Annual Report • Mar 15, 2022
Annual Report
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Annual Report 2021
Starting with an ingeniously safe internet protocol, SSH continues to help customers, in novel ways like abandoning password rotation or hiding them, to protect the customers from various quantum cybersecurity threats.
In the early days of internet, a smart open-source cryptography protocol solved a significant void in safeguarding the connections between various applications and their users.
We are very proud of our achievements in cryptography and defensive cybersecurity in the past and committed to o!er leading technology solutions for higher cybersafe future. We maintain our pioneering spirit, to the future. We are inventors, implementors and business people serving our customers e"ciently through their cybersecurity journey.
We serve our customers with proven-in-use and future-proof technologies that keep global ecosystems safe.
Culture of innovation, accountability and determination are key cornerstones when working for our remarkable customers.
Defensive cyber security technologies are developing towards third and fourth generations of cyber protection away from static passwords and SSH keys towards real time access control.
Every business should define their cybersecurity maturity level and its ambition level in improving it in the rapidly evolving digitalizing world. First, the maturity starts with classifying their various data sets based on their sensitivity, criticality, and value for the business. Second, one needs to know in which system and country the data is stored. Third, the user groups need to be managed: Who and when can access various data pools on a system or cloud level? Finally, how well do you manage the lifecycle of your invisible digital keys?
Cybercrime is increasing, and the 'new normal' working circumstances have increased remote work, thus increasing the volume of valuable data travelling through the internet.
Sensitive data in wrong hands threatens people, companies and governmental bodies. This all leads to a threat to the civil order of nations.
In 2021, the Colonial Pipeline ransomware attack caused fuel shortages in the southern USA. Twitch security breach uncovered their client details to a malicious third party. 500 supermarkets were forced to shut down in Sweden due to a ransomware attack in the USA. The German air conditioning, heating and exhaust system builder Eberspächer fell victim to an organized cyberattack and needed to close their factories and o"ces. A Finnish private psychotherapy practice Vastaamo patients got blackmailed by organized crime following a data breach in 2018.
All the above could have been avoided with more mature cybersecurity practices and processes based on SSH portfolio of products and solutions.
The maturity of SSH key management, certificate management and data access management and control practices for cybersafe operations in factories, o"ces and government agencies define the resilience of reallife activities impacted by the increasing digitalization.
We can help with leading-edge technologies to improve your cybersafe posture now and in the future.
Our PrivX and Zero Trust solutions remove the requirement to change your passwords regularly. Super- and power users are managed separately from traditional users due to a higher risk for major data leakages. These users are managed as access groups removing the manual work needed to grant or remove access individually. Inter-application communication and key users' access control happens constantly in real-time and enables automation, auditing and monitoring services.
Zero Trust removes one of the most annoying features of the current cybersecurity practices, static passwords, and their forced periodical change process.
Passwords as we know them are coming to an end. Data and file storage, use and sharing can be safeguarded in a more modern, fast, and yes, safer way. It is like the music world moving from CDs to streaming.
Trust is not supposed to be a business commodity. Trust is not on sale.
Zero Trust means Zero Risk. It gives just the right amount of access (JEA) in a just in time (JIT) fashion. It protects a multitude of various data pools from unwanted visitors. Passwords and keys are transformed into automatically managed certificates that exist on-need-to-know-bases only. It's revolutionary, and it gives trust back to where it belongs, to human life and relationships, away from business and digital security
that will be managed with automation instead of manual work.
Quantum computing is starting to fundamentally change the computers as we know them today. They also will change the requirements for data security. It has been predicted that with quantum computing, within 10 years from now, all our current cryptographic algorithms can be cracked in a few seconds. First Quantum Safe Cryptography solutions from SSH are available now. We have released and started to sell Quantum safe products in our NQX and Tectia product families.
Our acquisition of Deltagon in the spring of 2021 and the subsequent development of the Deltagon Suite has brought a new, sleek and powerful set of sensitive data collection, sharing, signing and mailing products into our portfolio. It has also significantly strengthened our position on the SSH home markets with a wider o!ering to our key markets.
Our flagship product family Tectia, the leading commercial secure shell (SSH) product, has already protected for decades millions of users and applications in the world safeguarding yearly hundreds of millions of sensitive digital communications sessions. SSH protocol powers over 95% of servers existing on the internet. SSH makes it possible to build secure channels over unsecure networks.
Today and tomorrow, the SSH Zero Trust and Quantum safe solutions for our UKM, NQX, Deltagon, PrivX and Tectia products will enable significant improvement of our customers' cybersecurity posture.
2021 was a remarkably good for us. We helped to improve the cybersafety of our customers' systems, applications, and key users. Now we have a solid foundation for growth at least for the next 25 years. SSH Communication Security will continue to o!er best-ofbreed cryptography and cyberssafe solutions for the ever-digitalizing world.
Dear Reader, we hope You do enjoy reading our Annual Report 2021 and like our products and financial results. Let us all bring digitalizing societies and businesses towards a better cybersafe future.
2 TECHNOLOGY AND THOUGHT LEADERSHIP IN CRYPTOGRAPHY AND CYBERSECURITY
5 CONTENTS 6 KEY FIGURES
7 2021 HIGHLIGHTS
10 FUTURE-PROOF
12 STRATEGY 2022
15 EXEMPLARY NOVEL CYBER SOLUTIONS
17 CEO LETTER
18 BOARD OF DIRECTORS
20 EXECUTIVE MANAGEMENT TEAM 31 DEC 2021
21 FINANCIAL STATEMENTS 2021
22 REPORT OF THE BOARD OF DIRECTORS FOR 1 JAN – 31 DEC 2021
32 CONSOLIDATED FINANCIAL STATEMENTS
57 PARENT COMPANY FINANCIAL STATEMENTS
67 DIVIDEND PROPOSAL AND SIGNATURES
68 AUDITOR'S REPORT
73 CORPORATE GOVERNANCE
74 BUSINESS ETHICS AND SOCIAL RESPONSIBILITY
SHAREHOLDERS
77 CONTACT INFORMATION
2021 was an exceptional year for us. We expanded our portfolio, changed our business model to recurring revenue, we expanded from point products to solutions business, we revitalized our regions and professional services o!ering and thanks to all this we delivered on all of our financial metrics.
2021 was first step in our strategy to focus on leveraging our whole portfolio for profitable growth. We are very satisfied how this year finally showed the results of our e!orts.
| KEY FIGURES | FY18 | FY19 | FY20 | FY21 | |
|---|---|---|---|---|---|
| Net sales | M€ | 18.3 | 14.4 | 11.3 | 15.9 |
| EBITDA | M€ | 0.9 | -0.4 | 1.1 | |
| % | 6.0 | -3.5 | 7.0 | ||
| Operating profit | M€ | 0.5 | -1.2 | -2.5 | -1.5 |
| % | 3.0 | -8.4 | -22.1 | -9.6 | |
| Profit | M€ | 0.5 | -1.5 | -3.1 | -2.3 |
| Personnel | 85 | 90 | 94 | 123 |
Entensive investment in the regions to Sales and Marketing
PrivX OT and MSP Editions released
Federated organization consisting of Regions, Products and Share Services implemented
Deltagon acquisition completed
Quantum safe NQX PQC edition released
Largest PrivX deal ever
SSH ANNUAL REPORT 2021 8
SALES AND MARKETS
Towards the end of 2021 several major contracts were signed taking the full year sales performance to significant growth (41.6%)
Subscription sales grew a staggering 511.2% supported by the Deltagon acquisition
The sales grew in EMEA region by 10.9%, AMER region grew 10.9% and APAC region declining by -21.9 %.
The resulting regional sales split was: AMER 41.4% (52.8 %), EMEA 48.2 % (28.3 %), and APAC 10.4% (18.9%).
PrivX development and sales proceeded well. We made 6 major releases during the year and increased the average dealsize significantly supported by the largest PrivX contract ever (0,9M€/a) at the end of the last quarter.
As part of our Strategy 2022, we increased investment in the development and sales of our UKM and Tectia product lines. The acquisition of Deltagon expanded our portfolio from the communication between applications and their users to also now include various communications between users and user groups.
All of our product lines performed well supported by our R&D investments to increase functionality relevant to selected customer groups and including elements of the third and fourth generation of defensive cybersecurity through our Zero Trust and Quantum Safe Editions of our existing products.
During the year, we strengthened our presence in Europe and USA, opened new o"ces and brought in new talent in digital marketing and sales in regions closer to our key customers than Finland.
We improved our capability to response faster to customers' rapidly changing requirements to support the change in underlying technologies namely Zero Trust and Quantum safe solution.
We moved from point products to wider solutions serving our customers' needs better.
Thanks to the Deltagon acquisition we had the opportunity to leverage cross- and up-sell opportunities in the Nordic for traditional SSH products and in the rest of the world for the Deltagon products.
The year proved that the new SSH is stronger together and has formed a solid foundation of future growth with a wider portfolio and more extensive market reach. Now 25% of our sales are in the nordic, so we do not anymore need to fly over the ocean to go fishing for more business.
In the fast-developing world of cryptography and defensive cybersecurity, it is of utmost importance for us to ensure the freshness of our products, solutions, and services portfolio. In this strategic process we look at our portfolio from two angles: 1) New market needs emerging with adequate business potential and 2) Future-proofness of our products, solutions, and services.
Our customers have an evolving need to protect their sensitive and valuable data and critical resources. We have identified three distinct stages in their evolution:
Stage 1: SSH started with users and applications with static passwords and SSH keys. These were needed to help applications to communicate with each other and with users managing them. These are similar to permanent access methods like physical keys to homes, cars, or hotel rooms.
Stage 2: Digitalization kicked in with "keyless" solutions e.g., for cars and as "key cards" in hotels and other facilities in the physical world - done by TSL/SSL certificates in the digital world. These solutions introduced systems that control, manage, and audit the "best-before-date" of those invisible digital keys, happening on a time scale of days, weeks, months or even years – on every website you visit.
Stage 3: Now we are moving to the third generation: control, monitor and audit access in real time with short-lived, so called 'ephemeral certificates' on an authenticated individual level. One doesn't anymore have a key or password, or a personal responsibility to keep it safe. This invisible digital key or password only belongs to a group of users who have predefined roles and accesses – a group member will not even have a password that they would have to remember to perform their duties at work.
Whilst many of our customers are still in stages 1 or 2, we see the industry moving towards stage three and are helping our customers to migrate from one stage to another in their evolution.
The future-proof concept has four elements safeguarding the ease-of-use, e"ciency, and success of our products in the rapidly changing cybertechnology environment, adapting to various interfacing technologies our customers want us to support.
Leading the adoption of the selected emerging technologies in cryptography and defensive cybersecurity: Currently the key topics for our customers are the Zero Trust concept and upcoming Quantum computing risks. Also the evolving message queue technologies are to replace our bread-and-butter business of secure file transfer between systems to message exchange between applications in the multitude of clouds and various datacenters.
Transition from point products to solutions: We have already launched our Zero Trust and Quantum Safe solutions to better serve specific market segments with adapted functionality and capabilities. We are constantly looking and adjusting our R&D roadmaps both for our individual products and cross-product solutions. Integration of SSH products with Certificate Authorities (CA) and Identity and Access Management (IAM): SSH Zero Trust products ensure that the users that have wider access to sensitive data – superusers and powerusers – can be controlled, monitored, and audited deeper and more e"ciently than standard users, supported by role-based access control.
Increased requirements from regulators and auditors on digitalization and the related risks of inadequate access control: With the support of Universal SSH Key Manager and PrivX products and solutions, our customers can address the questions related to data risks, such as:
We are also investigating the possibilities to connect the physical and digital access control by making sure that any user connecting to the network is verifiable through iris- or fingerprint recognition, either with a special smartcard or a mobile phone. With this additional measure, only knowing a PIN code or having a dongle cannot enable unauthorized access to the systems and applications.
During 2021 we revised our product positioning, strategies, and development roadmaps. Understanding the current and future emerging customer needs, as well as keeping the products technically and functionally future-proof, were key elements of that work and will be key elements of the next revisions. This will ensure the long-term market relevance for our products and solutions.
SSH is developing solutions that make the world a safer place for generations to come.
2020 we created the Strategy 2022 to accelerate our growth. 2021 our focus was on strategy execution, with demonstrated results during Q3-Q4.
We have made good progress in the transition from license and support services sales to a recurring revenue business model.
| THE STRATEGY 2022 IMPLEMENTATION ACTIVITIES | ACTIVITIES AND RESULTS |
|---|---|
| FOCUS ON LIGHTHOUSE CUSTOMERS | Established a capture team process for most import ant opportunities. Signed several new lighthouse customers. |
| IMPROVE THE PROCESS FROM RECEIVING CUSTOMER NEEDS TO DELIVERING CUSTOMER VALUE |
R&D Feature boards brought focus and better voice of-the-customer understanding to product devel opment. Launched several industry vertical specific product editions. |
| STRENGTHEN OUR SALES AND MARKETING | Strengthened sales and marketing in EMEA and Americas. |
| ENHANCE OUR ONLINE PRESENCE | Launched a new digital face, integrated SSH and Deltagon sites, increased investments in digital marketing. |
| EMPHASIZE PRODUCT SYNERGIES | Revised product positioning strategies and develop ment roadmaps Q1-Q2, with synergies and holistic solutions as a core element. |
| CONTINUE SHIFT TO SUBSCRIPTION MODEL | Share of subscription revenue increased from 1.2 to 7.3 M€ (521%). |
| GROW PROFESSIONAL SERVICES | Established a dedicated Professional Services unit. Refreshed PS portfolio. |
| OPERATIONAL EXCELLENCE | Launched major new process and IT initiatives (CRM, Customer Support, ERP). |
Zero Trust is rapidly becoming the security model of choice for enterprises and government entities.
In 2021, we have launched our Zero Trust Solution Suite, which was well received by our customers and already resulted in the first significant sales.
Frictionless key, password and secure remote access management
Don't leave any permanent credentials behind Reduce credential management overhead
Control privileged passwords and SSH encryption keys with unique just-in-time (JIT) and just enough access (JEA) models - without risky always-on authorization.
Radically reduce the number of keys and credentials to manage - along with manual tasks. Sync machine and human IDs with the
right roles with least privilege.
Audit, track, and log all sessions to any target in the hybrid cloud. Single sign-on (SSO) and multi-factor authentication (MFA) ensure added security.
We are a part of Finland's post-quantum era preparation
NQX is already PQC ready, Tectia Quantum is available Q2/2022
Externally acknowledged innovations
Certified for high security government use
Until quantum computers are widely available.
Do you have data in your organization that is still relevant after 5 to 10 years?
For a quantum computer to break encryption that is today unbreakable.
A marine vessel customer wanted to enhance their operational profitability. Connectivity from a public cloud environment to the critical fleet remained risky, though.
SSH helped the customer install a satellite communication system equipped with IoT sensors and supported by cloud-based analytics. With on-board computing, the remote access to and between vessels got much more transparent and sessions remarkably more visible. Linking of roles to identities was automatized. SSH's Just-In-Time (JIT) technology optimized how the access rights were granted.
The system in the cloud can be scaled, and therefore, the fleet can be easily expanded.
A manufacturing business was able to identify their own key management problem, even with a PAM solution in place that only covered the problem partly, with only 20% of the keys being managed. They were looking for an enhanced solution, to cover all 100% of the keys.
SSH came in place to o!er a double solution. Not only to fill in the customer's sinking PAM solution, but also to o!er something better: help the customer with its deep and thorough identification of the problem and its solution – and the conclusion thereafter. SSH was chosen because of its valued position as the inventor of the SSH protocol, and its proactive inventiveness.
The UKM Zero Trust radically reduces the number of SSH keys needing a management, ultimately enabling a keyless solution through ephemeral certificates – and freeing the customer from the troublesome, costly and time-consuming management problem. Today, the customer has fully migrated to a keyless, just-in-time, just-enough-access solution.
Currently, the customer adopted and fully migrated to keyless, just-in-time access. UKM helped the customer to solve their current challenge and, at the same time, it prepared the customer's environment for the keyless approach to SSH access management.
"SSH reshaped itself to be ready to serve customers better in the future.
World needs better defensive cybersecurity.
We can help with our Zero Trust and Quantum Safe technology based solutions that are provenin-use and future-proof."
The year 2021 was a significant step in our evolution to become a more growth focused company with solid performance in the market, with innovation, and financially.
We successfully acquired and integrated Deltagon, SSH's first acquisition ever, increasing our team by over twenty-five percent and accelerating our transition towards subscription-based business model. This acquisition made us stronger in our home market by widening our o!erings to customers in Finland and Sweden.
We reorganized our USA operations and strengthened our position in Europe by establishing our presence in the German- and French-speaking countries. We also strengthened our professional services team and further defined its role to support the total lifecycle of all our five product lines. During the year, we acquired over hundred new customers ranging from SMEs to Fortune 500 companies.
Our financial performance improved due to our great performance during the fourth quarter. PrivX continued its strong performance and UKM was successful in selling to existing and new Fortune 500 customers in Europe and USA. We achieved over forty percent growth in revenues and over seven percent EBITDA. Even with the Deltagon acquisition our cash position remained strong.
Our continued R&D investments are bearing fruit in all product lines. New versions of Tectia, UKM and PrivX have been well received by our customers and market analysts. With Deltagon we started to market a platform-based solution for safely sharing confidential information across organizational and country borders. NQX PQC version opens us new growing market with the increasing interest in Quantum Safe cryptography.
We are improving our ecosystem both downstream and upstream. We are energizing our channel partner network to increase our market reach and expand wider services to customers during various product lifecycles.
We are building new technology partnerships to o!er a wider solution for our key customers to make it easier, faster, and more a!ordable to build better solutions for their cybersecurity needs.
Our subscription-based business gives us a solid foundation for long-term growth. We firmly believe that our growth engines PrivX and NQX will continue their excellent growth trajectories and will gain a more significant part in our portfolio in 2022. Our Tectia and UKM, and Secure Deltagon Suite products, bring us closer to our customers with a wider product o!ering and a new di!erentiating functionality.
We achieved growth in 2021. We continue to drive for success in 2022 and beyond for our customers, our partners and SSH.
Teemu Tunkelo CEO
In the 2021 Annual General Meeting the following members were elected for the Board of Directors: Henri Österlund, Kai Tavakka, Sampo Kellomäki and Christian Fredrikson as a new member.
At the organizing meeting of the Board of Directors, Henri Österlund was elected as the Chairman of the Board of Directors.
HENRI ÖSTERLUND Chairman of the Board
Henri is the founder of Accendo Capital SICAV, which creates shareholder value through active ownership. Previously, Henri has served as a Partner of Conventum Corporate Finance, Partner of Triton Private Equity investment fund in London, and as an Analyst at Doughty Hanson Private Equity fund in Stockholm.
In addition to SSH board, he is a board member at Remedy (publ), Doro AB (publ), member of the board of Managers of Accendo Capital Managers S.à.r.l., owner of FERDINAND S.à.r.l. and Ferdinand Holdings S.L.U.
Henri owns holds a Master of Science degree in Economics from the Helsinki School of Economics (currently Aalto University).
Henri owns 61,060 SSH shares. He has no option rights.
CHRISTIAN FREDRIKSON
Board Member
Christian Fredrikson is the CEO of Fingerprint Cards, a global leader in biometric solutions. Deep knowledge of global commercialization of advanced technologies.
He has formerly served as the CEO of F-Secure, Head of Asia Pacific Region, and Head of Sales for Nokia Siemens Networks.
He currently also serves as a Board member on Remedy Entertainment, Advisor to Edge Venture Capital, and a member of the foundation for Åbo Akademi.
SAMPO KELLOMÄKI Board Member
Sampo has founded two software startups, Symlabs SA (identity management and directory services) and Synergetics SA (privacy and personal data management). He has also been an angel investor and director in other startups.
Sampo has contributed to identity management and identity federation standards and contributed to several cryptographic protocol implementations.
He has acted as Chief Technology O" cer (CTO) and leader of architecture and development. He has a strong background in cryptography, credential management, identity management, and privacy, and has contributed to several standards.
Sampo holds a Master of Science degree in Computer Science from Helsinki University of Technology (currently Aalto University).
Sampo neither owns any SSH shares nor has any option rights.
KAI TAVAKKA Board Member
Kai Tavakka (b. 1986) is a partner in Accendo Capital Managers S.à.r.l. since 2015 after working in the firm since 2012. Kai has a corporate finance background (PCA Corporate Finance, Danske Corporate Finance).
He is a CFA Charterholder, and he holds a Master's degree in Economics from Aalto University.
Kai neither owns any SSH shares nor has any option rights.
The majority of the Board members are considered independent of the company and two Board members are also independent of the significant shareholders of the company.
Board members Sampo Kellomäki and Christian Fredriksonare deemed to be independent of the company and the significant shareholders of the company.
Henri Österlund and Kai Tavakka are deemed independent of the company, but not independent of the significant shareholders of the company due to their role in Accendo Capital, which is the major shareholder of SSH.
Chief Executive O"cer born 1961 M.Sc. Engineering, PhD in Economics
Teemu is an international business leader who has served major companies, such as Voith, Siemens, ABB, Invensys, and Compaq in global management and technology leadership roles for 25 years in Zurich, London, Munich, Helsinki, and Cleveland (Ohio).
His prior experience also includes being CEO of Enfo (prev. Tietosavo), a software company of 300 people and a board member at Nixu, the largest cybersecurity consulting company in Finland.
At Voith, he created Voith digital solutions, a 2000-person strong business that combines IT, automation, and digital solutions. He holds an M.Sc. (Eng) in computer science and a Ph.D. in economics.
Teemu holds a Master of Science degree Helsinki University of Technology (currently Aalto University) in Finland and a Doctor of Philosophy degree from the University of Lausanne in Switzerland.
