TIDMSSH1V 
 
 
   SSH COMMUNICATIONS SECURITY CORPORATION          STOCK EXCHANGE RELEASE 
FEBRUARY 18, 2021, AT 9:00 A.M 
 
   SSH COMMUNICATIONS SECURITY CORPORATION FINANCIAL STATEMENT RELEASE 
JANUARY 1 -- DECEMBER 31, 2020 
 
   ANNUAL SALES DECREASED, QUARTERLY OPERATING CASH FLOW NEUTRAL 
 
   October--December 2020: Net sales decreased 28.4 % compared to the 
previous year. Planned growth investments impacted the EBITDA 
negatively. The loss for the period was also impacted by exchange rate 
fluctuations and write-downs of bad debts. 
 
 
   -- Net sales totaled EUR 3.0 million (10--12/2019: EUR 4.1 million) 
 
   -- EBITDA was EUR -0.8 million (EUR 0.4 million) 
 
   -- Operating loss was EUR -1.3 million (EUR -0.1 million) 
 
   -- Loss for the period was EUR -1.6 million (EUR -0.5 million) 
 
   -- Earnings per share was EUR -0.05 (EUR -0.02) 
 
 
   January--December 2020: Net sales decreased 21.7 % compared to the 
previous year. 
 
 
   -- Net sales totaled EUR 11.3 million (1--12/2019: EUR 14.4 million) 
 
   -- EBITDA was EUR -0.4 million (EUR 0.9 million). 
 
   -- Operating loss was EUR -2.5 million (EUR -1.2 million) 
 
   -- Loss for the year was EUR -3.1 million (EUR -1.5 million) 
 
   -- Earnings per share was EUR -0.11 (EUR -0.06) 
 
 
   Operating cash flow was EUR -0.2 million (EUR 0.3 million), and our cash 
position remained strong. Equity ratio remained good at 69.7 % (78.0 %). 
Liquid assets at year-end were EUR 8.5 million (EUR 12.0 million). 
Operating loss included EUR -0.3 million of restructuring expenses. 
 
   BUSINESS OUTLOOK FOR 2021 
 
   We expect our net sales to increase significantly during 2021. We are 
accelerating our transition from license and support services sales to a 
recurring-revenue business model, which we expect will provide more 
stable revenue in the long term. 
 
   Even though the growth strategy will require operational investments, we 
estimate EBITDA and cash flow from operations to be positive for 2021. 
 
 
 
 
 
 
KEY FIGURES 
 
EUR million             10--12/2020  10--12/2019  Change %  1--12/2020  1--12/2019  Change % 
 
Net sales                       3.0          4.1     -28.4        11.3        14.4     -21.7 
EBITDA                         -0.8          0.4    -276.4        -0.4         0.9    -145.5 
  % of net sales              -25.5         10.4    -346.4        -3.5         6.0    -158.2 
Operating profit/loss          -1.3         -0.1     885.6        -2.5        -1.2     105.9 
  % of net sales              -44.2         -3.2   1 276.4       -22.1        -8.4     163.1 
Profit/loss before 
 taxes                         -1.6         -0.4     327.0        -3.1        -1.3     130.8 
Profit/loss                    -1.6         -0.5     223.8        -3.1        -1.5     107.2 
 
Return on equity, 
 %                                                               -30.0       -11.3    -165.3 
Return on investment, 
 %                                                               -27.3        -9.8    -177.8 
Liquid assets                                                      8.5        12.0     -28.8 
Gearing (%)                                                      -85.3       -92.3       7.5 
Equity ratio (%)                                                  69.7        78.0     -10.6 
 
Earnings per share, 
 EUR                          -0.05        -0.02    -170.9       -0.11       -0.06     -81.8 
Shareholders' equity 
 per share, EUR                0.22         0.31     -29.7        0.22        0.31     -29.7 
 
 
   SSH Communications Security provides alternative performance measures, 
which are not defined by IFRS standards. Alternative performance 
measures should not be considered as substitutes for performance 
measures in accordance with the IFRS.  From the first quarter of 2020 
onwards, SSH Communications Security has introduced the following new 
alternative performance measures: 
 
   EBITDA = Operating profit/loss + depreciation and amortization 
 
 
 
   CEO REVIEW 
 
   Valued shareholders, customers, partners, and co-workers, 
 
   The year 2020 was an exceptional one due to the prevailing economic 
uncertainty. This had a negative effect on our license sales and our net 
sales decreased compared to last year. However, during the fourth 
quarter, we started to see positive developments and revenue growth 
compared to the previous quarter. 
 
