Yahoo Finance QPR Software Interim Report January – September 2021
QPR SOFTWARE STOCK EXCHANGE RELEASE, OCTOBER 22, 2021 AT 9.00 AM
Net sales increased 13% and operating profit improved in July – September 2021
January – September 2021
Net sales amounted to EUR 7,085 thousand (January – September 2020: 6,630), growth 7%.
SaaS net sales as well as consulting and software license net sales increased. Software maintenance net sales decreased from previous year.
International net sales represented 51% of Group net sales (47).
EBITDA increased to EUR 671 thousand (221).
Operating result (EBIT) amounted to EUR -198 thousand (-752).
Earnings per share EUR -0.019 (-0.055).
July – September 2021
Net sales amounted to EUR 2,043 thousand (July – September 2020: 1,801).
Net sales increased 13%, driven by growth in international net sales.
SaaS net sales as well as consulting and software license net sales increased.
EBITDA amounted to EUR 103 thousand (-109).
Operating result (EBIT) amounted to EUR -208 thousand (-413).
Operating expenses remained on the same level as in previous year.
Business operations
QPR Software´s mission is to make customers agile and efficient in their operations. We innovate, develop, and sell software for analyzing, monitoring, and modeling organizations’ operations. Furthermore, we offer customers consulting services related to our software.
Outlook for 2021 (adjusted)
The exceptional circumstances caused by the Covid-19 pandemic continue to affect new customer acquisition, but there are signs of customer decision making normalizing when it comes to software procurement. Based on actual net sales year-to-date, recurring customer revenues, consulting booking levels, and the current portfolio of sales opportunities, QPR expects its net sales to grow by 4-9% in 2021 (2020: EUR 8,971 thousand), and EBITDA and operating result to improve compared to 2020.
KEY FIGURES | |||||||
EUR in thousands, | July-Sept, | July-Sept, | Change, | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, |
Net sales | 2,043 | 1,801 | 13 | 7,085 | 6,630 | 7 | 8,971 |
EBITDA | 103 | -109 | 194 | 671 | 221 | 204 | 248 |
% of net sales | 5.0 | -6.1 | 9.5 | 3.3 | 2.8 | ||
Operating result | -208 | -413 | 50 | -198 | -752 | 74 | -936 |
% of net sales | -10.2 | -22.9 | -2.8 | -11.3 | -10.4 | ||
Result before tax | -213 | -419 | 49 | -291 | -761 | 62 | -952 |
Result for the period | -165 | -345 | 52 | -225 | -655 | 66 | -812 |
% of net sales | -8.1 | -19.1 | -3.2 | -9.9 | -9.0 | ||
Earnings per share, EUR | -0.014 | -0.029 | 52 | -0.019 | -0.055 | -66 | -0.068 |
Equity per share, EUR | 0.144 | 0.199 | -28 | 0.144 | 0.199 | -28 | 0.161 |
Cash flow from operating | -642 | -890 | 28 | 569 | 101 | 464 | 334 |
Cash and cash equivalents | 251 | 317 | -21 | 251 | 317 | -21 | 185 |
Net borrowings | 1,002 | 459 | 118 | 1,002 | 459 | 118 | 762 |
Gearing, % | 55.8 | 21.4 | 161 | 55.8 | -21.4 | 361 | 38.0 |
Equity ratio, % | 36.9 | 47.0 | -21 | 36.9 | 47.0 | -21 | 34.6 |
Return on equity, % | -34.9 | -59.5 | 41 | -15.8 | 35.5 | -145 | -34.1 |
Return on investment, % | -14.2 | -59.3 | 76 | -8.8 | -30.0 | 71 | -28.0 |
REPORTING
QPR Software innovates, develops, sells, and delivers software and services in international markets aimed at facilitating operational development in organizations. QPR Software reports one operating segment: Operational development of organizations. In addition to this, the Company reports revenue from products and services as follows: Software licenses, Renewable software licenses, Software maintenance services, SaaS (Software-as-a-Service), and Consulting.
