2015-10-20 07:00:02 CEST
2015-10-20 07:00:06 CEST
REGULATED INFORMATION
Comptel - Interim report (Q1 and Q3)
INTERIM REPORT OF COMPTEL CORPORATION 1 JANUARY-30 SEPTEMBER 2015
Stock exchange release
20th October 2015 at 8.00 am
INTERIM REPORT OF COMPTEL CORPORATION 1 JANUARY-30 SEPTEMBER 2015
- Revenue grew by 10.5% in the first nine months of 2015
- Backlog increased by 18.9% compared to last year.
Key figures for the third quarter of 2015:
-- Net sales EUR 22.4 million (Q3 2014: 20.3), growth 10.3%
-- Operating result EUR 0.8 million (2.2), change -63,7%
-- Net profit EUR -0.1 million (0.4), change -116.9%
-- Earnings per share EUR 0.00 (0.01)
-- Order backlog EUR 53.5 million (45.0), growth 18.9%
Key figures for the January-September of 2015:
· Net sales EUR 65.1 million (January - September 2014: 58.9),
growth 10.5%
· Operating result EUR 2.9 million (4.4), change -34.4%
· Net profit EUR 0.6 million (1.2), change -53.4%
· Earnings per share EUR 0.01 (0.01)
Outlook (unchanged)
We expect the 2015 net sales to grow compared to previous year and we expect
operating profit to be in the range of 8-12% of revenue, excluding one-time
charges.
Characteristically a significant part of Comptel's operating profit and net
sales is generated in the second half of the year.
Juhani Hintikka, President and CEO:
” Our business continued to grow in the third quarter. Our revenues grew by
10,5 per cent and our order backlog 18,9 per cent compared to last. We invested
in delivery capacity for customer projects in the remainder of the year. This
reduced our profitability but was necessary in order to efficiently deliver our
increased order backlog. Our revenue mix, in the third quarter, was more
service oriented than on average which lowered our profitability.
Both our product business units are now on a growth track and we expect this
trend to continue. Integrated analytics solution is now live in all regions
with four customers.
For 2014 tax year new decision was made by tax authorities and deductibility
for withholding taxes for certain countries were limited. As a result, we had
to do a EUR 0.4 million onetime tax charge in the third quarter.
Our strategy implementation is developing as planned. We will launch a new data
monetizer product in November in a new marketing event, NexterDay North. In
line with our strategy, we have also made progress, during the year, on the
growth markets as well as with global accounts
During the third quarter, we secured 6 significant orders valued over EUR 0.5
million each.”
Business review of the third quarter and January-September 2015
In the third quarter, Comptel's net sales increased by 10.3 per cent compared
to the respective quarter last year and were EUR 22.4 million (20.3). Comptel
FlowOne solution continued to grow, driving the Service Orchestration Business
Unit growth to 12.7 per cent in this quarter. Strong sales in Fastermind and
Datarefinery in the third quarter contributed to Intelligent Data unit growth
of 7 per cent compared to respective quarter last year.
In January-September, net sales increased by 10.5 per cent from the comparable
period last year and were EUR 65.1 million (58.9). The growth increase for the
year was driven by Comptel FlowOne and Service Orchestration unit.
In the third quarter, the operating result was EUR 0.8 million (2.2), which
corresponds to 3.6 per cent of net sales (11.0). Investments in delivery
capacity decreased the third quarter profitability.
The operating result for January-September was EUR 2.9 million (4.4), which
corresponds to 4.4 per cent of net sales (7.4). The reduction in profitability
in the first nine months is due to investments in growth.
Financial income/expenses were EUR -1.2 million. The main driver for the
expense is foreign currency fluctuation.
In January-September, profit before taxes was EUR 1.7 million (3.2) and net
profit for the period was EUR 0.6 million (1.2). Earnings per share for the
period were EUR 0.01 (0.01).
In the third quarter, EUR 0.4 million one-time tax charge was included in tax
expenses due to new tax ruling of withholding taxes from the Finnish tax
authorities. Tax expenses for January - September was EUR 1.1 million (2.0),
including EUR 0.9 million (1.2) of withholding taxes.
Order backlog increased from the previous year and was EUR 53.5 million (45.0)
at the end of the period. The strong order intake during the year has
contributed to the increase of the backlog.
Comptel strategy
Life is digital moments. Digital demand will be driven by “Generation Cloud”
customers and enterprises interacting with millions of digital applications.
The Internet of Things with billions of connected devices will further
accelerate the digital demand leading to exploding data volumes. Future mobile
and fixed networks will provide hyper speeds and undergo a transformation from
hardware to software. Network functions will be virtualised. Mounting
complexity will require orchestration of business flows and virtualised
resources.
Comptel mission is to perfect the digital moments and translate them into
business moments by connecting digital demand and supply.
The Comptel strategy focuses on providing solutions for digital and
communications service providers in two major areas - Intelligent Data and
Service Orchestration. The Intelligent Data business delivers solutions and
services to customers for monetising data and turning big data into intelligent
automated actions. The Service Orchestration business area provides solutions
and services for business flow orchestration and mastering the digital buying
experience.
Comptel's strategic target is to establish itself as a leading software vendor
for connecting digital demand and supply.
