Proha Plc Stock Exchange Bulletin May 12, 2005 at 9.00 a.m.
PROHA PLC INTERIM REPORT (IFRS) JANUARY 1, - MARCH 31, 2005
- The Proha Group net sales for the period January 1, - March 31, 2005 were
EUR 15.4 million (EUR 16.9 million in the corresponding period in 2004).
- The operating profit was EUR 0.3 (-1.0) million.
- During the period the Group s cash flow from operations was EUR 1.6
(-2.7) million.
- The interim report of Proha has been prepared according to the
International Financial Reporting Standards (IFRS).
- Proha s management holds to its previous estimate of Proha Group s
positive result for the year 2005.
KEY RATIOS OF THE PROHA GROUP
(EUR million) 1-3/ 1-3/ Change 1-12/
2005 2004 % 2004
Net sales 15.4 16.9 -8.5% 65.7
Operating result 0.3 -1.0 132.8 % 2.2
% of net sales 2.1% -5.8% 3.4%
Operating result
before taxes -0.1 -0.8 91.8% 2.2
Result for the period -0.3 -1.3 77.9% 1.3
ROE % -7.8% -45.6% 11.3%
ROI % 13,5% -13.7% 17.8%
Cash and cash
equivalent 8.8 6.5 34.3% 5.1
Gearing % 0.0% 49.2% 24.8%
Equity/asset ratio % 35.1% 21.7% 35.3%
Capital expenditure 0.9 1.3 7.5
% of net sales 5.8% 7.7% 11.4%
Capitalized software
development costs 0.9 1.1 3.9
R&D costs 1.6 1.9 6.8
% of net sales 10.6% 11.0% 10.4%
Cash flow from
operating activities 1.6 -2.7 160.7% -4.0
Earnings/share, EUR
(undiluted) -0.005 -0.025 80% 0.022
Earnings/share, EUR
(diluted) -0.005 *) 0.022
Equity/share, EUR 0.25 0.15 66.7% 0.25
Average personnel
during period 531 598 -10.2% 569
Personnel
at the end of period 530 591 -11.4% 525
*)The EPS ratio, adjusted by the dilution effect, is not presented
because it would be better than the undiluted figure.
IFRS REPORTING
Proha will publish its first IFRS (International Financial Reporting
Standards) Financial Statements for the financial year ending December
31, 2005. The interim reports for 2005, will be prepared in accordance
with the IAS 34.
The comparative financial data for 2004 presented in this interim
report as well as the essential differences between the Finnish
Accounting Principles and IFRS standards were published in stock
exchange bulletin on March 3, 2005. The IFRS standards differ
significantly from the Finnish Accounting Standards (FAS) used by
Proha in the interim reports and the financial statements for 2004.
Compared to Finnish Accounting Standards (FAS), adoption of IFRS has
the most significant impact on capitalization of software development
costs (IAS 38), treatment of goodwill and business combinations (IFRS
3) and share based payments (IFRS 2). Also the partial disposal of
Artemis International Solutions Corporation (AISC) has a material
effect on the Proha Group's result for 2004 when treated according to
IFRS. According to the IFRS 1 exemption the IFRS 3 standard is not
applied on acquisitions made prior the effective date of January 1,2004.
The information by segment is presented by business area based on the
Group s management structure and internal reporting system. The
segments reported are Artemis sub-group and Norwegian operations. The
unallocated items consist mainly of the Group s administrative
expenses.
GROUP STRUCTURE
The key business areas of Proha Group are the Artemis sub-group and the
Norwegian operations represented by Safran Software Solutions AS and
Dovre International AS. Proha s ownership at Artemis was 54.3% at the
end of the period. The Norwegian operations are fully owned by Proha
after the acquisition finalized in 2004.
On December 31.12.2004 the ownership at Artemis was 56.75%. The change
in the ownership is due to exercise of warrants entitling to 456,853
shares that were granted for a group of investors led by Emancipation
Capital and partial conversion of the convertible loan of Laurus
Master Fund, Ltd. into Artemis shares. Laurus converted a portion of
USD 242,000 of the total loan of USD 1.5 million into 166,700 Artemis
shares.
After the period Laurus has further converted USD 393,00 worth of
its loan receivable into 219,278 shares, after which Proha s ownership
at Artemis is 53.5%. The remaining portion of the convertible loan
Laurus may convert into maximum of 336,576 Artemis shares representing
2.2% of the total number of Artemis shares. Additionally, as part of
its financial arrangements Artemis has granted warrants to the group
of investors led by Emancipation Capital entitling to 409,092 shares.