Teemu owns 77,043 SSH shares and has 425,000 option rights.
Chief Financial O"cer born 1979 Master of Laws, Bachelor of Economics
Niklas has brought with him over 10 years of cross-industry financial management experience gained from working in demanding senior financial roles in various NASDAQ companies. He is responsible for financial management, treasury, human resources, legal, corporate development, and corporate governance. Niklas is also the director of SSH's cryptographic solutions business.
Prior to joining SSH, Niklas worked as CFO for Biohit Oyj, a Helsinki-based public biotechnology company.
Niklas holds a Master of Laws degree from the University of Kent in Canterbury, UK, and a Bachelor of Economics, Accounting and Finance degree from the Inholland University of Applied Sciences in the Netherlands.
Niklas owns 4,619 SSH shares and has 279,000 option rights.
Vice President, EMEA born 1961 M.Sc. in Strategic Marketing, Business Economics and Computer Science.
Rami is a seasoned sales leader with a background of international leadership positions in sales and business management, marketing, product management and development in global companies.
He has developed and led regional and global sales teams for successful sales growth, and customer satisfaction, and loyalty. He is experienced in go-to-market strategy, implementation, and channel partner management.
He has worked in senior management positions in major companies including Ahlstrom, Aspocomp, ICL, Fujitsu, Fujitsu-Siemens, and Nokia.
Rami does not own any SSH shares but has 50,000 option rights.
AS OF DECEMBER 31, 2021
management team during 2021:
Jussi Mononen, Vice President, Business Development, 01-08/2021. He has left the company to pursue outside interests.
The following people also served in the executive
22 REPORT OF THE BOARD OF DIRECTORS FOR 1 JAN – 31 DEC 2021
39 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
57 PARENT COMPANY FINANCIAL STATEMENTS
67 DIVIDEND PROPOSAL AND SIGNATURES
68 AUDITOR'S REPORT
| NET SALES EUR million |
10–12/ 2021 |
7–9/ 2021 |
4–6/ 2021 |
1–3/ 2021 |
1–12/ 2021 |
10–12/ 2020 |
1–12/ 2020 |
|---|---|---|---|---|---|---|---|
| BY GEOGRAPHICAL SEGMENT | |||||||
| AMERICAS | 1.8 | 1.7 | 1.3 | 1.7 | 6.6 | 1.4 | 5.9 |
| APAC | 0.7 | 0.3 | 0.4 | 0.3 | 1.7 | 0.5 | 2.1 |
| EMEA | 3.5 | 1.9 | 1.6 | 0.6 | 7.7 | 1.0 | 3.2 |
| Total | 6.0 | 3.9 | 3.3 | 2.6 | 15.9 | 3.0 | 11.3 |
| BY OPERATION | |||||||
| Subscription sales | 1.7 | 1.6 | 1.1 | 0.2 | 4.7 | 0.2 | 0.8 |
| License sales | 1.7 | 0.4 | 0.4 | 0.5 | 3.1 | 0.6 | 2.2 |
| Maintenance sales | 2.2 | 1.8 | 1.7 | 1.8 | 7.6 | 1.7 | 7.8 |
| Professional services & others | 0.3 | 0.1 | 0.1 | 0.0 | 0.6 | 0.4 | 0.4 |
| Total | 6.0 | 3.9 | 3.3 | 2.6 | 15.9 | 3.0 | 11.3 |
Consolidated net sales for January–December totaled EUR 15.9 million (2020: EUR 11.3 million), an increase of 41.6 %, year on year.
The majority of SSH Communications Security's in- ]VPJPUNPZ<:KVSSHYIHZLK+\YPUN[OLÄUHUJPHS`LHY[OL average exchange rate of the U.S. dollar against the euro declined by 3.7 % compared to 2020. With comparable exchange rates, the net sales increase in 2021 would have been 44.3% compared to 2020.
6WLYH[PUNSVZZMVY[OLÄUHUJPHS`LHYHTV\U[LK[V,<9 million (2020: EUR -2.5 million), with net loss totaling EUR -2.3 million (2020: EUR -3.1 million).
Selling, marketing, and customer support expenses amounted to EUR -8.6 million (2020: EUR -6.7 million), while research and development expenses totaled EUR -5.8 million (2020: EUR -5.0 million) and administrative expenses EUR -4.1 million (2020: EUR -2.7 million). Operating expenses increased by 28.8 % compared to the previous year.
;OLÄUHUJPHSWVZP[PVUVM::/*VTT\UPJH[PVUZ:LJ\YP[^HZHKLX\H[LK\YPUN[OLÄUHUJPHSLHY;OLJVUZVSPKH[LK balance sheet total on December 31, 2021 stood at EUR 35.9 million (31 Dec 2020: EUR 18.6 million), of which liquid assets accounted for EUR 8.2 million (31 Dec 2020: EUR 8.5 million), or 22.8 % of the balance sheet total. Interest-bear-PUNKLI[Z^LYL,<9TPSSPVUH[[OLLUKVM[OLÄUHUJPHS year (31 Dec 2020: EUR 1.3 million). Interest-bearing liabilities increased by EUR 2.1 million from December 31, 2020 mainly due to raising a premium loan from ELO mutual pension insurance company. Interest-bearing liabilities include a subordinated loan of EUR 0.6 million (December 31, 2020: 0.6 million) taken out from the non-controlling interest holder, State Security Networks Group Finland, and a premium loan from ELO mutual pension insurance company for EUR
2.2 million. On December 31, 2021, gearing, or the ratio of net liabilities to shareholders' equity, was -39.8 % (31 Dec 2020: -85.3 %) and the equity ratio stood at 44.6 % (31 Dec 2020: 69.7 %).
The capital and interest of the subordinated loan, which Kyberleijona Oy has taken out from the non-controlling interest holder State Networks Group Finland, can only be repaid in circumstances permitted by Chapter 12 of the Finnish Limited Liability Companies Act. The capital of the subordinated loan can only be repaid to the extent the unrestricted shareholders' equity and the total amount of the subordinated loan, at the time of the re-payment, exceeds the loss that PZ[VILJVUÄYTLKMVY[OLJVTWHU»ZSH[LZ[ÄUHUJPHSLHY VYPZPUJS\KLKPU[OLIHSHUJLZOLL[VMTVYLYLJLU[ÄUHUJPHS statements. The annual interest for the loan, three per cent (3 %), has been recognized as expense.
The reported gross capital expenditure for the period totaled EUR 2.0 million (2020: EUR 2.1 million). Financial income and expenses totaled EUR -0.3 million (2020: EUR -0.6 million), which consisted mainly of exchange rate gains or losses and interest expenses from sales and leasing contracts.
;OL.YV\WOHKHJHZOÅV^VM,<9TPSSPVU! EUR -0.2 million) from business operations, and investments ZOV^LKHJHZOÅV^VM,<9 TPSSPVU!,<9 TPSSPVU*HZOÅV^MYVTPU]LZ[TLU[ZPUJS\KL[OLHJX\PZP[PVU of Deltagon Oy for EUR -4.6 million, and government grants VM,<9TPSSPVU!,<9TPSSPVU*HZOÅV^MYVT ÄUHUJPUN[V[HSLK,<9TPSSPVU!,<9TPSSPVU *HZOÅV^MYVTÄUHUJPUNPUJS\KLZ[OLWHTLU[VM[OLOIYPK instrument interest of EUR -1.4 million (EUR -0.9 million) and HJOHUNLPUKLI[VM,<9TPSSPVU;V[HSJHZOÅV^MYVT VWLYH[PVUZPU]LZ[TLU[ZHUKÄUHUJPUN^HZ,<9TPSSPVU (EUR -3.0 million).
Research and development expenses totaled EUR -5.8 million (2020: EUR -5.0 million), the equivalent of 36.6 % of net sales (2020: 44.9 %). During the reporting period, R&D cost capitalizations totaled EUR 1.4 million (2020: EUR 1.3 million). Capitalized product development expenses were reduced by the amount of EUR 0.4 million, received as funding from EU (2020: EUR 0.4 million). Depreciation from R&D capitalization assets was EUR -1.2 million (2020: EUR -1.3 million).
The ongoing COVID-19 pandemic remains a macro-level YPZR^OPJOPMWYVSVUNLKTHHɈLJ[::/\*VTT\UPJH[PVUZ Security through challenges it poses on new license sales. ;OLTVZ[Z\IZ[HU[PHSYPZRZ[OH[TPNO[V[OLY^PZLHɈLJ[[OL WYVÄ[HIPSP[VM[OLJVTWHU`OH]LYLTHPULK[OLZHTLHZPU the previous reporting period and are listed below.
UJLY[HPU[`VM[OLTHJYVLJVUVTPJLU]PYVUTLU[Z\JOHZ the impact of COVID-19 pandemic
YPZRZ\JOHZILPUN\UHISL[VWH VISPNH[PVUZK\L[VPUZ\ɉJPLU[SPX\PKP[`VYKPɉJ\S[PLZPU YHPZPUNÄUHUJPUN[VL\_LJ\[L[OLZ[YH[LN[VYL[HPUHUKYLJY\P[RLWLYZVUULSYL]LU\LPZPU]VPJLKPU <:+J\YYLUJHUKWVZZPISLZPNUPÄJHU[Å\J[\H[PVUPU<:+ currency rates during 2021 could have unpredictable LɈLJ[ZVUWYVÄ[HIPSP[;OLJVTWHUKLJPKLZVUOLKNPUN USD-based contracts case by case.The principles and organization of risk management of SSH Communications Security can be read from the company's website www.ssh.com.
SSH Communications Security Group had 123 (2020: 94) employees at the end of December, up by 29 persons or 30.9 % from the previous year. The average age among employees was 41 years (2020: 43 years). Approximately 15.7 % (2020: 15.8 %) of the employees were women and 84.3 % (2020: 84.2 %) men. At the end of the period under review, 38.2 % (2020: 33.0 %) of the employees worked in sales, marketing, and customer services, 52.8 % (2020: 51.1 %) in research and development, and 8.9 % (2020: 16.0 %) in corporate administration.
([[OLLUKVM[OLÄUHUJPHSWLYPVK[OLWHYLU[JVTWHU` had 81 (2020: 73) employees on its payroll. On average, the parent company had 76 (2020: 66) employees during the period under review. Parent company salaries, bonuses, and V[OLYWLYZVUULSL_WLUZLZK\YPUN[OLÄUHUJPHSWLYPVK[V[HSLK
EUR 6.6 million (2020: 5.7 million).
The Annual General Meeting of SSH Communications Security Oyj was held on March 25, 2021. Henri Österlund, Kai Tavakka, Sampo Kellomäki, and Christian Fredrikson (new member) were elected as directors of the company's Board of Directors. At the inaugural meeting of the Board of Directors, Henri Österlund was elected as the Chairman.
Authorized Public Accountants Ernst & Young Oy was re-elected as the auditor of the company with Erkka Talvinko, authorized public accountant, as principal auditor.
At the end of 2021, the Group Management Team consisted of three members:
;LLT\;\URLSV*OPLM,_LJ[P]L6ɉJLY 5PRSHZ5VYKZ[YT*OPLM-PUHUJPHS6ɉJLY Rami Raulas, Head of EMEA Region
According to the Articles of Association, the highest decision-making power in the company is wielded by the shareholders at the shareholders' meeting. The Annual General Meeting (AGM) is held within six months of the JVTWSL[PVUVM[OLJVTWHU`»ZÄUHUJPHSWLYPVKH[H[PTL decided by the Board. The AGM decides the number of members of the Board of Directors and elects them. Additionally, under the Finnish Limited Liability Companies Act, the AGM has the authority to amend the company's (Y[PJSLZVM(ZZVJPH[PVUHKVW[[OLÄUHUJPHSZ[H[LTLU[Z approve the amount of dividend, and select the company's auditors. Each SSH Communications Security Corporation share conveys one vote at the shareholder's meeting. Under the Articles of Association, the CEO is appointed by the Board of Directors.
SSH Communications Security abides by its Articles of Association as well as principles of transparent and responsible corporate governance, and high ethical standards in its governance and decision-making. The company complies with the Finnish company and securities market legislation, including the market abuse regulation, rules of Nasdaq Helsinki and Finnish Corporate Governance Code 2020 adopted by the Securities Market Association.
For more information see our Corporate Governance Statement that is published annually as a separate report and can be found at SSH's website.
SSH Communications Security is committed to systematically maintain and develop the responsibility and sustainability of business through its strategy, operations and actions. Company is committed to operate in socially and ethically responsible way.
The company's ethical principles emphasize values
that are important to SSH, such as antibribery, position and treatment of employees, and safety and behavioral culture within workplaces.
SSH Communications Security is responsible employer and treats all employees equally. Company does not approve harassment or discrimination in any form and for that the company has created internal guideline and organized training. Company constantly develops the safety and comfort of its workplaces as well as the management of work-related stress and coping with the workload. The company's headquarters in Helsinki moved to new, modern premises during spring 2020. In addition, the company VɈLYZP[ZLTWSVLLZWOZPJHSJ\S[\YHSHUKV[OLYILULÄ[Z
SSH Communications Security regards the diversity of its personnel as essential strength and encourages the appraisal and adoption of diversity throughout the organization including top management.
The company has a separate Anti-Bribery and Anti-Corruption Policy as well as equality plan focusing on equal and fair treatment of its employees.
The company has also a whistleblowing policy in place to ensure that employees and third parties, if they wish, can YLWVY[HUVUTV\ZSZ\ZWLJ[LKZLYPV\ZKLÄJPLUJPLZHI\ZLZ and crimes within the SSH Group.
SSH has established a Code of Conduct for responsible and transparent activities, employee satisfaction and ethics for all employees worldwide.
Companies that have less than 500 employees are exempt from the requirements to disclose information according to 9LN\SH[PVU,<VM[OL,\YVWLHU7HYSPHTLU[HUK of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment and amend-PUN9LN\SH[PVU,< [OL¸;H_VUVT9LN\SH[PVU¹ Therefore, SSH has not disclosed Taxonomy Regulation PUMVYTH[PVUPU[OLYLWVY[ZVMÄZJHSLHY
The reported trading volume of SSH Communications Security Corporation totaled 8,572,278 shares (valued at EUR 21,658,793). The highest quotation was EUR 3.48 and the lowest EUR 1.60. The trade-weighted average share price for the period was EUR 2.51 and the share closed at EUR 3.01 (December 31, 2021).
Accendo Capital is the largest shareholder of SSH, with 28.8% of the company shares and votes. Tatu Ylönen is the second largest shareholder of SSH with 17.8%, and Juha Mikkonen holds directly 5.1% of the company's shares. More information about the shareholding can be obtained from the company's web site www.ssh.com.
The company has the following subsidiaries:
ILYSLPQVUH3[K::/;LJOUVSVN Ltd., and Deltagon Ltd. in Finland. SSH Operations Ltd. has a branch in Germany. Deltagon Ltd has branches in Sweden and in Norway.State Security Networks Group Finland (Suomen Erillisverkot Oy) became a non-controlling interest holder of Kyberleijona Oy on August 14, 2018 with 35 % ownership. SSH Communications Security Oyj owns 65 % of the shares in Kyberleijona Oy.
On January 29, 2021, SSH announced the acquisition of Deltagon Oy through its subsidiary Kyberleijona Oy. The transaction was closed on April 26, 2021.
During the review period, no dividend or return of capital have been distributed.
| Type of sector | Number of shares | Percentage of shares and votes, % |
|---|---|---|
| Households and private individuals | 18,291,050 | 46.57 % |
| Financial and insurance institutions | 3,543,795 | 9.02 % |
| Public sector organizations | 3,184,157 | 8.11 % |
| Companies | 2,414,267 | 6.15 % |
| Foreign shareholders | 11,845,530 | 30.16 % |
| 5VUWYVÄ[VYNHUPaH[PVUZ | 100 | 0.00 % |
| Total | 39,278,899 | 100.00 % |
| Shares | Number of shareholders |
Percentage of shareholders, % |
Number of shares |
Percentage of shares, % |
|---|---|---|---|---|
| 1-100 | 1,994 | 38.99 % | 99,206 | 0.25 % |
| 101-500 | 1,431 | 27.98 % | 415,752 | 1.06 % |
| 501-1,000 | 617 | 12.07 % | 498,376 | 1.27 % |
| 1,001-5,000 | 763 | 14.92 % | 1,799,402 | 4.58 % |
| 5,001-10,000 | 136 | 2.66 % | 1,025,479 | 2.61 % |
| 10,001-50,000 | 132 | 2.58 % | 2,877,711 | 7.33 % |
| 50,001-100,000 | 20 | 0.39 % | 1,347,532 | 3.43 % |
| 100,001-500,000 | 11 | 0.22 % | 2,504,516 | 6.38 % |
| 500,001-999,999,999 | 10 | 0.20 % | 28,710,925 | 73.10 % |
| Total | 5,114 | 100.00 % | 39,278,899 | 100.00 % |
| of which nominee-registered | 9 | 15,155,598 | 38.59 % |
| Excluding Nominee Registered except Accendo Capital |
Percentage of shares, % |
Number of Shares |
|---|---|---|
| Accendo Capital | 28.85 % | 11,330,000 |
| Ylönen Tatu | 17.79 % | 6,987,123 |
| Mikkonen Juha Taneli | 5.09 % | 2,000,000 |
| Elo Mutual Pension Insur- ance Company |
3.96 % | 1,555,258 |
| Gaselli Group Oy | 2.41 % | 948,087 |
| Ilmarinen Mutual Pension Insurance Company |
2.22 % | 873,599 |
| Varma Mutual Pension Insurance Company |
1.92 % | 755,300 |
| Syrjälä Timo Kalevi | 1.33 % | 523,011 |
| Kettunen Risto Juhani | 1.19 % | 468,000 |
| Syrjänen Eva Annika Elisabeth |
0.88 % | 347,059 |
| Total | 65.64 % | 25,787,437 |
The registered share capital of SSH Communications Security Corporation on December 31, 2021 was EUR 1,178,366.97 consisting of 39,278,899 shares.
In 2021, share capital increased by EUR 14,300 through subscription of stock options. Stock options were exercised PUÄUHUJPHS`LHY^P[OZOHYLZ0U[OLYL were no share subscriptions made with the warrants of the stock option programs.
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 possibly has 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 provid-ing that the JVTWHUOHZH^LPNO[ÄUHUJPHSYLHZVUMVY[OLKL]PH[PVUPU respect of the share issue against payment.
Furthermore, the authorization includes the Board of Directors' right to decide upon who are entitled to the shares HUKVYZ[VJRVW[PVUZVYZWLJPHSYPNO[ZPUHJJVYKHUJL^P[O Chapter 10 Section 1 of the Finnish Companies Act as well as upon the related compensation, sub-scription and payment periods and upon the registering of the subscription price into the share capital or invested non-restricted equity fund within the limits of the Finnish Com-panies Act.
The authorization will be valid until the next Annual General Meeting but will however ex-pire at the latest on June 30, 2022.
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 5.1 percent of the company's total shares. The shares can also be ac-quired otherwise than in proportion to the holdings of the existing shareholders. The max-imum compensation to be paid for the acquired shares shall be the market price at the time of purchase, which is determined in the 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 Z[Y\J[\YL[VÄUHUJLHUKYLHSPaLJVYWVYH[LHJX\PZP[PVUZHUK 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.
Decision concerning the acquiring of own shares cannot be made so that the combined amount of the own shares, which are in the possession of, or held as pledges by, the com-pany or its subsidiaries exceeds 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 however ex-pire at the latest on June 30, 2022.
The share-based payments of SSH Communications Security are stock options. Stock option programs have been in LɈLJ[PU[OLYLWVY[PUNWLYPVKVYPU[OLJVTWHYPZVU`LHY
During 2021 no new stock option programs have been decided. The Board of Directors de-cided on January 20, 2020 on a new stock option program 2020 A. The maximum number of stock options is 980,000. The share subscription period will be from December 1, 2022 to March 31, 2024. The share subscription price for the shares is EUR 0.93.
Each option gives the right to subscribe to one new ZOHYLH[HWYPJLHUKH[H[PTLZWLJPÄLKPU[OL[LYTZVM[OL stock option plan. The option rights will be canceled in case the em-ployee leaves the company before the subscription time has begun. There are no other conditions to the beginning of the option rights.
The shares subscribed with the granted option rights include the rights to any dividend payable for the reporting period during which the shares were subscribed. Other share-holder rights commence as soon as the increase in
the share capital has been registered in the Trade Register. More information on stock option plans is given in note 19 in [OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z
+\YPUN[OLYLWVY[PUNWLYPVK[OLYLOH]LUV[ILLUHU`ZPNUPÄcant transactions with related parties.
There have been no material events after the balance sheet date.
