 250,000 own shares. The authorizations are in force
until the next Annual General Meeting.
PRODUCT DEVELOPMENT
Product development expenses in the first quarter were EUR 465 thousand (461),
equal to 21% (22) of net sales. Product development expenses do not include
amortization of capitalized product development expenses.
During the quarter, product development expenses were capitalized for a total
amount of EUR 147 thousand (110). The amortization period for capitalized
product development expenses is four years. The amortization of capitalized
product development expenses in the quarter was EUR 84 thousand (69).
Product development employed 26 persons at the end of the quarter, equal to 33%
of the total personnel.
The Company develops the following software products: QPR EnterpriseArchitect,
QPR Metrics, QPR ProcessDesigner, and QPR ProcessAnalyzer.
By developing its consulting service products, the Company aims to grow its
local business in Finland, and to accelerate its international software sales
by offering complementary service concepts and solutions to its reseller
partners.
PERSONNEL
At the end of the quarter, the Group employed a total of 79 persons (84).
Average number of personnel during the quarter was 81 (84) and personnel
expenses totaled EUR 1,525 thousand (1,528).
For incentive purposes, the Company has a bonus program that covers all
employees. Remuneration of the top management consists of salary, fringe
benefits and a possible annual bonus based on net sales and operating profit
performance. In 2014, the maximum annual bonus of executive management team,
including the CEO, is 60% of the annual base salary. More information on
incentive plans can be found in the Annual Report 2013
(www.qpr.com/investors/key-figures-and-reports.htm).
SHARES AND SHAREHOLDERS
--------------------------------------------------------------------------------
Trading of shares Jan-Mar Jan-Mar Change, Jan-Dec
2014 2013 % 2013
--------------------------------------------------------------------------------
Shares traded, pcs 501,248 183,806 173 624,427
Volume, EUR 464,534 175,137 165 586,842
% of shares 4.0 1.5 5.0
Average trading price, EUR 0.93 0.95 -3 0.94
Treasury shares acquired during the 37,400 16,716 124 133,722
year, pcs
--------------------------------------------------------------------------------
Shares and market capitalization Mar 31, Mar 31, Change, Dec 31,
2014 2013 % 2013
--------------------------------------------------------------------------------
Total number of shares, pcs 12,444,863 12,444,863 - 12,444,863
Treasury shares, pcs 457,009 302,603 51 419,609
Book counter value, EUR 0.11 0.11 - 0.11
Outstanding shares, pcs 11,987,854 12,142,260 -1 12,025,254
Number of shareholders 661 617 7 627
Closing price, EUR 0.93 0.94 -1 0.93
Market capitalization, EUR 11,148,704 11,413,724 -2 11,183,486
Book counter value of all treasury 50,271 33,286 51 46,157
shares, EUR
Total purchase value of all 430,307 273,256 57 395,134
treasury shares, EUR
Treasury shares, % of all shares 3.7 2.4 3.4
--------------------------------------------------------------------------------
The Annual General Meeting held on March 13, 2014 approved the Board's proposal
that a per-share dividend of EUR 0.04 (0.04), a total of EUR 480 thousand
(486), be paid for the financial year 2013. The dividend was paid to
shareholders entered in the Company's shareholder register, maintained by
Euroclear Finland Oy, on the record date of March 18, 2014. The dividend
payment date was April 3, 2014.
OTHER EVENTS DURING THE QUARTER
In January, QPR Software released QPR Suite 2014, which includes the software
tools for architecture based business development, as well as the related
supporting methodology. QPR Suite 2014 is available in over 20 languages.
In January, QPR Software also released a new version of the QPR ProcessAnalyzer
software. Release 2014.1 brings added efficiency to the process analysis with
an integrated data extraction. In addition to the most common IT systems, data
can now also be extracted directly from databases used by the companies.
Automated email notifications and process flow animation raise the control and
visualization of the process performance to a totally new level.