Artemis has an incentive plan for personnel and management that
includes options entitling to company shares.
BUSINESS PERFORMANCE
In line with its strategy, Proha focuses on the international project,
resource and portfolio management software and service business. Proha
is the world leader in enterprise-level project, resource and portfolio
management solutions.
During the first quarter of 2005 the Artemis sub-group accounted for
approximately 59.0% (65.0% in 2004) of the net sales of the Group,
and project management operations in Norway, which mainly serve the
oil and gas sector represented approximately 40.1% (32.0%) of the
net sales of the Group.
Artemis sub-group
The historically slow growth of general enterprise software markets
continued and was geographically uneven. The US-markets continued to
grow at a slower pace than the European markets.
The sales of the new generation Artemis 7 solutions continued to
develop favorably. In the first quarter of 2005 Artemis customers
purchased six times more Artemis 7 licenses compared to the
corresponding period in 2004. Software solutions based on Artemis 7
represented over 60% (28%) of the total sales of new licenses. During
the period a total of 13.118 Artemis end-user licenses were purchased
(15.370 in 2004). The total number of Artemis licenses sold worldwide
is over 619,000.
During the first quarter of 2005 Artemis gained significant new
customers in all geographies; in Americas, Europe, Asia Pacific and
Japan. New customers include among others Pfizer, AIU, Singapore
Immigration Custom authority, Atos Origin Integration, CELESIO, La
Poste DIAQ, Ministere des Transports du Quebec, INAIL, ISBAN and Sogei
(Agenzia delle Entrate) for IT Management solutions; Metropolitan
Police Property Services for Public Investment Management solutions;
Cummins, LG Micron, Toyota Techno Service, Denso, Shionogi Pharma,
Siemens and Saab for New Product Development solutions;
Tuas Power Pte Ltd for Strategic Asset Optimization solutions; and
BAE Systems - Avionics and BAE Systems - Submarines for Aerospace
and Defense Program Management solutions.
The cost level of Artemis sub-group was significantly lower than in the
corresponding period in 2004. This provides Artemis with good
preconditions to improve profitability and to reach a positive result
in 2005. The predictability of the global software markets is low, but
at the present cost level the subgroup will improve its competitive
position.
Norwegian operations
At Dovre the demand for consulting is anticipated to grow due to the
optimism in the oil and gas industry investments following the high
oil prices. The business volume of the Norwegian operations developed
favorably, but preparations for growth resulted in excess capacity
during the first two months of 2005 consequently lowering the
profitability. Dovre has continued its efforts to expand its
international operations and increased personnel in Houston, Texas.
Safran Software focused its marketing efforst on oil and gas industry
companies in close cooperation with its partners.
NET SALES
The Proha Group's net sales for the period January 1 - March 31, 2005
were EUR 15.4 million (16.9 million in 2004), which is 8.5% less than
in the previous year.
Distribution of net sales by revenue type:
Net sales 1-3/2005 Percentage 1-3/2004 Percentage 1-12/2004 Percentage
of net of net of net
sales sales sales
One-time
license revenue 2.1 13.7% 2.6 15.4% 11.1 17.0%
Recurring
license revenue 3.5 22.7% 3.8 22.5% 14.9 22.6%
Services 9.8 63.6% 10.5 62.1% 39.7 60.4%
------------------------------------------------------------------------
Total 15.4 100.0% 16.9 100.0% 65.7 100.0%
The emphasis of net sales was still on services, which constituted
EUR 9.8 (10.5) million or 63.6% (62.1%) of the net sales. The services
include Dovre's project management consultancy and the consultancy,
training, implementation and support services of Artemis' software
solutions.
License sales amounted to EUR 5.6 (6.4) million, accounting for 36.4%
(37.9%) of the net sales. The share of one-time licenses was
EUR 2.1 (2.6) million and that of recurring licenses EUR 3.5 (3.8) million.
