2012-10-26 08:00:04 CEST
2012-10-26 08:00:23 CEST
REGULATED INFORMATION
Digia Oyj - Interim report (Q1 and Q3)
DIGIA THIRD QUARTER 2012: NET INCOME FROM QT DEAL INCREASES CONSOLIDATED NET SALES AND OPERATING PROFIT
Helsinki, 2012-10-26 08:00 CEST (GLOBE NEWSWIRE) -- DIGIA PLC INTERIM REPORT 26
October 2012, 09:00 A.M.
DIGIA THIRD QUARTER 2012: NET INCOME FROM QT DEAL INCREASES CONSOLIDATED NET
SALES AND OPERATING PROFIT
SUMMARY
January-September
- Consolidated net sales: EUR 75.0 (91.7) million, down 18.3 per cent
- Operating profit before extraordinary items: EUR 7.2 (5.6) million, up 28.9
per cent
- Extraordinary items include EUR 0.6 million in restructuring costs due to
reorganisation (1-9/2011: restructuring cost EUR 3.8 million and goodwill
writedown EUR 25.4 million)
- Operating profit after extraordinary items: EUR 6.6 (-23.6) million
- Profitability (EBIT%): 9.6 (6.1) per cent before extraordinary items and 8.9
(-25.7) per cent after extraordinary items
- Product business accounted for 36.6 (19.6) per cent
- Earnings per share: EUR 0.23 (0.21) before extraordinary items and 0.20
(-1.14) after extraordinary items
July-September
- Consolidated net sales: EUR 24.4 (26.0) million, down 6.1 per cent
- Operating profit: EUR 4.5 million (Q3/2011: EUR 2.7 before extraordinary
items and EUR 2.1 million after extraordinary items)
- Profitability (EBIT%): 18.6 per cent (Q3/2011: 10.4 per cent before
extraordinary items and 8.0 per cent after extraordinary items)
- Product business accounted for 47.6 (23.4) per cent
- Earnings per share: EUR 0,15 (Q3/2011: EUR 0.09 before extraordinary items
and EUR 0.06 after extraordinary items)
On 8 August the company made a deal to buy Qt software technology and the
related business from Nokia Plc. The acquisition became effective on 18
September and included a net income sum of EUR 9.2 million related to a license
granted to Nokia. Of this, EUR 3.8 was allocated to the third quarter, bringing
a significant temporary injection into the company's consolidated net sales. It
also increased the Q3 operating profit by EUR 3.2 million.
Even without the aforementioned Qt deal, the company's Qt product business went
well during the review period, with an increase in net sales and a rise in
profitability to a good level. Thanks to the Qt business, the proportion of the
company's product business and international business grew significantly
compared to the same period in the previous year. They now form an important
part of the company's operations, even taking into account the exceptional
results generated by the Qt acquisition.
Despite the positive effect on net sales of the Qt deal in Q3, the company's
overall net sales fell significantly during the review period and slightly
during the third quarter compared to the corresponding periods in the previous
year. This was due to the major decline in demand for mobile contract
engineering services which began in Q2/2011.
After those changes, the company has consistently and successfully adjusted its
operations and organisation to correspond to the new operating environment. On
18 September 2012 the company initiated personnel negotiations with the aim of
reorganising the Qt business. The negotiations apply to the personnel of the Qt
business and the remaining mobile contract engineering business in the
Helsinki, Tampere, Jyväskylä and Oulu offices. The negotiations may lead to
personnel reductions among the 88 affected employees.
The decline in consolidated net sales taking place in spite of the
aforementioned adjustment measures has led to an increase in the proportion of
fixed costs, which in turn hindered the growth of operational profitability
during the review period. Third-quarter profitability was also negatively
affected by a loss provision of EUR 0.8 million related to two customer
deliveries. Profitability was very high in Q3, however, thanks to the Qt
acquisition. Excluding the temporary items of the Qt deal and the loss
provision, the company reached a good level of profitability in Q3.
The transfer of personnel to the company as part of the Qt deal led to an
increase in personnel expenses. These, combined with the costs arising from
taking over the acquired Qt business will have a significant negative impact on
the operating profit and profitability of the Qt business and the company as a
whole, especially in the fourth quarter of 2012. The company predicts that it
may make a temporary operating loss in Q4, but that as the planned streamlining
measures take effect and the Qt business develops, the profitability will rise
again to a good level in 2013.
