DIGIA PLC INTERIM REPORT, 5 August 2008 at 9:30 a.m.
Digia Plc's second quarter 2008 (IFRS)
Summary
January-June
- Consolidated net sales: EUR 64.8 million, up 24.2 per cent year on year
- Organic growth: 17.4 per cent
- Consolidated operating profit: EUR 8.0 million, up 49.1 per cent year on year
- Profitability (EBIT-%): 12.3 per cent (10.2 per cent 1-6/2007)
- Product business accounted for 14.0 per cent of net sales (17.5 per cent
1-6/2007)
- Earnings per share: EUR 0.23, up 76.9 per cent
April-June
- Consolidated net sales: EUR 33.1 million, up 27.9 per cent year on year
- Organic growth: 20.5 per cent
- Consolidated operating profit: EUR 3.7 million, up 51.5 per cent year on year
- Profitability (EBIT-%): 11.3 per cent (9.5 per cent 4-6/2007)
- Product business accounted for 14.9 per cent of net sales (17.3 per cent
4-6/2007)
- Earnings per share: EUR 0.11, up 83.3 per cent
- Digia's main targets for 2008 are to continue strong organic growth while
maintaining the profitability at a good level. The target takes into account the
holiday season's impact weakening the third quarter's consolidated net sales and
profitability. Digia estimates that the organic growth will continue to
outperform the market average during the second half of the year.
GROUP KEY FIGURES AND RATIOS
--------------------------------------------------------------------------------
| | 4-6/20 | 4-6/20 | Chang | 1-6/20 | 1-6/200 | Change | 2007 |
| | 08 | 07 | e, % | 08 | 7 | , % | |
--------------------------------------------------------------------------------
| Net sales | 33,133 | 25,903 | 28 % | 64,812 | 52,182 | 24 % | 105,83 |
| | | | | | | | 9 |
--------------------------------------------------------------------------------
| Operating | 3,739 | 2,468 | 51 % | 7,966 | 5,344 | 49 % | 11,080 |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| - % of net | 11 % | 10 % | | 12 % | 10 % | | 10 % |
| sales | | | | | | | |
--------------------------------------------------------------------------------
| Net profit | 2,286 | 1,269 | 80 % | 4,757 | 2,670 | 78 % | 5,871 |
--------------------------------------------------------------------------------
| - % of net | 7 % | 5 % | | 7 % | 5 % | | 6 % |
| sales | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Return on | 13 % | 8 % | | 14 % | 8 % | | 9 % |
| equity, % | | | | | | | |
--------------------------------------------------------------------------------
| Return on | 12 % | 9 % | | 13 % | 9 % | | 9 % |
| investment, % | | | | | | | |
--------------------------------------------------------------------------------
| Interest-bear | 56,623 | 56,416 | 0 % | 56,623 | 56,416 | 0 % | 56,413 |
| ing | | | | | | | |
| liabilities | | | | | | | |
--------------------------------------------------------------------------------
| Cash and cash | 15,942 | 12,843 | 24 % | 15,942 | 12,843 | 24 % | 11,739 |
| equivalents | | | | | | | |
--------------------------------------------------------------------------------
| Net gearing, | 58 % | 68 % | | 58 % | 68 % | | 65 % |
| % | | | | | | | |
--------------------------------------------------------------------------------
| Equity ratio, | 45 % | 44 % | | 45 % | 44 % | | 47 % |
| % | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.06 | 83 % | 0.23 | 0.13 | 77 % | 0.29 |
| share, EUR, | | | | | | | |
| undiluted | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.06 | 83 % | 0.23 | 0.13 | 77 % | 0.29 |
| share, EUR, | | | | | | | |
| diluted | | | | | | | |
--------------------------------------------------------------------------------
MARKETS AND DIGIA'S BUSINESS
As a whole, the first half of the year was excellent for Digia. During both the
first and second quarters the company succeeded extremely well in achieving its
key target of boosting the organic growth. Moreover, also second quarter's
operating profit improved markedly year on year.
While the market situation in the second quarter remained positive in Digia's
main business fields, the development of the world economy and its impact on
Digia's customers' investment propensity continues to create uncertainties.
Increased personnel costs continued to put strain on the company's profitability
in the second quarter and cost pressures will remain intense in the future.
Although employee turnover saw a slight decrease in the second quarter, it still
remains at a high level. However, Digia has succeeded well in its recruitments,
which is the key prerequisite for organic growth.
On 24 June 2008, Nokia, Sony Ericsson, Motorola and NTT DOCOMO announced their
intent to unite the Symbian OS operating system, S60, UIQ and MOAP(S) to create
one, open mobile software platform. According to Digia's estimates the announced
project will create new business opportunities to independent smartphone experts
such as Digia. Enabling more equipment manufacturers to develop smartphones on
the Symbian platform, the project offers Digia an opportunity to provide the
manufacturers with in-depth expertise.
Digia has implemented its internationalisation strategy in a controlled and
determined manner. Establishing a Digia unit in China is well underway, with the
first customer projects commencing in the third quarter. The Swedish and Russian
business activities have also reported expected successes.
Telecommunications
During the reporting period, the division's customer relationships developed
favourably and it enjoyed a high level of customer satisfaction, while making
efficient use of production capacity. During the second quarter, demand
temporarily weakened slightly but is still stronger than in the corresponding
period in the previous year.
The division has also further strengthened its delivery capacity by continuing
to pursue its active recruitment policy initiated in the previous financial
year. Recruitment is mainly focused in countries with lower cost levels.
In April, Digia opened a development unit in Chengdu, China. China offers very
favourable and strongly developing conditions for software development
activities, for instance from educational and infrastructure perspectives.
Chengdu is an especially rapidly developing area and many of Digia's customers
and partners have also located their operations in the Chengdu area. The launch
of operations in Chengdu will incur expenses during 2008 which have been taken
into account in targets and estimates for the company's financial development.
The release of the Symbian operating system to Open Source will in long term
create interesting development opportunities for Digia's business.
Finance and Services
Finance and Services increased its business during the second quarter, while its
profitability decreased year on year. This was caused by projects closing and
delays in the initiation of new major projects replacing them, as well as a
provision made for a fixed-price project. The division's invoicing rates saw an
improvement towards the end of the reporting period.
Demand in the public sector has remained healthy. In spite of the general
uncertainty prevailing in the finance sector, demand for the Finance division
remained relatively good.
Industry and Trade
Digia's ERP business launched a development project, targeted for the trade
sector and in particular for speciality goods industry, and has concluded new
delivery agreements with wholesale and industry customers. Expanding the ERP
supply in the public sector has also shown expected progress. In June, Digia
concluded an agreement with Medbit Oy, a provider for Varsinais-Suomi and
Satakunta Hospital Districts, on the delivery of an integrated system for
materials and purchasing.
