Stock exchange release
18th February 2016 at 8.00 am
COMPTEL CORPORATION FINANCIAL STATEMENTS RELEASE FOR 2015
- Revenue grew by 14% to all time high of EUR 97.7 million for 2015
- Order backlog increased by 20.2%, order intake exceeded significantly net sales
Key figures for the Fourth Quarter of 2015:
- Net sales EUR 32.6 million (Q4 2014: 26.8), growth 21.7%
- Operating result EUR 5.6 million (3.9), growth 42.3%
- Net profit EUR 4.0 million (4.3), change -6.8%
- Earnings per share EUR 0.04 (0.04)
-
Order backlog EUR 66.3 million (55.2), growth 20.2%
Key figures for the Full Year of 2015:
- Net sales EUR 97.7 million (2014: 85.7), growth 14%
- Operating result EUR 8.5 million (8.3), growth 2%
- Net profit EUR 4.5 million (5.5), change -17.2%
- Earnings per share EUR 0.04 (0.05)
Dividend proposal
Board of Directors proposes to the Annual General Meeting that dividend of 0.03 EUR per share will be paid for 2015
Outlook
Comptel expects the 2016 net sales to continue to grow and operating profit to be in the range of 8-14% of revenue.
Characteristically a significant part of Comptel’s operating profit and net sales is generated in the second half of the year.
These statements for 2015 are based on the company's audited financial statements. The Auditor's Report was issued 17 February, 2016.
Juhani Hintikka, President and CEO:
” We are very pleased with our growth for 2015. In the fourth quarter our net sales and order intake were highest in our history and we closed the year with highest ever backlog. During 2015 we invested significantly in developing the new FWD software-as-a-service and bringing that to market. We also invested significantly in increased delivery capacity and in sales and marketing as well as in our current portfolio. This is to strengthen our growth in future years. These investments for future growth did lower our relative profitability during 2015, but we still managed to improve our operating profit from last year. Going forward we are looking to improve our relative profitability further.
Geographically Europe and APAC grew significantly during 2015. Revenue in Europe was on an all time high level both in the fourth quarter and the full year. Our strategy execution and progress especially in Europe was excellent during 2015 and we built a solid future especially with our global operator customers there.
Both business units grew significantly in the fourth quarter. Transformation projects for our operator customers continued to be a major market driver for our growth. We managed to position Comptel solidly as a challenger with innovative offering and that drove demand.
Our FlowOne solution’s excellent competitiveness and strengthening market position impacted significantly our revenue growth. Intelligent Data unit did also well and performed 30 upgrades to the new Data Refinery platform. We also signed four new integrated analytics customers in Intelligent Data Business Unit. The new digital sales channel solution FWD was launched in the fourth quarter. Customers have shown significant interest towards FWD and we expect to win several new customers in 2016.
Due to new ruling by the tax regulators regarding withholding tax, taxes from 2014 were corrected in 2015. This adjustment of EUR 0.3 million had a negative impact on net profit for the full year.
During 2015, we secured 29 significant orders valued over EUR 0.5 million. In 2014, the comparable number of orders was 26.”
Business review 2015
In the fourth quarter, Comptel’s net sales increased by 21.7 percent compared to previous year and were EUR 32.6 million (26.8). Sales in both business units were strong in the fourth quarter, Intelligent Data growing 19.8 per cent and Service Orchestration 23.4 per cent compared to last year. In the fourth quarter, most of the solutions within the business units grew compared to previous year’s fourth quarter as well as compared to third quarter in 2015.
Full year net sales increased by 14 per cent compared to previous year the main driver being Comptel FlowOne solution sales. Service Orchestration sales grew by 20.1 per cent compared to previous year.
The operating profit for 2015 was EUR 8.5 million (8.3), which is 8.7 per cent of net sales (9.7). The relative lower profitability was driven by significant investments in development of FWD cloud solution, investment in delivery capacity as well as current product portfolio.
The operating result for 2015 was EUR 8.5 million (8.3), which is 8.7 per cent of net sales (9.7). The relative lower profitability was driven by investments in development of FWD solution, a future platform, investment in delivery capacity as well as current product portfolio.
Financial income/expenses were EUR -1.1 million for the full year 2015 (-0.9). This was due to fluctuation in exchange rates between EUR and other currencies during the year.
For 2015, profit before taxes was EUR 7.6 million (7.4) and net profit for the period was EUR 4.5 million (5.5). Earnings per share for the period was EUR 0.04 (0.05).
The consolidated effective tax rate in 2015 was 40.5 per cent (26.6).In the latest tax decision the tax authorities changed the interpretation on withholding taxes for certain countries. Due to this decision a onetime adjustment for 2014 taxes was made in 2015 which had a 4.2 per cent negative impact on the effective tax rate. The new decision also increased 2015 effective tax rate by 3.3 per cent.
The tax expense for the financial year was EUR 3.1 million (2.0), including EUR 1.2 million of withholding taxes (0.5).