GROUP KEY FIGURES AND RATIOS
7-9/20 7-9/20 Change 1-9/20 1-9/201 Change 2011
12 11 , % 12 1 , %
--------------------------------------------------------------------------------
Net sales 24,439 26,027 -6.1% 74,997 91,743 -18.3% 121,940
--------------------------------------------------------------------------------
Operating profit 4,545 2,716 67.4% 7,219 5,602 28.9% 8,084
before extraordinary
items
--------------------------------------------------------------------------------
- % of net sales 18.6% 10.4% 9.6% 6.1% 6.6%
--------------------------------------------------------------------------------
Operating profit 4,545 2,073 119.3% 6,640 -23,554 -22,168
--------------------------------------------------------------------------------
- % of net sales 18.6% 8.0% 8.9% -25.7% -18.2%
--------------------------------------------------------------------------------
Net profit 3,072 1,146 168.1% 4,149 -23,669 -22,452
--------------------------------------------------------------------------------
- % of net sales 12.6% 4.4% 5.5% -25.8% -18.4%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Return on equity, % 29.9% 12.1% 13.4% -59.7% -41.9%
--------------------------------------------------------------------------------
Return on capital 29.9% 14.8% 14.3% -41.2% -28.7%
invested, %
--------------------------------------------------------------------------------
Interest-bearing 21,693 21,934 -1.1% 21,693 21,934 -1.1% 21,872
liabilities
--------------------------------------------------------------------------------
Cash and cash 8,471 2,925 189.6% 8,471 2,925 189.6% 8,170
equivalents
--------------------------------------------------------------------------------
Net gearing, % 30.9% 49.6% 30.9% 49.6% 34.5%
--------------------------------------------------------------------------------
Equity ratio, % 51.6% 47.4% 51.6% 47.4% 47.8%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, 0.15 0.06 167.4% 0.20 -1.14 -1.08
EUR, undiluted
--------------------------------------------------------------------------------
Earnings per share, 0.15 0.06 167.4% 0.20 -1.14 -1.08
EUR, diluted
--------------------------------------------------------------------------------
MARKETS AND DIGIA'S BUSINESS
Weak economic prospects have from time to time caused delays in customers'
decision-making and therefore in the start-up of new projects. Customers are
also facing pressure to make cost-savings, which has started to reflect in
their purchase decisions.
The human resources situation has two quite different aspects. On the one hand,
a large number of experts were released onto the job market from various
contract engineering projects; on the other, there is a shortage of experienced
architecture and business experts, which is causing lengthened recruitment
processes and pressure for pay rises.
The company's new organisation took effect at the beginning of 2012. Its
implementation has on the whole progressed well and according to plan, but in
some areas continued measures are needed to increase efficiency and
profitability.
In the bespoke solutions business, the increased cost pressures on customers
clearly had an effect on demand for the company's services during the review
period. Especially when it comes to outsourcing large-scale functions, there is
a lot of cost pressure and price sensitivity among the customers. The company
is focusing on sales and on developing its product selection to correspond even
better to demand.
Demand for ERP systems and other operational systems was fair during the review
period, although increased caution was evident in customers' purchasing
behaviour and sales cycles have become longer.
The Qt business increased its net sales, with operations progressing according
to plan during the period. The profitability of the business improved, as
expected, reaching a very good level. The Qt deal made with Nokia brought a
major temporary boost to Q3 net sales and operating profit.
The focus of development of Digia's Russian unit was on ERP system solutions
for local customers within the retail value chain. The retail product selection
had previously been expanded from BI products to video analytics solutions.
Besides offering services locally, the Russian unit also supports the company's
business in Finland by providing near shore services, particularly within ERP
system solutions.
The focus of development of Digia's Chinese unit was increasingly on Qt
business for the local Chinese market. The completed Qt acquisition reinforces
the company's competitiveness in this area.
NET SALES
Digia's consolidated net sales for the reporting period were EUR 75.0 (91.7)
million, down 18.3 per cent from the same period in 2011.
The decrease was due to a sharp fall in demand for mobile contract engineering
services after the end of the comparison period, which continued into the
current review period. Net sales generated by the Qt business grew
significantly from the comparison period, reaching EUR 14.3 million during the
period under review. Of that figure, EUR 3.8 million came from the granting of
rights of use of Qt technology to Nokia as part of the Qt business acquisition.
During the reporting period, the product business accounted for EUR 27.4 (18.0)
million or 36.6 (19.6) per cent of consolidated net sales.
International operations accounted for EUR 15.4 (9.6) million or 20.5 (10.4)
per cent of consolidated net sales.
Digia's consolidated net sales for the third quarter were EUR 24.4 (26.0)
million, down 6.1 per cent from the same period in 2011.
During the quarter, the product business accounted for EUR 11.6 (6.1) million
of consolidated net sales, or 47.6 (23.4) per cent.
International operations accounted for EUR 4.7 (3.9) million, or 19.4 (14.9)
per cent, of consolidated net sales in Q3.
PROFIT PERFORMANCE AND PROFITABILITY
Digia's consolidated operating profit before extraordinary items for the
reporting period was EUR 7.2 (5.6) million, up 28.9 per cent year on year.
Profitability (EBIT%) before extraordinary items was 9.6 (6.1) per cent.
Digia's consolidated operating profit after extraordinary items for the review
period was EUR 6.6 (-23.6) million. Profitability (EBIT%) after extraordinary
items was 8.9 (-25.7) per cent. Extraordinary items included restructuring
costs of EUR 0.6 million related to the Group Management Team reorganisation as
part of operational streamlining.
Digia's consolidated third-quarter operating profit was EUR 4.5 (Q3/2011 EUR
2.7 million before extraordinary items), representing a year-on-year increase
of 67.4 per cent. Profitability (EBIT%) was 18.6 (10.4) per cent In Q3 of 2011,
operating profit after extraordinary items was EUR 2.1 million and
profitability (EBIT%) was 8.0 per cent.