   2020 was very much about re-setting and re-thinking our short-term 
strategy as well as working closer with our key customers and improving 
our processes. Our focus was on making investments and taking actions to 
drive growth going ahead. 
 
   Our strategy gained traction during the fourth quarter resulting in 
several business highlights: 
 
   --    Won a major multi-year deal for supplying cryptographic products 
and services with a value of up to EUR 20 million 
 
   --    Signed our 70(th) PrivX customer 
 
   --    Made our first NQX deployment to a private sector customer 
 
   --    Secured several renewal and new Tectia z/OS deals 
 
   --    Received a large follow-on UKM license order from a Fortune 200 
financial institution 
 
   Q4 net sales were EUR 3.0 million (EUR 4.1 million), down 28 %. The 
decline was mainly due to a decrease in license and professional service 
sales. Subscription sales grew both quarter-on-quarter and year-on-year. 
While the overall growth of the subscription revenue category was 
relatively small due to expired UKM subscriptions, we saw PrivX 
subscription sales triple compared to 2019. 
 
   We were able to restructure our US operations effectively and without 
disruption to operations making it possible to start 2021 with a ready 
and able organization. We continued recruitment and our investment 
program in inbound and outbound marketing during the quarter. 
 
   Operating loss for the quarter was EUR -1.3 million (EUR -0.1 million) 
and the loss for the quarter was EUR -1.6 million (EUR -0.5 million). 
The loss was impacted by nearly EUR -0.8 million in bad debts and 
exchange rate losses. 
 
   Quarterly cash flow from operations was EUR -0.0 million (EUR 0.2 
million). Our balance sheet and cash position remain strong and allow us 
to proceed with the execution of our strategy. 
 
   In regional terms, software sales in the APAC region grew 4.5% 
year-on-year, showing signs of recovery. The EMEA region declined by 
17.1%, and the AMER region sales were down by 40.5%. AMER remained our 
largest region with 49% of sales. EMEA grew to 35% and APAC was third at 
16% of total sales. 
 
   Deltagon acquisition 
 
   We announced the acquisition of Deltagon Oy, a leading provider of 
secure messaging and transaction solutions. With the acquisition, SSH 
gains a new, profitably growing subscription-based business, a strong 
position in the Nordic security messaging market, and a solid customer 
base. 
 
   The acquisition strengthens our position as a provider of secure 
networking and messaging solutions that safeguard our customers' key 
cybersecurity interests and offer security-critical networking, 
encryption, and other solutions to the private and public sector in a 
coordinated manner. The acquisition also supports our aim to build a 
core national cybersecurity and cryptography competence center around 
our NQX business. 
 
   The acquisition of Deltagon delivers on our strategy of moving towards a 
subscription-based business model. This makes the business more 
predictable as the relative importance of the more volatile license 
sales decreases. After the transaction, approximately 70 percent of our 
sales will come from recurring maintenance and subscription revenue. 
 
   We will fully consolidate Deltagon after the expected closing of the 
transaction during the first half of 2021. The acquisition is estimated 
to accelerate our revenue growth and improve our operating profit and 
cashflow from operations. 
 
   A fresh restart 
 
   During my first nine months steering SSH, all hands of our 
hundred-strong global team have been on deck building a strong 
foundation for sustainable growth. 
 
   We have clarified and focused our strategy for 2021-2022. We have 
flattened and streamlined our organization for faster execution and 
improved accountability. We have moved our focus closer to our customers 
and improved our response to their changing needs driven by the 
underlying technology changes like introduction of cloud applications. 
Today we operate through three regions with increased agility. We have 
recruited more sales personnel, product managers and engineers. We are 
strengthening our professional services business to better support 
license and subscription sales at our key customers. We have increased 
our investment into our traditional products Tectia and UKM. 
 
   We have a new board and a new largest owner who are supporting our 
growth strategy. 
 
   Looking ahead 
 
   At the center of our plan are new and scalable in-house products PrivX 
and NQX, which will expand their roles in our portfolio, and we welcome 
the additions to the portfolio from the Deltagon acquisition. This 
enables us to offer comprehensive cybersafety solutions to our customers 
globally. We will continue selectively to develop our patent portfolio. 
 