The parent company's distributable funds are EUR VM^OPJO[OLWYVÄ[MVY[OLÄUHUJPHSLHYPZ EUR 1,917,403.65. The Board of Directors proposes to the Annual General Meeting on March 25, 2022 that no dividend or return of capital shall be distributed. It is proposed [OH[[OLWYVÄ[VM[OLÄUHUJPHSLHYZOHSSILLU[LYLK[V[OL retained earnings in the shareholders' equity.
| 2021 | 2020 | 2019 | ||
|---|---|---|---|---|
| Net sales | EUR | 15,929,489 | 11,251,214 | 14,378,011 |
| 6WLYH[PUNWYVÄ[SVZZ | ,<9 | -1,530,119 | -2,486,221 | -1,207,515 |
| % of net sales | % | -9.6 | -22.1 | -8.4 |
| EBITDA | EUR | 1,119,334 | -392,982 | 862,821 |
| % of net sales | % | 7.0 | -3.5 | 6.0 |
| 7YVÄ[SVZZILMVYL[H_LZ | ,<9 | -1,794,364 | -3,090,264 | -1,339,130 |
| % of net sales | % | -11.3 | -27.5 | -9.3 |
| Return on equity | % | -22.6 | -30.0 | -11.3 |
| Return on investments | % | -14.2 | -27.3 | -9.8 |
| Net interest-bearing debt | EUR | -4,788,959 | -7,220,926 | -11,112,723 |
| Gearing | % | -39.8 | -85.3 | -92.3 |
| Equity ratio | % | 44.6 | 69.7 | 78.0 |
| Gross investments in tangible and intangible assets | EUR | 1,976,713 | 2,115,884 | 2,005,264 |
| % of net sales | % | 12.4 | 18.8 | 13.9 |
| Research and development costs | EUR | -5,836,431 | -5,047,946 | -4,893,415 |
| % of net sales | % | 36.6 | 44.9 | 34.0 |
| Average number of personnel | 114 | 88 | 88 | |
| Number of personnel 31 Dec | 123 | 94 | 90 | |
| Salaries and fees | EUR | -10,958,262 | -8,125,559 | -8,315,829 |
| 2021 | 2020 | 2019 | ||
|---|---|---|---|---|
| Earnings per share1 | EUR | -0.10 | -0.11 | -0.06 |
| Earnings per share, diluted1 | EUR | -0.10 | -0.11 | -0.06 |
| Equity per share | EUR | 0.31 | 0.22 | 0.31 |
| Dividends | EUR | 0 | 0 | 0 |
| Dividends per share | EUR | 0.00 | 0.00 | 0.00 |
| Dividend pay-out ratio | % | 0 | 0 | 0 |
| ,ɈLJ[P]LKP]PKLUK`PLSK | 0 | 0 | 0 | |
| Return of capital | EUR | 0 | 0 | 0 |
| Return of capital per share | EUR | 0 | 0 | 0 |
| Adjusted average number of shares during the period | 1,000 | 38,927 | 38,802 | 38,802 |
| Adjusted number of shares at the end of the period | 1,000 | 39,279 | 38,802 | 38,802 |
| (KQ\Z[LKU\TILYVMZOHYLZJVUZPKLYPUNKPS[PVULɈLJ[ | 40,843 | 41,529 | 41,228 | |
| 7YPJLWLYLHYUPUNZYH[PV7, | neg. | neg. | neg. | |
| Market capitalization 31 Dec | mEUR | 118.2 | 65.8 | 40.2 |
1 Earnings per share is impacted by unpaid interest of hybrid capital securities.
| 2021 | 2020 | 2019 | ||
|---|---|---|---|---|
| Share performance at Nasdaq Helsinki | ||||
| Average price | EUR | 2.51 | 1.28 | 1.34 |
| Share price, year end | EUR | 3.01 | 1.70 | 1.04 |
| Lowest quotation | EUR | 1.60 | 0.65 | 0.97 |
| Highest quotation | EUR | 3.48 | 1.97 | 1.97 |
| Volume of shares traded | millions | 8.6 | 19.4 | 5.3 |
| Volume of shares traded, % of total number | % | 21.8 | 50.1 | 10.2 |
| Volume of shares traded | mEUR | 21.7 | 24.9 | 4.0 |
SSH Communications Security presents an alternative WLYMVYTHUJLTLHZ\YL^OPJOPZUV[KLÄULKI`0-9: standards. Alternative performance measure should not be considered as substitute for performance measures in HJJVYKHUJL^P[O[OL0-9:-YVT[OLÄYZ[X\HY[LYVM onwards, SSH Communications Security has introduced the following new alternative performance measure:
,)0;+(\$6WLYH[PUNWYVÄ[SVZZKLWYLJPH[PVUHTVY[PaH[PVU and impairment
The following table presents the reconciliation of EBITDA to [OLVWLYH[PUNWYVÄ[SVZZ
| kEUR | 2021 | 2020 |
|---|---|---|
| EBITDA | 1 119 | -393 |
| Depreciation, amortization, and impairment |
-2 649 | -2 093 |
| 6WLYH[PUNWYVÄ[SVZZ | -1 530 | -2 486 |
| Return on Equity, % (ROE) | = | 7YVÄ[SVZZMVY[OLÄUHUJPHSWLYPVK | x100 |
|---|---|---|---|
| ,X\P[`H]LYHNLK\YPUN[OLÄUHUJPHSWLYPVK | |||
| Return on Investment, % (ROI) | = | 7YVÄ[SVZZILMVYL[H_LZ0U[LYLZ[HUKV[OLYÄUHUJPHSJVZ[Z | x100 |
| Balance sheet total - Non-interest bearing debts H]LYHNLK\YPUNÄUHUJPHSWLYPVK |
|||
| Equity | |||
| Equity Ratio, % | = | Balance sheet total - Advance payments received | x100 |
| Earnings Per Share (EPS) | = | 7YVÄ[SVZZMVY[OLÄUHUJPHSWLYPVKò0U[LYLZ[VUO`IYPKJHWP[HSZLJ\YP[PLZ | |
| (]LYHNLU\TILYVMV[Z[HUKPUNZOHYLZK\YPUN[OLÄUHUJPHSWLYPVK | |||
| 7YVÄ[SVZZMVY[OLÄUHUJPHSWLYPVKò0U[LYLZ[VUO`IYPKJHWP[HSZLJ\YP[PLZ | |||
| Diluted EPS | = | (KQ\Z[LKH]LYHNLU\TILYVMZOHYLZJVUZPKLYPUNKPS[PVULɈLJ[ | |
| Dividend | |||
| Dividend Per Share | = | 5\TILYVMV[Z[HUKPUNZOHYLZK\YPUN[OLÄUHUJPHSWLYPVK | |
| Dividend Pay-out Ratio, % | = | Dividend per share | x100 |
| Earnings per share | |||
| Equity Per Share | = | Equity | |
| 5\TILYVMV[Z[HUKPUNZOHYLZVU[OLÄUHUJPHSZ[H[LTLU[KH[L adjusted for share issue |
|||
| Interest bearing debt - Liquid assets | |||
| Gearing, % | = | Equity | x100 |
| EUR | Note | 1 Jan – 31 Dec 2021 |
1 Jan – 31 Dec 2020 |
|---|---|---|---|
| NET SALES | 3 | 15,929,489 | 11,251,214 |
| Cost of goods sold | 31,325 | -283,797 | |
| GROSS MARGIN | 15,960,815 | 10,967,417 | |
| Other operating income | 4 | 1,111,266 | 987,464 |
| Sales and marketing costs | 5, 6 | -8,644,687 | -6,698,629 |
| R&D costs | 5, 6 | -5,836,431 | -5,047,946 |
| Administrative costs | 5, 6 | -4,121,081 | -2,694,526 |
| OPERATING PROFIT/LOSS | -1,530,119 | -2,486,221 | |
| Financial income | 7 | 172,611 | 631 |
| Financial costs | 8 | -436,856 | -604,675 |
| PROFIT/LOSS BEFORE TAXES | -1,794,364 | -3,090,264 | |
| Income tax expense | 9 | -524,030 | 12,162 |
| PROFIT/LOSS FOR THE FINANCIAL PERIOD | -2,318,394 | -3,078,102 | |
| 7YVÄ[SVZZH[[YPI[HISL[V! | |||
| Owners of the parent company | -2,057,540 | -2,834,022 | |
| Non-controlling interests | -260,854 | -244,081 | |
| TOTAL | -2,318,394 | -3,078,102 | |
| OTHER COMPREHENSIVE INCOME | |||
0[LTZ[OH[THILYLJSHZZPÄLKZ\IZLX\LU[S[VWYVÄ[VYSVZZ! |
|||
0[LTZ[OH[THILYLJSHZZPÄLKZ\IZLX\LU[S[VWYVÄ[VYSVZZ! |
|||||||
|---|---|---|---|---|---|---|---|
| ;YHUZSH[PVUKPɈLYLUJLZ | -142,858 | 266,038 | |||||
| TOTAL COMPREHENSIVE INCOME FOR THE YEAR | -2,461,252 | -2,812,064 | |||||
| ;V[HS*VTWYLOLUZP]LPUJVTLH[[YPI[HISL[V! | |||||||
| Owners of the parent company | -2,200,135 | -2,567,983 | |||||
| Non-controlling interests | -261,117 | -244,081 | |||||
| TOTAL | -2,461,252 | -2,812,064 | |||||
| EARNINGS PER SHARE | |||||||
| Basic earnings per share (EUR) | 10 | -0,10 | -0,11 | ||||
| Diluted earnings per share (EUR) | 10 | -0,10 | -0,11 | ||||
| EUR | Note | 31 Dec 2021 | 31 Dec 2020 |
|---|---|---|---|
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Property, plant and equipment | 11 | 159,654 | 142,859 |
| Right-of-use assets | 12,22 | 569,349 | 686,405 |
| Intangible assets | 13 | 21,872,947 | 5,447,999 |
| Investments | 11,000 | 11,000 | |
| Total non-current assets | 22,612,950 | 6,288,263 | |
| CURRENT ASSETS | |||
| Inventories | 36,196 | 33,406 | |
| Trade receivables | 14,16 | 4,253,848 | 2,961,250 |
| Other receivables | 15 | 463,513 | 492,525 |
| Prepaid expenses and accrued expenses | 352,379 | 341,785 | |
| Total urrent assets | 5,105,937 | 3,828,965 | |
| Cash and cash equivalents | 8,207,229 | 8,517,698 | |
| TOTAL CURRENT ASSETS | 13,313,166 | 12,346,663 | |
| TOTAL ASSETS | 35,926,116 | 18,634,926 |
| EUR | Note | 31 Dec 2021 | 31 Dec 2020 |
|---|---|---|---|
| EQUITY AND LIABILITIES | |||
| EQUITY ATTRIBUTABLE TO PARENT COMPANY SHAREHOLDERS Share capital |
17 | 1,178,367 | 1,164,067 |
| ;YHUZSH[PVUKPɈLYLUJLZ | -1,314,013 | -1,171,419 | |
| Unrestricted invested equity fund | 23,702,088 | 22,720,156 | |
| Hybrid capital securities | 12,000,000 | 12,000,000 | |
| Retained earnings | -29,561,871 | -26,603,569 | |
| Equity attributable to parent company shareholders | 6,004,570 | 8,109,235 | |
| Non-controlling interest | 6,021,169 | 355,791 | |
| TOTAL EQUITY | 12,025,739 | 8,465,026 | |
| NON-CURRENT LIABILITIES | |||
| Non-current interest-bearing liabilities | 18 | 2,327,000 | 582,000 |
| Lease liabilities | 18, 22 | 219,479 | 385,355 |
| Other non-current liabilities | 3,911,513 | ||
| Advances received and deferred revenue | 14 | 1,211,205 | 756,043 |
| Deferred tax liabilities | 1,578,841 | ||
| TOTAL NON-CURRENT LIABILITIES | 9,248,038 | 1,723,398 | |
| CURRENT LIABILITIES | |||
| Trade and other payables | 20 | 6,009,743 | 2,377,051 |
| Current interest-bearing liabilities | 500,000 | ||
| Lease liabilities | 18, 22 | 371,791 | 329,417 |
| Advances received and deferred revenue | 14 | 7,770,804 | 5,740,034 |
| TOTAL CURRENT LIABILITIES | 14,652,338 | 8,446,502 | |
| TOTAL LIABILITIES | 23,900,376 | 10,169,900 | |
| TOTAL EQUITY AND LIABILITIES | 35,926,116 | 18,634,926 |
| EUR | Note | 1 Jan – 31 Dec 2021 |
1 Jan – 31 Dec 2020 |
|---|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES | |||
| Receipts from customers | 3, 14 | 17,307,901 | 12,235,754 |
| Payments to suppliers and employees | 5, 20 | -14,135,079 | -12,400,181 |
| *HZOÅV^ZMYVTVWLYH[PUNHJ[P]P[PLZILMVYLÄUHUJPHSP[LTZHUK[H_LZ | 3,172,822 | -164,427 | |
| 0U[LYLZ[WHPKHUKWH`TLU[ZVUV[OLYÄUHUJPHSJVZ[Z | -86,074 | -73,456 | |
| 0U[LYLZ[YLJLP]LKHUKV[OLYÄUHUJPHSPUJVTL | 964 | 631 | |
| Income taxes paid | -300,208 | 9,373 | |
| 5L[JHZOÅV^ZMYVTVWLYH[PUNHJ[P]P[PLZ | 2,787,504 | -227,878 | |
| whereof change in working capital | 4,289,028 | 1,143,491 | |
| CASH FLOW FROM INVESTING ACTIVITIES | |||
| Investments in tangible and intangible assets | 11, 13 | -1,976,713 | -2,115,884 |
| Acquisition of a subsidiary, net of cash acquired | 25 | -4,637,770 | |
| Receipt of government grants | 4 | 1,757,784 | 612,255 |
| 5L[JHZOÅV^ZMYVTPU]LZ[PUNHJ[P]P[PLZ | -4,856,698 | -1,503,628 | |
| CASH FLOW FROM FINANCING ACTIVITIES | |||
| Change of non-current debt | 1,745,000 | ||
| Change in current debt | 500,000 | ||
| Interest paid on hybrid capital securities | -1,380,000 | -900,000 | |
| Proceeds from shares subscribed with option rights | 996,232 | ||
| 7YPUJPWHSWVY[PVUVMÄUHUJLSLHZLWH`TLU[Z | 21 | -386,328 | -374,466 |
| 5L[JHZOÅV^ZMYVTÄUHUJPUNHJ[P]P[PLZ | 1,474,904 | -1,274,466 | |
| Change in cash and cash equivalents | -594,290 | -3,005,973 | |
| Cash and cash equivalents in beginning of period | 8,517,698 | 11,968,885 | |
| ,_JOHUNLYH[LLɈLJ[ | 283,821 | -445,214 | |
| Change in cash and cash equivalents | -594,290 | -3,005,973 | |
| Cash and cash equivalents at end of period | 8,207,229 | 8,517,698 | |
| ([[YPI[HISL[V[OLV^ULYZVM[OL*VTWHU` | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| EUR | Note | Share capital |
Hybrid capital securities |
Translation KPɈLYLUJLZ |
Unrestricted invested equity fund |
Retained earnings |
Total | Non controlling interests |
Total Equity |
| Equity 1 Jan 2020 | 17 | 1,164,067 | 12,000,000 | -1,437,458 | 22,720,156 | -23,000,578 | 11,446,187 | 599,872 | 12,046,059 |
| *VTWYLOLUZP]LWYVÄ[SVZZ | |||||||||
| 7YVÄ[SVZZMVY[OLWLYPVK | -2,834,022 | -2,834,022 | -244,081 | -3,078,102 | |||||
| Other comprehensive items | |||||||||
;YHUZSH[PVUKPɈLYLUJLZ |
266,038 | 266,038 | 266,038 | ||||||
| *VTWYLOLUZP]LWYVÄ[SVZZ MVYÄUHUJPHSWLYPVK[V[HS |
0 | 0 | 266,038 | 0 | -2,834,022 | -2,567,983 | -244,081 | -2,812,064 | |
| Hybrid capital securities | -900,000 | -900,000 | -900,000 | ||||||
| Share-based payment plans | 131,031 | 131,031 | 131,031 | ||||||
| ;YHUZHJ[PVUZ^P[OZOHYLOVSKLYZ | 0 | 0 | 0 | 0 | -768,969 | -768,969 | 0 | -768,969 | |
| Equity 31 Dec 2020 | 1,164,067 | 12,000,000 | -1,171,419 | 22,720,156 | -26,603,569 | 8,109,235 | 355,791 | 8,465,026 |
| ([[YPI[HISL[V[OLV^ULYZVM[OL*VTWHU` | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| EUR | Note | Share capital |
Hybrid capital securities |
Translation KPɈLYLUJLZ |
Unrestricted invested equity fund |
Retained earnings |
Total | Non controlling interests |
Total Equity |
| Equity 1 Jan 2021 | 17 | 1,164,067 | 12,000,000 | -1,171,419 | 22,720,156 | -26,603,569 | 8,109,235 | 355,791 | 8,465,026 |
| *VTWYLOLUZP]LWYVÄ[SVZZ | |||||||||
| 7YVÄ[SVZZMVY[OL`LHY | -2,057,540 | -2,057,540 | -260,854 | -2,318,394 | |||||
| Other comprehensive items | |||||||||
;YHUZSH[PVUKPɈLYLUJLZ |
-142,594 | -142,594 | -264 | -142,858 | |||||
| *VTWYLOLUZP]LWYVÄ[SVZZ MVYÄUHUJPHSWLYPVK[V[HS |
0 | 0 | -142,594 | 0 | -2,057,540 | -2,200,135 | -261,117 | -2,461,252 | |
| Hybrid capital securities | -1,380,000 | -1,380,000 | -1,380,000 | ||||||
| Share-based payment plans | 479,238 | 479,238 | 479,238 | ||||||
| Shares subscribed on op-tion rights | 14,300 | 981,932 | 996,232 | 996,232 | |||||
| Acquisition of a subsidiary | 5,926,495 | 5,926,495 | |||||||
| ;YHUZHJ[PVUZ^P[OZOHYLOVSKLYZ | 14,300 | 0 | 0 | 981,932 | -900,762 | 95,470 | 5,926,495 | 6,021,965 | |
| Equity 31 Dec 2021 | 1,178,367 | 12,000,000 | -1,314,013 | 23,702,088 | -29,561,871 | 6,004,570 | 6,021,169 | 12,025,739 |
SSH Communications Security Corporation helps organizations access, secure and control their digital core – their critical data, applications and services. In the rapidly growing global data economy, secure access that enables digital transformation at business velocity is the new competitive advantage.
Our thousands of customers include Fortune 500 com-WHUPLZ[OL^VYSK»ZSHYNLZ[ÄUHUJPHSPUZ[P[[PVUZHUKTHQVY organizations in all verticals. Our solutions guard against the rapidly changing threat landscape that includes both internal and external actors.
We generate shareholder value from a combination of our world-leading expertise, proven enterprise-class solu- [PVUZWYVMLZZPVUHSZLY]PJLZZ\WWVY[VɈLYPUNHUKMYVTV\Y strong IP portfolio and well-established licensing operations.
The SSH Communications Security Group consists of SSH Communications Security Corporation and its subsidiaries. SSH Communications Security Corporation (corporate id 1035804-9) is domiciled in Helsinki, Finland and is a publicly traded company, whose share is quoted on NASDAQ Helsinki Oy (SSH1V). SSH Communications :LJ\YP[`*VYWVYH[PVUOHZP[ZYLNPZ[LYLKVɉJLH[HKKYLZZ Karvaamokuja 2B, 00380 Helsinki, Finland.
The SSH Communications Security Board of Directors HWWYV]LK[OPZÄUHUJPHSZ[H[LTLU[MVYW\ISPJH[PVUH[P[ZTLL[ ing on 23 February 2022. Under the Finnish Limited Liability Companies Act, the shareholders can accept or reject the ÄUHUJPHSZ[H[LTLU[H[[OL(.4OLSKHM[LYP[ZW\ISPJH[PVU( JVW`VM[OLÄUHUJPHSZ[H[LTLU[ZPZW\ISPZOLKHZHWHY[VM[OL company's annual report.
The annual report is available on the company website H[^^^ZZOJVTVYH[[OLOLHKVɉJLVM::/*VTT\UPJHtions Security Corporation. All stock exchange bulletins are available on the company website www.ssh.com.
;OLP?)93[HNNPUNVM,:,-JVUZVSPKH[LKÄUHUJPHSZ[H[Lments have not been audited.
SSH Communications Security Corporation has one reportable segment, the software business.
;OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[ZOH]LILLUWYLWHYLK in compliance with the International Financial Reporting Standards (IFRS). The aforementioned standards are the standards and interpretations thereof approved for use in [OL,<W\YZ\HU[[V9LN\SH[PVU,*5VPTWSLmented in the Finnish Accounting Act and legislation based [OLYLVU;OLUV[LZ[V[OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z are also compliant with Finnish accounting and company legislation.
;OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[ZHYLIHZLKVU original acquisition costs unless otherwise noted in the HJJV\U[PUNWYPUJPWSLZ;OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z are presented in full euros unless otherwise stated.
The Group has adopted the new standards and PU[LYWYL[H[PVUZ[OH[[VVRLɈLJ[K\YPUN[OLHJJV\U[PUNWLYPVK and are relevant to its operations. The IFRS standards and the amendments that entered into force in 2021 had no PTWHJ[VU[OL.YV\W»ZYLZ\S[[OLÄUHUJPHSWVZP[PVUVY[OL WYLZLU[H[PVUVM[OLÄUHUJPHSZ[H[LTLU[Z
The Group will adopt new and amended standards and PU[LYWYL[H[PVUZHZVM[OLLɈLJ[P]LKH[LVYPM[OLKH[LPZV[OLY [OHU[OLÄYZ[KHVM[OLÄUHUJPHSLHYMYVT[OLILNPUUPUNVM [OLZ\IZLX\LU[ÄUHUJPHSLHY;OLJOHUNLZHYLUV[L\_ pected to have a material impact on SSH Communications :LJ\YP[»ZJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z
The consolidated accounts include the parent company SSH Communications Security Corporation and all its subsidiaries. Subsidiaries are companies in which the Group has a controlling interest. A controlling interest is created when the Group has power over the investee, exposure, or rights, to variable returns from its involvement with the investee and the ability to use its power over the investee to HɈLJ[[OLHTV\U[VM[OL.YV\W»ZYL[\YUZ0UWYHJ[PJLJVUtrolling interest is established when the Group owns more than half of the votes in a company.
Group-internal share ownership is eliminated using the purchase method. Subsidiaries are consolidated from the date on which control is transferred to the Group and are no longer consolidated from the date on which that control ceases. All Group-internal transactions, receivables and KLI[Z\UYLHSPaLKWYVÄ[HUKWYVÄ[KPZ[YPI[PVUOH]LILLU eliminated.
