Thank you very much, moderator, and thank you everyone for listening to this call. As said, my name is Jan Häglund. I'm the CEO of Enea, and I'm joined in this call by Ola Burmark, our CFO. We will be going through the key events and results, financial results for the second quarter and the period January to June 2022. On the third page, we summarize our financial results for the quarter. Net sales came in at SEK 217 million, which is a 9% increase year-over-year or 3%, currency adjusted. Our operating profit was SEK 28 million adjusted for non-recurring items corresponding to an operating margin of 13.1%.
Net debt was SEK 359 million, significantly down from the first quarter, thanks to a large extent to the proceeds from the divestment of our services business. Earnings per share came in at SEK 6.56 , also significantly positively impacted by the divestment, but the continued operation contributed SEK 2.15 in the quarter. Operating cash flow was SEK 73 million, also significantly up sequentially. We continue to invest a significant part of our revenues, 32.4% in the quarter of R&D investment, both expensed and capitalized in relation to our revenues.
We do that because of future opportunities and also due to some pretty large and heavy commitments where we have a fantastic position with leading operators to shape the industry, in particular in 4G and 5G data management networks. For the period, we are affected by a weaker first quarter. Net sales in total is SEK 427 million . Operating margin in total, adjusted for non-recurring items in 10.1%. Net debt, as stated before. Earnings per share for the period, SEK 6.19. Operating cash flow, SEK 77 million . On the next page, I'll summarize some of the key events in the quarter. Starting with the divestment of software development services business, which was completed in the second quarter.
It was signed in the first quarter, but we managed then to complete as planned in the second quarter. I'll come back to some of the details. We see in the second quarter that operators remain cautious with investments, and that has affected our network solution sales, in particular due to some delays in investment projects. We, however, see that these projects are carried forward and opportunities into the second half of the year. Of course, we continue to work on them with high energy. Our latest acquisition, which was done, I think, almost on the day one year ago, AdaptiveMobile Security, it continues to develop well. This acquisition has taken us into a completely new domain and market with fantastic competence in an area that is increasing in importance, in particular in cybersecurity for mobile networks.
We have variations between quarters, and as I mentioned, we've seen some delays in this quarter that have affected our sales. However, we have a strong underlying customer base. That customer base remains stable. It gives us strong recurring revenues from support and maintenance contracts and from royalties and licenses. For example, through our position as the leading vendor of traffic intelligence software. During the quarter, we have also changed our financial structure. We've taken financial initiatives and strengthened the balance sheet. This all provides resilience for us as a company, and Ola will be touching more on that going forward. As I mentioned before, we are proud provider in several data management projects based on a product called Stratum, where we are shaping industry, opening interfaces, and enabling for tier one operators to become digital telcos.
We've made significant progress in these projects during the quarter, and we are nearing commercial operation. Finally, we're also proud to announce a public reference in the area of mobile network security, the Digicel Group, where we, with our software and services, will be covering 26 markets in the Caribbean and Central America. I'll give some more details in the following slides. On slide five, summarizing the result of our divestment of our software development service business. This divestment is part of a long-term overall strategy to become focused as a specialist supplier on software products for telecom security. The divestment, which was closed on June 8th, was done at an enterprise value of EUR 17.9 million.
It does contain a holdback of EUR 1.7 million, which will cover the adjustments post-closing, and those adjustments we expect to be handled during the third quarter. However, during the second quarter, we see a significant contribution financially from this transaction. Some SEK 95 million of net profit then came into our results. If you look at the transformation that Enea has done, it's a pretty large change since the company was founded in 1968 and has been going through a number of phases specializing in IT consultancy and operating systems.
With the recent years focus on becoming a direct partner towards some of the largest service providers in the world, focusing on specialized software for telecom and cybersecurity, this transaction makes perfect sense because it gives us even more focus than other business models for software industry and cloud-native software. On the next page, summarizing the new public reference in mobile network security. Public reference are important for us because they show how we grow market share, and they provide references for future and other opportunities in the region and on the market. The Digicel Group is a group of many many networks, in some cases, small networks focused in the Caribbean and Central America. We will be providing our software and specialized services for signaling protection in less than 26 different networks across this region.