Order backlog for the next 12 months increased from the previous year and was EUR 66.3 million (55.2) at the end of the financial year. The company’s total backlog including multi-year orders is over EUR 90 million (at the end of 2014 over EUR 70 million).
Comptel strategy
Life is digital moments. Digital demand will be driven by “Generation Cloud” customers and enterprises interacting with millions of digital applications. The Internet of Things with billions of connected devices will further accelerate the digital demand leading to exploding data volumes. Future mobile and fixed networks will provide hyper speeds and undergo a transformation from hardware to software. Network functions will be virtualised. Mounting complexity will require orchestration of business flows and virtualised resources.
Comptel mission is to perfect the digital moments and translate them into business moments by connecting digital demand and supply.
The Comptel strategy focuses on providing solutions for digital and communications service providers in two major areas – Intelligent Data and Service Orchestration. The Intelligent Data business delivers solutions and services to customers for monetising data and turning big data into intelligent automated actions. The Service Orchestration business area provides solutions and services for business flow orchestration and mastering the digital buying experience.
Comptel’s strategic target is to establish itself as a leading software vendor for connecting digital demand and supply.
Strategy execution is based on six strategic objectives: solutions with unique value, thought leadership, customer excellence, new markets, leverage by partners and inspired people.
Comptel´s marketing strategy strives for industry thought leadership on carefully selected themes and topics which are: Digital Buying Experience, Monetising more with less time, Orchestration of service and order flows from ground to cloud and intelligent fast data. The essence of Comptel’s thought leadership is captured in the book “Operation Nexterday” that was launched in Barcelona’s Mobile World Congress in March 2015.
Business areas
|
Net sales, EUR million |
10-12 2015 |
10-12 2014 |
Change % | 1-12 2015 | 1-12 2014 |
Change % |
| Europe | 15.7 | 11.8 | 32.7 | 40.1 | 35.4 | 13.4 |
| Asia Pacific | 8.9 | 5.7 | 55.2 | 29.6 | 24.8 | 19.6 |
| Middle East and Africa | 4.8 | 6.4 | -25.4 | 16.8 | 16.8 | -0.1 |
| Americas | 3.2 | 2.8 | 15.4 | 11.2 | 8.8 | 27.8 |
| Total | 32.6 | 26.8 | 21.8 | 97.7 | 85.7 | 14.0 |
|
Operating result, EUR million |
||||||
| Europe | 12.0 | 7.7 | 55.6 | 27.5 | 19.5 | 40.8 |
| Asia Pacific | 4.8 | 2.4 | 97.7 | 15.5 | 14.5 | 6.6 |
| Middle East and Africa | 1.8 | 3.3 | -44.6 | 5.6 | 7.3 | -23.0 |
| Americas | 1.6 | 1.4 | 13.0 | 5.6 | 4.0 | 40.8 |
| Unallocated costs | -14.6 | -10.9 | 33.7 | -45.8 | -37.0 | 23.6 |
| Total | 5.6 | 3.9 | 42.3 | 8.5 | 8.3 | 2.0 |
|
Operating result, % of net sales |
||||||
| Europe | 76.1 | 64.9 | - | 68.6 | 55.3 | - |
| Asia Pacific | 54.2 | 42.6 | - | 52.3 | 58.7 | - |
| Middle East and Africa | 38.4 | 51.7 | - | 33.3 | 43.2 | - |
| Americas | 49.1 | 50.1 | - | 50.1 | 45.5 | - |
| Total | 17.2 | 14.7 | - | 8.7 | 9.7 | - |
In the fourth quarter, both Europe and Asia Pacific net sales grew significantly compared to the fourth quarter of last year. For the full year, net sales grew significantly in all regions except in Middle East and Africa.
For the full year operating result in Europe increased significantly. Key driver for this was sales mix and project execution. Also Americas operating profit increased due to project execution as well as sales mix.
In 2015, Comptel received 29 significant orders (26): Service Orchestration received 16 orders (eleven for the FlowOne Fulfillment solution, five for FlowOne Provisioning and Activation) and Intelligent Data received six orders (four for Data Refinery, one for Fastermind and one for the Monetizer solution). Seven orders were multi-solution orders across business units. As significant orders Comptel reports sold projects and licenses with a minimum value of EUR 0.5 million.
|
Net sales breakdown, EUR million |
10-12 2015 |
10-12 2014 |
Change % |
1-12 2015 |
1-12 2014 |
Change % |
| Project & License business | 24.0 | 18.8 | 27.9 | 63.3 | 52.1 | 21.4 |
| Recurring business | 8.6 | 8.0 | 7.2 | 34.4 | 33.6 | 2.5 |
| Total | 32.6 | 26.8 | 21.8 | 97.7 | 85.7 | 14.0 |
Project and license sales increased significantly in the fourth quarter as well as in the full year compared to previous year’s comparable periods. This was due to winning new projects during the year. Also Support and Maintenance revenue grew in the fourth quarter.
|
Net sales breakdown, EUR million |
10-12 2015 |
10-12 2014 |
Change % |
1-12 2015 |
1-12 2014 |
Change % |
| Intelligent Data | 14.6 | 12.2 | 19.8 | 42.5 | 39.7 | 7.1 |
| Service Orchestration | 18.0 | 14.6 | 23.4 | 55.2 | 46.0 | 20.1 |
| Total | 32.6 | 26.8 | 21.8 | 97.7 | 85.7 | 14.0 |
Both business units grew significantly in the fourth quarter compared to previous year. For the full year both business units grew but especially the Service Orchestration unit was the main driver for the growth.