The share of the non-controlling interests of the subsid-PHYPLZ»WYVÄ[ZHUKLX\P[`PZWYLZLU[LKHZHZLWHYH[LP[LTPU the consolidated income statement, comprehensive income statement, statement of changes in equity, and in the balance sheet.
Items of each subsidiary included in the consolidated ÄUHUJPHSZ[H[LTLU[ZHYLTLHZ\YLK\ZPUN[OLJ\YYLUJVM the operating environment of that subsidiary ('functional J\YYLUJ»;OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[ZHYL presented in euros, which is the functional and reporting currency of the parent company.
Foreign currency denominated transactions are recognized at the exchange rate of the functional currency on the transaction date. In practice, the exchange rate used is approximately the rate of the transaction date. Outstanding receivables and liabilities in foreign currencies are measured using the exchange rates on the balance sheet date. Exchange YH[LKPɈLYLUJLZHYLYLJVYKLKPU[OLPUJVTLZ[H[LTLU[ ,_JOHUNLYH[LNHPUZHUKSVZZLZVUÄUHUJPUNHYLPUJS\KLKPU ÄUHUJPUNPUJVTLHUKJVZ[Z
;OLJVTWYLOLUZP]LPUJVTLZ[H[LTLU[ZHUKJHZOÅV^ statements of subsidiaries whose functional currency is other than EUR are translated into euros using the exchange rate of the transaction dates. In practice, the translations are done once a month using the monthly average exchange rate. Balance sheet items are translated into euros with the exchange rate of the balance sheet date. The translation of [OLJVTWYLOLUZP]LWYVÄ[SVZZMVY[OLÄUHUJPHSWLYPVK\Z-PUNKPɈLYLU[L_JOHUNLYH[LZPU[OLJVTWYLOLUZP]LPUJVTL statement on the one hand and in the balance sheet on [OLV[OLYJH\ZLZH[YHUZSH[PVUKPɈLYLUJLYLJVNUPaLK\UKLY .YV\WLX\P[`\UKLYV[OLYJVTWYLOLUZP]LWYVÄ[SVZZP[LTZ
;YHUZSH[PVUKPɈLYLUJLZNLULYH[LK[OYV\NOLSPTPUH[PVU of the acquisition costs of foreign subsidiaries and translation of equity items accrued after acquisition are recog-UPaLK\UKLYV[OLYJVTWYLOLUZP]LWYVÄ[SVZZP[LTZ>OLUH Z\IZPKPHY`PZZVSKHJJ\T\SH[LK[YHUZSH[PVUKPɈLYLUJLZHYL recognized in the income statement as part of the gain or loss on the sale.
SSH Communications Security net sales derive mainly from software license sales and subscriptions, related support and maintenance fees, and consulting fees. Net sales comprise the invoiced value for the sale of goods and services adjusted with any discounts given, sales taxes, and ex-JOHUNLYH[LKPɈLYLUJLZ
The revenue from product sales is recognized at the [PTL^OLUZPNUPÄJHU[YPZRZHUKYL^HYKZVM[OLWYVK\J[VY the right of use of the product have been transferred to the buyer and there is a binding contract between the parties, the delivery has taken place in accordance with the contract, the amount of revenue can be measured reliably, and P[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[ZHZZVJPH[LK^P[O[OL transaction will accrue to the Group. Control is transferred to the buyer at the point of time.
Maintenance sales, or revenue from support and maintenance contracts, are recognized evenly on an accrual basis throughout the contract period. Revenues from services are recognized when the service has been delivered and it PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[ZHZZVJPH[LK^P[O[OL transaction will accrue to the Group. Revenue from subscription contracts is recognized evenly on an accrual basis throughout the contract period.
The revenue of royalties from licenses is recognized according to the actual content of the contract at the point of time.
The Group customarily receives short-term advance payments from customers, but also from time to time substantial long-term advance payments for subscription or Z\WWVY[HUKTHPU[LUHUJLMLLZ0U[OLZLJHZLZ[OLÄUHUJing component is accounted for and interest expenses are recorded for the duration of the advance payment.
Grants received from the government for purchase of tangible assets are entered as a deduction of the book value of the asset when there is reasonable assurance that the company will receive the grant and will comply with the conditions attaching to the grant. Grants are recognized as income over the life of a depreciable asset by way of a reduced depreciation. Government grants that are intended to compensate for costs are recognized as income over the same period as the related costs are recognized. These government grants are presented under other operating income.
The property, plant, and equipment of Group companies are measured in the balance sheet at cost less accumulated straight-line depreciation and eventual impairment losses. When a part of a current assets item is treated as a separate asset, expenses related to its replacement are capitalized HUKHU`YLTHPUPUNIVVR]HS\LPZ^YP[[LUVɈ,_WLUZLZ incurring later are included in the class of property, plant, and equipment only if it is probable that the property will WYV]PKLM[\YLLJVUVTPJILULÄ[Z[V[OL.YV\WHUK[OH[[OL acquisition cost can be reliably determined. Other repair and THPU[LUHUJLL_WLUZLZHYLYLJVNUPaLKPUWYVÄ[SVZZHZHUK when incurred.
Depreciation is calculated on a straight-line basis to reduce the purchase value of each asset item to its residual value over its estimated useful life.
HUKLX\PWTLU[!LHYZMYVTTVU[OVM acquisition.The residual value and useful life of assets are reviewed MVYLHJOÄUHUJPHSZ[H[LTLU[HUKPMULJLZZHYHKQ\Z[LK[V indicate changes expected in the assets' economic ben-LÄ[Z;OLKLWYLJPH[PVUVUWYVWLY[WSHU[HUKLX\PWTLU[ PZJLHZLK^OLU[OLHZZL[PZJSHZZPÄLKHZOLSKMVYZHSLPU accordance with standard IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.
Capital gains and losses are determined by comparing proceeds received with the book value of sold assets. Impairment losses incurred through transfer are recognized under other operating costs.
Research costs are recognized as costs in the income statement. Development costs (related to the design and testing of new or improved products) from incomplete projects are recognized as intangible assets if capitalization criteria are M\SÄSSLK[V[OLL_[LU[VM[OLPYWYVIHISLLJVUVTPJILULÄ[Z[V [OLJVTWHU`;OLTVZ[ZPNUPÄJHU[KL]LSVWTLU[JVZ[Z[VIL capitalized constitute R&D personnel costs and sub-contracting costs. Other development costs are recognized
directly as costs. Development costs once recognized as JVZ[ZHYLUV[JHWP[HSPaLKPUZ\IZLX\LU[ÄUHUJPHSWLYPVKZ
Capitalized assets are tested annually for impairment. After initial recognition, capitalized development costs are measured at cost less accumulated depreciation and impairment losses. Capitalized development costs are depreciated on a straight- line basis over their economic lifetime, estimated at 5 years.
Software includes acquired software licenses. These assets are entered in the balance sheet at cost and depreciated on a straight-line basis over their economic lifetime. The residual value and useful life of assets are reviewed for each ÄUHUJPHSZ[H[LTLU[HUKPMULJLZZHY`HKQ\Z[LK[VPUKPJH[L JOHUNLZL_WLJ[LKPU[OLHZZL[Z»LJVUVTPJILULÄ[Z;OL economic lifetime does not generally exceed 5 years. The depreciation period for software acquired for internal use is 3–5 years.
Immaterial rights include obtained technology patents, trademarks, customer registers, and technology rights. These are entered in the balance sheet at cost and depreciated on a straight-line basis over their economic lifetime. The residual value and useful life of assets are YL]PL^LKMVYLHJOÄUHUJPHSZ[H[LTLU[HUKPMULJLZZHYadjusted to indicate changes expected in the assets' LJVUVTPJILULÄ[Z;OLLJVUVTPJSPML[PTLPZNLULYHSS[V 10 years.
Acquisitions are accounted for using the acquisition method. Goodwill represents the excess of acquisition cost over [OLMHPY]HS\LZVMPKLU[PÄLKHJX\PYLKHZZL[ZHUKSPHIPSP[PLZVM acquired companies. Goodwill is stated at historical cost less any accumulated impairment losses. Goodwill represents the value of the acquired market share, business knowledge and the synergies obtained in connection with
the acquisition. The carrying amount of goodwill is not amortized, but is tested for impairment annually or more frequently f any indication of impairment exists.
The Group assesses the carrying amount of goodwill annually or more frequently if any indication of impairment exists. Goodwill is allocated to the cash generating units *.<ZVM[OL.YV\W^OPJOHYLPKLU[PÄLKHJJVYKPUN[V[OL country of operation and business unit at the level at which goodwill is monitored for internal management purposes. The recoverable amount of a CGU is determined by valuein-use calculations. In assessing the recoverable amount, LZ[PTH[LKM[\YLJHZOÅV^ZHYLKPZJV\U[LK[V[OLPYWYLZLU[ ]HS\L*HZOÅV^LZ[PTH[LZHYLIHZLKVUVWLYH[P]LTHUHgerial estimates. The discount rate is the weighted average cost of capital (WACC) for the main currency area in the lo-JH[PVUVM[OL*.<JV\U[YVYI\ZPULZZHYLH^OPJOYLÅLJ[Z the market assessment of the time value of money and the YPZRZZWLJPÄJPU::/\*VTT\UPJH[PVUZ:LJ\YP[»ZI\ZPULZZ Any impairment loss of goodwill is recognized immediately as an expense and is not subsequently reversed.
The Group will review on each balance sheet date whether there is any indication of an impaired asset. Whenever indicators of impairment exist, the book value of such an asset is compared with its recoverable amount. The recoverable amount is the fair value of the asset less the costs of its sale, or its value in use, whichever is higher. The value in use PZ[OLWYLZLU[]HS\LVM[OLM[\YLJHZOÅV^ZL_WLJ[LK[VIL derived from an asset or cash-generating unit. The discount YH[L\ZLK[VJHSJ\SH[L[OLHIV]LPZWYL[H_YH[L[OH[YLÅLJ[Z the current market assessments of the time value of money HUK[OLYPZRZZWLJPÄJ[V[OLHZZL[
Whenever the book value of an asset exceeds its recoverable amount, an impairment loss will be recognized for that asset. The impairment loss is recognized immediately in the income statement. After the recognition of an impairment loss, the economic lifetime of an asset subject to depreciation is re-evaluated. An impairment loss recognized in prior period for an asset other than goodwill will be reversed if there is a change in the estimates that have been used in assessing the recoverable amount of that asset.
Inventories are valued at cost or at a net realizable value, ^OPJOL]LYPZSV^LY0U]LU[VYPLZJVTWYPZLÄUPZOLKNVVKZMVY sale or for use in producing a service.
;OL.YV\WOHZJSHZZPÄLKP[ZÄUHUJPHSHZZL[ZPU[V[OLMVSSV^- PUNJH[LNVYPLZ!ÄUHUJPHSHZZL[ZH[MHPY]HS\L[OYV\NOWYVÄ[VM SVZZÄUHUJPHSHZZL[ZH[MHPY]HS\L[OYV\NOJVTWYLOLUZP]L PUJVTLZ[H[LTLU[HUKÄUHUJPHSHZZL[ZH[HTVY[PaLK]HS\L
;OLHZZL[ZHYLJSHZZPÄLKH[PUP[PHSYLJVNUP[PVU"[OLJSHZ-ZPÄJH[PVUPZIHZLKVU[OLI\ZPULZZTVKLS\ZLKPUTHUHNPUN [OLÄUHUJPHSHZZL[ZHUKJVU[YHJ[\HS[LYTZVM[OLJHZOÅV^Z The assets are initially recognized at fair value. Transaction costs are included in the original book value of an asset if [OLHZZL[PZUV[[VILYLJVNUPaLKH[MHPY]HS\L[OYV\NOWYVÄ[ VYSVZZ-PUHUJPHSHZZL[ZHYL^YP[[LUVɈMYVT[OLIHSHUJL ZOLL[^OLU[OLJVU[YHJ[\HSYPNO[[VJHZOÅV^ZMYVTHU HZZL[PUJS\KLKPUÄUHUJPHSHZZL[ZLUKZVY^OLU[OLZPNUPÄcant risks and rewards related to the asset are transferred outside the Group. All asset purchases and sales are recognized on the date of the transaction.
-PUHUJPHSHZZL[Z[OYV\NOWYVÄ[VYSVZZPUJS\KLKLYP]H[P]LZ \USLZZ[OL`HYLKLZPNUH[LKHZLɈLJ[P]LOLKNPUNPUZ[Y\TLU[Z or warrants such as currency derivatives, and fund invest-TLU[Z*OHUNLZPUMHPY]HS\LZVMKLYP]H[P]LÄUHUJPHSPUZ[Y\ ments and realized and unrealized gains and losses are recognized in the income statement during the period when they incur. The Group did not have any derivatives during 2021 or 2020.
Loans and receivables are valued at cost at the time of acquisition and they are measured at amortized acquisition JVZ[\ZPUN[OLLɈLJ[P]LPU[LYLZ[YH[LTL[OVK
Cash and cash equivalents include cash on hand, short-term deposits at banks, and other short-term liquid investments. (ZZL[ZJSHZZPÄLKHZJHZOHUKJHZOLX\P]HSLU[ZOH]LHTH[\YPty of three months or less at the time of acquisition.
;OL.YV\WHWWSPLZ[OL0-9: ZPTWSPÄLKHWWYVHJO[V measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. Credit losses are recognized in the income statement in other operating expenses.
The Group assesses at each balance sheet date wheth-LYHUPUKP]PK\HSÄUHUJPHSHZZL[VYNYV\WVMÄUHUJPHSHZZL[Z is impaired. The Group recognizes an impairment loss on trade receivables when it is expected that the receivable ^PSSUV[ILYLJV]LYLKPUM\SS:PNUPÄJHU[ÄUHUJPHSKPɉJ\S[PLZ likelihood of bankruptcy, neglect of payments, or delay of payment by more than 90 days on part of a debtor may be considered to constitute such evidence for an impairment loss on trade receivables.
;OL.YV\W»ZÄUHUJPHSSPHIPSP[PLZHYLJSHZZPÄLKPU[VÄUHUJ-PUNSPHIPSP[PLZYLJVNUPaLKH[MHPY]HS\L[OYV\NOWYVÄ[SVZZVY V[OLYÄUHUJPHSSPHIPSP[PLZÄUHUJPUNSPHIPSP[PLZYLJVNUPaLKH[ HTVY[PaLKHJX\PZP[PVUJVZ[(ÄUHUJPHSSPHIPSP[PZJSHZZPÄLK as current if the Group does not have the absolute right to postpone repayment to at least 12 months from the end of [OLWLYPVK\UKLYYL]PL^(ÄUHUJPHSSPHIPSP[VYWHY[[OLYLVM ^PSSUV[IL^YP[[LUVɈ[OLIHSHUJLZOLL[\U[PSP[OHZJLHZLK [VL_PZ[PL^OLU[OLVISPNH[PVUZWLJPÄLKPU[OLHNYLLTLU[ has been discharged or reversed and its period of validity has expired.
0U[OL::/*VTT\UPJH[PVUZ:LJ\YP[`.YV\WÄUHUJPHS SPHIPSP[PLZYLJVNUPaLKH[MHPY]HS\L[OYV\NOWYVÄ[SVZZPUJS\KL [OLKLYP]H[P]LPUZ[Y\TLU[Z^OPJOKVUV[M\SÄSS[OLJYP[LYPHMVY hedging accounting, and which are not warrants (currency KLYP]H[P]LZ<UYLHSPaLKHUKYLHSPaLKNHPUZSVZZLZK\L[V
changes in the fair value of these derivatives are recognized PUWYVÄ[SVZZPU[OLÄUHUJPHSWLYPVKK\YPUN^OPJO[OL`HYL generated. The Group did not have any derivative contracts during 2021 or 2020.
6[OLYÄUHUJPHSSPHIPSP[PLZÄUHUJPUNSPHIPSP[PLZYLJVNUPaLK H[HTVY[PaLKJVZ[PUJS\KLTVZ[ZPNUPÄJHU[S[YHKLWH ables. They are initially recognized at fair value. After the VYPNPUHSYLJVNUP[PVUV[OLYÄUHUJPHSSPHIPSP[PLZHYLTLHZ\YLK H[HTVY[PaLKHJX\PZP[PVUJVZ[\ZPUN[OLLɈLJ[P]LPU[LYLZ[YH[L method.
;OL.YV\WSLHZLZTHPUSVɉJLZ9LU[HSJVU[YHJ[ZHYL [WPJHSSTHKLMVYÄ\_LKWLYPVKZMYVT[^V[V[OYLLLHYZ but may have extension options. Extension options have not been included in the lease liability, because the Group JV\SKYLWSHJL[OLHZZL[^P[OV[ZPNUPÄJHU[JVZ[VYI\ZPULZZ disruption. The lease term is reassessed if the option is exercised.
Leases are recognized in the balance sheet as a right-VM\ZLHZZL[HUKHJVYYLZWVUKPUNÄUHUJPHSSPHIPSP[H[[OL date at which the lease asset is available for the use by the Group. Each lease payment is allocated between the liabil-P[HUKÄUHUJLJVZ[;OLÄUHUJLJVZ[PZYLJVNUPaLKPU[OL income statement over the lease period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. The right-of-use assets are also subject to impairment.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease commencement date because the interest rate implicit in the lease is not readily determinable. After the commencement KH[L[OLHTV\U[VMSLHZLSPHIPSP[PLZPZPUJYLHZLK[VYLÅLJ[ the accretion of interest and reduced for the lease payments made. The carrying amount of lease liabilities is remeasured PM[OLYLPZHTVKPÄJH[PVUHJOHUNLPU[OLSLHZL[LYTH change in the lease payments or a change in the assessment of an option to purchase the underlying asset.
Lease liabilities are included in interest-bearing loans
and borrowings.
The Group applies the short-term lease recognition exemption to the leases of 12 months or less and the lease of low-value assets recognition exemption. Lease payments on short-term leases and leases of low-value assets are recognized as expense on a straight-line basis over the lease term.
,HYUPUNZWLYZOHYLPZJHSJ\SH[LKIKP]PKPUN[OLUL[WYVÄ[ SVZZMVY[OLÄUHUJPHSLHYH[[YPI[HISL[V[OLV^ULYZI[OL weighted average number of ordinary shares outstanding K\YPUN[OLÄUHUJPHSLHY,HYUPUNZWLYZOHYLPZPTWHJ[LKI` unpaid interest of hybrid capital securities.
(KPS[P]LLɈLJ[JH\ZLKI`Z[VJRVW[PVUZL_PZ[Z^OLU[OL subscription price of a share is lower than the fair value of the share. In the calculation of diluted earnings per share, stock options are only considered dilutive when their conversion to ordinary shares would decrease earnings per share or increase the loss per share from continuing operations. In other words, when the Group declares a loss, no KPS[P]LLɈLJ[^PSSILJHSJ\SH[LK+PS[LKLHYUPUNZWLYZOHYL is impacted by unpaid interest of hybrid capital securities.
Share capital consists of ordinary shares of the parent JVTWHUJSHZZPÄLKHZLX\P[+P]PKLUKZWHPKVUVYKPUHY` shares are deducted from equity in the period during which the decision to distribute dividends is made in the Annual General Meeting.
Costs directly related to an issue of new shares, other than costs attributable to a business combination, are deducted, net of tax, from the proceeds recognized under equity.
If SSH Communications Security Corporation or its subsidiaries purchase parent company SSH Communications Security Corporation's shares, the compensation paid, including any related incremental external costs, net of tax, is deducted from total equity as own shares until the shares are canceled or transferred. If own shares are subsequently sold, any compensation received will be recognized under equity. The Group companies held no shares in the parent company on December 31, 2021 or December 31, 2020.
Hybrid capital securities is an instrument that is subordinated to the Company's other debt obligations and is treated as equity in the Group balance sheet. Unpaid interest is J\T\SH[LKI[WYLZLU[LKPU[OLÄUHUJPHSZ[H[LTLU[ZVUS` after Board of Directors' interest payment decision.
Gross margin is equal to net sales less the acquisition costs of directly related materials and services.
0(:7YLZLU[H[PVUVM-PUHUJPHS:[H[LTLU[ZKVLZUV[KLÄUL VWLYH[PUNWYVÄ[SVZZ;OL.YV\W\ZLZ[OLMVSSV^PUNKLÄUP- [PVU!VWLYH[PUNWYVÄ[SVZZPZLX\HS[VLHYUPUNZILMVYLPU[LYLZ[ and taxes.
Tax expenses in the income statement comprise tax based on taxable income for the period and deferred tax. Income tax is recognized in the income statement except for taxes YLSH[LK[VP[LTZYLJVNUPaLK\UKLYJVTWYLOLUZP]LWYVÄ[SVZZ or directly under equity, in which case the tax impact will be incorporated in the aforementioned items. Tax based on taxable income for the period is calculated using the corpo-YH[LPUJVTL[H_YH[LHUK[H_SH^ZLɈLJ[P]LPULHJOJV\U[Y` adjusted for any tax from previous periods.
+LMLYYLK[H_LZHYLJHSJ\SH[LKVU[LTWVYHYKPɈLYLUJes between the book value and taxable value. The largest [LTWVYHYKPɈLYLUJLZHYPZLMYVT\U\ZLK[H_SVZZLZ^OPJO are deductible later.
Deferred taxes are calculated using the statutory tax IHZLZ^P[OJVUÄYTLKJVU[LU[HUUV\UJLKI[OLJSVZPUN date or with generally accepted tax bases. Deferred tax assets are recognized to the extent that it is probable that [H\_HISLPUJVTLHNHPUZ[^OPJO[OL[LTWVYHYKPɈLYLUJLJHU be applied will materialize in the future.