It's a five-year contract where our world-leading products, software products, in combination with unique competence that we sit on, that combination is a very strong combination because it in total gives the opportunity to filter out and prevent attacks, and intrusion attempts into the mobile networks. We see a very high attention on mobile network security, in particular in the Americas, and that's why this is a very important public reference for us. As mentioned before, AdaptiveMobile Security was acquired one year ago, and we step- by- step integrate the offering as well as the brand into Enea. During the quarter, we've taken an important brand integration step where we now call the offering Enea AdaptiveMobile Security towards the market, towards customers.
We'll do that to show a broader portfolio and to show our customers the wider customer base that Enea has and in total a stronger brand. On page seven, a quick summary of our progress in the area of data management. We are since several years a specialist supplier in data management, which is a critical part of mobile networks. We've taken some very innovative steps. Thanks to that, we are the provider of several tier one telecom operators in very large ongoing projects for 4G and 5G. The majority of operators, in fact, want to go in this direction. They want to go in the direction where they become digital, where they base their networks on cloud, and where they open up for networks with multi-vendor capabilities with some open interfaces. That's exactly what we provide.
We've made significant progress in these customer projects during the quarter. We're nearing now a stage where our software, together with the surrounding environment, is ready for a go-live and commercial stage. This is important for several reasons, not least because we see that these leading telecom operators will pave the way in demonstrating the commercial advantages of this new way of building completely software-based telecom networks. On page eight, we just summarize some of the publications we've done during the quarter. We're very proud to have very high competence in several of the areas where we work.
Thanks to that competence, we've been able not only to do product launches, we've done some important product launches, both in the area of Wi-Fi software as a service, as well as in general mode 5G networks. We've also published reports and white papers with thought leadership, innovation, new ideas that influence the market. As a provider of specialized software, we're really proud to have that position that we can and will influence the market towards new innovation, new opportunities, and more efficiency in the networks. With that, we move forward into the details of the financial results, and I invite Ola Burmark, our CFO, to give us those details. Go ahead, Ola.
Thank you. So, I would say despite all the positive events in the quarter, this has not fully materialized in sales yet. We are delivering a net sales increase versus last year of 9%. Thank you very much. Sorry for the interruption. We are now back into the call again. We move to page 11, where we'll dig a little bit deeper in network solutions. We had the sales in the quarter of SEK 185.7 million versus SEK 160 million last year, so it's a growth of 16%. The growth is very much contributed by the AdaptiveMobile Security. So the organic growth network solutions was negative by 19%. It is the license revenues that is mostly impacted or impacting the negative growth.
It was SEK 87 million in the quarter compared to SEK 100 million in the second quarter last year. This is where we see the delayed decision-makings from individual customers and individual investments, and that is not creating new license revenues. Here we see some postponements in the quarter. Referring to the achieved milestones in the data management project, we have also recognized SEK 29 million in license revenues in the quarter compared to SEK 9 million last year. There is a very healthy growth in support and maintenance, and this increases our base of recurring revenue. It is partly driven by the acquisition of AdaptiveMobile, but we all see the same trend in the rest of the network solution businesses.
Also, professional services are increasing as a part of the sales in network solutions, and this is mainly contributed by AdaptiveMobile Security and their expertise in threat intelligence services. Next slide, please. Operating system has declined for a long time, and it continues to decline in the same pace. In the quarter, we had sales of SEK 31 million compared to SEK 38 million same quarter last year. Organically and currency adjusted, this is negative growth of 18%. The two key accounts declined by 31% and stands for about 55%, 56% of the total sales in the quarter. Next, please. After divesting the services business, we now see that network solutions, i t has been a great part of our business for several quarters now, but it's now definitely the lion part.
It today stands for 86% of Enea's turnover, and this is of course where the focus is. While then the operating systems, as we know, will continue to decline as our customers go into open source codes instead. Further down in the P&L, we go into the EBITDA, where we report an EBITDA margin of 32.7% in the quarter. That represents an EBITDA of SEK 71 million. There are no non-recurring items in the quarter. There is a small difference there, but it's all related to currency translations. The margin is lower compared to the same period last year, and it's partly explained by the gross margin, which is then negatively affected by the lower license sales in the quarter.
