Volue ASA

VOLUE ASA - 549300WCI347SOTFJB71 - 2022 549300WCI347SOTFJB71 2021-01-01 2021-12-31 549300WCI347SOTFJB71 2020-01-01 2020-12-31 549300WCI347SOTFJB71 2021-12-31 549300WCI347SOTFJB71 2020-12-31 549300WCI347SOTFJB71 2021-01-01 2021-12-31 volu:ShareCapitalAndSharePremiumMember 549300WCI347SOTFJB71 2021-01-01 2021-12-31 ifrs-full:TreasurySharesMember 549300WCI347SOTFJB71 2021-01-01 2021-12-31 ifrs-full:OtherReservesMember 549300WCI347SOTFJB71 2021-01-01 2021-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 549300WCI347SOTFJB71 2021-01-01 2021-12-31 ifrs-full:NoncontrollingInterestsMember 549300WCI347SOTFJB71 2020-12-31 ifrs-full:TreasurySharesMember 549300WCI347SOTFJB71 2020-12-31 ifrs-full:NoncontrollingInterestsMember 549300WCI347SOTFJB71 2021-12-31 volu:ShareCapitalAndSharePremiumMember 549300WCI347SOTFJB71 2021-12-31 ifrs-full:TreasurySharesMember 549300WCI347SOTFJB71 2021-12-31 ifrs-full:OtherReservesMember 549300WCI347SOTFJB71 2021-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 549300WCI347SOTFJB71 2020-01-01 2020-12-31 volu:ShareCapitalAndSharePremiumMember 549300WCI347SOTFJB71 2020-01-01 2020-12-31 ifrs-full:TreasurySharesMember 549300WCI347SOTFJB71 2020-01-01 2020-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 549300WCI347SOTFJB71 2020-01-01 2020-12-31 ifrs-full:OtherReservesMember 549300WCI347SOTFJB71 2020-01-01 2020-12-31 ifrs-full:NoncontrollingInterestsMember 549300WCI347SOTFJB71 2019-12-31 volu:ShareCapitalAndSharePremiumMember 549300WCI347SOTFJB71 2019-12-31 ifrs-full:TreasurySharesMember 549300WCI347SOTFJB71 2019-12-31 ifrs-full:OtherReservesMember 549300WCI347SOTFJB71 2019-12-31 ifrs-full:EquityAttributableToOwnersOfParentMember 549300WCI347SOTFJB71 2019-12-31 ifrs-full:NoncontrollingInterestsMember 549300WCI347SOTFJB71 2020-12-31 volu:ShareCapitalAndSharePremiumMember 549300WCI347SOTFJB71 2019-12-31 549300WCI347SOTFJB71 2021-12-31 ifrs-full:NoncontrollingInterestsMember 549300WCI347SOTFJB71 2020-12-31 ifrs-full:OtherReservesMember 549300WCI347SOTFJB71 2020-12-31 ifrs-full:EquityAttributableToOwnersOfParentMemberiso4217:NOK iso4217:NOKxbrli:shares Technology for a sustainable tomorrow Annual report 2021 Contents Volue in brief 3 Letter from the CEO 6 Board of Directors’ report 9 Consolidated financial statements 18 Parent company financial statements 56 Independent auditor’s report 71 Members of the Board 74 Alternative Performance Measures 78 3 Annual Report 2021 Volue in brief Volue in brief Volue was established in March 2020 as the result of the merger of four companies: Powel, Markedskraft, Scanmatic and Wasight. The company transferred listing from Euronext Growth to Oslo Stock Exchange in May 2021. Volue is a market leader in technologies and services that power the green transition. Based on 50 years of experience, Volue provides innovative solutions, systems and insights to industries critical to society. Over 700 employees work with more than 2,200 customers across energy, power grid, water and infrastructure projects that ensure a sustainable, flexible and robust future. The company is headquartered in Oslo, Norway and active in 40+ countries. Volue operates in industry segments that offer critical infrastructure to society, including energy, water supply and infrastructure building. In addition, Volue delivers instrumentation and automation for transport, offshore, maritime and defence purposes. Volue is operating through three industry segments; Energy, Power Grid and Infrastructure, with eight product lines: Optimisation, Trading, Insight, Market Services, Power Grid, Industrial IoT, Water and Construction. Volue’s digital platforms and innovative solutions support digital water management and the automation of processes and machines for the construction industry. Our software suite, built on deep domain knowledge, enables customers across the clean energy value chain to provide services critical to society flexibly, reliably and efficiently, thereby accelerating the green energy transition. Purpose We realise the green transition Vision To develop technology for a sustainable tomorrow Mission To build a global technology leader who provides innovative services ciritcal to society, unlocking a cleaner, better and more profitable future 4 Annual Report 2021 Volue in brief Volue by numbers 700+ EMPLOYEES 2 200+ CUSTOMERS IN 40+ COUNTRIES 30+ OFFICES IN 8 COUNTRIES Where we are: Volue’s HQ Volue’s offices Countries where Volue has customers 5 Highlights 2021 • Operating revenues of NOK 1,039 million, 17% overall growth • Adjusted EBITDA of NOK 214 million with margin of 21% • Solid performance in ARR business, with steady growth in new SaaS business • 17% growth in ARR from 2020 • Strong sales performance, more than 3,200 deals closed in 2021 • Expanded international activities and European footprint • Acquistion of ProCom and successful integration of ProCom and Likron • Building back better after cyber incident, cyber insurance settlement of NOK 20 million • On track for 2025 ambitions - increasing revenues target to exceed NOK 2 billion Key ﬁgures Amounts in NOK million and per cent 2021 2020 Operating revenues 1,039 892 Adjusted EBITDA 214 197 Adjusted EBITDA margin (%) 21% 22% EBITDA 138 148 Operating profit 45 82 Ordinary profit for continued operations 28 60 Operating cash flow 138 230 NIBD -382 -432 Equity 767 743 Equity ratio (%) 44% 50% Annual Report 2021 Volue in brief 6 Annual Report 2021 Leer from the CEO Leer from the CEO I am very proud that we met our bold ambitions for 2021. We exceeded our operating revenue goal of NOK 1 billion – our revenues grew by 17% to NOK 1,039 million, and we reported a 21% adjusted EBITDA. Out of the total revenues, 64% were recurring revenues, accounting for 17% growth. In April, Euronext approved Volue for admission to trading on the Oslo Stock Exchange, which meant that we could also tick off another one of our 2021 goals. At the end of 2021, we completed the acquisition and successful integration of the German company ProCom, adding three million euros in annual recurring revenues, approximately 60 employees, and new customers to our business. Position of strength in a strong market I am very proud of what our company and people achieved in 2021. I am impressed and humbled by what the Volue team has been able to achieve this past year. Every day our employees rise to the challenge of building technology for a sustainable tomorrow. The market remains strong and attractive, and we believe that the integration of ProCom and Likron (acquired at the end of 2020) will cement our 2021 was a strong year for Volue. Despite the diﬃculties created by the ongoing pandemic, we dedicated our eﬀorts to serving our customers and invested in proﬁtable growth, expanding Volue’s footprint in Europe and beyond. position as the leading technology provider for the European energy industry, offering products and services along the entire clean energy value chain. Today, 40% of the market participants across the European exchanges are our customers. Overall, we have more than 2,200 customers, and in 2021 we closed more than 3,200 deals. These include a number of strategic contracts. We celebrated the new year with a breakthrough contract signed in December with the largest renewable energy company in Spain, a great achievement for our efforts in Iberia. At the same time, we delivered on our market expansion strategy by opening an office in Tokyo, Japan. In addition, Volue will continue to explore business opportunities outside the European region. Technology for a sustainable tomorrow 2021 was defined not only by the world’s response to the ongoing pandemic but also to the looming climate crisis. Climate change now poses a major threat to our world, and global warming impacts everyone. Only collaboration and dedicated efforts will help us achieve the change we need, and at Volue, we are set to take our part of this shared responsibility. Last year, Volue presented its first ESG report, describing our sustainability efforts within four main areas: Environment, Great Place to Work, Ethical Business Conduct, and Reliable Products and Operations. This year, we have built on our ESG commitments by working with dedication on these sustainability areas and have set new bold targets for 2022. To aid us on our sustainability journey, we have looked to proven sustainability frameworks that could help us keep our strategic focus and create greater impact. In 2021, Volue became a signatory of the UN Global Compact, the world’s largest corporate initiative for sustainability, and this year we are also reporting according to the GRI standards for the first time. I encourage you to take a look at Volue’s ESG report for 2021. The Volue Platform At the core of our value-offering is our platform. We measure success by how the platform is utilised by our customers. With more than 30 billion automated calculations in the cloud, we execute over 25 million trades every year on behalf of our customers. 