Announcement No. 17-2007
20 November 2007
Profit announcement for the three months ended 30 September 2007
The Q3 revenue performance failed to meet expectations, while costs were in line
with our forecast. The shortfall in revenue occurred mainly in the Education
business area. Desktop Management revenue was up relative to the first nine
months of 2006. We plan to launch a number of initiatives in order to increase
our focus on the individual segments, and Desktop Management and Education will
become two separate business units during the first quarter of 2008. Instead of
a chief sales officer, a manager will be appointed for each business unit. We
confirm our previous financial guidance.
Q3 revenue was DKK 15.2m (Q3 2006: DKK 19.1m), bringing 9M revenue to DKK 67.3m
(9M 2006: DKK 68.1m). The drop in revenue experienced in Q3 can be ascribed to
internal factors as well as to external market conditions.
The depreciation of the US dollar against Danish kroner pushed down revenue from
the Americas by about 7% in DKK-terms.
Desktop Management revenue was DKK 11.5m in Q3 and DKK 52.8m in the first nine
months of the year, a 10% increase from DKK 48.2m in 9M 2006. Education revenue
was DKK 3.6m in Q3 and DKK 13.7m in 9M 2007 (9M 2006: DKK 18.9m). Security
revenue was DKK 0.8m in 9M 2007 (9M 2006: DKK 1.0m).
Danware recorded an operating loss before depreciation and amortisation (EBITDA)
of DKK 13.0m in Q3 and a DKK 9.1m loss for the first nine months of the year,
which was not satisfactory.
EBIT was a loss of DKK 14.7m in Q3 2007 compared with a loss of DKK 5.2m in the
same period of last year. The 9M EBIT was a loss of DKK 14.5m, compared with a
DKK 3.3m loss in 9M 2006. The expected decline in EBIT was primarily
attributable to the lower-than-expected revenue.
We recorded a net loss of DKK 9.1m in 9M 2007 against a DKK 1.2m loss in the
year-earlier period.
Based on the Q3 revenue performance, Danware downgraded the forecast for 2007 on
24 October 2007 from revenue of DKK 130-135m and EBITDA of approximately DKK 16m
to revenue of DKK 90-100m and an EBITDA loss of approximately DKK 13m. This
forecast is maintained.
Contact
Peter Grøndahl, CEO, tel. +45 4590 2525, e-mail pg@danware.dk
Danware's core business is to develop and market software products based on the
NetOp® core technology - a technology enabling swift, secure and seamless
transfer of screens, sound and data between two or more computers. The company's
three product areas are Desktop Management, Education and Security. The core
product in Desktop Management, NetOp® Remote Control, enables remote control of
one or more computers from another computer. NetOp® School, the core product in
Education, is a software application for computer-based classroom teaching. The
Security business products are NetOp® Desktop Firewall and NetOp® Netfilter. All
are plug ‘n play products offering extensive functionality, flexibility and
user-friendliness. Danware's products are sold in more than 80 countries. In
2006, the company generated revenue of DKK 98m. Danware's shares are listed on
the Copenhagen Stock Exchange (ticker DANW) and are a component of the Small
Cap+ index.