Financial Position
| EUR million | 31 Dec 2015 | 31 Dec 2014 |
Change % |
| Statement of financial position total | 86.4 | 77.6 | 11.3 |
| Liquid assets | 3.0 | 9.4 | -67.6 |
| Trade receivables, gross | 42.1 | 28.9 | 45.6 |
| Bad debt provision | -1.6 | -1.2 | 39.0 |
| Trade receivables, net | 40.5 | 27.7 | 45.9 |
| Accrued income | 10.0 | 10.9 | -8.7 |
| Deferred income related to partial debiting | 3.3 | 4.4 | -25.8 |
| Interest-bearing debt | 7.2 | 7.6 | -5.2 |
| Equity ratio, per cent | 52.4 | 52.4 | -0.1 |
The balance sheet total on 31 December 2015 was EUR 86.4 million (77.6), of which liquid assets amounted to EUR 3.0 million (9.4). Operating cash flow for the full year was EUR 0.6 million (10.0). For the fourth quarter the operating cash flow was EUR -0.2 million (3.5). Cashflow was lower in 2015 due to the investments during the year.
Trade receivables were EUR 40.5 million (27.7) at the end of the period. The trade receivables increased significantly at the end of the year due to strong net sales in later part of the year. Accrued income was EUR 10.0 million (10.9). Deferred income related to partial debiting was EUR 3.3 million (4.4).
Comptel has a EUR 25 million credit facility arrangement consisting of EUR 20 million revolving credit facility and EUR 5 million overdraft capacity on current bank account. Out of this arrangement Comptel had EUR 5 million of the revolving credit facility and EUR 2 million of the overdraft capacity outstanding at the end of the period. The credit facility is valid until July 2018.
The equity ratio was 52.4 per cent (52.4) and the gearing ratio was 11.1 per cent (-5.4).
Research and Development (R&D)
| EUR million |
10-12 2015 |
10-12 2014 |
Change % |
1-12 2015 |
1-12 2014 |
Change % |
| Direct R&D expenditure | 7.5 | 5.1 | 45.6 | 20.3 | 16.8 | 20.9 |
| Capitalisation of R&D expenditure according to IAS 38 | -1.5 | -1.3 | 8.2 | -5.2 | -4.7 | 9.7 |
| R&D depreciation and impairment charges | 1.4 | 1.2 | 20.1 | 5.5 | 4.9 | 12.1 |
| R&D expenditure, net | 7.4 | 5.0 | 49.7 | 20.6 | 17.0 | 21.5 |
| Direct R&D expenditure, % of net sales | 22.9 | 19.2 | - | 20.8 | 19.6 | - |
Direct R&D expenditure represented 20.8 per cent (19.6) of net sales in 2015.
The focus of Comptel’s R&D expenditure was in the further development of solutions in the main product areas, Service Orchestration and Intelligent Data. Development is targeted both to secure the recurring revenue with competitive products and to win new markets by giving customers unique value with new innovations. Service Orchestration’s FlowOne Fulfillment solution is developed as a suite of orchestration elements that manage the service and business flows from ground to cloud. Intelligent Data’s Data Refinery captures data-in-motion and uses embedded intelligence to refine it for automated, in-the-moment decisions and actions. Monetizer is the business policy and charging tool that allows the rapid innovation and design of rich communication and data service offers. Data Fastermind embeds artificial intelligence, prediction and machine learning capabilities into all solutions.
In these areas Comptel seeks global thought leadership in solving the business challenges of operators and digital communications service providers. Additionally Comptel has started to invest in new products around the digital buying experience.
During 2015, Comptel continued to develop its current offering, and twelve major software releases were launched in these respective product areas.
Investments
| EUR million |
10-12 2015 |
10-12 2014 |
Change % |
1-12 2015 |
1-12 2014 |
Change % |
| Gross investments in property, plant and equipment and intangible assets | 0.2 | 0.4 | -55.5 | 0.6 | 0.7 | -24.6 |
The investments comprised of devices, software and furnishings and were funded through cash flow from operations.
Personnel
| 31 Dec 2015 | 31 Dec 2014 |
Change % |
|
| Number of employees at the end of period | 742 | 660 | 12.4 |
|
1-12 2015 |
1-12 2014 |
Change % |
|
| Average number of personnel during the period | 723 | 665 | 8.7 |
The number of personnel increased due to investments in R&D and delivery capacity. In the fourth quarter, personnel expenses were 47.2 per cent of net sales (47.4). For the full year, personnel expenses were 47.9 per cent of net sales (48.2).