In February, QPR Software announced that Gartner Inc., an international ICT
research and consulting company, has ranked QPR Software in the best tier used
in its report “MarketScope for Enterprise Business Process Analysis”, with the
rating “Positive”. According to Gartner, the potential customers should
consider vendors in this category as a viable choice for their strategic or
tactical investments. Gartner evaluated the vendors on the following criteria:
product/service, overall viability, market understanding, offering (product)
strategy, business model, innovation, and customer experience, with the latter
two having a higher weighting.
In March, QPR Software and Tieto, the largest Nordic IT services company,
signed a cooperation agreement with the aim to offer customers business driven
enterprise architecture services for gaining substantial business benefits. QPR
provides Tieto with QPR EnterpriseArchitect software together with the
methodology for business driven enterprise architecture. The agreement enables
QPR Software, together with Tieto, to offer customers more comprehensive
services, increasing the business benefits that can be gained from enterprise
architecture work.
In March, QPR Software and Affecto Finland Oy signed a cooperation agreement,
through which Affecto can offer its customers data driven approach for analysis
and improvement of processes. QPR provides Affecto with the automated business
process discovery (ABPD) software, QPR ProcessAnalyzer. The agreement enables
QPR Software, together with Affecto, to offer customers a way to bring
transparency to processes and see the process changes, and thereby be able to
have a direct impact on their business performance.
GOVERNANCE
The Annual General Meeting on March 13, 2014 resolved that the Board of
Directors consists of four (4) ordinary members. The AGM re-elected the
following members to the Board of Directors: Kirsi Eräkangas, Jyrki Kontio,
Vesa-Pekka Leskinen and Topi Piela. In its meeting following the Annual General
Meeting, the Board of Directors elected Vesa-Pekka Leskinen as Chairman of the
Board.
The AGM elected KPMG Oy Ab, Authorized Public Accountants, to continue as QPR
Software Plc's auditors, with Kirsi Jantunen, Authorized Public Accountant,
acting as principal auditor.
The AGM authorized the Board to decide on issuing new shares, conveying own
shares held by the Company, and repurchasing the Company's own shares.
All authorizations of the Board and other decisions made by the Annual General
Meeting are available in their entirety on the stock exchange release published
by the Company on March 13, 2014 and available on the investors section of the
Company's web site, http://www.qpr.com/investors/stock-exchange-releases.htm.
SHORT-TERM RISKS AND UNCERTAINTIES
Internal control and risk management in QPR Software aims to ensure that the
Company operates efficiently and effectively, distributes reliable information,
complies with regulations and operational principles, reaches its strategic
goals, reacts to changes in the market and operational environment, and ensures
the continuity of its business.
QPR has identified the following four groups of risks related to its
operations: risks related to business operations (country, customer, service
delivery, personnel, legal and financial risks as well as risks related to the
Company's resellers), risks related to information and products (QPR products,
IPR, data security), risks related to financing (foreign currency, bad debt),
and risks related to new businesses (growth of new business, product
development investments in new business). The Company has an insurance policy
for property, operational and liability risks. The Company monitors country,
customer, personnel and finance risks also in the Russian subsidiary OOO QPR
Software.
Financial risks include reasonable credit risk concerning individual business
partners, which is characteristic to any international business. QPR seeks to
limit this credit risk by continuous monitoring of standard payment terms,
receivables and credit limits. In the first quarter of 2014, EUR 3 thousand
(21) of credit losses were recorded. The amount of trade receivables over 60
days past due was 10% (8) of total trade receivables at the end of the quarter.
Approximately 75% of Group's trade receivables were in euro at the end of the
quarter. At the end of the quarter, the Company had not hedged its non-euro
trade receivables.
No significant changes have taken place in the Company's short-term risks and
uncertainties during the quarter. Risks and risk management related to the
Company's business are further described in the Annual Report 2013, pages 13-15
(http://www.qpr.com/investors/key-figures-and-reports.htm).
