WithSecure Corporation, Stock Exchange Release, 16 May 2022, at 8:00 EEST

WithSecure publishes restated financial information for its continuing operations for 2021

As announced in a stock exchange release on 17 February 2022, the Board of Directors of WithSecure Corporation (“WithSecure”) decided to pursue towards the separation of the Consumer Security business through a partial demerger (the “Demerger”), whereby WithSecure’s Consumer Security business would be transferred into a new independent company, to be named F-Secure Corporation (“F-Secure”), whereas the renamed WithSecure Corporation would carry on the Corporate Security business. The demerger is subject to an approval by an Extraordinary General Meeting of 31 May. The planned completion date of the demerger is 30 June 2022.

Reflecting the progress of the demerger plans, WithSecure presents consumer security business as Discontinued operations under IFRS 5 from first quarter of 2022.

WithSecure publishes restated quarterly financial information on its 2021 financials. These financials constitute comparative information for WithSecure Corporation when Consumer Security business ("F-Secure") is presented as discontinued operations. Financial information for discontinued operations does not reflect future F-Secure's profitability on a stand-alone basis.

Under IFRS 5, the result from discontinued operations is reported separately from continuing operations’ income and expenses in the consolidated income statement. Comparative periods are restated accordingly. The statement of financial position is not restated.

Discontinued operations include revenue and operating expenses directly related to Consumer Security business and discontinued for continuing business after the demerger. Certain costs related to supporting F-Secure during transition period and costs of premises which will be sub-leased to F-Secure are not included in Discontinued operations. To improve comparability between periods, Estimated comparable EBITDA has been added as alternative performance measure. Presentation of WithSecure and F-Secure in accordance with IFRS 5 does not reflect profitability of either continuing or discontinued business on a stand-alone basis prior to the demerger.

The restated financial information is unaudited.

Restated income statement, continuing operations (WithSecure)

 Restated
Income statement1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Revenue31,531,932,134,5130,0
Cost of revenue-10,1-10,2-10,1-11,1-41,5
Gross margin21,421,722,023,488,5
Other operating income0,40,40,31,32,5
Sales and marketing-17,4-18,7-17,6-19,6-73,3
Research and development-7,3-7,7-7,7-9,3-32,1
Administration-3,3-4,3-3,1-5,0-15,7
EBIT-6,3-8,6-6,1-9,2-30,1
Financial net0,3-0,4-0,20,0-0,3
Result before taxes-6,0-9,0-6,3-9,2-30,5
Income taxes0,91,61,31,35,0
Result for the period-5,1-7,5-5,0-7,9-25,5
      
Other comprehensive income     
Exchange differences on translating foreign operations4,4-0,1-1,00,63,9
Total comprehensive income (parent company owners)-0,7-7,6-6,0-7,3-21,6

Restated income statement, discontinued operations (F-Secure)

 Restated
Income statement1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Revenue26,326,326,527,1106,3
Cost of revenue-2,1-2,1-2,3-2,6-9,1
Gross margin24,124,324,324,597,2
Other operating income0,00,10,10,20,3
Sales and marketing-6,3-6,7-6,2-6,8-25,9
Research and development-3,7-3,5-3,3-4,0-14,5
Administration-1,8-3,2-1,6-2,6-9,3
EBIT12,410,913,311,247,8
Financial net0,00,10,00,00,1
Result before taxes12,411,113,211,247,9
Income taxes-2,4-2,2-2,6-2,5-9,8
Result for the period10,08,910,68,738,2
      
Other comprehensive income     
Exchange differences on translating foreign operations0,00,0-0,10,10,1
Total comprehensive income (parent company owners)10,08,910,58,838,3

Restated cash flows, discontinued operations (F-Secure)

 Restated
Cash flow1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Net cash flow from operating activities5,513,27,014,440,2
Net cash flow from investing activities-0,2-0,5-0,4-0,6-1,6
Net cash flow from financing activities0,00,0-0,10,0-0,2

Restated disaggregation of revenue, continuing operations (WithSecure)

 Restated
By sales channels1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Corporate security     
Cloud-native solutions11,812,713,514,752,7
On-premise solutions7,77,57,47,430,0
Cyber security consulting12,011,611,212,447,2
Total revenue31,531,932,134,5130,0
 

 
     
 Restated
By geographical area1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Nordic countries10,210,28,911,040,3
Rest of Europe13,413,813,714,255,1
North America2,22,13,02,710,0
Rest of the world5,65,76,76,624,6
Total revenue31,531,932,134,5130,0

Restated disaggregation of revenue, discontinued operations (F-Secure)

 Restated
By sales channels1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Consumer security     
Partner channel20,820,821,021,684,2
Direct channel (E-commerce)5,55,55,55,522,1
Total revenue26,326,326,527,1106,3
      
 Restated
By geographical area1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Nordic countries9,19,19,39,436,9
Rest of Europe12,612,412,312,549,6
North America3,43,63,73,814,6
Rest of the world1,21,21,31,45,2
Total revenue26,326,326,527,1106,3

Alternative performance measures

WithSecure has included certain non-IFRS based alternative performance measures (APM). Alternative performance measures are provided to reflect the underlying business performance, and to exclude certain non-operational or non-cash valuation items affecting comparability (IAC). The aim is to improve comparability, and alternative performance measures should not be regarded as substitutes for IFRS based measures. Alternative performance measures include EBITDA, adjusted EBITDA, estimated comparable EBITDA and adjusted EBIT. Depreciations, amortization and impairments are excluded from EBITDA. Also, the adjusted EBITDA and adjusted EBIT exclude IACs which are material items outside the normal course of business. These items are associated with acquisitions, integration costs, gains and losses from the sale of businesses and other items affecting comparability.

