BASWARE CORP. STOCK EXCHANGE RELEASE APRIL 17, 2007
SUMMARY
- Net sales EUR 17 038 thousand (EUR 15 432 thousand) - growth 10 percent
- Operating profit EUR 1 409 thousand (EUR 2 529 thousand) - decrease 44
percent.
Compared with the same period last year, a formal bad debt reservation of EUR
1.3 million has been realized in sales receivables. This is expected to dissolve
during the financial year and have a positive effect on profitability
- Operating profit 8.3 percent of net sales (16.4%)
- Share of international operations 45 percent of net sales (41%) - growth 23
percent
- Earnings per share EUR 0.08 (EUR 0.19)
- Outlook for 2007: BasWare expects the growth of net sales for the financial
year
to be from 15 to 20 percent compared with the Group's net sales in the previous
year. Operating profit (EBIT) is expected to be from 10 to 15 percent of net
sales.
The 2006 figures have been restated to comply with the adjusted accounting
principles regarding license sales recognition. The Financial Statements have
been prepared according to International Financial Reporting Standards (IFRS).
GROUP KEY FIGURES
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| EUR thousand | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 17 038 | 15 432 | 10.4% | 59 954 |
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| Operating profit | 1 409 | 2 529 | -44.3% | 8 078 |
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| % of net sales | 8.3% | 16.4% | | 13.5% |
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| Profit before tax | 1 459 | 2 606 | -44.0% | 8 287 |
--------------------------------------------------------------------------------
| Profit for the period | 884 | 1 994 | -55.7% | 4 986 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on equity, % | 8.0% | 26.0% | | 15.1% |
--------------------------------------------------------------------------------
| Return on investment, | 13.1% | 33.5% | | 24.7% |
| % | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 12 713 | 11 153 | 14.0% | 8 975 |
| equivalents *) | | | | |
--------------------------------------------------------------------------------
| Gearing, % | -27.5% | -25.1% | | -18.4% |
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| Equity ratio, % | 68.8% | 68.8% | | 77.5% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, | 0.08 | 0.19 | -59.7% | 0.45 |
| EUR | | | | |
--------------------------------------------------------------------------------
| Earnings per share | 0.08 | 0.19 | -59.3% | 0.44 |
| (diluted), EUR | | | | |
--------------------------------------------------------------------------------
| Equity per share, EUR | 3.83 | 3.53 | 8.5% | 3.88 |
--------------------------------------------------------------------------------
*) Includes cash, cash equivalents and financial assets at fair value through
profit or loss
BasWare's CEO Ilkka Sihvo comments in conjunction with the Interim Report:
"As a whole, BasWare succeeded fairly well in the first quarter of 2007. The
units developed mainly favorably with the growth of international operations
being 23 percent in the period. Compared with the same period last year, a
formal bad debt reservation of EUR 1.3 million has been realized in sales
receivables. As a result of more efficient debt collection of receivables, the
reserve is expected to partly dissolve during the year. This will have a
positive effect on profitability.”
“BasWare's product sales grew strongly in the financial period, by 24 percent.
45 percent of the quarter's net sales came from outside of Finland. BasWare's
partner network extended with 6 new partners in the period. A partner agreement
was signed for example with Kofax in the United States. A new significant
application, BasWare Mobile Client, was launched during the period. It is the
first application in the market for invoice and purchase requisition approval
with a mobile device. BasWare has applied for a patent for the innovation.”
REPORTING
BasWare Group has adjusted the revenue recognition principles regarding license
sales as well as the valuation principles regarding accounts receivables. The
company has published the restated figures for 2005 and 2006 on February 1,
2007. The audited Financial Statements prepared according to the adjusted
accounting principles were published on February 8, 2007. BasWare assesses that
the adjusted accounting principles have no effect on the Group's financial
performance in the future.
Compared with the same period last year, a formal bad debt reservation of EUR
1.3 million has been realized in sales receivables. This is expected to dissolve
during the financial year and have a positive effect on profitability.
NET SALES
BasWare Group's net sales grew during the first quarter of the year by 10
percent and were EUR 17 038 thousand (EUR 15 432 thousand).
The Company's product sales grew by 24 percent in the period and were 39 percent
(35%) of net sales. Maintenance revenue grew by 11 percent and represented 29
percent (29%) of net sales. Consulting and services revenue decreased by 3
percent and represented 32 percent (36%) of net sales.
Value added resellers provided a net share of 17 percent (23%) or EUR 1 114
thousand of product sales in January-March. In BasWare's international
operations, value added resellers' net share of the product sales was 14 percent
(20%).
The international share of BasWare's net sales was 45 percent (41%) in the
period. International operations grew by 23 percent (85%).
The geographical division of net sales by the location of assets (primary
segment):
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| Net sales (EUR | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| thousand) | | | | |
--------------------------------------------------------------------------------
| Finland | 12 057 | 11 003 | 9.6 | 41 028 |
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| Scandinavia | 4 030 | 3 279 | 22.9 | 14 698 |
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| Europe | 2 799 | 2 284 | 22.6 | 8 985 |
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| Other | 752 | 573 | 31.2 | 3 512 |
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| Sales between segments | -2 600 | -1 705 | | -8 269 |
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| Group total | 17 038 | 15 432 | 10.4 | 59 954 |
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The geographical division of net sales by the location of customers:
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| Net sales (EUR | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| thousand) | | | | |
--------------------------------------------------------------------------------
| Finland | 9 360 | 9 175 | 2.0 | 32 557 |
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| Scandinavia | 3 929 | 3 201 | 22.7 | 14 129 |
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| Europe | 2 831 | 2 561 | 10.6 | 9 421 |
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| Other areas | 918 | 496 | 85.1 | 3 848 |
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| Group total | 17 038 | 15 433 | 10.4 | 59 954 |
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FINANCIAL PERFORMANCE
BasWare's operating profit decreased in the first quarter by 44 percent and
totaled EUR 1 409 thousand (EUR 2 529 thousand). Compared with the same period
last year, a formal bad debt reservation of EUR 1.3 million has been realized in
sales receivables. Operating profit represented 8 percent (16%) of net sales.