FINANCIAL INFORMATION
In 2014, QPR Software will publish interim reports in English and Finnish on
the following dates:
-- Interim Report Q2/2014: Thursday, July 31, 2014
-- Interim Report Q3/2014: Wednesday, October 29, 2014
QPR SOFTWARE PLC
BOARD OF DIRECTORS
Further information:
Jari Jaakkola, CEO
Tel. +358 (0) 40 5026 397
DISTRIBUTION:
NASDAQ OMX Helsinki Ltd
Main Media
Neither this press release nor any copy of it may be taken, transmitted or
distributed, directly or indirectly, in or into the United States of America or
its territories or possessions.
CONSOLIDATED COMPREHENSIVE INCOME STATEMENT
--------------------------------------------------------------------------------
EUR in thousands, unless otherwise Jan-Mar Jan-Mar Change, Jan-Dec
indicated 2014 2013 % 2013
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 2,225 2,082 7 8,688
Other operating income 15 32 -53 32
Materials and services 85 61 39 292
Employee benefit expenses 1,525 1,528 0 5,703
Other operating expenses 325 383 -15 1,439
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
EBITDA 305 142 115 1,285
Depreciation and amortization 197 173 14 707
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 107 -31 578
Financial income and expenses -4 -11 -64 -25
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit before tax 103 -42 554
Income taxes -10 6 -33
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit for the period 93 -36 521
Earnings per share, EUR (basic and 0.008 -0.003 0.043
diluted)
Consolidated statement of
comprehensive income:
Profit for the period 93 -36 521
Other items in comprehensive income
that may
be reclassified subsequently to
profit or loss:
Exchange differences on translating
foreign operations -8 2 -12
Income tax relating to components
of
other comprehensive income - - -
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total comprehensive income 85 -34 509
CONSOLIDATED BALANCE SHEET
--------------------------------------------------------------------------------
EUR in thousands Mar Mar Dec Change
31, 31, 31, ,
2014 2013 2013 %
--------------------------------------------------------------------------------
Assets
Non-current assets:
Intangible assets 1,672 1,540 1,628 3
Goodwill 513 513 513 0
Tangible assets 202 197 207 -2
Other non-current assets 86 122 82 5
--------------------------------------------------------------------------------
Total non-current assets 2,473 2,372 2,431 2
Current assets:
Trade and other receivables 3,336 2,745 4,365 -24
Cash and cash equivalents 1,496 2,443 1,365 10
--------------------------------------------------------------------------------
Total current assets 4,832 5,188 5,730 -16
Total assets 7,305 7,560 8,161 -10
================================================================================
Equity and liabilities
Equity:
Share capital 1,359 1,359 1,359 0
Other funds 21 21 21 0
Treasury shares -430 -273 -395 9
Translation differences -189 -167 -181 4
Invested non-restricted equity fund 5 5 5 0
Retained earnings 2,154 1,990 2,061 5
--------------------------------------------------------------------------------
Equity attributable to shareholders of the 2,920 2,935 2,871 2
parent company
Non-current liabilities:
Borrowings - 113 -
Non-interest-bearing liabilities 38 66 42 -10
--------------------------------------------------------------------------------
Total non-current liabilities 38 179 42 -10
Current liabilities:
Borrowings - 226 113 -100
Advances received 2,072 2,028 1,406 47
Accrued expenses and prepaid income 2,033 1,798 2,976 -32
Trade and other payables 243 393 753 -68
--------------------------------------------------------------------------------
Total current liabilities 4,348 4,445 5,248 -17
Total liabilities 4,385 4,625 5,290 -17
Total equity and liabilities 7,305 7,560 8,161 -10
================================================================================