Recurring revenue reported by the Company consists of SaaS net sales, Renewable software licenses, and Software maintenance services.
Software licenses are sold to customers for perpetual use or for an agreed, limited time period. Renewable software licenses are sold to customers as a user right with an indefinite duration. These contracts are automatically renewed at the end of the agreed period, usually one year, unless the agreement is terminated within notice period. Renewable license revenue is recognized at one point in time, in the beginning of the invoicing period.
Geographical areas reported are Finland, the rest of Europe (including Russia and Turkey), and the rest of the world. Net sales are reported according to the location of the customer´s headquarters.
REVIEW BY THE CEO
The Company's net sales grew by 13% in the third quarter when compared year on year. Software license revenue and SaaS revenue, which are central to long-term success, grew driven by international sales. Consulting revenue grew clearly, especially supported by ongoing long-term customer relationships. Although the negative effects of the Covid-19 pandemic were still felt in the new logo sales of software solutions, the Company won several contracts, entering into, among others, a major process software deal with a global technology Company and expanding its cooperation with several major current customers.
The Company continues to invest in the process excellence business with sales and business development resources as well as new sales channels in 2021. The measures taken support the positive development in the new sales of QPR ProcessAnalyzer, the process mining software, and for expanding usage with current customers. In the past quarter, the Company started developing functionalities for task mining, which will enable customers to have a more operational understanding and actionable insights for the development of business processes.
The pilot deliveries of QPR Business Portal, a solution for the development of organizations’ operations and quality systems, have progressed and we are developing the next phase of capabilities in cooperation with our customers. The feedback received through customer co-creation have already resulted in the design and implementation of new features for role-based views and metrics in the solution in production.
The sales of performance management software, QPR Metrics, and related software consulting have increased over the past year in the Middle Eastern market. During the reporting period, we strengthened our solution delivery capability by hiring a new delivery team leader and further developing our software solution. Tero Aspinen, a member of the Management Team responsible for business in the Middle East, moved to Dubai in August to support our local partner network in sales and business development.
After long-term CEO, Jari Jaakkola, left his position, I started as the new CEO on October 1, 2021. I want to thank Mr. Jaakkola for his meaningful contribution to the development and management of the Company during his 13-year tenure as CEO. QPR Software is celebrating its 30th anniversary this year as a pioneer and leader in its industry. The position we have achieved among a broad and significant international customer base, combined with a strong product portfolio and service offering, creates a solid foundation for the Company's success and growth in the future.
Jussi Vasama
Chief Executive Officer
NET SALES DEVELOPMENT
NET SALES BY PRODUCT GROUP | |||||||
EUR in thousands | July-Sept, | July-Sept, | Change, | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, |
Software licenses | 289 | 271 | 7 | 1,155 | 937 | 23 | 1,344 |
Renewable software licenses | 140 | 125 | 12 | 664 | 733 | -9 | 900 |
Software maintenance services | 528 | 519 | 2 | 1,527 | 1,677 | -9 | 2,195 |
SaaS | 308 | 284 | 9 | 949 | 820 | 16 | 1,081 |
Consulting | 779 | 602 | 29 | 2,790 | 2,463 | 13 | 3,452 |
Total | 2,043 | 1,801 | 13 | 7,085 | 6,630 | 7 | 8,971 |
NET SALES BY GEOGRAPHIC AREA | |||||||
EUR in thousands | July-Sept, | July-Sept, | Change, | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, |
Finland | 907 | 965 | -6 | 3,500 | 3,524 | -1 | 4,718 |
Europe incl. Russia and Turkey | 764 | 480 | 59 | 1,996 | 1,758 | 14 | 2,474 |
Rest of the world | 372 | 355 | 5 | 1,589 | 1,348 | 18 | 1,780 |
Total | 2,043 | 1,801 | 13 | 7,085 | 6,630 | 7 | 8,971 |
July - September 2021
Net sales in the third quarter increased by 13% and amounted to EUR 2,043 thousand (1,801). Significant growth in consulting (+29%) and in SaaS net sales (+9%) had a positive impact on net sales. The annual value of SaaS offers to customers increased year-on-year by over 60% to almost EUR 2.5 million.
