(Unless otherwise stated comparisons are made to the same period
one year ago.)
Q4 Highlights
- Total revenue increased by 44% to a record level of
18.1m
- Anti-virus and intrusion prevention revenues increased by 52%
to a record level of 17.4m
- Corporate business increased by 20% to 8.9m
- Service provider business increased by 94% to 5.3m
- Consumer business increased by 137% to 3.2m
- EBIT 2.1m (1.6m)
- Deferred revenues increased by 3.3m to 23.2m; indicating
sales levels well above reported revenues
- Cash flow 2.4m positive
- Acquisition of Rommon Oy to strengthen the Group’s ISP
offering with network control solutions.
2005 Highlights
- Total revenue increased by 31% to a record level of
61.8m
- Anti-virus and intrusion prevention revenues increased by 44%
to a record level of 58.9m
- Corporate business increased by 16% to 32.5m
- Service provider business increased by 95% to 16.6m
- The Group doubled the number of ISP partners that was at the
end of the year 85 of which 12 in North America and 1 in
Asia
- Consumer business increased by 134% to 9.6m
- EBIT 7.4m (6.5m)
- Profit before tax 9.3m (7.7m)
- Deferred revenues increased by 4.8m to 23.2m
- Cash flow 12.1m positive
Business in 2005 at the Group level
2005 was another year of rapid and profitable growth for the
Group. The targets set and communicated to the market were met and
exceeded.
The key goal for 2005 was to grow the anti-virus and intrusion
prevention business faster than the industry’s overall growth. This
was clearly exceeded as the Group presented 44% growth. Growth of
the Group’s competitors declined towards the end of the year to
approximately 5% in the fourth quarter while the Group’s growth
actually increased to 52% in the antivirus business.
As stated at the beginning of the year, the Group’s position has
become stronger in the key European markets and in North America
especially in the ISP channel. The Group has gained a strong
position in the corporate market segment in Japan, and has now
entered the ISP segment in other parts of Asia.
Year 2005 became the breakthrough year for the Group’s Security
as a Service (SaaS) concept. Growth in the segment continued very
strong and total SaaS revenues, including the consumer, SMB and
Enterprise segments, represented almost one third of all anti-virus
and intrusion prevention revenues.
Retail in Europe and global web sales to consumers grew also
rapidly during 2005 due to great products and recruitment of new
channels.
The visibility and awareness in mobile security issues clearly
increased though the mobile business itself remained in the early
market stage.
The gradual exit from the encryption business continued steadily
and encryption revenues declined by 63%.
Total revenues were 61.8m (47.3m), representing 31% growth. EBIT
was 7.4m (6.5m). Cash flow was 12.1m positive (9.9m) and deferred
revenues were 23.2m at the end of the year (18.4m).
The Group’s variable costs were 5.9m (3.7m) and they increased
proportionally towards the end of the year due to the costs from
appliance hardware, consumer boxes and adjustments of paid
royalties. Though variable costs are increasing, Q4 variable costs
were at a higher than normal level due to the adjustments mentioned
above and gross margin is expected to improve from Q4 levels during
2006.
The total fixed costs were 49.4m (38m), representing 30% growth.
It is rewarding to note that during a year of heavy cost increase
in areas pertinent to long-term competitiveness, the Group was able
to achieve industry-leading growth while increasing sales at the
same, or slightly faster pace, than fixed costs.
The Group’s short-term strategy continues to be to prioritize
growth over profitability. Above all, investments into achieving a
strong sustainable position in the fast growing security service
provisioning market are seen as vital for the Group’s long-term
growth.
The cost increase during 2005 was due to new product development
especially related to products in the Service Platform concept and
the increase in sales resources in the field. The Group has
established and expanded sales offices in Europe and Asia.
The Group capitalizes some of its development expenses according
to the IFRS rules. This decreases costs by approximately 0.8m.
The geographical breakdown of the business was as follows:
Nordic Countries 36% (34%), Rest of Europe 45% (47%), North America
10% (10%) and Rest of the World 9% (9%). Anti-virus and intrusion
prevention represented 95% of the business (86%), encryption 4%
(13%) and other products and services less than 1% (1%).