   Our focus is on growth during 2021 and 2022 both organically and 
inorganically. The large cryptography contract announced in December and 
the Deltagon acquisition announced in January are the first steps on our 
journey forward. We are strengthening our position with key customers 
through a wider portfolio of SSH products and related professional 
services. 
 
   Teemu Tunkelo 
 
   CEO 
 
   CONSOLIDATED NET SALES 
 
   Consolidated net sales for October--December totaled EUR 3.0 million 
(EUR 4.1 million). 
 
   Consolidated net sales for January--December totaled EUR 11.3 million 
(EUR 14.4 million), a decrease of 21.7 %, year on year. 
 
   The Americas region accounted for 52.8 % (54.3 %); the Europe, Middle 
East, and Africa region 28.3 % (25.3 %); and the Asia Pacific region 
18.9 % (20.4 %) of reported net sales. 
 
 
 
 
EUR million                 10--12/2020  10--12/2019  Change %  1--12/2020  1--12/2019  Change % 
 
BY SEGMENT 
  AMERICAS                          1.4          2.4     -40.5         5,9         7.8     -23.9 
  APAC                              0.5          0.5       4.5         2.1         2.9     -27.4 
  EMEA                              1.0          1.2     -17.1         3.2         3.6     -12.6 
  Total                             3.0          4.1     -28.4        11.3        14.4     -21.7 
--------------------------  -----------  -----------  --------  ----------  ----------  -------- 
 
BY OPERATION 
    Subscription sales              0.2          0.2      15.2         0.8         0.7       8.1 
    License sales                   0.6          1.5     -62.3         2.2         4.5     -49.7 
    Maintenance sales               1.7          2.1     -17.2         7.8         8.6      -9.6 
    Professional services 
     & others                       0.4          0.3      47.8         0.4         0.6     -24.2 
  Total                             3.0          4.1     -28.4        11.3        14.4     -21.7 
--------------------------  -----------  -----------  --------  ----------  ----------  -------- 
 
 
   The majority of SSH Communications Security's invoicing is US dollar 
denominated. During the financial year, the average exchange rate of the 
US dollar against the euro declined by 1.9 % compared to 2019. With 
comparable exchange rates, the net sales reduction in 2020 would have 
been 20.8 % compared to 2019. 
 
   RESULTS AND EXPENSES 
 
   Operating loss for October--December was EUR -1.3 million (EUR -0.1 
million), with net loss totaling EUR --1.6 million (EUR -0.5 million). 
 
   Operating loss for January--December was EUR -2.5 million (EUR -1.2 
million), with net loss totaling EUR -3.1 million (EUR -1.5 million). 
 
   Sales, marketing, and customer support expenses for October--December 
amounted to EUR -2.2 million (EUR -2.1 million), while research and 
development expenses totaled EUR -1.3 million (EUR -1.4 million) and 
administrative expenses EUR -0.8 million (EUR -0.8 million). 
 
   Sales, marketing, and customer support expenses for January--December 
amounted to EUR -6.7 million (EUR -7.5 million), while research and 
development expenses totaled EUR -5.0 million (EUR -4.9 million) and 
administrative expenses EUR -2.7 million (EUR -2.9 million). Operating 
expenses decreased by 5.1 % compared to the previous year. 
 
   BALANCE SHEET AND FINANCIAL POSITION 
 
   The financial position of SSH Communications Security was stable during 
the financial year. The consolidated balance sheet total on December 31, 
2020, was EUR 18.6 million (December 31, 2019: EUR 23.8 million), of 
which liquid assets accounted for EUR 8.5 million (December 31, 2019: 
EUR 12.0 million), or 45.7 % of the balance sheet total. 
Interest-bearing liabilities increased to EUR 1.3 million (December 31, 
2019: EUR 0.9 million) due to new rental contracts. Interest-bearing 
liabilities include a subordinated loan of EUR 0.6 million (December 31, 
2019: 0.6 million) taken out from the non-controlling interest holder 
State Security Networks Group Finland. On December 31, 2020, gearing, or 
the ratio of net liabilities to shareholders' equity, was -85.3 % 
(December 31, 2019: -92.3 %) and the equity ratio stood at 69.7 % 
(December 31, 2019: 78.0 %). 
 
   The reported gross capital expenditure for January--December totaled EUR 
2.1 million (EUR 2.0 million). The reported financial income and 
expenses in total to EUR -0.6 million (EUR -0.1 million) consisted 
mainly of exchange rate gains or losses and interest expenses sales and 
leasing contracts. 
 