Strategy execution is based on six strategic objectives: solutions with unique
value, thought leadership, customer excellence, new markets, leverage by
partners and inspired people.
Comptel´s marketing strategy strives for industry thought leadership on
carefully selected themes and topics which are: Digital Buying Experience,
Monetising more with less time, Orchestration of service and order flows from
ground to cloud and intelligent fast data. The essence of Comptel's thought
leadership is captured in the book “Operation Nexterday” that was launched in
Barcelona's Mobile World Congress in March 2015.
Business areas
Net sales, 7-9 2015 7-9 Change % 1-9 2015 1-9 2014 Change 1-12
EUR million 2014 % 2014
--------------------------------------------------------------------------------
Europe 8.1 8.1 0.7 24.4 23.5 3.7 35.4
--------------------------------------------------------------------------------
Asia Pacific 7.3 6.8 6.3 20.7 19.0 8.9 24.8
--------------------------------------------------------------------------------
Middle East and 4.6 3.5 32.2 12.0 10.4 15.6 16.8
Africa
--------------------------------------------------------------------------------
Americas 2.5 2.0 24.9 8.0 6.0 33.5 8.8
--------------------------------------------------------------------------------
Total 22.4 20.3 10.3 65.1 58.9 10.5 85.7
--------------------------------------------------------------------------------
Operating result,
EUR million
--------------------------------------------------------------------------------
Europe 5.4 4.5 18.5 15.6 11.9 31.1 19.5
--------------------------------------------------------------------------------
Asia Pacific 3.5 4.5 -21.8 10.7 12.1 -11.7 14.5
--------------------------------------------------------------------------------
Middle East and 2.0 1.0 91.2 3.8 3.9 -4.7 7.3
Africa
--------------------------------------------------------------------------------
Americas 1.0 0.8 25.8 4.1 2.6 55.8 4.0
--------------------------------------------------------------------------------
Unallocated costs -11.1 -8.6 28.1 -31.2 -26.1 19.4 -37.0
--------------------------------------------------------------------------------
Total 0.8 2.2 -63.7 2.9 4.4 -34.4 8.3
--------------------------------------------------------------------------------
Operating result,
% of net sales
--------------------------------------------------------------------------------
Europe 66.1 56.2 - 63.8 50.4 - 55.3
--------------------------------------------------------------------------------
Asia Pacific 48.5 66.0 - 51.5 63.5 - 58.7
--------------------------------------------------------------------------------
Middle East and 43.3 29.9 - 31.3 38.0 - 43.2
Africa
--------------------------------------------------------------------------------
Americas 41.4 41.1 - 50.6 43.3 - 45.5
--------------------------------------------------------------------------------
Total 3.6 11.0 - 4.4 7.4 - 9.7
--------------------------------------------------------------------------------
In the third quarter, net sales grew in all regions. Compared to respective
quarter last year growth was strong especially in Middle East and Africa and
the Americas region. Sales mix and investments in delivery capabilities did
impact the profitability of the regions.
In January - September, net sales increased in all regions. The proportional
profitability declined in Asia Pacific and Middle East while improving in the
other two regions.
In January - September, Comptel received 20 significant orders (January -
September 2014:15): Service Orchestration received 14 orders(ten for the
FlowOne Fulfillment solution, four for FlowOne Provisioning and Activation) and
Intelligent Data received four orders (two for Data Refinery, one for
Fastermind and one for the Monetizer solution). Two orders were multisolution
orders across business units. As significant orders Comptel reports sold
projects and licenses with a minimum value of EUR 0.5 million.
Net sales breakdown, 7-9 7-9 Change % 1-9 1-9 Change 1-12
EUR million 2015 2014 2015 2014 % 2014
------------------------------------------------------------------------------
Project & License business 13.9 11.9 17.0 39.3 33.3 17.8 52.1
------------------------------------------------------------------------------
Recurring business 8.5 8.4 0.8 25.9 25.6 1.0 33.6
------------------------------------------------------------------------------
Total 22.4 20.3 10.3 65.1 58.9 10.5 85.7
------------------------------------------------------------------------------
New Project & License business continues to be the driver for growth.
Net sales breakdown, 7-9 7-9 Change % 1-9 1-9 Change 1-12
EUR million 2015 2014 2015 2014 % 2014
-------------------------------------------------------------------------
Intelligent Data 9.2 8.6 7.0 27.9 27.5 1.4 39.7
-------------------------------------------------------------------------
Service Orchestration 13.2 11.7 12.7 37.2 31.4 18.5 46.0
-------------------------------------------------------------------------
Total 22.4 20.3 10.3 65.1 58.9 10.5 85.7
-------------------------------------------------------------------------
FlowOne Fulfillment solution and Service Orchestration business unit continued
to grow in the third quarter. New sales in Datarefinary and Fastermind
contributed to the Intelligent Data growth in the third quarter.