According to the latest global survey made in the autumn of 2005
customer satisfaction has stabilized at very good levels. Overall
satisfaction was 4.27 (4.30) on a scale of 1 to 5. Relentless focus
on customer satisfaction is one of the Group’s core philosophies.
Reliability is core value and the one that is most visible to
customers and partners.
Business in different customer segments in Q4 and 2005
In the fourth quarter of 2005, revenues in the corporate
customer segment through resellers and IT services companies were
8.9m (7.4m), representing 51% of the anti-virus and intrusion
prevention business. Competitive solutions, a strong focus on
support and a renewed partner program has contributed to the growth
in this segment.
Growth in Q4 from this segment improved to 20% from levels close
to 15% during the previous quarters. During Q4 the Group introduced
F-Secure Messaging Security Gateway appliance that represents a
novel product “box” approach for the Group and that was positively
received in the market. Annual revenues in the corporate customer
segment increased by 16% and were 32.5m.
Growth in the corporate reseller channel remained above market
average. New reseller recruitment and continuous work with the
existing ones are equally important ongoing activities necessary to
maintain the momentum.
Revenues through the service provider channel in Q4 were 5.3m
(2.7m), representing 30% of the anti-virus and intrusion prevention
business and growth of 94% from the previous year. Security as a
Service has now broken through in the market. Service-like security
is the prime F-Secure way to deliver value to its customers. The
area was further reinforced through the development and
introduction of F-Secure Service Platforms and the acquisition of
Rommon Oy, as described below. The amount of service provider
partnerships doubled over the year. Annual revenues increased by
95% and were 16.6m.
Consumer revenues in Q4 were 3.2m (1.4m), representing 18% of
the anti-virus and intrusion prevention business. Revenue growth
rate continued strong, 137% from previous year. Sales were boosted
by a large number of new retail and reseller partners, positive
press visibility through review wins, increased web sales,
innovative new channels e.g. through on-line banking providers, and
the release of key new products alongside with the “All in One”
marketing campaign. Annual revenues increased by 134% and were
9.6m.
Mobile security is strategically a core area for the Group. The
interest in the Group’s solutions among phone vendors, mobile
operators and corporate customers remained at a high level. The
number of received RFPs/RFIs (Requests for Proposal or Information)
from operators increased heavily in Q4, showing continuously
increasing operator interest in this area. However, lead times have
remained long.
Antivirus and intrusion prevention market and competitive
situation
In the Consumer market, the growth is driven by an increasing
number of high-speed Internet connections and continuously growing
threat awareness. Based on various market analyses, the Group
estimates the overall market growth in this segment to be 25-30%
annually until 2008.
In the Small and Medium Business market annual market growth is
expected to be 10-15% until 2008. The large Enterprise segment is
over 95% satisfactorily protected and new business comes mostly
from replacements, either from switching vendors or buying security
as a service. As corporate software purchasing patterns evolve
towards a service model, the latter is expected to become a
significant new business opportunity for the Group in the coming
years. Competitive situation in the anti-virus and intrusion
prevention business has remained unaltered and price levels have
remained relatively stable. Some competitors have even been raising
their prices moderately. However, in some countries there have been
signs of increasing price competition. The Group has successfully
flanked these attacks through offering a premium product with
richer functionality and better service. Especially the Group’s
outstanding response times to virus outbreaks have received a lot
of positive attention.
There were no signs of Microsoft’s OneCare “PC health service”
taking any business away from the Group. Microsoft will enter the
consumer market with its OneCare solution around mid-2006.
Staying one step ahead both in product feature richness and
service channel development is the cornerstone of the Group’s
competitive positioning.
Security as a Service
Security as a Service is the F-Secure way to smoothly safeguard
the modern information society in every aspect, with the best
up-to-date knowledge.
The Group sees that there is an ongoing, fundamental change in
customers’ buying behaviour. Consumers and businesses will prefer
to purchase security as a subscription service over all other
alternatives. The Group has been a leader in supporting this change
with its Service Platform offering.