7 Our market insight service for power professionals holds 150,000 price curves, accessed 650 billion times annually. Our sensor platform collects 120 trillion data points from our 4,500 installations. These numbers increase every year, and this is how we retain 99% of our customers. Industry developments The power industry has been widely recognised as stable, predictable and conservative for a century, and today’s volatility in the power markets represents a paradigm change. We find ourselves in a world ever more dependent on electricity. As we close down coal and nuclear power plants to deliver on our sustainability goals, we count more and more on new energy sources – the largely weather-dependent solar and wind assets. At the same time, gas prices are skyrocketing as geopolitical challenges lead to a shortage of supply. In many ways, our end markets are experiencing what we think is the perfect storm. A storm that is projected to last for decades. In this, we see risks but also tremendous opportunities. To manage the green transition, our customers are asking us for wall-to-wall digitalisation across processes and disciplines. In the Energy segment, we’ve worked to expand our platform into solar, wind, batteries, and more. This Annual Report 2021 Leer from the CEO is important to our customers, as they continue to operate their existing assets while expanding capacity to new asset types. Our Power Grid business, which has supported Nordic customers in building probably the strongest grid in Europe, has ready-made solutions for the European DSOs in terms of both the digitalisation of grid operations and distributed energy resources (DERs). By 2030, we’ll have 200 million small-scale power assets in Europe – rooftop solar, small wind and hydro, biomass and geothermal power, as well as storage such as electric vehicles and residential electric water heaters. Volue is building tools that accelerate the integration of DERs in the power system. Through forecasting where and when DERs are needed in the grid, we reduce the need for additional grid investment. Priorities and ambitions for 2022 and beyond Volue is here to deliver services critical to society for a cleaner, better, and more profitable future. We offer an unrivalled landscape of capabilities, allowing our customers to increase performance in a volatile market. Our unique coverage along the energy management value chain puts us in a pole position to deliver game-changing services that help our customers increase their top-line, reduce risk and protect profit margins. An important goal for us this year is to continue to invest in market expansion outside our European home market. We want to achieve this while maintaining a 8 healthy EBITDA margin in line with Q4 2021. At the core of our growth strategy is a focus on recurring revenues through Volue’s ongoing SaaS transformation. Seeing that the energy market is quite fragmented, we believe that there is an opportunity to take a leading position in much-needed market consolidation. As we operate in attractive end-markets undergoing transformation, in 2022 we will focus our investments on scalable growth. Last but not least, as we continue to pursue synergies within the Volue group, we see that there are many opportunities for increased operational efficiency. With a successful 2021 behind us, we are quite bullish about the future. We are now looking to exceed our NOK 2 billion revenue target for 2025. We believe in growth first of all because our end market is growing. Our customers’ spending on advanced software solutions is growing as a consequence of the green transition and market changes. We also see opportunities for European expansion. We now have a solid footprint in the European market, and we continue to invest in sales and marketing outside the Nordic region. Annual Report 2021 Leer from the CEO Our experience also shows that Volue has a great opportunity to realise synergies by selling our expanded portfolio of offerings. Looking at our recurring revenues, we see that SaaS contracts hold double the amount of recurring revenues, compared to traditional contracts. This is because we take a larger responsibility when operating the software with an associated Service Level Agreement. We see this in our infrastructure business, which is very much focused on SaaS transformation in our home market, with more than 900 customers in the infrastructure construction business and covering 84% of the Norwegian population with our water and wastewater business. As we progress with our SaaS transformation, we believe in an uptick in margins, with an EBITDA level towards 30%, SaaS revenues increasing to 50% and recurring revenues towards 80% in 2025. Less than two years ago, Volue comprised four individual companies with separate management teams, a fragmented customer approach, no common R&D or product development strategies, and a mostly Norwegian footprint. The company grew through the acquisitions of Likron and ProCom and, today, the six companies have joined forces behind one brand and in one organisation. We believe that Volue with its size and market reach can bring value to the industry by acting as a consolidator. Entering 2022, I feel that we have created a robust organisation ready to support the digital transformation of the industries we work in. I am convinced that the efforts of our people will enable us to successfully execute our strategy. Last but not least, thank you to our customers, partners, and shareholders for their continued trust and support! 9 Annual Report 2021 Board of Directors’ report Board of Directors’ report Volue reported solid performance and strong growth for the full year 2021. The Company delivered operating revenues of NOK 1,039 million (892 million in 2020) and adjusted EBITDA of NOK 214 million (197 million in 2020) with an adjusted EBITDA margin of 21%. See note three to the ﬁnancial statement for description on non-recurring items in EBITDA. All product lines delivered strong operational performance, and good order intake with more than 3,200 deals closed during the year. The Company is continuing the build-up of a highly sticky customer base and has since 2018 reported an average yearly churn of about 1%. Growth and scalability are core for improving margins over time, and Volue continues to strategically invest to scale for further growth. The revenue growth of 17% year-on-year was mainly driven by the Energy Segment, increasing by 30% from NOK 456 million in 2020 to NOK 595 million in 2021. Expansion of European footprint and growing international activities are the main drivers for growth through new markets and solution such as trading, optimalisation, forecast and analyses. Annual recurring revenues reached NOK 667 million, a 17% growth from 2021, while SaaS revenues showed a 50% growth year on year. The market remains strong and attractive as the shift towards green, non-controllable energy sources drives increased volatility and complexity for customers, requiring dynamic and cloud- based software solutions. Volue also believes the integration of ProCom and Likron will further help cementing its position as the leading provider in Europe. Business and location Volue’s business model is to supply software and technology solutions for the energy, power grid and infrastructure markets, serving over 2 200 customers in 40+ countries. Based on 50 years of green technology expertise, Volue offers software solutions, systems and market insight that optimise production, trading, distribution and consumption of energy, as well as infrastructure and construction projects. As one of Norway’s leading software companies, Volue has unrivalled coverage along the clean-energy value- chain, from monitoring using sensors to realising cash in trading. Volue’s technology secures availability of the core services society relies on – energy, water and infrastructure. Volue is headquartered in Oslo, Norway, with teams based across 30 offices all over Europe, thereby enabling the company to be closely connected to its customers, markets, and industries. Industry segments The business is organised into three industry segments: Energy, Power Grid and Infrastructure, with eight product lines. The Energy segment delivers solutions that help customers master the energy transition by enabling wall-to-wall digitalisation of the green energy value chain. The Power Grid segment enables power distributors to support electrification of society by unlocking flexibility and digital management of the power grid. The infrastructure segment offers customers flexible capabilities for digital water management and helps automate processes and machines for the construction industry. Energy Segment Operating revenues in the Energy segment increased by 30% to NOK 595 million in 2021 (459 million in 2020), representing 57% (52% in 2020) of the group’s revenues. Adjusted EBITDA rose to NOK 124 million in 2021 (97 million in 2020) with an EBITDA margin of 21% in 2021, (21% in 2020). The Energy Segment delivered very strong results and increased profit due to scalable growth. The adjusted EBITDA margins improved following strong uplift in SaaS and overall sales. 