Financial Position
EUR million 30 Sep 31 Dec Change 30 Sep Change
2015 2014 % 2014 %
--------------------------------------------------------------------------------
Statement of financial position 65.3 77.6 -15.9 62.0 5.2
total
--------------------------------------------------------------------------------
Liquid assets 2.7 9.4 -71.3 5.7 -53.1
--------------------------------------------------------------------------------
Trade receivables, gross 25.1 28.9 -13.1 22.8 10.0
--------------------------------------------------------------------------------
Bad debt provision -1.5 -1.2 30.8 -0.8 95.8
--------------------------------------------------------------------------------
Trade receivables, net 23.6 27.7 -15.0 22.0 6.9
--------------------------------------------------------------------------------
Accrued income 12.5 10.9 14.6 10.3 21.7
--------------------------------------------------------------------------------
Deferred income related to 3.0 4.4 -32.8 2.6 13.9
partial debiting
--------------------------------------------------------------------------------
Interest-bearing debt 5.4 7.6 -28.4 5.6 -2.4
--------------------------------------------------------------------------------
Equity ratio, per cent 64.9 52.4 23.8 59.0 10.1
--------------------------------------------------------------------------------
The statement of financial position on 30 September 2015 was EUR 65.3 million
(62.0), of which liquid assets amounted to EUR 2.7 million (5.7). Operating
cash flow was EUR -1.6 million (3.2) in the third quarter and EUR 0.8 million
(6.6) in January-September.
Trade receivables were EUR 23.6 million (22.0) at the end of the period.
Accrued income was EUR 12.5 million (10.3). Deferred income related to partial
debiting was EUR 3.0 million (2.6).
Comptel has a EUR 25 million credit facility arrangement consisting of EUR 20
million revolving credit facility and EUR 5 million overdraft capacity on
current bank account. Out of this arrangement Comptel had EUR 5 million of the
revolving credit facility outstanding at the end of the period. The credit
facility is valid until July 2018.
The equity ratio was 64.9 per cent (59.0) and the gearing ratio was 8.2 per
cent (-0.6).
Research and Development (R&D)
EUR million 7-9 7-9 Change 1-9 1-9 Change 1-12
2015 2014 % 2015 2014 % 2014
--------------------------------------------------------------------------------
Direct R&D expenditure 4.2 3.9 5.4 12.8 11.7 10.0 16.8
--------------------------------------------------------------------------------
Capitalisation of R&D -1.3 -1.2 13.3 -3.7 -3.4 10.2 -4.7
expenditure according to IAS 38
--------------------------------------------------------------------------------
R&D depreciation and 1.5 1.0 57.6 4.1 3.7 9.6 4.9
impairment charges
--------------------------------------------------------------------------------
R&D expenditure, net 4.3 3.7 16.4 13.2 12.0 9.8 17.0
--------------------------------------------------------------------------------
Direct R&D expenditure, % of 18.6 19.4 - 19.7 19.8 - 19.6
net sales
--------------------------------------------------------------------------------
Direct R&D expenditure represented 19.7 per cent (19.8) of net sales in January
- September.
The focus of Comptel's R&D expenditure was in the further development of
solutions in the main product areas, Service Orchestration and Intelligent
Data. Development is targeted both to secure the recurring revenue with
competitive products and to win new markets by giving customers unique value
with new innovations. Service Orchestration's FlowOne Fulfillment solution is
developed as a suite of orchestration elements that manage the service and
business flows from ground to cloud. Intelligent Data's Data Refinery captures
data-in-motion and uses embedded intelligence to refine it for automated,
in-the-moment decisions and actions. Monetizer is the business policy and
charging tool that allows the rapid innovation and design of rich communication
and data service offers. Data Fastermind embeds artificial intelligence,
prediction and machine learning capabilities into all solutions.
In these areas Comptel seeks global thought leadership in solving the business
challenges of operators and digital communications service providers.
Additionally Comptel has started to invest in new products around the digital
buying experience.
During 2015, we have continued to develop our current offering. During January
- September nine major software releases were launched in these respective
product areas.
EUR million 7-9 7-9 Change 1-9 1-9 Change 1-12
2015 2014 % 2015 2014 % 2014
--------------------------------------------------------------------------------
Gross investments in property, 0.1 0.1 -5.5 0.4 0.4 4.4 0.7
plant and equipment and
intangible assets
--------------------------------------------------------------------------------
Investments
The investments comprised of devices, software and furnishings and were funded
through cash flow from operations.
Personnel
30 Sep 31 Dec Change 30 Sep Change
2015 2014 % 2014 %
--------------------------------------------------------------------------------
Number of employees at the end 748 660 13.3 653 14.5
of period
--------------------------------------------------------------------------------
7-9 1-12 Change 7-9 Change
2015 2014 % 2014 %
-------------------------------------------------------------------------------
Average number of personnel during the period 716 665 7.7 666 7.5
-------------------------------------------------------------------------------
The number of personnel changed due to investment in R&D and delivery capacity.
In the third quarter, personnel expenses were 49.7 per cent of net sales
(48.2). In January - September, personnel expenses were 48.2 per cent of net
sales (48.5).
At the end of the period, 29.4 per cent (29.7) of the personnel were located in
Finland, 26.6 per cent (28.6) in Malaysia, 9.9 per cent (11.5) in Bulgaria,
11.8 per cent (7.2) in India, 2.9 per cent (3.1) in the United Arab Emirates,
and 19.4 per cent (19.9) in other countries where Comptel operates.
