Norman ASA, the Norwegian data security company, posted a 9 per cent revenue growth in 2006 and preliminary result before tax of NOK 36.4 million (up 5 per cent from 2005). Profit margins for 2006 were strong and at the same level as the year before, with an EBITDA margin of 16 per cent. EBITDA for 2006 came in at NOK 39.6 million (2005: NOK 37.4 million). Operations generated a net cash flow of NOK 41.7 million, compared to NOK 23.0 million the previous year.

Net revenues for the year were NOK 252.4 million (2005: NOK 231.2 million). Throughout 2006 Norman implemented a series of refocusing initiatives. The preliminary results demonstrate that the company maintained strong growth and profitability while undergoing substantial strategic changes. Norman benefited from a substantially improved cash flow in 2006.

Norman’s net revenues for the fourth quarter increased by 4 per cent to NOK 65.2 million, compared to NOK 62.5 million in the same period the previous year. Norman ended the quarter with an EBITDA of NOK 9.1 million (2005: NOK 10.0 million), corresponding to an EBITDA margin of 14 per cent. Traditionally, the fourth quarter is not Norman’s strongest in terms of revenue growth and profits. The reduced growth rate and EBITDA margin in the fourth quarter of 2006 are partly due to seasonality, but also reflects the reorientation of the company with considerable investments starting from second half of 2006.

The strategic focus areas for Norman in 2006 have resulted in the following: 

• Norway: The negative trend in Norman’s home market is reversed, a basis for future growth in Norway is set. 
• Product: Norman’s product development efforts have become more targeted and powerful through increased investments in cutting edge technology (Norman SandBox and Norman Network Protection). 
• Technology sale: Strategic presence in California is established and several important contracts have been signed.

The market for data security products and services is changing constantly, which creates new opportunities for Norman. While the number of malware attacks is on the increase, major outbreaks of single new viruses causing worldwide alarm have become rare. Computer criminals now seem to aim for financial gain by attacking in a targeted way key infrastructures and major organizations rather than creating disturbance for a large number of users.

Traditional antivirus technology continues to be an attractive and a promising growth market also in the future. However, the new development towards more sophisticated attacks requires a new breed of technology to analyze and prevent targeted attacks towards large enterprises and critical infrastructures. Norman has developed a family of advanced malware analyzing tools for this purpose. Norman’s SandBox is a proven world class technology in the field of scanning huge amounts of data. Suspicious files are executed in an emulated environment where they cannot do any harm to the infrastructure. In 2006, ten major organizations, national security organizations and major corporations, ran trials with the company’s new, advanced Norman SandBox analyzer products. Seven of them have already signed contracts to use Norman for protecting their infrastructure and analyzing malware trends. A large number of new prospects have since entered into trials.

Going forward, Norman will continue to grow in its traditional markets as well as pursuing the new opportunities created by the development in the data security sector.

Norman’s financial position remains strong. The company has no interest bearing debt and enjoys a positive cash flow, as described above. Total cash at year-end was NOK 78 million. The company purchased own shares amounting to NOK 40 million in 2006. The company will continue to return capital to shareholders by share buy-back program and dividend policy. At the end of 2006, Norman had tax loss carry-forwards of NOK 130 million.

The company had 191 employees at the end of 2006 (183 at the end of 2005).

Norman expects a continuing growth and profitability also in 2007. The company will benefit from the refocusing and investments made in 2006 and will continue to invest in both product development and the new business areas in 2007.

Enclosed is a summary of the interim financial statements for the fourth quarter 2006.

For further information, please contact Chairman of the board Svein Ramsay Goli (+47 9075 6757) or CEO Trygve Aasland (+ 47 6710 9717 or +47 4153 9717).