Consulting net sales, including software deliveries, amounted to EUR 779 thousand (602). Software deliveries were positively impacted by significant projects sold to the Middle East early this year. SaaS net sales increased to EUR 308 thousand (284),
New software license net sales increased to EUR 289 thousand (271) and renewable software license net sales to EUR 140 thousand (125). SaaS net sales increased 9% to EUR 308 thousand (284).
Software maintenance net sales amounted to EUR 528 thousand (519).
Net sales in Finland decreased by 6%, but international net sales increased by 36%. Of the Group net sales, 44% (54) derived from Finland, 37% (27) from the rest of Europe (including Russia and Turkey), and 16% (20) from the rest of the world.
January - September 2021
Net sales between January and September amounted to EUR 7,085 thousand (6,630) and increased by 7%. The share of recurring revenue was 43% of net sales (49).
Net sales in Finland were on the same level as in the previous year (-1%). International net sales increased by 15%, driven by software sales.
Of the Group net sales, 49% (53) derived from Finland, 28% (27) from the rest of Europe (including Russia and Turkey), and 22% (20) from the rest of the world.
FINANCIAL PERFORMANCE
July - September 2021
The Group´s EBITDA amounted to 103 thousand (-109) and operating result (EBIT) to EUR -208 thousand (-413). The improvement in operating result was mainly due to an increase in net sales. Operating expenses were at a similar level as the year before (-2%).
The result for the period was EUR -165 thousand (-345). Earnings per share were EUR -0.014 (-0.029).
January - September 2021
The Group´s EBITDA amounted to EUR 671 thousand (221) and operating result (EBIT) amounted to EUR -198 thousand (-752). The improvement in operating result was due to an increase in net sales and a decrease in depreciation. Operating expenses remained almost at the same level as the year before (-1%).
The Group´s fixed costs were EUR 6,401 thousand (6,503) in the reporting period. Credit losses, included in fixed costs, were EUR 60 thousand (47).
The result before taxes was EUR -291 thousand (-761) and the result for the period was EUR -225 thousand (-655). Earnings per share were EUR -0.019 (-0.055).
FINANCE AND INVESTMENTS
Cash flow from operating activities between January and September was EUR 569 thousand (101). Cash and cash equivalents at the end of the reporting period were EUR 251 thousand (317).
Net financial expenses were EUR 93 thousand (9) and included a one-off guarantee payment related to a closed project. The payment was made in January 2021.
Investments between January and September totaled EUR 593 thousand (777). Investments were mainly related to product development expenditure.
The Group´s financial position is good. Cash and cash equivalents at the end of the reporting period were EUR 251 thousand (317), in addition to which the Group has access to EUR 1.0 million worth of other short-term financial instruments. At the end of the period, the Group had a short-term bank loan of EUR 1.0 million and no long-term interest-bearing bank loans. The gearing ratio was 56% (23). At the end of the reporting period, the equity ratio was 37% (47).
PRODUCT DEVELOPMENT
QPR innovates and develops software products that analyze, measure, and model organization’s operations. The Company develops the following software products: QPR ProcessAnalyzer, QPR BusinessPortal, QPR EnterpriseArchitect, QPR ProcessDesigner, and QPR Metrics.
From January to September, product development expenses were EUR 1,409 thousand (1,587) and product development expenses worth EUR 542 thousand (627) were capitalized. The amortization of capitalized product development expenses stood at EUR 542 thousand (629). Capitalized product development expenses are amortized over a period of four years.
PERSONNEL
At the end of the quarter, the Group employed a total of 79 persons (85). The average number of personnel during the quarter was 80 (86).
The average age of employees is 42.9 (42) years. Women account for 25% (20) of employees, men for 75% (80). Of all personnel, 20% (19) work in sales and marketing, 39% (42) in consulting and customer care, 33% (31) in product development, and 8% (9) in administration.
