F-Secure Oyj · OMXHEX:FSECURE
F-Secure Oyj — Q1 2011 Earnings Presentation
33 slides from F-Secure Oyj's earnings presentation, Apr 27, 2011
Slide 1: F-Secure Corporation - Interim report Q1 2011
F-Secure Corporation - Interim report Q1 2011 (Unaudited) April 27, 2011 Kimmo Alkio, President & CEO Protecting the irreplaceable | f-secure.com
Slide 2: Q1 highlights
Q1 highlights • Operator revenue growth accelerated significantly, healthy profitability • Security subscription growth continues strong; storage business supporting growth • Major achievements in winning new Operators; market expansion to Latin America with new partnerships • Exciting future outloo
Slide 3: We enable millions of people to safely enjoy their connected lives
We enable millions of people to safely enjoy the exciting opportunities of their connected lives 2011: Leader in providing value added services to consumers through operators 3 March 30, 2011
Slide 4: Contents
Contents 1. Financial performance in Q1 2011 2. Operator business 3. Q1 key service & product launches 4. Market review 5. Long term objectives & Outlook for 2011 4 April 27, 2011
Slide 5: 1. Financial performance in Q1 2011
1. Financial performance in Q1 2011 5
Slide 6: Q1 Revenue and EBIT
Q1 Revenue and EBIT • Revenue growth accelerated in EURm Q1 driven by operator channel 40 • Total quarterly revenues 34.1m; growth of 9% (Q110: 31.4m) 35 • Operator revenues (incl. Storage 30 and Digital Content business) 18.7m, growth of 20% compared 25 to Q110 and 2 % from Q410 (Q110: 15.6m) 20 •
Slide 7: Q1 Costs
Q1 Costs EURm 35 • Total costs 27.2m as anticipated (Q110: 24.1m) 30 • Storage and digital content business 25 investments 20 • Capitalization of research & development costs; during Q111 15 impact ~1.0m (0.7m) 10 • Focus further on storage services and 5 portfolio development 0 Sales & Marketing Re
Slide 8: Q1 Operating profit
Q1 Operating profit EURm • Operating profit level at a good 8 level 7 • EBIT 5.5m , 16% of revenues (Q110: 5.5m, 18%). 6 • Equity ratio: 5 • Mar. 31, 2011 60%* 4 • Dec. 30, 2010 69% 3 • Sep. 30, 2010 71% 2 1 *69% if dividend paid in March 0 EBIT Q410 excluding restructuring costs 8
Slide 9: Development of EBIT margin
Development of EBIT margin • Prioritising growth over short 30 % term profitability, currently investing in Storage business 25 % • Seeking to improve profitability 20 % longer term towards 25% EBIT level 15 % The graph shows the EBIT excluding the non-recurring 10 % impairment loss of Network Contr
Slide 10: Q1 Cash position
Q1 Cash position EURm • Cash flow from operations was 7.1m Capital repayment Dividend pay-out/ positive (Q110: 6.9m) 100 Share buy backs 90 Steek • Cash position remained at a good level acquisition 80 • Market value of liquid assets on 70 Mar.30, 2011: 37.1m 60 Dec.30, 2010: 32.8m 50 Sep.30, 2010:
Slide 11: Q1 Deferred Revenues
Q1 Deferred Revenues EURm 40 • Deferred revenues were at 37.5m (37.2m) ; healthy renewal license sales in 35 channel business • Japan, as one of the key countries for 30 corporate business, impacted by earthquake 25 • Deferred revenues accrued in the balance 20 sheet • Mar. 31, 2011 37.5m 15 • Dec.3
Slide 12: Q1 2011 Regional Revenue Split
Q1 2011 Regional Revenue Split 1-3/2011 1-12/2010 Rest of Rest of World Nordic World 12 % Countries North 12 % 33 % Nordic North America 33 % America 9% 10 % Rest of Rest of Europe Europe 45 % 46 % 12
Slide 13: Number of personnel
Number of personnel • At the end of Q1: 851 (Q410: 812; Q110: 836) 900 • During Q1 new recruitments: 800 supporting growth 700 businesses, mainly in the storage business and R&D 600 500 400 300 200 100 0 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410 Q111 Sales and Marketing Research and Development Admini
Slide 14: 2. Operator business: Strong global partner network
2. Operator business: Strong global partner network
Slide 15: Q1 Operator business
Q1 Operator business EURm • Q1 revenues of 18.7m ( 15.6m); growth 20 of +20% YoY ; +2% QoQ 18 • Healthy security subscriber growth continued; increase in take up rates 16 • Project revenues also in Q1 14 • Increasing number of existing 12 Operators launching combined Security 10 and Storage services
Slide 16: F-Secure in Latin America