Presentation of WithSecure and F-Secure in accordance with IFRS 5 standard does not reflect profitability of either business on a stand-alone basis. Estimated comparable EBITDA is presented as APM for profitability to improve comparability between periods. Estimated comparable EBITDA excludes (for Discontinued operations: includes) activities related to research and development, and cost of facilities held by WithSecure.

  

Restated reconciliation of alternative performance measures, continuing operations (WithSecure)

 Restated
EBITDA1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Estimated comparable EBITDA-1,5-4,0-1,6-4,1-11,3
Adjustments to adjusted EBITDA     
Research and development-1,2-1,1-1,1-0,9-4,4
Facilities held by WithSecure-0,4-0,4-0,4-0,4-1,6
Adjusted EBITDA-3,2-5,5-3,1-5,5-17,2
Adjustments to EBITDA     
Divestments   0,50,5
Strategy     
EBITDA-3,2-5,5-3,1-4,9-16,7
Depreciation, amortization and impairment losses-3,1-3,1-3,0-4,3-13,4
EBIT-6,3-8,6-6,1-9,2-30,1
      
 Restated
EBIT1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Adjusted EBIT-5,5-7,8-5,4-8,0-26,8
Adjustments to EBIT     
PPA amortization-0,8-0,7-0,7-0,7-2,8
Impairment   -1,0-1,0
Divestments   0,50,5
Strategy     
EBIT-6,3-8,6-6,1-9,2-30,1

Restated reconciliation of alternative performance measures, discontinued operations (F-Secure)

 Restated
EBITDA1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Estimated comparable EBITDA11,212,212,611,947,8
Adjustments to adjusted EBITDA     
Research and development1,21,11,10,94,4
Facilities held by WithSecure0,40,40,40,41,6
Adjusted EBITDA12,813,714,113,253,7
Adjustments to EBITDA     
Strategy -2,3-0,4-1,5-4,3
EBITDA12,811,413,711,649,5
Depreciation, amortization and impairment losses-0,4-0,4-0,4-0,4-1,6
EBIT12,410,913,311,247,8
 

  		     
 Restated
EBIT1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Adjusted EBIT12,413,213,712,752,1
Adjustments to EBIT     
Strategy -2,3-0,4-1,5-4,3
EBIT12,410,913,311,247,8

Restated key ratios and other key figures, continuing operations (WithSecure)

 Restated
Profitability1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Revenue31,531,932,134,5130,0
Cloud-native corporate security solutions11,812,713,514,752,7
On-premise corporate security solutions7,77,57,47,430,0
Cyber security consulting12,011,611,212,447,2
Gross margin21,421,722,023,488,5
Gross margin, % of revenue68,0%68,1%68,5%67,8%68,1%
Operating expenses-28,0-30,7-28,4-33,9-121,0
Operating expenses for adjusted EBITDA-24,9-27,6-25,4-29,6-107,6
Adjustment to other income   0,50,5
Adjusted EBITDA-3,2-5,5-3,1-5,5-17,2
Adjusted EBITDA, % of revenue-10,1%-17,3%-9,6%-15,8%-13,3%
EBITDA-3,2-5,5-3,1-4,9-16,7
EBITDA, % of revenue-10,1%-17,3%-9,6%-14,2%-12,8%
Adjusted EBIT-5,5-7,8-5,4-8,0-26,8
Adjusted EBIT, % of revenue-17,6%-24,6%-16,8%-23,2%-20,6%
EBIT-6,3-8,6-6,1-9,2-30,1
EBIT, % of revenue-20,0%-26,9%-18,9%-26,6%-23,2%
Estimated combarable EBITDA-1,5-4,0-1,6-4,1-11,3
Estimated combarable EBITDA, % of revenue-4,9%-12,6%-5,0%-12,0%-8,7%

Restated key ratios and other key figures, discontinued operations (F-Secure)

 Restated
Profitability1-3/2021
4-6/2021
7-9/2021
10-12/2021
1-12/2021
Revenue26,326,326,527,1106,3
Partner channel20,820,821,021,684,2
Direct channel (e-commerce)5,55,55,55,522,1
Adjusted EBITDA12,813,714,113,253,7
% of revenue48,7 %51,9 %53,0 %48,6 %50,6 %
EBIT12,410,913,311,247,8
EBIT, % of revenue47,3 %41,6 %50,0 %41,3 %45,0 %
Estimated combarable EBITDA11,212,212,611,947,8
Estimated combarable EBITDA, % of revenue42,6 %46,2 %47,5 %43,7 %45,0 %

Calculation of key figures

Equity ratio, % Total equity      
  Total assets – deferred revenue    
         
ROI, % Result before taxes + financial expenses (annualized)  
  Total assets - non-interest bearing liabilities (average)  
         
ROE, % Result for the period (annualized)    
  Total equity (average)      
         
Gearing, % Interest bearing liabilities - cash and bank and financial asset through profit and loss
  Total equity

  		     
Earnings per share, EUR Profit attributable to equity holders of the company  
  Weighted average number of outstanding shares    
         
Shareholders' equity per share, EUR Equity attributable to equity holders of the company  
  Number of outstanding shares at the end of period    
         
Operating Expenses Sales and marketing, research and development, and administration costs  
         
EBITDA EBIT + Depreciation, amortization and impairment    
         
EBITA EBIT + Amortization and impairment    

Contact information:

Laura Viita, Investor Relations Director, WithSecure Corporation
+358 50 487 1044
investor-relations@withsecure.com

Attachment

  • IFRS5 restatement ENG