The growth in operating profit and profitability growth during the review
period was due to the sale of rights of use to Nokia as a consequence of the Qt
business acquisition. The income from this sale had a temporary effect on
operating profit and profitability. Additionally, the company's operating cost
structure and profitability were negatively affected during the period by
investments in the international product business, a relative increase in the
proportion of fixed operating costs, and the costs caused by a higher personnel
turnover at the start of the year. The profitability of the bespoke solutions
business was lower than expected.
Third-quarter profitability was also negatively affected by a loss provision of
EUR 0.8 million related to two customer deliveries.
Consolidated earnings before tax for the period totalled EUR 5.6 (-24.2)
million, and net profit was EUR 4.1 (-23.7) million. Consolidated earnings
before tax for the third quarter were EUR 4.2 (2.0) million, and net profit EUR
3.1 (1.1) million.
Consolidated earnings per share for the review period totalled EUR 0.23 (0.21)
before extraordinary items and EUR 0.20 (-1.14) after extraordinary items.
Consolidated earnings per share for the third quarter were EUR 0.15 (0.09). In
Q3 2011, the consolidated earnings per share after extraordinary items were EUR
0.06.
The Group's net financial expenses for the reporting period were EUR 1.0 (0.6)
million and for the third quarter EUR 0.4 (0.1) million.
FINANCIAL POSITION AND EXPENDITURE
At the end of the reporting period, Digia Group's consolidated balance sheet
total stood at EUR 96.2 million (12/2011: EUR 87.8 million), and the equity
ratio was 51.6 (12/2011: 47.8) per cent. Net gearing was 30.9 (12/2011: 34.5)
per cent. Period-end cash and cash equivalents totalled EUR 8.5 (12/2011: 8.2)
million.
Interest-bearing liabilities amounted to EUR 21.7 (12/2011: 21.9) million.
These consisted of EUR 20.5 million in loans from financial institutions and
EUR 1.2 million in financial leasing liabilities.
The Group's cash flow from operations for the period was positive by EUR 17.7
(3.2) million, cash flow from investments was negative by EUR 15.8 (2.4)
million, and cash flow from financing was negative by EUR 1.6 (7.6) million.
Billing of EUR 12.2 million from Nokia in relation to the Qt acquisition deal
had a positive impact on operational cash flow. Cash flow from financing was
negatively affected by the repayment of loans for a total sum of EUR 3.5
million, as well as the payment of EUR 2.1 million in dividends. Additionally,
a long-term loan of EUR 4.0 million was taken out during the period for the Qt
acquisition.
The Group's investments in fixed assets during the review period totalled EUR
0.4 (2.1) million. Acquisitions of tangible fixed assets totalled EUR 0.3 (1.8)
million. Cash flow from investments into intangible rights was EUR 15.4
million.
Return on investment (ROI) for the period was 14.3 (-41.2) per cent, and return
on equity (ROE) was 13.4 (-59.7) per cent.
The Group carries out quarterly impairment testing of goodwill and intangible
assets with an indefinite useful life. The table below shows the distribution
of goodwill and values subject to testing at the end of the reporting period:
EUR Specified Amortisations during Goodwi Other Total value
1,000 intangible the reporting period ll items subject to
assets testing
--------------------------------------------------------------------------------
Group 7,273 1,166 54,025 7,610 68,908
total
--------------------------------------------------------------------------------
Present values were calculated for the forecast period based on the following
assumptions: Net sales and operating profit for the first three quarters of the
forecast period according to the confirmed figures for the current year, and
for the fourth quarter according to budget; after this, annual growth in net
sales of 3.0 per cent and in operating profit of 10.0 per cent, and a pre-tax
discount rate of 8.9 per cent. Cash flows after the forecast period were
estimated by means of cash-flow extrapolation, applying the assumptions given
above.
According to a completed sensitivity analysis, the goodwill requires either net
sales to remain at the current level with profitability of 5.5 per cent, or a
7.1 per cent growth in net sales with profitability of 0.1 per cent. The
management sees no risk of goodwill impairment.
HUMAN RESOURCES, MANAGEMENT, AND ADMINISTRATION
At the end of the period, the total number of Group personnel was 1,044,
representing a decrease of 131 employees, or 11.1 per cent, since the end of
2011 (1,175). During the reporting period, the number of employees averaged
1,030, a decrease of 423 employees or 29.1 per cent from the 2011 average
(1,453).
Employees by function at the end of the period:
Business units 96 %-----------------------------------
Administration and management 4 %
-----------------------------------
As of the end of the period, 230 employees were working abroad (12/2011: 161).
The Digia Plc Annual General Meeting of 13 March 2012 re-elected Robert Ingman,
Kari Karvinen, Pertti Kyttälä and Tommi Uhari as members of the Board. Päivi
Hokkanen, Seppo Ruotsalainen and Leena Saarinen were elected as new members. At
the organisation meeting of the Board, Pertti Kyttälä was elected Chairman of
the Board and Robert Ingman Vice Chairman.
Juha Varelius has been Digia Plc's President and CEO since 1 January 2008.
Anja Wasenius started as Acting CFO in June 2012.
Ernst & Young Oy, authorised public accountants, are the Group's auditors, with
Authorised Public Accountant Heikki Ilkka as the principal auditor.