   During January--December, SSH Communications Security generated a cash 
flow of EUR -0.2 million (EUR 0.3 million) from business operations, and 
investments showed a cash flow of EUR -1.5 million (EUR -1.1 million). 
Cash flow from investments includes government grants of EUR 0.6 million 
(EUR 0.9 million). Cash flow from financing totaled EUR -1.3 million 
(EUR -0.8 million). 
 
   There were no short-term investments at the end of the reporting period. 
 
   RESEARCH AND DEVELOPMENT 
 
   Research and development expenses for October--December totaled EUR -1.3 
million (EUR -1.4 million), the equivalent of 44.3 % of net sales (33.1 
%). During October--December, the company capitalized development costs 
in the amount of EUR 0.4 million (EUR 0.4 million). 
 
   Research and development expenses for January--December totaled EUR -5.0 
million (EUR -4.9 million), the equivalent of 44.9 % of net sales (34.0 
%). During January--December, the company capitalized development costs 
in the amount of EUR 1.3 million (EUR 1.6 million). Capitalized product 
development costs were reduced by the amount of EUR 0.4 million received 
as funding from the EU (2019: EUR 0.1 million). The depreciation of R&D 
capitalization assets was EUR -1.3 million (EUR -1.3 million). 
 
   HUMAN RESOURCES AND ORGANIZATION 
 
   At the end of December, the Group had 94 employees on its payroll 
(December 31, 2019: 90). The number of employees increased by four 
persons from the previous year (4.4 %). 
 
   At the end of the period, 33.0 % (35.6 %) of the employees worked in 
sales, marketing, and customer services, 51.1 % (51.1 %) in R&D, and 
16.0 % (13.3 %) in corporate administration. 
 
   BOARD AND AUDITORS 
 
   The Annual General Meeting of SSH Communications Security Oyj was held 
on March 26, 2020. The Annual General Meeting unanimously adopted the 
consolidated financial statements and discharged from liability the 
Board members and CEO who have been active during the accounting period 
between January 1, 2019, and December 31, 2019. Tatu Ylönen was 
re-elected, and Aino-Mari Kiianmies and Sampo Kellomäki were 
elected as new members of the Board of Directors. Tatu Ylönen was 
elected as the Chairman of the Board of Directors at the Board's 
organizing meeting. 
 
   The Authorized Public Accountants Ernst & Young Oy were re-elected as 
the auditor of the company. Ernst & Young Oy informed that Erkka 
Talvinko, Authorized Public Accountant, will continue to act as the 
principal auditor. 
 
   An Extraordinary General Meeting of SSH Communications Security Oyj was 
held on June 26, 2020. The Extraordinary General Meeting approved that 
number of members of the Board of Directors is five (5) and elected Tatu 
Ylönen, Aino-Mari Kiianmies, Sampo Kellomäki, Henri 
Österlund (new member) and Kai Tavakka (new member) as members of 
the Board of Directors. Henri Österlund was elected as the Chairman 
of the Board of Directors at the Board's organizing meeting. 
 
   SHARES, SHAREHOLDING, AND CHANGES IN GROUP STRUCTURE 
 
   The reported trading volume of SSH Communications Security shares 
totaled 19,431,318 shares (valued at EUR 24,937,080) during the year. 
The highest quotation was EUR 1.97 and the lowest EUR 0.65. The 
trade-weighted average share price for the period was EUR 1.28, and the 
share closed at EUR 1.70 (December 31, 2020). 
 
   Tatu Ylönen sold 6.4 million shares in SSH to the investment fund 
Accendo Capital on May 22, 2020, and a further 4.93 million shares on 
June 3, 2020. Accendo Capital became the largest shareholder of SSH, 
with 29.2 % of the company shares and votes. Tatu Ylönen is the 
second-largest shareholder of SSH after the sale with 18.0 % and Juha 
Mikkonen holds directly 5.2 % of the company's shares. More information 
about the shareholding can be obtained from the company's web site 
www.ssh.com. 
 
   No dividend or return of capital has been distributed during the 
reporting period. 
 
   SHARE CAPITAL AND BOARD AUTHORIZATIONS 
 
   The company's registered share capital on December 31, 2020, was EUR 
1,164,066.99, consisting of 38,802,233 shares. 
 