CONSOLIDATED CASH FLOW STATEMENT
--------------------------------------------------------------------------
EUR in thousands Jan-Mar Jan-Mar Change, Jan-Dec
2014 2013 % 2013
--------------------------------------------------------------------------
Cash flow from operating
activities:
Profit for the period 93 -36 521
Adjustments to the profit 190 166 14 700
Working capital changes 279 1,188 -77 573
Interest and other financial -4 -4 0 -30
expenses paid
Interest and other financial 0 2 -100 8
income received
Income taxes paid -42 -47 -11 -111
--------------------------------------------------------------------------
Net cash from operating 517 1,269 -59 1,661
activities
Cash flow from investing
activities:
Acquired subsidiaries - -3 -3
Purchases of tangible and -235 -214 10 -846
intangible assets
--------------------------------------------------------------------------
Net cash used in investing -235 -217 8 -849
activities
Cash flow from financing
activities:
Repayments of long-term -113 - -226
borrowings
Repurchase of shares -35 -12 192 -134
Dividends paid - - -486
--------------------------------------------------------------------------
Net cash used in financing -148 -12 1133 -847
activities
Net change in cash and cash 133 1,040 -87 -35
equivalents
Cash and cash equivalents at the 1,365 1,404 -3 1,404
beginning of the period
Effects of exchange rate changes -1 -1 0 -4
on cash and cash equivalents
--------------------------------------------------------------------------
Cash and cash equivalents at the 1,496 2,443 -39 1,365
end of the period
--------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
--------------------------------------------------------------------------------
EUR in thousands Share Other Transla Treasur Investe Retain Total
capital funds tion y d ed
differe shares non-res earnin
nces tricted gs
equity
fund
--------------------------------------------------------------------------------
Equity Jan 1, 1,359 21 -169 -261 5 2,026 2,981
2013
Repurchase of -12 -12
shares
Comprehensive 2 -36 -34
income
--------------------------------------------------------------------------------
Equity Mar 31, 1,359 21 -167 -273 5 1,990 2,935
2013
Dividends paid -486 -486
Repurchase of -122 -122
shares
Comprehensive -14 557 543
income
--------------------------------------------------------------------------------
Equity Dec 31, 1,359 21 -181 -395 5 2,061 2,871
2013
Repurchase of -35 -35
shares
Comprehensive -8 93 85
income
--------------------------------------------------------------------------------
Equity Mar 31, 1,359 21 -189 -430 5 2,154 2,920
2014
--------------------------------------------------------------------------------
NOTES TO INTERIM FINANCIAL STATEMENTS
ACCOUNTING PRICIPLES
This report complies with requirements of IAS 34 ”Interim Financial Reporting”.
Starting from the beginning of 2014, the Group has applied certain new or
revised IFRS standards and IFRIC interpretations as described in the
Consolidated Financial Statements 2013. The implementation of these new and
revised requirements have not impacted the reported figures. For all other
parts, the accounting principles and methods are the same as they were in the
2013 financial statements.
When preparing the consolidated financial statements, management is required to
make estimates and assumptions regarding the future and to consider the
appropriate application of accounting principles, which means that actual
results may differ from those estimated.
All amounts presented in this report are consolidated figures, unless otherwise
noted. The amounts presented in the report are rounded, so the sum of
individual figures may differ from the sum reported. This report is unaudited.
During the reporting period, the Group did not have any financial instruments
measured at fair value.
