News

Strong Growth Continues

SSH Communications Security Group (SSH) experienced a continuous strong growth throughout the 1999 fiscal period, which differed from previous years in that its duration was only nine calendar months. The first day of the Group's fiscal period was moved from the beginning of April to the beginning of January. The turnover of the Group increased by 246% during the nine months of the fiscal period, over that of the previous 12 month fiscal period, totaling Euro 5,477,613 by the end of the year. This growth was primarily due to the success of products based on the Group's IPsec technology. The turnover growth was evenly divided over the entire reference period. In the years to come the partnership contracts signed should result in considerable royalty and maintenance revenues. Over 90% of the Group's turnover was accrued from the licensing of in-house products. Of these revenues, approximately half were earned on North American markets. During the fiscal period, SSH further reinforced its position as a leading provider of IPsec technology for the Internet equipment manufacturers and information security enterprises.
In December of 1999 the Group issued stock to 26 institutional investors. The stock issue increased the Group's capital by Euro 13,4 million. The growth and the internationalization of the Group will require considerable financial investments in the near future. Efforts to assure the adequacy of the capital will be made by financing schemes. After the stock issue, the number of the Group's shares was 22,710,000 in total.

In spite of the growth and investments in product development made last fiscal period, it was indeed a profitable year. Profits before taxes were approximately 26.4% of the turnover. After taxes, the final result of the profits for the fiscal period was Euro 1,066,325. This result was five times greater than that of the previous year.

The extremely strong growth of SSH's sales is expected to continue for the duration of 2000. The new products such as SSH Certifier and various versions of SSH Secure Shell product line provide new revenue sources for the Group. A significant increase in the turnover of other products is also anticipated.

The outlook for the Internet information security software markets is exceptionally good. A strong growth in the volume is expected for the entire industry.

During the fiscal period, the Group's board of directors consisted of board chairman Tatu Ylönen and board members Arto Karila, George Adams, Martti M. Kaila, and Vesa Sorasahi.

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