Tecnotree Oyj - Financial Statement Release

Tecnotree Corporation Financial Review 1 January – 31 December 2012 (unaudited)

Tecnotree Corporation
Financial Review
6th February, 2013 at 8.30 am


Tecnotree is a global supplier of telecom IT solutions, providing products and
services for charging, billing, customer care, and messaging and content
services.  The company's product portfolio comprises virtually the full range
of business management systems for telecom operators, with standard solutions
for fixed networks, mobile services and broad band and for managing
subscriptions, services and cash flows for prepaid and post-paid customers.
Tecnotree has a strong footing especially in developing markets. 

Strong cash flow in fourth quarter

Fourth quarter

  -- Cash flow after investments was EUR 5.5 (-3.5) million. The company's cash
     and cash equivalents were EUR 11.3 million at year end (EUR 6.7 million on
     31 December 2011).
  -- Net sales were EUR 22.4 (16.1) million. The adjusted operating result for
     the quarter was  -0.3 (-2.0) million. This includes impairment of EUR 3.9
     million on receivables from customers and changes s for previous periods
     totalling EUR 0.3 million that weakened the result. Without these the
     adjusted operating result would have been EUR 3.9 million positive.

Full year 2012

  -- Cash flow after investments was EUR -0.8 (-18.1) million.
  -- The company's financial situation was difficult at times. In June the
     company carried out a share issue through which it obtained EUR 5.4 million in equity after costs. In October the company obtained a credit facility
     for financing working capital of EUR 5.0 million.
  -- The order book at the end of the period stood at EUR 54.2 (31 December
     2011: 40.4) million. Order intake totalled EUR 87.2 (88.5) million.
  -- Net sales in the year totalled EUR 73.4 (62.3) million and the adjusted
     operating result was EUR -4.9 (-1.7) million. Without the EUR 3.9 million
     impairment on receivables from customers, the adjusted operating result
     would have been EUR -1.0 million. The operating result was EUR -12.4
     (-11.1) million and the result for the period EUR -17.0 (-15.6) million.

2013

  -- The order book at the end of 2012 stood at EUR 54.2 million, so the company
     moves into 2013 in a strong position. The company estimates that its net
     sales and operating result will improve from the previous year.

KEY FIGURES                                         10-12/  10-12/  1-12/  1-12/
                                                      2012    2011   2012   2011
Net sales, MEUR                                       22.4    16.1   73.4   62.3
Adjusted operating result, MEUR*                      -0.3    -2.0   -4.9   -1.7
Adjusted operating result without 2012 writedowns,     3.9           -1.0       
 MEUR*                                                                          
Operating result, MEUR                                -3.7    -3.5  -12.4  -11.1
Result before taxes, MEUR                             -3.1    -3.3  -13.7   -9.9
Result for the period                                 -6.3    -7.5  -17.0  -15.6
Earnings per share, basic, EUR **                    -0.05   -0.09  -0.16  -0.18
Order book, MEUR                                                     54.2   40.4
Cash flow after investments, MEUR                      5.5    -3.5   -0.8  -18.1
Change in cash and cash equivalents, MEUR              7.8    -1.0    4.8   -9.8
Cash and cash equivalents, MEUR                                      11.3    6.7
Equity ratio %                                                       42.2   50.7
Net gearing %                                                        47.5   43.1
Personnel at end of period                                          1,116    926

  * Adjusted operating result = operating result before R & D capitalisation,
amortisation of this and one-time costs. Details of these are given in the
section “Result analysis”. 
** The key figure is adjusted for all periods presented to reflect the share
issue. Unless otherwise stated, all figures presented below are for the
reviewed period 1-12/2012 and the figures for comparison are for the
corresponding period 1-12/2011. 

President and CEO Kaj Hagros:
”Net sales rose 39 per cent in the fourth quarter and 18 per cent for the whole
year from the previous year. The order book also continued to grow and was 34
per cent higher at the end of the year than at the end of the previous year.
Orders received during the year and the order book at the end of the year were
higher in 2011 and in 2012 than ever before.  We consider these signs of strong
demand and of the gradual implementation of our change in strategy. The large
orders we have received for new systems require major investments in R & D,
which has raised costs more than was planned. For this reason, and because of
the impairment on receivables from customers, the whole year was loss-making.
Without this impairment the adjusted operating profit for the fourth quarter
would have been EUR 3.9 million. 
Results will improve in the future as the company achieves repeat sales of the
new systems under development. In addition, through projects to optimise
project management, quality, process development and working capital, we are
aiming at continuous improvement of the cash flow, profitability and customer
satisfaction. The company's financial position has improved in consequence of
these measures. Cash flow after investments improved EUR 17.3 million from last
year. Customer activity indicates that growth will continue during 2013.” 

Events after the end of period

No significant events have occurred after the end of the period.

Prospects in 2013

Tecnotree's order book at the end of 2012 stood at EUR 54.2 million, so the
company moves into 2013 in a strong position. The company estimates that its
net sales and operating result will improve from the previous year. Variations
in the quarterly figures will be considerable. 

Proposal concerning the result

The Board of Directors propose to the Annual General Meeting, that no dividend
be paid for the financial year ended 31 December 2012, and that the parent
company's loss for the financial year, EUR 15,445,987.34, be covered by
non-restricted equity reserves. 

Financial information

Tecnotree is holding a conference for analysts and the media to announce its
nine month results at 10.00 am on 6th February 2013 in the Tapiola conference
room at the Scandic Hotel Simonkenttä, Simonkatu 9, Helsinki. The financial
statements review will be presented by CEO Kaj Hagros and the conference will
be held in Finnish. The material to be presented at the press conference will
be available at www.tecnotree.com. 

TECNOTREE CORPORATION

Board of Directors

FURTHER INFORMATION
Kaj Hagros, President and CEO, tel. +358 40 849 1749
Tuomas Wegelius, CFO, tel. +358 400 433 228

DISTRIBUTION
NASDAQ OMX Helsinki Ltd.
Main media
www.tecnotree.com

About Tecnotree
Tecnotree is a global provider of telecom IT solutions for the management of
products, customers and revenue. Tecnotree helps communications service
providers to transform their business towards a marketplace of digital
services. Tecnotree empowers service providers to monetise on service bundles,
provide personalised user experiences and augment value throughout the customer
lifecycle. With over 1100 telecom experts, Tecnotree serves more than 100
service providers in over 70 countries. Tecnotree is listed on the main list of
NASDAQ OMX Helsinki with the trading code TEM1V. For more information on
Tecnotree, please visit www.tecnotree.com

Attachments:

Tecnotree 1-12 2012 Financial Review Presentation.pdf

Tecnotree 1-12-2012 Financial Review.pdf