10 Volue sees high volatility in the power market, which creates tail-wind for the trading software from the company’s SaaS-platform as well as increasing demand for the Company’s services. Volue’s business outside the Nordic is growing rapidly and in the home market where Volue is leading, there is a strong development within portfolio management as a service. Combined, this results in strong growth in SaaS revenues. Expansion of European footprint and growing international activities are the main drivers for further growth through new markets and solution such as trading, optimalisation, forecast and analyses. Part of Volue’s initial focus was the most complex optimisation challenges for hydropower. Since then, the Company has expanded its platform into thermal, solar, wind and batteries, which is important to Volue’s customers as they continue to operate existing assets, while at the same time expanding capacity in new asset types. Trading solutions is a growing part of the portfolio and the integrated business of Likron and ProCom will be core as part of Volue’s offering across the value chain. CAPEX levels in the Energy segment represents approximately 10% of revenues, which is mainly composed of by R&D investments. Going forward, significant investments into new products related to optimisation and trading solutions are planned. Power Grid Segment Operating revenues in the Power Grid segment increased by 6% to NOK 249 million in 2021 (236 million in 2020), representing 24% (26% in 2020) of the group’s revenues. Adjusted EBITDA decreased Annual Report 2021 Board of Directors’ report to NOK 32 million in 2021 (57 million in 2020) with an adjusted EBITDA margin of 13%, compared with 24% in 2020. Within Power Grid, Volue holds a strong market position in the Nordics. The segment delivered strong sales and good progress on project deliveries, resulting in solid uplift in ARR level. The combination of increased activities for market expansion and Go-Live of a delivery project in Sweden influenced the EBITDA margins negatively. EBITDA margins are expected to improve going forward as the market outlook for the segment is good. With decades of experience supporting customers, the Nordic region has built one of the strongest grids in Europe, which is now being put under pressure by the enormous growth in power supply assets that will start playing an active role in the energy system. The electrification of the society is growing, creating new challenges and opportunities and Volue is in a strong position to capitalise on this growth through its 50 years’ of asset and vendor independent experience. Volue aims to further expand its footprint in the Power Grid segment through its market position in the Energy segment. CAPEX levels in the Power Grid segment represented approximately 10% of revenues in 2021 and are related to R&D. CAPEX levels are expected to increase over the next 12 months due to ongoing investments in new product development such as Distributed Energy Resources. 11 Infrastructure Segment Operating revenues in the Infrastructure segment slightly decreased to NOK 197 million in 2021, from NOK 201 million in 2020, representing 19% of the group’s revenues. Adjusted EBITDA increased by 8% to NOK 57 million in 2021 (53 million in 2020), with an adjusted EBITDA margin of 29%, up from 26% in 2020. For the Infrastructure segment, shift in business models towards SaaS are progressing as planned. This gives an expected short term revenue impact. The shift in business models combined with ongoing investments in market expansion, is putting pressure on EBITDA margins throughout 2022. Volue has so far focused on SaaS transformation in its home market. Volue forecasts further increased profitable growth in Scandinavia, driven by the on- going expansion to Sweden and Denmark. CAPEX levels in the Infrastructure segment represented approximately 12% of revenues in 2021 but are expected to remain at Q4 2021 level of around 14% in the near term. The ongoing investments are made to increase offerings on Volue’s SaaS platform as well as additions to the current product range addressing innovative solution for the water industry. Important events in 2021 Cyber-incident In the spring of 2021, Volue was the subject of a serious cyberattack. The cyberattack impacted operation in some of the company´s business areas. Mitigating actions were immediately implemented Annual Report 2021 Board of Directors’ report and there was limited impact on front-end customer platforms. The company immediately deployed its cyber task force and initiated mitigating actions. All affected applications were shut down and backup solutions initiated as far as possible. The company was supported by its external data security partners to neutralise the attack and relevant authorities were informed. In December, Volue received an insurance settlement of NOK 20 million related to the cyber incident in May 2021. The settlement has been recognised as other income in the quarter, reducing the estimated financial impact related to the cyber incident from NOK 40 million to NOK 20 million. The amount received was the maximum payout under Volue’s insurance coverage and was in line with the Company’s expectations. Volue presented a www.volue.com/news/ postmortem on its website about what happened during the cyberattack and how the company will prevent similar attacks from happening in the future. The Board of Directors are pleased with the way the company handled the cyber-incident and the build back better program. Externally the company has been given credit for the transparency in the market and with our customers. New products and initiatives The company is working on several new initiatives such as Distributed Energy Resources and new products related to optimisation and trading solutions, which will require higher investments going forward. 12 The way societies produce, distribute and consume energy will change dramatically. By 2030, there will be more than 200 million Distributed Energy Resources such as electrical vehicles, rooftop solar and heat pumps in Europe, needing cost efficient and digital value chains. The SaaS market potential is significant and Volue is well positioned to build the tools necessary to solve these complex challenges for the next generation power market optimisation. Acquisition of ProCom On 1 October 2021, Volue closed the acquisition of German ProCom GmbH (ProCom) with a preliminary purchase price of EUR 2.15 million. Through the acquisition, Volue added EUR 3 million in annual recurring revenues, approximately 60 employees, and over 60 customers. ProCom is headquartered in Aachen, Germany and has offices in Cologne and Berlin. With a proud heritage as a family business, ProCom has provided leading technology solutions for more than 40 years to the energy sector and adjacent industries. ProCom further strengthens Volue’s offering within optimalisation solutions for power producers in Europe and we get access to a new scalable market in the DACH region with an existing and complementary customer base. Transfer of listing from Euronext Growth to Oslo Stock Exchange Volue transferred its listing from Euronext Growth to Oslo Stock Exchange with first day of listing at Oslo Stock Exchange 4 May 2021. Financial statements The Board of Directors believes that the annual financial statements provide a true and fair view of the net assets, financial position and result of Volue ASA for the year. The company’s consolidated financial statements are presented in compliance with International Financial Reporting Standards (IFRS) as adopted by the EU. Profit and loss Operating revenue was NOK 1,039 million, up from NOK 892 million in 2020, which represents 17% revenue growth. EBITDA was NOK 138 million compared with NOK 148 million in 2020. Volue had a profit for the period of NOK 28 million compared to NOK 99 million in 2020. Earnings per share were NOK 0.19 in 2021, compared to 0.76 in 2020. Adjusted EBITDA was reported to NOK 214 million, see note 3 to the financial statement for further information regarding non-recurring effecting adjusted EBITDA. Cash flow Net cash from operating activities was NOK 138 million in 2021 compared with NOK 210 million in 2020. The decrease in cash flow from operating revenues is related to change assets and liabilities, while cash flow from net income is in line with 2020. Net cash used for investing activities in 2021 was NOK -120 million, compared to NOK -159 million in 2020, Net cash from financing activities was NOK -41 million, compared to NOK 141 million in 2020. Net cash flow was NOK -22 million. Financial position The Board considers the Volue’s cash and financial position to be strong. Volue had a debt/equity ratio of 1.28 at year-end compared with 0.98 at the end of 2020. Annual Report 2021 Board of Directors’ report 13 Net interest-bearing debt was NOK 382 million at year end, while total assets were NOK 1,746 million. Total equity attributable to shareholders of the parent company as of 31 December 2021 amounted to NOK 764 million. At the end of 2021, Volue had NOK 404 million in cash and cash equivalents. According to section 3–3 of the Norwegian Accounting Act, we confirm that the consolidated financial statements and the financial statements of the parent company have been prepared based on the going concern assumption, and that it is appropriate to make that assumption. Volue ASA The parent company Volue ASA is a holding company, with very limited activity and a few corporate functions. Profit for the year was NOK -3.1 million in 2021. Net cash flow was NOK -90 million and the equity ratio was 97% at year end 2021. Risk factors and risk management Risk factors Volue operates on an international level and provides software solutions, platforms and related services within various market segments, including energy and electricity, infrastructure and construction, water supply and the government/ municipalities. The Group’s operations may consequently be affected by global economic and political conditions in the markets in which it operates. The outlook for the world economy remains subject to uncertainty. Downturns in general economic conditions, whether globally or in the specific region or end markets segments in which the Group operates, can result in reduced demand for the Group’s software solutions and platforms, or lead to less competence and manpower being available; both which could have a material negative impact on the Group’s revenues, profitability and growth prospects. Both the technology market and the energy market are highly competitive, especially in relation to software solutions and investment services offered to participants within the energy markets. Some of the Group’s competitors are large, sophisticated and well-capitalised technology and software companies that may have greater financial, technical and marketing resources than the Group. Increased competition in the energy market could result in price reductions, loss of market share, reduced margins and fewer customer orders. Moreover, in the ‘war for talent’ the Group could lose competent personnel to its competitors. The