F-secure Oyj · OMXHEX:FSECURE
F-secure Oyj — Q1 2023 Earnings Presentation
31 slides from F-secure Oyj's earnings presentation, Jun 14, 2023
Slide 1: F-Secure Corporation Investor Presentation April-June 2023
t: F-Secure. F-Secure Corporation Investor Presentation April-June 2023
Slide 2: Q1: Strategy execution continues
Q1: Strategy execution continues Colored by challenging market environment Revenue growth of 1.6% — weak performance especially within new sales Market uncertainty continued, consumer sentiment weaker in the face of interest rate hikes and inflation - significant decline in device sales globally Bra
Slide 3: Progress in strategy execution in Q1/2023
Progress in strategy execution in Q1/2023 Increase average revenue per user (ARPU) Strategic focus: Accelerate the roll-out of F-Secure Total Progress , inQt: + Signed up 3 new partners for F- Secure Total 8 existing partners signed up for F-Secure Total upgrade New generation F-Secure Total launche
Slide 4: Short-term performance drivers
Short-term performance drivers • • • • • • • 4
Slide 5: Towards our strategic targets
Towards our strategic targets 2022 Independence Establish F-Secure as an agile and empowered organization Demerger completed June 30, 2022 Ramp-up of own business operations and building up capabilities as an independent company fF F-secure. 2023 Total Growth through Total and replacing stand-alone
Slide 6: Focus areas supporting growth
Focus areas supporting growth Brilliantly simple security experiences Expanding market reach 1 All-in-one security suite 4 New verticals "Covers all key digital moments * Banking, insurance, fintech and payments, and retail Network security 2. Protects households and people 5 Geographical expansion
Slide 7: Our purpose, vision and mission
Our purpose We exist to make every digital moment more secure, for everyone Our vision To become the #1 security experience company in the world Our mission Continuously deliver brilliantly simple, frictionless security experiences to our customers and partners 14-Jun-23 Restricted 7
Slide 8: Revenue by channel and geography
21% Partner channel Direct channel 79% 5% 15% 36% Nordic countries Rest of Europe North America Rest of World 44% 8
Slide 9: F-Secure portfolio
F-Secure portfolio Securing every digital moment. Simplified. Safe browsing & Ga Qe Family rules Banking protection iv) Malware protection ae “—~ Identity protection Privacy protection QB Smart home security Protection on the go Y Cyber Help A Strong passwords ? fF F-Secure 14un-23 Restricted
Slide 10: Use cases for premium security — peace of mind
Use cases for premium security — peace of mind Hi, Anna-Maria Why premium security solution vs.free All the protection you need in one package security Gg Covers all personal devices within all Internet security Everything is okay platforms Protection against viruses and No TASKS ransomware, safe on
Slide 11: Brand renewal: The New F-Secure
Brand renewal: The New F-Secure Vision to become the No1 security experience company in the world fF F-secure. Secure every Your life online, Everything digital This device is F-Secured digital moment F-Secured is protected One app to Your life online, All the protection secure every secured in one
Slide 12: Financials
Financials
Slide 13: Q1: Revenue up by 1.6%
Q1: Revenue up by 1.6% At comparable exchange rates, revenue increased by 1.2% Revenue by geography EURm Comparable 1 Change % growth% —! 27.8 +12.2% cu) SD Rest of world Q12022 @ Nordic countries Q12023 @RestofEurope mNorthAmerica fF F-secure. Partner Channel: revenue increased by 1.7% Sales increa
Slide 14: Deferred revenue, current and non-current
20.6 20.9 21.2 20.2 19.8 22.5 3.6 3.8 22.1 22.0 3.2 3.3 21.7 21.7 3.4 17.0 17.3 16.4 17.3 17.4 5.7 5.7 5.8 5.7 5.8 Current Non-current 24% 10% 66% * Deferred revenue breakdown is indicative
Slide 15: Excluding Items Affecting Comparability (IAC) and depreciation and amortization
• • * Excluding Items Affecting Comparability (IAC) and depreciation and amortization.