RISKS AND UNCERTAINTIES
The company's short-term business risks and uncertainties were described in the
Financial Statements for 2011. These are essentially unchanged.
Due to the Qt business acquisition that became effective in the third quarter,
however, the Qt business will have an increasingly significant influence on the
company's operations and financial performance. This means that any shifts in
the competitive scenario or market for that business may have a major impact on
the company's future net sales and profitability.
The company considers Qt technology to have significant potential and business
opportunities, which the company hopes to utilise with the completed deal. If
the business fails to develop according to the company's expectations, the
investments made in the Qt business and the related costs may prove to be a
significant burden operational profitability in the short term.
FUTURE PROSPECTS
The company's principal objective for 2012 has been to increase its scalable
product business. Besides pursuing organic growth, the company will continue
actively to look out for opportunities to make carefully considered business
acquisitions that support its strategy. The main cornerstones of the company's
operations are still high profitability and a positive cash flow.
The company expects the IT market to remain at roughly the level of 2011 in
2012-13. However, risks associated with the Eurozone debt crisis and general
inflation may affect demand for IT services and the development of business
profitability. Slightly greater uncertainty is therefore related to the
economic prospects.
The company expects demand for its ERP systems, operational systems and
integration services to remain good, although increased caution on the customer
side and lengthening sales cycles may have an effect on future order intake.
In the last quarter of this year the company will complete the necessary
measures for adjusting its mobile contract engineering business to the
prevailing market situation.
The company will continue to seek expansion in the growing Russian market,
especially through its Business Intelligence solutions, ERP systems and
complementary products and services in the trade and logistics customer
segments.
The Chinese unit will continue to be realigned to increasingly serve the Qt
business.
The company expects net sales from the Qt business to continue growing. The
transfer of personnel to the company as part of the Qt acquisition have,
however, led to an increase in personnel expenses. These, combined with the
costs arising from taking over the acquired Qt business, will have a
significant negative impact on the operating profit and profitability of the Qt
business and the company as a whole, especially in the fourth quarter of 2012.
The company predicts that it may make a temporary operating loss in Q4, but
that as the planned streamlining measures take effect and the Qt business
develops, the profitability will rise again to a good level in 2013.
OTHER EVENTS DURING THE REVIEW PERIOD
Convening on 13 March 2012, the Digia Plc Annual General Meeting (AGM) approved
the financial statements for 2011, released the Board members and the CEO from
liability, determined Board emoluments, resolved to keep the number of Board
members at seven, and elected the Board of Directors for the new term.
With regard to profit distribution for 2011, the AGM approved the Board's
proposal to make a repayment of capital of EUR 0.10 per share to all
shareholders listed on the shareholder list maintained by Euroclear Finland Ltd
on the reconciliation date of 16 March 2012. The date for the repayment of
capital was set to be 23 March 2012.
The AGM granted the following authorisations to the Board:
Authorisation of the Board of Directors to decide on buying back own shares
and/or accepting them as collateral
The AGM authorised the Board to decide on the buyback and/or acceptance as
collateral of not more than 2,000,000 shares in the company. This buyback can
only be executed by means of the company's unrestricted equity. The Board shall
decide on how these shares are to be bought. Own shares may be bought back in
disproportion to the holdings of the shareholders. The authorisation also
includes acquisition of shares through public trading organised by NASDAQ OMX
Helsinki Oy in accordance with the rules and instructions of NASDAQ OMX
Helsinki and Euroclear Finland Ltd, or through offers made to shareholders.
Shares may be acquired in order to improve the company's capital structure, to
fund acquisitions or other business transactions, for offering share-based
incentive schemes, to sell on, or to be annulled. The shares must be acquired
at the market price in public trading. This authorisation supersedes that
granted by the AGM of 16 March 2011 and is valid for 18 months - i.e. until 13
September 2013.
Authorising the Board of Directors to decide on a share issue and granting of
special rights
The AGM authorised the Board to decide on an ordinary or bonus issue of shares
and the granting of special rights (as defined in Section 1, Chapter 10 of the
Limited Liability Companies Act) in one or more instalments, as follows: The
issue may total, at a maximum, 4,000,000 shares. The authorisation applies both
to new shares and to treasury shares held by the company. By virtue of the
authorisation, the Board has the right to decide on share issues and the
granting of special rights, in deviation from the pre-emptive subscription
rights of the shareholders (a directed issue). The authorisation may be used to
fund or complete acquisitions or other business transactions, for offering
share-based incentive schemes, to develop the company's capital structure, or
for other purposes. The Board was authorised to decide on all terms related to
the share issue or special rights, including the subscription price, its
payment in cash or (partly or wholly) in capital contributed in kind or its
being written off against the subscriber's receivables, and its recognition in
the company's balance sheet. This authorisation supersedes that granted by the
AGM of 16 March 2011 and is valid for 18 months - i.e. until 13 September 2013.
SHARE CAPITAL AND SHARES
On 30 September 2012, the number of Digia Plc shares totalled 20,875,645.
At the end of the period, according to Finnish Central Securities Depository
Ltd, Digia had 5,910 shareholders.