Comptel's share
The closing share price of the period was EUR 1.19 (0.64). Comptel's market
value at the end of the period was EUR 127.9 million (68.2).
Comptel share 7-9 7-9 Change 1-9 1-9 Change 1-12
2015 2014 % 2015 2014 % 2014
------------------------------------------------------------------------
Shares traded, million 6.9 3.7 85.5 24.6 20.6 19.0 27.8
------------------------------------------------------------------------
Shares traded, EUR million 8.5 2.3 264.6 28.2 11.5 144.5 16.5
------------------------------------------------------------------------
Highest price, EUR 1.41 0.67 110.4 1.49 0.70 112.9 1.00
------------------------------------------------------------------------
Lowest price, EUR 1.06 0.60 76.7 0.84 0.48 75.0 0.48
------------------------------------------------------------------------
Of Comptel's outstanding shares, 6.0 per cent (3.4) were nominee registered or
held by foreign shareholders at the end of the period.
At the end of the period the company held 118,507 of its own shares, which is
0.11 per cent of the total number of shares. The total counter-book value of
the shares held by the company was EUR 2,358.
3.478.260 share options were distributed during the review period based on
Stock Option Incentive plan 2015.
Corporate Governance
The Annual General Meeting (AGM) of Comptel Corporation was held on 9th of
April 2015. The resolutions of the Annual General Meeting as well as the
minutes of the Annual General Meeting can be found at company's web page
www.comptel.com.
The AGM authorised the Board of Directors to decide on share issues amounting
to a maximum of 21,400,000 new shares and on repurchase or conveying of the
company's own shares up to a maximum number of 10,700,000 shares. The
authorisations are valid until 30th of June 2016. However, the authorisation to
implement the company's share-based incentive programs is valid five years from
the AGM resolution.
A separate stock exchange release about the authorisations given and other
decisions made by the Annual General Meeting was published on 9th of April
2015.
Events after the reporting period
There were no significant events after the reporting period.
Near-term risks and uncertainties
Comptel develops dynamic end-to-end solutions for leading operators globally in
the telecom field. This requires Comptel to understand correctly the trends
taking place in its business environment and the needs of its customers and
resellers by each region. Failure to identify market conditions, address
customers' needs and develop its products in a timely manner may significantly
undermine the growth of Comptel's business and its profitability.
Characteristics of Comptel's field of industry are significant quarterly
variations of net sales and profit, which are related to customers' purchasing
behaviour and the timing of major single deals.
Comptel's business consists of deliveries of large productised IT systems, and
the value of a single project may be several million euros. Therefore, the
credit risk associated with a single project or an individual customer may be
significant. Furthermore, some of Comptel's customers operate in countries
where the political or financial climate can be unstable which in part may
increase credit risk.
Comptel operates globally and so it is exposed to risks arising from different
currency positions. Exchange rate changes between the euro, which is the
company's reporting currency, and the US dollar, UK pound sterling and
Malaysian ringgit affect the company's net sales, expenses and net profit.
The application process to prevent Comptel's double taxation is still pending
with the Ministry of Finance in Finland. However, the process between the
states is very slow and the timing of a decision is hard to forecast. The
interpretation of tax treaties may result in different views between the
countries in question. This could mean that the double taxation will prevail.
Comptel has also applications for return of withholding taxes in other
countries but they are subject to local legal processes, which take time to get
completed. Due to latest decisions by the Finnish tax authorities this risk
impact on corporate effective tax rate is lower.
The risks and uncertainties of Comptel are described in more detail in the
company's financial statements and the Board of Directors' report for 2014.
Outlook (unchanged)
We expect the 2015 net sales to grow compared to previous year and we expect
operating profit to be in the range of 8-12% of revenue, excluding one-time
charges.
Characteristically a significant part of Comptel's operating profit and net
sales is generated in the second half of the year.
Helsinki 20th of October
COMPTEL CORPORATION
Board of Directors
Additional information:
Mr Juhani Hintikka, President and CEO, tel. +358 9 700 1131
Mr Tom Jansson, CFO, tel. +358 40 700 1849
FINANCIAL TABLES
The interim financial statements have been prepared in accordance with IAS 34,
Interim Financial Reporting, as adopted by the EU. The accounting policies and
methods of computation adopted in the financial statements are consistent with
those of the annual financial statements for the year ended 2014.
All figures in the financial report have been rounded and consequently the sum
of the individual figures can deviate from the sum figure. The interim report
is unaudited.