Distribution of net sales by segment
(EUR million)
1-3/2005 1-3/2004 Change, %
Artemis sub-group 9.1 11.0 -17.0%
Norwegian operations 6.2 5.4 +14.6%
Unallocated items 0.1 0.5
Inter-segment net sales 0.0 0.0
--------------------------------------------------------------------
Group total 15.4 16.9 -8.5%
Distribution of net sales by country:
(EUR million)
1-3/2005 Percentage 1-3/2004 Percentage 1-12/2004 Percentage
EUR of net EUR of net EUR net
million sales million sales million sales
Great Britain 1.4 9.1% 1.7 10.1% 5.8 8.8%
Italy 1.5 9.7% 1.6 9.5% 6.0 9.1%
Japan 1.0 6.4% 1.1 6.5% 4.1 6.3%
Norway 6.1 40.0% 5.4 32.0% 22.4 34.0%
France 1.8 11.7% 1.4 8.3% 6.6 10.0%
Germany 0.4 2.4% 0.8 4.7% 2.8 4.3%
Finland 1.3 8.3% 2.1 12.4% 7.2 11.0%
United States 1.6 10.5% 2.4 14.1% 9.7 14.8%
Others 0.3 1.9% 0.4 2.4% 1.1 1.7%
-------------------------------------------------------------------------------
Total 15.4 100.0% 16.9 100.0% 65.7 100.0%
The net sales of the Artemis sub-group totaled EUR 9.1 (11.0) million
and accounted for 59.0% (65.0%) of the Group's net sales. The net sales of
Artemis declined by 17% compared to the corresponding period in 2004.
At Artemis sub-group the share of both one-time and recurring
license revenue increased. Artemis 7 represented 60.3% of total
software license revenue compared to 27.7% for the first quarter of 2004.
The net sales of the Norwegian operations totaled EUR 6.2 (5.4) million and
accounted for 40.1% (32.0%) of the Group's net sales. The net sales of
Norwegian operations grew by 15% compared to the corresponding period
in 2004.
PROFITABILITY
The operating profit for the first quarter in 2005 totaled EUR 0.3
(-1.0) million.
Distribution of operating result by segment:
(EUR million)
1-3/2005 1-3/2004 Change, %
Artemis sub-group 0.3 -1.0 +130.3%
Norwegian operations 0.2 0.4 -43.8%
Unallocated items -0.2 -0.4
--------------------------------------------------------------------
Group total 0.3 -1.0 +132.8%
During the period the cost level of the Group business operations was
approximately 12% lower compared to the previous year.
The Artemis sub-group's operating profit was EUR 0.3 (-1.0) million,
which includes EUR 0.6 million of arbitration proceedings from
Changepoint France settlement.
The operating profit of the Norwegian operations was EUR 0.2 (0.4)
million. The extra costs aimed at business growth increased the cost
level of the Norwegian operations during January and February 2005.
However, the business operations were profitable.
The operating result for the first quarter in 2005 does not include
any non-recurring restructuring charges. The total EUR 1.0 million of
non-recurring restructuring charges for the corresponding period in
2004 include employment termination costs of EUR 0.8 million and other
operating expenses of EUR 0.2 million at Artemis.
Goodwill is not amortized but tested for impairment under IAS 36.
No indications of impairment of assets exists.
In the first quarter of 2005 the research and development costs were
EUR 1.6 (1.9) million in total, of which a total of EUR 0.9 (1.1)
million were capitalized. Amortization of software development costs
were EUR 0.1 (0.0) million in the first quarter of 2005.
In the first quarter of 2005 the result before taxes was EUR -0.1
(-0.8) million. The net result for the period was EUR -0.3 (-1.3)
million.
Earnings per share amounted to EUR -0.005 (-0.025). Return on
investment (ROI) was 13.5% (-13.7%) and return on equity (ROE) was
-7.8% (-45.6%).
CASH FLOW, FINANCING AND INVESTMENTS
The balance sheet total on March 31, 2005 was EUR 47.4 (45.2) million.
At the end of the period, cash and cash equivalents totaled EUR 8.8
(6.5) million, growing EUR 3.8 million compared to the situation on
December 31, 2004.
In the first quarter of 2005, cash flow from operating activities was
EUR 1.6 million (-2.7). In addition to the period sales the cash flow
was increased by payments made for the fourth quarter 2004 sales.
Total of EUR 1.6 million were used for investments primarily on
software development. However, the total cash flow of investments was
EUR 2.3 million positive with EUR 0.6 million proceeds from divestment
of Changepoint France and EUR 0.2 million from the partial disposal
of Artemis increasing the cash flow with total EUR 0.8 million and the
loan receivables decreased by EUR 2.6 million.
Total of EUR 2.1 million new loans were drawn and total of EUR 2.3 million
loans repayed, resulting in total EUR -0.2 million in cash flow of
financing activities.
Equity to assets ratio was 35.1% (21.7%) and gearing was 0.0% (49.2%).