   The Annual General Meeting approved the Board of Directors' proposal to 
authorize the Board of Directors to decide upon the issuing of a maximum 
of 6,000,000 shares as a share issue against payment or by giving stock 
options or other special rights entitling to shares, in accordance with 
Chapter 10 Section 1 of the Finnish Companies Act, either according to 
the shareholders' pre-emptive right to share subscription or deviating 
from this right, in one or more tranches. Based on the authorization, it 
can be either issuing of new shares or transfer of own shares, which the 
company may have in its possession. 
 
   Based on the authorization, the Board of Directors shall have the same 
rights as the Annual General Meeting to decide upon the issuing of 
shares against payment and special rights (including stock options) in 
accordance with Chapter 10 Section 1 of the Finnish Companies Act. 
Thereby, the authorization to be given to the Board of Directors 
includes, inter alia, the right to deviate from the shareholders' 
pre-emptive rights with directed issues providing that the company has a 
compelling financial reason for the deviation with respect to the share 
issue against payment. 
 
   Furthermore, the authorization includes the Board of Directors' right to 
decide upon who is entitled to the shares and/or stock options or 
special rights in accordance with Chapter 10 Section 1 of the Finnish 
Companies Act as well as upon the related compensation, subscription and 
payment periods and the registering of the subscription price into the 
share capital or invested non-restricted equity fund within the limits 
of the Finnish Companies Act. 
 
 
 
   The authorization will be valid until the next Annual General Meeting, 
but will expire at the latest on June 30, 2021. 
 
 
 
   The Annual General Meeting approved the Board of Directors' proposal to 
authorize the Board of Directors to decide upon acquisition of a maximum 
of 2,000,000 own shares of the company with assets belonging to the 
company's non-restricted equity, which amounts to approximately 5.2 
percent of the company's total shares. The shares can also be acquired 
other than in proportion to the holdings of the existing shareholders. 
The maximum compensation to be paid for the acquired shares shall be the 
market price at the time of purchase, which is determined by public 
trading. 
 
   The Board of Directors proposes that the authorization for the acquiring 
of the company's own shares would be used, inter alia, in order to 
strengthen the company's capital structure, to finance and realize 
corporate acquisitions and other arrangements, to realize the 
share-based incentive programs of the company or otherwise to be kept by 
the company, to be transferred for other purposes or to be cancelled. 
The acquisition of shares reduces the company's distributable 
non-restricted equity. 
 
   A decision concerning the acquisition of own shares must be made so that 
the combined amount of the own shares, which are in possession of, or 
held as pledges by, the company or its subsidiaries does not exceed 
one-tenth of all shares. The Board of Directors shall decide upon all 
other matters related to the acquisition of shares. 
 
 
 
   The authorization will be valid until the next Annual General Meeting 
but will expire at the latest on June 30, 2021. 
 
   RISKS AND UNCERTAINTIES 
 
   The ongoing COVID-19 pandemic is a major new macro-level risk that may 
affect SSH Communications Security through challenges it poses to new 
license sales. The most substantial risks that might otherwise affect 
the profitability of the company have remained the same as in the 
previous reporting period and are listed below. 
 
   Largest risks: 
 
   - Uncertainty of the macroeconomic environment, such as the impact of 
COVID-19 
 
   - Cybercrime, including, e.g., ransomware 
 
   - Delays in product development and closing new business as well as 
phasing of new business cases 
 
   - Ability to execute the strategy 
 
   - Ability to retain and recruit key personnel 
 
   - Maintaining the ability to innovate and develop the product portfolio 
including intellectual property rights (IPR) 
 
   - IPR litigation and utilization of the patent portfolio 
 
   - A large portion of the company revenue is invoiced in USD currency, 
and possible significant fluctuation in USD currency rates during 2021 
could have unpredictable effects on profitability. The company decides 
on hedging of USD-based contracts case by case. 
 
 
 
 
 
   Principles and organization of risk management of SSH Communications 
Security are available on the company's web page: www.ssh.com. 
 
   RELATED PARTY TRANSACTIONS 
 
   During the reporting period, there have not been any significant 
transactions with related parties. 
 
 
 
   EVENTS AFTER THE BALANCE SHEET DATE 
 
   On January 29, 2021, SSH Communications Security Corporation's 
subsidiary, Kyberleijona Oy agreed to acquire all shares of Deltagon Oy 
from Leijonaverkot Oy, a subsidiary of Suomen Erillisverkot Oy. 
 