Consolidated Statement of Comprehensive 1 Jan 1 Jan - 1 Jul - 1 Jul -
Income (EUR 1,000) - 30 Sep 30 Sep 30 Sep
30 Sep 2014 2015 2014
2015
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 65,117 58,922 22,422 20,327
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other operating income 23 281 7 -25
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Materials and services -3,990 -2,855 -1,664 -756
--------------------------------------------------------------------------------
Employee benefits -31,38 -28,605 -11,040 -9,807
1
--------------------------------------------------------------------------------
Depreciation, amortisation and impairment -5,084 -4,762 -1,843 -1,600
charges
--------------------------------------------------------------------------------
Other operating expenses -21,82 -18,611 -7,071 -5,903
0
--------------------------------------------------------------------------------
-62,27 -54,833 -21,618 -18,066
4
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit/loss 2,866 4,370 811 2,236
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial income 1,302 879 295 336
--------------------------------------------------------------------------------
Financial expenses -2,476 -2,034 -572 -892
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss before income taxes 1,691 3,216 534 1,680
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income taxes -1,127 -2,005 -600 -1,286
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss for the period 564 1,211 -67 394
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other comprehensive income:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other comprehensive income to be
reclassified to profit or loss in
subsequent periods
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Translation differences 114 674 -555 361
--------------------------------------------------------------------------------
Cash flow hedges 519 - 75 -
--------------------------------------------------------------------------------
Income tax relating to components of other -104 - -14 -
comprehensive income
--------------------------------------------------------------------------------
Total other comprehensive income 529 674 -495 361
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total comprehensive income for the period 1,093 1,885 -562 755
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss attributable to:
--------------------------------------------------------------------------------
Equity holders of the parent company 564 1,211 -67 394
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total comprehensive income attributable to:
--------------------------------------------------------------------------------
Equity holders of the parent company 1,093 1,885 -562 755
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shareholders of the parent company:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR 0.00 0.01 0.0 0.00
--------------------------------------------------------------------------------
Earnings per share, diluted, EUR 0.00 0.01 0.0 0.00
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Consolidated Statement of Financial Position (EUR 30 Sep 2015 31 Dec 2014
1,000)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Assets
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Non-current assets
--------------------------------------------------------------------------------
Goodwill 2,646 2,646
--------------------------------------------------------------------------------
Other intangible assets 12,727 13,435
--------------------------------------------------------------------------------
Tangible assets 1,254 1,596
--------------------------------------------------------------------------------
Investments in associates 673 673
--------------------------------------------------------------------------------
Available-for-sale financial assets 87 87
--------------------------------------------------------------------------------
Deferred tax assets 6,859 5,880
--------------------------------------------------------------------------------
Other non-current receivables 634 613
--------------------------------------------------------------------------------
24,880 24,929
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Current assets
--------------------------------------------------------------------------------
Trade and other current receivables 36,328 43,043
--------------------------------------------------------------------------------
Current tax asset 1,388 315
--------------------------------------------------------------------------------
Cash and cash equivalents 2,683 9,352
--------------------------------------------------------------------------------
40,398 52,710
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total assets 65,279 77,638
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity and liabilities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Equity attributable to equity holders of the
parent company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Share capital 2,141 2,141
--------------------------------------------------------------------------------
Fund of invested non-restricted equity 1,294 401
--------------------------------------------------------------------------------
Fair value reserve -585 -182
--------------------------------------------------------------------------------
Translation differences 234 -699
--------------------------------------------------------------------------------
Retained earnings 30,431 31,685
--------------------------------------------------------------------------------
Total equity 33,515 33,346
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Non-current liabilities
--------------------------------------------------------------------------------
Deferred tax liabilities 2,630 2,669
--------------------------------------------------------------------------------
Non-current financial liabilities 124 1,257
--------------------------------------------------------------------------------
2,754 3,926
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Current liabilities
--------------------------------------------------------------------------------
Provisions 1,065 1,325
--------------------------------------------------------------------------------
Current financial liabilities 5,294 6,305
--------------------------------------------------------------------------------
Trade and other current liabilities 22,650 32,737
--------------------------------------------------------------------------------
29,009 40,367
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total liabilities 31,764 44,292
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total equity and liabilities 65,279 77,638
--------------------------------------------------------------------------------
Consolidated Statement of Cash Flows 1 Jan - 30 1 Jan - 30
(EUR 1,000) Sep Sep
2015 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flows from operating activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit/loss for the period 564 1,211
--------------------------------------------------------------------------------
Adjustments:
--------------------------------------------------------------------------------
Non-cash transactions or items that are not part of cash 6,425 4,641
flows from operating activities
--------------------------------------------------------------------------------
Interest and other financial expenses 206 1,081
--------------------------------------------------------------------------------
Interest income -55 -18
--------------------------------------------------------------------------------
Income taxes 1,168 1,769
--------------------------------------------------------------------------------
Change in working capital:
--------------------------------------------------------------------------------
Change in trade and other current receivables 5,688 2,758
--------------------------------------------------------------------------------
Change in trade and other current liabilities -10,604 -2,358
--------------------------------------------------------------------------------
Change in provisions -141 59
--------------------------------------------------------------------------------
