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secunet after the Third Quarter 2008: Strong growth rate, high volume of orders
- Continued strong growth in sales (+ 22%)
- High expenses for project preparations have negative impact on results
- Volume of orders increases by 18 percent with respect to previous quarter
- Outlook for the whole year: Confirmation of the sales forecast, results will depend on Q4
secunet Security Networks AG, a leading European provider of solutions and products for IT security and high security, has continued its strong growth in sales in Q3-2008. With this, secunet was able to achieve a 22 percent increase in the net sales amounting to Euro 33.2 million in the first nine months of 2008. With high capacity utilisation, the volume of orders in the third quarter has gone up by 18 percent. The expenses in preparation for large projects have however brought down the results. The Board of Directors of the company has therefore corroborated its outlook for the sales in 2008. The results forecast will depend to a large extent on the fourth quarter.
The corporate turnover of secunet Security Networks AG increased from Euro 27.1 million in the first nine months of 2007 by 22 percent to Euro 33.2 million in the current year. The main growth driver continues to be the business division High Security, which provides the high security technology SINA. Here the sales went up by 60 percent compared to the previous year.
The trends in the expense positions have been different compared to the first nine months of 2007. Depreciations have decreased by 4 percent.
Personnel costs have gone up inordinately compared to the sales, by 6 percent. The other operating expenses have increased by 18 percent over the previous year in the first nine months of 2008, mainly as a result of the increase in the sales activities.
The expenses on materials and services availed went up significantly by 73 percent in the first nine months of 2008 as against the previous year. This expense position is influenced on one hand by the hardware services in connection with the growing SINA business and on the other hand, by expenses for external services. This is because secunet had to fall back on the services of external providers to deal with capacity crunches and to make up for the employees who were taken out from the productive sector and engaged in project preparations.
On the whole, the expenses in the secunet Group went up by 26 percent from Euro 26.7 million in the period from January to September 2007 to Euro 33.6 million in the current year, this is disproportionately high when we look at the turnover. As a consequence, the earnings before interests and taxes (EBIT) in the first nine months of 2008 receded in comparison with the previous year: compared with Euro 1.0 million for the same period in the preceding year, Euro 0.3 million were achieved this year, recording a decrease of 68 percent. After taxation the surplus for the period for the first nine months of 2008 was Euro 0.55 million, as against Euro 0.52 million in the previous year. The earnings per share remain unchanged, at Euro. 0.08 The cash flow from business operations was negative owing to the drop in reserves and liabilities as well as in the build up of receivables in the first nine months. The cash flows from the investments and financing activity have had only a small impact. On the whole, the level of cash and cash equivalents in the secunet Group went down by Euro 3.4 million in the first nine months of 2008 by, against a reduction of Euro 4.0 million in the previous year.
With the continued high utilisation of capacities, which is reflected in the sales figures, the volume of orders has gone up significantly: As on 30th September 2008 it amounted to Euro 22.2 million, a plus of 18 percent over the status at the end of June 2008.
"This year, we have won orders for the execution of several large IT security projects, and have thereby secured growth in our revenues over long term", commented Dr. Rainer Baumgart, CEO of secunet Security Networks AG. "The high expenses incurred for successful sales and marketing and by the preparations for these important projects have no doubt had a negative impact on the current financial year, but will pay off in future."
Based on the development of business after the first nine months of 2008, the Executive Board of secunet Security Networks AG has confirmed its expectations of a two-digit increase in sales compared to the previous year. The annual results, like in the previous years, will be determined to a large extent by the developments in the fourth quarter of 2008.
The 9-Month-Report of secunet Security Networks AG is available at http://www.secunet.com/finanzberichte.html?&L=3.
This press release contains prospective statements. Prospective statements are statements which do not describe actual facts from the past; they also comprise of statements about our suppositions and expectations. Every statement in this press release which reflects our intentions, suppositions, expectations or forecasts (together with the suppositions which give rise to such views) constitutes a prospective statement. These statements refer to plans, estimates and forecasts which the management of secunet Security Networks AG currently dispose of. Thus prospective statements only refer to the day on which they were made. We shall accept no obligation to further develop such statements in the light of new information or future results.
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