For incentive purposes, the Company has a bonus program that covers all employees. Short-term remuneration of the top management consists of salary, fringe benefits, and a possible annual bonus mainly based on the Group and business unit net sales performance. Furthermore, the Company has a key employee stock option plan in use.
SHARES AND SHAREHOLDERS | ||||
Trading of shares | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, |
Shares traded, pcs | 1,737,247 | 714,500 | 143 | 1,403,426 |
Volume, EUR | 3,639,851 | 1,462,356 | 149 | 2,825,365 |
% of shares | 14.5 | 6.0 | 11.7 | |
Average trading price, EUR | 2.10 | 2.05 | 2 | 2.01 |
Shares and market capitalization | September 30, | September 30, | Change, | Dec 31, |
Total number of shares, pcs | 12,444,863 | 12,444,863 | - | 12,444,863 |
Treasury shares, pcs | 457,009 | 457,009 | - | 457,009 |
Book counter value, EUR | 0.11 | 0.11 | - | 0.11 |
Outstanding shares, pcs | 11,987,854 | 11,987,854 | - | 11,987,854 |
Number of shareholders | 1,412 | 1,179 | 20 | 1,240 |
Closing price, EUR | 1,98 | 1,96 | 1 | 2,24 |
Market capitalization, EUR | 23,735,951 | 23,496,194 | 1 | 26,852,793 |
Book counter value of all treasury | 50,271 | 50,271 | - | 50,271 |
Total purchase value of all treasury | 439,307 | 439,307 | - | 439,307 |
Treasury shares, % of all shares | 3.7 | 3.7 | - | 3.7 |
GOVERNANCE
In March 2021, the Board of Directors gave a notice to the shareholders of QPR Software Plc that the Annual General Meeting will be held on Thursday March 25, 2021. The Board of Directors of the Company resolved on extraordinary measures pursuant to the temporary legislation approved by the Finnish Parliament. In order to prevent the spread of the Covid-19 pandemic, the Annual General Meeting was held without shareholders’ presence at the Meeting venue. Participation and exercise of shareholder rights in the Meeting was possible only by way of proxy representation, by submitting counterproposals and asking questions in advance.
The Annual General Meeting approved the Board's proposal that no dividend be paid for the financial year 2020. The Annual General Meeting made an advisory decision on the Remuneration Report and decided to approve the presented Remuneration Report.
The Annual General Meeting resolved that the number of Board Members is four (4) and elected Pertti Ervi, Matti Heikkonen, Antti Koskela, and Jukka Tapaninen members of the Company´s Board of Directors. The term of office of the members of the Board of Directors expires at the end of the next Annual General Meeting. At its organizing meeting, the Board of Directors elected Pertti Ervi as its Chairman.
The Annual General Meeting elected Authorized Public Accountants KPMG Oy Ab as QPR Software´s auditor with Miika Karkulahti, Authorized Public Accountant, acting as principal auditor. The term of office of the auditor expires at the end of the next Annual General Meeting.
The Annual General Meeting decided to authorize the Board of Directors to decide on conveyance of the own shares held by the Company (share issue) either on one or several occasions. The share issue can be carried out as a share issue against payment or without consideration on terms to be determined by the Board of Directors.
All authorizations of the Board and other decisions made by the previous Annual General Meeting are available in their entirety in the stock exchange release published by the Company on March 25, 2021. The release can be found in Investors section of the Company's website, https://www.qpr.com/investors/stock-exchange-and-press-releases.
Jari Jaakkola announced on May 5, 2021, to the Board of Directors that he will resign as the Company’s Chief Executive Officer. To ensure a smooth transition, the Board and Jaakkola agreed that Jaakkola will continue in office until approximately the beginning of September. The Board of Directors appointed on June 24, 2021, Jussi Vasama as the new CEO of QPR Software Plc. He assumed his position on October 1, 2021. Vasama has a Master's degree in Industrial Engineering and Management, specializing in the international operations of industrial companies. He has held various global and regional management positions in the software industry since 2012.