At the end of the period, 29.5 per cent (30.2) of the personnel were located in Finland, 25.5 per cent (28.8) in Malaysia, 11.3 per cent (7.1) in India, 10.2 per cent (10.9) in Bulgaria, and 23.5 per cent (23.0) in other countries where Comptel operates.
Comptel’s share
The closing share price of the period was EUR 1.83 (0.99). Comptel’s market value at the end of the period was EUR 198.1 million (105.8).
| Comptel share |
10-12 2015 |
10-12 2014 |
Change % |
1-12 2015 |
1-12 2014 |
Change % |
| Shares traded, million | 16.6 | 7.1 | 133.5 | 41.2 | 27.8 | 48.4 |
| Shares traded, EUR million | 24.7 | 5.0 | 393.8 | 52.9 | 16.5 | 219.7 |
| Highest price, EUR | 1.93 | 1.00 | 93.0 | 1.93 | 1.00 | 93.0 |
| Lowest price, EUR | 1.15 | 0.55 | 109.1 | 0.84 | 0.48 | 75.0 |
Of Comptel’s outstanding shares, 6.0 per cent (5.1) were nominee registered or held by foreign shareholders at the end of the period.
At the end of the period the company held 118,507 of its own shares, which is 0.11 per cent of the total number of shares. The total counter-book value of the shares held by the company was EUR 2,341.
4,508,260 share options were distributed during the year 2015.
The Board of Directors decided 9 September 2015, based on the authorization received from the Annual General Meeting held on 9 April 2015, to grant in total 3,478,260 options for a new incentive program to the CEO. The options give the right to subscribe for 3,478,260 company shares in total.
Out of the subscription rights 1,739,130 are marked with symbol 2015A and 1,739,130 are marked with symbol 2015B. According to the rules of the incentive plan, the share subscription price is EUR 0.92, which is the volume-weighted average price of the company's share in NASDAQ OMX Helsinki during 12 August 2015 - 8 September 2015 deducted with 20 %.
Corporate Governance
The Annual General Meeting (AGM) of Comptel Corporation was held on 9th of April 2015. The resolutions of the Annual General Meeting as well as the minutes of the Annual General Meeting can be found at company’s web page www.comptel.com.
The AGM authorised the Board of Directors to decide on share issues amounting to a maximum of 21,400,000 new shares and on repurchase or conveying of the company's own shares up to a maximum number of 10,700,000 shares. The authorisations are valid until 30 June 2016. However, the authorisation to implement the company's share-based incentive programs is valid five years from the AGM resolution.
A separate stock exchange release about the authorisations given and other decisions made by the Annual General Meeting was published 9 April 2015.
Events after the reporting period
There were no significant events after the reporting period.
Near-term risks and uncertainties
Comptel develops dynamic end-to-end solutions for leading operators globally in the telecom field. This requires Comptel to understand correctly the trends taking place in its business environment and the needs of its customers and resellers by each region. Failure to identify market conditions, address customers’ needs and develop its products in a timely manner may significantly undermine the growth of Comptel’s business and its profitability.
Characteristics of Comptel’s field of industry are significant quarterly variations of net sales and profit, which are related to customers’ purchasing behaviour and the timing of major single deals.
Comptel’s business consists of deliveries of large productised IT systems, and the value of a single project may be several million euros. Therefore, the credit risk associated with a single project or an individual customer may be significant. Furthermore, some of Comptel’s customers operate in countries where the political or financial climate can be unstable which in part may increase credit risk.
Comptel operates globally and so it is exposed to risks arising from different currency positions. Exchange rate changes between the euro, which is the company’s reporting currency, and the US dollar, UK pound sterling and Malaysian ringgit affect the company’s net sales, expenses and net profit.
The application process to prevent Comptel’s double taxation is still pending with the Ministry of Finance in Finland. However, the process between the states is very slow and the timing of a decision is hard to forecast. The interpretation of tax treaties may result in different views between the countries in question. This could mean that the double taxation will prevail. Comptel has also applications for return of withholding taxes in other countries but they are subject to local legal processes, which take time to get completed.
The risks and uncertainties of Comptel are described in more detail in the company’s financial statements and the Board of Directors’ report for 2015.
Business outlook and markets
It is more and more evident that both the business environment and technology in telecommunications business are entering a new disruption point. New competition from global technology giants like Facebook, Google and Apple is challenging operators in their core business and forcing them to adapt to the new business models and look for cost-efficiency and flexibility in their operations. We expect this trend to continue also during the next few years and to bring Comptel considerable opportunity by connecting to this new demand.
Currently key operator investment are driven by the vastly increasing data demand and targeted to increase the network bandwidth. Roll-outs of 4G and fibre networks are going on worldwide and operators have a strong need to harvest this capacity also with new money-generating services. Importance of customer experience and fierce competition both inside the telecoms industry and against the disruptors requires that operators improve their business processes continuously and pay special attention to the cost structure.