On March 31, 2005 the interest-bearing liabilities amounted to EUR 8.8
(11.1) million, accounting for 18.7% (24.6%) of the Group's
shareholders equity and liabilities total. Of the interest-bearing
liabilities, EUR 4.7 (4.2) million were non-current liabilities and
EUR 4.2 (6.9) million current liabilities. The Group's Quick Ratio was
1.2 (1.0).
In 2005 the capital expenditures were EUR 0.9 (1.3) million including
EUR 0.9 (1.1) million of capitalized software development costs.
STATEMENT ON THE ADEQUACY OF THE COMPANY'S ASSETS
On March 31, 2005 the Group's cash and cash equivalents amounted to
EUR 8.8 (6.5) million.
According to Proha's management, the liquid assets of the company are
sufficient for Proha to continue as a going concern during the
following 12 months.
RESEARCH AND DEVELOPMENT
The software development of Proha group is mainly done in the Artemis
sub-group. The development of Artemis 7 and solutions based on it
continued during the period. After the period under review Artemis
released a new version of Artemis Views software.
Following the release of Safran Project software in January, Safran
Software has focused on developing the next version of its newest
product, Safran for Microsoft Project Platform, to be released on
the second quarter of 2005.
The software development costs of strategic products were EUR 1.6
(1.9) million, representing 10.6% (11.0%) of the period's net sales.
Capitalization of software development costs has a material positive
effect on Proha s result for the first quarter of 2005. The
capitalization of software development costs commenced on January 1,
2004. The software development costs have not been capitalized prior
to January 1, 2004 because the criteria for IAS 38 accounting
treatment with respect to the control system were not met prior
January 1, 2004 (IFRS 1 IG46).
Of the software development costs incurred in the first quarter of
2005 a total of EUR 0.9 (1.1) million has been capitalized. Of the
previously capitalized software development costs EUR 0.1 (0.0)
million was amortized.
Software development costs are treated under IAS 38, i.e. development
costs of totally new products and product versions with significant
new features are capitalized when certain criteria for recognition are
met and amortized over their useful lives. Maintenance of existing
products and their minor development are immediately expensed.
Government grants related to capitalized development expenses are
deducted from the carrying amount of the asset. The useful life of
software development expenses is estimated to be between three and
five years depending on the type of product developed. The
amortization is commenced when the software is available for use.
In both Proha s FAS (Finnish Accounting Standards) year-end financial
statement and quarterly reports for 2004, the software development
costs have not been capitalized. All software development costs
including strategic and regionally developed tactical products have
been recognized as an expense in the year they incurred.
PERSONNEL
On March 31, 2005 the Proha Group employed 530 (591) people worldwide.
At the end of the period, Artemis sub-group employed 316 (369) people
and the Norwegian operations 186 (181). The number of Proha personnel
declined by 10.3% compared to the corresponding period in 2004.
During the first quarter of 2005, the average number of Group
personnel was 531 (598).
Staff costs amounted to EUR 12.1 (12.4) million, constituting 78.6%
(73.2%) of net sales.
In the first quarter of 2005 there were no one-time restructuring
charges. The non-recurring restructuring charges for the corresponding
period in 2004 include employment termination costs of EUR 0.8
million.
Capitalization of product development costs as per IAS 38 standard
reduces the staff costs in the income statement. Of the staff costs
incurred during the first quarter of 2005 EUR 0.7 (0.9) million were
capitalized.
According to IFRS 2 standard the option rights granted for the
employees are to be measured at fair value on the grant date and
expensed in the income statement during their vesting period. Proha
applies the standard to all option rights granted after November 7,
2002 and not vested before January 1, 2005. In the first quarter of
2005 approx. EUR 0.1 (0.0) million of options were expensed. Majority
of option expenses are due to options granted for the Artemis sub-group
employees.
PROHA'S ANNUAL GENERAL MEETING ON APRIL 22, 2005
On April 22, 2005 the Annual General Meeting of Proha elected Birger
Flaa as the new member of the Board of Directors. Olof Ödman
(Chairman), Pekka Pere, Alec Gores, Carlo Boldi and Pekka Mäkelä were
re-elected.
The Annual General Meeting decided that each Board member, not
employed by the Proha Group or by such company which owns more than
five percents of Proha's share capital and who does not exercise
dominant influence over such company, to be paid EUR 18,000 per year
as remuneration for board work.
Ernst & Young Oy was elected to continue as the Company's auditor,
with Ulla Nykky, APA, as the auditor in charge.