The 10 biggest shareholders were:
Shareholder Shares and votes
--------------------------------------------------------------
Ingman Group Oy Ab 16.5%
--------------------------------------------------------------
Jyrki Hallikainen 10.2%
--------------------------------------------------------------
Pekka Sivonen 8.8%
--------------------------------------------------------------
Kari Karvinen 6.5%
--------------------------------------------------------------
Matti Savolainen 6.1%
--------------------------------------------------------------
Ilmarinen Mutual Pension Insurance Company 4.8%
--------------------------------------------------------------
Varma Mutual Pension Insurance Company 3.6%
--------------------------------------------------------------
Nordea Bank Finland Plc (nominee-registered) 1.5%
--------------------------------------------------------------
Etola Oy 1.0%
--------------------------------------------------------------
Olli Ahonen 0.9%
--------------------------------------------------------------
Distribution of holdings by number of shares held on 30 September 2012
Number of shares Shareholders Shares and votes
-----------------------------------------------------
1 - 100 22.3% 0.4%
-----------------------------------------------------
101 - 1,000 59.0% 7.6%
-----------------------------------------------------
1,001 - 10,000 17.4% 13.2%
-----------------------------------------------------
10,001 - 100,000 1.0% 8.9%
-----------------------------------------------------
100,001 - 1,000,000 0.3% 21.7%
-----------------------------------------------------
1,000,001 - 4,000,000 0.1% 48.1%
-----------------------------------------------------
Shareholding by sector on 30 September 2012
Shareholders Shares
--------------------------------------------------------------------
Non-financial corporations 4.4% 21.7%
--------------------------------------------------------------------
Financial and insurance corporations 0.3% 4.5%
--------------------------------------------------------------------
General government 0.1% 8.4%
--------------------------------------------------------------------
Not-for-profit institutions serving households 0.2% 0.5%
--------------------------------------------------------------------
Households 94.7% 63.9%
--------------------------------------------------------------------
Rest of the world 0.4% 1.1%
--------------------------------------------------------------------
The weighted average number of shares during the reporting period, adjusted for
share issues, came to 20,760,321. The number of outstanding shares came to
20,772,523 in total at the end of the review period.
The company held a total of 103,122 treasury shares at the end of the reporting
period. The accounting counter value of these treasury shares is EUR 0.10 per
share. The company held about 0.5 per cent of the capital stock as of 30
September 2012. In relation to the company's performance-based incentive
system, Digia has financed the acquisition of 300,000 own shares. At the end of
the review period, 12,424 of these shares remained undistributed and were under
the management of Evli Alexander Management Ltd.
REPORTED SHARE PERFORMANCE ON THE HELSINKI STOCK EXCHANGE
Digia Plc shares are listed on the Nordic Exchange under ‘Information
Technology IT Services'. The company's short name is DIG1V. The lowest reported
share quotation was EUR 2.28 and the highest was EUR 3.30. The share officially
closed at EUR 2.77 on the last trading day. The trade-weighted average was EUR
2.87. The Group's market capitalisation totalled EUR 57,825,537 at the end of
the period.
The company received no flagging notifications during the reporting period.
STOCK OPTION SCHEMES
Digia Plc had no outstanding options.
Helsinki, 26 October 2012
Digia Plc
Board of Directors
BRIEFING FOR ANALYSTS
Digia will hold a briefing on its financial statement for analysts on Friday 26
October 2012, at 11 am, at WTC Sodexo, in the Marski cabinet of the World Trade
Center, Aleksanterinkatu 17, 00100 Helsinki, Finland. All are welcome.
SOURCES OF FURTHER INFORMATION
Juha Varelius, President and CEO, Mobile: +358 400 855 849, E-mail:
juha.varelius@digia.com
The Interim Report and presentation thereof will be available at the company's
website at www.digia.com in the ‘Investors' section, from 11 am.
DISTRIBUTION
NASDAQ OMX Helsinki
Key media
ABBREVIATED FINANCIAL STATEMENTS AND ATTACHMENTS
Consolidated Income Statement
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Consolidated Statement of Changes In Shareholders' Equity
Notes to the Accounts
The interim report has been prepared in compliance with IFRS and the IAS 34
standard.
This interim report is based on unaudited figures.
