Annual Report 2018
Report by the Board of Directors
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Research and Development

Bittium continued significant investments in its own products and product platforms. In January–December 2018 the investments were 34.4 percent of net sales.

The investments focused mainly on expanding the tactical communication product portfolio targeted to defense industry and on the development of different terminal products and their related software targeted for Mobile Security and Public Safety markets. In 2017, Bittium started to develop new software-defined radio based Bittium Tough SDR product family that includes tactical Bittium Tough SDR handheld and Bittium Tough SDR vehicle radios. In addition, Bittium continued to develop secure smartphones and the related security software. The investments were also continued into the further development of the products intended for measuring and monitoring of biosignals.

A significant part of the capitalized R&D investments is related to developing tactical communication handheld and vehicle radios and investments related to the further development of the secure smartphones and the related security software, as well as from the investments related to the further development of products intended for biosignal measuring and monitoring.

The depreciation plan of the capitalized R&D investments has been updated starting from November 2017 onwards. The depreciations are now made based on time. Previously part of the investments was depreciated based on the forecasted production amounts of the capitalized R&D asset. The update improves the allocation of the depreciations for the periods under review. The update of the depreciation plan has no effect on the evaluation of comparative periods.

 

R&D investments, MEUR  2018
12 months
2017
12 months
Total R&D investments 21.6 15.0
Capitalized R&D investments -15.1 -5.8
Depreciations and impairment of R&D investments 0.4 0.3
Cost impact on income statement 6.9 9.6
R&D investments, % of net sales 34.4 29.1%

 

Capitalized R&D investments in balance sheet, MEUR  2018
12 months
2017
12 months
Balance sheet value in the beginning of the period 11.9 6.4
Additions during the period 15.1 5.8
Acquisitions of the business    
Depreciations and impairment of R&D investments -0.4 -0.3
Balance sheet value at the end of the period 26.6 11.9