The division of operating profit geographically by the location of assets
(primary segment):
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| Operating profit (EUR | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| thousand) | | | | |
--------------------------------------------------------------------------------
| Finland | 3 315 | 3 487 | -4.9 | 12 314 |
--------------------------------------------------------------------------------
| Scandinavia | -229 | -159 | -43.8 | -45 |
--------------------------------------------------------------------------------
| Europe | -1 179 | -494 | -138.6 | -2 831 |
--------------------------------------------------------------------------------
| Other areas | -482 | -289 | -66.9 | -1 297 |
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| Operating profit | -15 | -16 | 6.3 | -62 |
| between segments | | | | |
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| Group total | 1 409 | 2 529 | -44.3 | 8 078 |
--------------------------------------------------------------------------------
The Company's fixed costs were EUR 14 253 thousand (EUR 11 713 thousand) and
have grown by 22 percent compared with the same period last year and by 5
percent compared with the previous quarter. Fixed costs include the bad debt
reservation of EUR 1.3 million realized in sales receivables.
The research and development costs were EUR 3 091 thousand (EUR 2 639 thousand)
of which EUR 440 thousand (EUR 572 thousand) or 14 percent (22%) were
capitalized during the financial period. Amortization of capitalized research
and development costs totaled EUR 208 thousand (EUR 80 thousand).
The Company's finance income and finance expenses were EUR 50 thousand. The
Company's profit before tax was EUR 1 459 thousand (EUR 2 606 thousand) and
profit for the period was EUR 884 thousand (EUR 1 994 thousand). Undiluted
earnings per share were EUR 0.08 (EUR 0.19).
FINANCE AND INVESTMENTS
BasWare Group's total assets on the balance sheet at the end of the financial
period were EUR 63 679 thousand (EUR 58 237 thousand). The Company's cash and
liquid assets were EUR 12 713 thousand (EUR 11 153 thousand), of which cash and
cash equivalents were EUR 5 898 thousand (EUR 5 318 thousand) and financial
assets at fair value through profit or loss were EUR 6 815 thousand (EUR 5 835
thousand).
Equity ratio was 68.8 percent (68.8%) and gearing was -27.5% (-25.1%). The
Company had a total of EUR 658 thousand (EUR 1 113 thousand) interest-bearing
liabilities, of which current liabilities accounted for EUR 426 thousand (EUR
459 thousand). Return on investment was 13.1 percent and return on equity 8.0
percent in the quarter.
Cash flows from operating activities were EUR 6 054 thousand (EUR 6 294
thousand) in the period. Cash flows from investments were EUR -753 thousand (EUR
-3 984 thousand).
The Company's capital expenditure, resulting from regular, additional and
replacement, investments resulting from growth, was EUR 169 thousand (EUR 158
thousand). Gross investments which include, in addition to the previously
mentioned, the capitalized research and development costs totaled EUR 767
thousand (EUR 21 695 thousand, includes the acquisition of Analyste).
Amortizations of intangible assets were EUR 232 thousand (EUR 325 thousand).
There are no indications of impairments of assets.
RESEARCH, DEVELOPMENT AND NEW PRODUCTS
BasWare's research and development costs were EUR 3 091 thousand (EUR 2 639
thousand) in the financial period and made up 18 percent (17%) of net sales.
Research and development costs grew by 17 percent (100%) compared with the same
period last year.
Research and development is centralized in the Software Production business
unit. Altogether 136 people (141) worked in the unit at the end of March 2007.
BasWare's entire product portfolio was further developed in the first quarter.
During the quarter, new versions of BasWare Travel & Expense Management and
BasWare Contract Matching as well as of the BasWare eOffice, BasWare Banking,
BasWare iBanking, BasWare Finance and BasWare Cashier Desk were launched.
Additionally, the BasWare anyERP Adapter and BasWare Gateway were upgraded to a
new version during the quarter.
During the quarter, BasWare Invoice Processing and BasWare Purchase Management
solutions were developed to support the Unicode encoding system. This enables
extending the sales of BasWare Enterprise Purchase to Pay solutions to the Asian
market as well as to Russia. BasWare Mobile Client and BasWare Portal
applications were also developed during the quarter. Procurement solutions,
including BasWare Purchase Management and BasWare Contract Lifecycle Management
and BasWare RFx Management, both to be launched later in the year, were
developed strongly in the quarter.
Of the Financial Management products, new versions of BasWare Group
Consolidation and the related BasWare IFRS Package were launched. New versions
of BasWare Cash Flow, BasWare Business Planning and BasWare Transparent
Reporting solutions were also launched during the period.
PERSONNEL
BasWare employed 532 (511) people in average and 533 (513) people at the end of
the period. The number of personnel grew by 4 percent compared with the first
quarter of 2006 and by one percent compared with the previous quarter.
The share of personnel working in foreign units grew slightly compared with the
same period in 2006. 34 percent (31%) of personnel work outside of Finland and
66 percent (69%) in Finland.
The average age of the employees is 35.4 (34.8) years. 34 percent of them hold a
Master's degree and 41 percent a Bachelor's degree. 29 percent of personnel are
women and 71 percent men.
For incentive purposes, the Company has a bonus program that covers the whole
personnel. Additionally, a warrant program directed to the key personnel of the
company was in effect during the period as well as a long-term share-based
incentive program for the top management.
Geographical distribution of personnel:
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| Personnel | 1-3/2007 | 1-3/ 2006 | Change, % | 1-12/ 2006 |
| (employed, in | | | | |
| average) | | | | |
--------------------------------------------------------------------------------
| Finland | 353 | 353 | 0 | 346 |
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| Scandinavia | 93 | 87 | 6.9 | 89 |
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| Europe | 65 | 57 | 14.1 | 62 |
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| Other areas | 22 | 14 | 57.1 | 17 |
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| Group total | 532 | 511 | 4.1 | 513 |
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BUSINESS OPERATIONS
General economic situation in the main market areas of BasWare remains
relatively good. Research institutions predict that the annual growth of the IT
market will be approximately 5-7 percent in the Nordic countries, Western Europe
and United States. The competitiveness of the BasWare software is estimated to
have slightly improved.
BasWare Enterprise Purchase to Pay operations grew by 9 percent in the first
quarter and represents 87 percent (88%) of total net sales. The Company
estimates that the demand for procurement solutions continues to increase. The
demand for automated invoice processing solutions and travel and expense
management solutions has remained steady.
In Enterprise Purchase to Pay units, new customers include Sato Oyj, YH Suomi
Oy, BNP Paribas SA, Continental AG, C. Steinweg Handelsveem and Peverel OM Ltd.
