Anders Lidbeck, President and CEO
July 22, 2014
Financial results Q214
Agenda
Enea Intro
Enea Financials Q214
Way Forward & Outlook
2
Enea is Powering
the Wireless Broadband
R&D OPEX
INVESTMENT
22.1PERCENT
REVENUE
408.5MSEK
NO. OF
EMPLOYEES
387
The market for wireless communication is
expanding rapidly.
Enea is global software company with high
operating profit margins and a large R&D
investment.
Enea already holds a world-leading position
on this market with proven high-performance
solutions.
Networks based on Enea’s Operating Systems
currently serve more than 3 billion wireless
subscribers globally (2014). (Ericsson Mobility
Report, June 2014).
Powering the Wireless Broadband
(2013 numbers)
OPERATING
PROFIT
20.1PERCENT
3
Leading Customers
4
Q214
Financials
5
Improved EBIT & EPS
6
Q214 Q213
EBIT (MSEK): 22.7 22.0
Operating margin (%) 21.9 20.8
Earnings per share (SEK) 1.09 1.04
1H14 1H13
EBIT (MSEK): 40.7 36.0
Operating margin (%) 19.9 17.5
Earnings per share (SEK) 1.98 1.74
Firm Revenues
Q214 Q213
Revenue (MSEK): 104.0 105.7
Growth (%) -1.7 -12.3
Growth (%) (excl. currency effects) -2.2 -9.6
7
1H14 1H13
Revenue (MSEK): 205.0 205.1
Growth (%) -0.1 -13.8
Growth (%) (excl. currency effects) -0.2 -11.5
Recurring Revenues more than 90%
8
Revenues from term-based
development licenses, including
support and maintenance, fell
slightly compared with the
same quarter last year.
Revenues from perpetual
licenses remained unchanged.
Revenues from production
licenses (royalties), remained
unchanged during the quarter
but is slightly lower than
anticipated from a few
customers.
Important Contracts in Different Segments
9
In Europe, a three year term contract
was signed with a major customer
developing Industrial Security
Systems. The customer will be using
Enea OSE in its products.
In North America, a Bridged Services
contract was signed with a leading
supplier of medical equipment. This
contract is worth SEK 12 million.
A significant OSE licensing one year
term agreement was renewed with
an existing Telco customer in Japan.
Global Business
10
Revenue per Product
11
Double Digit Growth in Global Services
12
14% y-o-y growth in Global Services
revenues.
The Services operation in North America
extended a contract worth SEK 17 million
with a large avionics company.
In North America, a Bridged Services
contract was signed with a leading supplier
of medical equipment. This contract is
worth SEK 12 million.
New contract signed with Aero/Defence
customer in the US
New revenues in Germany adding to the
growth
Strong Financial Position
Cash flow from operations amounted to
36.8 (36.2) MSEK.
Cash and cash equivalents and financial
investments at the end of the quarter were
172.2 (175.1) MSEK.
Enea has unused credits of 15 MSEK.
The equity ratio was 77.7 (81.8)%.
13
MSEK
Dividend
Policy; at least 30 percent of profit after tax should be transferred to shareholders.
The Board proposed transferring an amount equivalent to SEK 3.00 (3.00) per share to shareholders.
This is equivalent to a transfer amounting to SEK 49.1 (49.4) million.
Dividend to be executed in the form of an automatic redemption program.
Approved at the Annual General Meeting in Kista, Sweden April 24.
The final date for trade, including the right to redemption shares, 30 April
The share split record date, including the right to redemption shares, 6 May
Trading in redemption shares took place between 8 May and 21 May
The redemption price was paid on 30 May
14
Way Forward
& Outlook
15
Over 20% Investment
in R&D
(22.6% in Q214)
Enea is Powering
the Wireless Broadband16
Product Highlights from Q2
New releases of all our major product lines:
• Version 4.0 of the Enea Linux distribution
• Version 3.4 of Enea Element middleware platform
• Version 5.7.2 of the OSE real-time operating system
New strategic partnership with Linux Foundation:
• As one of four training partners world wide, Enea will provide
Linux Foundation’s courses in embedded Linux
New platforms that leverage the existing portfolio:
• The OSE Compatibility Platform will allow customers to run OSE applications on top of
Enea Linux.
• The System-on-Chip (SoC) platform which integrates
Enea Linux with the OSEck operating system is now
available for Texas Instrument’s “Keystone” devices
17
• Enea Linux 4.0
Yocto based embedded
Linux distributions
Linaro – the ARM
open source community
Hardware independent
Linux distributions
Virtualization
IP communication
Real-time capabilities
18
19
Long Term Ambition
Enea’s ambition during five years, starting 2012, is to create
a global software company with significantly higher
revenues, high profitability, good cash flows and a large
proportion of recurring revenues.
Enea will be focusing on organic growth, but both strategic
and complementary acquisitions will be evaluated regularly.
Growth will vary over the years and between the quarters,
depending on when individual deals take place and the
development of royalty revenue streams which are
dependent on customers’ sales volumes.
The operating margin will vary in line with growth over the
various quarters of the period. Our objective during this five
year period is to achieve an operating margin of 20 percent.
Market Outlook
20
Outlook Q214
We continue to be prepared for
ongoing soft demand, but maintain our
forecast for the year. Our estimate for
the full year 2014 is that earnings per
share will be improved compared with
the previous year.
Enea is Powering the Wireless Broadband
Thank You!
For further information, please contact:
Anders Lidbeck, CEO
Håkan Rippe, CFO
Phone: +46 8 507 140 00