TIDMSSH1V
SSH COMMUNICATIONS SECURITY CORPORATION -- STOCK EXCHANGE
RELEASE -- APRIL 26, 2023, AT 09:00 A.M. EEST
NET SALES INCREASED BY 9.3%, AND EBITDA REMAINED POSITIVE
January--March 2023:
-- Net sales increased by 9.3% to EUR 4.8 million (EUR 4.4 million)
-- EBITDA was EUR 0.2 million (EUR 0.5 million), 3.3% of net sales
-- Operating loss was EUR -0.7 million (EUR --0.2 million), -14.2% of net
sales
-- Cash flow from operations increased by 158% to EUR 2.0 million (EUR 0.8
million)
-- Subscription revenue, ARR increased by 27% to EUR 10.3 million (EUR 8.1
million)
-- Recurring revenue, ARR increased by 12% to EUR 18.3 million (EUR 16.4
million)
The equity ratio was 46.8% (43.8%). Liquid assets at quarter-end
were EUR 6.1 million (EUR 7.6 million).
A PDF file of the Business Review is attached to this
release.
Key figures
---------------------------------------------------------------------
m EUR 1--3/2023 1--3/2022 Change % 1--12/2022
------------------------- --------- --------- -------- ----------
Net sales 4.8 4.4 9.3 19.3
------------------------- --------- --------- -------- ----------
EBITDA 0.2 0.5 -70.6 2.7
------------------------- --------- --------- -------- ----------
% of net sales 3.3 12.3 -73.2 13.9
------------------------- --------- --------- -------- ----------
Operating profit/loss -0.7 -0.2 -0.4
------------------------- --------- --------- -------- ----------
% of net sales -14.2 -5.2 -2.3
------------------------- --------- --------- -------- ----------
Profit/loss before taxes -1.0 -0.2 -0.7
------------------------- --------- --------- -------- ----------
Profit/loss -0.9 -0.1 -0.6
------------------------- --------- --------- -------- ----------
Return on equity, % -9.2 -1.5 -5.2
------------------------- --------- --------- -------- ----------
Return on investment,
% -7.4 -1.4 -4.7
------------------------- --------- --------- -------- ----------
Liquid assets 6.1 7.6 -19.7 5.7
------------------------- --------- --------- -------- ----------
Gearing (%) -38.2 -38.7 1.3 -27.9
------------------------- --------- --------- -------- ----------
Equity ratio (%) 46.8 43.8 7.0 46.1
------------------------- --------- --------- -------- ----------
Earnings per share,
EUR -0.03 -0.01 -0.05
------------------------- --------- --------- -------- ----------
Shareholders' equity
per share, EUR 0.25 0.28 -8.3 0.28
------------------------- --------- --------- -------- ----------
Recurring revenue, ARR 18.3 16.4 12.0 18.4
------------------------- --------- --------- -------- ----------
Subscription revenue,
ARR 10.3 8.1 27.4 9.9
------------------------- --------- --------- -------- ----------
Invoicing 3.2 3.9 -19.1 24.2
------------------------- --------- --------- -------- ----------
Deferred Revenue 12.8 8.4 52.5 14.1
------------------------- --------- --------- -------- ----------
Current 9.7 7.2 35.0 10.6
------------------------- --------- --------- -------- ----------
Non-current 3.1 1.2 158.0 3.5
------------------------- --------- --------- -------- ----------
m EUR 1--3/2023 1--3/2022 Change % 1--12/2022
---------------------- --------- --------- -------- ----------
BY SEGMENT
---------------------- --------- --------- -------- ----------
AMERICAS 1.8 1.7 8.7 7.0
---------------------- --------- --------- -------- ----------
APAC 0.3 0.4 -16.7 1.5
---------------------- --------- --------- -------- ----------
EMEA 2.7 2.3 13.8 10.8
---------------------- --------- --------- -------- ----------
Total 4.8 4.4 9.3 19.3
---------------------- --------- --------- -------- ----------
BY OPERATION
---------------------- --------- --------- -------- ----------
Subscription sales 2.6 2.0 27.6 8.7
---------------------- --------- --------- -------- ----------
License sales 0.2 0.3 -51.6 1.9
---------------------- --------- --------- -------- ----------
Maintenance sales 1.9 1.9 0.2 8.2
---------------------- --------- --------- -------- ----------
Professional services
& others 0.1 0.1 8.7 0.4
---------------------- --------- --------- -------- ----------
Total 4.8 4.4 9.3 19.3
---------------------- --------- --------- -------- ----------
SSH Communications Security provides alternative performance
measures which are not defined by IFRS standards. Alternative
performance measures should not be considered substitutes for
performance measures in accordance with the IFRS. The alternative
performance measures are:
EBITDA = Operating profit/loss + depreciation and
amortization.
Recurring Revenue, ARR: Subscription + maintenance revenue at
the end of the last month of the reported period multiplied by
12.
Subscription ARR: Subscription revenue in the last month of a
reported period multiplied by 12.
Deferred Revenue: Non-recognized revenue from invoiced
maintenance and subscription sales.