CONSOLIDATED INCOME STATEMENT, EUR 1,000
7-9/2012 7-9/2011 Change 1-9/2012 1-9/2011 Change, 2011
, % %
--------------------------------------------------------------------------------
NET 24,439.2 26,027.5 -6.1% 74,997.0 91,742.5 -18.3% 121,939.9
SALES
--------------------------------------------------------------------------------
Other 256.4 47.0 445.5% 710.2 99.7 612.3% 360.7
operat
ing
income
--------------------------------------------------------------------------------
Materia -1,963.1 -1,761.9 11.4% -6,692.3 -8,152.1 -17.9% -10,721.0
ls and
servic
es
--------------------------------------------------------------------------------
Depreci -1,086.8 -858.1 26.7% -2,432.3 -28,172.1 -91.4% -29,267.9
ation,
amorti
sation,
and
impair
ment
--------------------------------------------------------------------------------
Other -17,100.8 -21,381.8 -20.0% -59,942.8 -79,072.1 -24.2% -104,479.7
operat
ing
expens
es
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operati 4,544.9 2,072.7 119.3% 6,639.8 -23,554.0 -128.2% -22,168.0
ng
profit
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financi -378.9 -116.6 225.1% -1,015.7 -644.9 57.5% -963.1
al
expens
es
(net)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earning 4,166.0 1,956.2 113.0% 5,624.1 -24,198.8 -23,131.2
s
before
tax
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income -1,094.4 -810.5 35.0% -1,475.1 529.7 679.5
taxes
--------------------------------------------------------------------------------
NET 3,071.6 1,145.6 168.1% 4,149.0 -23,669.1 -22,451.6
PROFIT
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other
compre
hensive
income
:
--------------------------------------------------------------------------------
Exchang 302.7 -110.4 620.1 -111.0 42.1
e
differ
ences
on
transl
ation
of
foreig
n
operat
ions
--------------------------------------------------------------------------------
TOTAL 3,374.3 1,035.2 225.9% 4,769.1 -23,780.1 -22,409.5
COMPRE
HENSIVE
INCOME
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Distrib
ution
of net
profit
:
--------------------------------------------------------------------------------
Parent- 3,071.6 1,145.6 168.1% 4,149.0 -23,669.1 -22,451.6
company
shareh
olders
--------------------------------------------------------------------------------
Minorit 0.0 0.0 0.0 0.0 0.0
y
intere
st
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Distrib
ution
of
total
compre
hensive
income
:
--------------------------------------------------------------------------------
Parent- 3,374.3 1,035.2 225.9% 4,769.1 -23,780.1 -22,409.5
company
shareh
olders
--------------------------------------------------------------------------------
Minorit 0.0 0.0 0.0 0.0 0.0
y
intere
st
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earning 0.15 0.06 0.20 -1.14 -1.08
s per
share,
EUR
--------------------------------------------------------------------------------
Earning 0.15 0.06 0.20 -1.14 -1.08
s per
share
(dilut
ed),
EUR
--------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET, EUR 1,000
Assets 30/9/2012 31/12/2011 Change, %
---------------------------------------------------------------------
---------------------------------------------------------------------
Non-current assets
---------------------------------------------------------------------
Intangible assets 61,718.3 48,486.7 27.3%
---------------------------------------------------------------------
Tangible assets 2,166.3 3,156.5 -31.4%
---------------------------------------------------------------------
Financial assets 632.0 627.0 0.8%
---------------------------------------------------------------------
Long-term receivables 62.5 60.3 3.6%
---------------------------------------------------------------------
Deferred tax assets 1,119.0 789.9 41.7%
---------------------------------------------------------------------
---------------------------------------------------------------------
Total non-current assets 65,698.0 53,120.3 23.7%
---------------------------------------------------------------------
---------------------------------------------------------------------
Current assets
---------------------------------------------------------------------
Current receivables 21,988.7 26,523.0 -17.1%
---------------------------------------------------------------------
Available-for-sale financial assets 316.7 303.5 4.3%
---------------------------------------------------------------------
Cash and cash equivalents 8,153.9 7,866.5 3.7%
---------------------------------------------------------------------
---------------------------------------------------------------------
Total current assets 30,459.3 34,693.0 -12.2%
---------------------------------------------------------------------
---------------------------------------------------------------------
Total assets 96,157.4 87,813.3 9.5%
---------------------------------------------------------------------
Shareholders' equity and liabilities 30/9/2012 31/12/2011 Change, %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Share capital 2,087.6 2,087.6 0.0%
--------------------------------------------------------------------------------
Rights issue 0.0 0.0 ,
--------------------------------------------------------------------------------
Issue premium fund 7,899.5 7,899.5 0.0%
--------------------------------------------------------------------------------
Other reserves 5,203.8 5,203.8 0.0%
--------------------------------------------------------------------------------
Unrestricted invested shareholders' equity 33,447.8 35,525.0 -5.8%
--------------------------------------------------------------------------------
Translation difference 828.5 208.4 297.5%
--------------------------------------------------------------------------------
Retained earnings -10,843.1 11,279.9
--------------------------------------------------------------------------------
Net profit 4,149.0 -22,451.6
--------------------------------------------------------------------------------
Equity attributable to parent-company 42,773.1 39,752.6 7.6%
shareholders
--------------------------------------------------------------------------------
Minority interest 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total shareholders' equity 42,773.1 39,752.6 7.6%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Liabilities
--------------------------------------------------------------------------------
Long-term interest-bearing liabilities 15,400.7 15,441.7 -0.3%
--------------------------------------------------------------------------------
Other long-term liabilities 0.0 674.0 -100.0%
--------------------------------------------------------------------------------
Deferred tax liabilities 637.9 772.0 -17.4%
--------------------------------------------------------------------------------
Total long-term liabilities 16,038.6 16,887.7 -5.0%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Short-term interest-bearing liabilities 6,292.4 6,430.2 -2.1%
--------------------------------------------------------------------------------
Other short-term liabilities 31,053.3 24,742.8 25.5%
--------------------------------------------------------------------------------