Traditionally the role of Comptel’s software has been in the management of services and assigning network capacity to end users. The on-going shift of networks towards new cloud-based software technologies and the resulting tighter integration of network and business layers will mean that the significance and value of the management software will increase. This is expected to bring new and more extensive business opportunities for Comptel Service Orchestration and Intelligent Data solutions.
In the search of new revenue sources operators need more flexibility in integration towards other business domains. To open up these new channels they need to introduce more sophisticated sales, order management and charging systems. The customers in this market position require both more high value services and new project deliveries that will create opportunity for business growth.
Changes in Reporting
The company will be changing its segment reporting from 2016 onwards. The new segments will be Business Units: Intelligent Data and Service Orchestration. Comparable numbers for 2015 will be published in March 2016.
Outlook
Comptel expects the 2016 net sales to continue to grow and operating profit to be in the range of 8-14% of revenue.
Characteristically a significant part of Comptel’s operating profit and net sales is generated in the second half of the year.
Board of Directors Proposal for the Disposal of Profits
The Group parent company’s distributable equity on 31 December 2015 was EUR 7,692,598 (6,740,529).
Board of Directors proposes to the Annual General Meeting that dividend of 0.03 per share will be paid for 2015.
COMPTEL CORPORATION
Board of Directors
Additional information:
Mr Juhani Hintikka, President and CEO, tel. +358 9 700 1131
Mr Tom Jansson, CFO, tel. +358 40 700 1849
FINANCIAL TABLES
The full year financial information in this stock exchange release is based on the company’s audited financial statements. The auditor’s report was issued on the 17th of February 2016. The accounting policies and methods of computation adopted in the financial statements are consistent with those of the annual financial statements for the year ended 2014.
All figures in the financial report have been rounded and consequently the sum of the individual figures can deviate from the sum figure. The interim report is unaudited.
| Consolidated Statement of Comprehensive Income (EUR 1,000) |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
1 Oct – 31 Dec 2015 |
1 Oct – 31 Dec 2014 |
|||
| Net sales | 97,728 | 85,714 | 32,611 | 26,792 | |||
| Other operating income | 63 | 282 | 40 | 1 | |||
| Materials and services | -5,546 | -3,905 | -1,556 | -1,050 | |||
| Employee benefits | -46,764 | -41,294 | -15,383 | -12,689 | |||
| Depreciation, amortisation and impairment charges | -6,756 | -6,263 | -1,672 | -1,501 | |||
| Other operating expenses | -30,251 | -26,225 | -8,432 | -7,614 | |||
| -89,317 | -77,686 | -27,043 | -22,853 | ||||
| Operating profit/loss | 8,474 | 8,311 | 5,608 | 3,940 | |||
| Financial income | 1,392 | 1,478 | 91 | 599 | |||
| Financial expenses | -2,541 | -2,398 | -65 | -364 | |||
| Share of results of associated companies | 287 | 45 | 287 | 45 | |||
| Profit/loss before income taxes | 7,612 | 7,436 | 5,921 | 4,220 | |||
| Income taxes | -3,085 | -1,975 | -1,958 | 31 | |||
| Profit/loss for the period | 4,527 | 5,461 | 3,963 | 4,251 | |||
| Other comprehensive income: | |||||||
| Other comprehensive income to be reclassified to profit or loss in subsequent periods | |||||||
| Translation differences | 189 | 522 | 75 | -152 | |||
| Cash flow hedges | 14 | -227 | -505 | -227 | |||
| Income tax relating to components of other comprehensive income | -3 | 45 | 101 | 45 | |||
| Total other comprehensive income | 200 | 341 | -329 | -333 | |||
| Total comprehensive income for the period | 4,728 | 5,802 | 3,634 | 3,917 | |||
| Profit/loss attributable to: | |||||||
| Equity holders of the parent company | 4,527 | 5,461 | 3,963 | 4,251 | |||
| Total comprehensive income attributable to: | |||||||
| Equity holders of the parent company | 4,728 | 5,802 | 3,634 | 3,917 | |||
| Shareholders of the parent company: | |||||||
| Earnings per share, EUR | 0.04 | 0.05 | 0.4 | 0.04 | |||
| Earnings per share, diluted, EUR | 0.04 | 0.05 | 0.4 | 0.04 | |||
|
|
|||||||
|
Consolidated Statement of Financial Position (EUR 1,000) |
31 Dec 2015 | 31 Dec 2014 | |||||
| Assets | |||||||
| Non-current assets | |||||||
| Goodwill | 2,646 | 2,646 | |||||
| Other intangible assets | 12,837 | 13,435 | |||||
| Tangible assets | 1,152 | 1,596 | |||||
| Investments in associates | 960 | 673 | |||||
| Available-for-sale financial assets | 87 | 87 | |||||
| Deferred tax assets | 7,685 | 5,880 | |||||