The Group's pension schemes comply with the relevant regulations and practices in each relevant country. Pension security for the Group personnel is handled through external WLUZPVUPUZ\YHUJLJVTWHUPLZ;OL.YV\WHWWSPLZKLÄULK contribution pension plans, in which the Group pays Ä_LKJVU[YPI[PVUZ[VHUV[ZPKL\UP[;OL.YV\WOHZUV obligation to make additional payments in case the recipient of the contributions cannot discharge its pension payment VISPNH[PVUZ*VU[YPI[PVUZ\UKLY[OLKLÄULKJVU[YPI[PVU WSHUHYLYLJVNUPaLKPU[OLPUJVTLZ[H[LTLU[MVY[OLÄUHUJPHS period during which the contributions were made.
Option rights have been issued to the Group management HUKWLYZVUULS6W[PVUYPNO[ZHYLPZZ\LK^P[OHÄ_LKZ\I-
scription price determined in the terms and conditions of the option plan.
Option rights are measured at fair value on their date of issue and recognized as a cost in the income statement on a straight-line basis over the vesting period. The expense deter-mined at the time of issuing the stock options is based on the Group's estimate of the number of stock options to which it is assumed that rights will vest by the end of the vesting period. The fair value is determined using the Black-Scholes pricing model. The non-market criteria are not included in the fair value of the option but considered in the number of stock options that are assumed to vest at [OLLUKVM[OL]LZ[PUNWLYPVK6U[OLKH[LVMLHJOÄUHUJPHS Z[H[LTLU[[OL.YV\W\WKH[LZP[ZLZ[PTH[LVM[OLÄUHS amount of the stock options that will vest, and changes in this estimate are recognized in the income statement. When the option rights are exercised, the proceeds received, net of any transaction costs, are recognized under share capital and unrestricted invested equity fund.
Provisions are recognized when the Group has a present legal or constructive obligation as a result of past events, when it is probable that expenditure will be required to settle the obligation, and when a reliable estimate of the amount can be made. If the Group expects an obligation to be partly reimbursed by a third party, the reimbursement is recognized as a separate asset but only when the reimbursement is certain in practical terms. The Group recognizes a provision on loss-making agreements when [OLL_WLJ[LKILULÄ[ZVMHUHNYLLTLU[HYLSLZZ[OHU[OL unavoidable costs of meeting the obligations under the agreement.
Provisions are measured at the current value of the costs required to discharge the obligation. The discount rate PZKL[LYTPULK[VYLÅLJ[J\YYLU[THYRL[HZZLZZTLU[ZVM[OL [PTL]HS\LVMTVUL`HUK[OLYPZRZZWLJPÄJ[V[OLVISPNH[PVU
7YLWHYH[PVUVM[OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z in accordance with IFRS requires management to make LZ[PTH[LZHUKHZZ\TW[PVUZHɈLJ[PUN[OLYLWVY[LKHTV\U[Z of assets, liabilities, income and expenses, as well as the disclosure of contingent assets and liabilities. The estimates and assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances, which form the basis of making the judgments about carrying values. These estimates and assump- [PVUZHYLYL]PL^LKVUHUVUNVPUNIHZPZHUKWVZZPISLLɈLJ[Z of changes in estimates and assumptions are recognized during the period they are changed.
;OLLZ[PTH[LZHUKHZZ\TW[PVUZ[OH[OH]LHZPNUPÄJHU[ risk of causing adjustment to the carrying value of assets ^P[OPUUL_[ÄUHUJPHS`LHYYLSH[L[VYLZ[Y\J[\YPUNWSHUZPTpairment testing, claims, onerous contracts, pending patent litigations, and the probability of deferred tax assets being YLJV]LYLKHNHPUZ[M[\YL[H_HISLWYVÄ[Z
| EUR | 2021 | 2020 |
|---|---|---|
| BY OPERATION | ||
| Subscription sales | 4,698,933 | 768,755 |
| License sales | 3,089,244 | 2,245,939 |
| Maintenance sales | 7,562,294 | 7,800,367 |
| Professional services and other |
579,018 | 436,153 |
| Total | 15,929,489 | 11,251,214 |
| EUR | 2021 | 2020 |
|---|---|---|
| BY GEOGRAPHICAL SEGMENT | ||
| AMERICAS | 6,590,099 | 5,943,849 |
| APAC | 1,659,492 | 2,124,979 |
| EMEA | 7,679,898 | 3,182,386 |
| Total | 15,929,489 | 11,251,214 |
In 2021 or 2020, no customer's revenue accounted for more than ten percent of the Group's net sales.
Other operating income includes EUR 1.1 million received government grants (2020: EUR 1.0 million).
| EUR | 2021 | 2020 |
|---|---|---|
| ,TWSV`LLILULÄ[ L_WLUZLZ |
||
| Wages and salaries | -10,542,722 | -8,387,096 |
| 7LUZPVUZKLÄULK contribution plan |
-1,156,592 | -796,193 |
| Other social security costs | -525,221 | -449,328 |
| Stock options issued | -479,238 | -131,031 |
| Total | -12,703,773 | -9,763,649 |
Information about remuneration of the key management personnel is presented in note 24. Related party transactions and information on the options granted is presented in the note 19. Share-based payments.
| Number of personnel | 2021 | 2020 |
|---|---|---|
| (]LYHNLK\YPUN[OLÄUHUJPHS period |
114 | 88 |
| ([[OLLUKVM[OLÄUHUJPHS period |
123 | 94 |
| Personnel distribution by function on 31 Dec |
2021 | 2020 |
|---|---|---|
| Sales, marketing, and customer support |
47 | 31 |
| Research and development | 65 | 48 |
| Administration | 11 | 15 |
| Total | 123 | 94 |
| Research and development costs, EUR |
2021 | 2020 |
|---|---|---|
| Total | -5,836,431 | -5,047,946 |
| Other operating costs, EUR |
2021 | 2020 |
|---|---|---|
| External services | -3,983,055 | -3,016,512 |
| Depreciation | -2,649,452 | -2,093,238 |
| Other costs | -1,002,783 | -1,205,792 |
| Total | -7,635,290 | -6,315,542 |
| By function | 2021 | 2020 |
|---|---|---|
| Sales and marketing | 8,376 | 12,063 |
| Research and development | 1,672,072 | 1,501,520 |
| Administration | 969,005 | 579,655 |
| Total | 2,649,452 | 2,093,238 |
| EUR | 2021 | 2020 |
|---|---|---|
| Interest revenue | 964 | 631 |
| Exchange rate gains, loans, and other receivables |
171,647 | 798 |
| Total | 172,611 | 631 |
| EUR | 2021 | 2020 |
|---|---|---|
| Exchange rate losses, loans and other receivables |
-133,940 | -458,289 |
| Interest arising from revenue contracts |
-40,842 | -72,222 |
| Interest on lease liabilities | -61,385 | -48,314 |
| Other interest costs | -200,689 | -25,850 |
| Total | -436,857 | -604,675 |
| EUR | 2021 | 2020 |
|---|---|---|
| Income tax | -524,030 | 12,162 |
| Total | -524,030 | 12,162 |
| EUR | 2021 | 2020 |
|---|---|---|
| 7YVÄ[SVZZILMVYL[H_LZ | -1,794,364 | -3,090,264 |
| Tax at parent company tax rate (20 %) |
358,873 | 618,053 |
| ,ɈLJ[VMMVYLPNUZ\IZPKPHYPLZ KPɈLYPUN[H_YH[LZ |
4,966 | -7,877 |
| ,ɈLJ[VMKLMLYYLK[H_LZ | 120,871 | |
| Non-deductible expenses | -209,878 | -19,351 |
| Tax exempt revenue | 18,031 | 72,299 |
| Tax deductible hybrid loan interest expenses |
276,000 | 180,000 |
| Use of previously unrecog nized tax losses |
279,302 | 297,264 |
| Tax assets not recognized for reported losses |
-177,333 | -28,247 |
| Tax assets not recognized for unused tax depreciations |
-824,839 | -1,124,324 |
| Income taxes from previous years |
-3,144 | 25,938 |
| Other direct taxes | -366,878 | -1,593 |
| 0UJVTL[H_LZ | -524,030 | 12,162 |
The amount of Group's unused tax losses, for which no deferred tax asset has been recognized based on the prudence principle, is EUR 8.6 million (2020: EUR 8.1 million). EUR 3.4 million (2020: EUR 2.8 million) of the tax losses are
Auditor's fees categorized into service groups were:
| EUR | 2021 | 2020 |
|---|---|---|
| Principal auditor Ernst & Young Oy | ||
| Statutory auditing | -63,425 | -65,720 |
| Other auditing | -16,725 | -5,625 |
| Other services | -2,352 | -2,009 |
| 6[OLYH\KP[PUNÄYTZ! | ||
| Statutory auditing | -11,068 | -7,050 |
| Other services | -6,464 | -15,158 |
| Total | -100,034 | -95,562 |
| EUR | 2021 | 2020 |
|---|---|---|
| By asset category | ||
| Machinery and equipment | 81,193 | 76,136 |
| Right-of-use assets | 301,343 | 393,566 |
| Software & other tech assets | 1,039,466 | 336,704 |
| Capitalized development costs |
1,227,450 | 1,286,832 |
| Total | 2,649,452 | 2,093,238 |
in Finland, and EUR 5.7 million (2020: EUR 5.2 million) in the USA. The tax losses expire in Finland between the years 2022–2030, and in the USA between the years 2022–2035. The amount of unrecognized deferred tax assets from the tax losses is EUR 1.9 million (2020: EUR 1.7 million). The ÄN\YLZPUJS\KL\ZLVMSVZZLZPU^OPJOOH]LUV[L[ ILLUJVUÄYTLKPU[H\_H[PVU0UHKKP[PVU[OLWHYLU[JVTWHU has EUR 38.5 million (2020: EUR 36.8 million) research and development expenses and depreciations not deducted in taxation and the amount of unrecognized deferred tax assets resulting from those is EUR 7.7 million (2020: EUR 7.3 million).
The Group's subsidiaries do not have earnings that would cause tax consequences when repatriated.
| EUR | 2021 | 2020 |
|---|---|---|
| 7YVÄ[SVZZH[[YPI[HISL to shareholders of the parent company |
-2,318,394 | -2,834,022 |
| Hybrid loan interest expense | -1,380,000 | -1,260,000 |
| Weighted average number of shares in issue, 1,000 |
38,927 | 38,802 |
| Earnings per share | -0.10 | -0.11 |
| Adjusted average number of shares considering dilution LɈLJ[ |
40,843 | 41,529 |
| Earnings per share, diluted | -0.10 | -0.11 |
| EUR | 2021 | 2020 |
|---|---|---|
| Machinery and equipment | ||
| Acquisition cost 1 Jan | 2,094,182 | 2,054,825 |
| ,_JOHUNLYH[LLɈLJ[ | 20,177 | -22,420 |
| Increase | 97,414 | 61,777 |
| Acquisition cost 31 Dec | 2,211,773 | 2,094,182 |
| Accumulated depreciation 1 Jan | 1,979,855 | 1,936,735 |
| ,_JOHUNLYH[LLɈLJ[ | 19,843 | -21,367 |
| +LWYLJPH[PVUMVY[OLÄUHUJPHS period |
69,608 | 64,486 |
| Accumulated depreciation 31 Dec |
2,069,306 | 1,979,855 |
| Book value 31 Dec | 142,467 | 114,327 |
| EUR | 2021 | 2020 |
| Other tangible assets |
| Acquisition cost 1 Jan | 72,389 | 52,876 |
|---|---|---|
| ,_JOHUNLYH[LLɈLJ[ | 4,039 | -4,468 |
| Increase | 23,982 | |
| Acquisition cost 31 Dec | 76,428 | 72,389 |
| Accumulated depreciation 1 Jan | 43,857 | 35,918 |
| ,_JOHUNLYH[LLɈLJ[ | 3,798 | -3,710 |
| +LWYLJPH[PVUMVY[OLÄUHUJPHS period |
11,586 | 11,650 |
| Accumulated depreciation 31 Dec | 59,241 | 43,857 |
| Book value 31 Dec | 17,187 | 28,532 |
| Book value of tangible assets 31 Dec |
159,654 | 142,859 |
| EUR | 2021 | 2020 |
|---|---|---|
| Buildings | ||
| Acquisition cost 1 Jan | 1,375,688 | 581,008 |
| ,_JOHUNLYH[LLɈLJ[ | 31,823 | -34,943 |
| Increase | 255,189 | 829,623 |
| Decrease | -25,004 | |
| Acquisition cost 31 Dec | 1,637,695 | 1,375,688 |
| Accumulated depreciation 1 Jan | 689,283 | 318,870 |
| ,_JOHUNLYH[LLɈLJ[ | 25,813 | -23,153 |
| +LWYLJPH[PVUMVY[OLÄUHUJPHS period |
353,250 | 364,343 |
| Impairment | 29,223 | |
| Accumulated depreciation 31 Dec |
1,068,347 | 689,283 |
| Book value 31 Dec | 569,349 | 686,405 |
9PNO[VM\ZLHZZL[ZPUJS\KLTHPUSSLHZLKVɉJLZHUK software. From the beginning of September 2021 the com-WHUSLHZLKUL^VɉJLZWHJL[VHJJVTTVKH[LPUJYLHZLPU headcount due to acquisition of Deltagon. The new lease contract is for the period of three years and added right-ofuse assets and lease liabilities with EUR 0.1 million in 2021.
More information on leases is presented in the note 22. Leases.
| EUR | 2021 | 2020 |
|---|---|---|
| :VM[^HYL | ||
| Acquisition cost 1 Jan | 2,125,288 | 2,065,632 |
| ,_JOHUNLYH[LLɈLJ[ | 15,347 | 1,401 |
| Increase | 2,535 | 58,255 |
| Acquisition cost 31 Dec | 2,143,170 | 2,125,288 |
| Accumulated depreciation 1 Jan |
2,067,033 | 2,057,842 |
| ,_JOHUNLYH[LLɈLJ[ | 15,347 | 1,523 |
| +LWYLJPH[PVUMVY[OLÄUHUJPHS period |
9,991 | 7,667 |
| Accumulated depreciation 31 Dec |
2,092,371 | 2,067,033 |
| Book value 31 Dec | 50,799 | 58,255 |
| EUR | 2021 | 2020 |
| Immaterial rights | ||
| Acquisition cost 1 Jan | 16,773,132 | 15,235,306 |
| Increase | 10,042,795 | 1,537,826 |
| Acquisition cost 31 Dec | 26,815,927 | 16,773,132 |
| Accumulated depreciation and impairment 1 Jan |
11,383,387 | 9,764,636 |
| +LWYLJPH[PVUMVY[OLÄUHUJPHS period |
2,205,017 | 1,618,751 |
| Accumulated depreciation and impairment 31 Dec |
13,588,404 | 11,383,387 |
| Book value 31 Dec | 13,227,522 | 5,389,744 |
| Goodwill | 8,594,625 | |
| Book value of intangible assets 31 Dec |
21,872,947 | 5,447,999 |
On April 26, 2021, the group's subsidiary Kyberleijona Oy acquired 100% of the voting shares of Deltagon Oy. The acquisition increased the group's customer related and technology based intangible assets EUR 8.5 million and goodwill arising on acquisition EUR 8.6 million, the total increase as a result of the acquisition on the intangible assets being EUR 17.1 million. Customer related and technology based intangible assets are amortized over time, whereas goodwill has PUKLÄUP[L\ZLM\SSPML;OLLZ[PTH[LKYLTHPUPUN\ZLM\SSPMLVM customer related intangible assets is 10 years and technolo-NIHZLKPU[HUNPISLHZZL[ZÄ]LLHYZ
Goodwill is not amortized but is tested at least annually for impairment. The group's goodwill from acquisition is allocated to one the cash generating unit (CGU) which is Deltagon. The recoverable amount from CGU is determined with a ]HS\LPU\ZLTL[OVK\ZPUNÄ]LLHYJHZOÅV^WYVQLJ[PVUZ IHZLKVUÄUHUJPHSLZ[PTH[LZWYLWHYLKI[OLTHUHNLTLU[ *HZOÅV^ZMVY[OLWLYPVKL_[LUKPUNV]LY[OLÄ]L`LHYWSHUning period are calculated using the terminal value method.
The key parameters applied in impairment testing are: PUJYLHZLPUUL[ZHSLZK\YPUN[OLUL_[Ä]LLHYZ Z[LHK growth rate in projecting terminal value 2 % and discount rate 19.0 %. The discount rate is the weighted average pretax cost of capital (WACC). The components of the WACC HYLYPZRMYLLYH[LTHYRL[YPZRWYLTP\TJVTWHU`ZWLJPÄJ risk premium (small stock premium 11.2 %), industry specific equity beta, cost of debt and debt to equity ratio. Tested assets include goodwill, customer related and technology based intangible assets and net working capital.
An asset is impaired when its carrying amount exceeds its recoverable amount. On the basis of the impairment calculations made, there has been no need for impairment for the CGU for the period ended December 31, 2021.
Sensitivity analyses of goodwill have been carried out for the valuation of CGU by making downside scenarios for key parameters. If other parameters remain unchanged, increase in discount rate over 4.0 %, or 7.5 % decrease in growth assumptions would result in impairment.
No goodwill impairment losses were recognized during the accounting period.
At the end of the year, the company has tested the value of intangible assets using a moderate growth rate compared to year 2021 net sales and year 2021 cost structure. The JHZOÅV^MVYLJHZ[ZVMUL^WYVK\J[ZPU[OLTHYRL[HYLIHZLK on year 2022 budget. The discount rate used in the testing was 13 %. As a result of the testing, no impairment risk was detected. According to the sensitivity analyses carried out, L]LUHZPNUPÄJHU[JOHUNLPURL`]HYPHISLZUL[ZHSLZWYVÄ[ ability and discount rate) would not create a situation where the carrying value of an asset would exceed its recoverable amount.
| EUR | 2021 | 2020 |
|---|---|---|
| Total trade receivables | 4,253,848 | 2,961,250 |
| EUR | 2021 | 2020 |
| Deferred revenue | 8,659,315 | 6,361,348 |
| Government grants received | 322,693 | 134,729 |
| Total advances received and deferred revenue |
8,982,009 | 6,496,077 |
| By currency, EUR | 2021 | 2020 |
| EUR | 2,876,388 | 417,572 |
| USD | 714,341 | 2,293,408 |
| GBP | 273,690 | 250,270 |
| CHF | 256,170 | |
| SEK | 133,259 | |
| Total | 4,253,848 | 2,961,250 |
| by age, EUR | 2021 | 2020 |
|---|---|---|
| Non-matured | 3,452,357 | 1,431,762 |
| Matured | ||
| < 30 days | 272,637 | 1,042,358 |
| 31-90 days | 457,382 | 428,128 |
| 80-180 days | 58,389 | 105,865 |
| > 181 days | 145,195 | 377,501 |
| Impairment losses | -132,111 | -424,364 |
| Total | 4,253,848 | 2,961,250 |
The Group does not fully record impairment losses on receivables older than 90 days, as historically credit losses have been very small.
| EUR | 2021 | 2020 |
|---|---|---|
| VAT receivables | 132,632 | 150,020 |
| Deposits | 147,949 | 157,669 |
| Other short-term receivables | 182,932 | 184,836 |
| Total | 463,513 | 492,525 |
The book value of trade receivables and trade payables equals their fair value because the impact of discounting is UV[ZPNUPÄJHU[JVUZPKLYPUN[OLTH[\YP[`VM[OLZLP[LTZ
According to the Articles of Association, SSH Communications Security Corporation has a minimum share capital of EUR 600,000 and a maximum share capital of EUR
2,400,000, within which limits the share capital may be raised or lowered without amending the Articles of Associ-H[PVU;OLUVTPUHS]HS\LVMVULZOHYLPZ,<9"OLUJL the minimum number of shares is 20 million and maximum U\TILYPZTPSSPVU;OLJVTWHU`OHZVULZLYPLZVMZOHYLZ" each share entitles its holder to one vote at the shareholders' meeting. The share capital of the company, registered in the Trade Register and fully paid up as of 31 December 2021 was EUR 1,178,366.97 (2020: EUR 1,164,066.99), and the number of shares was 39,278,899 (2020: 38,802,233).
| Changes in the share cap P[HS! |
Number of shares |
Share capital, EUR |
|---|---|---|
| 31 Dec 2020 | 38,802,233 | 1,164,067 |
| Subscriptions under stock option plan |
476,666 | 14,300 |
| Subscriptions under share issue |
||
| 31 Dec 2021 | 39,278,899 | 1,178,367 |
The share capital includes the share subscription prices from share issues and share subscriptions through options unless the conditions of the share issue stipulate that the subscription price shall be registered in the unrestricted invested equity fund. Expenses related to share issue are deducted from retained earnings.
;OL[YHUZSH[PVUKPɈLYLUJLZM\UKJVTWYPZLZ[OLL_JOHUNL YH[LKPɈLYLUJLZHYPZPUNMYVT[OL[YHUZSH[PVUVM[OLÄUHUJPHS statements of the foreign subsidiaries.
The item 'Fair value and other reserves' consists of two
KPɈLYLU[M\UKZ!HMHPY]HS\LYLZLY]LMVYH]HPSHISLMVYZHSL investments and a hedging reserve for changes in the fair ]HS\LVMJHZOÅV^OLKNPUNPUZ[Y\TLU[Z0U[OLHUK ÄUHUJPHSWLYPVKZ::/*VTT\UPJH[PVUZ:LJ\YP[OHK UVH]HPSHISLMVYZHSLÄUHUJPHSHZZL[ZHUKKPKUV[HWWS hedge accounting.