On April 22, 2005 the Annual General Meeting authorized the Board of
Directors to increase the company's share capital. Pursuant to this
authorization, the aggregate maximum number of new shares to be issued
or offered for subscription pursuant to stock options, option warrants
and/or convertible bonds shall not exceed 12,243,554 shares with an
account equivalent value of EUR 0.26 each, and the share capital of
the Company may be increased by no more than EUR 3,183,324.04, which
represents 20% of the currently registered share capital and of the
votes that can be cast in the General Meeting of Shareholders. The
authorization is valid until April 22, 2006.
The Annual General Meeting approved the Board of Directors' proposal
to issue a maximum of 585,000 option rights that are offered deviating
from the shareholders' pre-emptive subscription right to the
management of the Group companies. Options will not be offered to the
members of the Board of Directors or to the CEO of Proha Plc.
The subscription of the option rights began on April 25, 2005 and
will end on May 25, 2005. If the options are exercised the share
capital of Proha Plc may increase by a maximum of 585,000 shares and
EUR 152,100.00. The options now issued constitute a maximum of 0.95%
of the Company's shares and voting rights after the potential share
capital increase. The subscription price is the weighted average price
of the Company share from April 4, 2005 through April 22, 2005. The
complete terms and conditions were given in a stock exchange bulletin
on March 30, 2005.
The Annual General Meeting confirmed the Financial Statements of 2004
and discharged the CEO and the Board of Directors from liability.
The Annual General Meeting approved the Board of Directors' proposal
according to which no dividend is paid and the result for the
financial year is entered in profit/loss brought forward.
The Annual General Meeting cancelled the decision of the Extraordinary
General Meeting of Proha on October 23, 2002 to continue the strategy
of owning Artemis International Solutions Corporation shares through
Proha and discontinue implementing other structure alternatives. The
Board of Directors is now enabled to evaluate and carry out all
strategic alternatives, which the Board of Directors considers to
serve the interests of the shareholders in the changed circumstances.
CORPORATE GOVERNANCE
Proha Plc follows the recommendations of the Helsinki Stock Exchange,
the Central Chamber of Commerce and the Confederation of Finnish
Industries and Employers regarding the corporate governance of
publicly held companies. Proha deviates from the recommendation in two
respects. 1) Of the six members of the Proha Board of Directors only
two are currently independent of the company and only one of them is
also independent of any significant owners. 2) A share-based bonus
system may also be applied to those members of the Board, who do not
have an employment relationship with the company. Proha's corporate
governance principles can be found on the company's website at
www.proha.com.
SHARE CAPITAL AND AUTHORIZATIONS TO ISSUE SHARES
Proha Plc has one class of shares. The book value of the shares is EUR
0.26 per share. Each share entitles the shareholder to one vote. Proha
Plc shares are traded on the NM list of the Helsinki Stock Exchange.
On January 1, 2005, the subscribed capital of Proha Plc was EUR
15,916,620.20 and the total number of shares was 61.217.770. During
the first quarter of 2005 there were no changes in the subscribed
capital.
The Board of Directors has the authorization by the Annual General
Meeting to increase the company's share capital. Pursuant to this
authorization, the aggregate maximum number of new shares to be issued
shall not exceed 12,243,554 shares with an account equivalent value of
EUR 0.26 each, and the share capital of the Company may be increased
by no more than EUR 3,183,324.04. The authorization is valid until
April 22, 2006.
At the meeting on March 29, 2005 Proha Board of Directors decided to
issue a maximum of 644,970 employee options. In it's meeting on April
26, 2005, Proha Board of Directors approved the subscriptions of the
option issue for employees that is part of Proha Group's incentive and
commitment program. In the issue, a total of 535,080 Proha Plc stock
options were subscribed, entitling to the subscription of 535,080
shares. The stock options were granted without compensation to the key
employees of Proha Plc and certain Group companies excluding the
members of the Proha Board and CEO as well as the management of the
Group companies.
The total of 585,000 management options issued by the Annual General
Meeting on April, 22, 2005 were fully subscribed and the Board of
Directors approved the subscriptions in its meeting on May 9, 2005.
The Board confirmed the subscription price for the shares subscribed
on the basis of the stock options as EUR 0.50 per share. The confirmed
share subscription price for the options is the weighted average price
of the Company share from April 4, 2005 through April 22, 2005 and
thus corresponds to the fair market price.
The terms and conditions of the option issues were published in the
Stock Exchange Bulletin on March 30, 2005.