In 2005, the Group launched various F-Secure Service Platforms
that take into account the different business models and needs that
the different types of service providers have. There are different
platforms for target groups: Enterprises, Businesses, Consumers,
Gateways, Mobile Phones and Operator Networks.
With the launch, the Group aims to embrace all the different,
fast developing business models in security service provisioning.
The platforms cater for the needs and provide new business
opportunities for the Security Service Provider, the
business-focused Internet or IT service provider, the
consumer-focused ISP and the mobile operator.
During the year, the total number of announced ISP partners was
doubled to 85, out of which 12 are in North America and 1 in
Asia.
The Group is clearly the leading vendor in Europe with over 70
service providers in this category offering exclusively F-Secure
solutions to their customers. The ISP channel represents an easy
way to buy anti-virus and intrusion prevention for consumer
customers.
The Group has progressed well in creating solutions to provide
Security as a Service for the SMB and Enterprise segments. In these
segments, the partners are facilities management and outsourcing
companies and various types of service providers. During the year,
the Group has signed more partnerships with these types of
companies and revenues have increased clearly. The first operator
to launch Service Platform for Businesses was Finnet in Finland in
early Q1 2006.
Mobile security
The Group’s long-term pioneering investment to raise awareness
in mobile security issues was gradually yielding results during the
year.
Leading global mobile operators chose F-Secure as their
preferred partner in Mobile Security. These include T-Mobile
(Germany), TeliaSonera (Finland), Elisa (Finland) and Swisscom
(Switzerland). Orange Switzerland launched a pilot antivirus
service for mobile phone customers in Switzerland and
Liechtenstein.
In addition, the Group continued to receive an increasing number
of RFPs/RFIs from mobile operators.
The key vendor partner continued to be Nokia with whom the Group
works in various forms to create a secure mobile user experience.
F-Secure Mobile Anti-Virus will be available through Nokia to the
users of four recently announced devices based on S60 3rd Edition –
Nokia N71, Nokia E60, Nokia E61 and Nokia E70. For the Nokia N71,
F-Secure Mobile Anti-Virus will be distributed on the memory card
in the standard device sales package, while for the Nokia E-series
devices, the antivirus client will be available at Nokia Catalogs
service.
F-Secure Anti-Virus 2.0 for Windows Mobile was released at the
end of the year. It is available through standard and electronic
corporate and consumer channels.
Product Leadership
The Group has increased its R&D resources and restructured
its product portfolio in order to offer solutions to the service
provider partners and to offer new, more dynamic solutions for
businesses under increasing threat from online criminals and
malware authors.
F-Secure Anti-Virus Enterprise Suite extended the Group’s
existing product suite offering while F-Secure Anti-Virus Corporate
Suite replaced F-Secure Anti-Virus Total Suite. The Group also
offered a solution suite designed for smaller companies, the
F-Secure Small Business Suite. In March, the Group announced the
F-Secure BlackLight™ Rootkit Elimination Technology for Host based
Intrusion Prevention (HIPS). It is aimed against the use of
advanced stealth techniques called rootkits.
In June, the Group announced F-Secure Anti-Virus Client Security
6.0 that raises the bar for the whole industry. It is unique in
combining protection against spyware, adware, hackers, viruses,
worms, browser hijacking, code injections and zero-day attacks into
the same solution. The Group also announced F-Secure Policy Manager
6.0, a centralized management system for all the above mentioned
functionalities.
For corporate customers the Group released the F-Secure
Messaging Security Gateway, a security solution for e-mail
combining an enterprise-class messaging platform with perimeter
security, antispam, antivirus, secure messaging and outbound
content security capabilities in an easy-to-deploy appliance.
F-Secure Linux Client & Server Security 5.10 was a milestone
release bringing a comprehensive security package to this
increasingly important platform.
For consumers, the key product announcements of the year were
F-Secure Anti-Virus 2006 and F-Secure Internet Security 2006 that
is a comprehensive, “all in one” security solution. It includes
antivirus, integrated antispyware, rootkit detection, a personal
firewall, spam filtering and parental control.
The leading US IT magazine Infoworld tested various antispyware
products in its September 19 issue. F-Secure Client Security 6.0
was the only product ranked “excellent” with the highest points by
a wide margin.