The Financial Management operations grew by 20 percent in the period and
represented 13 percent (12%) of net sales. The demand for Financial Management
software has been moderate especially for the planning and analyzing solutions.
The unit's new customers include Incap Oyj and Lemminkäinen Oyj.
Reseller Channel and Partners
Reseller operations through business partners are an important part of
international operations. The focus of partner operations in the first quarter
was on signing new customer agreements, recruiting new partners and on the
development of partner marketing. BasWare has initiated the development of the
indirect channel in Russia and Asia.
The partner operations organization was re-organized during the first quarter.
This was done in order to make the execution of global sales and partner
programs more efficient in the country units.
During the first quarter, 6 new reseller agreements were signed with Arcplace
AG, Kartula, Scantech, Yanistra in Europe, SpectrumIT in South Africa and Kofax
in the United States. Cooperation was terminated with one partner in the United
States.
In Central Europe and in the United States, BasWare takes part in the Microsoft
Open Borders program. The aim is to increase the awareness of BasWare and to
recruit new, suitable resellers. BasWare has also been accepted to the Forum
Nokia PRO Enterprise Zone program, directed at solution developers.
In total, BasWare had 59 international resellers in the end of the quarter,
operating in 31 countries. Outside of the Nordic countries, BasWare has 37
partners in Europe. BasWare also has a vast reseller network in Finland.
A net share of 14 percent (20%) of international product sales has been achieved
through the partner network.
Nordic
BasWare's Nordic organization includes the Enterprise Purchase to Pay and
Financial Management units in Finland, as part of the parent company, as well as
the Scandinavian (Sweden, Denmark and Norway) unit. All the BasWare Enterprise
Purchase to Pay and Financial Management products are sold in the Nordic
countries, apart from the payment solutions which are currently sold only in
Finland.
Sales and other business operations are mainly handled by the own organization.
There are altogether 28 resellers and 17 application service providers selling
payment solutions in Finland. There are two Enterprise Purchase to Pay business
partners in Sweden and one Enterprise Purchase to Pay partner in Iceland.
As a whole, BasWare's Nordic operations achieved its objectives for the quarter
and the Scandinavian unit exceeded its objective. The Financial Management unit
fell slightly behind its objective.
BasWare eInvoices Oy signed 68 new customer agreements during the quarter with
mainly foreign customers. A total of 1.5 million invoices were transmitted
through the eInvoicing service in the first quarter and the invoice volume grew
by 45 percent compared with the same period last year.
Europe
Outside of Scandinavia, BasWare has European subsidiaries in the Netherlands,
Germany, the United Kingdom and France. There are a total of 37 resellers in the
area selling BasWare's products. Additionally, BasWare has three partners in
Southern Europe. All BasWare Enterprise Purchase to Pay products are sold in the
area.
As a whole, the European business area fell slightly behind its objective but
developed favorably. The Dutch subsidiary achieved its objective for the period.
The operations of subsidiaries in United Kingdom, Germany and France developed
favorably but fell slightly behind the objective.
Other Areas
Outside of Europe, BasWare has a U.S. subsidiary which focuses on the sales of
the Enterprise Purchase to Pay solutions in the United States and Canada. In
addition, there are 8 resellers in the area, one of which started partner
operations during the quarter.
The net sales of BasWare, Inc. fell behind the objective for the quarter. The
volume of orders in the area has however developed favorably and part of the
agreements will be entered as income during the second quarter.
The sales in other areas outside Europe, mainly in Australia, are handled
through value added resellers. Their net sales, that are entered as a part of
the Finnish parent company's sales in segment reporting, fell behind the
objective for the period.
ANNUAL GENERAL MEETING OF SHAREHOLDERS AND GOVERNANCE
The Annual General Meeting (AGM) of BasWare Corporation on February 26, 2007
adopted the Financial Statements for 2006 and discharged the members of the
Board and CEO from liability for the financial year. As proposed by the Board,
the AGM resolved to distribute a dividend of EUR 0.15 per share for 2006, a
total of EUR 1 720 218.60 with the number of shares on the date of the AGM.
Asko Ahonen, Tom Bangemann, Kirsi Eräkangas, Ossi Pohjola, Antti Pöllänen and
Hannu Vaajoensuu continue as members of the Board of Directors. In its first
meeting, the Board elected Hannu Vaajoensuu to continue as Chairman and Kirsi
Eräkangas to continue as Vice Chairman. In addition, the Board resolved that
separate committees were not to be formed since the extent of the Company's
business and the size of the Board do not require preparation of matters in a
smaller group of directors than the Board.
Deloitte & Touche Oy, Authorized Public Accountants, with APA Mikael Paul in
charge was elected as the auditor. APA Teppo Rantanen acts as the deputy
auditor.
The Company applies the Guidelines for Insiders issued by the Board of Directors
of the Helsinki Stock Exchange as well as the Recommendation on Corporate
Governance with the exceptions mentioned in the Company's Corporate Governance
Statement. The statement can be found in the Investors section of the Company's
website.
SHARE AND SHAREHOLDERS
BasWare Corporation's share capital totaled EUR 3 440 437.20 at the end of the
period and the number of shares was 11 468 124. The book counter value of the
shares is EUR 0.30 per share.
Board's Authorizations
Authorization to resolve on share issue
The Annual General Meeting authorized the Board to resolve on the issuance of a
maximum of
2 293 624 shares and on the conveying of a maximum of 1 146 812 shares in
possession of the Company in one or more installments, either against pay or
free of charge.
The new shares can be issued and the Company's own shares conveyed either
against payment or for free to the Company's shareholders in proportion to their
holding or by means of a directed issue, deviating from the pre-emptive rights
of the shareholders provided that from the Company's perspective there are
important financial grounds for it, such as enabling business arrangements and
company acquisitions, company's capital management, personnel incentive program
or other reasons for developing the Company's business activities.
The authorization also includes the right to grant warrants and other special
rights to receive new shares in the company or BasWare shares held by the
company against payment such that either the share subscription price will be
paid in cash or the subscriber's receivables will be offset against the
subscription price.
The authorization also includes the right to resolve on a free issue to the
Company itself. The amount of the shares issued to the Company can be a maximum
of 1 146 812 shares, including shares acquired based on the authorization or the
previously acquired own shares of the Company.
The subscription prices of new shares and the sum paid for the own shares will
be recorded in the fund for invested non-restricted equity.
The authorization is valid until March 31, 2008.