SHORT-TERM RISKS AND UNCERTAINTIES
Internal control and risk management at QPR Software aims to ensure that the Company operates efficiently and effectively, distributes reliable information, complies with regulations and operational principles, reaches its strategic goals, reacts to changes in the market and operational environment, and ensures the continuity of its business.
QPR has identified the following three groups of risks related to its operations: risks related to business operations (country, customer, personnel, legal), risks related to information and products (QPR products, IPR, data security) and risks related to financing (foreign currency, short-term cash flow). The Company has an insurance policy covering property, operational, and liability risks.
Financial risks include reasonable credit risk concerning individual business partners, which is characteristic of any international business. QPR seeks to limit this risk by continuously monitoring standard payment terms, receivables and credit limits.
Approximately 61% of the Group’s trade receivables were in euro at the end of the quarter (44). At the end of the quarter, the Company had not hedged its non-euro trade receivables.
Risks and risk management practices related to the Company’s business are further described in the Annual Report 2020, pages 22-24 (https://www.qpr.com/investors/financial-information/annual-reports)
QPR SOFTWARE PLC
BOARD OF DIRECTORS
Further information:
Jussi Vasama, CEO
Tel. +358 (0) 50 380 9893
Distribution:
NASDAQ OMX Helsinki Ltd
Main Media
Neither this press release nor any copy of it may be taken, transmitted or distributed, directly or indirectly, in or into the United States of America or its territories or possessions.
FINANCIAL STATEMENTS
CONSOLIDATED COMPREHENSIVE INCOME STATEMENT | ||||||||||||||||||||
EUR in thousands, unless | July-Sept, | July-Sept, | Change, | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, | |||||||||||||
Net sales | 2,043 | 1,801 | 13 | 7,085 | 6,630 | 7 | 8,971 | |||||||||||||
Other operating income | 0 | 75 | -100 | 0 | 100 | - | 100 | |||||||||||||
Materials and services | 248 | 279 | -11 | 882 | 979 | -10 | 1,422 | |||||||||||||
Employee benefit expenses | 1,434 | 1,474 | -3 | 4,898 | 4,970 | -1 | 6,649 | |||||||||||||
Other operating expenses | 259 | 232 | 12 | 633 | 560 | 13 | 753 | |||||||||||||
EBITDA | 103 | -109 | 194 | 671 | 221 | 204 | 248 | |||||||||||||
Depreciation and amortization | 311 | 304 | 2 | 869 | 972 | -11 | 1,183 | |||||||||||||
Operating result | -208 | -413 | 50 | -198 | -752 | 74 | -936 | |||||||||||||
Financial income and expenses | -5 | -6 | 14 | -93 | -9 | -941 | -16 | |||||||||||||
Result before tax | -213 | -419 | 49 | -291 | -761 | 62 | -952 | |||||||||||||
Income taxes | 49 | 74 | -34 | 66 | 106 | -38 | 140 | |||||||||||||
Result for the period | -165 | -345 | 52 | -225 | -655 | 66 | -812 | |||||||||||||
Earnings per share, EUR | -0.014 | -0.029 | 52 | -0.019 | -0.055 | 66 | -0.068 | |||||||||||||
Consolidated statement of | ||||||||||||||||||||
Result for the period | -165 | -345 | 52 | -225 | -655 | 66 | -812 | |||||||||||||
Other items in comprehensive | ||||||||||||||||||||
Exchange differences on | 2 | -1 | 300 | 3 | -1 | 400 | -3 | |||||||||||||