F-Secure’s outstanding response times to major virus outbreaks
received wide publicity in BusinessWeek magazine in December.
The Acquisition of Rommon Oy
In November, The Group acquired Rommon Oy, a Finnish company
that provides network level malicious traffic control solutions for
ISPs.
The new combined offering, titled F-Secure Network Control, will
be targeted against network anomalies and network based attacks
that typically cause bandwidth disruption or Denial of Service
(DoS). The product provides visibility and control over network
behaviour and the ability to automatically place rogue network
nodes, such as contaminated virus-spreading home PCs, into
quarantine. The acquisition supports the Group’s strategy to
develop its Service Platform concept and its offering in the ISP
customer segment. In the future it will be developed for other
Service Platforms as well.
Personnel and Organization
The Group's personnel numbered 390 at the end of the year
(306).
The Group’s Executive Team consists of the following persons:
Risto Siilasmaa (President and CEO), Pekka Kuusela (Executive Vice
President, Sales and Marketing), Pirkka Palomäki (Executive Vice
President, Research and Development), Travis Witteveen (Executive
Vice President, Products and Services), Aki Mänttäri (Director,
Human Resources) and Taneli Virtanen (Chief Financial Officer).
Financing
The Group’s financial position remained strong throughout the
year. The Group’s equity ratio on December 31, 2005, was 81% (84%).
Financial income for 2005 was 1.9m (1.2m) including SRV accrual for
interest.
During 2005 cash flow was positive 12.1m(9.9m). The market value
of the liquid assets of the Group on December 31, 2005 was 61.8m
(50.1m).
The change in the USD-EUR exchange rate has had no effect on
either revenues or results.
Capital Expenditures
The Group’s capital expenditures for the year were 8.3m(2.9m).
These consisted mainly of IT hardware, software, capitalization of
development expenses and acquisition of Rommon Oy.
Shares, Shareholders' Equity, and Option Programs In 2005, the
following warrant subscriptions were made:
A total of 1,111,688 F-Secure shares were subscribed for with
the C warrants attached to the F-Secure 1998 Warrant Plan;
A total of 205,462 F-Secure shares were subscribed for with the
1999B, 1999C and 1999D warrants attached to the F-Secure 1999 I
Warrant Plan;
A total of 2,442,661 F-Secure shares were subscribed for with
the 1999D, 2001B, 2001C, 2001D, 2002A, 2002B, 2002C warrants
attached to the F-Secure 1999 II Warrant Plan;
A total of 466,701 F-Secure shares were subscribed for with the
1999D, 2001B, 2001D and 2002B warrants attached to the F-Secure
1999 III Warrant Plan;
A total of 150,850 F-Secure shares were subscribed for with the
A1/A2, B1/B2 warrants attached to the F-Secure 2002 Warrant
Plan;
As a result of all the above mentioned subscriptions, the number
of shares was increased by 4,410,362. The corresponding increase in
the share capital, in total EUR 44,103.62 was registered in the
Finnish Trade Register in six installments during the year.
F-Secure received as additional shareholders' equity a total of EUR
3,476,040.48
In December the Board of Directors of F-Secure Corporation,
based on the authorization given by the Annual General Meeting of
Shareholders on 23 March 2005, executed a share offering directed
to the shareholders of Rommon Oy as a partial payment of the
acquisition price according to the acquisition agreement. A total
of 791,806 F-Secure shares were subscribed for with price of ca EUR
1.89 per share. In aggregate the number of shares was increased by
791,806. The corresponding increase in the share capital, in total
EUR 7,918.06 was registered in the Finnish Trade Register on
December 2, 2005.
After the reporting period, a total of 53,150 F-Secure shares
were subscribed for with the A1/A2 warrants and a total of 7,250
F-Secure shares were subscribed for with the B1/B2 warrants
attached to the F-Secure 2002 Warrant Plan.
In aggregate the number of shares was increased by 60,400. The
corresponding increase in the share capital, in total EUR 604 was
registered in the Finnish Trade Register on January 9, 2006.