Authorization to resolve on acquiring the Company's own shares
The Board is authorized to resolve on the acquisition of a maximum of 1 146 812
own shares. The new shares are acquired at the Helsinki Stock Exchange and can
either be held by the Company, nullified or conveyed further. The authorization
for acquisition is valid until March 31, 2008.
Authorization to resolve on an extraordinary dividend distribution
The Board is authorized to resolve on an extraordinary dividend distribution
totaling a maximum of EUR 1 000 000, distributed from the Company's
distributable funds.
The authorization is in effect until the start of the following Annual General
Meeting.
Warrant Programs
Warrant Program 2006
Based on the Warrant Program 2006, a maximum of 300 000 warrants can be granted
to the key personnel of BasWare Group, each warrant entitling to subscribe one
BasWare share. The warrants of the Warrant Program 2006 are divided into three
series, each having an own subscription period as follows: April 1, 2008-March,
31 2009, April 1, 2009-March 31, 2010 and April 1, 2010-March 31, 2011. The
subscription prices of the shares correspond to the volume-weighted average
share price of the Company in January-March of 2006, 2007 and 2008.
Warrant Program 2007
The warrants shall, by deviation from the shareholders' pre-emptive right to
subscription, be issued to key personnel identified by the Board of Directors,
employed by the group for the present and not part-time, to increase their
commitment and work motivation. Part of the warrants shall be issued to the
wholly owned subsidiary of BasWare Corporation to be issued later to persons
employed by the Group or to persons who are recruited to the Group.
The shareholders' pre-emptive right to subscription is being deviated from,
since the warrants are intended to form a part of the Group's incentive program
and, thus, from the Company's perspective, there are considerable financial
grounds for it.
The warrants are granted free of charge. The Board of Directors shall decide
upon the procedure and schedule of the approval of warrants. The warrants will
be granted to the Group's personnel and management according to the resolution
of the Board.
BasWare Corporation shall issue a maximum of 200 000 warrants, whereof 100 000
shall be marked with the letter D and 100 000 with the letter E. The warrants
will be issued in the book-entry system. Each warrant entitles its holder to
subscribe one (1) share in BasWare Corporation.
The subscription price of the share will be recorded to EUR 0.30 in the share
capital of Company and for the remainder in the fund for invested non-restricted
equity. BasWare's share capital can increase by a maximum of 200.000 new shares
or EUR 60 000 based on the subscriptions.
The subscription period is
- warrant D April 1, 2009 - March 31, 2010,
- warrant E April 1, 2010 - March 31, 2011
The subscription prices correspond to
- for warrant D, the volume-weighted average share price of the Company in
January-March of 2007
- for warrant E, the volume-weighted average share price of the Company in
January-March of 2008
The portion of shares subscribed based on the now issued warrants totals a
maximum of 1.71% of the Company's shares and votes after the possible increase
in share capital.
Share price and trade
In the first quarter, the highest price of the share was EUR 14.00 (EUR 14.40),
lowest price was EUR 10.48 (EUR 11.85) and closing price was EUR 11.30 (EUR
13.55). The average price of the share was EUR 12.19 (EUR 13.35).
A total of 1 114 729 (2 554 816) shares were traded during the financial period
which is the equivalent of 10 percent (24%) of the average number of shares.
Market capitalization with the period's closing price on March 31, 2007 was EUR
129 589 801 (EUR 153 667 488).
Shareholders
BasWare had 18 951 (21 058) shareholders at the end of the financial period,
including nominee-registered holdings (9). Nominee-registered holdings accounted
for 13.5 percent of the total number of shares. The Company received no notices
of change in ownership during the financial period.
EVENTS AFTER THE FINANCIAL PERIOD
The Board of Directors, in its meeting on April 13, 2007, supplemented the
conditions of the 2007 option program as follows:
The Company has the right, before a stock subscription, to acquire warrants for
the Company from the holders of the warrants. Acquiring the rights enacted in
chapter 10 of the Companies Act and other rights does not cause changes to the
conditions for warrants.
The board of directors has the right to decide whether the subscription price of
a share to be subscribed with warrants should be lowered after the start of the
determination period and before the share subscription by an amount that (i) has
been distributed to shareholders as a special dividend, deviating from the usual
distribution of dividends, (ii) has been distributed to shareholders as a
distribution of other free capital on the basis of share ownership, (iii) has
been distributed to share holders on the basis of acquisition of the Company's
own shares at a price above the current price, or (iv) has been distributed to
shareholders on the basis of share ownership in consequence of a reduction of
share capital, the share premium account, the reserve fund, or something
similar. Other fund-distribution situations do not cause changes in the
conditions for warrants.
If the Company is removed from the register before share subscription, an owner
of a warrant has the same or equivalent right as a shareholder.
FUTURE OUTLOOK
According to research institutions, the global enterprise software market will
grow by approximately 5-7 percent annually. However, regional growth may
outstrip this; for example in Asia Pacific annual growth is estimated at over 12
percent. BasWare operates in the electronic procurement and purchase invoice
area, which is expected to grow more rapidly than the average for enterprise
software.
Western Europe and the United States represent approximately three quarters of
overall demand for enterprise software. Since invoice processing and purchase
management software remain at the beginning of their lifecycles in these
regions, demand is estimated to be high.
The purchase management and invoice processing software markets are relatively
heterogeneous with regards to the competitive situation. However, strong growth
may attract more competitors to the market. The industry is consolidating
rapidly and this development is expected to continue in the future. BasWare is a
medium sized software company on a global scale, in terms of sales and number of
personnel.
BasWare's direct competitors are mainly smaller companies that operate locally.
Document management, scanning and workflow solution developers compete with
BasWare especially in invoice processing. Competing solutions also include
tailored software solutions that complement Enterprise Resource Planning (ERP)
systems and require extensive client-specific project work.
The competitiveness of the software is still good due to new value added
products and the integrated concept that the products form. A leading research
company names the leading provider of invoice automation solutions. In
procurement, BasWare is estimated to be one of the top five vendors in the
world.
The Company's international growth is based on the Company's own sales and
marketing efforts as well as on reseller operations. The development of the
indirect channel continues especially in Europe and North America, in Russia and
in Asia. In Scandinavia, the focus is on profitability, supported by the
extending product portfolio. In Finland, the focus is on profitability and the
moderate growth is enabled by the success in the purchase management area.