   Deltagon Oy develops and sells secure messaging and transaction 
solutions to various industries, including finance and the public 
sector. The acquisition strengthens SSH's position as a provider of 
secure networking and messaging solutions that safeguard key national 
cybersecurity interests and offer security-critical networking, 
encryption, and other solutions to the public sector in a coordinated 
manner. After closing, Deltagon becomes a subsidiary of Kyberleijona and 
part of the SSH group. The acquisition is expected to close during the 
first half of 2021, subject to regulatory approvals and fulfillment of 
customary closing conditions. 
 
   The total acquisition price is approximately EUR 15.4 million. The cash 
flow impact of the acquisition price to SSH is EUR 10 million over the 
next four years. The parties have also agreed on an earnout payment of 
no more than EUR 1.3 million, subject to certain conditions being 
fulfilled in the three-year period after the acquisition. 
 
 
 
 
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENT 
 
EUR million                                  10--12/2020  10--12/2019  1--12/2020  1--12/2019 
 
Net sales                                            3.0          4.1        11.3        14.4 
Cost of sales                                       -0.1         -0.1        -0.3        -0.5 
Gross margin                                         2.9          4.1        11.0        13.9 
Other operating income                               0.1          0.1         1.0         0.1 
 
Selling, marketing, and customer support 
 expenses                                           -2.2         -2.1        -6.7        -7.5 
Research and development expenses                   -1.3         -1.4        -5.0        -4.9 
Administrative expenses                             -0.8         -0.8        -2.7        -2.9 
Operating profit/loss                               -1.3         -0.1        -2.5        -1.2 
 
Financial income and expenses                       -0.3         -0.2        -0.6        -0.1 
Profit/loss before taxes                            -1.6         -0.4        -3.1        -1.3 
Taxes                                                0.0         -0.1         0.0        -0.1 
Profit/loss for the period                          -1.6         -0.5        -3.1        -1.5 
-------------------------------------------  -----------  -----------  ----------  ---------- 
 
Attributable to: 
    Owners of the parent company                    -1.5         -0.4        -2.8        -1.3 
    Non-controlling interests                       -0.1         -0.1        -0.2        -0.2 
                                                    -1.6         -0.5        -3.1        -1.5 
                                             -----------  -----------  ----------  ---------- 
 
Other comprehensive income 
    Items which might be later transferred 
     to profit or loss: 
    Foreign subsidiary translation 
     differences                                     0.2          0.1         0.3        -0.0 
Total comprehensive income                          -1.5         -0.4        -2.8        -1.5 
-------------------------------------------  -----------  -----------  ----------  ---------- 
 
 
Attributable to: 
    Owners of the parent company                    -1.4         -0.3        -2.6        -1.3 
    Non-controlling interest                        -0.1         -0.1        -0.2        -0.2 
                                                    -1.5         -0.4        -2.8        -1.5 
                                             -----------  -----------  ----------  ---------- 
 
Earnings per share 
Earnings per share (EUR)                           -0.05        -0.02       -0.11       -0.06 
Diluted earnings per share (EUR)                   -0.05        -0.02       -0.11       -0.06 
 
 
 
 
 
 
 
 
 
CONDENSED CONSOLIDATED BALANCE SHEET 
 
                                                  December   December 
EUR million                                        31, 2020   31, 2019 
ASSETS 
Non-current assets 
  Property, plant, and equipment                        0.1        0.1 
    Right-of-use assets                                 0.7        0.3 
  Intangible assets                                     5.4        5.5 
  Investments                                           0.0        0.0 
Total non-current assets                                6.3        5.9 
 
Current assets 
    Inventories                                         0.0        0.0 
  Trade and other receivables                           3.8        5.9 
    Financial assets                                    0.0        0.0 
  Cash and cash equivalents                             8.5       12.0 
Total current assets                                   12.3       17.9 
 
Total assets                                           18.6       23.8 
------------------------------------------------  ---------  --------- 
 
EQUITY AND LIABILITIES 
 
Equity 
  Attributable to parent company's shareholders         8.1       11.4 
  Non-controlling interest                              0.4        0.6 
Total equity                                            8.5       12.0 
 
Non-current liabilities 
    Borrowings                                          0.6        0.6 
    Lease liabilities                                   0.4        0.1 
    Advances received and deferred revenue              0.8        2.4 
------------------------------------------------ 
Total non-current liabilities                           1.7        3.0 
 