Total comprehensive income | -163 | -346 | -53 | -222 | -656 | 66 | -814 | |||||||||||||
| ||||||||||||||||||||
EUR in thousands | Sept 30, | Sept 30, | Change, | Dec 31, | ||||||||||||||||
Assets | ||||||||||||||||||||
Non-current assets: | ||||||||||||||||||||
Intangible assets | 2,003 | 1,975 | 1 | 2,054 | ||||||||||||||||
Goodwill | 513 | 513 | 0 | 513 | ||||||||||||||||
Tangible assets | 156 | 75 | 108 | 176 | ||||||||||||||||
Right-of-use assets | 221 | 190 | 16 | 211 | ||||||||||||||||
Other non-current assets | 360 | 263 | 37 | 277 | ||||||||||||||||
Total non-current assets | 3,252 | 3,016 | 8 | 3,231 | ||||||||||||||||
Current assets: | ||||||||||||||||||||
Trade and other receivables | 2,045 | 1,949 | 5 | 2,901 | ||||||||||||||||
Cash and cash equivalents | 251 | 317 | -21 | 185 | ||||||||||||||||
Total current assets | 2,297 | 2,266 | 1 | 3,086 | ||||||||||||||||
Total assets | 5,549 | 5,282 | 5 | 6,317 | ||||||||||||||||
Equity and liabilities | ||||||||||||||||||||
Equity: | ||||||||||||||||||||
Share capital | 1,359 | 1,359 | 0 | 1,359 | ||||||||||||||||
Other funds | 21 | 21 | 0 | 21 | ||||||||||||||||
Treasury shares | -439 | -439 | 0 | -439 | ||||||||||||||||
Translation differences | -67 | -67 | 0 | -69 | ||||||||||||||||
Invested non-restricted equity fund | 5 | 5 | 0 | 5 | ||||||||||||||||
Retained earnings | 916 | 1,270 | -28 | 1,126 | ||||||||||||||||
Equity attributable to shareholders of | 1,795 | 2,149 | -16 | 2,004 | ||||||||||||||||
Current liabilities: | ||||||||||||||||||||
Interest-bearing liabilities | 1,000 | 700 | 43 | 700 | ||||||||||||||||
Interest-bearing lease liabilities | 254 | 77 | 229 | 247 | ||||||||||||||||
Advances received | 684 | 708 | -3 | 527 | ||||||||||||||||
Accrued expenses and prepaid income | 1,303 | 1,267 | 3 | 2,305 | ||||||||||||||||
Trade and other payables | 513 | 381 | 35 | 533 | ||||||||||||||||
Total current liabilities | 3,753 | 3,133 | 20 | 4,313 | ||||||||||||||||
Total liabilities | 3,753 | 3,133 | 20 | 4,313 | ||||||||||||||||
Total equity and liabilities | 5,549 | 5,282 | 5 | 6,317 | ||||||||||||||||
| ||||||||||||||||||||
EUR in thousands | July-Sept, | July-Sept, | Change, | Jan-Sept, | Jan-Sept, | Change, | Jan-Dec, | |||||||||||||
Cash flow from operating activities: | ||||||||||||||||||||
Result for the period | -165 | -345 | 52 | -225 | -655 | 66 | -812 | |||||||||||||
Adjustments to the result | 294 | 263 | 12 | 887 | 930 | -5 | 1,135 | |||||||||||||
Working capital changes | -742 | -796 | -7 | 72 | -149 | -148 | 45 | |||||||||||||
Interest and other financial | -2 | -7 | 75 | -150 | -34 | -341 | -40 | |||||||||||||
Interest and other financial | 1 | 1 | -34 | 2 | 25 | 91 | 27 | |||||||||||||
Income taxes paid | -28 | -6 | -370 | -17 | -16 | -4 | -21 | |||||||||||||
Net cash from operating activities | -642 | -890 | 28 | 569 | 101 | 464 | 334 | |||||||||||||
Cash flow from investing activities: | ||||||||||||||||||||
Purchases of tangible and | -215 | -124 | 73 | -593 | -777 | -24 | -1,098 | |||||||||||||
Net cash used in investing activities | -215 | -124 | 73 | -593 | -777 | -24 | -1,098 | |||||||||||||
Cash flow from financing activities: | ||||||||||||||||||||
Proceeds from short term | 300 | 700 | -57 | 1,000 | 700 | 43 | 700 | |||||||||||||
Repayments of short term | - | - | - | -700 | -700 | 0 | -500 | |||||||||||||