For integration solutions, growth of net sales and profitability continued
positively. For its key customers, the company has expanded its operations which
now involve business process modelling, service-oriented architecture and
technical integration services. Investments made on sales are anticipated to
have a positive effect in the creation of new customer relationships.
New customers won for eBusiness solutions have enabled the attainment of
expected growth.
While second quarter market demand in Trade and Industry was satisfactory,
global economic trends are generating uncertainties for the autumn, which could
be reflected on the ERP market.
RISKS AND UNCERTAINTIES
Digia's short-term uncertainties are related to any major changes occurring in
the company's core markets, the availability and cost of skilled personnel,
employee turnover and the impact of the unpredictable economic situation to
Digia customers' investment decisions. Furthermore, the growth in customer
project size and scope increases risks related to projects and their
profitability. A more detailed description of Digia's risk management is
provided in its annual report and on the company website.
PROSPECTS FOR 2008 AND COMPANY OBJECTIVES
Digia's main targets for 2008 are to continue strong organic growth while
maintaining the profitability at a good level. The target takes into account the
holiday season's impact weakening the third quarter's consolidated net sales and
profitability. Digia estimates that its organic growth will continue to
outperform the market average during the second half of the year.
The company's management focuses on customers, personnel and further
internationalisation of operations. The key short-term targets include organic
growth, expanding the company's service offerings, deepening customer
relationships and enhancing employee satisfaction. Furthermore, Digia will
continue to increase its operational efficiency while pursuing a strict cost
policy.
In the long-term Digia seeks primarily to concentrate on strengthening organic
growth. Digia renounced its revolving credit facility, announced on
9 November 2006, meant for financing possible acquisitions. By renouncing the
credit facility, the company will save over EUR 100,000 annually. While the
company is still able to execute strategically important acquisitions, reaching
the revenue target of EUR 200 million for 2010 as announced earlier is not
company's main focus. Instead, the company now focuses on organic growth of the
businesses by developing current competencies and products, with an aim to
improve profitability, earnings per share and the balance sheet figures.
In order to enhance its operations, Digia has initiated an organisational reform
project which will lead to the integration of the company's sales, product and
service range and competencies. The Group's sales and marketing is headed by
Antti Lastunen, who took up his duties at Digia on 16 June 2008, leaving SAP
Finland Ltd. Mr. Lastunen is also appointed as a member of Digia's Management
Group. The company's product and service range and its development including
competencies are, similarly, managed in a centralised manner. Digia expects to
complete the necessary preparations for the reorganisation by the end of
September. The organisational reform aims to further enhance the use of the
company's resources, increase the invoicing rate and, thus, improve
profitability.
NET SALES
Digia's consolidated net sales for the period 1-6/2008 were EUR 64.8 million, up
by 24.2 per cent year on year (1-6/2007: EUR 52.2 million). This includes
EUR 3.0 million of net sales of Sunrise Resources Ltd, a subsidiary acquired on
14 January 2008 and Capital C AB, a subsidiary acquired on 31 August 2007.
Net sales posted by Telecommunications for the period were EUR 32.4 million, up
by 36.2 per cent (1-6/2007: EUR 23.8 million) while net sales by Finance and
Services totalled EUR 17.2 million for the period, up by 26.7 per cent
(1-6/2007: EUR 13.6 million). Industry and Trade recorded net sales of EUR 15.2
million for the period, up by 2.6 per cent (1-6/2007: EUR 14.8 million).
During the reporting period, the product business accounted for EUR 9.1 million
(1-6/2007: EUR 9.1 million) of consolidated net sales, or 14.0 per cent
(1-6/2007: 17.5 per cent).
International operations accounted for 13.2 per cent of consolidated net sales
(1-6/2007: 9.1 per cent).
For the second quarter, Digia's consolidated net sales amounted to
EUR 33.1 million, up by 27.9 per cent (4-6/2007: EUR 25.9 million). This
includes EUR 1.4 million of net sales of Sunrise Resources Ltd, a subsidiary
acquired on 14 January 2008 and Capital C AB, a subsidiary acquired on 31 August
2007.
Net sales by Telecommunications for the second quarter were EUR 16.5 million, up
by 37.3 per cent year on year (4-6/2007: EUR 12.0 million). Finance and Services
reported net sales of EUR 8.6 million, up by 28.3 per cent (4-6/2007:
EUR 6.7 million). Industry and Trade recorded net sales of EUR 8.0 million, up
by 11.7 per cent (4-6/2007: EUR 7.2 million).
During the second quarter, the product business accounted for EUR 4.9 million
(4-6/2007: EUR 4.5 million) of consolidated net sales, or 14.9 per cent
(4-6/2007: 17.3 per cent).
International business accounted for 11.9 per cent of consolidated net sales in
the second quarter (4-6/2007: 9.2 per cent).
PROFIT PERFORMANCE AND PROFITABILITY
Digia's consolidated operating profit (EBIT) for the reporting period amounted
to EUR 8.0 million, up 49.1 per cent on a year earlier (1-6/2007: EUR 5.3
million). This includes EUR 0.3 million of net sales of Sunrise Resources Ltd
and Capital C AB. Profitability (EBIT-%) was 12.3 per cent (1-6/2007: 10.2 per
cent).
Telecommunications reported an operating profit of EUR 5.6 million for the
period, representing a year on year growth of 95.5 per cent (1-6/2007: EUR 2.9
million), and profitability (EBIT-%) was 17.3 per cent (1-6/2007: 12.1
per cent). Finance and Services recorded an operating profit of EUR 0.7 million,
showing an increase of 37.8 per cent (1-6/2007: EUR 0.5 million) and
profitability was 4.1 per cent (1-6/2007: 3.8 per cent). Industry and Trade
posted an operating profit of EUR 1.6 million, representing a year-on-year
decrease of 16.5 per cent (1-6/2007: EUR 2.0 million) and profitability (EBIT-%)
was 10.8 per cent (1-6/2007: 13.2 per cent).
During the second quarter, Digia's consolidated operating profit (EBIT) amounted
to EUR 3.7 million, representing growth of 51.5 per cent on a year earlier
(4-6/2007: EUR 2.5 million). This includes EUR 0.1 million of net sales of
Sunrise Resources Ltd and Capital C AB. Profitability (EBIT-%) was 11.3 per cent
(4-6/2007: 9.5 per cent).