TRADING ON THE HELSINKI STOCK EXCHANGE
The number of registered shareholders of Proha Plc totaled 3,782 on
March 31, 2005. During the period January 1 - March 31, 2005, the
share price was EUR 0.44 at its lowest and EUR 0.54 at its highest.
The closing price on March 31, 2005 was EUR 0.47. Market
capitalization was approximately EUR 28.8 million at the end of the
period. The trading volume of the Proha share on the NM list of the
Helsinki Stock Exchange was approximately EUR 1.2 million.
PROSPECTS FOR THE NEAR FUTURE
The business of Proha Group is anticipated to develop positively
during the second quarter of 2005. The sales of Artemis Artemis 7
solutions are anticipated to grow and the profit margins to improve.
Also, the business volume and profitability of the Norwegian
operations are anticipated to improve slightly.
Proha s management holds to its previous estimate of Proha Group s
positive result for the year 2005.
PUBLICATION OF ARTEMIS' RESULT FOR THE FIRST QUARTER 2005
The Artemis sub-group published its Report for first quarter 2005 on
May 11, 2005. The Report for first quarter 2005 (FORM 10-Q) is
available on the SEC website at
www.sec.gov/edgar/searchedgar/companysearch.html under the name
Artemis International.
PRESS CONFERENCE
Proha Plc will hold a press conference for the media and financial
analysts on May 12, 2005 at 12.00 a.m., at Marskin Sali cabinet,
World Trade Center, address Aleksanterinkatu 17, Helsinki.
For more information please contact:
PROHA PLC
CEO Pekka Pere, tel. +358-(0)20 4362 000
pekka.pere@proha.com
www.proha.com
DISTRIBUTION:
Helsinki Stock Exchange
Major Media
The figures in this report are unaudited.
PROHA GROUP CONSOLIDATED INCOME STATEMENT AND BALANCE SHEET
JANUARY 1-MARCH 31, 2005
INCOME STATEMENT 1/05-3/05 1/04-3/04 1/04-12/04
(EUR 1000) (EUR 1000) (EUR1000)
Net sales 15 443 16 887 65 714
Other operating income 737 27 4 433
Materials and services -861 -1 401 -4 608
Staff costs -12 133 -12 364 -48 333
Depreciation, amortization and
value adjustments
Depreciation according to plan -188 -133 -719
Change in negative goodwill 0 22 14
Depreciation, amortization and
value adjustments total -188 -111 -706
Other operating expenses -2 676 -4 023 -14 291
Operating profit/loss 322 -986 2 210
Financial income and expense -387 157 -73
Share of associated companies'
results 0 28 80
Result before taxes -65 -802 2 218
Income taxes -237 -336 -718
Change in deferred tax
liabilities 0 -11 -13
Profit/loss before minority
interest -303 -1 149 1 487
Minority interest 9 -180 -212
Profit/loss for the financial
year -293 -1 329 1 274
BALANCE SHEET 31.3.2005 31.3.2004 31.12.2004
ASSETS (EUR 1000) (EUR 1000) (EUR1000)
Non-current assets
Intangible assets 4 986 1 591 4 045
Goodwill on consolidation 11 634 12 166 11 912
Tangible assets 763 1 028 818
Investments 1 044 2 133 1 095
Non-current assets total 18 426 16 918 17 869
Current assets
Non-current receivables 1 077 427 1 081
Current receivables 19 072 21 327 21 966
Marketable securities 0 80 0
Cash and cash equivalents 8 843 6 505 5 069
Current assets total 28 992 28 339 28 116
ASSETS TOTAL 47 418 45 257 45 984
SHAREHOLDERS' EQUITY AND
LIABILITIES
Shareholders' equity
Subscribed capital 15 917 13 875 15 917
Share premium account 4 807 2 964 4 807
Translation differences 1 867 1 871 1 635
Profit/loss brought forward -6 832 -9 382 -8 217
Profit/loss for the financial
year -293 -1 329 1 274
Shareholders' equity total 15 465 7 999 15 416
Minority interest 54 1 231 70
Provisions 222 212 190
Liabilities
Non-current liabilities 4 954 4 320 5 028
Current liabilities 26 723 31 493 25 280
Liabilities total 31 677 35 814 30 308
TOTAL EQUITY AND LIABILITIES 47 418 45 257 45 984
KEY RATIOS OF THE PROHA GROUP
1) Weighted number of shares 61 217 770 53 367 270 57 313 830
1) Earnings per share
(undiluted), EUR -0,005 -0,025 0,022
2) Weighted number of shares
diluted by stock options 61 377 131 55 649 910 58 473 243
2) Earnings per share,
(diluted), EUR -0,005 *) 0,022
3) Number of shares at the end
of the period 61 217 770 53 367 270 61 217 770
3) Equity per share, EUR 0,25 0,15 0,25
*) The key ratio Earnings per share,
adjusted by the dilution effect, is
not presented because it would
be better than the undiluted figure.