Group’s software solutions, platforms, analyses and trading and management services are based on complex software technology. The Group sets high- quality and security standards for its products and services, but it is possible that software solutions and platforms nevertheless may contain errors or defects or otherwise not perform as expected. Although the Group carries out control procedures for testing, monitoring, securing and developing its solutions and platforms, there is a risk that these procedures may fail to test for all possible conditions for use, or identify all defects or errors in the specific software used in its solutions and platforms. Additionally, errors or defects in the Group’s software solutions and platforms may lead to significant reputational damage for the Group, which could result in loss of customers, loss of good will and consequently reduced future sales. The Group’s software solutions and platforms are subject to substantial external threats associated with data security, such as risk of virus attacks, attempts at hacking, social manipulation and phishing scams. Furthermore, there is a risk that the data and systems delivered to the Group by third parties and in which the Group base the development and the functionality of its software solutions and platforms on are incorrect or inadequate, that the rights to such third party data is not secured sufficiently, or that such data and systems contain failures, viruses or other defects or errors, which could materially affect the quality, functionality and use of the Group’s products and services. Moreover, the Group’s business includes also processing of sensitive information on behalf of the Group’s customers such as critical infrastructure data or personal data. Any failure to comply with the applicable laws and regulations with regards to processing of such data as well as the contractual obligations towards the customers can lead to significant financial implications such as customers’ indemnification claims, fines from public authorities, etc. The foreign exchange rate risk for the Group relates to the fact that the Group’s business transactions and operations are made in several currencies, including the Norwegian krone, Euro and U.S dollar. Unfavourable fluctuations in exchange rates of especially the Norwegian Krone, the Euro or the U.S. dollar could have an adverse effect on the Group’s business, financial positions and profits. Annual Report 2021 Board of Directors’ report 14 Risk management Volue’s Board of Directors and Executive Management conduct risk assessments relating to various dimensions and aspects of operations, to verify that adequate risk management systems are in place. The Group’s financial risk is predominantly controlled by the finance departments in the group companies, under policies approved by the Board of Directors. Financial risks are identified, evaluated, and hedged in close co-operation with the Group’s operating units. The Board provides written principles for overall risk management, as well as policies covering specific areas, such as currency risk, interest rate risk and credit risk. With regards to the legal and compliance risk, the Group’s management has approved several policies and internal quality routines, including a legal policy, which shall ensure that the Group is sufficiently informed about the nature of any legal and compliance risks in all markets or countries it operates. In addition to the framework of management procedures and policies, internal guidelines and standard contracts, the Group’s Legal, Compliance and Quality team supports the organisation proactively in order to minimise the Group’s risk of being exposed to any breach of applicable laws and regulations, or contractual obligations towards its customers. Furthermore, the Group’s quality team conducts regular internal audits for ensuring compliance with the internal management framework and is also responsible for handling external audits such as ISO certification audit, etc. Research and development Research and development Investments into research and development (R&D) has been an important part of Volue’s strategy to develop new and innovative technological solutions and is expected to remain an important part of the company’s strategy going forward. Volue has a long- term ambition to invest significantly in R&D, with approximately 10-12% of its annual revenue being capitalised in balance sheet, to secure long-term growth. For 2021, the company capitalised invested a total of NOK 106 million in R&D, up from NOK 86 million in 2020, representing 10% of the revenues for the year. Sustainability Volue sets high ethical standards, and communication should be open, clear and honest. The Company is responsible for ensuring safe and good workplaces where it is present and seeks to create value for society, customers, employees and shareholders. Volue’s expertise within energy production, optimisation, trading and distribution allows energy companies to get the most out of their resources and can play an important role in enabling a future with a greener, yet more volatile, energy mix and increased electrification. Further, by providing instrumentation and automation for hydropower producers, Volue improves the accuracy in the monitoring of hydropower dams including production predictions, planning and sustainable governance of regulated water courses. In 2020, Volue published its first sustainability report. The report has been updated for 2021 and is prepared in accordance with the Global Reporting Initiative (GRI) Standards framework, in addition to Section 3-3 of the Norwegian Accounting Act regarding corporate social responsibility and the Euronext Guidelines for sustainability reporting. The sustainability report describes Volue’s performance in areas defined as material to the Company, based on systematic stakeholder dialogue and a materiality assessment conducted in 2021. Focus areas for Volue includes Great place to work, Ethical business conduct, Environment and Secure products and operations. In addition to stating how the Company performs on each area, the report also discusses improvements and lists ambitions and targets going forward. In 2021, Volue became a signatory of the UN Global Compact (UNGC) – a voluntary initiative based on CEO commitments to implement universal sustainability principles and to take steps to support UN goals. As a signatory, Volue actively engages with the UN Global Compact and make an annual financial contribution, based on our annual gross sales or revenue. The next section provides a summary of the sustainability work and results in 2021. For further information, refer to the ESG report 2021. Organisation and equal opportunities Recruiting and retaining top talent and ensuring a diverse workforce is a prerequisite for future value Annual Report 2021 Board of Directors’ report 15 creation. At the end of 2021 the group employed a total of 715 people, and adjusting for part- time and temporarily hired employees, this translates to 648 full-time equivalents. Volue will cultivate a company culture characterised by respect, inclusion, equality, and diversity. The company prohibits discrimination in any form and shall comply with internationally accepted guidelines and conventions regarding worker’s rights, gender equality and anti-discrimination. In Norway, Volue operates according to the Norwegian Working Environment Act and the Equality and Anti-Discrimination Act, which aims to promote equality and prevent discrimination on the basis of gender, ethnicity, religion, political beliefs, disability, sexual orientation and/or age. The Company also complies with similar laws in other countries where it is present. Volue aspires to substantially increase the share of non-Nordic employees and is working throughout the employee lifecycle to see where measures can be implemented to enhance diversity across the organisation. To date, Volue’s workforce comprises several different nationalities, of which 74% are Nordic and 26% are non-Nordic employees. Women represented 23% of Volue’s workforce (permanent employees) in 2021. The executive leadership team (ELT) had at year-end 2021 six male and two female members. The Board of directors had five male and five female members. “A Diversity Policy has previously been established for Powel (one of the four companies that was merged into the Volue Group in 2020). Volue has based its diversity and equality work on the same policy and will in 2022 establish a new Diversity Policy which will be implemented for the whole Group.” A continuous goal for Volue is to increase the number of female employees and leaders, and the Company’s ambition is to establish a 30% gender balance on all levels of the organisation. To achieve this, Volue is part of several diversity initiatives, including the ODA Network and Kraftkvinnene. Additionally, the Company regularly conduct development talks, has introduced training programmes for employees and carry out several engagement surveys throughout the year. The average pay for men and women varies due to differences in job categories and seniority. Guidelines for remuneration of the ELT was approved by the Extraordinary General Meeting in December 2021 and a full disclosure can be found in the separate Remuneration report. Guidelines for remuneration of leading persons are available in the company’s website. Further details about organisation and Volue’s statements on equality and anti-discrimination are available in the Company’s sustainability report. Health, safety, security and environment (HSSE) Throughout 2020 and 2021, Volue has placed even greater emphasis on employee satisfaction and welfare, in light of the ongoing Covid-19 pandemic. Absence due to