BasWare has complemented its organic growth with acquisitions. The Company
continues to review possible acquisition targets during 2007. With the
acquisitions, the Company can extend the sales channel and the product
portfolio. They may also strengthen the Company's position in the electronic
invoicing market.
In 2007, BasWare expects the growth of net sales for the financial year to be
from 15 to 20 percent compared with the Group's net sales in the previous year.
Operating profit (EBIT) is expected to be from 10 to 15 percent of net sales.
In Espoo, Finland, April 17, 2007
BASWARE CORPORATION
Board of Directors
For more information, please contact
CEO Ilkka Sihvo, BasWare Corp.,
Tel. +358 9 8791 7251 or +358 40 501 8251
Analyst and Press Briefing
BasWare arranges today, April 17, 2007 a briefing on the Interim Report for the
press and analysts at 10:30 in Hotel Kämp, Paavo Nurmi conference room in
Helsinki, Finland. During this briefing CEO Ilkka Sihvo will comment the
operations and financial performance of the quarter. Welcome.
Distribution
Helsinki Stock Exchange
Key media
www.basware.com
GROUP INCOME STATEMENT
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| EUR thousand | 1.1.-31.3. | 1.1.-31.3. | Change, % | 1.1.-31.12. |
| | 2007 | 2006 | | 2006 |
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| | | | | |
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| NET SALES | 17 038 | 15 432 | 10.4 | 59 954 |
--------------------------------------------------------------------------------
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| Other operating income | 15 | 41 | -62.5 | 177 |
--------------------------------------------------------------------------------
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| Materials and services | -819 | -778 | 5.3 | -2 593 |
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| Employee benefits | -9 243 | -8 259 | 11.9 | -32 953 |
| expenses | | | | |
--------------------------------------------------------------------------------
| Depreciation and | -571 | -453 | 26.1 | -2 033 |
| amortization | | | | |
--------------------------------------------------------------------------------
| Other operating | -5 010 | -3 454 | 45.1 | -14 474 |
| expenses | | | | |
--------------------------------------------------------------------------------
| Operating profit | 1 409 | 2 529 | -44.3 | 8 078 |
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| Finance Income and | 50 | 78 | -35.9 | 209 |
| Expenses | | | | |
--------------------------------------------------------------------------------
| Profit before tax | 1 459 | 2 606 | -44.0 | 8 287 |
--------------------------------------------------------------------------------
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| Income tax expense | -575 | -613 | -6.1 | -3 301 |
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| PROFIT FOR THE PERIOD | 884 | 1 994 | -55.7 | 4 986 |
--------------------------------------------------------------------------------
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| EPS (undiluted), EUR | 0.08 | 0.19 | -59.3 | 0.45 |
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| EPS (diluted), EUR | 0.08 | 0.19 | -59.0 | 0.44 |
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| Average share number: | | | | |
--------------------------------------------------------------------------------
| - undiluted | 11 468 124 | 10 432 080 | 9.9% | 11 172 612 |
--------------------------------------------------------------------------------
| - diluted | 11 468 124 | 10 529 954 | 8.9% | 11 221 052 |
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GROUP BALANCE SHEET
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| EUR thousand | 31.3.2007 | 31.3.2006 | Change, % | 31.12.2006 |
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| | | | | |
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| ASSETS | | | | |
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| NON-CURRENT ASSETS | | | | |
--------------------------------------------------------------------------------
| Intangible assets | 10 150 | 9 103 | 11.5 | 9 980 |
--------------------------------------------------------------------------------
| Goodwill | 18 489 | 17 763 | 4.1 | 18 477 |
--------------------------------------------------------------------------------
| Tangible assets | 821 | 1 013 | -19.0 | 784 |
--------------------------------------------------------------------------------
| Investments in associates | | 3 | -100.0 | |
--------------------------------------------------------------------------------
| Available-for-sale | 2 612 | 2 606 | 0.2 | 2 612 |
| investments | | | | |
--------------------------------------------------------------------------------
| Trade and other | 12 | 12 | -0.5 | |
| receivables | | | | |
--------------------------------------------------------------------------------
| Deferred tax assets | 3 102 | 4 056 | -23.5 | 3 501 |
--------------------------------------------------------------------------------
| Non-current assets | 35 188 | 34 557 | 1.8 | 35 354 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT ASSETS | | | | |
--------------------------------------------------------------------------------
| Inventories | 18 | 21 | -11.6 | 20 |
--------------------------------------------------------------------------------
| Trade and other | 15 547 | 12 434 | 25.0 | 13 018 |
| receivables | | | | |
--------------------------------------------------------------------------------
| Income tax receivables | 213 | 72 | 196.3 | 192 |
--------------------------------------------------------------------------------
| Financial assets at fair | 6 815 | 5 835 | 16.8 | 5 963 |
| value through profit or | | | | |
| loss | | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 5 898 | 5 318 | 10.9 | 3 012 |
--------------------------------------------------------------------------------
| Current assets | 28 491 | 23 680 | 20.3 | 22 204 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL ASSETS | 63 679 | 58 237 | 9.3 | 57 558 |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY AND LIABILITIES | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY | | | | |
--------------------------------------------------------------------------------
| Share capital | 3 440 | 3 402 | 1.1 | 3 440 |
--------------------------------------------------------------------------------
| Share premium account | 33 127 | 32 213 | 2.8 | 33 127 |
--------------------------------------------------------------------------------
| Fair value reserve and | 540 | | | 540 |
| other reserves | | | | |
--------------------------------------------------------------------------------
| Translation differences | 283 | 163 | 73.5 | 235 |
--------------------------------------------------------------------------------
| Retained earnings | 6 370 | 4 282 | 53.6 | 7 176 |
--------------------------------------------------------------------------------
| Minority interest | 81 | | | 88 |
--------------------------------------------------------------------------------
| Shareholders' equity | 43 841 | 40 061 | 10.0 | 44 606 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NON-CURRENT LIABILITIES | | | | |
--------------------------------------------------------------------------------
| Deferred tax liability | 1 437 | 1 541 | -6.8 | 1 462 |
--------------------------------------------------------------------------------
| Interest-bearing | 232 | 653 | -64.5 | 329 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Non-current liabilities | 1 669 | 2 195 | -24.0 | 1 791 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CURRENT LIABILITIES | | | | |
--------------------------------------------------------------------------------
