Lysaker, 26^th October 1999  

The Norman Group had net revenues of NOK 49.6 million in the 3^rd quarter 1999. This represents an increase of 42% in net revenues on the 3^rd quarter 1998, which included a one-off contract sale of NOK 2.6 million. The loss before tax of NOK 1 million and the operating loss of NOK 2.8 million for the 3^rd quarter 1999 are a substantial improvement on the same period in 1998 when the loss before tax was NOK 15.2 million and the operating loss was NOK 9.8 million. Cashflow from on-going operations for 1999 to date was NOK 4.2 million to date, before working capital adjustments.

In the 3^rd quarter 1999, the focus has been to maintain the growth in revenue compared to previous years, as well as to build the distribution of Norman’s products in new markets. The latter has resulted in distribution agreements with SecurAX, a company in the Al Batha Group, in the United Arab Emirates, and AEC Ltd, in the Czech Republic. Both of these distributors are in markets that are experiencing a rapid growth in IT investment, and are therefore of strategic importance for Norman.

In this period it has also been necessary to change management and restructure Norman’s operations in the UK. Costs are now under control and we are beginning to see a steady stream of income from Wick Hill plc, of our main distributors in the UK market.

The Norwegian operations, including Ibas, have had a very encouraging quarter with revenue growth of 40% compared to the same period in 1998. Norman’s international sales subsidiaries have shown steady growth and results in the period, and Norman’s export share of total net revenues now exceeds 60%.

During the course of the 3^rd quarter, Norman was awarded yet another "100% award" from Virus Bulletin, and is still one of only two companies in the world that has been awarded the most "100% awards" over time - a demonstration of Norman’s leading technology in identifying and repairing viruses.

The priorities for the next quarter will be to continue to build the infrastructure to support Norman’s growth strategy via partners. Further attention will also be given to R&D to maintain the technologically leading edge products within the data security market segments that Norman has chosen to exploit.

The board and company management are convinced that the company’s positive trend will also continue in the forthcoming quarter. Although the company has not yet experienced any marked "year 2000-effect", Norman could also be influenced by market uncertainties as the year end approaches.

Enclosed is a summary of the preliminary financial statements for the 3^rd quarter 1999.

For further information, please contact Svein Ramsay Goli, Chairman of the Board of Norman ASA or Bjørn Fosli, President and CEO of Norman ASA, tel +47 67109700/ www.norman.no

Norman is one of the world’s leading companies within the field of computer security. With products for virus control, access control, encryption, network security and data recovery, the company plays an important role in the data industry. Norman’s products have more than 12 million users. Norman has approximately 220 employees and is represented by subsidiaries and strategic alliances in USA, Europe, Asia and Australia. The company is headquarted at Lysaker outside Oslo, Norway.

Consolidated income statement

Analysis of net financial items

Analysis of research & development costs included in total operating expenses

Notes to the consolidated financial statements

1. Figures for 1998 have been restated and reclassified in accordance with the new Norwegian Accounting Law effective from 1^st January 1999. There were no material adjustments to the 1998 figures arising from the implementation of the new Norwegian Accounting Law.
2. Norman management have changed the accounting estimate for deferred revenue on net invoiced sales with effect from 1^st July 1999 in order to more correctly reflect the financial obligations associated with the sale of support and update contracts. For accounting purposes, this has been treated as a change in estimate and accordingly, the comparative figures have not been restated.
3. The increase in bad debt expenses is mainly the result of writing off the remaining receivable balance on the 1998 contract with SCM, where legal proceedings in the US are pending.
4. Results from SHARK BV and ESaSS BV, Netherlands, and Norman Data Defense Systems AB, Sweden, have been consolidated from 1 March 1998, 1 April 1998 and 1 August 1998 respectively

Consolidated balance sheets

Lysaker, 26^th October 1999 The Board of Directors of Norman ASA Svein Ramsay Goli Chairman