UPDATE 1-F-Secure profit gains on security software demand

Thu Oct 25, 2012 3:54am EDT

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By Tarmo Virki

HELSINKI, Oct 25 (Reuters) - Finnish software group F-Secure Oyj reported stronger-than-expected third quarter profits on Thursday as demand rose for its computer-protecting software.

The company cautioned, however, that the economic slowdown could hurt growth in coming quarters.

F-Secure said third-quarter operating profit rose 25 percent to 8.6 million euros ($11 million), beating all forecasts in a Reuters poll, while sales grew 7 percent to 39.1 million euros to meet forecasts.

Shares in F-Secure - which are down 12 percent this year as investments into building up its data storage Content Cloud unit have weighed on profits - rose 1.8 percent to 1.76 euros.

"Due to the global financial uncertainty we are facing some slowness in decision making, especially in the Content Cloud business," chief executive Christian Fredrikson said in a statement.

"This leads to longer sales cycles, and revenue growth in the coming quarters is expected to remain at a modest level."

The company also said it would halt development of an old product at its data storage unit and cut up to 50 jobs at its French unit, booking up to 2 million euros of charges in the fourth quarter.

F-Secure - which competes with larger rivals Symantec and Intel's McAfee - said it sees 2012 annual sales growth of 5-10 percent and operating profit margin, excluding one-offs, around 15 percent.

Overnight, Symantec reported results ahead of Wall Street expectations as its new chief executive took direct control of the company's sales force to turn the firm around.

($1 = 0.7711 euros) (Reporting By Tarmo Virki; Editing by Ritsuko Ando and Hans-Juergen Peters)

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