Telecommunications reported an operating profit of EUR 2.5 million for the
second quarter, representing a year on year growth of 76.1 per cent (4-6/2007:
EUR 1.4 million), and profitability (EBIT-%) was 15.3 per cent (4-6/2007:
12.0 per cent). Finance and Services recorded an operating profit of
EUR 0.1 million, showing a decrease of 60.1 per cent (4-6/2007: EUR 0.4 million)
and profitability was 1.7 per cent (4-6/2007: 5.5 per cent). Industry and Trade
posted an operating profit of EUR 1.1 million, representing a year on year
increase of 60.2 per cent (4-6/2007: EUR 0.7 million) and profitability (EBIT-%)
was 13.3 per cent (4-6/2007: 9.2 per cent).
The Group's reported earnings before tax stood at EUR 6.4 million for the
period, representing growth of 68.8 per cent (1-6/2007: EUR 3.8 million), and
net profit totalled EUR 4.8 million, up by 78.2 per cent (1-6/2007: EUR 2.7
million).
Earnings per share for the period were EUR 0.23, representing a year on year
increase of 76.9 per cent (1-6/2007: EUR 0.13). Earnings per share in the second
quarter were EUR 0.11 (4-6/2007: EUR 0.06).
The Group's net financial expenses for the reported period totalled EUR 1.5
million (1-6/2007: EUR 1.5 million).
FINANCIAL POSITION AND CAPITAL EXPENDITURE
On 30 June 2008, Digia's consolidated balance sheet total stood at
EUR 157.9 million (12/2007: EUR 149.6 million) and equity ratio was 45.0 per
cent (12/2007: 46.5 per cent). Net gearing stood at 58.3 per cent (12/2007:
65.1 per cent). The period-end cash and cash equivalents totalled EUR 15.9
million (12/2007: EUR 11.7 million), and interest-bearing liabilities amounted
to EUR 56.6 million (12/2007: EUR 56.4 million).
The Group carries out annual impairment tests for goodwill and intangible assets
with an indefinite useful life in accordance with the IAS 36 standard.
The table below shows goodwill and values subject to testing, by business
segment, at the end of the reporting period:
--------------------------------------------------------------------------------
| EUR 1,000 | Specifie | Depreciat | Goodwill | Other | Total value |
| | d | ion | | items | subject to |
| | intangib | during | | | testing |
| | le | the | | | |
| | assets | reporting | | | |
| | | period | | | |
--------------------------------------------------------------------------------
| Telecommunicatio | 8,187 | 606 | 49,546 | 5,566 | 63,299 |
| ns | | | | | |
--------------------------------------------------------------------------------
| Finance and | 2,015 | 152 | 13,692 | 2,790 | 18,498 |
| Services | | | | | |
--------------------------------------------------------------------------------
| Industry and | 3,193 | 292 | 26,410 | 2,465 | 32,069 |
| Trade | | | | | |
--------------------------------------------------------------------------------
| Group total | 13,395 | 1,050 | 89,649 | 10,822 | 113,866 |
--------------------------------------------------------------------------------
Present values are determined on the basis of actual operating profit and
five-year forecasts by the CGU, with growth varying between three and five per
cent and the operating margin between 10 and 12 per cent.
Cash flows following the forecast period are estimated by extrapolating the cash
flows using a steady net sales growth forecast of three per cent, with operating
profit estimated at 10 per cent of net sales. Discount rates have been
determined in view of the industry's general risk level, corresponding to an
annual interest rate of 11 per cent.
Net sales growth is reckoned to constitute the most critical factor in
calculating the present values of cash flows. The amount of goodwill for
Telecommunications requires average annual long-term growth of around two per
cent in its net sales and an operating margin of 10 per cent before amortisation
of intangible assets. The amount of goodwill for Finance and Services requires
average annual growth of two per cent for business operations and six per cent
profitability before amortisation of intangible assets. The amount of goodwill
for Industry and Trade requires average annual long-term growth of two per cent
in its net sales and an operating margin of nine per cent before amortisation of
intangible assets.
Based on a reasonable estimate, any change in key variables used in calculations
during the reporting period would not lead to a situation in which the segment's
carrying amount would exceed its recoverable amount. Consequently, in the
management's view, there is no need to recognise impairment losses.
The Group's cash flow from business operations for the period was positive by
EUR 11.1 million (1-6/2007: positive cash flow of EUR 4.3 million), cash flow
from investments was negative by EUR 4.1 million (1-6/2007: negative EUR 1.2
million) and cash flow from finance was negative by EUR 2.9 million (1-6/2007:
negative EUR 1.8 million). Cash flow from investments was negatively influenced
by the acquisition of Sunrise Resources Ltd, with a negative effect of EUR 2.8
million. Cash flow from finance was negatively affected by the acquisition of
own shares, with a negative effect of EUR 0.8 million, and payment of dividends,
with a negative effect of EUR 2.0 million.
Gross capital expenditure during the period totalled EUR 1.3 million (1-6/2007:
EUR 1.0 million). Acquisitions of tangible fixed assets totalled EUR 1.0 million
(1-6/2007: EUR 0.6 million).
Return on investment (ROI) for the period stood at 13.1 per cent (12/2007:
9.4 per cent) and return on equity (ROE) was 13.8 per cent (12/2007:
8.9 per cent).
HUMAN RESOURCES, MANAGEMENT AND ADMINISTRATION
On 30 June 2008, the number of Group employees totalled 1,335, up by
180 individuals or 15.6 per cent, from the staff number on 31 December 2007
(2007: 1,155). During the reporting period, the number of employees averaged
1,284, showing an increase of 168 individuals or 15.1 per cent, (2007: 1,116)
over the same period a year earlier.
Employees by function at the end of the period:
--------------------------------------------------------------------------------
| Telecommunications | 54 % |
--------------------------------------------------------------------------------
| Finance and Services | 23 % |
--------------------------------------------------------------------------------
| Industry and Trade | 19 % |
--------------------------------------------------------------------------------
| Administration and Management | 4 % |
--------------------------------------------------------------------------------
As of 30 June 2008, altogether 91 staff were working abroad (2007: 26).
The Annual General Meeting (AGM) of 11 March 2008 elected the following Board
members: Pekka Sivonen, Pertti Kyttälä, Kari Karvinen, Harri Koponen and Martti
Mehtälä. At the Board's organising meeting, Pekka Sivonen was elected as
full-time Chairman of the Board, responsible for the duties referred to in the
Finnish Companies Act and, additionally, operational duties, on the terms and
conditions specified in a separate service contract concluded between the
company and Sivonen, in the areas including group strategy planning, strategic
partnerships, equity markets and communications. From the beginning of April
2008 until the end of August, Sivonen is functioning as a part-time Chairman of
the Board and, during this period, the above-mentioned operational duties are
under the responsibility of the CEO. Board member Harri Koponen has on August
4th requested resignation from Digia's Board work because he was nominated as
the CEO of Tele2 operator.