Payment of lease liabilities | -69 | -76 | 9 | -208 | -28 | 642 | -261 | |||||||||||||
Net cash used in financing activities | 231 | 624 | -63 | 92 | -28 | 430 | -61 | |||||||||||||
Net change in cash and cash | -626 | -390 | -61 | 68 | -704 | 110 | -825 | |||||||||||||
Cash and cash equivalents | 878 | 722 | 22 | 185 | 1,035 | -82 | 1,035 | |||||||||||||
Effects of exchange rate changes | -1 | -14 | 95 | -2 | -14 | 88 | -25 | |||||||||||||
Cash and cash equivalents | 251 | 317 | -21 | 251 | 317 | -21 | 185 | |||||||||||||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | |||||||
EUR in thousands | Share | Other | Translation | Treasury | Invested non- | Retained | Total |
Equity Jan 1, 2020 | 1,359 | 21 | -66 | -439 | 5 | 1,882 | 2,762 |
Stock option scheme | 42 | 42 | |||||
Comprehensive income | -1 | -655 | -656 | ||||
Equity Sept 30, 2020 | 1,359 | 21 | -67 | -439 | 5 | 1,270 | 2,149 |
Stock option scheme | 14 | 14 | |||||
Comprehensive income | -3 | -157 | -159 | ||||
Equity Dec 31, 2020 | 1,359 | 21 | -70 | -439 | 5 | 1,126 | 2,004 |
Stock option scheme | 15 | 15 | |||||
Comprehensive income | 3 | -225 | -222 | ||||
Equity Sept 30, 2021 | 1,359 | 21 | -67 | -439 | 5 | 916 | 1,795 |
NOTES TO INTERIM FINANCIAL STATEMENTS
ACCOUNTING PRINCIPLES
This report complies with requirements of IAS 34 ”Interim Financial Reporting”. Starting from the beginning of 2021, the Group has applied certain new or revised IFRS standards and IFRIC interpretations, as described in the Consolidated Financial Statements 2020. The implementation of these new and revised requirements has not impacted the reported figures. For all other parts, the accounting principles and methods are the same as they were in the 2020 financial statements.
When preparing the consolidated financial statements, management is required to make estimates and assumptions regarding the future and to consider the appropriate application of accounting principles, which means that actual results may differ from those estimated.
All amounts presented in this report are consolidated figures, unless otherwise noted. The amounts presented in the report are rounded, so the sum of individual figures may differ from the sum reported. This report is unaudited.
In April 2021, the IFRS Interpretations Committee issued a final agenda decision on the accounting for the costs of configuring or customizing cloud computing arrangements (IAS 38 Intangible Assets). In this agenda decision, the Interpretation Committee considered whether in applying IAS 38, the customer recognizes an intangible asset in relation to configuration or customization of the application software, and if an intangible asset is not recognized, how does the customer account for the configuration or customization costs. IFRIC agenda decisions do not have an effective date, and they are expected to be applied as soon as possible. As the Group has cloud computing arrangements in place, it has begun an analysis of whether this agenda decision has an impact on the accounting policies applied to the costs of implementing cloud arrangements. The analysis will be performed in the Group during autumn 2021, and the possible effects will be taken into account retrospectively in the 2021 financial statements at the latest.