F-Secure received as additional shareholders' equity a total of EUR
38,415.
As a result of all the increases mentioned above, the share
capital of F-Secure is EUR 1,547,722.18 and the total number of
shares is 154,772,218. The corresponding number of shares fully
diluted would be 161,464,443 including all stock option
programs.
SRV Viitoset Oy
In September, by the decision of Helsinki District Court,
F-Secure was sentenced to pay the amount of EUR 793,230.53 and
litigation costs plus interest to SRV Viitoset Oy for the
additional construction and refurbishment work at the Group’s
headquarter premises.
F-Secure considers the work was already covered by the original
rental agreement and is appealing to change the verdict.
Even though the process is still open F-Secure decided to start
accruing the costs. Construction costs are periodized for the
duration of the rental period until the year 2010 starting
September 2005. The impact is roughly 0.1m per quarter.
IFRS Reporting
F-Secure publishes interim reports and annual financial
statement in accordance with the IFRS standards for 2005. The group
has published on February 15, 2005 its IFRS impacts and comparison
data for 2004.
Corporate Governance
F-Secure complies with the Corporate Governance recommendations
for public listed companies published in December 2003 by HEX Plc,
the Central Chamber of Commerce of Finland and the Confederation of
Finnish Industry and Employers as explained on company’s web
pages.
The dividend policy of F-Secure Corporation is to pay
approximately half of its annual profit as dividends. However, the
company may refrain from paying dividends to accrue funds to
finance other long term strategic investments; e.g.
acquisitions.
The Group's largest shareholder, Risto Siilasmaa, as a courtesy
to the stock market, wants to communicate the following indicative
intention: During the three week periods following the results
announcements during the calendar year 2006 he plans to sell a
number of F-Secure shares not exceeding 5% of the company's
outstanding shares. To improve liquidity and further develop the
ownership base the shares will be sold directly to large
institutional investors. The shares will be priced at market
levels, most likely based on volume-weighted average trading prices
of a number of days at the time of the transaction date.
Future Outlook
The Group’s three key goals in 2006 will follow the track
implemented during the recent years:
1) To continue focusing on long term competitiveness rather than
short term gain. This means that the Group intends to grow the
anti-virus and intrusion prevention business significantly faster
than the industry. The recent estimates for market growth vary
between 10-15% in the corporate segment and between 25-30% in the
consumer segment.
The prime vehicle for the Group’s future growth is Security as a
Service. This growth will also be pursued through systematically
growing various channels in the key European markets, an
increasingly comprehensive product offering, impeccable service and
a carefully increased geographical scope. The Group sees tangible
business opportunities in North America and Asia.
Key opportunities to be pursued in the consumer business are
new, innovative channel models, as was showcased in early 2006 with
an announcement with Barclays Internet Bank. On the corporate side,
extra leverage is expected to come from security appliances.
2) To continue capitalizing on the Group’s industry leadership
in Security as a Service, both with consumer and corporate end
customers.
Partnership recruitment will continue vigorously in all service
platform segments and the Group is well positioned to benefit from
the development of Security as a Service trend with a
comprehensive, leading product offering and an ever-stronger
position with service providers in Europe, North America and Asia.
F-Secure Network Control will present new opportunities in this
segment.
3) To advance in mobile security, and, as the market matures,
start turning leadership into revenues.
The visibility in mobile security business is improving
constantly through increased operator and corporate customer
awareness in mobile security issues and increased vendor interest.
The Group expects to see the number of mobile malware outbreaks
continue growing steadily. This will further underline the value of
an up-to-date security solution for handheld multimedia terminals
and will gradually escalate the uptake of mobile security
solutions.
The management estimates the strong growth in anti-virus and
intrusion prevention to continue, especially in Security as a
Service business. 2006 total revenues are expected to be around
85m, with an error margin of +-10%.
Based on its strategy to prioritize growth over short term
profitability, the Group continues to invest in new sales and
marketing activities as well as in major new development efforts
and new projects expanding the Group’s offering to service
providers and facilities management companies. The management is
aiming at an EBIT close to 20% in 2006. The latter half of 2006 is
expected to be the stronger half.
