F-Secure has prepared the opening IFRS balance sheet at the date
of transition to IFRS, which is 1st January 2004 as well as
comparative data of year 2004. The 2005 interim reports will be
prepared in accordance with IAS 34.
The change in accounting standards affects the following
principles:
Research and development costs
Research costs are expensed as incurred. Development
expenditures incurred on individual projects of totally new product
or product versions with significant new features are carried
forward when meeting IAS 38 requirements. The Group has already
applied this in 2004 FAS closing.
Share based payments
According to IFRS 2 warrants granted to employees must be
recognize at fair value and present in financial statement.
Financial instruments
IAS 39 classifies financial assets in four components: financial
asset at fair value through profit or loss, held-to-maturity, loans
and receivables originated by the enterprise and available-for-sale
financial asset. F-Secure has recognized marketable securities as
available-for-sale financial asset and measured it at its fair
value. Fair value adjustment has been booked under revaluation
reserve in equity.
The differences between cash flow statement according to IFRS
and FAS are not material.
Comparative data (unaudited)
Euro million
Income statement FAS IFRS
2004 Chge 2004
Revenues 47.3 47.3
Cost of revenues 3.7 3.7
Gross margin 43.5 43.5
Other operating income 0.9 0.9
Sales and marketing 4) 24.4 0.2 24.6
Research and development 4) 10.7 0.1 10.7
Administration 4) 2.6 0.1 2.7
Operating result 6.8 6.5
Financial net 1.2 1.2
Result before taxes 7.9 7.7
Extraordinary items 5) -0.5 0.5 0.0
Income taxes 6.0 5.8
Result for the period 13.4 13.5
Earning per share basic 0.09 0.09
Earning per share diluted 0.09 0.09
BALANCE SHEET FAS IFRS FAS IFRS
31/12 31/12 31/12 31/12
ASSETS 2004 chge 2004 2003 chge 2003
Non-current
Intangible assets 1) 2.6 -0.2 2.4 0.9 -0,2 0.7
Tangible assets 1) 1.5 0.2 1.7 1.2 0.2 1.4
Deferred tax asset 6.4 6.4 0.2 0.2
Other financial assets 2) 0.3 -0.1 0.2 0.7 -0.1 0.6
Current
Trade and other
receivables 11.2 11.2 11.6 0.2 11.8
Available-for-sale
financial assets 2) 41.4 0.9 42.4 33.6 0.2 33.9
Cash and bank accounts 7.8 7.8 5.9 5.9
Total 71.3 0.8 72.1 53.9 0.5 54.4
SHAREHOLDERS’ EQUITY
AND LIABILITIES
Equity
Share capital 1.5 1.5 1.5 1.5
Share premium 3) 31.0 -2.4 28.6 56.9 -2.4 54.5
Retained earnings 2-5) 12.2 3.0 15.2 -28.1 2.2 -26.0
Non-current liabilities
Deferred tax
liabilities 2) 0.2 0.2 0.1 0.1
Provisions 0.2 0.2 0.2 0.2
Deferred revenues 2.7 2.7 2.1 2.1
Current liabilities
Other current 5) 8.1 8.1 8.3 0.7 9.0
Deferred revenues 15.7 15.7 13.0 13.0
Total 71.3 0.8 72.1 53.9 0.5 54.4
Statement of changes in shareholders’ equity
share
share premium transl. reval. retained
capital fund diff. reserve earnings total
Equity on
31.13.2003 1.5 56.9 0.0 -28.1 30.2
Effect of
adopting IFRS -2.4 0.1 2.1 -0.3
Restated equity
on 1.1.2004 1.5 54.5 0.0 0.1 -26.0 30.0
Available-for-sale
financial asset, net 0.4 0.4
Translation diff. 0.0 0.0
Cost of share
based payments 0.3 0.3
Profit 13.5 13.5
Exercise of options 0.0 1.0 1.0
Other change -26.9 26.9 0.0
Equity on
31.12.2004 1.5 28.6 0.0 0.5 14.7 45.2
Key ratios FAS IFRS
2004 2004
Operating result,
% of revenues 14.4 13.8
ROI, % 22.1 21.3
ROE, % 36.7 35.9
Equity ratio, % 84.4 84.2
Debt-to-equity ratio, % -110.3 -110.7
Shareholders' equity
per share 0.30 0.30
P/E ratio 19.5 19.8
Investments (Meuro) 2.9 2.9
Contingent liabilities (Me)* 14.6 14.6
Personnel, average 291 291
Personnel, Dec 31 306 306
Quarterly development
FAS IFRS
1/04 2/04 3/04 4/04 1/04 2/04 3/04 4/04
Revenues 5) 10.5 11.7 12.5 12.6 10.4 11.6 12.8 12.6
Cost of revenues 0.8 1.0 1.0 1.0 0.8 1.0 1.0 1.0
Gross margin 9.7 10.7 11.5 11.6 9.6 10.6 11.8 11.6
Other operating
income 0.2 0.2 0.2 0.3 0.2 0.2 0.2 0.3
Sales and marketing 6.0 6.0 5.9 6.5 6.0 6.0 5.9 6.6
Research and
development 2.4 2.6 2.8 2.8 2.4 2.6 2.7 3.0
Administration 0.7 0.6 0.6 0.8 0.7 0.6 0.6 0.8
Operating result 0.8 1.7 2.5 1.8 0.7 1.5 2.7 1.6
Financial net 0.4 0.1 0.3 0.4 0.4 0.1 0.3 0.4
Result before taxes 1.2 1.8 2.8 2.2 1.0 1.7 3.0 2.0
Notes to the comparative data:
1) The Group has redefined intangible and tangible assets
according to IAS 16.
2) IAS 39 classifies financial assets in four components:
financial asset at fair value through profit or loss,
held-to-maturity, loans and receivables originated by the
enterprise and available-for-sale. F-Secure has recognized
marketable securities as available-for-sale financial asset and
measured it at their fair value adjusted by deferred tax liability.
Fair value adjustment has been booked under revaluation reserve in
equity.
3) The transaction costs of an equity transaction in year 1999
listing are accounted for as a deduction from equity, net of any
related income tax benefit (SIC-17).
4) IFRS 2 requires expensing of employees share options at their
fair value by using option-pricing model. The Group has applied
IFRS 2 only to equity-settled awards granted after 7 November 2002
that had not vested on or before 1 January 2005. IFRS 2 has no
effect on starting balance 1.1.2004.
5) Nokia OEM refunded royalty has been adjusted to the
comparative data so that previous years are shown in opening
balance and year 2004 quarterly basis in revenue.
F-Secure Corporation
Risto Siilasmaa
President and CEO
Additional information:
F-Secure Corporation
Risto Siilasmaa, President and
CEO
tel.358 9 2520 5510
Taneli Virtanen,
CFO
tel.358 9 2520 5655