| Interest-bearing | 426 | 459 | -7.3 | 428 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Trade payables and other | 17 324 | 14 575 | 17.4 | 9 957 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Tax liability from income | 419 | 947 | -55.7 | 775 |
| tax | | | | |
--------------------------------------------------------------------------------
| Current liabilities | 18 169 | 15 982 | 12.4 | 11 160 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| TOTAL EQUITY AND | 63 679 | 58 237 | 9.3 | 57 558 |
| LIABILITIES | | | | |
--------------------------------------------------------------------------------
GROUP STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
--------------------------------------------------------------------------------
| EUR thousand | Share- | Share | Other | Transl | Retai | Minori | Share- |
| | holder | premiu | reser | ation | ned | ty | holder |
| | s' | m | ves | differ | earni | intere | s' |
| | equity | accoun | | ences | ngs | st | equity |
| | | t | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 2 963 | 15 010 | | -203 | 3 527 | | 21 296 |
| EQUITY 1.1.2006 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in | | | | 366 | -263 | | 103 |
| translation | | | | | | | |
| difference | | | | | | | |
--------------------------------------------------------------------------------
| Granted | | | | | 95 | | 95 |
| warrants | | | | | | | |
--------------------------------------------------------------------------------
| Net profit/loss | | | | 366 | -168 | | 198 |
| recognized | | | | | | | |
| directly in | | | | | | | |
| shareholders' | | | | | | | |
| equity | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the | | | | | 1 994 | | 1 994 |
| period | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total profits | | | | 366 | 1 825 | | 2 191 |
| and losses | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Dividend | | | | | -1 | | -1 070 |
| distribution | | | | | 070 | | |
--------------------------------------------------------------------------------
| Rights issue | 439 | | | | | | 439 |
--------------------------------------------------------------------------------
| Share premium | | 17 211 | | | | | 17 211 |
--------------------------------------------------------------------------------
| Transaction | | -8 | | | | | -8 |
| costs for | | | | | | | |
| equity | | | | | | | |
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 3 402 | 32 213 | | 163 | 4 282 | | 40 061 |
| EQUITY | | | | | | | |
| 31.3.2006 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR thousand | Share- | Share | Other | Transl | Retai | Minori | Share- |
| | holder | premiu | reser | ation | ned | ty | holder |
| | s' | m | ves | differ | earni | intere | s' |
| | equity | accoun | | ences | ngs | st | equity |
| | | t | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 3 440 | 33 127 | 540 | 235 | 7 176 | 88 | 44 606 |
| EQUITY 1.1.2007 | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in | | | | 48 | | | 48 |
| translation | | | | | | | |
| difference | | | | | | | |
--------------------------------------------------------------------------------
| Granted | | | | | 22 | | 22 |
| warrants | | | | | | | |
--------------------------------------------------------------------------------
| Other changes | | | | | 1 | | 1 |
--------------------------------------------------------------------------------
| Net profit/loss | | | | 48 | 23 | | 71 |
| recognized | | | | | | | |
| directly in | | | | | | | |
| shareholders' | | | | | | | |
| equity | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the | | | | | 891 | -7 | 884 |
| period | | | | | | | |
--------------------------------------------------------------------------------
| Total profits | | | | 48 | 914 | -7 | 955 |
| and losses | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Dividend | | | | | -1 | | -1 720 |
| distribution | | | | | 720 | | |
--------------------------------------------------------------------------------
| SHAREHOLDERS' | 3 440 | 33 127 | 540 | 283 | 6 370 | 81 | 43 841 |
| EQUITY | | | | | | | |
| 31.3.2007 | | | | | | | |
--------------------------------------------------------------------------------
GROUP CASH FLOW STATEMENT
--------------------------------------------------------------------------------
| EUR thousand | 1.1.-31.3.2 | 1.1.-31.3.2 | 1.1.-31.12.2 |
| | 007 | 006 | 006 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flows from operating | | | |
| activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit for the period | 884 | 1994 | 4 986 |
--------------------------------------------------------------------------------
| Adjustments for profit | 1 118 | 775 | 5 235 |
--------------------------------------------------------------------------------
| Working capital changes | 4 658 | 4 107 | -902 |
--------------------------------------------------------------------------------
| Interest paid | -7 | -13 | -41 |
--------------------------------------------------------------------------------
| Interest received | 8 | 28 | 70 |
--------------------------------------------------------------------------------
| Other financial items in | -1 | 44 | 57 |
| operating activities | | | |
--------------------------------------------------------------------------------
| Income taxes paid | -607 | -640 | -3 750 |
--------------------------------------------------------------------------------
| Net cash from operating | 6 054 | 6 294 | 5 657 |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flows from investing | | | |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Purchase of tangible and | -757 | -811 | -3 021 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Proceeds from sale of tangible | 1 | 35 | 64 |
| and intangible assets | | | |
--------------------------------------------------------------------------------
| Acquired subsidiaries | | -3 660 | -3 660 |
--------------------------------------------------------------------------------
| Disposal of associated companies | | | 23 |
--------------------------------------------------------------------------------
| Proceeds from other investments | | 452 | 457 |
--------------------------------------------------------------------------------
| Granted loans | | | -1 |
--------------------------------------------------------------------------------
| Repayments of loan receivables | 3 | | 24 |
--------------------------------------------------------------------------------
| Net cash used in investing | -753 | -3 984 | -6 114 |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flows from financing | | | |
| activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Proceeds from issuance of share | | 41 | 760 |
| capital | | | |
--------------------------------------------------------------------------------
| Repayments of long-term | -100 | -100 | -400 |
| borrowings | | | |
--------------------------------------------------------------------------------
| Repayments of financial lease | -7 | -18 | -75 |
| liabilities | | | |
--------------------------------------------------------------------------------
| Dividends paid | -1 510 | -1 070 | -1 070 |
--------------------------------------------------------------------------------
| Net cash used in financing | - 1 617 | -1 146 | -689 |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Net change in cash and cash | 3 683 | 1 164 | -1 146 |
| equivalents according to cash | | | |
| flow statement | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and cash equivalents at | 8 975 | 9 987 | 9 987 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Effects of exchange rate changes | 3 | 2 | -19 |
| on cash | | | |
| and cash equivalents | | | |
--------------------------------------------------------------------------------
| Effects of fair value | 52 | | 152 |
| implementation | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at end | 12 713 | 11 153 | 8 975 |
| of period | | | |
--------------------------------------------------------------------------------
