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January 26, 2010 Basware Financial Results Q4/2009 and full year 2009 CEO Ilkka Sihvo and CFO Mika Harjuaho 1.

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Presentation on theme: "January 26, 2010 Basware Financial Results Q4/2009 and full year 2009 CEO Ilkka Sihvo and CFO Mika Harjuaho 1."— Presentation transcript:

1 January 26, 2010 Basware Financial Results Q4/2009 and full year 2009 CEO Ilkka Sihvo and CFO Mika Harjuaho 1

2 Contents 2 Q4/2009 in Brief 1-12/2009 in Brief Business Review of Q4/2009 Financial Review of Q4/2009 Financial Review of 1-12/2009 Future Outlook

3 Basware in Brief 3 Headquarters in Espoo, Finland and altogether 10 subsidiaries in Europe, in the US and Asia-Pacific Approximately users globally in large organizations Net sales thousand at the end of December 2009 ( thousand) 761 employees at the end of December 2009 (731) Breakthrough to Global Leader

4 Q4/2009 in Brief 4 EUR MillionQ4/2009Q4/2008 Net sales Growth of net sales, %1.2%13.4% Operating profit (EBIT)4.1 Change of operating profit %-1.6%114.2% % of net sales15.3%15.7% Net profit/loss Earnings per share, euro Growth of EPS %24.0% Fixed costs International operations’ share of net sales 53.9%51.4% Resellers’ share of product sales 11.1%14.9% Personnel Excellent performance in recession Operating profit over 15 percent and at the last year’s level Growth of EPS 24.0 percent Fixed costs tightly managed Automation Services grew strongly by 162.3% Maintenance grew by 13.3% International operations’ share of net sales continued to grow, growth 6.0% Major deals in North America in Q4

5 1-12/2009 in Brief 5 EUR Million1-12/091-12/08 Net sales Growth of net sales, %7.6%17.5% Operating profit (EBIT) Change of operating profit %36.2%15.5% % of net sales12.8%10.1% Net profit/loss Cash flow from operating activities Earnings per share, euro Growh of EPS %41.3% Fixed costs International operations’ share of net sales 54.2%51.8% Resellers’ share of product sales 9.9%15.7% Personnel Excellent performance in recession Record-high profitability EUR 11.8 M and at 12.8%, growth 36.2% Growth of EPS 41.3% Growth of net sales 7.6% Strong operating cash flow at EUR 14.7 M Automation Services grew by 72.0% Maintenance grew by 18.7% International operations’ share of net sales continued to grow, growth 12.6% Order backlog EUR 14.6 Million, several new large Automation Services deals

6 Highlights of Q4/ Large Scan and Capture deal in North America in health care sector Major Connectivity deal with Veolia Environmental Services in UK Large Invoice Automation deals in North America in energy, retail and health care sectors Basware strategy update for Connectivity and Basware Invoice Processing solution deal to one of the world's largest manufacturers of building materials Growth of Automation Services 162.3%

7 7 Business Review of Q4/2009 CEO Ilkka Sihvo

8 2010 market estimate up-dates Estimates made at the end of 2009 USAWestern and Central Europe 2010 Software market9.2% 5.5% IT market total6.6% 4.0% 8

9 Reporting 9 Finland Finnish, Russian, Asia-Pacific (excl. Australia) and headquarter operations Scandinavia Denmark, Norway and Sweden Europe France, Germany, The Netherlands, UK Other North-America, Australia License sales Enterprise Purchase to Pay and Financial Management Software Professional Services Maintenance Automation Services SaaS Connectivity (e-invoicing, Scan&Capture)

10 Segment: Finland Q4/

11 Segment: Finland Q4/ New deals with e.g. Fenet Oy, Parmarine Oy, Euteller Oy, Nurmijärven Sähkö Oy, UB Securitas Oy (United Bankers) Highlights Strong results in economic downturn Successful scan and capture launch in Finland, large deals Profile Segment consists of Finnish, Russian, Asia- Pacific (excluding Australia) operations and head quarter functions Altogether 14 resellers in the segment Number of personnel 460 (426)

12 Segment: Scandinavia Q4/

13 Segment: Scandinavia Q4/ Profile Centrally managed units in Sweden, Norway and Denmark The segment sells Enterprise Purchase to Pay solutions Mainly direct sales Number of personnel 130 (146) Highlights and New deals with e.g. Public sector breakthrough in Denmark Folketinget Arctic Securities Tun Media AS Norges vassdrags- og energidirektorat Rieber & Son

14 Segment: Europe Q4/

15 Segment: Europe Q4/ Profile Segment consists of units in Germany, France, The Netherlands and UK Segment sells Enterprise Purchase to Pay solutions Altogether 35 resellers in the segment Number of personnel 119 (127) Highlights and new deals with e.g. Successful Connectivity launch in UK Major Connectivity deal with Veolia Environmental Services in UK ABB Egypt and SaudiArabia

16 Segment: Other Q4/

17 Segment: Other Q4/ Large Invoice Automation deals in North America in energy, retail and health care sectors Large Scan and Capture deal in North America in health care sector Highlights and new deals Profile Segment consists units in North-America and Australia Altogether 10 resellers in the segment Number of personnel 48 (29)