Interest and other financial expenses paid -219 -194
--------------------------------------------------------------------------------
Interest received 63 12
--------------------------------------------------------------------------------
Income taxes paid and tax returns received -2,292 -2,399
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net cash from operating activities 803 6,561
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flows from investing activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Proceeds from sale of business operations - 200
--------------------------------------------------------------------------------
Investments in tangible assets -395 -379
--------------------------------------------------------------------------------
Investments in intangible assets - -
--------------------------------------------------------------------------------
Investments in development projects -3,716 -3,371
--------------------------------------------------------------------------------
Proceeds from the sale of tangible assets 5 34
--------------------------------------------------------------------------------
Change in other non-current receivables 6 -8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net cash used in investing activities -4,100 -3,553
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flows from financing activities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Dividends paid -2,139 -1,073
--------------------------------------------------------------------------------
Shares issued 93 -
--------------------------------------------------------------------------------
Proceeds from share options 800 -
--------------------------------------------------------------------------------
Acquisition of Company's own shares - -146
--------------------------------------------------------------------------------
Proceeds from borrowings 20,102 -
--------------------------------------------------------------------------------
Repayment of borrowings -22,031 -3,012
--------------------------------------------------------------------------------
Lease payments -179 -163
--------------------------------------------------------------------------------
Change in other non-current liabilities - -68
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net cash used in financing activities -3,355 -4,463
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net change in cash and cash equivalents -6,652 -1,454
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash and cash equivalents at the beginning of the period 9,352 6,542
--------------------------------------------------------------------------------
Cash and cash equivalents at the end of the period 2,683 5,720
--------------------------------------------------------------------------------
Change -6,669 -822
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Effects of changes in foreign exchange rates -17 632
--------------------------------------------------------------------------------
Consolidated Statement of Changes in Equity
--------------------------------------------------------------------------------
-
Equity attributable to equity holders of the parent company
--------------------------------------------------------------------------------
-
EUR 1,000 Share Other Translation Retained Total
capital reserves differences earnings
--------------------------------------------------------------------------------
Equity at 2,141 401 -1,219 27,600 28,924
31 Dec 2013
--------------------------------------------------------------------------------
Dividends -1,073 -1,073
--------------------------------------------------------------------------------
Acquisition of -146 -146
Company's own shares
--------------------------------------------------------------------------------
Share-based 198 198
compensation
--------------------------------------------------------------------------------
Prior year correction * -210 -210
--------------------------------------------------------------------------------
Other changes -14 -14
--------------------------------------------------------------------------------
Total comprehensive 674 1,211 1,885
income for the period
--------------------------------------------------------------------------------
Equity at 2,141 401 -545 27,566 29,562
30 Sep 2014
--------------------------------------------------------------------------------
Consolidated Statement of Changes in Equity
-------------------------------------------------------------------------
Equity attributable to equity holders of the parent company
-------------------------------------------------------------------------
EUR 1,000 Share Other Translation Fair value Retain Total
capital reserves differences reserve ed
earnin
gs
--------------------------------------------------------------------------------
Equity at 2,141 401 -698 -182 31,684 33,346
31 Dec 2014
--------------------------------------------------------------------------------
Dividends -2,139 -2,139
--------------------------------------------------------------------------------
Shares issued 93 93
--------------------------------------------------------------------------------
Share-based 800 322 1,122
compensation
--------------------------------------------------------------------------------
Total comprehensive 113 415 564 1,092
income for the
period
--------------------------------------------------------------------------------
Equity at 2,141 1,295 -585 233 30,431 33,515
30 Sep 2015
--------------------------------------------------------------------------------
*Difference in prior year receivables was corrected directly to Retained
Earnings during the quarter.
Notes
1. Application of new or amended standards and interpretations
Comptel has adopted the new or amended standards and interpretations, effective
for the financial years beginning on or after 1 January 2015. However those
have not had an impact on the consolidated financial statements.
2. Segment information
Net sales by segment
EUR 1,000 1 Jan - 1 Jan - 1 Jul - 1 Jul -
30 Sep 2015 30 Sep 2014 30 Sep 2015 30 Sep 2014
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Europe 24,376 23,511 8,108 8,053
--------------------------------------------------------------------------
Asia-Pacific 20,739 19,039 7,278 6,843
--------------------------------------------------------------------------
Middle East and Africa 11,985 10,367 4,567 3,454
--------------------------------------------------------------------------
Americas 8,017 6,004 2,469 1,978
--------------------------------------------------------------------------
Group total 65,117 58,922 22,422 20,327
--------------------------------------------------------------------------
Operating profit/loss by segment
EUR 1,000 1 Jan - 1 Jan - 1 Jul - 1 Jul -
30 Sep 30 Sep 30 Sep 30 Sep
2015 2014 2015 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Europe 15,555 11,851 5,358 4,523
--------------------------------------------------------------------------------
Asia-Pacific 10,679 12,095 3,531 4,514
--------------------------------------------------------------------------------
Middle East and Africa 3,753 3,939 1,977 1,034
--------------------------------------------------------------------------------
Americas 4,053 2,601 1,022 812
--------------------------------------------------------------------------------
Group unallocated expenses -31,174 -26,116 -11,078 -8,647
--------------------------------------------------------------------------------
Group operating profit/loss 2,866 4,370 811 2,236
total
--------------------------------------------------------------------------------
Financial income and expenses -1,174 -1,155 -277 -556
--------------------------------------------------------------------------------
Group profit/loss before income 1,691 3,216 534 1,680
taxes
--------------------------------------------------------------------------------
3. Income tax
Income tax expense according to the statement of comprehensive income for the
period was EUR 1,127 thousand (EUR 2,005 thousand).
In 2006, the Board of Adjustment of the Tax Office for Major Corporations
refused to accept the crediting of taxes withheld at source in taxation of 2004
and 2005.
