Innofactor Plc — Interim / Quarterly Report 2011

Nov 1, 2011

Innofactor Plc's interim report for January 1 - September 30, 2011 (IFRS)

Innofactor Plc's interim report for January 1 - September 30, 2011 (IFRS)

Espoo, Finland, 2011-11-01 07:30 CET (GLOBE NEWSWIRE) -- Innofactor Plc Stock
Exchange Release November 1, 2011, at 8:30 Finnish time

Summary

Innofactor group's key figures for July 1-September 30, 2011:

-- Net sales EUR 3,766 thousand (2010: 2,192), increase of 71.8%
-- Operating profit before depreciation and amortization (EBITDA) EUR 412
thousand (2010: 93), increase of 343.0%
-- EBITDA percentage 10.9% (2010: 4.2%)
-- Operating profit (EBIT) EUR 280 thousand (2010: 23)
-- EBIT percentage 7.4% (2010: 1.0%)

Innofactor group's key figures for January 1-September 30, 2011:

-- Net sales EUR 12,069 thousand (2010: 6,550), increase of 84.3%
-- Operating profit before depreciation and amortization (EBITDA) EUR 837*
thousand (2010: 519), increase of 61.3%
-- EBITDA percentage 6.9%* (2010: 7.9%)
-- Operating profit (EBIT) EUR 441* thousand (2010: 310)
-- EBIT percentage 3.7%* (2010: 4.7%)

* The figures include one-off costs related to the relisting and the
consolidation of shares to the amount of about EUR 200 thousand during January
1-March 31, 2011, and to the amount of about EUR 100 thousand during April
1-June 30, 2011.

The future outlook for Innofactor remains the same. The group's net sales in
2011 are estimated to be about EUR 17 million, which will be an increase of 70%
compared to 2010. Additionally, operating profit before depreciation and
amortization (EBITDA) are expected to be higher both in euros and in percentage
than in 2010 (2010: EUR 979 thousand and 9.9 percent).

Key figures of the group

The figures in this interim report have not been audited.

    mo. 7-9     mo. 7-9     Change  mo. 1-9     mo. 1-9     Change  mo.

1-12
/2011 /2010 /2011 /2010 /2010

---

--

--
Net 3,766 2,192 +71.8% 12,069 6,550 +84.3%
9,862
sales
,
EUR
thousa
nd
Operat 412 93 +343.0 837 519 +61.3%
979
ing %
profit
before
deprec
iation
and
amorti
zation
(EBITD
A),
EUR
thousa
nd*
percen 10.9% 4.2% 6.9% 7.9%
9.9%
tage
of
net
sales
*
Operat 280 23 +1,091 441 310 +42.3%
702
ing .9%
profi
t
(EBIT)
,
EUR
thous
and*
percen 7.4% 1.0% 3.7% 4.7%
7.1%
tage
of
net
sales
*
Profit 274 24 +1,055 429 308 +39.3%
696
befor .6%
e
taxes,
EUR
thous
and*
percen 7.3% 1.1% 3.6% 4.7%
7.1%
tage
of
net
sales
*
Profit 205 17 +1,090 326 224 +45.5%
505
for .9%
the
period
,
EUR
thousa
nd*
percen 5.4% 0.8% 2.7% 3.4%
5.1%
tage
of
net
sales
*
Equity 12,604 2,288 +450.9 12,604 2,288 +450.9
12,278
, EUR % %
thousa
nd
Return 6.6% 3.1% 3.5% 12.2%
6.8%
on
equity
**
Return 8.9% 4.3% 4.7% 17.0%
9.7%
on
invest
ment**
Net -0.9% -11.2% -0.9% -11.2%
-14.0%
geari
ng
Equity 76.5% 48.5% 76.5% 48.5%
68.6%
ratio
Balanc 17,539 5,052 +247.2 17,539 5,052 +247.2
19,517
e % %
sheet
total,
EUR
thous
and
Resear 468 1,716
1,173
ch and
develo
pment,
EUR
thousa
nd***
percen 12.4% 14.2%
11.9%
tage
of
net
sales
***
Person 178 104 +71.2% 175 98 +78.6%
108
nel on
averag
e
during
the
review
perio
d
Person 184 128 +43.8% 184 128 +43.8%
171
nel at
the
end
of
the
revie
w
period
Number 29,261,800 19,314,925 +51.5% 29,261,800 19,314,925 +51.5%
29,261,849
of
shares
at the
end of
the
review
period
****
Earnin 0.0070 0.0010 +594.5 0.0111 0.0126 -11.2%
0.0274
gs per %
share
(EUR)*
***
Shareh 0.431 0.118 +263.6 0.431 0.118 +263.6
0.420
olders % %
'
equity
per
share
(EUR)*
***