As of 1 January 2008, Digia's President and CEO is Juha Varelius.
Ernst & Young Oy, a firm of authorised public accountants, is the Group's
auditor, with Heikki Ilkka, Authorised Public Accountant, as the chief auditor.
Transactions with related parties
Digia Group's related parties include the CEO and the members of the Board of
Directors and the Group Management Team. The Group had no significant
transactions with related parties during the reporting period.
GROUP STRUCTURE AND ORGANISATION
On 30 June 2008, Digia Group consisted of Digia Plc, the parent company; and
active subsidiaries Digia Finland Ltd (parent company holding 100 %); Capital C
AB (100 %) operating in Sweden; and Digia Estonia Oü (100 %) operating in
Estonia; as well as Sunrise Resources Oy, which has an active subsidiary, OOO
Sunrise-r Spb (100 %), in Russia. In addition, Digia Finland Ltd has the
wholly-owned active subsidiaries Digia Service Ltd (100 %) and Digia Financial
Software Ltd (100 %). Digia Service Ltd is intended to be merged with Digia
Finland Ltd during 2009.
SHAREHOLDERS' MEETINGS
Annual General Meeting on 11 March 2008
Convening on 11 March 2008, Digia Plc's Annual General Meeting (AGM) adopted the
financial statement for 2007, discharged Board members and the CEO from
liability and, as proposed by the Board of Directors, approved the profit
distribution for 2007, determined Board emoluments and elected the company's
Board of Directors for a new term. In addition, the AGM decided to change the
company name to Digia Plc and selected a new auditor for the company. The AGM
granted the Board the following authorisations:
Authorising the Board of Directors to decide on a share issue and granting of
special rights
The AGM authorised the Board of Directors to decide on a rights issue or a
capitalisation issue and on granting option rights and other special rights on
the following terms:
- The authorisation can be exercised, for instance, for the development of the
company's capital structure, for exercising the share based incentive systems or
for enabling and financing company and business acquisitions and other
co-operation, or other such restructuring;
- The Board of Directors is entitled to decide to issue new shares or existing
shares in the company's possession in one or more sets provided that the maximum
total number of shares issued is 4,000,000;
- The Board of Directors is also entitled to decide to sell the company's own
shares in the public trading on OMX Nordic Exchange Helsinki in order to finance
possible business acquisitions;
- The Board of Directors is otherwise authorised to decide on other terms of
share issue including the right to decide on a private placement or granting
special rights on a private placement basis;
- The authorisation replaces the authorisation granted by the AGM of
28 February 2007, and will be valid for 18 months from the issue date of the
authorisation, or until 11 September 2009.
Authorisation of the Board of Directors to decide on the buyback of own shares
The AGM authorised the Board of Directors to decide on the buyback of own shares
with the following terms:
- Own shares can be bought back, for instance, for the purpose of strengthening
the company's capital structure, for exercising the share based incentive
systems or for enabling and financing company and business acquisitions and
other co-operation, or other such restructuring or for the purpose of being
invalidated;
- The shares may be bought back in one or more sets, provided that the maximum
number of shares involved is 2,000,000;
- Own shares shall not be bought back in proportion to the shareholders'
holdings but in public trading organised by the OMX Nordic Exchange Helsinki;
- The shares shall be bought back for the price determined by the Board of
Directors, based on the fair value quoted in public trading on the buyback date;
- The shares may be acquired with free shareholders' equity and the acquisition
of shares will decrease the free shareholders' equity and distributable assets;
- The Board of Directors is otherwise authorised to decide on other terms of
buyback of own shares; and
- The authorisation replaces the authorisation granted by the AGM of
28 February 2007, and will be valid for 18 months from the issue date of the
authorisation, or until 11 September 2009.
The Board of Directors decided in its meeting after the AGM of 11 March 2008 to
continue the buyback of own shares in accordance with the terms of the General
Meeting's authorisation and the terms published on 13 February 2008.
SHARE CAPITAL AND SHARES
On 30 June 2008, the number of Digia shares was 20,853,645.
According to Finnish Central Securities Depository Ltd, on 30 June 2008 Digia
had 3,251 shareholders. The ten major shareholders were:
--------------------------------------------------------------------------------
| Shareholder | Proportion (%) of shares and |
| | votes |
--------------------------------------------------------------------------------
| Pekka Sivonen | 24.4 % |
--------------------------------------------------------------------------------
| Kari Karvinen | 7.6 % |
--------------------------------------------------------------------------------
| Matti Savolainen | 6.3 % |
--------------------------------------------------------------------------------
| OP-Suomi Pienyhtiöt mutual fund | 3.6 % |
--------------------------------------------------------------------------------
| Varma Mutual Pension Insurance Company | 3.6 % |
--------------------------------------------------------------------------------
| Nordea Bank Finland Plc / Nominee-registered | 3.6 % |
--------------------------------------------------------------------------------
| Veikko Laine Oy | 2.8 % |
--------------------------------------------------------------------------------
| Nordea Bank Finland Plc | 2.4 % |
--------------------------------------------------------------------------------
| Jorma Kylätie's estate | 2.2 % |
--------------------------------------------------------------------------------
| Evli Bank Plc | 1.6 % |
--------------------------------------------------------------------------------
Distribution of holdings by number of shares held on 30 June 2008:
--------------------------------------------------------------------------------
| Number of shares | Proportion (%) of | Proportion (%) of |
| | holdings | shares and votes |
--------------------------------------------------------------------------------
| 1 - 100 | 21.7 % | 0.3 % |
--------------------------------------------------------------------------------
| 101 - 1,000 | 51.3 % | 3.8 % |
--------------------------------------------------------------------------------
| 1,001 - 10,000 | 23.4 % | 10.6 % |
--------------------------------------------------------------------------------
| 10,001 - 100,000 | 2.8 % | 12.7 % |
--------------------------------------------------------------------------------
| 100,001 - 1,000,000 | 0.7 % | 34.3 % |
--------------------------------------------------------------------------------
| 1,000,001 - 3,000,000 | 0.1 % | 38.3 % |
--------------------------------------------------------------------------------
Shareholding by sector on 30 June 2008
--------------------------------------------------------------------------------
| | Proportion (%) of | Proportion (%) of |
| | holdings | shares |
--------------------------------------------------------------------------------
| Companies | 6.2 % | 12.1 % |
--------------------------------------------------------------------------------
| Financial institutions and | 0.5 % | 15.0 % |
| insurance companies | | |
--------------------------------------------------------------------------------
| Non-corporate public sector | 0.1 % | 3.8 % |
--------------------------------------------------------------------------------
| Non-profit organisations | 0.4 % | 0.4 % |
--------------------------------------------------------------------------------
| Households | 92.3 % | 67.3 % |
--------------------------------------------------------------------------------
| Foreign holding | 0.5 % | 1.4 % |
--------------------------------------------------------------------------------
REPORTED SHARE PERFORMANCE ON THE HELSINKI STOCK EXCHANGE
Digia Plc shares are listed on the Nordic Exchange under Information Technology
IT Services. The company's short name is DIG1V. The lowest reported share
quotation was EUR 2.55 and the highest was EUR 3.30. The share closed at EUR
2.96 on the period's last trading day. The trade-weighted average amounted to
EUR 3.04. The Group's market capitalisation totalled EUR 61,726,789 at the end
of the period.