The application process to prevent Comptel's double taxation is still pending
with the Ministry of Finance in Finland. However, the process between the
states is very slow and the timing of a change is hard to forecast. The
interpretation of tax treaties may result in different views between the
countries in question. This could mean that the double taxation will prevail.
According to the Board of Adjustment's decision currently in force, Comptel
Corporation has expensed taxes withheld at source amounting to EUR 926 thousand
in January - September (EUR 1,207 thousand).
4. Tangible assets
EUR 1,000 1 Jan - 1 Jan -
30 Sep 2015 30 Sep 2014
-----------------------------------
-----------------------------------
Additions 395 379
-----------------------------------
Disposals -147 -17
-----------------------------------
5. Related party transactions
The Comptel Group have a related party relationship with its associate, the
Board of Directors, the Executive Board and also with people and companies
under Comptel management's influence.
Transactions which have been entered into with related parties are as follows:
EUR 1,000 1 Jan - 1 Jan -
30 Sep 2015 30 Sep 2014
-----------------------------------------
-----------------------------------------
Associate
-----------------------------------------
Interest income 6 6
-----------------------------------------
EUR 1,000 30 Sep 2015 31 Dec 2014
-------------------------------------------------
-------------------------------------------------
Associate
-------------------------------------------------
Non-current receivables 119 108
-------------------------------------------------
Remuneration to key management
Key management personnel compensation includes the employee benefits of the
members of the Board of Directors and the Executive Board.
EUR 1,000 1 Jan - 30 Sep 1 Jan - 30 Sep
2015 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Salaries and other short-term employee 1,301 1,336
benefits
--------------------------------------------------------------------------------
Share-based payments 456 429
--------------------------------------------------------------------------------
Total 1,757 1,765
--------------------------------------------------------------------------------
During the period a new incentive program was decided for the CEO, in which
against his own investment new options of 3,478,260 were granted.
Guarantees and other commitments
EUR 1,000 30 Sep 2015 31 Dec 2014
------------------------------------
------------------------------------
Guarantees 13 7
------------------------------------
6. Commitments
Minimum lease payments on non-cancellable office facilities and other operating
leases are payable as follows:
EUR 1,000 30 Sep 2015 31 Dec 2014
----------------------------------------------------
----------------------------------------------------
Less than one year 2,050 2,439
----------------------------------------------------
Between one and five years 1,537 2,962
----------------------------------------------------
Total 3,587 5,401
----------------------------------------------------
The group had no material capital commitments for the purchase of tangible
assets at 30 September 2015 and 30 September 2014.
7. Contingent liabilities
EUR 1,000 30 Sep 2015 31 Dec 2014
---------------------------------------------
---------------------------------------------
Bank guarantees 2,528 2,881
---------------------------------------------
Corporate mortgages 200 200
---------------------------------------------
EUR 1,000 30 Sep 2015 31 Dec 2014
--------------------------------------------------------------------
--------------------------------------------------------------------
Contingent liabilities on behalf of others
--------------------------------------------------------------------
Guarantees 30 34
--------------------------------------------------------------------
8. Fair values of financial assets and liabilities
EUR 1,000 Book Fair Book Fair Book Fair value value value value value value
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec 31 Dec
2015 2015 2014 2014 2014 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial assets
--------------------------------------------------------------------------------
Financial assets at fair
value through profit or
loss
--------------------------------------------------------------------------------
Forward contracts (level 2) 137 137 30 30 25 25
--------------------------------------------------------------------------------
Available-for-sale 87 87 87 87 87 87
financial assets (level
3))
--------------------------------------------------------------------------------
Non-current trade 1,722 1,722 1,130 1,130 1,466 1,466
receivables
--------------------------------------------------------------------------------
Current trade receivables 23,394 23,394 21,699 21,699 27,449 27,449
--------------------------------------------------------------------------------
Other current receivables 1,560 1,560 494 494 4,624 4,624
--------------------------------------------------------------------------------
Cash and cash equivalents 2,683 2,683 5,720 5,720 9,352 9,352
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial liabilities
--------------------------------------------------------------------------------
Financial liabilities at
fair value through profit
or loss
--------------------------------------------------------------------------------
Forward contracts (level 2) - - 211 211 847 847
--------------------------------------------------------------------------------
Trade payables and other 22,165 22,165 23,043 23,043 32,713 32,713
liabilities
--------------------------------------------------------------------------------
Non-current loans from 44 44 1,000 1,003 1,078 1,081
financial institutions
--------------------------------------------------------------------------------
Non-current finance lease - - 215 215 179 179
liabilities
--------------------------------------------------------------------------------
Other non-current 110 110 31 31 - -
liabilities
--------------------------------------------------------------------------------
Current loans from 5,044 5,048 4,044 4,090 5,984 6,095
financial institutions
--------------------------------------------------------------------------------
Current overdraft facility 135 135 - - - -
--------------------------------------------------------------------------------
Current finance lease 77 77 211 211 259 259
liabilities
--------------------------------------------------------------------------------
Other current liabilities 31 31 70 70 63 63
--------------------------------------------------------------------------------
9. Key figures
Financial summary 1 Jan - 1 Jan - 1 Jan -
30 Sep 30 Sep 31 Dec
2015 2014 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales, EUR 1,000 65,117 58,922 85,714