illness in 2021 ranged from 1% to 4.8% (2% in average for 2020) depending on country, and Volue’s goal is to keep absence at a minimum and to not exceed a 3% absence rate. The labour turnover rate was 11%, with 99 employees leaving the company in 2021. There were no work- related injuries in 2021. In 2022, Volue will increase effort and focus on systematic HSSE work, risk assessment and reporting of occupational incidents. Business ethics and human rights Volue aspires to build a strong company culture, where ethical behaviour, transparency and openness are values that employees and business partners adheres to. In addition to ensuring that the work is carried out safely this involves respecting the freedom of association and not accepting any form of forced labour, child labour or work-related discrimination. Volue will always align its conduct with internationally renowned standards for human and worker’s rights, such as the Human Rights Act and OECD guidelines for multinational enterprises. The company established a new Code of Conduct in 2021 which includes rules with regards to business conduct, values, and ethics. The Code of Conduct is available on Volue’s website. In addition thereto, the company has introduced a Supplier Code of Conduct which includes the aforementioned rules and ethics and which is mandatory to be signed by any new supplier to the Group. An external whistleblower channel was established in 2021, which allows all employees and stakeholders of Volue as well as any externals such as suppliers etc to report any potential or Annual Report 2021 Board of Directors’ report 16 Annual Report 2021 Board of Directors’ report actual breach of the Company’s Code of Conduct, both through internal channels and the Company’s website. The whistleblower channel is operated by a neutral third party and any whistleblower has the option to be anonymous. Climate Volue’s environmental impact is two-fold. First, the company has an impact through developing products and services which enable a green transition for customers. Second, the company has an environmental impact from internal business operations such as emissions from employee business travels, energy consumption at the company’s office locations and waste generation. Volue is in a position where impacts of climate changes and subsequently the energy transition represents business opportunities rather than risks. The opportunities are connected to customers within the Energy, Power Grid and Infrastructure market segments and includes their operation of existing physical assets and to their transition plans. Volue started climate accounting in 2020 and is in the process of setting targets for reducing energy consumption and GHG emissions from its business operations. The climate accounting was updated in 2021 using CEMAsys’ digital solution, and a full overview can be found in the separate climate report on the company’s website. Volue has a limited amount of company cars and does not use heating oil and thus has no emissions in Scope 1. Volue’s emissions from Scope 2 come from electricity and district heating from the offices and show an emission of 67.2 tCO2e in 2020 and 96.2 tCO2e in 2021. Volue has included emissions from flights, mileage allowance and train travel in its Scope 3 calculations for 2021. This shows emissions of 88.9 tCO2e in 2021. All Volue’s business locations have a waste management system to facilitate recycling according to local regulations. Corporate governance Volue’s Board of Directors has the overall responsibility for ensuring that the company has a high standard of corporate governance. The Company’s corporate governance model is designed to provide a foundation for long-term value creation and to ensure good control. The Board has adopted a corporate governance policy to safeguard the interests of the company’s owners, employees and other stakeholders. The policy describes the company’s main principles for corporate governance and addresses the framework of guidelines and principles regulating the interaction between the company’s shareholders, the Board of Directors, the CEO and the Executive Leadership Team. These principles and associated rules and practices are intended to increase predictability and transparency, and thus reduce uncertainties related to the business. The company complies with the Norwegian Code of Practice for Corporate Governance. The Board’s Corporate Governance report is available on the Company’s website under the Investor section. Share capital and the Volue share Volue ASA is listed on Oslo Stock Exchange under the ticker “VOLUE”. The Company’s share capital was NOK 57,547,885.60 divided on 143,869,714 shares at year end 2021, each with a nominal value of NOK 0.40. All shares are of the same class and with equal voting and dividend rights. Per 31 December 2021, the number of shareholders were 4,511. Refer to the notes to the financial statements for further information. Volue aims at informing all interested parties about important events and the Company’s developments through annual reports and quarterly financial presentations, stock exchange notices and other Company updates. There are no provisions in the company’s articles of association that limit the right to own, trade or vote for shares in the company. Further information can be found in the investor section of Volue’s website . Liability insurance Volue holds a liability insurance for its Board of directors and ELT under Arendals Fossekompani’s policy at the same conditions as Arendals Fossekompani. The territory covered is worldwide. Going concern There have been no events to date in 2022 that significantly affect the result for 2021 or valuation of the Company’s assets and liabilities at the balance sheet date. The Board confirms that the conditions for the going concern assumption have been satisfied and that the financial statements for 2021 have been prepared on the basis of this assumption. 17 Annual Report 2021 Board of Directors’ report Outlook In 2021, Volue continued delivering on its strategy of international expansion, and closed more than 3,200 deals. The market remains strong and attractive, and the integration of ProCom and Likron will further help cementing Volue’s position as the leading provider in Europe. Volue sees large opportunities to secure continued profitable growth and aims to develop its business both organically and structurally and the key drivers for further growth are: • A growing end-market: Customers’ spend on advanced software solutions is growing as a consequence of the green transition and market changes. • European growth: Volue has a solid foot-print in the European market, and continue to invest outside the Nordic region - still representing the largest source of revenue. • Increasing synergies: Volue sees good opportunities to realise further synergies between the various Volue companies by selling the expanded portfolio of offerings across the clean energy value chain. Volue has a strong foundation for continued profitable growth and expansion. The long-term ambition is to exceed NOK 2 billion revenues by 2025, with 15% annual organic revenue growth, SaaS revenues increasing to 50%, recurring revenues towards 80% and an adjusted EBITDA margin towards 30%. For 2022, the Company has outlined the following additional priorities and ambitions: • Expand activities outside Europe • Adjusted EBITDA margin in line with fourth quarter 2021 • Continue to grow ARR business in line with 2025 targets and 2021 performance • Structural growth through M&A • Strategic investments for international growth • Further utilise synergies and strengthen organisation The Board wishes to thank all of Volue’s employees for their continued dedicated efforts, contributing to Volue’s strong growth and achievements in 2021. Ørjan Svanevik Chairman of the Board Lars Peder Fensli Board Member Ingunn Ettestøl Board Member Henning Hansen Board Member Christine Grabmair Board Member Kjetil Kvamme Board Member Knut Ove Stenhagen Board Member Annette Maier Board Member Anja Schneider Board Member Vija Pakalkaite Board Member Trond Straume Chief Executive Officer Oslo, Norway, 29 March 2022 The Board of Directors and CEO Volue ASA 18 Annual Report 2021 Consolidated ﬁnancial statements Consolidated ﬁnancial statements Consolidated statement of income 19 Consolidated statement of other comprehensive income 20 Consolidated balance sheet 21 Consolidated statement of changes in equity 22 Consolidated statement of cash flows 23 Notes to the Consolidated Financial Statements Note 1 Accounting principles 24 Note 2 Key sources of estimation uncertainty, judgments and assumptions 32 Note 3 Segments 32 Note 4 Revenue from contracts with customers 34 Note 5 Remuneration and employee benefit 35 Note 6 Other operating expenses 36 Note 7 Income tax 36 Note 8 Inventories 37 Note 9 Trade and other receivables 38 Note 10 Cash and cash equivalents 38 Note 11 Property, plant and equipment 39 Note 12 Intangible assets 40 Note 13 Non-current receivables and investments 41 Note 14 Leases 42 Note 15 Trade payables and other current liabilities 42 Note 16 Financial risk and financial instruments 43 Note 17 Borrowings 46 Note 18 Finance items 47 Note 19 Share information 48 Note 20 Earnings per share 49 Note 21 Business combinations and transactions with non-controlling interests 50 Note 22 Subsidiaries 52 Note 23 Discontinued operations 53 Note 24 Related parties 54 Note 25 Contingent liabilites 55 Note 26 Subsequent events 55 Note 27 Other income 55 Annual Report 2021 Consolidated ﬁnancial statements 19 Consolidated statement of income For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Continuing operations Sales revenues 3,4 1 039 075 891 866 Other revenues 27 21 603 Revenues 1 060 678 