GROUP STATEMENT OF CHANGES IN
SHAREHOLDERS' EQUITY
Subscribed Share Translation Profit/ Total
capital premium differences loss
account brought
forward
SHAREHOLDERS'
EQUITY IFRS
January 1, 2005 15 917 4 807 1 635 -6 943 15 416
Change in
translation
difference 232 232
Sharebased
payments 103 103
Profit/loss for
the period -293 -293
Other change 7 7
SHAREHOLDERS'
EQUITY IFRS
March 31, 2005 15 917 4 807 1 867 -7 126 15 465
Subscribed Share Translation Profit/ Total
capital premium differences loss
account brought
forward
SHAREHOLDERS'
EQUITY IFRS
January 1, 2004 13 875 2 964 2 363 -9 346 9 856
Change in
translation
difference -492 -492
Sharebased
payments 6 6
Profit/loss for
the period -1 329 -1 329
Other change -42 -42
SHAREHOLDERS'
EQUITY IFRS
March 31, 2004 13 875 2 964 1 871 -10 711 7 999
CASH FLOW STATEMENT 1/05-03/05 1/04-03/04 1/04-12/04
(EUR 1000) (EUR 1000) (EUR 1000)
Cash flow from operating activities
Operating profit/loss 322 -986 2 210
Adjustments -91 249 -2 659
Change in net working
capital 2 359 -1 580 -2 572
Financial income and
expense, net -478 259 230
Income taxes -487 -619 -1 203
Cash flow from operating activities 1 625 -2 677 -3 994
Cash flow from investing activities
Investments in tangible and
intangible assets -1 073 -1 267 -4 147
Investments in other shares -3
Disposals of
associated companies 573
Disposals of other
investments 236
Partial disposals of
subsidiary companies 197 6 564
Proceeds and repayments of
loan receivables 2 608 -9 292
Cash flow from investing activities 2 305 -1 279 2 945
Cash flow from financing activities
Proceeds from short-term
loans 2 119 3 556 4 847
Repayments of short-term
loans -2 262 -19 -2 983
Proceeds from long-term
loans 223
Repayments of long-term
loans -13 -135 -134
Increase/decrease in long-
term receivables -2 500
Dividends paid -393
Cash flow from financing activities -156 3 402 -940
Change in cash and cash equivalents 3 774 -554 -1 989
Cash and cash equivalents Jan.1 -5 069 -7 058 -7 058
Cash and cash equivalents March.31 8 843 6 504 5 069
Change in cash and cash equivalents 3 774 -554 -1 989
CONTINGENT LIABILITIES 31.3.2005 31.12.2004
(EUR 1000) (EUR 1000)
COLLARETAL FOR OWN COMMITENTS
Debts secured by corporate
mortgages
Pension loans 100 100
Corporate mortgages given as
security of the loans 168 168
Debts secured by the assets of the
company
Loans from financial institutions 970 1 101
Debts secured by the assets of
Artemis International Solutions
Corporation except for intellectual
property rights.