---

--

* The figures include one-off costs related to the relisting and the
consolidation of shares to the amount of about EUR 200 thousand during January
1-March 31, 2011, and to the amount of about EUR 100 thousand during April
1-June 30, 2011.

** The percentages for the return on equity and return on investment have been
adjusted to correspond with the figures for a 12-month period.

*** There are no comparison data for the corresponding review period in 2010 as
Innofactor did not draft comparable interim reports in 2010 due to the reverse
acquisition in accordance with IFRS 3.

**** The number of shares before December 27, 2010, presented in the table has
been calculated from the number of Innofactor Oy shares due to the reverse
acquisition in accordance with IFRS 3. In accordance with the decision of the
Innofactor Plc's Annual General Meeting on April 28, 2011, twenty old shares
were consolidated into one new share (registered in the Trade Register on May
7, 2011), which reduced the total number of shares to 1/20 of the previous
number. The key figures presented in the table have been adjusted to correspond
with the current number of shares.

Reporting

Innofactor Plc operates on a single segment and mainly in Finland, offering
software, systems and related services. No distribution of net sales or
earnings by segment or geographical area is therefore presented.

CEO Sami Ensio's review:

During July 1-September 30, 2011, Innofactor's net sales grew by 71.8 percent
from the corresponding period last year. Organic growth during July 1-September
30, 2011, was about 32.6 percent and inorganic growth about 39.2 percent due to
the acquisition of Westend ICT. Growth for the whole year is expected to be
about 70%.

Research and development continued to focus on new versions of old products and
on Innofactor's first cloud solutions. Research and development costs
recognized in the profit and loss statement were EUR 468 thousand during July
1-September 30, 2011 (there is no comparison figure available for the same
period in 2010; total research and development costs in 2010 were EUR 1,173
thousand).

Operating profit before depreciation and amortization (EBITDA) during July
1-September 30, 2011, were EUR 412 thousand (10.9%) and operating profit (EBIT)
were EUR 280 thousand (7.4%).

In May 2011, the company launched a cost-effectiveness program, which places
special emphasis on unifying and improving practices related to project
management and resource allocation and cutting other business costs. Other
operating expenses on the period of July 1-September 30, 2011, were EUR 675
thousand, which is EUR 346 thousand less than in the previous quarter of April
1-June 30, 2011. The share of other operating expenses of the net sales during
July 1-September 30, 2011, decreased to about 17.9 percent, whereas in the
previous year, during July 1-September 30, 2010, it was about 20.4 percent.
Profitability for the rest of the year is expected to improve due to our strong
order book and the planned decrease in research and development from the first
half of the year.

Innofactor continues to seek potential strategic partnerships in Finland and
neighboring countries. The group will seek growth, which can be organic or
based on mergers or acquisitions.

Market outlook and business environment

In June 2011, Innofactor was awarded the Microsoft Country Partner of the Year,
which reinforced the company's position as one of Microsoft's key partners in
Finland. This has also given the company positive publicity outside of Finland.

On July 10, 2011, at the Microsoft Worldwide Partner Conference in Los Angeles,
USA, Innofactor launched its new cloud services. These services drew a fair
amount of attention, and Innofactor believes there is a significant
international market for them.

Regardless of the uncertain financial situation, Innofactor's short-term market
outlook is fairly positive. The current market situation is uncertain and,
thus, Innofactor will not comment on the long-term outlook.

Espoo, November 1, 2011

INNOFACTOR PLC

Board of Directors

Additional information:

CEO Sami Ensio, Innofactor Plc
Tel. +358 50 584 2029
sami.ensio@innofactor.com

Distribution:

NASDAQ OMX Helsinki
Main media
www.innofactor.com

Financial releases in 2012

The schedule for financial releases in 2012 will be published near the end of
2011.

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