The estimation for Q106 revenues is 18.5m +-1m and cost level
around 15m. The estimate is based on the sales pipeline at the time
of publishing, existing subscriptions and support contracts,
previous experience on low purchasing activity at the beginning of
the year and a EUR/USD exchange rate of 1.20.
This interim report is prepared in accordance with IFRS
standards. The change in accounting standards has been reported on
15th February 2005.
Key figures (audited):
Euro million
INCOME STATEMENT 2005 2004 2005 2004 Chge
10-12 10-12 1-12 1-12 %
Revenues 18.1 12.6 61.8 47.3 31
Cost of revenues 2.1 1.0 5.9 3.7 58
Gross margin 16.0 11.6 55.9 43.5 28
Other operating income 0.2 0.3 0.8 0.9 -11
Sales and marketing 9.1 6.6 31.6 24.6 29
Research and development 4.2 3.0 14.7 10.7 36
Administration 0.8 0.8 3.1 2.7 16
Operating result 2.1 1.6 7.4 6.5 13
Financial net 1.2 0.4 1.9 1.2
Result before taxes 3.3 2.0 9.3 7.7
Income taxes -1.3 7.2 -2.7 5.8
Result for the period 2.0 9.2 6.6 13.5
Earnings per share, e 0.04 0.09
EPS, diluted, e 0.04 0.09
BALANCE SHEET
ASSETS 31/12/2005 31/12/2004
Non-current
Intangible assets 8.9 2.4
Tangible assets 3.0 1.7
Other financial assets 4.3 6.6
Current
Inventories 0.1
Other receivables 15.8 11.2
Available-for-sale
financial assets 53.5 42.4
Cash and bank accounts 8.5 7.8
Total 94.0 72.1
SHAREHOLDERS' EQUITY
AND LIABILITIES 31/12/2005 31/12/2004
Equity 57.1 45.2
Non-current liabilities
Other non-current 2.4 0.4
Deferred revenues 3.8 2.7
Current liabilities
Other current 11.3 8.1
Deferred revenues 19.4 15.7
Total 94.0 72.1
Cash flow statement 31/12/2005 31/12/2004
Cash flow from operations 14.4 11.7
Cash flow from investments -5.8 -2.8
Cash flow from financing
activities 3.5 1.0
Change in cash 12.1 9.9
Cash and bank at 1 Jan 50.2 39.6
Change in net fair value of
Available-for-sale -0.4 0.6
Cash and bank at 31 Dec 61.8 50.1
Statement of changes in shareholders’ equity
share
share premium transl. reval. retained
capital fund diff. reserve earnings total
Equity on
31.12.2004 1.5 28.6 0.0 0.5 14.7 45.2
Available-for-sale
financial asset, net -0.3 -0.3
Translation diff. 0.0 0.0
Cost of share
based payments 0.5 0.5
Profit 6.6 6.6
Exercise of options 0.0 4.9 5.0
Equity on
31.12.2005 1.5 33.5 0.0 0.2 21.8 57.1
Key ratios 2005 2004
12 m 12 m
Operating result,
% of revenues 11.9 13.8
ROI, % 19.0 21.3
ROE, % 12.9 35.9
Equity ratio, % 80.6 84.2
Debt-to-equity ratio, % -108.2 -110.7
Earnings per share (EUR) 0.04 0.09
Earnings per share diluted 0.04 0.09
Shareholders' equity
per share, e 0.37 0.30
P/E ratio 46.9 19.8
Capitalized expenditures (Me) 8.3 2.9
Contingent liabilities (Me) 12.7 14.6
Personnel, average 354 291
Personnel, Dec 31 390 306
Segment information
The Group has only one primary segment; data security.