In addition, the higher degree of services within the AdaptiveMobile Security, as we have been reported before. I would say in this quarter specifically, it has been, of course, the license sales with a high margin putting some pressure on the gross margin. If we look at the operating expenses, which were SEK 146 million in the quarter compared to SEK 116 million last year, partly or mainly this is, of course, explained by the acquisition. This was not part of last year figures, and we do also have unfavorable foreign exchange impact on the cost side. Net of all the above, we are not increasing operational spend. We're rather decreasing operational spend with about 3% compared to the same quarter last year. EBIT margin came in at 13.1%. We're on slide 15.
Or SEK 28 million compared to almost SEK 58 million the same period last year. As you see in the graph to the left, the rolling 12-month EBIT margin is around 20%, but definitely lower the last two quarters. As has been said before, earnings per share SEK 6.56 in the quarter compared to SEK 2.41 last year, very much driven by the divestment of the services business.
For the continued operations, we see an earnings per share of SEK 2.15 in the quarter compared to SEK 2.24 last year. Page 16. Early in the quarter, we did announce a new financing structure. This financing structure differs a bit from what we had before, and this now is more shifted to our quarterly variations in cash flows and earnings. In the quarter, we report cash flow before changes in working capital of almost SEK 80 million compared to SEK 88 million last year, where cash flow from operations amounted to SEK 73 million compared to SEK 94 million last year. All the proceeds from the divestments of the service businesses have been used to repay outstanding debt under the revolver facility.
Total interest-bearing bank loans at the end of the second quarter amounted to SEK 577 million, which is an increase versus last year of SEK 393 million. That increase is it's fully, I would say, explained by the acquisition of AdaptiveMobile Security, where we actually added debt of EUR 45 million. Adjusting for that, we are definitely gearing down the company. We also had SEK 280 million in cash and cash equivalents in the quarter, and those together then sum up to the net debt of SEK 359 million explained in the beginning of the call. Equity ratio has, of course, improved over the quarter. We now report almost 66%, and the net debt to EBITDA ratio is 1.2. Thank you.
Thank you very much, Ola. Let me at the end here talk about the way forward and the outlook. Summarizing first on page 18, some of the key factors and trends affecting our industry. I mean, we are very active in two areas, telecom and cybersecurity, two interesting and very good markets to be in. In telecom, traffic growth continues year- over- year- over- year. We also see new applications coming into the network requiring higher network performance. This gives us comfort that over time, upgrades are necessary and will be necessary to mobile network infrastructure across the world. We also see an underlying trend of digital telcos, where operators are step-by-step basing their networks on software, they're basing them on cloud, and they're enabling multi-vendor kind of app store network architectures. This is good for us as a software specialist. Cybersecurity.
Well, I don't think it's news to anyone how important this is. We see almost every day how geopolitical tensions increase and how cyberattacks are a consequence of these geopolitical tensions. Now, mobile networks in particular, which is the area where we are active, they are strategic. They're strategic for people, for enterprises, and for nations. Therefore, they are potential targets. Sometimes we see news of mobile networks attacks, causing significant disturbances in society. In some cases, we don't see the news because they are not public, but they're happening all the time. This is our focus area to help and prevent, in particular, the signaling and messaging attacks on mobile infrastructure. We see high attention across the world, in particular, you can say in the Americas, but there are activities in all markets across the world.
You may say that Europe, due to the fragmented nature of European telecom industry, is a bit slower and more complex to react to these threats. Now, we, like everyone, also see a challenging market and macro environment. We have seen, as reported now in the quarter, that this is causing more cautious decision-making and deferred investments. We're prepared for that, and that's also why we ramped up some of our go-to-market activities. We've also seen on the margin that component shortages are impacting hardware supply. Now, we are not providing hardware, but some of our customers are. And since our software is embedded, it does affect some of our royalty revenues in some areas. However, on page nineteen, our strategy stands firm.
We're confident in our position as a specialized software provider with a high-margin portfolio in a world where many of our competitors are still encumbered by legacy hardware business. We're also confident in the choice we've made of growth markets, cybersecurity, the 5G core networks, and the Internet of Things. We are confident also, but growing our global presence. We build our business both through direct and indirect go-to-market. We build our development through a distributed R&D force, leveraging competence across the globe. Coming back to go-to-market, this is an area of focus for us, and we are taking steps to increase the presence with key customers. We are in fact onboarding and hiring people. As late as yesterday, we actually onboarded a new head of sales for our telecoms business.