The unrestricted equity fund consists of the dissolved share premium fund formed by share subscriptions under option rights and includes share subscription prices insofar as not YLNPZ[LYLKHZZOHYLJHWP[HSIHZLKVUHZWLJPÄJKLJPZPVU
Hybrid capital securities is an instrument that is subordinated to the Company's other debt obligations and does not have maturity date (i.e. it is perpetual). It is treated as equity PU[OL0-9:ÄUHUJPHSZ[H[LTLU[Z/`IYPKJHWP[HSZLJ\YP[PLZKV not confer to their holders any rights of shareholders and do not dilute the holdings of the current shareholders.
The other equity fund consists of hybrid capital securities of EUR 12 million issued in March 2015, subscribed by institutional investors. The principal owner of the parent company, Mr. Tatu Ylönen, subscribed EUR 500,000 of the O`IYPKJHWP[HSZLJ\YP[PLZ;OLJHWP[HSZLJ\YP[PLZILHYHÄ_LK interest rate of 7.5 per cent until 30 March 2020, after which the interest rate will increase by four percentage points to 11.5 per cent. The capital securities have no maturity date, but the issuer has the right to redeem them after 3 but before 5 years from the issue date, upon certain conditions, or after 5 years from the issue date. The investors had the right to convert the capital loan into the Company's shares at EUR 4.76 per share until 30 March 2020.
The objective in managing Group capital is to secure the ability to continue operating. The structure of the capital can be managed through decisions concerning, for instance,
dividends and other distribution of assets, purchase of the company's own shares, and share issues. Capital management concerns equity recognized in the balance sheet. There are no requirements imposed by outside parties on the Group's capital management. In March 2015 the Group issued hybrid capital securities which are included in the Group's equity.
The indicators depicting the capital structure are the equity ratio and gearing.
| Net liabilities | ||
|---|---|---|
| EUR | 2021 | 2020 |
| Interest-bearing liabilities | 2,827,000 | 582,000 |
| Lease liabilities | 591,270 | 714,772 |
| Cash and cash equivalents | 8,207,229 | 8,517,698 |
| Net liabilities | -4,788,959 | -7,220,926 |
| Equity total | 12,025,739 | 8,465,026 |
| Equity ratio | 44.63 % | 69.70 % |
| Gearing | -39.82 % | -85.30 % |
The interest-bearing liabilities consist of the subordinated loan EUR 0.6 million which Kyberleijona Oy has taken out from the non-controlling interest holder State Security Networks Group Finland, and a premium loan received from ELO mutual pension insurance company EUR 2.2 million. The capital and interest of the subordinated loan can only be repaid in circumstances permitted by Chapter 12 of the Finnish Limited Liability Companies Act. The capital of the subordinated loan can only be repaid to the extent the unrestricted shareholders' equity and the total amount of the subordinated loan at the time of the repayment exceeds the SVZZ[OH[PZ[VILJVUÄYTLKMVY[OLJVTWHU`»ZSH[LZ[ÄUHUcial year or is included in the balance sheet of more recent ÄUHUJPHSZ[H[LTLU[Z;OLHUU\HSPU[LYLZ[MVY[OLZ\IVYKP-
nated loan, three per cent (3 %), has been recognized as expense.
In the company's industry, it is common practice internationally that incentives are provided to employees in the form of equity settled share-based instruments, such as options. Personnel of the company belong to options plans. An employee leaving the company before the vesting of the options forfeits their options.
On the balance sheet date, SSH Communications Security had 1,915,334 stock options outstanding (2020: 2,727,000), representing 4.6 % of shares and 4.6 % of votes. The weighted average exercise price of outstanding stock options was EUR 1.4 (2020: EUR 1.9). The weighted average of the remaining subscription period was 1.2 years (2020: 2.2 years). The exercise price varies from EUR 0.93 to EUR 2.09, and the remaining subscription period from 0.2 years to 2.3 years.
A person holding option rights is entitled to subscribe shares if employed by SSH at the beginning of the subscription period.
| Option plan | Option JLY[PÄJH[L |
Release date |
Subscription period | Subscription price, EUR |
Options not L_JLYJPaLK |
|
|---|---|---|---|---|---|---|
| Begin | End | |||||
| 2018 | 2018 | 22 Feb 2018 | 1 Dec 2020 | 31 Mar 2022 | 2.09 | 503,334 |
| 2019 A | 2019 A | 18 Dec 2018 | 1 Dec 2021 | 31 Mar 2023 | 1.56 | 980,000 |
| 2020 A | 2020 A | 13 Feb 2020 | 1 Dec 2022 | 31 Mar 2024 | 0.93 | 980,000 |
| Total | 2,463,334 |
| 2021 | 2020 | |
|---|---|---|
| At the beginning of [OLÄUHUJPHSWLYPVK |
2,727,000 | 2,425,575 |
| Stock options granted | 218,000 | 1,688,000 |
| Stock option forfeited | 553,000 | 710,100 |
| Stock options expired | 676,475 | |
| Stock options exercised | 476,666 | |
| ([[OLLUKVM[OLÄUHUJPHS period |
1,915,334 | 2,727,000 |
| ,_LYJPZHISLVW[PVUYPNO[Z H[[OLLUKVM[OLÄUHUJPHS period |
1,915,334 | 2,727,000 |
The fair value is of option programs is determined at the time the options are granted and is recorded as an expense in [OLWYVÄ[SVZZK\YPUN[OLWLYPVKVMPUJLW[PVU;OLMHPY]HS\LPZ determined using the Black-Scholes pricing model. The parameters for options granted in 2021 are:
| 2021 | |
|---|---|
| Share price at grant, EUR | 2.55 |
| :OHYLWYPJLH[ÄUHUJPHS period end, EUR |
3.01 |
| Exercise price, EUR | 1.43 |
| Expected volatility1 | 70.9 % |
| Maturity, years | 1.79 |
| Risk-free rate | -0.71 % |
| Expected dividends, EUR | 0.00 |
| Valuation model | Black-Scholes |
| Fair value 31 Dec 2021, EUR | 285,128 |
1 The expected volatility has been determined by calculating the historical volatility of the company's shares using monthly observations over corresponding maturity.
| Share-based payments YLJVNUPaLKHZHUL_WLUZL EUR |
2021 | 2020 |
|---|---|---|
| Share-based payments, equity-settled |
479,238 | 131,031 |
| Liability from share-based payments 31 Dec |
0 | 0 |
| EUR | 2021 | 2020 |
|---|---|---|
| Trade payables | 567,519 | 398,156 |
| Personnel related | 2,808,350 | 1,559,165 |
| Accruals | 55,426 | 95,733 |
| VAT liabilities | 373,317 | 75,967 |
| Other liabilities | 2,205,131 | 248,029 |
| Total | 6,009,743 | 2,377,051 |
;OL .YV\W PZ L_WVZLK [V ÄUHUJPHS YPZRZ PU P[Z UVYTHS I\ZPness. The purpose of the Group's risk management is to min-PTPaL ULNH[P]L PTWHJ[Z VM JOHUNLZ VU ÄUHUJPHS THYRL[Z [V Group in-come.
The Group operates internationally and is exposed to foreign L_JOHUNL YPZR [OLTVZ[ZPNUPÄJHU[J\YYLUJ`ILPUN [OL<: dollar. The company reduces risk based on net position, using foreign exchange forwards or options. Currently the net position is not hedged. The company decides on the hedging on case by case basis. Currently the Group is not using hedging accounting. Any gains or losses realized through OLKNPUNHJ[PVUZHYL[O\ZYLJVNUPaLKPUWYVMP[SVZZ
A 10 % strengthening of the U.S. dollar against the Euro
using with net position on 31 Dec 2021 would increase the WYL[H_WYVÄ[VM[OL.YV\WIL\YVZ:PTPSHYSH weakening of the U.S. dollar against the Euro would decrease [OLWYL[H_WYVÄ[VM[OL.YV\WI`L\YVZ
The interest-bearing debt of the Group at the end of the review period was EUR 2,827,000 and it consisted of a subordinated loan EUR 582,000 taken by a subsidiary company from a non-controlling interest holder, and a premium loan taken from ELO mutual pension insurance company EUR 2,245,000. The annual interest of the subordinated loan is three per cent (3 %). The interest rate of the premium loan consists of reference interest rate and added margin 0,50 %. 21.6.2021 when loan was drawn the calculated annual rate of premium loan was 0,80 %.
The money market investments of the Group expose the JHZOÅV^[VPU[LYLZ[YH[LYPZRI[[OLPYPTWHJ[PZUV[TH[LYPHS
The Group's cash reserves have been invested in accordance with the policy approved by the Board of Directors. At the LUK VM [OL ÄUHUJPHS YLWVY[PUN WLYPVK HSS [OL HZZL[Z HYL PU ]LZ[LKPUJHZOPUÄUHUJPHSPUZ[P[[PVUZ^P[OOPNOJYLKP[YH[PUNZ
;OL.YV\WOHZUVZPNUPÄJHU[JVUJLU[YH[PVUZVMJYLKP[YPZR([ [OLLUKVM[OLÄUHUJPHS`LHY[OL.YV\WYLJVYKLKPTWHPYTLU[ losses of EUR 0.1 million to cover doubtful receivables. The aging distribution of trade receivables is presented in note 14. Trade receivables.
The Group's cash and cash equivalents on 31 Dec 2021 were 8,207,229 euros (2020: 8,517,698 euros). The Group has no liquidity risks, since invested funds which are substan-tial JVTWHYLK[V[OL.YV\W»ZJHZOÅV^ZHYLH]HPSHISLVUHVUL day notice.
The Group had trade payables and other short-term
debts amounting 4,334,743 euros (2020: 2,377,051 euros). The outstanding installments from Deltagon acquisition and payments of premium loan from ELO mutual pension insurance company maturing less than one year amount 2,170,000 euros.
Agreements concerning credit facilities and loan guarantees include a covenant for the adequate liquidity and subordination of the hybrid loan interest payments to the credit facili-ty guarantee. Non-compliance with the covenant would lead to deferral of the hybrid in-terest payment until such time the terms and conditions of the covenant would not restrict payment of the interest or when the credit facility is repaid. Breach of covenant would re-quire material deterioration of the liquidity from the current.
;OL[HISLZILSV^WYLZLU[[OL.YV\W»ZTH[\YP[`VM[OLÄUHUJPHSSPHIPSP[PLZ!
| 31 DEC 2021 | ||||
|---|---|---|---|---|
| EUR | Less than 1 year | 1 to 5 years | Over 5 years | Total |
| nterest-bearing liabilities | 500,000 | 1,745,000 | 582,000 | 2,827,000 |
| Outstanding installments from Deltagon acquisition |
1,670,000 | 3,166,096 | - | 4,836,096 |
| Lease liabilities | 371,791 | 219,479 | - | 591,270 |
| Trade and other payables | 4,334,743 | - | - | 4,334,743 |
| Total | 6,876,534 | 5,130,575 | 582,000 | 12,589,109 |
| 31 DEC 2020 | ||||
| EUR | Less than 1 year | 1 to 5 years | Over 5 years | Total |
| Interest-bearing liabilities | - | - | 582,000 | 582,000 |
| Lease liabilities | 329,417 | 385,355 | - | 714,772 |
| Trade and other payables | 2,377,051 | - | - | 2,377,051 |
| Total | 2,706,468 | 385,355 | 582,000 | 3,673,823 |
;OL[HISLZILSV^WYLZLU[JOHUNLZPUSPHIPSP[PLZHYPZPUNMYVTÄUHUJPUNHJ[P]P[PLZ!
| EUR | 1 Jan 2021 |
Cash ÅV^Z |
Foreign L_JOHUNL movement |
5L^ leases |
Other | 31 Dec 2021 |
|---|---|---|---|---|---|---|
| Current lease liabilities | 329,417 | -386,328 | 9,742 | 92,248 | 326,711 | 371,791 |
| Current interest-bearing borrowings | 500,000 | 500,000 | ||||
| Other current liabilities | 1,670,000 | 1,670,000 | ||||
| Non-current interest-bearing borrowings | 582,000 | 1,745,000 | 2,327,000 | |||
| Non-current lease liabilities | 385,355 | 5,735 | 155,101 | -326,711 | 219,480 | |
| Other non-current liabilities | 3,166,096 | 3,166,096 | ||||
| ;V[HSSPHIPSP[PLZMYVTÄUHUJPUNHJ[P]P[PLZ | 1,296,772 | 1,858,672 | 15,477 | 247,349 | 4,836,096 | 8,254,366 |
| EUR | 1 Jan 2020 |
Cash ÅV^Z |
Foreign L_JOHUNL movement |
5L^ leases |
Other | 31 Dec 2020 |
|---|---|---|---|---|---|---|
| Current lease liabilities | 200,925 | -374,466 | -9,977 | 297,180 | 215,756 | 329,417 |
| Non-current interest-bearing borrowings | 582,000 | - | - | - | - | 582,000 |
| Non-current lease liabilities | 73,237 | -4,569 | 532,443 | -215,756 | 385,355 | |
| ;V[HSSPHIPSP[PLZMYVTÄUHUJPUNHJ[P]P[PLZ | 856,162 | -374,466 | -14,546 | 829,623 | 0 | 1,296,772 |
;OLJVS\TU¸6[OLY¹PUJS\KLZUVUJHZOTV]LTLU[ZZ\JOHZYLJSHZZPÄJH[PVUMYVTUVUJ\YYLU[[VJ\YYLU[
The Group has recognized the following amounts related to the leases in the balance sheet.
| Right-of-use assets | ||
|---|---|---|
| EUR | 2021 | 2020 |
| 6ɉJLZ | 429,062 | 554,973 |
| Software | 99,703 | 131,432 |
| Other | 40,583 | |
| Total | 569,349 | 686,405 |
| Lease liabilities | ||
|---|---|---|
| EUR | 2021 | 2020 |
| Current | 371,791 | 329,417 |
| Non-current | 219,479 | 385,355 |
| Total | 591,270 | 714,772 |
Additions to the right-of-use assets during 2021 were in total EUR 0.3 million (2020: EUR 0.8 million). Changes in right-ofuse assets have been presented in note 12. Right-of-use assets.
The Group has recognized the following amounts related to the leases in the income statement:
| EUR | 2021 | 2020 |
|---|---|---|
| Depreciation charge of right of-use assets |
-379,064 | -393,566 |
| Interest expenses (included in ÄUHUJPHSJVZ[Z |
-61,385 | -48,314 |
| Expense relating to short term leases (included in other operating costs) |
-30,386 | -59,131 |
| Expense relating to leases of low-value assets (included in other operating costs) |
-7,886 | -1,791 |
;OL JHZO V[ÅV^ MVY SLHZLZ PU ^HZ PU [V[HS ,<9 million (2020: EUR 0.4 million).
| EUR | 2021 | 2020 |
|---|---|---|
| Rental guarantees (pledged) |
147,949 | 157,669 |
| Hybrid Loan, Interest | 1,035,000 | 1,035,000 |
On April 26, 2021, the Group's subsidiary Kyberleijona Oy acquired 100% of the voting shares of Deltagon Oy, an unlisted company based in Finland. The purchase price consideration of Deltagon Oy includes an earn-out consideration. The earnout consideration is payable as one lump-sum payment at [OLSH[LZ[VU[OI\ZPULZZKH`HM[LY[OLÄUHUJPHSZ[H[LTLU[Z for the accounting period ending on 31.12.2023 have been adopted by the Annual General Meeting of Kyberleijona Oy. Total amount of earn-out consideration will not exceed EUR 1,300,000. On 31 December 2021, the estimated earn out consideration of Deltagon acquisition is EUR 650,000. More information about Deltagon acquisition can be found on note
25.
SSH Communications Security Corporation, its subsidiaries, its CEO, and its Board members and companies controlled by them belong to related party of the Group. The Group man-agement team is not considered as part of related party as they do not have direct decision-making authority.
| Group companies Dec 31 2021 | Domicile | Group holding, % | Votes, % |
|---|---|---|---|
| SSH Communications Security Oyj, Helsinki | Finland | ||
| SSH Communications Security Inc., New York City | USA | 100 | 100 |
| SSH Operations Oy, Helsinki | Finland | 100 | 100 |
| SSH Communications Security Ltd., Hong Kong | Hong Kong | 100 | 100 |
| Kyberleijona Oy, Helsinki | Finland | 65 | 65 |
| Deltagon Oy | Finland | 100 | 100 |
| SSH Government Solutions Inc., New York City | USA | 100 | 100 |
| SSH Technology Oy, Helsinki | Finland | 100 | 100 |
| SSH Communications Security UK Ltd, London | United Kingdom | 100 | 100 |
;OL RLTHUHNLTLU[ WLYZVUULS VM [OL .YV\W HYL KLÄULK consisting of the CEO of the parent company. The employee ILULÄ[Z VM [OL \*,6 HYL WYLZLU[LK PU [OL [HISL ILSV^ ;OL Z\TZVMLTWSVLLILULÄ[ZHYLZOV^UVUHUHJJY\HSIHZPZ The CEO of SSH Communications Security Corporation has been Mr. Teemu Tunkelo as of 24 March 2020.
| Remuneration and fees – CEO | ||
|---|---|---|
| EUR | 2021 | 2020 |
:HSHYHUKV[OLYZOVY[[LYTLTWSVLLILULÄ[Z |
262,703 | 284,978 |
| ;LYTPUH[PVUILULÄ[Z | 111,451 | |
| Total | 262,703 | 396,429 |
| Fees to Members of the Board of Directors | ||
|---|---|---|
| EUR | 2021 | 2020 |
| Curry Sam (until 26 March 2020) | 7,500 | |
| Fredrikson Christian (as of 25 March 2021) | 18,435 | |
| Kellomäki Sampo (as of 26 March 2020) | 24,000 | 18,000 |
| Kiianmies Aino-Mari (until 25 March 2021) | 6,000 | 18,000 |
| Kiuru Sauli (until 26 March 2020) | 7,500 | |
| Kuivala Petri (until 26 March 2020) | 8,750 | |
| Tavakka Kai (as of 26 June 2020) | 24,000 | 12,286 |
| Syrjälä Timo (until 26 March 2020) | 7,500 | |
| Ylönen Tatu (until 25 March 2021) | 7,500 | |
| Zettlemoyer Anne Marie (until 26 March 2020) | 7,500 | |
| Österlund Henri (as of 26 June 2020, Chairman of the Board) | 28,800 | 14,743 |
| Total | 101,235 | 109,279 |
| Share and stock option holdings of Board members |
31 Dec 2021 Shares |
31 Dec 2021 Options |
31 Dec 2020 Shares |
31 Dec 2020 Options |
|---|---|---|---|---|
| Fredrikson Christian | ||||
| Kellomäki Sampo | ||||
| Tavakka Kai | 5,480 | |||
| Österlund Henri | 119,627 | 61,060 | ||
| Total | 125,107 | - | 61,060 | - |
| Share and stock option holdings of the key management |
31 Dec 2021 Shares |
31 Dec 2021 Options |
31 Dec 2020 Shares |
31 Dec 2020 Options |
|---|---|---|---|---|
| Tunkelo Teemu (CEO as of 24 March 2020) |
77,043 | 425,000 | 20,300 | 475,000 |
| Mononen Jussi | 4,619 | 279,000 | 370,000 | |
| Nordström Niklas | 50,000 | |||
| Total | 81,662 | 754,000 | 20,300 | 845,000 |
| Compensation of the key management personnel of the group | ||
|---|---|---|
| EUR | 2021 | 2020 |
| >HNLZHUKV[OLYZOVY[[LYTLTWSV`LLILULÄ[Z | 633,344 | 1,179,520 |
| Share-based payments | 38,280 | - |
On 31 December 2020, the CEO and members of the Board of Directors of SSH Communications Security owned 18.2 % (2019: 47.2 %) of the shares and votes in the company, either directly or indirectly through companies they own.
Management group members including the CEO directly or indirectly held about 0.1 % (2019: 0 %) of company shares and have a total of 1,150,000 (2019: 225,000) option rights.
The key conditions of the option right arrangements are described in note 19. Share-based payments.
+\YPUN[OLYLWVY[PUNWLYPVK[OLYLOH]LUV[ILLUHU`ZPNUPÄcant transactions with related parties.
On April 26, 2021, the Group's subsidiary Kyberleijona Oy acquired 100% of the voting shares of Deltagon Oy, an unlisted company based in Finland that develops and sells secure messaging and transaction solutions to various PUK\Z[YPLZPUJS\KPUNÄUHUJLHUK[OLW\ISPJZLJ[VY(THQVYP[of Deltagon's revenue is generated from the secure email TLZZHNPUNZVS\[PVU:LJ'.>[OH[OHZILLUJLY[PÄLKI[OL National Cyber Security Authority at the Finnish Transport and Communications Agency (NCSA-FI) for protecting JSHZZPÄLK PUMVYTH[PVU HJJVYKPUN [V [OL -PUUPZO UH[PVUHS (FI) ST III and ST IV security requirements. The Group has acquired Deltagon because it complements SSH's product and services portfolio and creates synergies in product development, developing future quantum resistance, and leveraging international sales and marketing channels. The acquisition has been accounted for using the acquisition TL[OVK ;OL JVUZVSPKH[LK ÄUHUJPHS Z[H[LTLU[Z PUJS\KL [OL results of Deltagon from the acquisition date April 26 until December 31, 2021
Details of purchase consideration, the net assets acquired, and goodwill are as follows:
| Purchase consideration | 2021 |
|---|---|
| >HNLZHUKV[OLYZOVY[[LYTLTWSV`LLILULÄ[Z | 633,344 |
| Share-based payments | 38,280 |
| Cash paid | 5,000,000 |
| Deferred purchase price | 4,853,477 |
| Considerations shares | 5,390,000 |
| Closing adjustments | 1,532,844 |
| Earnout consideration | 650,000 |
| Total purchase consideration | 17,426,321 |
| Assets | Fair value recognised on acquisition |
|---|---|
| Intangible assets | |
| Customer related intangible assets | 8,138,079 |
| Technology related intangible assets | 360,485 |
| Trade and other receivables | 2,002,741 |
| Cash | 1,358,579 |
| 11,859,884 | |
| Liabilities | |
| Trade and other payables | -1,328,476 |
| Deferred tax liability | -1,699,713 |
| -3,028,189 | |
| ;V[HSPKLU[PÄHISLUL[HZZL[ZH[MHPY]HS\L | 8,831,696 |
| Goodwill arising on acquisition | 8,594,625 |
| Purchase consideration transferred | 17,426,321 |
| (UHS`ZPZVMJHZOÅV^ZVUHJX\PZP[PVU! | |
| 5L[JHZOHJX\PYLK^P[O[OLZ\IZPKPHY`PUJS\KLKPUJHZOÅV^ZMYVT investing activi-ties) |
1,358,579 |
| Cash paid | -5,996,349 |
| 5L[JHZOÅV^VUHJX\PZP[PVU | -4,637,770 |
The total purchase price was EUR 17.4 million. Cash component of EUR 5.0 million was paid at closing, EUR 1.0 million in July and EUR 5.4 million of consideration shares were recog-nized in equity. Deferred purchase price EUR 4.9 million consists of the present value of three additional installments of EUR 1.67 million paid in the years 2022, 2023, and 2024. The installments have been discounted at the estimated cost of debt (2.1%). A closing ad-justment of EUR 1.5 million was based on the net cash position and net working capital ad-justment on the closing date.