Quarterly development
1/04 2/04 3/04 4/04 1/05 2/05 3/05 4/05
Revenues 10.4 11.6 12.8 12.6 13.3 14.7 15.7 18.1
Cost of revenues 0.8 1.0 1.0 1.0 1.3 1.3 1.2 2.1
Gross margin 9.6 10.6 11.8 11.6 12.0 13.4 14.5 16.0
Other operating income 0.2 0.2 0.2 0.3 0.2 0.3 0.2 0.2
Sales and marketing 6.0 6.0 5.9 6.6 7.4 7.7 7.4 9.1
Research and
development 2.4 2.6 2.7 3.0 3.2 3.6 3.7 4.2
Administration 0.7 0.6 0.6 0.8 0.8 0.8 0.6 0.8
Operating result 0.7 1.5 2.7 1.6 0.8 1.5 3.0 2.1
Financial net 0.4 0.1 0.3 0.4 0.5 0.3 -0.1 1.2
Result before taxes 1.0 1.7 3.0 2.0 1.2 1.8 2.9 3.3
The proposals of the Board to the Annual General Meeting
1) Dividend proposal
The result for the period of the parent company is
KEUR 6.254 and retained earnings is KEUR 12.557 that is totally
KEUR 18.811. The distributable shareholder’s equity in the Group is
totally KEUR 21.825.
The Board proposes to the Annual General Meeting that a dividend
of EUR 0.07 per share would be paid, a total of EUR 10,834,055.26
based upon the number of shares. The total dividend is about the
half of the profit from 2004 and 2005.
2) The authorization of Board of Directors to increase the
share capital of the company as follows:
a) The duration of the authorisation
The Board to be authorised during the period of one (1) year
from the date of the shareholders' meeting to decide on an increase
of the share capital of the company by one or more new share issues
or by launching one or more convertible bonds or option rights. As
a result of such share issues, option rights or convertible loans,
the share capital of the company may be increased by a maximum of
280,000 Euros. The maximum number of new shares to be issued is
28,000,000. To the extent the authorization is used to create
incentive systems for the personnel of the group, the share capital
may increase by a maximum of 70,000 EUR, in which case a maximum
amount of 7,000,000 shares may be issued.
b) Deviation from subscription rights
The shares, convertible bonds or option rights may be offered
to be subscribed by deviating from the subscription rights of the
shareholders. This deviation from the subscription rights is
proposed for the purpose that the company may fund its possible
acquisitions which are of strategic importance by way of share
arrangements, or strengthen its financing and capital structure, or
create incentive programs for Group’s employees.
c) The determination of the subscription price
The subscription price for the shares issued in the share
capital increase and converted or subscribed on the basis of
convertible bonds or option rights will be determined by the Board
of Directors. At minimum, the subscription or conversion price per
share is the counter book value of the share. To the extent the
authorization is used to create incentive systems for the personnel
of the Group, the subscription price will be determined by the
Board of Directors so that it is based on the market price of the
share.
d) Payment of the subscription price
The Board may accept as payment also a set-off or provision
of other assets (in-kind contributions).
e) Previous authorization
The proposal of the Board includes also that the unused
portion of the authorisation given by the Shareholders’ meeting on
the March 23, 2005, will be cancelled simultaneously with the
registration of the new authorization.
3) Draft of terms of Rommon merger
The Board proposes to the Annual General meeting to accept the
draft of terms of merger according to which fully owned subsidiary
Rommon Oy shall merge into F-Secure Corporation in order to achieve
cost savings. Financial Reporting
A press and analyst conference will be arranged today, February
14, at 11 am Finnish time at the Group’s Headquarters,
Tammasaarenkatu 7, Helsinki. A conference call for international
investors and analysts will be arranged at 1430 Finnish time (1330
CET, 12.30 pm UK time). Instructions can be found on our
investor
pages.
The 2005 Annual Report will be published on March 15. Annual
General Meeting will be held on March 22.
Quarterly reports for 2006 will be published on April 27 (Q1),
August 1 (Q2) and October 24(Q3). A Stock Exchange bulletin will be
sent at 9 am Finnish time to the Helsinki Exchanges, a press and
analyst conference will be arranged at 11 am Finnish time in
Helsinki, and an international conference call will be arranged in
the afternoon. Full details will be provided later on the Group's
web site.
F-Secure Corporation
Board of Directors
Additional information:
F-Secure Corporation
Risto Siilasmaa, President and CEO
tel. +358 9 2520 5510
Taneli Virtanen, CFO
tel. +358 9 2520 5655