We are with that pretty confident that we're building a base for further sequential improvements in our business during the year. On the last page, for the outlook of 2022, we retain our long-term target of sales growth and an operating profit above 21%. As mentioned, we have an uncertain macro environment, and we have had a weak first half of the year. That means that we still judge, as we did in the first quarter, that it will be challenging to reach the profitability target for 2022. With that, I thank you for listening and give it back to the operator if there are any questions.
We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your headset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star followed by two. At this moment, we will pause momentarily to assemble our roster. The first question comes from Jesper von Koch from Redeye. Please go ahead.
Good morning, guys. Hope you're well. Let's start with the OpEx level. I know that you said that that's heightened during the quarter due to FX effect. Would you say that the current OpEx in Q2 is considered like a normal level?
Yeah, I would say that is the normal level. That is the level we are geared for in order to deliver upon those transformative projects within data management, which are taking resources currently, and also to continue to have an attractive product portfolio, where we need to rather invest further, which as Jan has said, is in our go-to-market capabilities.
The new investments that are being made within sales and marketing that is included in that kind of OpEx level?
No, they are not. I would say we are not aiming to grow the OpEx level overall, but we are aiming to rebalance over time in order to have to keep that intact.
Okay. So that I understand it correctly, isn't it currently you're putting a lot of resources into the product execution, and once that product execution is kind of finished, those will be put more into sales and marketing. Is that correct?
That is correct. That is very much correct, Jesper. The business is not digital, so it's not that one cost go out one day, another added the second day. But you are totally right. Currently, we are heavily using resources on those transformative projects. Over time, they are getting commercialized, as Jan was saying today. We then will rather need to invest more in the sales and marketing. This will not be happening at the same time. It will rather be, you know, we are now investing in sales and marketing. As we see, we can rebalance that over time.
Okay, good. Let's move into the large data management order received in 2020, of which you completed one milestone in the quarter, from which you received SEK 29 million. Could you say anything about how much that remains from that order and how much you expect to receive a milestone, milestones during H2?
We don't give overall the outlooks going forward on the milestone execution of these projects. Just to repeat for everyone that in 2020, we closed two significant deals. One at the value of about EUR 20 million and the other one at a value of about $17 million. We have different revenue recognition models because of different business models. One is very much milestone oriented, and the other one is more oriented towards the subscriber growth. That one is much more back-end heavy when it comes to a revenue recognition. The vast majority of revenue in that contract still remains.
Okay. Good.
Depends on the plans of the customer, which we're only in part affecting. It's very difficult to give an outlook for those revenues at this time.
My last one about your increased efforts on sales and marketing. Could you try to be a little bit more specific about your plan, and perhaps also when do you expect to see any kind of impact on that?
This is a step-by-step that has been ongoing for a while. We have onboarded already a few key people to manage our overall sales operations. We have onboarded key people towards some of our bigger accounts, and we have further plans to target. This is not about a large number of people, but it's rather about select key people. We have a new chief marketing officer since the first quarter this year. As I mentioned, we also onboarded a senior sales leader. In fact, we'll onboard from the first quarter that was announced yesterday. It's a step-by-step plan where we bring in some very experienced key people.
Our expectation is that this will further strengthen our go-to-market activities, which is important since our business is more and more dependent on direct sales. I mean, as mentioned before, we come from a situation where we very much have been a sub-supplier in the past, and now we have a position up there with leading customers, where we have a direct relation. In that situation, you need to have the kind of key competence and enough people to take those sales dialogues forward.
Okay. Mainly still toward existing key accounts from which you expect to have some like cross-selling with different kind of products, if that's correct.
Yeah, it's a good point that I should mention that too. That we have, through our acquisitions, we've also brought in sales forces and sales groups that before have been specialized on only one part, only perhaps one product or only a part of the portfolio. What we've done during the year, starting in the beginning of the year, we started to pull these groups together so that one person can sell a broader portfolio. That increases our reach. We're taking further steps now as of the third quarter, where we are in fact integrating also the AdaptiveMobile Security sales force. Step-by-step, we're using all the sales people, all the customer contacts we have in order to offer a broader portfolio and present a larger brand. That's a significant part of our strategy.
