Stable development for Norman

Norman ASA, the data security company, today announced its second quarter 2009 results. Sales revenue ended at NOK 67.2 million, which represent a 12% increase from the same quarter in 2008. EBITDA was NOK 5.0 million, up from NOK 1.7 million the previous year. The EBITDA margin for the second quarter was 7%, compared to 3% the same quarter last year.

Norman’s profit before tax for the second quarter ended at NOK 3.5 million, up from NOK 0.6 million the previous year.

For the first half of 2009, Norman posted sales revenues of NOK 142.3 million, which is an 11% growth over last year’s first half sales revenues of NOK 127.9 million. EBITDA for the first six months came in at NOK 19.9 million, compared to NOK 8.7 million last year. The results correspond to an EBITDA margin of 14% for the first six months. Pre-tax profit ended at NOK 17.1 million, up from NOK 5.8 million last year.

The financial results for the first half have been affected positively by currency fluctuations.

Core Security

Norman released its new core product Norman Endpoint Protection (NPRO) in the second quarter. NPRO represents the next generation Norman management tool with improved features, functionality and scalability. NPRO’s main customer groups are small and medium sized enterprises. NPRO is now being marketed and the initial response from the market has been good.

In the second quarter Norman signed a two way agreement with the US security vendor Lumension. According to the agreement, Lumension will include Norman’s Endpoint Protection products in its software offering under its own label. Lumension’s current software portfolio includes solutions for vulnerability assessment, patch management as well as application and device control. Lumension’s offering is a natural extension of Norman’s security solutions and will under the agreement be rebranded ‘Norman’ and included in Norman’s product portfolio.

The agreement with Fujitsu Siemens Computer related to bundling of Norman products in EMEA was terminated in the second quarter. The reason for the termination was lack of revenue generated after the 90 day free trial period.

OEM

Norman’s OEM business saw a more turbulent development in the second quarter. The Microsoft OEM agreement has been renewed for another 3 year term, but a less favourable royalty model will be implemented. Furthermore, F-secure, another significant OEM agreement for Norman has been terminated, effective from the third quarter. Consequently, Norman expects significantly reduced OEM revenue going forward.

Network Protection

In the Network Protection business area, the initiatives continue at building distribution channels for the Norman Network Protection product (NNP) into various verticals markets like ECM, production and education. The business area saw a steady positive development in the second quarter, also with new positive reviews in SC Magazine, UK and winning the 2009 Best Products and Services Award by the Network Products Guide.

Advanced Malware Analyzers

The business area Advanced Malware Analyzers saw a slowdown in the second quarter, due to the international economic crisis. No cancellations were filed, however a number of customers indicated that renewals has been postponed. Budgets are currently tight at a number of large enterprises, limiting the number of new sales in the second quarter. However, a number of customers suggest that their position is expected to be more positive in their new financial year which commences in Norman’s third quarter.

Finance

Norman’s financial position remains strong. The company has no interest bearing debt. Total cash at the end of the quarter amounted to NOK 84.2 million, which is down from NOK 104.8 million at the end the first quarter. Norman paid its shareholders a dividend of NOK 24.3 million in the quarter.

Norman faces no particular risk beyond what is considered normal for an international IT company.
The Company operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to EUR, CHF and USD. No transactions involving closely related parties having a significant impact on the Company’s financial position have occurred in the first half of 2009.
The Company had 192 employees at the end of the second quarter (186 employees 12 months previously).

Offer for Norman

At the end of the second quarter FSN Capital III Limited Partnership, through its subsidiary Ola Holding AS, announced its intention to submit an offer for all outstanding shares in Norman ASA at a price of NOK 28 per share. At the same time, Ola Holding announced that it had purchased Norman shares bringing its ownership to 67.81%.

Outlook

The outlook for the near future is somewhat uncertain, due to lower OEM revenues and the general market situation, in particular in the United States. However, this uncertainty is expected to be partly offset by the sales opportunities created by the NPRO release and traction in the NNP sales.

In the longer perspective, Norman is well positioned for increased sales. The world’s security threats continue to grow and the attacks become even more professional and targeted. The need for sophisticated security solutions is expected to remain high.

Enclosed is a summary of the interim financial statements for the second quarter 2009.
For further information, please contact: 

• Chairman of the board Svein Ramsay Goli (+47 9075 6757)
• CEO Trygve Aasland (+47 4153 9717)
• CFO Simen Nyberg-Hansen (+47 9820 6355)