Total short-term liabilities 37,345.7 31,173.0 19.8%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total liabilities 53,384.3 48,060.7 11.1%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Shareholders' equity and liabilities 96,157.4 87,813.3 9.5%
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT, EUR 1,000
1/1/2012-30/09/ 1/1/2011-30/9/ 1/1/2011-31/12
2012 2011 /2011
--------------------------------------------------------------------------------
Cash flow from operations:
--------------------------------------------------------------------------------
Net profit 4,149 -23,669 -22,452
--------------------------------------------------------------------------------
Adjustments to net profit 6,730 32,043 34,780
--------------------------------------------------------------------------------
Change in working capital 6,924 544 2,791
--------------------------------------------------------------------------------
Interest paid -596 -505 -781
--------------------------------------------------------------------------------
Interest income 3 27 35
--------------------------------------------------------------------------------Taxes paid 490 -5,203 -5,532
--------------------------------------------------------------------------------
Net cash flow from operations 17,700 3,237 8,842
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from investments:
--------------------------------------------------------------------------------
Purchases of tangible and -15,776 -2,373 -2,733
intangible assets
--------------------------------------------------------------------------------
Cash flow from investments -15,776 -2,373 -2,733
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from financing:
--------------------------------------------------------------------------------
Proceeds from share issue 0 0 0
--------------------------------------------------------------------------------
Acquisition of own shares 0 0 0
--------------------------------------------------------------------------------
Repayment of current loans -3,544 -2,044 -19,044
--------------------------------------------------------------------------------
Repayments of non-current loans 0 0 0
--------------------------------------------------------------------------------
Withdrawals of current loans 500 0 3,500
--------------------------------------------------------------------------------
Withdrawals of non-current 3,500 0 13,500
loans
--------------------------------------------------------------------------------
Dividends paid and other profit -2,078 -5,577 -5,577
distribution
--------------------------------------------------------------------------------
Cash flow from financing -1,623 -7,621 -7,621
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Change in liquid assets 301 -6,757 -1,512
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Liquid assets at beginning of 8,170 9,682 9,682
period
--------------------------------------------------------------------------------
Change in fair value
--------------------------------------------------------------------------------
Change in liquid assets 301 -6,757 -1,512
--------------------------------------------------------------------------------
Liquid assets at end of period 8,470 2,925 8,170
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, EUR 1,000
2011 a) b) c) d) e) f) g) h)
--------------------------------------------------------------------------------
Shareholders' equity, 2,086 40 7,899 35,486 5,204 166 16,529 67,411
1 January 2011
--------------------------------------------------------------------------------
Net profit -23,669 -23,669
--------------------------------------------------------------------------------
Other comprehensive -111 -111
income
--------------------------------------------------------------------------------
Dividends -5,577 -5,577
--------------------------------------------------------------------------------
Share-based payments 1 -40 39 273 273
recognised against
equity
--------------------------------------------------------------------------------
Shareholders' equity, 2,088 0 7,899 35,525 5,204 55 -12,444 38,327
30 September 2011
--------------------------------------------------------------------------------
2012 a) b) c) d) e) f) g) h)
--------------------------------------------------------------------------------
Shareholders' equity, 1 2,088 0 7,899 35,525 5,204 208 -11,172 39,753
January 2012
--------------------------------------------------------------------------------
Net profit 4,149 4,149
--------------------------------------------------------------------------------
Other comprehensive 620 620
income
--------------------------------------------------------------------------------
Repayment of capital -2,077 -2,077
--------------------------------------------------------------------------------
Share-based payments 329 329
recognised against
equity
--------------------------------------------------------------------------------
Shareholders' equity, 30 2,088 0 7,899 33,448 5,204 828 -6,694 42,773
September 2012
--------------------------------------------------------------------------------
a = share capital
b = rights issue
c = share premium
d = unrestricted invested shareholders' equity
e = other reserves
f = currency translation differences
g = retained earnings
h = total shareholders' equity
NOTES TO THE ACCOUNTS
Accounting principles:
The interim report has been drafted in line with IFRS. In other respects, the
same accounting principles have been applied as in the 2011 Financial
Statements. The accounting principles and formulas for the calculation of key
figures and ratios are unchanged and are presented in the 2011 Financial
Statements.
Seasonal nature of business:
The Group's business is affected by the number of workdays each month, as well
as by holiday seasons.
Dividends paid:
Dividends paid during the reporting period totalled EUR 2,077,252.30.
Related-party transactions:
Digia Group's related parties include the CEO and the members of the Board of
Directors and Group Management Team. Digia Group had no significant
transactions with related parties during the reporting period.
M&A transactions completed:
On 8 August the company made a deal to buy Qt software technology and the
related business from Nokia Plc. With the acquisition, 88 employees in Norway,
Germany and Finland were transferred to the company's employ. The deal became
effective on 18 September 2012 and the net acquisition price was EUR 4.0
million, comprising the sale price of EUR 16.2 million related to the assets
and business transferred, minus a bill of EUR 12.2 million from Digia to Nokia.
Of the sale price of EUR 16.2 million, EUR 6.6 million of goodwill pertained to
intangible rights, EUR 2.9 million to the brand, EUR 4.1 million to technology
and EUR 1.0 million to the customer relationship with Nokia. According to
Finnish Accounting Standards (FAS) the depreciation of the goodwill is
deductible in taxation. Additionally, EUR 0.2 million was recorded as an
expense and EUR 1.5 million as a loan repayment related to an expense from 2012
covered as a part of the deal.