INTANGIBLE AND TANGIBLE ASSETS
-----------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Jan-Dec
2013
-----------------------------------------------------------------------
Increase in intangible assets:
Acquisition cost Jan 1 6,112 5,428 5,428
Increase 221 138 687
Increase in tangible assets:
Acquisition cost Jan 1 1,351 1,234 1,234
Increase 20 76 159
-----------------------------------------------------------------------
CHANGE IN INTEREST-BEARING LIABILITIES
-----------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Jan-Dec
2013
-----------------------------------------------------------------------
Interest-bearing liabilities Jan 1 113 339 339
Repayments -113 - -226
-----------------------------------------------------------------------
Interest-bearing liabilities - 339 113
Mar 31/Dec 31
-----------------------------------------------------------------------
PLEDGES AND COMMITMENTS
--------------------------------------------------------------------------------
EUR in thousands Mar 31, Mar 31, Dec 31, Change
2014 2013 2013 ,
%
--------------------------------------------------------------------------------
Business mortgages (held by the 1,393 1,397 1,394 0
Company)
Minimum lease payments based on
lease
agreements
Maturing in less than one year 167 404 163 2
Maturing in 1-5 years 54 11 38 43
--------------------------------------------------------------------------------
Total 221 415 201 10
Total pledges and commitments 1,614 1,812 1,595 1
--------------------------------------------------------------------------------
CONSOLIDATED INCOME STATEMENT BY QUARTER
--------------------------------------------------------------------------
EUR in thousands Q1 2014 Q4 2013 Q3 2013 Q2 2013 Q1 2013
--------------------------------------------------------------------------
Net sales 2,225 2,310 1,961 2,335 2,082
Other operating income 15 - - - 32
Materials and services 85 86 72 73 61
Employee benefit expenses 1,525 1,482 1,209 1,484 1,528
Other operating expenses 325 348 327 382 383
--------------------------------------------------------------------------
EBITDA 305 395 353 396 142
Depreciation and amortization 197 178 183 174 173
--------------------------------------------------------------------------
Operating profit 107 217 171 222 -31
Financial income and
expenses -4 -11 -3 0 -11
--------------------------------------------------------------------------
Profit before tax 103 206 167 222 -42
Income taxes -10 19 -25 -33 6
--------------------------------------------------------------------------
Profit for the period 93 225 142 189 -36
--------------------------------------------------------------------------
SEGMENT INFORMATION
--------------------------------------------------------------------------------
EUR in thousands Jan-Mar 2014 Jan-Mar 2013 Change, % Jan-Dec 2013
--------------------------------------------------------------------------------
Net sales
Direct and OEM business 1,453 1,349 8 5,574
Resellers 772 733 5 3,114
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Total 2,225 2,082 7 8,688
EBITDA
Direct and OEM business 209 118 77 921
Resellers 186 113 65 708
Unallocated -90 -89 1 -343
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Total 305 142 115 1,285
Operating profit
Direct and OEM business 92 18 411 536
Resellers 106 40 165 385
Unallocated -90 -89 1 -343
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
Total 107 -31 578
Financial income and -4 -11 -64 -25
expenses
Income taxes -10 6 -33
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit for the period 93 -36 521
Other information:
Depreciation and
amortization
Direct and OEM business 117 100 17 384
Resellers 81 73 11 323
-----------------------------------------------------------------------------
Total 197 173 14 707
--------------------------------------------------------------------------------
GROUP KEY FIGURES
--------------------------------------------------------------------------------
EUR in thousands, unless Jan-Mar or Mar Jan-Mar or Mar Jan-Dec or Dec
otherwise indicated 31, 2014 31, 2013 31, 2013
--------------------------------------------------------------------------------
Net sales 2,225 2,082 8,688
Net sales growth, % 6.9 -5.9 -6.8
EBITDA 305 142 1,285
% of net sales 13.7 6.8 14.8
Operating profit 107 -31 578
% of net sales 4.8 -1.5 6.7
Profit before tax 103 -42 554
% of net sales 4.6 -2.0 6.4
Profit for the period 93 -36 521
% of net sales 4.2 -1.7 6.0
Return on equity, % 12.9 -4.9 17.8
Return on investment ,% 14.6 -3.4 18.3
Borrowings - 339 113
Cash and cash equivalents 1,496 2,443 1,365
Free cash flow 282 1,055 815
Net borrowings -1,496 -2,103 -1,252
Equity 2,920 2,935 2,871
Gearing, % -51.2 -71.7 -43.6
Equity ratio, % 55.8 53.1 42.5
Total balance sheet 7,305 7,560 8,161
Investments in non-current 236 214 846
assets
% of net sales 10.6 10.3 9.7
Product development 465 461 1,683
expenses
% of net sales 20.9 22.1 19.4
Average number of personnel 81 84 82
Personnel at the beginning 79 81 81
of period
Personnel at the end of 79 84 79
period
Earnings per share, EUR 0.008 -0.003 0.043
Equity per share, EUR 0.235 0.236 0.231
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