891 866 Materials and consumables used 159 075 157 781 Employee benefit expenses 5 549 310 470 787 Other operating expenses 6 196 863 115 317 Other gain/losses 21 17 305 Operating expenses 922 553 743 886 EBITDA 138 125 147 980 Depreciation and amortisation 11,12 91 317 65 017 Impairment loss from PPE 11,12 1 780 1 004 Net operating income/(loss) 45 028 81 960 Finance income 18 18 373 17 169 Finance costs 18 23 898 23 797 Profit/(loss) before income tax 39 503 75 333 Income tax expense 7 11 884 15 075 Profit/(loss) from continuing operations 27 619 60 258 Profit/(loss) from discontinued operation - 38 803 Profit/(loss) for the period 27 619 99 061 Attributable to equity holders of the company 27 825 82 232 Attributable to non-controlling interests - 205 16 829 Basic earnings per share 20 0.19 0.76 Diluted earnings per share 20 0.19 0.76 Basic earnings per share from continuing operations 20 0.19 0.42 Diluted earnings per share from continuing operations 20 0.19 0.42 Annual Report 2021 Consolidated ﬁnancial statements 20 Consolidated statement of other comprehensive income For the year ended 31 December Amounts in NOK 1000 2021 2020 Items that may be reclassified to statement of income Exchange differences on translation of foreign operations - 12 851 - 85 Changes on cash flow hedges 2 208 - 331 Income tax related to these items - - Items that may be reclassified to statement of income - 10 643 - 416 Items that will not be reclassified to statement of income Remeasurements of post-employment benefit obligations 2 633 637 Income tax relating to these items - 564 - Items that will not be reclassified to statement of income 2 070 637 Other comprehensive income/(loss) for the period, net of tax - 8 574 221 Total comprehensive income/(loss) for the period 19 046 99 282 Attributable to equity holders of the company 19 169 82 428 Attributable to non-controlling interests - 123 16 854 Annual Report 2021 Consolidated ﬁnancial statements 21 Consolidated balance sheet For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Assets Non-current assets Property, plant and equipment 11 140 975 162 492 Intangible assets 12 542 528 462 975 Pension assets 5 18 064 14 622 Non-current receivables and investments 13 29 300 31 774 Deferred tax assets 7 4 709 7 950 Total non-current assets 735 577 679 813 Current assets Inventories 8 19 895 13 137 Contract assets 4,16 65 595 39 335 Trade and other receivables 9,16 519 858 296 312 Other current assets 16 922 562 Financial investments 16 - 10 000 Cash and cash equivalents 10 404 390 433 527 Assets connected to discontinued operation 23 - - Total Current assets 1 010 659 792 874 Total assets 1 746 235 1 472 687 Amounts in NOK 1000 Note 2021 2020 Equity and liabilities Equity Share capital and share premium 4 498 115 4 492 332 Own shares - 92 - Other reserves - 3 733 989 - 3 752 655 Capital and reserves attributable to holders of the company 764 035 739 676 Non-controlling interests 2 842 3 411 Total equity 19,20 766 876 743 087 Non-current liabilities Lease liabilities 14 87 495 117 475 Employee benefits 560 8 731 Other non-current liabilites 21 - 28 500 Provisions 14 505 372 Deferred tax liabilities 7 29 200 26 385 Total non-current liabilities 131 760 181 463 Current liabilities Borrowings 17 17 529 3 695 Lease liabilities 14 27 675 21 356 Trade and other payables 15 350 686 146 633 Current tax liabilities 7 18 584 15 606 Contract liabilities 4 48 688 55 917 Other current liabilities 4, 15 ,16 384 437 304 930 847 599 548 138 Liabilities connected to discontinued operation 23 - - Total current liabilities 847 599 548 138 Total liabilities and equity 1 746 235 1 472 687 Oslo, Norway, 29 March 2022 The Board of Directors and CEO Volue ASA Ørjan Svanevik Chairman of the Board Lars Peder Fensli Board Member Ingunn Ettestøl Board Member Henning Hansen Board Member Christine Grabmair Board Member Kjetil Kvamme Board Member Knut Ove Stenhagen Board Member Annette Maier Board Member Anja Schneider Board Member Vija Pakalkaite Board Member Trond Straume Chief Executive Officer Annual Report 2021 Consolidated ﬁnancial statements 22 Consolidated statement of changes in equity For the year ended 31 December Attributable to equity holders of the company Amounts in NOK 1000 Note Share capital and share premium Own Shares Other reserves Total Non- controlling interests Total equity Balance at 1 January 2020 - - 321 298 321 298 40 442 361 740 Profit/(loss) for the period - - 82 232 82 232 16 829 99 061 Other comprehensive income/(loss) - - 196 196 25 221 Transaction with owners Share capital increase contribution in kind Arendal Fossekompani 19 3 904 733 - - 3 904 733 - - - Acquisition of non-controlling interest 21 8 940 - -222 291 - 213 351 - 25 520 - 238 871 Disposal of discontinued operations 23 - - - - - 16 238 - 16 238 Shares issued as consideration in business combinations 21 28 593 - - 28 593 - 28 593 Issue of ordinary shares for cash 19 567 604 - - 567 604 - 567 604 Transaction cost share issue, net of tax 19 - 17 539 - - - 17 539 - - 17 539 Divdends - - - 29 357 - 29 357 - 12 127 - 41 484 Balance at 31 December 2020 4 492 332 - - 3 752 655 739 676 3 411 743 087 Balance at 1 January 2021 4 492 332 - -3 752 655 739 676 3 411 743 087 Profit/(loss) for the period - - 27 825 27 825 - 205 27 619 Other comprehensive income/(loss) - - - 8 656 - 8 656 83 - 8 574 Transaction with owners Share capital increase contribution in kind Arendal Fossekompani 19 - - - - - Acquisition of non-controlling interest 21 - - - 3 998 - 3 998 - 446 - 4 445 Disposal of discontinued operations 23 - - - - - - Shares issued as consideration in business combinations 21 14 174 - - 14 174 - 14 174 Reclassifications - - 3 496 3 496 - 3 496 Own shares - 8 390 - 92 - 8 482 - - 8 482 Issue of ordinary shares for cash 19 - - - - - - Transaction cost share issue, net of tax 19 - - - - - - Divdends - - - - - - Balance at 31 December 2021 4 498 115 - 92 - 3 733 989 764 035 2 842 766 876 Annual Report 2021 Consolidated ﬁnancial statements 23 Consolidated statement of cash ﬂows For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Cash flow from operating activities Profit/(loss) before income tax 39 503 75 333 adjustments for: Depreciation, amortisation and impairment 11 ,12 93 097 65 017 Net financial items 18 5 532 6 627 (Gain)/Loss from sales of assets Tax on transaction costs related to share issue - - 4 947 Total after adjustments to profit before income tax 138 132 142 030 Change in Inventories - 6 905 2 749 Change in other current assets - 232 666 - 80 848 Change in other current liabilities 270 717 175 841 Change in other provisions - 28 541 - 212 Change in employee benefits - 744 4 939 Total after adjustments to net assets 139 993 244 499 Change in tax paid - 1 571 - 14 037 Net cash from operating activities (continued operations) 138 422 230 461 Net cash flow from operating activities (discontinued operations) - - 20 290 Net cash flow from operating activities 138 422 210 172 Cash flow from investing activities Interest received 2 806 7 335 Proceeds from the sales of PPE - 673 Purchase of PPE and intangible assets 11,12 - 118 251 - 135 161 Proceeds from sales of financial assets 10 000 - Purchase of other investments - 824 - 1 224 Loans to employees 13 - 30 086 Proceed from sale of other investments - 74 Purchase of shares in subsidiaries 21 - 13 720 - 62 018 Proceeds from the sales of shares in subsidiaries Net cash flow from investing activities (continued operations) - 119 989 - 220 408 Net cash flow from investing activities (discontinued operations) 23 - 61 109 Net cash flow from investing activities - 119 989 - 159 299 Amounts in NOK 1000 Note 2021 2020 Cash flow from financing activities Proceeds from issue of shares - 550 065 New long-term borrowings 17 5 640 - Repayment of long-term borrowings - - Movement in short term borrowings 17 3 636 - 60 651 Repayment of lease liabilities 17 - 30 940 - 25 506 Interest paid etc. - 8 212 - 16 881 Dividend paid - - 41 484 Acquisition of non-controlling interests 21 - 5 527 - 238 871 Cash Flow from Own Shares - 5 209 Net cash flow from financing activities (continued operations) - 40 614 166 672 Net cash flow from financing activities (discontinued operations) - - 26 170 Net cash flow from financing activities - 40 614 140 502 Net increase in cash and cash equivalents (continued operations) - 22 181 176 726 Net increase in cash and cash equivalents (discontinued operations) - 14 649 Net increase in cash and cash equivalents - 22 181 191 375 Cash and cash equivalents at the beginning of the financial year 433 527 233 117 Effects of exchange rate changes on cash and cash equivalents - 6 956 9 036 Cash and cash equivalents at end of year (discontinued operations) - - Cash and cash equivalents at end of year 404 390 433 527 Annual Report 2021 Consolidated ﬁnancial statements 24 Note 1 Accounting principles Organisation Volue ASA is domiciled in Norway, and with headquarters in Oslo. The consolidated financial statements for financial year 2021 include the company and its subsidiaries (as a whole, referred to as “the Group”). Information about the companies included in the scope of consolidation is disclosed in note 22 in Volue ASA financial statements. Significant accounting policies This note provides a list of the significant accounting policies adopted in the preparation of these consolidated financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated. Basis for preparation The annual and consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) adopted by the European Union and associated interpretations, as well as Norwegian disclosure requirements pursuant to the Norwegian Accounting Act applicable as of 31 December 2021. The Company was established in 2020 by Arendals Fossekompani ASA (“AFK”) for the purpose