Debts secured by assets
Loans and checking account credit
lines used 1 333 1 810
Book value of trade receivables and
fixed assets given as security 4 018 6 035
Debts secured by shares
Loans from financial institutions 72 72
Book value of pledged shares 152 152
Leasing and rental liabilities
In the following financial year 2 300 2 673
Thereafter 4 060 6 162
Total 6 360 8 835
CONTINGENT LIABILITIES ON BEHALF OF
SUBSIDIARY COMPANIES
Debts secured by deposits
Loans from financial institutions 625 2 500
Book value of deposits 625 2 500
RECONCILIATION OF RESULT IN THE
COMPARATIVE PERIOD
GROUP INCOME STATEMENT 1.1.- 31.3.2004
FAS IFRS- IFRS
1-3/2004 adjustments 1-3/2004
Net sales 16 887 0 16 887
Other operating income 23 4 27
Materials and services -1 401 0 -1 401
Staff costs -13 262 898 -12 364
Depreciation, amortization and
value adjustments
Depreciation according to plan -155 22 -133
Amortization of goodwill -469 469 0
Change in negative goodwill 22 0 22
Depreciation, amortization and
value adjustments total -602 491 -111
Other operating expenses -4 216 193 -4 023
Operating profit/loss -2 571 1 585 -986
Financial income and expense 161 -4 157
Share of associated companies'
results 28 0 28
Result before taxes -2 382 1 580 -802
Income taxes -337 1 -336
Change in deferred tax liabilities 0 -11 -11
Profit/loss before minority
interest -2 719 1 570 -1 149
Minority interest -180 0 -180
Profit/loss for the financial year -2 899 1 570 -1 329
RECONCILIATION OF SHAREHOLDERS'
EQUITY IN THE COMPARATIVE PERIOD
GROUP BALANCE SHEET 31.3.2004 FAS IFRS IFRS
ASSETS 31.3.2004 adjustments 31.3.2004
Non-current assets
Intangible assets 451 1 140 1 591
Goodwill on consolidation 11 951 215 12 166
Tangible assets 1 028 0 1 028
Investments 2 133 0 2 133
Non-current assets total 15 563 1 355 16 918
Current assets
Non-current receivables 427 0 427
Current receivables 21 327 0 21 327
Marketable securities 80 0 80
Cash and cash equivalents 6 505 0 6 505
Current assets total 28 339 0 28 339
ASSETS TOTAL 43 902 1 355 45 257
SHAREHOLDERS' EQUITY AND
LIABILITIES
Shareholders' equity
Subscribed capital 13 875 0 13 875
Share premium account 2 964 0 2 964
Profit/loss brought forward *) -7 529 18 -7 511
Profit/loss for the financial
year -2 899 1 570 -1 329
Shareholders' equity total 6 411 1 588 7 999
Minority interest 1 231 0 1 231
Negative goodwill 245 -245 0
Provisions 213 -1 212
Liabilities
Non-current liabilities 4 400 -80 4 320
Current liabilities 31 402 91 31 493
Liabilities total 35 802 12 35 814
TOTAL EQUITY AND LIABILITIES 43 902 1 355 45 257
RECONCILIATION OF RESULT IN THE
COMPARATIVE PERIOD
GROUP INCOME STATEMENT 1.1.- 31.12.2004
FAS IFRS- IFRS
1-12/2004 adjustments 1-12/2004
Net sales 65 714 0 65 714
Other operating income 783 3 650 4 433
Materials and services -4 608 0 -4 608
Staff costs -50 379 2 046 -48 333
Depreciation, amortization and
value adjustments
Depreciation according to plan -614 -105 -719
Amortization of goodwill -2 066 2 066 0
Change in negative goodwill 14 0 14
Depreciation, amortization and
value adjustments total -2 666 1 960 -706
Other operating expenses -15 432 1 141 -14 291
Operating profit/loss -6 588 8 798 2 210
Financial income and expense -60 -13 -73
Share of associated companies'
results 80 0 80
Result before taxes -6 568 8 786 2 218
Income taxes -719 1 -718
Change in deferred tax liabilities 35 -48 -13
Profit/loss before minority
interest -7 252 8 739 1 487
Minority interest -212 0 -212
Profit/loss for the financial year -7 464 8 738 1 274
RECONCILIATION OF SHAREHOLDERS'
EQUITY IN THE COMPARATIVE PERIOD
GROUP BALANCE SHEET 31.12.2004 FAS IFRS IFRS
ASSETS 31.12.2004 adjustments 31.12.2004
Non-current assets
Intangible assets 336 3 709 4 045
Goodwill on consolidation 13 227 -1 315 11 912
Tangible assets 817 1 818
Investments 1 095 0 1 095
Non-current assets total 15 475 2 394 17 869
Current assets
Non-current receivables 1 081 0 1 081
Current receivables 21 966 0 21 966
Cash and cash equivalents 5 069 0 5 069
Current assets total 28 116 0 28 116
ASSETS TOTAL 43 591 2 393 45 984
SHAREHOLDERS' EQUITY AND
LIABILITIES
Shareholders' equity
Subscribed capital 15 917 0 15 917
Share premium account *) 11 412 -7 396 4 016
Profit/loss brought forward *) -6 794 1 003 -5 791
Profit/loss for the
financial year -7 464 8 738 1 274
Shareholders' equity total 13 071 2 345 15 416
Minority interest 70 0 70
Provisions 190 0 190
Liabilities
Non-current liabilities 4 980 48 5 028
Current liabilities 25 280 0 25 280
Liabilities total 30 260 48 30 308
TOTAL EQUITY AND LIABILITIES 43 591 2 393 45 984
*) includes translation differences
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