Current liabilities 
    Trade and other payables                            2.4        2.5 
    Lease liabilities                                   0.3        0.2 
    Advances received and deferred revenue              5.7        6.0 
------------------------------------------------ 
Total current liabilities                               8.4        8.7 
 
Total equity and liabilities                           18.6       23.8 
------------------------------------------------  ---------  --------- 
 
 
 
 
 
 
 
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN 
 EQUITY 
 
                              Attributable to the owners of the Company 
                             Hybrid                  Unrestricted 
                   Share     capital    Translation    invested    Retained          Non-controlling   Total 
EUR million       capital   securities   difference   equity fund   earnings  Total     interests      equity 
Equity Jan 1, 
 2019                 1.2         12.0         -1.4          22.7      -21.1   13.4              0.8     14.2 
 
Change                  -            -          0.0             -       -0.7   -0.7                -     -0.7 
Net profit                                                              -1.3   -1.3             -0.2     -1.5 
Equity December 
 31, 2019             1.2         12.0         -1.4          22.7      -23.0   11.4              0.6     12.0 
 
Change                  -            -          0.3             -       -0.8   -0.5                -     -0.5 
Net profit                                                              -2.8   -2.8             -0.2     -3.1 
Equity December 
 31, 2020             1.2         12.0         -1.2          22.7      -26.6    8.1              0.4      8.5 
 
 
 
 
 
 
CONDENSED CONSOLIDATED STATEMENT OF 
 CASH FLOWS 
EUR million                           1--12/2020  1--12/2019 
 
Cash flow from operations                   -0.2         0.3 
  whereof change in working capital          1.1        -0.6 
Cash flow from investing activities         -1.5        -1.1 
Cash flow from financing activities         -1.3        -0.8 
 
Increase (+) / decrease (-) in cash         -3.0        -1.6 
 
Cash at period start                        12.0        13.5 
Effect of exchange rate                     -0.4         0.1 
Cash at period end                           8.5        12.0 
 
 
 
 
   NOTES TO THE FINANCIAL STATEMENT RELEASE 
 
   This Financial Statement Release has been prepared in accordance with 
IAS 34 Interim Financial Reporting. The Financial Statement Release does 
not include all the information and disclosures required in the Annual 
Financial Statements. This Financial Statement Release has not been 
audited. 
 
   The accounting policies adopted for this interim report are consistent 
with those applied in 2019 consolidated financial statements except for 
the adoption of new standards effective as of January 1, 2020. The Group 
has not early adopted any standard, interpretation, or amendment that 
has been issued but is not yet effective. 
 
   Several amendments and interpretations apply for the first time in 2020, 
but do not have an impact on the interim condensed consolidated 
financial statements of the SSH Group. 
 
 
 
 
CHANGES IN PROPERTY, PLANT, AND EQUIPMENT 
 
                                            December   December 
EUR million                                  31, 2020   31, 2019 
Carrying amount in the beginning of 
 the period                                       0.1        0.2 
Increase                                          0.1        0.0 
Depreciation and impairment                      -0.1       -0.1 
Foreign exchange rate differences                -0.0        0.0 
Carrying amount at the end of the period          0.1        0.1 
------------------------------------------  ---------  --------- 
 
 
 
 
 
 
CHANGES IN RIGHT-OF-USE ASSETS 
 
                                           December   December 
EUR million                                 31, 2020   31, 2019 
Carrying amount in the beginning of 
 the period                                      0.3        0.5 
Increase                                         0.8        0.1 
Decrease                                           -       -0.0 
Depreciation and impairment                     -0.4       -0.3 
Foreign exchange rate differences               -0.0        0.0 
Carrying amount at the end of the period         0.7        0.3 
-----------------------------------------  ---------  --------- 
 
 
   Right-of-use assets include leased offices and software. Helsinki office 
moved to new premises in April 2020. The new lease contract is for the 
period of three years and added right-of-use assets and lease 
liabilities with EUR 0.6 million in 2020. The subsidiary in the United 
States moved to New York City at the end of 2020. Right-of-use assets 
and lease liabilities of EUR 0.1 million have been recognized for the 
new office. The lease agreement of the old office expires in September 
2021 and an impairment loss of EUR 29.2 thousand was recognized in the 
financial statements. 
 