Slide 16: Transitional services agreements support independency
Transitional services agreements support independency * Inconnection with the demerger from WithSecure, F- Secure and WithSecure entered into transitional services agreements (‘TSA’) to support the continuous operations of F-Secure. + TSAcosts in cost of revenue are planned to terminate latest by th
Slide 17: 40.0 50.0% 90.0% 45.0% 35.0 40.0% 30.0 80.0% 25.2 4.9 25.7 25.9 25.3 14
40.0 20 50.0% 90.0% 18 45.0% 35.0 16 40.0% 30.0 80.0% 25.2 24.9 25.7 25.9 25.3 14 12.7 35.0% 25.0 12 11.4 30.0% 70.0% 10.1 10.2 9.8 20.0 10 25.0% 60.0% 15.0 8 20.0% 50.0% 6 15.0% 10.0 4 10.0% 5.0 40.0% 2 5.0% 0.0 30.0% 0 0.0% • • • • 17
Slide 18: Equity, deferred revenue and structuring loans
• 71.7 71.7 • Equity 18.8 • Deferred revenue Structuring loans 21.2 Lease liabilities Dividend liability 5.5 1.7 Other liabilities 12.2 12.2 2,023.00 18
Slide 19: Outlook 2023
Outlook 2023 On 26 April 2023, F-Secure announced the planned acquisition of Lookout Life. Subject to the completion of the acquisition, the transaction will have a financial impact on F-Secure. At this point, F-Secure will keep its 2023 outlook unchanged until the schedule for the completion of the
Slide 20: Updates to medium-term financial targets
Updates to medium-term financial targets Current medium-term financial targets (by 2025) Planned new medium-term financial targets (by 2026)” alll «High single-digit organic revenue growth ull * Totalrevenue of more than EUR 200 million Growth Growth by 2026 ~~ ~~ aN aN fe} fe} % % Br + Net debt/adj
Slide 21: F-Secure acquisition of mobile consumer security business unit of Lookout Inc.
F-Secure acquisition of mobile consumer security business unit of Lookout Inc. Creating the #1 consumer security experience company 26 April 2023
Slide 22: Compelling strategic and financial rationale
Compelling strategic and financial rationale Increasing size of F-Secure nearly 3x in the fast growing US market and strengthening position as the global leader in CSP channel Complementary mobile optimized product portfolio expanding consumer cyber security experience for tens of millions of subscr
Slide 23: Lookout Life at a glance
Lookout Life at a glance Leading consumer focused mobile security platform Device Security 2007 • Anti-virus & malware protection • Locate, scream and signal flare Founded • Passcode check and theft alert Identity Protection EUR 36m • 24/7 live restoration support • USD 1m theft insurance protection
Slide 24: Significantly strengthened market position in the US
Significantly strengthened market position in the US… Life Life Revenue mix by geography Revenue mix by geography1) Illustrative combined1) Rest of the world Europe Other Rest of the world Japan Nordic 5% 3% 6% 9% 0% countries Nordic Rest of Europe 27% countries 36% 34% 44% Rest of Europe 15% 88% 33
Slide 25: Largest consumer cyber security market growing faster than current key markets
…which is a major part of the largest consumer cyber security market growing faster than current key markets Global cyber security market (EURbn)1) Key attractions for F-Secure 22-26E CAGR 10.3 6.8% Americas grows ~2x faster than EMEA 1.6 9.5% 7.9 1.1 2.4 3.8% The US was the most targeted country 2.
Slide 26: Strong strategic alignment of go-to-market
Strong strategic alignment of go-to-market Life Life Revenue mix by channel Revenue mix by channel1) Illustrative combined1) Direct Direct Direct 21% 22% 21% 79% 78% 79% Partner Partner Partner Note: Lookout Life's unaudited financial information on carve-out basis (US GAAP) converted to EUR using t
Slide 27: Strengthening position as global leader in CSP channel
Strengthening position as the global leader in CSP channel with ~150 partners after the transaction Estimated share of contracts in communication service provider (CSP) channel Selected Lookout Life partner customers Illustrative 50% 40% 30% 20% 10% 0% The enlarged F-Secure will Life Others be even
Slide 28: Highly complementary consumer facing product portfolio
Highly complementary consumer facing product portfolio Desktop and mobile Pure-play mobile Life key complementary features key complementary features Overlapping PC & Mac Connected home VPN features Mobile finder & Wi-Fi connection iOS system protection protection antitheft monitoring protection Fam
Slide 29: Shared company culture with strong mobile product competence
Shared company culture with strong competence and experience developing mobile products Adding Lookout Life’s ~70 employees to Shared entrepreneurial Investments in know- Best-in-class F-Secure creates a cultures and vision of how and talent fueling mobile-first cyber global talent pool of the futur
Slide 30: Key terms of the transaction
Key terms of the transaction • Enterprise value of USD 223 million (approx. EUR 202 million1)) Purchase price – 15.7x EV/EBITA FY 01/2023 – 9.0x EV/EBITA FY 01/2023 including full impact of expected annual synergies by 20272) • Combined company to have illustrative combined revenue of EUR 147 millio
Slide 31: F-Secure
(: F-Secure