F-Secure Corporation, Financial Statement Release 2020, 10 February 2021 at 08.00 EET
F-Secure Financial Statement Release 1 January - 31 December 2020
A solid end to an unusual year
Highlights of October-December (Q4)
Revenue increased by 3% to EUR 57.9 million (56.1m)
Revenue from corporate security remained at previous year’s level, and was EUR 32.0 million (32.7m)
Revenue from consumer security increased by 11% to EUR 25.9 million (23.4m)
Adjusted EBITDA was EUR 7.3 million (6.6m), 12.6% of revenue (11.8%)
EBIT was EUR 3.1 million (0.8m), 5.4% of revenue (1.3%)
Earnings per share (EPS) was EUR 0.02 (EUR 0.00)
Cash flow from operating activities before financial items and taxes was EUR 19.4 million (8.7m)
Highlights of January-December
Revenue remained at previous year’s level, and was EUR 220.2 million (217.3m)
Revenue from corporate security remained at previous year’s level, and was EUR 120.1 million (122.5m)
Revenue from consumer security increased by 6% to EUR 100.1 million (94.8m)
Adjusted EBITDA improved significantly and was EUR 35.7 million (23.2m), 16.2% of revenue (10.7%)
EBIT was 19.7 million (7.2m), 8.9% of revenue (3.3%)
Earnings per share (EPS) was EUR 0.08 (EUR 0.02)
Cash flow from operating activities before financial items and taxes was EUR 48.3 million (19.0m)
In 2020 there are no changes to accounting principles impacting comparability to the previous year.
Figures in this report are unaudited. Figures in brackets refer to the corresponding period in the previous year, unless otherwise stated.
F-Secure’s financial outlook for 2021 is:
Revenue from corporate security products is expected to grow at a high single-digit rate.
Revenue from cyber security consulting is expected to grow but uncertainty remains due to the COVID-19 pandemic.
Revenue from consumer security is expected to grow approximately at the same rate as in 2020.
Adjusted EBITDA is expected to remain approximately at the previous year's level (EUR 35.7 million).
The COVID-19 pandemic continues to impact the predictability of cyber security consulting and can also impact the new sales of software solutions. The related risks are described in the Financial Statement Release 2020.
CEO JUHANI HINTIKKA
The year ended positively as orders increased clearly in our product businesses and we saw improvement in the consulting business. In Q4, F-Secure’s revenue grew by 3% driven by strong performance in consumer security. The business activity levels started to normalize to pre-COVID-19 levels, resulting in increasing costs and consequently an adjusted EBITDA margin of 13%.
During Q4 the revenue growth of Managed Detection and Response continued. The order intake was at the highest level of 2020 as we won multiple new customers and the renewal performance was good. These new deals were won in demanding customer verticals, such as technical trade, critical infrastructure and finance. I was pleased to witness the strong performance in MDR despite the ongoing pandemic still impacting the length of sales cycles.
The new sales performance especially in our cloud-based endpoint protection (EPP) products was strong in Q4. Importantly, the increase in orders was faster than for years, and it clearly outpaced revenue growth, which speaks for the potential in this field of business. However, over the previous quarters we have seen a rise in contract duration, meaning that the revenue impact of new orders is spread over a longer time period.
The revenue from cyber security consulting decreased from the previous year’s level, as business still experienced the effects from the COVID-19 pandemic in the past quarter. Compared to previous quarters, recent developments have been positive due to organizations adjusting to remote deliveries and experiencing a constant need for advanced cyber security. This need has been apparent in recent occurrences, that have resulted in several Incident Response assignments to F-Secure. Overall, the short term predictability has improved gradually, but it is still subject to the volatility in the operating environment caused by the pandemic.
Consumer security grew from the previous year, and was driven by the sales of our core products: F-Secure SAFE in the operator channel and F-Secure TOTAL in the direct channel. The particularly high revenue growth of 11% stemmed from new subscriptions and a solid renewal performance, and the positive impact related to one-off items. In Q4, the positive traction around F-Secure ID PROTECTION continued as we signed four new deals with operator partners in Asia and Europe.
Over the past year, the COVID-19 pandemic has substantially impacted individuals and organizations alike. F-Secure has been focusing on the safety and well-being of our employees, while simultaneously transitioning to remote ways of working. Despite the transformed work environment, our cyber security operations carry on unaffected, ensuring the protection of our customers. F-Secure’s software businesses for both consumers and corporate customers proved their resilience in 2020, while consulting has been negatively influenced by the pandemic.
F-Secure is starting 2021 as a strong cyber security company with good momentum among channel and operator partners in software products. Furthermore, we have a strong foothold in the fast growing MDR market and in the recovering cyber security consulting. Thanks to our significantly improved profitability, the Board of Directors is proposing a dividend of EUR 0.04 per share.
Cost of revenue
Other operating income 1)
Operating expenses 1)
Sales & Marketing
Research & Development
Adjusted EBITDA 2)
of revenue, %
Adjustment to operating income
of revenue, %
Depreciation & amortization
of revenue, %
Adjusted EBIT 2)
of revenue, %
Earnings per share, (EUR) 3)
Cash flow from operations before financial items and taxes
Cash and financial assets at fair value through P&L
Equity ratio, %
Personnel, end of period
Excluding Items Affecting Comparability (IAC) and depreciation and amortization
Adjustments are material items outside normal course of business associated with acquisitions, integration, restructuring, gains or losses from sales of businesses and other items affecting comparability. Reconciliation and a breakdown of adjusted costs is in note 5 of the Table Section of this report.
Based on the weighted average number of outstanding shares during the period 158,082,324 (1-12/2020).
Events after period-end
The company's dividend policy is to pay approximately half of its profits as dividends. On December 31, 2020, F-Secure Oyj’s distributable funds totaled EUR 74.6 million of which net profit for the period was EUR 14.8 million. No material changes have taken place in the company’s financial position after the balance sheet date.
F-Secure’s Board of Directors proposes that a dividend of EUR 0.04 per share which totals EUR 6.4 million in dividends, be paid on the basis of the balance sheet to be adopted for the financial year that ended December 31, 2020. The dividend shall be paid to shareholders who are registered in the company’s shareholder register maintained by Euroclear Finland Oy on the record date for the dividend payment, March 26, 2021. The Board of Directors proposes that the dividend will be paid on Thursday, 8 April 2021.
F-Secure’s CEO, Juhani Hintikka, and CFO, Eriikka Söderström, will present the results in a webcast starting at 14.00 EET. The webcast will be held in English and can be accessed at https://f-secure.videosync.fi/2021-02-10-full-year-results. Questions are requested in written format in the webcast portal.
This is a summary of F-Secure’s Financial Statement Release. The full report is a PDF file attached to this stock exchange release and is also available on the company's website.
During the year 2021, F-Secure Corporation will publish financial information as follows:
Interim report January-March 2021, April 29, 2021
Half year financial report January-June 2021, July 15, 2021
Interim report January-September 2021, October 21, 2021
Annual General Meeting
The Annual General Meeting is scheduled for Wednesday, March 24, 2021 at 14:00 EET. The Board of Directors will convene the meeting. The Annual Report for 2020 will be published on the Company's website on 10 February 2021. More information is available at https://www.f-secure.com/en/investors/governance?a=annual-general-meeting.
Eriikka Söderström, CFO, F-Secure
Henri Kiili, Investor Relations and Corporate Finance Director, F-Secure
+358 40 8405450