GROUP QUARTERLY INCOME STATEMENT
--------------------------------------------------------------------------------
| EUR thousand | 1-3/2007 | 1-3/2006 | 4-6/2006 | 7-9/2006 | 10-12/200 |
| | | | | | 6 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| NET SALES | 17 038 | 15 432 | 14 651 | 13 363 | 16 508 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other operating | 15 | 41 | 61 | 25 | 50 |
| income | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Materials and | -819 | -778 | -689 | -468 | -658 |
| services | | | | | |
--------------------------------------------------------------------------------
| Employee benefits | -9 243 | -8 259 | -8 710 | -6 942 | -9 042 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Depreciation and | -571 | -453 | -488 | -520 | -572 |
| amortization | | | | | |
--------------------------------------------------------------------------------
| Other operating | -5 010 | -3 454 | -3 578 | -2 963 | -4 479 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 1 409 | 2 529 | 1 247 | 2 495 | 1 807 |
--------------------------------------------------------------------------------
| % | 8.3% | 16.4% | 8.5% | 18.7% | 10.9% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Finance income and | 50 | 78 | 40 | 68 | 23 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| Profit before tax | 1 459 | 2 606 | 1 287 | 2 563 | 1 831 |
--------------------------------------------------------------------------------
| % | 8.6% | 16.9% | 8.8% | 19.2% | 11.1% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Tax on income from | -575 | -613 | -486 | -898 | -1 304 |
| operations | | | | | |
--------------------------------------------------------------------------------
| PROFIT FOR THE | 884 | 1 994 | 801 | 1 665 | 526 |
| PERIOD | | | | | |
--------------------------------------------------------------------------------
| % | 5.2% | 12.9% | 5.5% | 12.5% | 3.2% |
--------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENT LIABILITIES
--------------------------------------------------------------------------------
| EUR thousand | 31.3.2007 | 31.3.2006 | 31.12.200 |
| | | | 6 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Guarantees on behalf of subsidiaries, | 986 | 740 | 986 |
| total | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Own contingent liabilities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Lease liabilities | | | |
--------------------------------------------------------------------------------
| Current lease liabilities | 554 | 524 | 544 |
--------------------------------------------------------------------------------
| Lease liabilities maturing in 1-5 years | 485 | 496 | 567 |
--------------------------------------------------------------------------------
| Total | 1 039 | 1 021 | 1 111 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Rental liabilities | | | |
--------------------------------------------------------------------------------
| Current rental liabilities | 1 414 | 1 273 | 1 334 |
--------------------------------------------------------------------------------
| Rental liabilities maturing in 1-5 years | 2 763 | 1 405 | 3 193 |
--------------------------------------------------------------------------------
| Total | 4 176 | 2 678 | 4 527 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Own contingent liabilities, total | 5 215 | 3 698 | 5 638 |
--------------------------------------------------------------------------------
SEGMENT REPORTING
Geographical segments (primary segment)
--------------------------------------------------------------------------------
| Net sales | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| (EUR thousand) | | | | |
--------------------------------------------------------------------------------
| Finland | 12 057 | 11 003 | 9.6 | 41 028 |
--------------------------------------------------------------------------------
| Scandinavia | 4 030 | 3 279 | 22.9 | 14 698 |
--------------------------------------------------------------------------------
| Europe | 2 799 | 2 284 | 22.6 | 8 985 |
--------------------------------------------------------------------------------
| Other areas | 752 | 573 | 31.2 | 3 512 |
--------------------------------------------------------------------------------
| Sales between | -2 600 | -1 705 | | -8 269 |
| segments | | | | |
--------------------------------------------------------------------------------
| Group total | 12 057 | 11 003 | 9.6 | 41 028 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| (EUR thousand) | | | | |
| | | | | |
--------------------------------------------------------------------------------
| Finland | 3 315 | 3 487 | -4.9 | 12 314 |
--------------------------------------------------------------------------------
| Scandinavia | -229 | -159 | -43.8 | -45 |
--------------------------------------------------------------------------------
| Europe | -1 179 | -494 | -138.6 | -2 831 |
--------------------------------------------------------------------------------
| Other areas | -482 | -289 | -66.9 | -1 297 |
--------------------------------------------------------------------------------
| Operating profit | -15 | -16 | | -62 |
| between segments | | | | |
--------------------------------------------------------------------------------
| Group total | 1 409 | 2 529 | -44.3 | 8 078 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| (employed, in | | | | |
| average) | | | | |
--------------------------------------------------------------------------------
| Finland | 353 | 353 | 0 | 346 |
--------------------------------------------------------------------------------
| Scandinavia | 93 | 87 | 6.9 | 89 |
--------------------------------------------------------------------------------
| Europe | 65 | 57 | 14.1 | 62 |
--------------------------------------------------------------------------------
| Other areas | 22 | 14 | 57.1 | 17 |
--------------------------------------------------------------------------------
| Group total | 532 | 511 | 4.1 | 513 |
--------------------------------------------------------------------------------
Business segments (secondary segment)
--------------------------------------------------------------------------------
| Net sales | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| (EUR thousand) | | | | |
--------------------------------------------------------------------------------
| Product sales | 6 716 | 5 440 | 23.5 | 6 716 |
--------------------------------------------------------------------------------
| Consulting and | 4 958 | 4 470 | 10.9 | 4 958 |
| services | | | | |
--------------------------------------------------------------------------------
| Maintenance and | 5 021 | 5 181 | -3.1 | 5 021 |
| support | | | | |
--------------------------------------------------------------------------------
| Other operations | 343 | 341 | 0.3 | 343 |
--------------------------------------------------------------------------------
| Group total | 17 038 | 15 432 | 10.4 | 17 038 |
--------------------------------------------------------------------------------
Geographical division of net sales by the location of customer
--------------------------------------------------------------------------------
| Net sales (EUR | 1-3/2007 | 1-3/2006 | Change, % | 1-12/2006 |
| thousand) | | | | |
--------------------------------------------------------------------------------
| Finland | 9 360 | 9 175 | 2.0 | 32 557 |
--------------------------------------------------------------------------------
| Scandinavia | 3 929 | 3 201 | 22.7 | 14 129 |
--------------------------------------------------------------------------------
| Europe | 2 831 | 2 561 | 10.6 | 9 421 |
--------------------------------------------------------------------------------
| Other areas | 918 | 495 | 85.1 | 3 848 |
--------------------------------------------------------------------------------