During the reporting period, the company did not receive new announcements based
on the Finnish Securities Markets Act.
STOCK OPTION SCHEMES
The current option schemes of Digia include the stock option scheme 2003D, on
the basis of which a maximum number of 150,000 shares in Digia can be
subscribed, and stock option scheme 2005A-C, on the basis of which a maximum
number of 900,000 shares in Digia can be subscribed.
On 30 June 2008, the remaining number of warrants issued by Digia totalled
1,050,000. Shares subscribed for using the warrants represent a maximum of
4.79 per cent of the company's share capital and voting rights after any
potential increase in share capital. On 30 June 2008, the number of warrants
still held by Digia totalled 534,082 of all valid warrants. On 30 June 2008, the
maximum dilution effect of the issued warrants was 2.41 per cent.
Helsinki, 5 August 2008
Digia Plc
Board of Directors
BRIEFING FOR MEDIA AND ANALYSTS
Digia will hold a briefing on its Interim Report for Q2/2008 and financial
statement for analysts and the media on Tuesday 5 August 2008 at 11.00 a.m. in
the Marski Cabinet of the World Trade Center, Aleksanterinkatu 17, Helsinki,
Finland. All are welcome.
FURTHER INFORMATION
Juha Varelius, President and CEO
Mobile: +358 400 855849, e-mail: juha.varelius@digia.com
The Interim Report and access to the related live briefing for the media and
analysts (in Finnish) will be available in the ‘Investors' section at
www.digia.com. The briefing starts at 11.00 a.m.
DISTRIBUTION
OMX Nordic Exchange Helsinki
Key media
ATTACHMENTS
Consolidated income statement
Consolidated balance sheet
Consolidated cash flow statement
Consolidated statement of changes in shareholders' equity
Notes to the accounts
The Interim Report has been prepared in compliance with IFRS and standard IAS
34. This Interim Report is based on unaudited figures.
CONSOLIDATED INCOME STATEMENT, EUR 1,000
--------------------------------------------------------------------------------
| | 4-6/2 | 4-6/2 | Chang | 1-6/20 | 1-6/200 | Change | 2007 |
| | 008 | 007 | e, % | 08 | 7 | , % | |
--------------------------------------------------------------------------------
| Net sales | 33,13 | 25,90 | 28 % | 64,811 | 52,182. | 24 % | 105,839 |
| | 3.1 | 3.1 | | .6 | 0 | | .4 |
--------------------------------------------------------------------------------
| Other | 4.0 | 80.3 | -95 % | 9.3 | 203.7 | -95 % | 211.6 |
| operating | | | | | | | |
| income | | | | | | | |
--------------------------------------------------------------------------------
| Materials and | -3,27 | -1,75 | 86 % | -6,093 | -3,678. | 66 % | -8,363. |
| services | 1.2 | 5.9 | | .7 | 2 | | 5 |
--------------------------------------------------------------------------------
| Depreciation | -1,15 | -1,15 | 0 % | -2,436 | -2,429. | 0 % | -4,893. |
| and impairment | 9.4 | 9.6 | | .2 | 7 | | 5 |
--------------------------------------------------------------------------------
| Other | -24,9 | -20,5 | 21 % | -48,32 | -40,933 | 18 % | -81,713 |
| operating | 67.9 | 99.8 | | 4.8 | .6 | | .9 |
| expenses | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Operating | 3,738 | 2,468 | 51 % | 7,966. | 5,344.3 | 49 % | 11,080. |
| profit | .6 | .0 | | 2 | | | 1 |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Financial | -721. | -733. | -2 % | -1,518 | -1,524. | 0 % | -3,182. |
| expenses (net) | 4 | 8 | | .5 | 2 | | 5 |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Pre-tax profit | 3,017 | 1,734 | 74 % | 6,447. | 3,820.1 | 69 % | 7,897.6 |
| | .2 | .3 | | 7 | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Direct tax | -731. | -465. | 57 % | -1,690 | -1,149. | 47 % | -2,026. |
| | 6 | 8 | | .2 | 9 | | 4 |
--------------------------------------------------------------------------------
| Net profit | 2,285 | 1,268 | 80 % | 4,757. | 2,670.2 | 78 % | 5,871.2 |
| | .6 | .6 | | 5 | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Allocation: | | | | | | | |
--------------------------------------------------------------------------------
| Parent company | 2,285 | 1,268 | 80 % | 4,757. | 2,670.2 | 78 % | 5,871.2 |
| shareholders | .6 | .6 | | 5 | | | |
--------------------------------------------------------------------------------
| Minority | 0.0 | 0.0 | | 0.0 | 0.0 | | 0.0 |
| shareholders | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.06 | 83 % | 0.23 | 0.13 | 77 % | 0.29 |
| share, EUR | | | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.06 | 83 % | 0.23 | 0.13 | 77 % | 0.29 |
| share, EUR, | | | | | | | |
| diluted | | | | | | | |
--------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET, EUR 1,000
--------------------------------------------------------------------------------
| Assets | 30 June 2008 | 31 Dec. 2007 | Change, % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Fixed and other | | | |
| non-current assets | | | |
--------------------------------------------------------------------------------
| Intangible assets | 104,570.4 | 102,107.6 | 2 % |
--------------------------------------------------------------------------------
| Tangible assets | 2,989.5 | 2,935.5 | 2 % |
--------------------------------------------------------------------------------
| Financial assets | 655.4 | 660.3 | -1 % |
--------------------------------------------------------------------------------
| Deferred tax assets | 2,022.3 | 2,312.0 | -13 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Total fixed and other | 110,237.5 | 108,015.4 | 2 % |
| non-current assets | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Current assets | | | |
--------------------------------------------------------------------------------
| Current receivables | 31,713.9 | 29,889.0 | 6 % |
--------------------------------------------------------------------------------
| Available-for-sale | 5,203.0 | 5,180.4 | 0 % |
| financial assets | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 10,738.8 | 6,558.4 | 64 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Total current assets | 47,655.7 | 41,627.8 | 14 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Total assets | 157,893.2 | 149,643.2 | 6 % |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shareholders' equity and | 30 June 2008 | 31 Dec. 2007 | Change, % |
| liabilities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Share capital | 2,085.4 | 2,085.4 | 0 % |
--------------------------------------------------------------------------------
| Issue premium fund | 7,899.5 | 7,892.5 | 0 % |
--------------------------------------------------------------------------------
| Other reserves | 5,203.8 | 5,203.8 | 0 % |
--------------------------------------------------------------------------------
| Unrestricted invested | 35,069.1 | 38,110.6 | -8 % |
| shareholders' equity | | | |
--------------------------------------------------------------------------------
