|
|||
2009-12-21 08:00:00 CET 2009-12-21 08:00:03 CET REGULATED INFORMATION Digia Oyj - Company AnnouncementPROFIT WARNING: DIGIA WRITES DOWN GOODWILL RELATING TO ITS MOBILE SOLUTIONS BUSINESSDIGIA PLC STOCK EXCHANGE RELEASE 21 DECEMBER 2009 AT 9.00 A.M. PROFIT WARNING: DIGIA WRITES DOWN GOODWILL RELATING TO ITS MOBILE SOLUTIONS BUSINESS Digia's Board has in its meeting on 20 December 2009 decided on a goodwill write-down amounting to EUR 23,8 million relating to company's Mobile Solutions -business. Write-down is based on the company's view on increased risks relating to Mobile Solutions -business on a long term perspective, which the applicable legislation requires to be used when testing the impairment of goodwill. Increased risks are due to continuously increasing price competition in contract engineering work and the shift of especially low-value-added work and also customers' decision-making to low-cost countries. Company also estimates that the current target market of the company's Mobile Solutions -business as a whole will not grow from its current size in any noteworthy extent. Company will in its Mobile Solutions business concentrate in technologies and services where it can, despite everything, maintain at least satisfactory profitability also in the future. As a result of the above factors the company considers it unlikely that its Mobile Solutions business will meet the assumptions based on which the impairment tests have so far been conducted. These assumptions have been as follows: Annual growth of Net Sales: 3 %, EBIT: 10 % and discount rate: 8,28 %. Following the revised estimations the company has changed the assumptions used in impairment testing of the Mobile Solutions business goodwill as follows: Annual growth of Net Sales: 0 %, EBIT: 9 % in 2010 and 8 % thereafter, and discount rate: 10,86 %. After conducting a new impairment test using the revised assumptions the company has ended up with the need to do the above goodwill write-down relating to company's Mobile Solutions -business. The write-down is a one-off measure and will cause that the company's profit and earning per share for the year 2009 end up being negative. By contrast, said one-off measure have absolutely no effect on company's cash flow nor its operative business, which both are, on a company-level, in a very good shape. Company is also effecting measures to concentrate its network of business locations, which is expected to facilitate even further efficiency and good operative profitability also in the future. Company will continue measures to develop also its Mobile Solutions business. Digia Plc Board of Directors Further information: Juha Varelius, President and CEO Tel. +358 400 855849, E-mail: juha.varelius@digia.com Kjell Lindqvist, CFO Tel. +358 40 8230733, E-mail: kjell.lindqvist@digia.com Distribution: NASDAQ OMX Helsinki Key media |
|||
|