We do it step-by-step in order to provide continuity both for customers and for employees.
Great. Thanks so much and good luck going forward. Thank you.
The next question comes from Frank Maaø from DNB Markets. Please go ahead.
Yes. Hi, good morning, gentlemen. My questions, well, I basically got three questions at the moment, and they are mostly relating to the commercial traction that you see and the project execution. You talked about deferred investments and project delays again. My question is really to what extent is this based on more generic inferences about the news flow that we see about inflation and macro environment and so on, versus more specific feedback perhaps from your customers that they are actually making deliberate slowdown decisions at the moment? If you see what I mean. Just want to get a grip on how specific this impact or this feedback is and what it's based on.
Yeah, thank you. Thank you, Frank. No, you bring up a number of important points here. Of course, the macro environment is changing and has changed significantly during the first half of this year. There are several factors that we all can read about in the newspapers, and some of those have a direct impact. For example, financing costs with customers and some are more indirect when it comes to sort of uncertainty and perhaps a more cautious business climate. It's difficult for us, I think, to have an overall view and to have a sort of view of exactly how these different factors are contributing.
What we can say is that we've seen that decision-making has been on the margin a bit slower, that evaluations in particular to prove the value of some of the new investments are more cautious and more careful. It doesn't mean that opportunities go away for us because we're pretty confident that what we do actually adds significant value. For example, we optimize networks where we get more value out of the current infrastructure, so you can actually handle more traffic with less investment. However, that is to be proven, and some of those projects are taking longer time because of a more cautious investment environment, both on the technical side and on the procurement side of our customers. Again, I want to stress that we carry these opportunities forward.
We're confident with our position, and we still believe that we're well-positioned in a world of digital telcos, 4G traffic, and 5G networks being introduced.
I see. A quick follow-up. You don't see that you've actually lost any opportunities recently, for instance, through and project decisions going in favor of competitors. It's more like the technical and procurement procedures take more time in the current environment. Is that correct?
Yes, that's correct. This is primarily delayed and deferred projects and opportunities. We have not lost any significant deals. On the contrary, we see a pretty strong list of opportunities, and it's more a question of how quickly we can convert them.
What I would like to add to that also with sort of the one proof point in the figures that where we see the deviations in sales, it is in new license sales, where we see actually continuous growth in the underlying sort of recurring revenues with stable support and maintenance revenues. That we're not losing any contracts or any sort of current business. It is rather the postponements and delays in new deals.
Just to continue a little bit on that topic, do you feel that customers are increasingly taking more time also to evaluate different technical roads to the new cloud-native reality? You know what I mean? For instance, whether or not they should actually be in the public cloud or more private or hybrid cloud environments for the newer technical stacks for the new next generation solutions.
I think it's clear that some of the new technology, for example, best-of-breed technology, where you have many different applications running in the cloud environment, requires integration. Although there are open standards, interoperability between vendors needs to be proven. In fact, we see that customers put very high priority on interoperability. In many cases, interoperability has been taking longer time to achieve. We are involved in a couple of those projects. It's not just about proving it in lab environments. You need to prove it to the full extent in commercial environments together with an ecosystem of other vendors. Yes, I think new technology has been taking a little bit longer time than anticipated in the beginning. That comes with cloud technology and a higher degree of multi-vendor.
I believe that has been reported also by some of our competitors in the industry. That's why it's so important for us that we are part of some of those spearheading projects where interoperability will be proven and will be happening. That's also why it's so important that we're getting closer to commercialization of these new ways of building digital and mobile networks.
I see. Thank you. Well, a final question really is relating to your previous target of SEK 1.5 billion revenue, which was set in a situation where you've actually had three business areas. Now we have divested one of them, and I would expect that to be updated at some point. Do you have any commentary on what you expect will happen in relation to that target, when you will update that?
Yes, you're right, Frank, that the divestment of our services business by itself necessitates that we review the financial targets. We are doing that, and we will be doing that. What we say in the report is that the result of that review will be communicated after the fourth quarter this year.
Also Q4. Okay. Thank you.
Thank you.
As a reminder, if you wish to register for a question, please press star followed by one. Gentlemen, so far, there are no more questions.
Thank you very much, moderator. We thank everyone for listening in to the call. We look forward to further contacts with you. Thank you very much.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines. Goodbye.