Business outlook for 2023 (unchanged)
Our business transition from license and support to a
recurring-revenue model has continued providing a more stable
revenue base. At the end of 2022, our Annual Recurring Revenue was
EUR 18.4 million (EUR 15.4 million in 2021). Our net sales grew by
21% to EUR 19.3 million in 2022. Going into 2023, we will continue
to focus on increasing the average deal size. We expect net sales
to grow during 2023 compared to 2022. We estimate EBITDA and cash
flow from operating activities to be positive for 2023.
CEO review
Valued shareholders, customers, partners, and colleagues,
SSH's first quarter of the year delivered stable development
with many activities done for higher future growth. Our net sales
increased by 9% compared to Q1 2022, reaching EUR 4.8 million, and
EBITDA remained positive at EUR 0.2 million (EUR 0.5 million).
Additionally, cash flow from operations increased to EUR 2.0
million (EUR 0.8 million).
Recurring revenue accounted for 95% of total revenue in Q1, and
Annual Recurring Revenue (ARR) grew by 12% year-on-year, reaching
EUR 18.3 million, of which EUR 10.3 million is from
subscription-based revenue. Quarter-on-quarter ARR declined
slightly due to negative currency effects. Our transition to a
subscription-based revenue model provides greater predictability
and stability to our revenue streams, enabling us to better serve
our customers with ongoing support and access to the latest
features and updates.
Strong Investments in R&D
Our R&D investments in the growth and renovation of our
secure email tool Deltagon continued throughout the year's first
quarter. The public sector worldwide is under intense pressure to
move towards more encrypted and secure communications at all
levels. In response to the development of secure human-to-human
communications needs, we expanded the focus of our R&D efforts
to the entire Deltagon Suite, updating it with secure real-time
messaging options and improvements to the usability and user
experience.
Our mission to position ourselves as a leading Quantum-Safe
solution provider continued to prioritize our research and
development efforts to strengthen our quantum-safe solutions
portfolio. As a result of these efforts, we launched a new version
of Tectia during the quarter that provides quantum-safe
communication for the US federal government. The government's role
as a transformational leader has led to other actors in both the
public and private sectors following their lead. There is a
significant increase in global interest in post-quantum
cryptography, and financial sector customers have started to
purchase our quantum-safe products.
Identity-based access management on the rise
We have successfully updated PrivX with identity base access
possibilities and secured our first significant identity-based
privileged access management deal in Asia with a managed service
provider. This opens a new market opportunity for us in providing
real passwordless and keyless privileged access management tools.
Identity-based access management helps businesses maintain optimal
data security by ensuring the appropriate users get access to only
the information essential to their role and can establish secure
authentication and authorization methods based purely on unique
parts of user's identities.
We are also building a comprehensive family of modular security
software solutions called Zero Trust Suite together with our
partners. The Zero Trust Suite is being built around PrivX to apply
its unique just-in-time, and passwordless access management prowess
to all our use cases.
Going forward
Our 2023 guidance remains unchanged. Recognition of three
megatrends in the cybersecurity landscape - Zero Trust (ZT),
Operational Technology (OT), and Quantum-Safe (QS) has proven to
work, and we continue focusing on these with high expertise and
solid confidence.
SSH Communications Security will release its Interim Report for
the second quarter of the year on July 20, 2023.
Helsinki, April 26, 2023
SSH Communications Security Corp.
Board of Directors
Teemu Tunkelo
CEO
For further information, please contact:
Teemu Tunkelo, CEO, tel. + 358 40 549 9605
Michael Kommonen, CFO, tel. +358 40 183 5836
Distribution:
NASDAQ Helsinki Ltd.
Major media
www.ssh.com
Disclaimer
The contents of this report are provided by SSH Communications
Security and its third-party content providers for your personal
information only and do not constitute an offer or invitation to
purchase any securities nor does this report provide any form of
advice (investment, tax, legal) amounting to investment advice nor
make any recommendations regarding particular investments or
products. SSH Communications Security does not provide investment
advice or recommendations to buy or sell its shares or the shares
of others. If you are interested in investing in SSH Communications
Security, please contact your financial adviser for further details
and information. Past performance of SSH Communications Security
shares is not indicative of future results. EXCEPT AS PROVIDED BY
APPLICABLE COMPULSORY LAW SSH COMMUNICATIONS SECURITY EXPRESSLY
DISCLAIMS ALL WARRANTIES, EXPRESSED OR IMPLIED. AS TO THE
AVAILABILITY, ACCURACY, OR RELIABILITY OF ANY OF THE CONTENT
PROVIDED, OR AS TO THE FITNESS OF THE INFORMATION FOR ANY PURPOSED,
OR AS TO THE FITNESS OF THE INFORMATION FOR ANY PURPOSE.
Attachment
-- SSH COMMUNICATIONS SECURITY CORPORATION'S BUSINESS REVIEW JANUARY - MARCH
2023 (Q1)
https://ml-eu.globenewswire.com/Resource/Download/d8963d61-7060-40b0-b799-d0934c78d876
(END) Dow Jones Newswires
April 26, 2023 02:00 ET (06:00 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
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