| Other non-current receivables | 646 | 613 | |||||
| 26,013 | 24,929 | ||||||
| Current assets | |||||||
| Trade and other current receivables | 56,929 | 43,043 | |||||
| Current tax asset | 403 | 315 | |||||
| Cash and cash equivalents | 3,030 | 9,352 | |||||
| 60,363 | 52,710 | ||||||
| Total assets | 86,376 | 77,638 | |||||
| Equity and liabilities | |||||||
| Equity attributable to equity holders of the parent company | |||||||
| Share capital | 2,141 | 2,141 | |||||
| Fund of invested non-restricted equity | 1,698 | 401 | |||||
| Fair value reserve | -510 | -182 | |||||
| Translation differences | -171 | -699 | |||||
| Retained earnings | 34,165 | 31,685 | |||||
| Total equity | 37,324 | 33,346 | |||||
| Non-current liabilities | |||||||
| Deferred tax liabilities | 2,572 | 2,669 | |||||
| Non-current financial liabilities | 92 | 1,257 | |||||
| 2,664 | 3,926 | ||||||
| Current liabilities | |||||||
| Provisions | 1,090 | 1,325 | |||||
| Current financial liabilities | 7,075 | 6,305 | |||||
| Trade and other current liabilities | 38,222 | 32,737 | |||||
| 46,388 | 40,367 | ||||||
| Total liabilities | 49,052 | 44,292 | |||||
| Total equity and liabilities | 86,376 | 77,638 | |||||
|
Consolidated Statement of Cash Flows (EUR 1,000) |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
| Cash flows from operating activities | ||
| Profit/loss for the period | 4,527 | 5,461 |
| Adjustments: | ||
| Non-cash transactions or items that are not part of cash flows from operating activities | 7,834 | 6,095 |
| Interest and other financial expenses | 273 | 620 |
| Interest income | -88 | -16 |
| Income taxes | 3,069 | 1,996 |
| Change in working capital: | ||
| Change in trade and other current receivables | -14,240 | -6,573 |
| Change in trade and other current liabilities | 5,031 | 6,744 |
| Change in provisions | -277 | -262 |
| Interest and other financial expenses paid | -273 | -146 |
| Interest received | 12 | -109 |
| Income taxes paid and tax returns received | -5,245 | -3,789 |
| Net cash from operating activities | 623 | 10,021 |
| Cash flows from investing activities | ||
| Proceeds from sale of business operations | - | 300 |
| Investments in tangible assets | -456 | -735 |
| Investments in intangible assets | -102 | - |
| Investments in development projects | -5,176 | -4,721 |
| Proceeds from the sale of tangible assets | 7 | 39 |
| Change in other non-current receivables | -3 | -82 |
| Net cash used in investing activities | -5,730 | -5,199 |
| Cash flows from financing activities | ||
| Dividends paid | -1,907 | -1,073 |
| Acquisition of own shares | - | -312 |
| Proceeds from new shares | 497 | - |
| Proceeds from share options | 800 | - |
| Proceeds from borrowings | 27,935 | 8,500 |
| Repayment of borrowings | -28,063 | -9,544 |
| Lease payments | -243 | -81 |
| Change in other non-current liabilities | - | -100 |
| Net cash used in financing activities | -981 | -2,609 |
| Net change in cash and cash equivalents | -6,116 | 2,213 |
| Cash and cash equivalents at the beginning of the period | 9,352 | 6,542 |
| Cash and cash equivalents at the end of the period | 3,030 | 9,352 |
| Change | -6,322 | 2,809 |
| Effects of changes in foreign exchange rates | -205 | 309 |
| Consolidated Statement of Changes in Equity | |||||||
| Equity attributable to equity holders of the parent company | |||||||
| EUR 1,000 | Share capital | Other reserves | Translation differences | Fair value reserve | Retained earnings | Total | |
|
Equity at 31 Dec 2013 |
2,141 | 401 | -1,219 | - | 27,600 | 28,924 | |
| Dividends | -1,073 | -1,073 | |||||
| Acquisition of Company’s own shares | -311 | -311 | |||||
| Share-based compensation | 263 | 263 | |||||
| Prior year correction * | -256 | -256 | |||||
| Total comprehensive income for the period | 521 | -182 | 5,461 | 5,800 | |||
|
Equity at 30 Sep 2014 |
2,141 | 401 | -698 | -182 | 31,684 | 33,346 | |
| Consolidated Statement of Changes in Equity | |||||||
| Equity attributable to equity holders of the parent company | |||||||
| EUR 1,000 | Share capital | Other reserves | Translation differences | Fair value reserve | Retained earnings | Total | |
|
Equity at 31 Dec 2014 |
2,141 | 401 | -698 | -182 | 31,684 | 33,346 | |
| Dividends | -2,139 | -2,139 | |||||
| Shares issued | 497 | 497 | |||||
| Share-based compensation | 800 | 428 | 1,228 | ||||
| Dissolution of a subsidiary | 7 | 7 | |||||
| Prior year correction * | -342 | -342 | |||||
| Total comprehensive income for the period | 189 | 11 | 4,527 | 4,727 | |||
|
Equity at 30 Sep 2015 |
2,141 | 1,698 | -509 | -171 | 34,165 | 37,324 | |
*Prior year expenses were corrected directly to Retained Earnings during the reporting periods.