| Translation difference | -11.6 | -11.8 | -2 % |
--------------------------------------------------------------------------------
| Retained earnings/loss | 14,801.9 | 9,450.3 | 57 % |
--------------------------------------------------------------------------------
| Net profit | 4,757.5 | 5,871.2 | -19 % |
--------------------------------------------------------------------------------
| Equity attributable to | 69,805.7 | 68,602.0 | 2 % |
| parent company | | | |
| shareholders | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.0 | 0.0 | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Total shareholders' equity | 69,805.7 | 68,602.0 | 2 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Liabilities | | | |
--------------------------------------------------------------------------------
| Long-term, | 55,794.5 | 55,646.7 | 0 % |
| interest-bearing | | | |
| liabilities | | | |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 3,406.2 | 3,442.4 | -1 % |
--------------------------------------------------------------------------------
| Total long-term | 59,200.6 | 59,089.1 | 0 % |
| liabilities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Current interest-bearing | 828.7 | 766.3 | 8 % |
| liabilities | | | |
--------------------------------------------------------------------------------
| Other short-term debt | 28,058.2 | 21,185.8 | 32 % |
--------------------------------------------------------------------------------
| Total short-term | 28,886.9 | 21,952.1 | 32 % |
| liabilities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Total liabilities | 88,087.5 | 81,041.2 | 9 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Shareholders' equity and | 157,893.2 | 149,643.2 | 6 % |
| liabilities | | | |
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT, EUR 1,000
--------------------------------------------------------------------------------
| Cash flow from business | 1 Jan.- | 1 Jan.- | 1 Jan.- |
| operations: | 30 | 30 | 31 |
| | June 2008 | June 2007 | Dec. 2007 |
--------------------------------------------------------------------------------
| Net profit | 4,757 | 2,670 | 5,871 |
--------------------------------------------------------------------------------
| Adjustments to profit for the | 5,660 | 5,206 | 10,165 |
| period | | | |
--------------------------------------------------------------------------------
| Change in working capital | 2,684 | -1,270 | -4,566 |
--------------------------------------------------------------------------------
| Interest paid | -1,621 | -1,427 | -3,329 |
--------------------------------------------------------------------------------
| Interest received | 180 | 90 | 250 |
--------------------------------------------------------------------------------
| Income tax paid | -517 | -956 | -2,233 |
--------------------------------------------------------------------------------
| Net cash flow from operating | 11,143 | 4,312 | 6,157 |
| activities | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flow from investments: | | | |
--------------------------------------------------------------------------------
| Purchase of property, plant and | -1,280 | -1,008 | -1,979 |
| equipment, and intangible | | | |
| assets | | | |
--------------------------------------------------------------------------------
| Proceeds from sale of | 0 | | - |
| intangible assets and PPE | | | |
--------------------------------------------------------------------------------
| Acquisition of subsidiary, net | -2,803 | -209 | -2,339 |
| of cash acquired | | | |
--------------------------------------------------------------------------------
| Proceeds of sale of other | - | - | - |
| investments | | | |
--------------------------------------------------------------------------------
| Dividends received | - | - | - |
--------------------------------------------------------------------------------
| Cash flow from investments | -4,083 | -1,217 | -4,318 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flow from financing: | | | |
--------------------------------------------------------------------------------
| Proceeds from share issue | 7 | 17 | 1,241 |
--------------------------------------------------------------------------------
| Acquisition of own shares | -790 | - | - |
--------------------------------------------------------------------------------
| Equity financing of share-based | - | - | -971 |
| bonus scheme | | | |
--------------------------------------------------------------------------------
| Repayment of current loans | -33 | - | - |
--------------------------------------------------------------------------------
| Repayments of non-current loans | - | -150 | -252 |
--------------------------------------------------------------------------------
| Withdrawals of current loans | - | - | - |
--------------------------------------------------------------------------------
| Withdrawals of non-current | - | - | - |
| loans | | | |
--------------------------------------------------------------------------------
| Dividends paid and other profit | -2,041 | -1,625 | -1,625 |
| distribution | | | |
--------------------------------------------------------------------------------
| Cash flow from financing: | -2,858 | -1,758 | -1,606 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Change in cash and cash | 4,203 | 1,337 | 234 |
| equivalents | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at | 11,739 | 11,506 | 11,506 |
| beginning of period | | | |
--------------------------------------------------------------------------------
| Change in fair value of cash | - | - | - |
| and cash equivalents | | | |
--------------------------------------------------------------------------------
| Change in cash and cash | 4,203 | 1,337 | 234 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at | 15,942 | 12,842 | 11,739 |
| the end of the period | | | |
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, EUR 1,000
--------------------------------------------------------------------------------
| | a | b | c | d | e | f | g | h |
--------------------------------------------------------------------------------
| Balance | 2,03 | 6,72 | 44,93 | 0 | 0 | 9 305 | 114 | 63,119 |
| 1 | 1 | 9 | 9 | | | | | |
| Jan. 2007 | | | | | | | | |
--------------------------------------------------------------------------------
| Available- | | | | | | | | 0 |
| for-sale | | | | | | | | |
| investment | | | | | | | | |
| s: | | | | | | | | |
--------------------------------------------------------------------------------
| Fair value | | | | | | | | 0 |
| gains/loss | | | | | | | | |
| es | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | 103 | | 103 |
--------------------------------------------------------------------------------
| Items | 0 | 0 | 0 | 0 | 0 | 103 | 0 | 103 |