of being the new holding company for four of AFK’s subsidiaries. AFK transferred its shareholdings in four subsidiaries through contributions in kind to Volue. AFK transferred the shareholdings to Volue. The financial statements are presented in Norwegian kroner (NOK), which is the functional currency of the parent company. All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousand NOK units unless otherwise stated. The financial statements have been prepared using the historical cost principle, except for the following assets, which are presented at fair value: Financial instruments at fair value through profit or loss and financial instruments at fair value through other comprehensive income. The Group recognises changes in equity arising from transactions with owners in the statement of changes in equity. Other changes in equity are presented in the statement of comprehensive income (total return). Preparation of financial statements in accordance with IFRS requires the use of assessments, estimates and assumptions that influence which accounting policies shall be applied, and influence recognised amounts for assets and liabilities, revenues, and costs. Actual amounts can deviate from estimated amounts. Estimates and underlying assumptions are reviewed on an ongoing basis. Changes in accounting estimates are recognised in the period in which they arise if they only apply to that period. If the changes also apply to subsequent periods, the effect is allocated over the current and subsequent periods. Areas with significant estimation uncertainties, and where assumptions and assessments may have significantly influenced the application of the accounting policies, are disclosed in Note 2. Accounting policies The accounting policies applied in the preparation of the annual and consolidated financial statements are described below. In case that subsidiaries have used other principles to prepare their separate annual financial statements, adjustments have been made so the consolidated financial statements are prepared according to common policies. Principles of consolidation Business combinations The acquisition method of accounting is used to account for the acquisition of shares that lead to control over another company. The Group’s consideration is allocated to identifiable assets and liabilities. These are recognised in the consolidated financial Notes to the Consolidated Financial Statements For the year ended 31 December Annual Report 2021 Consolidated ﬁnancial statements 25 statements at fair value at the date when control is obtained. Goodwill is calculated when the consideration exceeds identifiable assets and liabilities: • The consideration transferred; plus • Any non-controlling interest in the acquired entity; plus any gradual acquisition, the fair value of existing shareholdings in the acquired entity; less • Net value (normally fair value) of identifiable net assets included in the transaction If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognised directly in profit or loss as a bargain purchase. If the business combination is achieved in stages, the investment changes classification from associated company to subsidiary, the upward adjustment of the existing shareholding at fair value is recognised as a gain in the income statement. A buyout of non-controlling interests is considered a transaction with owners and does not require a calculation of goodwill. Non-controlling interests for such transactions are adjusted based on a proportionate share of the subsidiary’s equity. When an investment is reclassified from fair value through other comprehensive income to subsidiary or associated company, the investment’s carrying amount at the time control or significant influence is obtained is used as recognised cost. Subsidiaries Subsidiaries are all entities over which the Group has control. Control exists when the investor is exposed or has rights to variable returns from its investment in the company and when it has the ability to influence the return through its power over the company. To determine the level of control, the potential voting rights that can be exercised or converted must be considered. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases. Associated companies Associated companies are entities where the company and/or the Group has significant influence, but not control over financial and operational management. Significant influence is assumed to exist when the Group has between 20% to 50% of the voting rights in a company. The consolidated financial statements include the Group’s share of the profits/losses from associated companies are accounted for using the equity method, from the date significant influence was achieved until it ceases. Elimination of intercompany transactions Intercompany transactions, balances and unrealised gains and losses on transactions between group companies are eliminated. Discontinued operations A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and that represents a separate major line of business or geographical area of operations, is part of a single coordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations are presented separately in the statement of profit or loss. Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The board of Volue ASA has appointed a Group management which assesses the financial performance and position of the group and makes strategic decisions. The Group management, which has been identified as being the chief operating decision maker, consists of the chief executive officer and the chief financial officer. Foreign currency translation Functional and presentation currency Items included in the financial statements of each of the group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in Norwegian kroner (NOK), which is Volue ASA’s functional and presentation currency. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates, are generally recognised in profit or loss. They are deferred in equity if they relate to qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation. Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit or loss, within finance costs. All other foreign exchange gains and losses are presented in the statement of profit or loss on a net basis within other gains/(losses). Annual Report 2021 Consolidated ﬁnancial statements 26 Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on non- monetary assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss, and translation differences on non-monetary assets such as equities classified as at fair value through other comprehensive income are recognised in other comprehensive income. Group companies The results and financial position of foreign operations that have a functional currency different from the presentation currency are translated into the presentation currency as follows: • assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet, • income and expenses for each statement of profit or loss and statement of comprehensive income are translated at average exchange rates, and • all resulting exchange differences are recognised in other comprehensive income. On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other financial instruments designated as hedges of such investments, are recognised in other comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale. Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate. Revenue recognition Revenues from contracts with customers Under IFRS 15, Volue recognises as revenue the agreed transaction price in a contract with a customer at the time when the Group transfers the control of a distinct product or service to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods and services. For each performance obligation identified at the inception of the contract, it is separately determined if those performance obligations are satisfied at a point in time or on an over-time basis. Revenue regarding each performance obligation is recognised when that performance obligation is satisfied. Consequently, revenue is recognised in full upon completion of a contract if it includes only one performance obligation or more than one performance obligations that are satisfied at the same time. The Group’s main revenues come from the sale of software as a service (SaaS), maintenance, licenses, consulting, and other revenue. There are several types of customer contracts depending on what the customer needs. Some contracts may include only one type of service while other contracts include two or more types of services, hence the transaction price will be allocated between different types of revenue depending on the performance obligation. Some of the revenue stream has a substantial part of annual recurring revenue (ARR), which is one of the key performance indicators in the Group. Below is more information about the different types of revenues and related contract types. License fee Infinity software licenses are classified as software licenses where the customer is provided with a right to use the software as it exists when made available to the customer. Revenue from distinct software licenses is recognised when the license key is made available to the customer and the customer can start to use the software. License fees are non-recurring revenues which only occurs once during the contract period. License fees relates to contracts with either consultancy services or maintenance, or both in addition to the fixed license fee. Invoices are generated when the license key is made available to the customers (at a point in time) and most invoices are payable within 30 days. For larger contracts invoices are based on deliveries on agreed milestones. Software as a service (Saas) Software as a service is primarily delivered as a cloud-based