Notes
1. Application of new or amended standards and interpretations
Comptel has adopted the new or amended standards and interpretations, effective for the financial years beginning on or after 1 January 2015. However those have not had an impact on the consolidated financial statements.
2. Segment information
Net sales by segment
| EUR 1,000 |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
1 Oct – 31 Dec 2015 |
1 Oct – 31 Dec 2014 |
| Europe | 40,095 | 35,358 | 15,719 | 11,847 |
| Asia-Pacific | 29,607 | 24,752 | 8,868 | 5,713 |
| Middle East and Africa | 16,795 | 16,814 | 4,810 | 6,447 |
| Americas | 11,231 | 8,790 | 3,214 | 2,786 |
| Group total | 97,728 | 85,714 | 32,611 | 26,792 |
Operating profit/loss by segment
| EUR 1,000 |
1 Jan – 3 Dec 2015 |
1 Jan – 31 Dec 2014 |
1 Oct – 31 Dec 2015 |
1 Oct – 31 Oct 2014 |
| Europe | 27,515 | 19,538 | 11,960 | 7,687 |
| Asia-Pacific | 15,483 | 14,526 | 4,805 | 2,431 |
| Middle East and Africa | 5,600 | 7,271 | 1,847 | 3,332 |
| Americas | 5,631 | 3,998 | 1,578 | 1,397 |
| Group unallocated expenses | -45,755 | -37,023 | -14,581 | -10,907 |
| Group operating profit/loss total | 8,474 | 8,311 | 5,608 | 3,940 |
| Financial income and expenses | -1,149 | -918 | 34 | 235 |
| Share of result of associated companies | 287 | 45 | 287 | 45 |
| Group profit/loss before income taxes | 7,612 | 7,436 | 5,930 | 4,220 |
3. Income tax
Income tax expense according to the statement of comprehensive income for the period was EUR 3,085 thousand (EUR 1,975 thousand).
In 2006, the Board of Adjustment of the Tax Office for Major Corporations refused to accept the crediting of taxes withheld at source in taxation of 2004 and 2005.
The application process to prevent Comptel’s double taxation is still pending with the Ministry of Finance in Finland. However, the process between the states is very slow and the timing of a change is hard to forecast. The interpretation of tax treaties may result in different views between the countries in question. This could mean that the double taxation will prevail.
According to the Board of Adjustment’s decision currently in force, Comptel Corporation has expensed taxes withheld at source amounting to EUR 1,167 thousand in the accounting year 2015 (EUR 468 thousand).
4. Tangible assets
| EUR 1,000 |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
| Additions | 456 | 740 |
| Disposals | -150 | -1,456 |
5. Related party transactions
The Comptel Group have a related party relationship with its associate, the Board of Directors, the Executive Board and also with people and companies under Comptel management’s influence.
Transactions which have been entered into with related parties are as follows:
| EUR 1,000 |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
| Associate | ||
| Other operating income | - | 1 |
| Interest income | 8 | 8 |
| EUR 1,000 | 31 Dec 2015 | 31 Dec 2014 |
| Associate | ||
| Non-current receivables | 201 | 113 |
Remuneration to key management
Key management personnel compensation includes the employee benefits of the members of the Board of Directors and the Executive Board.
| EUR 1,000 | 1 Jan – 31 Dec 2015 | 1 Jan – 31 Dec 2014 |
| Salaries and other short-term employee benefits | 2,169 | 2,131 |
| Share-based payments | 725 | 131 |
| Total | 2,894 | 2,262 |
During the period a new incentive program was decided for the CEO, in which against his own investment new options of 3,478,260 were granted.
Guarantees and other commitments
| EUR 1,000 | 31 Dec 2015 | 31 Dec 2014 |
| Guarantees | 9 | 7 |
6. Commitments
Minimum lease payments on non-cancellable office facilities and other operating leases are payable as follows:
| EUR 1,000 | 31 Dec 2015 | 31 Dec 2014 |
| Less than one year | 2,161 | 2,439 |
| Between one and five years | 1,218 | 2,962 |
| Total | 3,379 | 5,401 |
The group had no material capital commitments for the purchase of tangible assets at 31 December 2015 and 31 December 2014.