 
 
 
CHANGES IN INTANGIBLE ASSETS 
 
                                           December   December 
EUR million                                 31, 2020   31, 2019 
Carrying amount in the beginning of 
 the period                                      5.5        5.2 
Increase                                         1.6        2.0 
Amortization and impairment                     -1.6       -1.7 
Foreign exchange rate differences                0.0        0.0 
Carrying amount at the end of the period         5.4        5.5 
-----------------------------------------  ---------  --------- 
 
 
 
 
 
 
CONTINGENT LIABILITIES 
 
                                        December   December 
EUR million                              31, 2020   31, 2019 
Interest on hybrid capital securities         1.0        0.7 
Rent security deposits                        0.2        0.1 
 
 
 
   KEY FIGURES AND RATIOS 
 
   SSH Communications Security provides alternative performance measures, 
which are not defined by IFRS standards. Alternative performance 
measures should not be considered as substitutes for performance 
measures in accordance with IFRS. From the first quarter of 2020 onwards, 
SSH Communications Security has introduced the following new alternative 
performance measures: 
 
   EBITDA = Operating profit/loss + depreciation and impairment 
 
 
 
 
KEY FIGURES AND RATIOS 
 
EUR million                        1--12/2020  1--12/2019 
Net sales                                11.3        14.4 
EBITDA                                   -0.4         0.9 
  % of net sales                         -3.5         6.0 
Operating profit/loss                    -2.5        -1.2 
  % of net sales                        -22.1        -8.4 
Profit/loss before taxes                 -3.1        -1.3 
  % of net sales                        -27.5        -9.3 
Return on equity (%)                    -30.0       -11.3 
Return on investment (%)                -27.3        -9.8 
Interest-bearing net liabilities         -7.2       -11.1 
Equity ratio (%)                         69.7        78.0 
Gearing (%)                             -85.3       -92.3 
Gross capital expenditure                 2.1         2.0 
  % of net sales                         18.8        13.9 
R&D expenses                             -5.0        -4.9 
  % of net sales                         44.9        34.0 
Personnel, period average                  88          88 
Personnel, period end                      94          90 
 
 
 
 
 
 
PER SHARE DATA 
 
EUR                                          1--12/2020  1--12/2019 
Earnings per share undiluted(1)                   -0.11       -0.06 
Earnings per share diluted(1)                     -0.11       -0.06 
Equity per share                                   0.22        0.31 
No. of shares at period average (thousand)       38 802      38 802 
No. of shares at period end (thousand)           38 802      38 802 
Share performance 
  Average price                                    1.28        1.34 
  Low                                              0.65        0.97 
  High                                             1.97        1.97 
Share price period end                             1.70        1.04 
Market capitalization period end (EUR 
 million)                                          65.8        40.2 
Volume of shares traded (million)                  19.4         5.3 
Volume of shares traded as % of total              50.1        10.2 
Value of shares traded (EUR million)               24.9         4.0 
Price per earnings ratio (P/E)                     neg.        neg. 
Dividend per share                                 0.00        0.00 
Dividend per earnings, %                           0.00        0.00 
Effective return on dividend, %                    0.00        0.00 
(1) Earnings per share is affected by unpaid 
 interest of hybrid capital securities 
 
 
 
   RECONCILIATION OF ALTERNATIVE PERFORMANCE MEASURES 
 
   The following table presents the reconciliation of EBITDA to the 
operating profit/loss. 
 
 
 
 
EUR million                   1--12/2020  1--12/2019 
EBITDA                              -0.4         0.9 
Depreciation and impairment         -2.1        -2.1 
Operating profit/loss               -2.5        -1.2 
----------------------------  ----------  ---------- 
 
 
 
   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 PURPOSE. 
 
   SSH Communications Security will release its Interim Report for the 
first quarter of the year on April 27, 2021. 
 
   Helsinki, February 18, 2021 
 
   SSH COMMUNICATIONS SECURITY 
 
   Board of Directors 
 
   Teemu Tunkelo 
 
   CEO 
 
   For further information, please contact: 
 
   Teemu Tunkelo, CEO tel. +41 79 227 8362 
 
   Niklas Nordström, CFO tel. +358 50 541 0543 
 
   Distribution: 
 
   NASDAQ Helsinki Ltd. 
 
   Major media 
 
   www.SSH.com 
 
 
 
 
 
 

(END) Dow Jones Newswires

February 18, 2021 02:00 ET (07:00 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.
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