--------------------------------------------------------------------------------
Net sales, change % 10.5 -2.6 3.7
--------------------------------------------------------------------------------
Operating profit/loss, EUR 1,000 2,866 4,370 8,311
--------------------------------------------------------------------------------
Operating profit/loss, change % -34.4 21.2 13.7
--------------------------------------------------------------------------------
Operating profit/loss, as % of net sales 4.4 7.4 9.7
--------------------------------------------------------------------------------
Profit/loss before taxes, EUR 1,000 1,691 3,216 7,436
--------------------------------------------------------------------------------
Profit/loss before taxes, as % of net sales 2.6 5.5 8.7
--------------------------------------------------------------------------------
Return on equity, % - - 17.5
--------------------------------------------------------------------------------
Return on investment, % - - 19.5
--------------------------------------------------------------------------------
Equity ratio, % 64.1 59.0 52.4
--------------------------------------------------------------------------------
Gross investments in tangible and intangible 395 379 740
assets, EUR 1,0001)
--------------------------------------------------------------------------------
Gross investments in tangible and intangible 0.6 0.6 0.9
assets, as % of net sales
--------------------------------------------------------------------------------
Capitalisations according to IAS 38 to intangible 3,716 3,371 4,720
assets, EUR 1,000
--------------------------------------------------------------------------------
Research and development expenditure, EUR 1,000 12,815 11,652 16,791
--------------------------------------------------------------------------------
Research and development expenditure, 19.7 19.8 19.6
as % of net sales
--------------------------------------------------------------------------------
Order backlog, EUR 1,000 53,526 45,019 55,213
--------------------------------------------------------------------------------
Average number of employees during the period 716 666 665
--------------------------------------------------------------------------------
Interest-bearing net liabilities, EUR 1,000 2,735 -169 -1,789
--------------------------------------------------------------------------------
Gearing ratio, % 8.2 -0.6 -5.4
--------------------------------------------------------------------------------
1) The figure does not include investments in development projects.
Per share data 1 Jan - 1 Jan - 1 Jan -
30 Sep 2015 30 Sep 2014 31 Dec 2014
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share (EPS), EUR 0.01 0.01 0.05
--------------------------------------------------------------------------------
EPS diluted, EUR 0.01 0.01 0.05
--------------------------------------------------------------------------------
Equity per share, EUR 0.31 0.28 0.31
--------------------------------------------------------------------------------
Dividend per share, EUR - - 0.02
--------------------------------------------------------------------------------
Dividend per earnings, % - - 39.5
--------------------------------------------------------------------------------
Effective dividend yield, % - - 2.0
--------------------------------------------------------------------------------
P/E ratio - - 19.4
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Adjusted number of shares at the end of 107,603,775 107,421,270 107,421,270
the period
--------------------------------------------------------------------------------
of which the number of treasury shares 118,507 193,412 464,739
--------------------------------------------------------------------------------
Outstanding shares 107,485,268 107,227,858 106,956,531
--------------------------------------------------------------------------------
Adjusted average number of shares during 107,202,754 107,421,270 107,284,900
the period
--------------------------------------------------------------------------------
Average number of shares, dilution 108,769,930 108,597,351 107,625,526
included
--------------------------------------------------------------------------------
10. Definition of key figures
--------------------------------------------------------------------------------
Operating margin % = Operating profit/loss x100
------------------------------------
------------------------------------
Net sales
Profit margin (before income taxes) = Profit/loss before taxes x100
% ------------------------------------
------------------------------------
Net sales
Return on equity % (ROE) = Profit/loss x100
------------------------------------
------------------------------------
Total equity (average during year)
Return on investment % (ROI) = Profit/loss before taxes + x100
financial expenses
------------------------------------
------------------------------------
Total equity + interest bearing
liabilities (average during the
year)
Equity ratio % = Total equity x100
------------------------------------
------------------------------------
Statement of financial position
total - advances received
Gross investments in tangible and = Gross investments in tangible and x100
intangible assets, as % of net intangible assets
sales
------------------------------------
------------------------------------
Net sales
Research and development = Research and development x100
expenditure, as % of net sales expenditure
------------------------------------
------------------------------------
Net sales
Gearing ratio % = Interest-bearing liabilities - x100
cash and cash equivalents
------------------------------------
------------------------------------
Total equity
Earnings per share (EPS) = Profit/loss for the financial year
attributable to equity
shareholders
------------------------------------
------------------------------------
Average number of outstanding
shares for the financial year
Equity per share = Equity attributable to the equity
holders of the parent company
------------------------------------
------------------------------------
Adjusted number of shares at the
end of period
Dividend per share = Dividend
------------------------------------
------------------------------------
Adjusted number of shares at the
end of period
Dividend per earnings % = Dividend per share x100
------------------------------------
------------------------------------
Earnings per share (EPS)
Effective dividend yield % = Dividend per share x100
------------------------------------
------------------------------------
Share closing price at end of
period
P/E ratio = Share closing price at end of
period
------------------------------------
------------------------------------
Earnings per share (EPS)
--------------------------------------------------------------------------------
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