7. Contingent liabilities
| EUR 1,000 | 31 Dec 2015 | 31 Dec 2014 |
| Bank guarantees | 2,728 | 2,881 |
| Corporate mortgages | 200 | 200 |
| EUR 1,000 | 31 Dec 2015 | 31 Dec 2014 |
| Contingent liabilities on behalf of others | ||
| Guarantees | 29 | 34 |
8. Fair values of financial assets and liabilities
|
EUR 1,000 |
Book value 31 Dec 2015 |
Fair value 31 Dec 2015 |
Book value 31 Dec 2014 |
Fair value 31 Dec 2014 |
| Financial assets | ||||
| Financial assets at fair value through profit or loss | ||||
| Forward contracts (level 2) | - | - | 25 | 25 |
| Available-for-sale financial assets (level 3)) | 87 | 87 | 87 | 87 |
| Non-current trade receivables | 1,872 | 1,872 | 1,466 | 1,466 |
| Current trade receivables | 40,232 | 40,232 | 27,449 | 27,449 |
| Other current receivables | 7,133 | 7,133 | 4,624 | 4,624 |
| Cash and cash equivalents | 3,030 | 3,030 | 9,352 | 9,352 |
| Financial liabilities | ||||
| Financial liabilities at fair value through profit or loss | ||||
| Forward contracts (level 2) | 138 | 138 | 847 | 847 |
| Trade payables and other liabilities | 38,020 | 38,020 | 32,713 | 32,713 |
| Non-current loans from financial institutions | 33 | 33 | 1,078 | 1,081 |
| Non-current finance lease liabilities | 58 | 58 | 179 | 179 |
| Current loans from financial institutions | 5,044 | 5,056 | 5,984 | 6,095 |
| Current overdraft facility | 1,918 | 1,918 | - | - |
| Current finance lease liabilities | 112 | 112 | 259 | 259 |
| Other current liabilities | - | - | 63 | 63 |
9. Key figures
| Financial summary |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
| Net sales, EUR 1,000 | 97,728 | 85,714 |
| Net sales, change % | 14.0 | 3.7 |
| Operating profit/loss, EUR 1,000 | 8,474 | 8,311 |
| Operating profit/loss, change % | 2.0 | 13.7 |
| Operating profit/loss, as % of net sales | 8.7 | 9.7 |
| Profit/loss before taxes, EUR 1,000 | 7,612 | 7,436 |
| Profit/loss before taxes, as % of net sales | 7.8 | 8.7 |
| Return on equity, % | 12.8 | 17.5 |
| Return on investment, % | 18.3 | 19.5 |
| Equity ratio, % | 52.4 | 52.4 |
| Gross investments in tangible and intangible assets, EUR 1,0001) | 558 | 740 |
| Gross investments in tangible and intangible assets, as % of net sales | 0.6 | 0.9 |
| Capitalisations according to IAS 38 to intangible assets, EUR 1,000 | 5,176 | 4,720 |
| Research and development expenditure, EUR 1,000 | 20,299 | 16,791 |
|
Research and development expenditure, as % of net sales |
20.8 | 19.6 |
| Order backlog, EUR 1,000 | 66,344 | 55,213 |
| Average number of employees during the period | 723 | 665 |
| Interest-bearing net liabilities, EUR 1,000 | 4,137 | -1,789 |
| Gearing ratio, % | 11.1 | -5.4 |
1) The figure does not include investments in development projects.
| Per share data |
1 Jan – 31 Dec 2015 |
1 Jan – 31 Dec 2014 |
| Earnings per share (EPS), EUR | 0.04 | 0.05 |
| EPS diluted, EUR | 0.04 | 0.05 |
| Equity per share, EUR | 0.34 | 0.31 |
| Dividend per share, EUR | 0.03 | 0.02 |
| Dividend per earnings, % | 72.7 | 39.5 |
| Effective dividend yield, % | 1.6 | 2.0 |
| P/E ratio | 43.4 | 19.4 |
| Adjusted number of shares at the end of the period | 108,395,409 | 107,421,270 |
| of which the number of treasury shares | 118,507 | 464,739 |
| Outstanding shares | 108,276,902 | 106,956,531 |
| Adjusted average number of shares during the period | 107,370,551 | 107,284,900 |
| Average number of shares, dilution included | 109,640,245 | 107,625,526 |
10. Definition of key figures
| Operating margin % | = | Operating profit/loss | x100 |
| Net sales | |||
| Profit margin (before income taxes) % | = | Profit/loss before taxes | x100 |
| Net sales | |||
| Return on equity % (ROE) | = | Profit/loss | x100 |
| Total equity (average during year) | |||
| Return on investment % (ROI) | = | Profit/loss before taxes + financial expenses | x100 |
| Total equity + interest bearing liabilities (average during the year) | |||
| Equity ratio % | = | Total equity | x100 |
| Statement of financial position total – advances received | |||
| Gross investments in tangible and intangible assets, as % of net sales | = | Gross investments in tangible and intangible assets | x100 |
| Net sales | |||
| Research and development expenditure, as % of net sales | = | Research and development expenditure | x100 |
| Net sales | |||
| Gearing ratio % | = | Interest-bearing liabilities – cash and cash equivalents | x100 |
| Total equity | |||
| Earnings per share (EPS) | = | Profit/loss for the financial year attributable to equity shareholders | |
| Average number of outstanding shares for the financial year | |||
| Equity per share | = | Equity attributable to the equity holders of the parent company | |
| Adjusted number of shares at the end of period | |||
| Dividend per share | = | Dividend | |
| Adjusted number of shares at the end of period | |||
| Dividend per earnings % | = | Dividend per share | x100 |
| Earnings per share (EPS) | |||
| Effective dividend yield % | = | Dividend per share | x100 |
| Share closing price at end of period | |||
| P/E ratio | = | Share closing price at end of period | |
| Earnings per share (EPS) | |||