The goodwill recognized is attributed to the Deltagon's WYVÄ[HIS`NYV^PUNI\ZPULZZ^P[OHZ[YVUNWVZP[PVUPU[OLKVmestic messaging security market, new international business, and a wide customer base.
;YHUZHJ[PVUJVZ[Z^LYLUV[ZPNUPÄJHU[HUKOH]LILLUL_- WLUZLKHUKPUJS\KLKPU[OLHKTPUPZ[YH[P]LL_WLUZLZPUWYVÄ[ or loss.
No acquisitions or divestments were closed in 2020.
There have been no material events after the balance sheet date
| EUR | Note | 1 Jan-31 Dec 2021 |
1 Jan-31 Dec 2020 |
|---|---|---|---|
| NET SALES | 1 | 9,638,427.83 | 7,006,767.78 |
| Purchasing and production costs | -2,004.75 | -451.33 | |
| GROSS MARGIN | 9,636,423.08 | 7,006,316.45 | |
| Other operating income | 769,294.68 | 645,229.02 | |
| Research and development costs | 2, 3, 6 | -5,536,311.17 | -5,159,333.65 |
| Sales and marketing costs | 2, 3, 6 | -3,414,951.56 | -2,615,628.82 |
| Administrative costs | 2, 3, 6 | -2,950,521.47 | -2,369,383.91 |
| OPERATING PROFIT/LOSS | -1,496,066.43 | -2,492,800.91 | |
| Financial income | 7 | ||
| 0U[LYLZ[PUJVTLHUKV[OLYÄUHUJPUNPUJVTL | 3,787,885.79 | 548,857.58 | |
| 0U[LYLZ[JVZ[ZHUKV[OLYÄUHUJPUNJVZ[Z | -386,444.21 | -465,899.39 | |
| PROFIT/LOSS BEFORE APPROPRIATIONS AND TAXES | 1,905,375.15 | -2,409,842.72 | |
| Appropriations | 8 | ||
| Group contribution received | 12,028.50 | 16,864.78 | |
| PROFIT/LOSS BEFORE TAXES | 1,917,403.65 | -2,392,977.94 | |
| Taxes | 0.00 | 0.00 | |
| PROFIT/LOSS FOR THE FINANCIAL PERIOD | 1,917,403.65 | -2,392,977.94 |
| ASSETS | |||
|---|---|---|---|
| EUR | Note | 31 Dec 2021 | 31 Dec 2020 |
| NON-CURRENT ASSETS | |||
| Intangible assets | 9 | ||
| Immaterial rights | 3,191,018.02 | 3,162,965.59 | |
| Intangible assets, total | 3,191,018.02 | 3,162,965.59 | |
| Tangible assets | 9 | ||
| Machinery & equipment | 107,972.41 | 116,918.81 | |
| Tangible assets, total | 107,972.41 | 116,918.81 | |
| Investments | |||
| Shares in Group companies | 9, 19 | 14,896,037.61 | 3,889,689.01 |
| Other shares | 11,000.00 | 11,000.00 | |
| Investments, total | 14,907,037.61 | 3,900,689.01 | |
| NON-CURRENT ASSETS, TOTAL | 18,206,028.04 | 7,180,573.41 | |
| CURRENT ASSETS | |||
| Current receivables | |||
| Trade receivables | 1,958,039.05 | 488,393.59 | |
| Receivables from Group companies | 10 | 5,354,053.47 | 5,328,229.56 |
| Prepaid expenses and accrued income | 11 | 196,303.32 | 216,048.95 |
| Other receivables | 12 | 255,515.83 | 317,283.49 |
| Current receivables, total | 7,763,911.67 | 6,349,955.59 | |
| Cash and cash equivalents | 2,369,368.20 | 2,744,865.26 | |
| CURRENT ASSETS, TOTAL | 10,133,279.87 | 9,094,820.85 | |
| ASSETS, TOTAL | 28,339,307.91 | 16,275,394.26 |
EQUITY AND LIABILITIES
| EUR | Note | 31 Dec 2021 | 31 Dec 2020 |
|---|---|---|---|
| EQUITY | 13 | ||
| Share capital | 1,178,366.97 | 1,164,066.99 | |
| Unrestricted invested equity fund | 23,702,087.81 | 22,720,155.85 | |
| Hybrid capital securities | 14 | 12,000,000.00 | 12,000,000.00 |
| 9L[HPULKWYVÄ[SVZZ | -24,183,082.79 | -20,410,104.85 | |
| 7YVÄ[SVZZMVYÄUHUJPHSWLYPVK | 1,917,403.65 | -2,392,977.94 | |
| EQUITY, TOTAL | 14,614,775.64 | 13,081,140.05 | |
| LIABILITIES | |||
| NON-CURRENT LIABILITIES | |||
| Pension loan | 15 | 1,745,000.00 | |
| Payables to Group companies | 15,16 | 3,340,000.00 | |
| NON-CURRENT LIABILITIES, TOTAL | 5,085,000.00 | ||
| CURRENT LIABILITIES | |||
| Advances received | 2,607,972.72 | 1,080,577.73 | |
| Trade payables | 238,786.47 | 326,744.86 | |
| Payables to Group Companies | 16 | 3,234,464.53 | 398,369.66 |
| Accrued expenses and deferred income | 17 | 1,647,035.42 | 1,219,070.76 |
| Pension loan | 500,000.00 | ||
| Other liabilities | 411,273.13 | 169,491.20 | |
| CURRENT LIABILITIES, TOTAL | 8,639,532.27 | 3,194,254.21 | |
| LIABILITIES, TOTAL | 13,724,532.27 | 3,194,254.21 | |
| EQUITY AND LIABILITIES, TOTAL | 28,339,307.91 | 16,275,394.26 |
| EUR | 1 Jan-31 Dec 2021 |
1 Jan-31 Dec 2020 |
|---|---|---|
| *HZOÅV^MYVTI\ZPULZZVWLYH[PVUZ | ||
| Receipts from customers | 9,839,634.26 | 9,461,880.39 |
| Payments to suppliers and employees | -9,048,311.77 | -9,001,780.48 |
| *HZOÅV^MYVTI\ZPULZZVWLYH[PVUZILMVYLÄUHUJPHSP[LTZHUK[H_LZ | 791,322.49 | 460,099.91 |
| 0U[LYLZ[HUKV[OLYÄUHUJPHSJVZ[Z | -103,151.06 | -26,641.36 |
| 0U[LYLZ[HUKV[OLYÄUHUJPHSYL]LU\L | 3,207,999.07 | 507,457.58 |
| *HZOÅV^MYVTI\ZPULZZVWLYH[PVUZ | 3,896,170.50 | 940,916.13 |
| *HZOÅV^MYVTPU]LZ[PUNHJ[P]P[PLZ | ||
| Investments in tangible and intangible assets | -1,570,947.88 | -1,555,202.07 |
| Investments in subsidiaries | -5,996,348.60 | |
| Receipt of government grants | 1,417,532.20 | 271,188.17 |
| *HZOÅV^MYVTPU]LZ[PUNHJ[P]P[PLZ | -6,149,764.28 | -1,284,013.90 |
| *HZOÅV^MYVTÄUHUJPUNHJ[P]P[PLZ | ||
| Change of non-current debt | 1,745,000.00 | |
| Change in current debt | 500,000.00 | |
| Interest on hybrid capital securities | -1,380,000.00 | -900,000.00 |
| Proceeds from shares subscribed with option rights | 996,231.94 | |
| Group contribution received | 16,864.78 | 8,154.97 |
| *HZOÅV^MYVTÄUHUJPUNHJ[P]P[PLZ | 1,878,096.72 | -891,845.03 |
| Change in liquid assets | -375,497.06 | -1,234,942.80 |
| Liquid assets in the beginning of period | 2,744,865.26 | 3,979,808.06 |
| Change in liquid assets | -375,497.06 | -1,234,942.80 |
| Liquid assets at the end of period | 2,369,368.20 | 2,744,865.26 |
;OL ÄUHUJPHS Z[H[LTLU[ VM [OL WHYLU[ JVTWHU` ::/ Communications Security Corpora-tion, is drawn up in accordance with the Finnish Accounting Standards. Figures are given to an accuracy of one cent (EUR 0.01). All items in the balance sheet are recognized at original acquisition cost. 0UMVYTH[PVUVUÄUHUJPHSYPZRTHUHNLTLU[PZWYLZLU[LKPU[OL JVUZVSPKH[LK ÄUHUJPHS Z[H[LTLU[Z 5V[L Financial Risk Management)
The revenue from product sales is recognized at the time ^OLUZPNUPÄJHU[YPZRZHUKYL^HYKZVM[OLWYVK\J[VY[OLYPNO[ of use of the product have been transferred to the buyer and there is a binding contract between the parties, the delivery has taken place in accordance with the contract, the amount of revenue can be measured reliably, and it is probable that [OL LJVUVTPJ ILULÄ[Z HZZVJPH[LK ^P[O [OL [YHUZHJ[PVU ^PSS accrue to the Group. Control is transferred to the buyer at the point of time.
Revenue from services rendered under maintenance agreements are amortized across the agreement period. Revenues from services are recognized when the service has ILLUKLSP]LYLKHUKP[PZWYVIHISL[OH[[OLLJVUVTPJILULÄ[Z associated with the transaction will accrue to the Group.
Revenue from subscription contracts are amortized across the agreement period.
The revenue of royalties from licenses is recognized according to the actual content of the contract at the point of time.
Costs are apportioned to functions according to the matching principle.
;OLWHYLU[JVTWHU`OHZYLU[HSHNYLLTLU[MVYVɉJLWYLTPZLZ
at Karvaamokuja 2B, Helsinki and minor other assets. Leasing payments paid pursuant to these agreements are recognized as costs over the rental or leasing period under agreements.
The income tax in the income statement comprises direct [H_LZ IHZLK VU [OL [H_HISL WYVÄ[ MVY [OL ÄUHUJPHS WLYPVK HUKHKQ\Z[TLU[Z[V[H_LZVUWYL]PV\ZÄUHUJPHSWLYPVKZ;OL parent company does not recognize deferred tax receivables VY SPHIPSP[PLZ PU P[Z ÄUHUJPHS Z[H[LTLU[ ;OL WHYLU[ JVTWHU` OHZJVUÄYTLK[H_SVZZLZVM,<9TPSSPVU!,<9 million). In addition, the parent company has EUR 38.5 million (2020: EUR 36.8 million) research and development expenses and depreciations not deducted in taxation, whereof no deferred tax asset has been recognized.
Fixed assets are recognized in the balance sheet at acquisition cost less planned depreciation and any impairment. Planned depreciations are calculated on a straight-line basis according to the economic life of each asset category.
The asset categories and their depreciation periods are:
| Machinery and equipment | 5 years from month of acquisition |
|---|---|
| Computer hardware | 3 years from month of acquisition |
| Immaterial rights | 5 years from month of acquisition |
| Development costs | 5 years from month of capitalization |
| Other capitalized expen diture |
5 years from year of capi talization |
Leasehold approvements of rental premises
Length of the rental agreement, though no more than 7 years, from year of capitalization
Research and development costs are recognized as costs in [OLÄUHUJPHSWLYPVKPU^OPJO[OL`VJJ\YYLKL_JLW[MVY[OVZL product development costs which are capitalized once certain criteria have been met. Capitalized development expenses are depreciated sys-tematically over their useful lives.
Transactions denominated in foreign currencies are recognized at the exchange rate on the transaction date. Outstanding receivables and liabilities in foreign currencies are recognized using the exchange rates on the balance sheet date. Exchange rate gains and losses on actual business operations are considered sales adjustment items or adjust-ment items to materials and services. Exchange YH[LNHPUZHUKSVZZLZVUÄUHUJPUNHJ[P]P[PLZHYLYLJVNUPaLK \UKLYÄUHUJPUNPUJVTLHUKJVZ[Z
Employees of the parent company and its subsidiaries have been granted option rights. The option rights entitle their OVSKLYZ[VZ\IZJYPILZOHYLZPU[OLWHYLU[JVTWHU`H[HÄ_LK Z\IZJYPW[PVUWYPJLZWLJPÄLKPU [OL [LYTZVM [OLVW[PVUWSHU No costs are recog-nized in the income statement or balance sheet regarding the granting of option rights.
Hybrid capital securities is an equityrelated instrument that is presented as a separate item in equity. Interest payments on hybrid capital securities are decided by the Board. Unpaid interest accumulated at the balance sheet date is presented in note 18. Other commitments.
| EUR | 2021 | 2020 |
|---|---|---|
| Finland | 2,065,274.68 | 2,432,052.63 |
| Rest of Europe | 4,491,819.81 | 1,214,151.04 |
| Other | 3,081,333.34 | 3,360,564.11 |
| Total | 9,638,427.83 | 7,006,767.78 |
| EUR | 2021 | 2020 |
|---|---|---|
| Other operating costs | ||
| External services | -2,549,757.72 | -1,832,280.68 |
| Depreciation | -1,149,816.48 | -1,221,521.35 |
| Other | -1,616,603.36 | -1,766,820.27 |
| Total | -5,316,177.56 | -4,820,622.30 |
| EUR | 2021 | 2020 |
|---|---|---|
| Principal auditor (Ernst & Young Oy) | ||
| Statutory auditing | -50,400.00 | -65,720.00 |
| Other auditing | -7,305.00 | |
| Other services | -19,077.00 | -329.00 |
| Total | -69,477.00 | -73,354.00 |
| Personnel costs | ||
|---|---|---|
| EUR | 2021 | 2020 |
| Wages and salaries | -6,393,514.17 | -5,507,723.65 |
| Pension costs | -969,552.66 | -765,499.67 |
| Other ancillary personnel costs |
-238,760.99 | -184,601.46 |
| Total | -7,601,827.82 | -6,457,824.78 |
| Average number of employees |
2021 | 2020 |
|---|---|---|
| 76 | 66 |
| 2021 | 2020 | |
|---|---|---|
| Research and development | 54 | 47 |
| Sales and marketing | 16 | 13 |
| Administration | 11 | 13 |
| Total | 81 | 73 |
:LLUV[LPU[OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z
| EUR | 2021 | 2020 |
|---|---|---|
| Immaterial rights | 249,395.50 | 195,229.45 |
| Capitalized development costs |
838,300.32 | 977,883.03 |
| Machinery and equipment |
62,120.66 | 48,408.87 |
| Total | 1,149,816.48 | 1,221,521.35 |
In 2021 or in 2020, the company did not record any impairments.
| EUR | 2021 | 2020 |
|---|---|---|
| Interest income | 738,420.19 | 56,284.71 |
| Received payment of impaired internal loan |
2,755,580.05 | 492,572.87 |
| Exchange rate gains and losses (net) |
7,905.23 | -460,208.29 |
| Interest, expenses and V[OLYÄUHUJPHSJVZ[Z |
-100,464.16 | -5,691.10 |
| Total | 3,401,441.31 | 82,958.19 |
| EUR | 2021 | 2020 |
|---|---|---|
| Group contribution from SSH Technology Oy |
12,028.50 | 16,864.78 |
| Total | 12,028.50 | 16,864.78 |
| EUR | 2021 | 2020 |
|---|---|---|
| Intangible assets | ||
| Immaterial rights | ||
| Acquisition cost 1 Jan | 14,846,432.33 | 13,806,553.00 |
| Increase | 1,115,748.25 | 1,039,879.33 |
| Acquisition cost 31 Dec | 15,962,180.58 | 14,846,432.33 |
| Accumulated deprecia tion 1 Jan |
11,683,466.74 | 10,507,472.19 |
| Depreciation for the ÄUHUJPHSWLYPVK |
1,087,695.82 | 1,175,994.55 |
| Accumulated deprecia tion 31 Dec |
12,771,162.56 | 11,683,466.74 |
| Book value 31 Dec | 3,191,018.02 | 3,162,965.59 |
| Machinery and equipment | ||
|---|---|---|
| Acquisition cost 1 Jan | 1,851,053.88 | 1,769,775.43 |
| Increase | 53,174.26 | 81,278.45 |
| Acquisition cost 31 Dec | 1,904,228.14 | 1,851,053.88 |
| Accumulated deprecia tion 1 Jan |
1,734,135.07 | 1,685,726.20 |
| Depreciation for the ÄUHUJPHSWLYPVK |
62,120.66 | 48,408.87 |
| Accumulated deprecia tion 31 Dec |
1,796,255.73 | 1,734,135.07 |
| Book value 31 Dec | 107,972.41 | 116,918.81 |
| Investments | ||
|---|---|---|
| Book value 1 Jan | 3,900,689.01 | 3,900,689.01 |
| Increase | 11,006,348.60 | 0.00 |
| Book value 31 Dec | 14,907,037.61 | 3,900,689.01 |
The parent company has granted a subordinated loan in total of EUR 1,080,000 (2020: EUR 1,080,000) to Kyberleijona Oy. The capital and interest of the subordinated loan can only be re-paid in circumstances permitted by Chapter 12 of the Finnish Limited Liability Companies Act. The capital of the subordinated loan can only be repaid to the extent the unrestricted shareholders' equity and the total amount of the subordinated loan at the time of the repayment exceeds the SVZZ [OH[PZ [VILJVUÄYTLKMVY [OLJVTWHU`»ZSH[LZ[ÄUHUcial year or is included in the balance sheet of more recent ÄUHUJPHSZ[H[LTLU[Z;OLHUU\HSPU[LYLZ[MVY[OLSVHUPZ[OYLL per cent (3 %). As part of the cooperation agreement between SSH and State Security Networks Group Finland, SSH has strengthened the equity of Kyberleijona in 2018 by EUR 2,532,022.86.
| EUR | 2021 | 2020 |
|---|---|---|
| Trade receivables | 5,342,024.97 | 5,362,186.29 |
| Group contribution receivable |
12,028.50 | 16,864.78 |
| Total | 5,354,053.47 | 5,379,051.07 |
| EUR | 2021 | 2020 |
|---|---|---|
| Prepaid expenses | 196,303.32 | 216,048.95 |
| Total | 196,303.32 | 216,048.95 |
| EUR | 2021 | 2020 |
|---|---|---|
| Other receivables | 255,515.83 | 317,283.49 |
| Total | 255,515.83 | 317,283.49 |
| EUR | 2021 | 2020 |
|---|---|---|
| Share capital 1 Jan | 1,164,066.99 | 1,164,066.99 |
| Increase in share capital |
14,299.98 | - |
| Share capital 31 Dec | 1,178,366.97 | 1,164,066.99 |
| Unrestricted invested equity fund |
23,702,087.81 | 22,720,155.85 |
| Hybrid capital securities | 12,000,000.00 | 12,000,000.00 |
| Retained earnings | -24,183,082.79 | -20,410,104.85 |
| 7YVÄ[SVZZMVY[OL ÄUHUJPHSWLYPVK |
1,917,403.65 | -2,392,977.94 |
| Total | 14,614,775.64 | 13,081,140.05 |
| Statement on Distrib utable Funds, EUR |
2021 | 2020 |
|---|---|---|
| Retained earnings | -24,183,082.79 | -20,410,104.85 |
| 7YVÄ[3VZZMVY[OLÄUHU cial period |
1,917,403.65 | -2,392,977.94 |
| Unrestricted invested equity fund |
23,702,087.81 | 22,720,155.85 |
| Capitalized develop ment costs |
-2,164,941.90 | -2,025,684.59 |
| Total | -728,533.23 | -2,108,611.53 |
A hybrid capital security is an instrument that is subordinated to the Company's other debt obligations and It does not have maturity date (i.e. it is perpetual). It is treated as equity in the ÄUHUJPHSZ[H[LTLU[Z/`IYPKJHWP[HSZLJ\YP[PLZKVUV[JVUMLY to their holders any share-holder rights and do not dilute the holdings of the current shareholders.
Hybrid capital securities in the amount of EUR 12 million were issued in March 2015 and subscribed by institutional PU]LZ[VYZ;OLJHWP[HSZLJ\YP[PLZILHYHÄ_LKPU[LYLZ[YH[LVM 7.5 per cent until 30 March 2020, after which the interest rate will increase by four percentage points. The capital securities have no maturity date, but the issuer has the right to redeem them after 3 but before 5 years from the issue date, upon certain conditions, or after 5 years from the issue date. The investors had the right to convert the capital loan into the Company's shares at EUR 4.76 per share until 30 March 2020.
