F-Secure Oyj · OMXHEX:FSECURE
F-Secure Oyj — Q3 2008 Earnings Presentation
22 slides from F-Secure Oyj's earnings presentation, Oct 21, 2008
Slide 1: F-Secure Corporation Interim report 3Q 2008
F-Secure Corporation Interim report 3Q 2008 October 21, 2008 Kimmo Alkio, President and CEO
Slide 2: Q3 Highlights
Q3 Highlights • Solid revenue growth of 18% to 28.6m • All-time high profitability of 7.1m, 25% of revenues • Cash flow strong at 5.3m positive (1.5m) • Portfolio expansion: • on-line back up service for ISPs –first contracts signed • Vodafone: Global Frame Agreement for Mobile security • First oper
Slide 3: Q3 Revenues
Q3 Revenues • Solid overall growth of +18% to 28.6m 30 • Strong ISP growth to 12.3m 25 • +6% quarter over quarter • +31% from 3Q07 (YoY) 20 • Traditional channel sales improved 15 • +10% growth from 3Q07 10 5 0 Revenues Interim Report 3Q08 – October 21 , 2008 Page 3
Slide 4: Q3 Costs
Q3 Costs 25 • Q3 Costs ~19.3m • Following usual seasonality 20 • Continuously investing into future 15 growth • Costs include 10 • Capitalization of Development costs marginal ~0.2m 5 • Gross margin 91% (92%) 0 S&M R&D G&A write-off Interim Report 3Q08 – October 21 , 2008 Page 4
Slide 5: Q3 Operating Result
Q3 Operating Result 8 • EBIT 7.1m – all time high 7 • 25% of revenues • +15% EBIT growth from 3Q07 6 5 • Equity ratio strong 4 • Sep 30, 2008 83% 3 • Jun 30, 2008 82% • Mar 31, 2008 71%* 2 • Dec 31, 2007 82% 1 • Sep 30, 2007 81% 0 -1 -2 * If dividends were paid in March Without impairment loss of Ne
Slide 6: Development of EBIT margin
Development of EBIT margin • Continue to prioritise growth over short 30% term profitability 25% • Average EBIT has improved gradually 20% • The 2-4 year goal is to reach 25% EBIT level 15% 10% 5% 0% Graph shows EBIT without the non-recurring impairment loss of Network Control in 4Q06 EBIT% Ave (4 q
Slide 7: Q3 Cash position
Q3 Cash position Dividend pay-out 100 • Positive cash flow 5.3m 95 90 • Cash flow includes: 85 • Dividend pay-out of 10.9m in April 80 75 • Liquid assets 88.9m (79.9m) 70 • Market value on Sep 30th, 2008 65 60 55 50 Dividend Cash position Interim Report 3Q08 – October 21 , 2008 Page 7
Slide 8: Q3 Deferred Revenues
Q3 Deferred Revenues 35 • Deferred revenues accrued in balance sheet 30 • Sep 30, 2008 33.7m • Jun 30, 2008 33.9m 25 • Mar 31, 2008 33.7m • Dec 31, 2007 31.9m 20 • Sep 30, 2007 29.1m • Development following an annual pattern 15 10 Deferred Revenues Interim Report 3Q08 – October 21 , 2008 Page 8
Slide 9: Regional Revenue Split
Regional Revenue Split 1-9/2008 1-9/2007 9% 9% 9% 9% 39% 39% 43% 43% Nordic Countries RoE North America RoW Interim Report 3Q08 – October 21 , 2008 Page 9
Slide 10: ISP Business – continued strong growth
ISP Business – continued strong growth 14000 • 12.3m of revenues 12000 • 43% of total Q3 revenues 10000 • Strong growth • +6% from 2Q08, +31% from 3Q07 8000 • Growth accelerating activities continued kEUR 6000 • New service launch takes longer than anticipated 4000 2000 0 Interim Report 3Q08 – Octob
Slide 11: Growing number of ISP partners
Growing number of ISP partners 200 • 178 partners in 42 countries 180 • 5 new partners in Q3 160 • Strong competitiveness in signing new 140 partners continues 120 • Q3 significant partner announcements 100 • TDC , Denmark 80 • Tele2, Netherlands 60 • UnityMedia, Germany 40 • On-line backup partners
Slide 12: F-Secure Partners' market share of residential broadband
F-Secure Partners’ market share of residential broadband 40% Europe 35% Partners’ market share of residential 30% broadband at end of 2007 • 37% (34%) in Europe 25% • 10% (10%) in NA 20% • 9% (n/a) in Asia 15% NA ASIA (estimates by Dataxis & F- 10% Secure) 5% 0% 2006 2007 2006 2007 2006 2007 F-Secur
Slide 13: F-Secure Service Provider partners in the Americas
F-Secure Service Provider partners in the Americas Interim Report 3Q08 – October 21 , 2008 Page 13
Slide 14: F-Secure Service Provider partners in EMEA part 1
F-Secure Service Provider partners in EMEA part1 Interim Report 3Q08 – October 21 , 2008 Page 14
Slide 15: F-Secure Service Provider partners in EMEA part 2
F-Secure Service Provider partners in EMEA part 2 Interim Report 3Q08 – October 21 , 2008 Page 15
Slide 16: F-Secure Service Provider partners in APAC
F-Secure Service Provider partners in APAC Interim Report 3Q08 – October 21 , 2008 Page 16
Slide 17: Q3 Mobile Security Business
Q3 Mobile Security Business • Device manufacturers • Continued strong growth in trial usage • Available for a majority of the currently shipping or upcoming Nokia • Slow steady growth in revenues S60 3rd edition devices • Ca 3% of total revenues (Q3) • Partnership with Sony Ericsson and Toshiba Info
Slide 18: Q3 Product announcements
Q3 Product announcements • Internet Security 2009 for consumers • Protection against new online threats using a real-time protection network • In-the-cloud-technology (DeepGuard™ 2.0) • Strong performance and usability enhancement • Excellent results in tests (e.g. AV-Test GmbH.) • Wellbeing 2009 pr
Slide 19: Number of Personnel at the end of Q3
Number of Personnel 710 at the end of Q3 800 700 600 500 400 300 200 100 0 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 S&M R&D G&A Interim Report 3Q08 – October 21 , 2008 Page 19
Slide 20: Future Outlook
Future Outlook • Strategy in a nutshell • Q4 2008 outlook (1) Continue to drive growth • Revenues 29.5-31.5m (2) Capitalize on industry leadership in Security • Costs below 22 m as a Service (3) Develop leadership in mobile security • FY 2008 outlook • Investing in growth • Expected revenues 112-114
Slide 21: Efficient Capital Management
Efficient Capital Management • The EGM called on October 28, 2008 to decide on Returning of Equity • Totally 35.7m; EUR 0.23 per share [shareholder’s equity per share from EUR 0.46 to EUR 0.23] • The Group has a goal to improve its current capital structure • As stated previously (e.g. annual report
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