| Group total | 17 038 | 15 432 | 10.4 | 59 954 |
--------------------------------------------------------------------------------
GROUP KEY INDICATORS
--------------------------------------------------------------------------------
| EUR thousand | 1-3/2007 | 1-3/2006 | 1-12/2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 17 038 | 15 432 | 59 954 |
--------------------------------------------------------------------------------
| Growth of net sales, % | 10.4% | 89.7% | 43.9% |
--------------------------------------------------------------------------------
| Operating profit | 1 409 | 2 529 | 8 078 |
--------------------------------------------------------------------------------
| Growth of operating profit, % | -44.3% | 1665.6% | 123.7% |
--------------------------------------------------------------------------------
| % of net sales | 8.3% | 16.4% | 13.5% |
--------------------------------------------------------------------------------
| Profit before tax | 1 459 | 2 606 | 8 287 |
--------------------------------------------------------------------------------
| % of net sales | 8.6% | 16.9% | 13.8% |
--------------------------------------------------------------------------------
| Profit for the period | 884 | 1 994 | 4 986 |
--------------------------------------------------------------------------------
| % of net sales | 5.2% | 12.9% | 8.3% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on equity, % | 8.0% | 26.0% | 15.1% |
--------------------------------------------------------------------------------
| Return on investment, % | 13.1% | 33.5% | 24.7% |
--------------------------------------------------------------------------------
| Interest bearing liabilities | 658 | 1 113 | 758 |
--------------------------------------------------------------------------------
| Cash and liquid assets *) | 12 713 | 11 153 | 8 975 |
--------------------------------------------------------------------------------
| Gearing, % | -27.5% | -25.1% | -18.4% |
--------------------------------------------------------------------------------
| Equity ratio, % | 68.8% | 68.8% | 77.5% |
--------------------------------------------------------------------------------
| Total assets | 63 679 | 58 237 | 57 558 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross investments **) | 767 | 21 695 | 25 315 |
--------------------------------------------------------------------------------
| % of net sales | 4.5% | 140.6% | 42.2% |
--------------------------------------------------------------------------------
| Capital expenditure | 169 | 158 | 597 |
--------------------------------------------------------------------------------
| % of net sales | 1.0% | 1.0% | 1.0% |
--------------------------------------------------------------------------------
| Research and development costs | 3 091 | 2 639 | 10 925 |
--------------------------------------------------------------------------------
| % of net sales | 18.1% | 17.1% | 18.2% |
--------------------------------------------------------------------------------
| R&D personnel at end of period | 136 | 141 | 138 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Personnel average for period | 532 | 511 | 514 |
--------------------------------------------------------------------------------
| Personnel at end of period | 533 | 513 | 528 |
--------------------------------------------------------------------------------
| Growth of personnel, % | 3.9% | 60.8% | 33.7% |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0.08 | 0.19 | 0.45 |
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0.08 | 0.19 | 0.44 |
| (diluted) | | | |
--------------------------------------------------------------------------------
| Equity per share, EUR | 3.83 | 3.53 | 3.88 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Average share number: | | | |
--------------------------------------------------------------------------------
| - undiluted | 11 468 124 | 10 432 080 | 11 172 612 |
--------------------------------------------------------------------------------
| - diluted | 11 468 124 | 10 529 780 | 11 221 052 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
*) Includes cash, cash equivalents and financial assets at fair value through
profit or loss
**) Includes capitalized R&D costs and acquisitions
MAJOR SHAREHOLDERS
March 30, 2007
--------------------------------------------------------------------------------
| | | Shares and | votes |
--------------------------------------------------------------------------------
| | | Number | % |
--------------------------------------------------------------------------------
| 1. | Sihvo, Ilkka | 1 065 800 | 9.3 |
--------------------------------------------------------------------------------
| 2. | Vaajoensuu, Hannu | 1 045 800 | 9.2 |
| | (incl. a controlled | | |
| | company and children under guardianship) | | |
--------------------------------------------------------------------------------
| 3. | Eräkangas, Kirsi (incl. children under | 1 031 800 | 9.0 |
| | guardianship) | | |
--------------------------------------------------------------------------------
| 4. | Perttunen, Sakari | 830 400 | 7.2 |
--------------------------------------------------------------------------------
| 5. | Pöllänen, Antti (incl. children under | 800 900 | 7.0 |
| | guardianship) | | |
--------------------------------------------------------------------------------
| 6. | Nordea Small cap Fund | 465 997 | 4.1 |
--------------------------------------------------------------------------------
| 7. | Ahonen, Asko | 333 822 | 2.9 |
--------------------------------------------------------------------------------
| 8. | Veritas Pension Insurance Company | 216 000 | 1.9 |
--------------------------------------------------------------------------------
| 9. | Perttunen, Meimi | 215 400 | 1.9 |
--------------------------------------------------------------------------------
| 10. | Royal Skandia Life Assurance | 210 000 | 1.8 |
--------------------------------------------------------------------------------
| 11. | Fondita Nordic Small Cap Fund | 190 000 | 1.7 |
--------------------------------------------------------------------------------
| 12. | Henki-Sampo Insurance Company | 155 000 | 1.4 |
--------------------------------------------------------------------------------
| 13. | Fides Finland Focus Investment Fund | 111 627 | 1.0 |
--------------------------------------------------------------------------------
| 14. | OP Finland Small Firm Fund | 106 000 | 0.9 |
--------------------------------------------------------------------------------
| 15. | Sarvala, Vesa | 102 741 | 0.9 |
--------------------------------------------------------------------------------
| 16. | Veritas Life Insurance Company Ltd | 100 000 | 0.9 |
--------------------------------------------------------------------------------
| 17. | Luoto, Matti | 99 450 | 0.9 |
--------------------------------------------------------------------------------
| 18. | Kaleva Mutual Insurance Company | 93 800 | 0.8 |
--------------------------------------------------------------------------------
| 19. | Nordea Fennia Plus Fund | 86 000 | 0.7 |
--------------------------------------------------------------------------------
| 20. | Fondita Nordic Micro Cap Placeringsfond | 60 000 | 0.5 |
--------------------------------------------------------------------------------
| | 20 largest shareholders total | 7 320 537 | 63.8 |
--------------------------------------------------------------------------------
| | Nominee-registered shares total | 1 549 808 | 13.5 |
--------------------------------------------------------------------------------
| | Others | 2 597 779 | 2.7 |
--------------------------------------------------------------------------------
| | Total | 11 468 124 | 100.0 |
--------------------------------------------------------------------------------