Paid interest from hybrid capital securities reduce the amount of retained earnings. Unpaid interest from hybrid capital securities is presented in note 18. Other commitments. 7HPKPU[LYLZ[PU [OL ÄUHUJPHS `LHY^HZ,<9 (2020: EUR 900,000).
| EUR | 2021 | 2020 |
|---|---|---|
| Pension loans payable | ||
| )L[^LLUVULHUKÄ]L years |
1,745,000.00 | |
| Pension loans, total | 1,745,000.00 | 0.00 |
| Liabilities to subsidiaries | ||
| )L[^LLUVULHUKÄ]L years |
3,340,000.00 | |
| Liabilities to subsidiaries, total |
3,340,000.00 | 0.00 |
| Non-current liabilities, total |
5,085,000.00 | 0.00 |
In 2021, company received a premium loan from ELO mutual pension insurance company. Total amount of the loan on 31 December, 2021 is EUR 2,450,000 of which 1,745,000 is non-current. Non-current liabilities to subsidiaries consist of the company's commitment to invest to Kyberleijona Oy the outstanding installments of Deltagon acquisition.
| EUR | 2021 | 2020 | |
|---|---|---|---|
| Non-current liabilities to subsidiaries | |||
| Other liabilities | 3,340,000.00 | ||
| Non-current liabilities to subsidiaries, total |
3,340,000.00 | 0.00 | |
| Current liabilities to subsidiaries | |||
| Trade payables | 1,545,703.61 | 398,369.66 | |
| Other liabilities | 1,688,760.92 | ||
| Current liabilities to subsidiaries, total |
3,234,464.53 | 398,369.66 | |
| Liabilities to subsidiaries, total |
6,574,464.53 | 398,369.66 |
Non-current other liabilities to subsidiaries consist of the company's commitment to invest to Kyberleijona Oy the outstanding installments of Deltagon acquisition EUR 3,340,000. Current other liabilities to subsidiaries include current portion of outstanding installment of Deltagon acquisition EUR 1,670,000.
| EUR | 2021 | 2020 |
|---|---|---|
| Personnel related | 1,645,742.29 | 1,159,848.13 |
| Accruals | 1,293.13 | 59,222.63 |
| Total | 1,647,035.42 | 1,219,070.76 |
| EUR | 2020 | 2019 | |
|---|---|---|---|
| 5VUJHUJLSSHISLSLHZLHNYLLTLU[ZMVYVɉJLMHJPSP[PLZ – future rent payments |
|||
| Within one year | 246,268.06 | 203,510.56 | |
| Within more than one year but no more than 5 years |
137,985.15 | 264,532.21 | |
| Commitments to group companies | |||
| Within one year | 1,670,000.00 | ||
| Within more than one year but no more than 5 years |
3,340,000.00 | ||
| Other commitments | |||
| Within one year | 70,814.88 | 58,510.22 | |
| Within more than one year but no more than 5 years |
46,815.54 | 97,517.03 | |
| Total | 5,511,883.62 | 624,070.02 |
Commitments to group companies consist of the company's commitment to invest to Kyberleijona Oy the outstanding installments of Deltagon acquisition.
| EUR | 2021 | 2020 | |
|---|---|---|---|
| Guarantees given and other commitments | |||
| Rental guarantees (pledged) |
128,127.90 | 130,696.90 | |
| Hybrid Loan, Interest | 1,035,000.00 | 1,035,000.00 | |
| Parent and subsidiary relationships of the Group 31 December 2021 |
Domicile | Group Holding, % | Votes, % |
|---|---|---|---|
| SSH Communications Security Oyj, Helsinki | Finland | ||
| SSH Communications Security Inc., New York City | USA | 100 | 100 |
| SSH Operations Oy, Helsinki | Finland | 100 | 100 |
| SSH Communications Security Ltd., Hong Kong | Hong Kong | 100 | 100 |
| Kyberleijona Oy, Helsinki | Finland | 65 | 65 |
| SSH Government Solutions Inc., New York City | USA | 100 | 100 |
| SSH Technology Oy, Helsinki | Finland | 100 | 100 |
| SSH Communications Security UK Ltd, London | United Kingdom | 100 | 100 |
;OLWHYLU[JVTWHU»ZKPZ[YPI\[HISLM\UKZHYL,<9VM^OPJO[OLWYVÄ[MVY[OLÄUHUJPHSLHYPZ EUR 1,917,403.65. The Board of Directors proposes to the Annual General Meeting on 25 March, 2022 that UVKP]PKLUKVYYL[\YUVMJHWP[HSZOHSSILKPZ[YPI[LK0[PZWYVWVZLK[OH[[OLWYVÄ[VM[OLÄUHUJPHS`LHYZOHSSIL entered to the retained earnings in the shareholders' equity.
Helsinki, 23 February 2022
HENRI ÖSTERLUND Chairman of the Board of Directors
SAMPO KELLOMÄKI CHRISTIAN FREDRIKSON Member of the Board of Directors Member of the Board of Directors
KAI TAVAKKA Member of the Board of Directors
TEEMU TUNKELO *OPLM,_LJ[P]L6ɉJLY
Our auditors' report has been issued today.
Helsinki, 23 February 2022
Ernst & Young Oy Authorized Public Accountants
ERKKA TALVINKO Authorized Public Accountant
To the Annual General Meeting of SSH Communications Security Oyj
L OH]L H\KP[LK [OL ÄUHUJPHS Z[H[LTLU[Z VM ::/ Communications Security Oyj (business identity code 1035804-9) for the year ended 31 December, 2021. The ÄUHUJPHS Z[H[LTLU[Z JVTWYPZL [OL JVUZVSPKH[LK IHSHUJL sheet, income statement, statement of comprehensive income, statement of changes in equity, statement of JHZO ÅV^Z HUK UV[LZ PUJS\KPUN H Z\TTHY` VM ZPNUPÄJHU[ accounting policies, as well as the parent company's balance ZOLL[PUJVTLZ[H[LTLU[Z[H[LTLU[VMJHZOÅV^ZHUKUV[LZ
Our opinion is consistent with the additional report submitted to the Board of Directors.
We conducted our audit in accordance with good auditing practice in Finland. Our responsibilities under good auditing practice are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the parent company and of the group companies in accordance with the ethical requirements that are applicable in Finland and are relevant to our H\KP[HUK^LOH]LM\SÄSSLKV\YV[OLYL[OPJHSYLZWVUZPIPSP[PLZPU accordance with these requirements.
In our best knowledge and understanding, the non-audit services that we have provided to the parent company and group companies are in compliance with laws and regulations applicable in Finland regarding these services, and we have not provided any prohibited non-audit services referred [VPU(Y[PJSLVM YLN\SH[PVU,<;OLUVUH\KP[ services that we have provided have been disclosed in note [V[OLJVUZVSPKH[LKÄUHUJPHSZ[H[LTLU[Z
We believe that the audit evidence we have obtained is Z\ɉJPLU[HUKHWWYVWYPH[L[VWYV]PKLHIHZPZMVYV\YVWPUPVU
Key audit matters are those matters that, in our professional Q\KNTLU[^LYLVMTVZ[ZPNUPÄJHUJLPUV\YH\KP[VM[OLÄUHUcial statements of the current period. These matters were ad-KYLZZLKPU[OLJVU[L_[VMV\YH\KP[VM[OLÄUHUJPHSZ[H[LTLU[Z as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
LOH]LM\SÄSSLK[OLYLZWVUZPIPSP[PLZKLZJYPILKPU[OLAuditor's Responsibilities for the Audit of the Financial Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of TH[LYPHSTPZZ[H[LTLU[VM[OLÄUHUJPHSZ[H[LTLU[Z;OLYLZ\S[Z of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit VWPUPVUVU[OLHJJVTWHU`PUNÄUHUJPHSZ[H[LTLU[Z
We have also addressed the risk of management override of internal controls. This includes consideration of whether there was evidence of management bias that represented a risk of material misstatement due to fraud.
| Key Audit Matter | /V^V\YH\KP[HKKYLZZLK[OL2L`(\KP[4H[[LY |
|---|---|
| Revenue Recognition We refer to the group's accounting policies and the notes 2 and 3. The group has multiple revenue sources including license sales, maintenance and Z\IZJYPW[PVUZHSLZHUKJVUZ\S[PUNZLY]PJLZ;OLNYV\W»ZYL]LU\LMVY[OLÄUHUJPHS LHY<br>amounted to 15.9 million euros, which mostly comprised of license sales and maintenance<br>and subscription sales.<br>According to the group's accounting policies, maintenance and subscription sales are<br>recognized evenly on an accrual basis throughout the contract period, and license sales are<br>recognized when the right of use of the product is granted to the buyer. Consulting sales are<br>recognized as the related consulting work is performed for the client.<br>;OLYLPZHYPZRVMPUJVYYLJ[[PTPUNVMYL]LU\LYLJVNUP[PVUK\L[V[OL]HYPV\ZKPɈLYLU[[LYTZ<br>and conditions included in the group's sales contracts. Revenue recognition was determined<br>[VILHRLH\KP[TH[[LYHUKHZPNUPÄJHU[YPZRVMTH[LYPHSTPZZ[H[LTLU[ YLMLYYLK [VPU,< 9LN\SH[PVU5VWVPU[JVM(Y[PJSL |
Our audit procedures to address the risk of material misstatement in respect of revenue recognition included the following procedures: < LL]HS\H[LK[OLYL]LU\LYLJVNUP[PVUWYPUJPWSLZHWWSPLKI [OLNYV\WMYVT[OLWLYZWLJ[P]L<br>of the applicable accounting standards.<br><<br>LL]HS\H[LK<br>[OL<br>YL]LU\L<br>YLJVNUP[PVUVMKPɈLYLU[ZV\YJLZVM<br>YL]LU\LPU<br>YLSH[PVU<br>[V<br>[OL<br>terms and conditions of the sales contracts.<br><<br>L[LZ[LK[OLJVYYLJ[ULZZVM[OL[PTPUNVMYL]LU\LYLJVNUP[PVU<br><<br>LL]HS\H[LK[OLHWWYVWYPH[LULZZHUKZ\ɉJPLUJ |
| Acquisition accounting of Deltagon Oy We refer to the group's accounting policies and the notes 2 and 25. ;OLNYV\WHJX\PYLK+LS[HNVU6 K\YPUN<br>[OLÄUHUJPHSLHYMVY[OLW\YJOHZLWYPJLVM 17.4 million euros. The acquisition was material from the audit perspective because the valuation processes and methods used in the acquisition accounting required management judgment. The management judgments involved assumptions and estimates on determin ing the fair value of acquired assets and liabilities, and the allocation of the purchase price PU[VPKLU[PÄHISLHZZL[ZZ\JOHZJ\Z[VTLYJVU[YHJ[ZHUK[LJOUVSVN | Our audit procedures regarding the accounting and presentation of the acquisition in the<br>ÄUHUJPHSZ[H[LTLU[ZPUJS\KLK[OLMVSSV^PUNWYVJLK\YLZ!<br><<br>L<br>L]HS\H[LK<br>[OL<br>JVTWSPHUJL<br>VM<br>[OL<br>NYV\W»Z<br>HJX\PZP[PVU<br>HJJV\U[PUN<br>^P[O<br>[OL<br>0-9:<br><br>Business Combinations standard.<br><<br>L<br>L]HS\H[LK<br>^P[O<br>[OL<br>HZZPZ[HUJL<br>VM<br>,@<br>]HS\H[PVU<br>ZWLJPHSPZ[Z<br>[OL<br>]HS\H[PVU<br>WYVJLZZLZ<br>and methods used by the management to determine the fair values of acquired assets<br>HUKSPHIPSP[PLZHUK<br>[OLHSSVJH[PVUVM<br>[OLW\YJOHZLWYPJLIL[^LLUPKLU[PÄHISLHZZL[ZHUK<br>liabilities.<br><<br>LL]HS\H[LK[OLHWWYVWYPH[LULZZHUKZ\ɉJPLUJVM[OLUV[LZYLSH[LK[V[OLHJX\PZP[PVU |
The Board of Directors and the Managing Director are re-ZWVUZPISLMVY[OLWYLWHYH[PVUVMJVUZVSPKH[LKÄUHUJPHSZ[H[Lments that give a true and fair view in accordance with International Financial Reporting Standards (IFRS) as adopted by [OL,<HUKVMÄUHUJPHSZ[H[LTLU[Z[OH[NP]LH[Y\LHUKMHPY view in accordance with the laws and regulations governing [OLWYLWHYH[PVUVMÄUHUJPHSZ[H[LTLU[ZPU-PUSHUKHUKJVTWS` with statutory requirements. The Board of Directors and the Managing Director are also responsible for such internal control as they determine is necessary to enable the preparation VMÄUHUJPHSZ[H[LTLU[Z [OH[HYLMYLLMYVTTH[LYPHSTPZZ[H[Lment, whether due to fraud or error.
0UWYLWHYPUN[OLÄUHUJPHSZ[H[LTLU[Z[OL)VHYKVM+PYLJtors and the Managing Director are responsible for assessing the parent company's and the group's ability to continue as going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of ac-JV\U[PUN ;OL ÄUHUJPHS Z[H[LTLU[Z HYL WYLWHYLK \ZPUN [OL going concern basis of accounting unless there is an intention to liquidate the parent company or the group or cease operations, or there is no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance on whether [OL ÄUHUJPHS Z[H[LTLU[Z HZ H ^OVSL HYL MYLL MYVT TH[LYPHS misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with good auditing practice will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could YLHZVUHIS`ILL_WLJ[LK[VPUÅ\LUJL[OLLJVUVTPJKLJPZPVUZ VM\ZLYZ[HRLUVU[OLIHZPZVM[OLÄUHUJPHSZ[H[LTLU[Z
As part of an audit in accordance with good auditing practice, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
[V[OLYLSH[LKKPZJSVZ\YLZPU[OLÄUHUJPHSZ[H[LTLU[ZVYPM such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the parent company or the group to cease to continue as a going concern.
We communicate with those charged with governance regarding, among other matters, the planned scope and [PTPUN VM [OL H\KP[ HUK ZPNUPÄJHU[ H\KP[ ÄUKPUNZ PUJS\KPUN HUZPNUPÄJHU[KLÄJPLUJPLZPUPU[LYUHSJVU[YVS[OH[^LPKLU[PM during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of TVZ[ZPNUPÄJHUJLPU [OLH\KP[VM [OLÄUHUJPHSZ[H[LTLU[ZVM the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably ILL_WLJ[LK[VV[^LPNO[OLW\ISPJPU[LYLZ[ILULÄ[ZVMZ\JO communication.
L^LYL ÄYZ[ HWWVPU[LK HZ H\KP[VYZI` [OL(UU\HS.LULYHS Meeting on 20.4.2016, and our appointment represents a total period of uninterrupted engagement of 6 years.
The Board of Directors and the Managing Director are responsible for the other information. The other information comprises the report of the Board of Directors and the information included in the Annual Report, but does not include [OLÄUHUJPHSZ[H[LTLU[ZHUKV\YH\KP[VY»ZYLWVY[[OLYLVU>L have obtained the report of the Board of Directors prior to the date of this auditor's report, and the Annual Report is expected to be made available to us after that date.
6\YVWPUPVUVU [OL ÄUHUJPHS Z[H[LTLU[ZKVLZUV[JV]LY the other information.
0UJVUULJ[PVU^P[OV\YH\KP[VM[OLÄUHUJPHSZ[H[LTLU[Z V\Y YLZWVUZPIPSP[PZ [V YLHK [OL V[OLY PUMVYTH[PVU PKLU[PÄLK above and, in doing so, consider whether the other informa- [PVUPZTH[LYPHSSPUJVUZPZ[LU[^P[O[OLÄUHUJPHSZ[H[LTLU[ZVY our knowledge obtained in the audit, or otherwise appears to be materially misstated. With respect to report of the Board of Directors, our responsibility also includes considering whether the report of the Board of Directors has been prepared in accordance with the applicable laws and regulations.
In our opinion, the information in the report of the Board VM +PYLJ[VYZ PZ JVUZPZ[LU[ ^P[O [OL PUMVYTH[PVU PU [OL ÄUHUcial statements and the report of the Board of Directors has been prepared in accordance with the applicable laws and regulations.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Helsinki, 23 February 2022
Ernst & Young Oy Authorized Public Accountant Firm
Erkka Talvinko Authorized Public Accountant
SSH Communications Security is committed to transparent and responsible corporate governance through the compliance with laws, regulations, and best practices as well as high ethical standards applied in its governance and decision-making. SSH Communications Security's corporate governance practices are subject to its articles of association, Finnish Limited Liability Companies Act, securities market legislation, including the market abuse regulation, rules of Nasdaq Helsinki, and Finnish Corporate Governance Code 2020. The Corporate Governance Code is available at www.cgfinland.fi.
For more information on the governance practices of the company, see our Corporate Governance Statement that is published annually as a separate report and can be found at SSH's website.
SSH implements a one-tier governance model where the management and supervision of the SSH Group is the responsibility of the General Meeting of shareholders, the Board of Directors, and the CEO assisted by Executive Management Team. Duties are defined by the Finnish Limited Liability Companies Act and the company's articles of association.
SSH Communications Security's highest decisionmaking body is the General Meeting, which is composed of the company's shareholders. The General Meeting makes decisions on matters falling within its competence as stipulated by the Finnish Limited Liability Companies Act and the company's articles of association.
The Annual General Meeting elects the Board of Directors and the auditors. The Board of Directors is responsible for strategic management and decides on the SSH Group's administrative systems and ensures compliance with applicable legislation and good governance principles.
A Remuneration Policy was presented in AGM 2020 and is intended to be valid until the AGM 2024. Remuneration Report will be presented to the Annual General Meeting annually.
The board appoints the CEO, who is in charge of the operative, day-to-day management of the company. CEO is assisted in his/her work by the Executive Management Team.
More information can be found from the annual Corporate Governance Statement and from the company website.
SSH operates in a socially and ethically responsible manner, respects the environment and society, promotes internationally proclaimed human rights, and ensures ethical business practices at all times.
SSH has a clear Anti-Bribery & Anti- Corruption Policy which prohibits all forms of bribery and corruption. The policy is communicated to all employees during new employee training. Any allegations of bribery or corruption will be investigated thoroughly. The Anti-Bribery & Anti-Corruption Policy is available on our web site.
SSH has a whistle-blower process which is initiated when someone reports suspected internal or external misconduct or violation of law, regulations, human rights, labor practices or similar within the operations of SSH Group or by its personnel.
SSH has introduced a Code of Conduct as a generally applied guideline describing the expected conduct at SSH Communications Security. It is created for the benefit of all employees, partners, and other stakeholders to promote a high standard of professional conduct and uniformity within the company. SSH expects professional, honest, and respectful conduct in all business dealings and relationships with colleagues, customers, and any other people with whom SSH is involved with.
SSH respects the surrounding environment and aims to make sure that all of its o"ces are green and energy-e"cient, and environmental impacts are maintained as low as possible. Most of the environmental impact comes from energy consumption of the o"ces, which is minimized by reusing supplies and recycling. SSH HQ operates in a modern and energy e"cient o"ce space, which has received LEED Platinum certification.
Travel emissions from employee commuting and business travelling are minimized by supporting remote working and online conferencing options. All employees of SSH have the right to a safe and healthy working environment where personal well-being is promoted, and any form of discrimination or harassment is prohibited. Every employee is treated with equal consideration and fairness. All decisions concerning employment are determined by the employee's performance, not on any discriminatory grounds, such as gender, age, nationality, ethnicity, religion, political a"liation, disability, or sexual orientation. All full-time employees are part of a performance management program.
SSH is also certified as a Nasdaq ESG Transparency Partner. This certification is used by Nasdaq to signal engagement in market transparency and in raising environmental standards. The Nasdaq ESG Matrix includes data points from Environmental, Social, Corporate Governance as well as Future Sustainability Goals all of which SSH considers in its operation.
SSH is in the process of building a comprehensive ESG and climate strategy performance metrics which will be published in the Annual Report for the fiscal year 2022.
SSH considers diversity as a strength and actively encourages diversity throughout the organization. The principles on diversity are always taken into account when considering nominations to di!erent positions.
Employee statistics at the end of 2021:
All published investor information, including annual reports, interim reports and stock exchange releases are available on the company's website at www.ssh.com/investors. All investor information is published in English. Stock exchange releases, annual general meeting material and interim reports are also published in Finnish.
Subscriptions to the emailing list for stock exchange releases can be made by sending your contact details to [email protected].
SSH follows a silent period starting 30 days before the publication of its financial reports, during which company refrains from contact with representatives of the capital markets and financial media.
The company's Annual General Meeting 2022 will be held on Friday 25th of March 2022.
The company will publish the following financial reports during 2022:
| FY 2021 Financial Statements Bulletin | February 24, 2022 |
|---|---|
| FY 2021 Annual Report | Week 11 |
| Business Review, January–March (Q1) | April 28, 2022 |
| Half-year report, January–June (Q2) | July 21, 2022 |
| Business Review, January–September (Q3) | October 27, 2022 |
In its Business Reviews, SSH will publish a summarized report of key financials as well as CEO review.
Listing since 2000 Nasdaq Helsinki Ltd. Trading symbol SSH1V Number of shares 39,371,379
For any inquiries, please contact: [email protected]
| EUROPE / HEADQUARTERS | UNITED STATES | HONG KONG |
|---|---|---|
| SSH Communications Security Corporation |
SSH Communications Security Inc. |
Security Ltd. |
| Karvaamokuja 2 B | 434 W 33rd Street, Suite 842 |
New York, NY, 10001, USA Tel: +1 781 247 2100 Email: [email protected]
35/F Central Plaza 18 Harbour Road Wan Chai, Hong Kong Tel: +852 2593 1182 Email: [email protected]
SSH Communications Security UK Ltd.
Tel. +44 7714 646604 Email: [email protected]
00380 Helsinki, Finland Tel: +358 20 500 7000 Email: [email protected]
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