18 Basware Automation Services 18 Business Transactions: enables delivery of e-invoices and purchase messages between buyers and suppliers Scan and Capture: converts paper invoices into electronic format Basware Supplier Portal: enables suppliers to create einvoices and to handle purchase messages and catalogues Basware Supplier Activation service: enables buyers to convert suppliers’ paper invoices into electronic invoices Basware Connectivity Services

19 Basware Connectivity is a new set of services which enable suppliers and buyers of all sizes and maturity to transact electronically Launched on the markets early 2009, clear demand for the solution New customers in all important markets including North America Basware strong player in connectivity markets Competitors local or small by transaction volumes Major success in 2009 extending Basware’s competitiveness and ensuring recurring revenue stream 19

20 20 Financial Review of Q4/2009 and 1-12/2009 CFO Mika Harjuaho

21 Key Financials tEUR

22 Q4/2009 and 1-12/2009 in Brief 22

23 Development of Quarterly Net Sales 23

24 Development of Quarterly profit 24

25 Net Sales by Operation Q4/ Licenses = License sales of software products Professional Services = Former consulting, includes also Maintenance and Automation Services related consulting Maintenance = Continuous, annually charged fees (18-20% of license sales) Automation Services = Software as a Service, einvoicing, scan and capture Maintenance, growth of 13.3% License sales, decrease of 4.1% Automation Services, growth of 162.3% Professional Services, decrease of 18.0%

26 Net Sales by Operation Licenses = License sales of software products Professional Services = Former consulting, includes also Maintenance and Automation Services related consulting Maintenance = Continuous, annually charged fees (18-20% of license sales) Automation Services = Software as a Service, einvoicing, scan and capture Maintenance, growth of 18.7% License sales, decrease of 8.1% Automation Services, growth of 72.0% Professional Services, growth of 2.1%

27 Net Sales by Primary Segment Q4/

28 Operating Profit by Primary Segment Q4/ Cumulative correction for transfer pricing model in H2. Relates to acquired business in Australia in Q3/2009.

29 Net Sales by Primary Segment 1-12/

30 Operating profit by Primary Segment 1-12/

31 Development of Profit Q4/2009 and 1-12/

32 Products R&D expenses EUR thousand (EUR thousand) - Decrease of 4.7 percent percent of net sales (18.0%) - EUR thousand of costs capitalized i.e. 9.8% Products unit personnel 195 (171) - Units in Finland and India - Future recruitments in India 32 R&D expenses 16.0% of net sales 25.6% of personnel

33 Personnel In total 761 (731) employees at the end of December percent abroad Average age 36.6 years 33 EducationPersonnel groups

34 Finance and Investments Total assets on the balance sheet EUR thousand (EUR thousand) Cash and cash equivalents EUR thousand (EUR thousand) Cash flow from operations EUR thousand (EUR thousand) Equity ratio 64.8% (59.5%) Gearing -5.3% (9.3%) Total gross investments EUR thousand (EUR thousand) - Includes capitalized R&D costs and acquisitions

35 Share and Shareholders Number of shareholders (17 120) at the end of December 2009 Share price development during January–December 2009: - Average price of the share EUR (EUR 7.53) - Highest EUR (EUR 10.45), lowest EUR 6.60 (EUR 6.00) - Closing price EUR (EUR 6.59) Traded shares ( ) % (20.1%) of all shares Market capitalization EUR (EUR ) Basware’s Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.36 per share (2008: EUR 0.23) be paid for 2009.

36 36 Future Outlook CEO Ilkka Sihvo

37 Industry and Basware Outlook 2010 Uncertainty in world economy - Market forecasts updated towards the end of 2009 expect the software market to increase by 9.2 percent in 2010 in the United States and by 5.5 percent in Western and Central Europe. - The entire IT market is expected to grow by 6.6 percent in the United States and by 4.0 percent in Western and Central Europe in Competitive position strong, Automation Services supporting overall product offering. The company's long-term target is to grow annually more than 50% in SaaS, Connectivity Services and e-invoicing. Target is to become one of the leading e-invoicing companies in the world. A program to invest in the growth of Basware Automation Services (SaaS, e- invoicing service and Scan and Capture) has been initiated as of the beginning of 2010 Automation Services order backlog: EUR thousand

38 Industry and Basware Outlook 2010 Strategic growth markets are North America, Germany, UK and France based on market size and opportunities. In Finland and Scandinavia, the focus is on profitability, and moderate growth is supported by the company's expanded product portfolio and the development of the service business. The number of the Group's personnel will increase mainly in Automation Services and R&D activities during the year. The number of personnel will increase the most in India, which will enable growth with a more moderate increase in costs. Additional investments required by growth will be moderately realized, provided that net sales and profitability have realized in accordance with expectations. Review of acquisition possibilities continues: Automation Services, distribution channel and product portfolio Basware expects its net sales to develop positively on the level of Operating profit (EBIT) for 2010 is expected to be from 10 to 15 percent of net sales. 38

39 Next interim report on April 15, 2010 Analyst and press briefing takes place on April 15, 2010 at in Hotel Kämp, Pohjoisesplanadi 29, Helsinki, Finland. Welcome!


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