Skandia GreenPower AS

Earnings Release • Apr 27, 2023

Skandia Greenpower: Results for the fourth quarter and full-year 2022

Skandia Greenpower: Results for the fourth quarter and full-year 2022

Significant impairments and new strategic direction

Kristiansand 27th April 2023; Skandia Greenpower has released the annual report for 2022 and reports a net loss of NOK -127,7 million for the full year. The loss is mainly driven by significant impairments of the digital platform as well as impairment of customer acquisition cost (CAC). Total impairments of 59,5 million. The new Board of Directors have executed a cost-saving programme that aim to reduce the operating cost by 62 million.

Key events in 2022:

Elkompis successfully launched in third quarter

New CEO appointed 1st July 2022

Skandia Energi: hold-strategy continued amids market turbulence

Company in a distressed situation and search for funding initiated

Significant impairments of Elkompis and customer acquisition cost (CAC)

Subsequent events 2023:

CEO resigned in January 2023

Private placement concluded in February 2023

New BoD and new CEO in February and April, respectively

Cost-saving programme executed, leading to significant downscaling of the organisation

Full year 2022:

Skandia Greenpower (‘The Group’) are reporting a operating result (EBIT) of NOK -112,8 million for 2022 (NOK -24,0 million in 2021). The result were mainly driven by significant impairments of as well as higher operating cost.

Although higher power prices increased the Gross revenues to a record-high NOK 551,5 million in 2022 (NOK 335,6 million in 2021), Net revenues decreased to NOK 31,1 million (NOK 36,5 million) following a decrease in the customer base and reduced contribution margin per customer.

At year-end, the Group has 19.400 customers in the Skandia Energi portfolio and 4.300 in the Elkompis portfolio. The corresponding figures as of year-end 2021 were 31.000 and 0.

The Groups operating cost rose to NOK 143,3 million in 2022 (NOK 60,5 million) on the back of impairments of NOK 59,5 million as well as a significant increase in other operating cost due to higher salary cost, higher losses from accounts receivable and substantially increased marketing and operating cost related to the Elkompis platform.

The Group has impaired the Elkompis platform by NOK 49,5 million, leading to a residual book value of NOK 6,0 million. Revised investment analysis show that the expected future revenue from the platform is significantly lower than previously expected, leading to an impairment of 87 % of the invested amount. Further, the book value of CAC has been impaired by NOK 10,0 million as expected future contribution margin from customers is substantially lower than previously expected.

Following income taxes of NOK -16,2 million (NOK 5,1 million), the net result for 2022 ended at NOK -127,7 million – NOK 109,6 million lower than in 2021.

«The execution of the companys cost-saving programme is on track. New commercial strategies for the digital platform, and a significant potential for increased market interest, represents an upside for the platform.

In addition, we see that the the end-user market is evolving. A more agile and dynamic organisation will be able to adapt quickly and seize opportunities in the future. I believe it is realistic to achieve positive results in 2024

» says CEO Tommie Rudi

Fourth quarter 2022

The Group reports a operating result (EBIT) of NOK -81,8 million for the fourth quarter 2022 (NOK -9,1 million). The key drivers for the result were mainly the same as for the full year:

Net revenue of NOK 5,5 million (10,6 million)

Down due to less customers and lower contribution margin per customer

Operating cost of NOK 87,2 million (19,7 million)

Increase mainly due to impairments recognised as well as increased marketing cost and losses on accounts receivables

Subsequent events 2023:

Following a turbulent period, the company concluded a private placement in February 2023 and a new Board of Directors were elected. Subsequently, a cost-saving programme were initiated. The aim of the programme is to ensure cash positive operations in the second half of 2023 in order to secure the Groups going concern.

«The substantial impairments made in 2022 reflects that the previous strategy has led to significant losses for the shareholders of Skandia Greenpower. The new Board of Directors, elected in February 2023, has set out a strategic change for the company and are taking measures that will facilitate for future profitability.» says Odd Henning Dypvik, Chair of the Board.

For further information, please contact:

Odd Henning Dypvik

Chair of the Board

e-mail: odd.dypvik@gmail.com

Phone: +47 901 24 231