The aforementioned bill from Digia to Nokia related to the granting to Nokia of
the right to continue using Qt in its own business, to a three-year competition
and transfer restriction applying to the technology acquired by Digia, and to
Nokia's fixed-term obligation to provide Digia with services facilitating the
takeover of the acquired business, which were valued in total at EUR 12.2
million. Of the total sum, EUR 9.2 million was related to the right of use
granted to Nokia and is considered to make up income for the company; of this,
EUR 3,8 million was allocated to the third quarter and the other EUR 5.4
million will be recognised evenly over the next three years.
Consolidated income statement by quarter:
EUR 1,000 7-9/2012 4-6/2012 1-3/2012 10-12/201 7-9/2011
1
--------------------------------------------------------------------------------
Net sales 24,439.2 24,493.4 26,064.4 30,197.3 26,027.5
--------------------------------------------------------------------------------
Other operating income 256.4 251.6 202.2 261.0 47.0
--------------------------------------------------------------------------------
Materials and services -1,963.1 -2,184.9 -2,544.3 -2,568.9 -1,761.9
--------------------------------------------------------------------------------
Depreciation, -1,086.8 -697.5 -648.0 -1,095.9 -858.1
amortisation, and
impairment
--------------------------------------------------------------------------------
Other operating expenses -17,100.8 -21,186.2 -21,655.8 -25,407.6 -21,381.8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit 4,544.9 676.4 1,418.5 1,385.9 2,072.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial expenses (net) -378.9 -289.1 -347.7 -318.3 -116.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings before tax 4,166.0 387.3 1,070.8 1,067.7 1,956.2
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Income taxes -1,094.4 -107.6 -273.1 149.8 -810.5
--------------------------------------------------------------------------------
Net profit 3,071.6 279.7 797.7 1,217.5 1,145.6
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Allocation:
--------------------------------------------------------------------------------
Parent-company 3,071.6 279.7 797.7 1,217.5 1,145.6
shareholders
--------------------------------------------------------------------------------
Minority interest 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share, EUR 0.15 0.01 0.04 0.06 0.06
--------------------------------------------------------------------------------
Earnings per share 0.15 0.01 0.04 0.06 0.06
(diluted), EUR
--------------------------------------------------------------------------------
Group key figures and ratios:
EUR 1,000 1-9/2012 1-9/2011 2011
--------------------------------------------------------------------------------
Extent of business:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net sales 74,997 91,743 121,940
--------------------------------------------------------------------------------
- change from previous year -18.3% -3.2% -6.8%
--------------------------------------------------------------------------------
Average capital invested 63,045 75,494 76,176
--------------------------------------------------------------------------------
Personnel at period end 1,044 1,388 1,175
--------------------------------------------------------------------------------
Average number of personnel 1,030 1,519 1,453
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profitability:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit before extraordinary items and 7,219 5,602 8,084
impairment
--------------------------------------------------------------------------------
- % of net sales 9.6% 6.1% 6.6%
--------------------------------------------------------------------------------
Operating profit 6,640 -23,554 -22,168
--------------------------------------------------------------------------------
- % of net sales 8.9% -25.7% -18.2%
--------------------------------------------------------------------------------
Earnings before tax 5,624 -24,199 -23,131
--------------------------------------------------------------------------------
- % of net sales 7.5% -26.4% -19.0%
--------------------------------------------------------------------------------
Net profit 4,149 -23,669 -22,452
--------------------------------------------------------------------------------
% of net sales 5.5% -25.8% -18.4%
--------------------------------------------------------------------------------
Return on equity, % 13.4% -59.7% -41.9%
--------------------------------------------------------------------------------
Return on investment, % 14.3% -41.2% -28.7%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financing and financial standing:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Interest-bearing liabilities 21,693 21,934 21,872
--------------------------------------------------------------------------------
Short-term investments, and cash and bank 8,471 2,925 8,170
receivables
--------------------------------------------------------------------------------
Net gearing 30.9% 49.6% 34.5%
--------------------------------------------------------------------------------
Equity ratio 51.6% 47.4% 47.8%
--------------------------------------------------------------------------------
Net cash flow from operations 17,700 3,237 8,842
--------------------------------------------------------------------------------
Earnings per share, undiluted (EUR) 0.20 -1.14 -1.08
--------------------------------------------------------------------------------
Earnings per share, diluted (EUR) 0.20 -1.14 -1.08
--------------------------------------------------------------------------------
Equity/share, EUR 2.05 1.84 1.90
--------------------------------------------------------------------------------
Lowest share trading price, EUR 2.28 2.30 2.30
--------------------------------------------------------------------------------
Highest share trading price, EUR 3.30 5.79 5.79
--------------------------------------------------------------------------------
Average share price, EUR 2.87 4.24 3.88
--------------------------------------------------------------------------------
Market capitalisation 57,826 53,442 50,519
--------------------------------------------------------------------------------
Formulae for key figures and ratios are presented in the 2011 financial
statements. These formulae remained unchanged during the reporting period.
© 2024 Nasdaq, Inc. All Rights Reserved |