| recognised | | | | | | | | |
| directly | | | | | | | | |
| in equity | | | | | | | | |
--------------------------------------------------------------------------------
| Net profit | | | | | | 2,670 | 0 | 2,670 |
--------------------------------------------------------------------------------
| Total | 0 | 0 | 0 | 0 | 0 | 2,773 | 0 | 2,773 |
| recognised | | | | | | | | |
| income and | | | | | | | | |
| expenses | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Increase | 0 | 17 | | | | | | 17 |
| of share | | | | | | | | |
| capital | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | - | | -1,625 |
| payment | | | | | | 1,625 | | |
--------------------------------------------------------------------------------
| Other | | | | | | 25 | -114 | -89 |
--------------------------------------------------------------------------------
| BALANCE | 2,03 | 6,74 | 44,93 | 0 | 0 | 10,479 | 0 | 64,196 |
| 30 | 1 | 6 | 9 | | | | | |
| June 2007 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | a | b | c | d | e | f | g | h |
--------------------------------------------------------------------------------
| Balance | 2,08 | 7,89 | 43,31 | -12 | 0 | 15,321 | 0 | 68,602 |
| 1 | 5 | 3 | 4 | | | | | |
| Jan. 2008 | | | | | | | | |
--------------------------------------------------------------------------------
| Available- | | | | | | | | 0 |
| for-sale | | | | | | | | |
| investment | | | | | | | | |
| s: | | | | | | | | |
--------------------------------------------------------------------------------
| Fair value | | | | | | | | 0 |
| gains/loss | | | | | | | | |
| es | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | | |
--------------------------------------------------------------------------------
| Items | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| recognised | | | | | | | | |
| directly | | | | | | | | |
| in equity | | | | | | | | |
--------------------------------------------------------------------------------
| Net profit | | | | | | 4,757 | 0 | 4,757 |
--------------------------------------------------------------------------------
| Total | 0 | 0 | 0 | 0 | 0 | 4,757 | 0 | 4,757 |
| recognised | | | | | | | | |
| income and | | | | | | | | |
| expenses | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Increase | | 7 | | | | | | 7 |
| of share | | | | | | | | |
| capital | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | -2,04 | | | | | -2,041 |
| payment | | | 1 | | | | | |
--------------------------------------------------------------------------------
| Own-share | | | -1,00 | | | 210 | | -789 |
| redemption | | | 0 | | | | | |
| reserve | | | | | | | | |
--------------------------------------------------------------------------------
| Share-base | | | | | | -730 | | -730 |
| d | | | | | | | | |
| transactio | | | | | | | | |
| ns settled | | | | | | | | |
| in equity | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | 0 | | | | 0 |
--------------------------------------------------------------------------------
| BALANCE | 2,08 | 7,89 | 40,27 | -12 | 0 | 19,559 | 0 | 69,806 |
| 30 | 5 | 9 | 3 | | | | | |
| June 2008 | | | | | | | | |
--------------------------------------------------------------------------------
a = Share capital
b = Share premium
c = Other reserves and invested unrestricted equity
d = Currency translation differences
e = Fair value reserve
f = Retained earnings
g = Minority interest
h = Total shareholders' equity
NOTES TO THE ACCOUNTS
Accounting principles:
The accounting principles and calculation methods used in the previous year-end
accounts have been applied to this Interim Report.
The subsidiary acquired in the first quarter, Sunrise Resources Oy, has been
included in the consolidated financial statement as of 1 January 2008.
Seasonal nature of business:
The Group's business is affected by the number of workdays each month as well as
by holiday seasons.
Dividends paid:
A per-share dividend of EUR 0.10, or a total of EUR 2,041,426.80, was paid based
on the decision of the AGM of 11 March 2008. The dividend payment date was
25 March 2008.
Events after the balance sheet date:
There have been no major events since the report period.
Segment information:
--------------------------------------------------------------------------------
| NET SALES, EUR | 4-6/2 | 4-6/2 | Chang | 1-6/20 | 1-6/200 | Change | 1-12/20 |
| 1,000 | 008 | 007 | e, % | 08 | 7 | , % | 07 |
--------------------------------------------------------------------------------
| Telecommunicat | 16,51 | 12,02 | 37 % | 32,446 | 23,823 | 36 % | 47,963 |
| ions | 3 | 5 | | | | | |
--------------------------------------------------------------------------------
| Finance and | 8,611 | 6,710 | 28 % | 17,198 | 13,572 | 27 % | 29,298 |
| Services | | | | | | | |
--------------------------------------------------------------------------------
| Industry and | 8,008 | 7,168 | 12 % | 15,166 | 14,787 | 3 % | 28,578 |
| Trade | | | | | | | |
--------------------------------------------------------------------------------
| Group total | 33,13 | 25,90 | 28 % | 64,812 | 52,182 | 24 % | 105,839 |
| | 3 | 3 | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OPERATING | 4-6/2 | 4-6/2 | Chang | 1-6/20 | 1-6/20 | Change | 1-12/20 |
| PROFIT, | 008 | 007 | e, % | 08 | 07 | , % | 07 |
| EUR 1,000 | | | | | | | |
--------------------------------------------------------------------------------
| Telecommunicati | 2,530 | 1,437 | 76 % | 5,624 | 2,876 | 96 % | 5,671 |
| ons | | | | | | | |
--------------------------------------------------------------------------------
| Finance and | 147 | 368 | -60 % | 707 | 513 | 38 % | 2,617 |
| Services | | | | | | | |
--------------------------------------------------------------------------------
| Industry and | 1,062 | 663 | 60 % | 1,633 | 1,955 | -16 % | 3,511 |
| Trade | | | | | | | |
--------------------------------------------------------------------------------
| One-off items | | | | | | | -719 |
--------------------------------------------------------------------------------
| Group total | 3,739 | 2,468 | 51 % | 7,966 | 5,344 | 49 % | 11,080 |
--------------------------------------------------------------------------------
Acquired business operations:
Digia Plc acquired all shares of Sunrise Resources Ltd on 14 January 2008. The
acquisition price was EUR 3.6 million paid as a cash consideration and Digia
financed the transaction through its cash reserves. In addition, the sellers may
receive an additional purchase price based on Sunrise-r objectives for the year
2008. The maximum amount of the additional sales price is EUR 0.6 million, which
may be paid either in cash or in Digia's shares, as determined by Digia. The
acquisition generated EUR 2.5 million of goodwill, in addition to which
EUR 0.6 million of the acquisition price was allocated for the acquired
customers.