INTANGIBLE AND TANGIBLE ASSETS | |||
EUR in thousands | Jan-Sept, | Jan-Sept, | Jan-Dec, |
Increase in intangible assets: | |||
Acquisition cost Jan 1 | 11,987 | 11,159 | 11,159 |
Increase | 542 | 627 | 828 |
Increase in tangible assets: | |||
Acquisition cost Jan 1 | 2,622 | 2,487 | 2,487 |
Increase | 45 | 171 | 135 |
CHANGE IN INTEREST-BEARING LIABILITIES | |||
EUR in thousands | Jan-Sept, | Jan-Sept, | Jan-Dec, |
Interest-bearing liabilities Jan 1 | 947 | 784 | 784 |
Proceeds from short term borrowings | 1,249 | 721 | 947 |
Repayments | 942 | 728 | 784 |
Interest-bearing liabilities June 30/Dec 31 | 1,254 | 777 | 947 |
PLEDGES AND COMMITMENTS | ||||
EUR in thousands | Sept 30, | Sept 30, | Dec 31, | Change, |
Business mortgages (held by the Company) | 2,386 | 2,385 | 2,387 | 0 |
Minimum lease payments based on lease agreements: | ||||
Maturing in less than one year | 23 | 7 | 7 | 228 |
Maturing in 1-5 years | 29 | 8 | 7 | 324 |
Total | 52 | 16 | 14 | 285 |
Total pledges and commitments | 2,491 | 2,401 | 2,401 | 4 |
CONSOLIDATED INCOME STATEMENT BY QUARTER | |||||||
EUR in thousands | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
Net sales | 2,043 | 2,138 | 2,904 | 2,341 | 1,801 | 2,041 | 2,789 |
Other operating income | 0 | 0 | 0 | 0 | 75 | 25 | 0 |
Materials and services | 248 | 297 | 337 | 443 | 279 | 260 | 440 |
Employee benefit expenses | 1,434 | 1,692 | 1,772 | 1,679 | 1,474 | 1,757 | 1,739 |
Other operating expenses | 259 | 146 | 228 | 193 | 232 | 109 | 220 |
EBITDA | 103 | 3 | 566 | 27 | -109 | -60 | 390 |
Depreciation and amortization | 311 | 278 | 280 | 211 | 304 | 324 | 345 |
Operating result | -208 | -275 | 286 | -184 | -413 | -384 | 45 |
Financial income and expenses | -5 | -8 | -80 | -8 | -6 | 6 | -9 |
Result before tax | -213 | -283 | 206 | -191 | -419 | -378 | 36 |
Income taxes | 49 | 52 | -35 | 34 | 74 | 57 | -25 |
Result for the period | -165 | -231 | 170 | -157 | -345 | -321 | 11 |
GROUP KEY FIGURES | |||
EUR in thousands, unless | Jan-Sept or | Jan-Sept or | Jan-Dec or |
Net sales | 7,085 | 6,630 | 8,971 |
Net sales growth, % | 6.9 | -5.5 | -5.7 |
EBITDA | 671 | 221 | 248 |
% of net sales | 9.5 | 3.3 | 2.8 |
Operating result | -198 | -752 | -936 |
% of net sales | -2.8 | -11.3 | -10.4 |
Result before tax | -291 | -761 | -952 |
% of net sales | -4.1 | -11.5 | -10.6 |
Result for the period | -225 | -655 | -812 |
% of net sales | -3.2 | -9.9 | -9.0 |
Return on equity (per annum), % | -15.8 | -35.5 | -34.1 |
Return on investment (per annum), % | -8.8 | -30.0 | -28.0 |
Cash and cash equivalents | 251 | 317 | 185 |
Net borrowings | 1,002 | 459 | 762 |
Equity | 1,795 | 2,149 | 2,004 |
Gearing, % | 55.8 | 21.4 | 38.0 |
Equity ratio, % | 36.9 | 47.0 | 34.6 |
Total balance sheet | 5,549 | 5,282 | 6,317 |
Investments in non-current assets | 750 | 798 | 1 210 |
% of net sales | 10.6 | 12.0 | 13.5 |
Product development expenses | 1,409 | 1,587 | 2,050 |
% of net sales | 19.9 | 23.9 | 22.9 |
Average number of personnel | 80 | 86 | 86 |
Personnel at the beginning of period | 88 | 83 | 83 |
Personnel at the end of period | 79 | 85 | 88 |
Earnings per share, EUR | -0.019 | -0.055 | -0.068 |
Equity per share, EUR | 0.144 | 0.173 | 0.161 |