F-Secure in Latin America • Long-term regional partnerships with Telefonica and several other operators in Latin America. • Latin America is one of the fastest growing wireless and mobile broadband subscriber market in the world • F-Secure offers its standard solutions: internet protection and stora
Slide 17: More than 200 operator partners globally
More than 200 operator partners globally and over 100 m broadband subscribers 17
Slide 18: 3. Products and Services
3. Products and Services Products and services 18
Slide 19: Products, Services and Technologies
Products, Services and Technologies • F-Secure develops and sells security and storage related services that support personal computers, servers and an increasing set of major smartphone and tablet operating systems • F-Secure is increasing the investment to extend the products and services to new m
Slide 20: Q1 key product & service announcements
Q1 key product & service announcements • F-Secure introduced a new Partner Portal for its resellers. The portal provides advanced online tools for resellers that help them to react quickly and efficiently to end-customers’ needs, boosting sales and customer service. (March 2011) • F-Secure Policy Ma
Slide 21: F-Secure key consumer products
F-Secure key consumer products Full PC protection Better way for online backup 21
Slide 22: 4. Market review
4. Market review Internet expansion, new devices and increasing use of social media strengthen the demand for value added services 22
Slide 23: The number of Internet users increasing
The number of Internet users increasing - more potential customers Milllion Internet users* 3000 2500 Internet in 2015: 2000 • >500m new users 1500 • >2.5B users altogether • Mobile Internet > traditional 1000 broadband 500 0 1985 1990 1995 2000 2005 2010 2015 Source: *eTForecasts, **Morgan Stanley
Slide 24: The number of new devices increasing
The number of new devices increasing - more devices to offer services 10b+ Video in mobile devices Elektronics in cars (GPS, ABS, A/V) Games Wiresless home devices 1b+ Mobile Smartphones devices Electric books 100mi Mobile Tablets phone MP3 Mobile phone / PDA PC Home entertainment Number of devices
Slide 25: Social media increase the use of Internet
Social media increase the use of Internet - protecting identity more and more important 25
Slide 26: Security is needed in Internet
Security is needed in Internet Estimate of increasing malware 18000,000 16000,000 14000,000 12000,000 10000,000 8000,000 6000,000 4000,000 2000,000 ,0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: F-Secure 26
Slide 27: Market trends – summary
Market trends – summary • Internet growth continues globally • Mobile internet driving growth • Role of internet security significant for Internet business over the Internet • Smartphones and tablets growing in number • New devices connected to the Internet are coming to the markets New devices • Ne
Slide 28: 5. Long-term objectives & future outlook
5. Long-term objectives & future outlook 28 © F-Secure Corporation
Slide 29: Operators drive Internet expansion
Operators drive Internet expansion. Long-term market opportunities are attractive for F-Secure. 29
Slide 30: Long-term objectives
Long-term objectives Growth • Continue to exceed average market growth • Geographic expansion • New large operator partnerships Software as a Service • Highly competitive internet security • Combined internet security and online backup services aiming for higher number of subscribers • Room for inno
Slide 31: Outlook for 2011 is unchanged
Outlook for 2011 is unchanged • The growth is driven by Software as a Service business; security sales, storage related project deliveries and storage service sales • The management estimates annual revenue growth to accelerate to around 10% • Annual profitability is expected to improve from 2010 le
Slide 32: Thank you!
Thank you! Forward-looking statements: Certain statements in this presentation are forward-looking, and the actual outcome could be materially different. Such forward-looking statements are based on F- Secure’s present plans, estimates, assumptions, projections and expectations and are subject to ri
Slide 33: Protecting the irreplaceable
Protecting the irreplaceable F-Secure.