--------------------------------------------------------------------------------
| EUR 1,000 | Fair value | Book value before |
| | recognised upon | combination |
| | combination | |
--------------------------------------------------------------------------------
| Property, plant and equipment | 50 | 50 |
--------------------------------------------------------------------------------
| Intangible assets | 4 | 4 |
--------------------------------------------------------------------------------
| Financial assets | 32 | 32 |
--------------------------------------------------------------------------------
| Receivables | 463 | 463 |
--------------------------------------------------------------------------------
| Cash and cash equivalents | 865 | 865 |
--------------------------------------------------------------------------------
| Total assets | 1,413 | 1,413 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Income tax liabilities | 27 | 27 |
--------------------------------------------------------------------------------
| Other creditors | 260 | 260 |
--------------------------------------------------------------------------------
| Total liabilities | 287 | 287 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Net assets | 1,126 | 1,126 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Acquisition cost | 4,311 | |
--------------------------------------------------------------------------------
| Goodwill | 3,185 | |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Total acquisition cost | -4,311 | |
--------------------------------------------------------------------------------
| Additional purchase price, | 630 | |
| conditional | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents of | 865 | |
| the acquired subsidiary | | |
--------------------------------------------------------------------------------
| Cash flow effect | -2,816 | |
--------------------------------------------------------------------------------
Consolidated income statement by quarter:
--------------------------------------------------------------------------------
| EUR 1,000 | 4-6/2008 | 1-3/2008 | 10-12/200 | 7-9/2007 | 4-6/2007 |
| | | | 7 | | |
--------------------------------------------------------------------------------
| Net sales | 33,133.1 | 31,678.4 | 31,012.5 | 22,645.0 | 25,903.1 |
--------------------------------------------------------------------------------
| Other operating | 4.0 | 5.3 | -5.2 | 13.0 | 80.3 |
| income | | | | | |
--------------------------------------------------------------------------------
| Materials and | -3,271.2 | -2,822.5 | -2,706.7 | -1,978.7 | -1,755.9 |
| services | | | | | |
--------------------------------------------------------------------------------
| Depreciation and | -1,159.4 | -1,276.8 | -1,285.6 | -1,178.2 | -1,159.6 |
| impairment | | | | | |
--------------------------------------------------------------------------------
| Other operating | -24,967.9 | -23,356.9 | -22,803.1 | -17,977. | -20,599.8 |
| expenses | | | | 2 | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 3,738.6 | 4,227.6 | 4,211.9 | 1,524.0 | 2,468.0 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Financial | -721.4 | -797.1 | -858.2 | -800.2 | -733.8 |
| expenses (net) | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Pre-tax profit | 3,017.2 | 3,430.5 | 3,353.7 | 723.8 | 1,734.3 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Direct tax | -731.6 | -958.6 | -699.0 | -177.5 | -465.8 |
--------------------------------------------------------------------------------
| Net profit | 2,285.6 | 2,471.9 | 2,654.7 | 546.3 | 1,268.6 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Allocation: | | | | | |
--------------------------------------------------------------------------------
| Parent company | 2,285.6 | 2,471.9 | 2,654.7 | 546.3 | 1,268.6 |
| shareholders | | | | | |
--------------------------------------------------------------------------------
| Minority | 0.0 | 0 | 0.0 | 0.0 | 0.0 |
| shareholders | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.12 | 0.13 | 0.03 | 0.06 |
| share, EUR | | | | | |
--------------------------------------------------------------------------------
| Earnings per | 0.11 | 0.12 | 0.13 | 0.03 | 0.06 |
| share, EUR, | | | | | |
| diluted | | | | | |
--------------------------------------------------------------------------------
Group key figures and ratios:
--------------------------------------------------------------------------------
| | 1-6/2008 | 1-6/2007 | 2007 |
--------------------------------------------------------------------------------
| Extent of business | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Net sales | 64,812.0 | 52,182 | 105,839.4 |
--------------------------------------------------------------------------------
| - change from previous year | 24 % | 42 % | 25 % |
--------------------------------------------------------------------------------
| Average capital invested | 125,722 | 119,007 | 123,994 |
--------------------------------------------------------------------------------
| Personnel at period-end | 1,335 | 1,122 | 1,155 |
--------------------------------------------------------------------------------
| Average number of personnel | 1,284 | 1,099 | 1,116 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Profitability | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Operating profit | 7,966 | 5,344 | 11,080 |
--------------------------------------------------------------------------------
| - % of net sales | 12 % | 10 % | 10 % |
--------------------------------------------------------------------------------
| Earnings before tax | 6,448 | 3,820 | 7,898 |
--------------------------------------------------------------------------------
| - % of net sales | 10 % | 7 % | 7 % |
--------------------------------------------------------------------------------
| Net profit | 4,757 | 2,670 | 5,871 |
--------------------------------------------------------------------------------
| % of net sales | 7 % | 5 % | 6 % |
--------------------------------------------------------------------------------
| Return on equity, % | 14 % | 8 % | 9 % |
--------------------------------------------------------------------------------
| Return on investment, % | 13 % | 9 % | 9 % |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Financing and financial position | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 56,623 | 56,416 | 56,413 |
--------------------------------------------------------------------------------
| Short-term investments & cash and | 15,942 | 12,843 | 11,739 |
| bank receivables | | | |
--------------------------------------------------------------------------------
| Net gearing, % | 58 % | 68 % | 65 % |
--------------------------------------------------------------------------------
| Equity ratio, % | 45 % | 44 % | 47 % |
--------------------------------------------------------------------------------
| Net cash flow from operating | 11,143 | 4,312 | 6,157 |
| activities | | | |
--------------------------------------------------------------------------------
| Earnings per share, EUR, | 0.23 | 0.13 | 0.29 |
| undiluted | | | |
--------------------------------------------------------------------------------
| Earnings per share, EUR, diluted | 0.23 | 0.13 | 0.29 |
--------------------------------------------------------------------------------
| Equity per share | 3.35 | 3.16 | 3.32 |
--------------------------------------------------------------------------------
| Lowest share price | 2.55 | 3.37 | 2.93 |
--------------------------------------------------------------------------------
| Highest share price | 3.30 | 4.26 | 4.26 |
--------------------------------------------------------------------------------
| Average share price | 3.04 | 3.82 | 3.77 |
--------------------------------------------------------------------------------
| Market capitalisation | 61,727 | 85,341 | 61,079 |
--------------------------------------------------------------------------------
The formulae for the key figures and ratios are available in the presentation of
the previous year-end accounts. These formulae remained unchanged during the
reporting period.
The weighted average number of shares during the reporting period, adjusted for
share issues, totalled 20,427,556. The weighted average number of shares during
the reporting period, adjusted for dilution, totalled 20,427,556. The number of
outstanding shares totalled 20,853,645 at the end of the reporting period.
The company held a total of 249,599 treasury shares at the end of the reporting
period. All shares have been acquired during the reporting period. In accordance
with the decision of the Board of Directors, the company will continue the
buyback of own shares until it holds 300,000 treasury shares or has used EUR
1,000,000 for the buybacks.
Relating to the company's performance-based incentive system, Digia has financed
the acquisition of 300,000 own shares. In the coming years, these shares are
intended for distribution to key personnel as rewards for targets achieved as
per the conditions of the performance-based incentive system. In accordance with
the Board of Directors' decision, performance-based incentives to key personnel
will be paid in company shares.
The Group has no liabilities associated with derivative contracts.