solution, which entitles the customers to use the software together with the Group’s network, data base and systems over the contract period. Revenues from sale of Cloud Services are recognised from go-live over time on a straight-line basis over the contract period. The revenue recognition is accrued at a monthly basis. Invoices are generated on a monthly or yearly basis and most invoices are payable within 30 days. The type of contract is subscription to a software or a service. Most SaaS contracts are automatic renewed every year for one more year if not one part terminate the contract. This type of revenue is defined as annual recurring revenue. In combination with delivery Annual Report 2021 Consolidated ﬁnancial statements 27 of a software as a service contract consulting services can be delivered, and revenue recognition occurs as described under consulting revenues. Maintenance revenues Maintenance services related to software are typically a service that is needed throughout the contract period and are typically delivered together with a software license. Revenue recognition from maintenance occurs after the software has been installed and is accrued at a monthly basis. Maintenance services may also be delivered together with a third-party software solution, and revenue recognition occurs from go-live on a monthly linear basis. Most contract are automatic renewed every year for one more year if not one part terminate the contract. This type of revenue is defined as annual recurring revenue. Consulting revenues Consulting services is typically revenue related to project implementation, assisting the customer to start using the software solutions. Consulting services may also relate to value added services or technical support paid by the hour. The performance obligations related to consulting and support services are satisfied on an ongoing basis, and revenue related to the sales of services are thus recognised at the time of delivery. Transactions price The Group determines the transaction price to be the amount of consideration which it expects to be entitled in exchange for transferring the promised goods and services to the customer, net of discounts and sales related taxes. Sales related taxes are regarded as collected on behalf of the authorities. The Group considers whether there are other promises in the contract that are separate performance obligations to which a portion of the transaction price needs to be allocated. Fix price contracts For fixed-price contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided, because the customer receives and uses the benefits simultaneously. This is determined based on the actual labour hours spent relative to the total expected labour hours. Contract balances Contract balances consist of client-related assets and liabilities. Contract assets relate to consideration for work complete, but not yet invoiced at the reporting date. The contract assets are transferred to trade receivables when the right to payment has become unconditional, which usually occurs when invoices are issued to the customers. When a client pays consideration in advance, or an amount of consideration is due contractually before transferring of the license or service, then the amount received in advance presented as a liability. Contract liabilities represent mainly prepayments from clients for unsatisfied or partially satisfied performance obligations in relation to licenses and services. Contract assets are within the scope of impairment requirements in IFRS 9. For contract assets the simplified approach is applied, and the expected loss provision is measured at the estimate of the lifetime expected credit losses. Income tax Income tax on the profit for the period consists of current and deferred tax. Income tax is recognised in the income statement with the exception of tax on items that are recognised directly in equity or in other comprehensive income. The tax effect of the latter items is recognised directly in equity or in other comprehensive income. Current tax is the forecast tax payable on the year’s taxable income at current tax rates at the balance sheet date, and any adjustments of tax payable for previous years less tax paid in advance. Deferred tax liabilities are calculated based on the balance sheet-oriented liability method considering temporary differences between the carrying amount of assets and liabilities for financial reporting and tax values. The following temporary differences are not considered: goodwill not deductible for income tax purposes, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries that are not expected to reverse in the foreseeable future. The provision for deferred tax is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, measured at the tax rates in force at the balance sheet date. Deferred tax assets are recognised only to the extent that it is probable that the asset can be utilised against future taxable results. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax asset will be realised. Tax assets that can only be utilised via group contributions from the parent company are not recognised until the contribution has been paid and is recognised in the individual companies. Annual Report 2021 Consolidated ﬁnancial statements 28 Leases The company’s and the group’s leases consist mainly of office space, machines, cars, IT equipment and other office machines. Assets and liabilities arising from a lease are initially measured on a present value basis. Right-of-use assets are measured at cost comprising the following: • the amount of the initial measurement of lease liability, • any lease payments made at or before the commencement date less any lease incentives received, • any initial direct costs, and • restoration costs. Lease liabilities include the net present value of the following lease payments: • fixed payments (including in-substance fixed payments), less any lease incentives receivable, • variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date, • amounts expected to be payable by the group under residual value guarantees, • the exercise price of a purchase option if the group is reasonably certain to exercise that option, and • payments of penalties for terminating the lease, if the lease term reflects the group exercising that option. Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability. The lease payments are discounted using the lessee’s incremental borrowing rate, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions. Impairment of assets Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period. Cash and cash equivalents For presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet. Trade receivables Trade receivables are recognised initially at the amount of consideration that is unconditional, unless they contain significant financing components when they are recognised at fair value. They are subsequently measured at amortised cost using the effective interest method, less loss allowance. See note 16 for further information about the group’s accounting for trade receivables and note 2 for a description of the group’s impairment policies. Inventories Raw materials and stores, work in progress and finished goods are recognised at the lower of cost and net realisable value. Net realisable value is the estimated sales price in ordinary operations, less the estimated costs for completion and sales costs. Cost is based on the first-in first-out principle and includes costs incurred upon procurement of goods and the costs of bringing them to their present condition and location. For finished goods and work in progress, cost is calculated as a share of the indirect costs based on normal utilisation of capacity. Non-current assets held for sale and discontinued operations Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee benefits, financial assets and investment property that are carried at fair value and contractual rights under insurance contracts, which are specifically exempt from this requirement. Annual Report 2021 Consolidated ﬁnancial statements 29 An impairment loss is recognised for any initial or subsequent write-down of the asset to fair value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset, but not in excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the date of the sale of the noncurrent asset is recognised at the date of derecognition. Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be recognised. Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet. Foreign currency translation Transactions in foreign currencies Transactions in foreign currencies are translated to the functional currency of each individual Group company using the exchange rates at the dates of the transactions. Monetary assets and liabilities in foreign currencies are translated to NOK using the exchange rate at the balance sheet date. Differences that arise from the currency translation are recognised in the income statement. Financial statements of foreign operations Assets and liabilities in foreign currencies are translated to NOK using the exchange rate at the balance sheet date. Revenues and expenses for foreign operations are translated to NOK at the approximate rates of exchange at the transaction date. Financial instruments Non-derivative financial instruments Non-derivative financial instruments consist of investments in debt and equity instruments, trade and other receivables, cash and loans, trade payables and other debts. Trade and other receivables that fall due in less than three months are not discounted. Non-derivative financial instruments are measured on initial recognition at fair value plus any directly attributable transaction costs. After initial recognition, the instruments are measured as described below. Interest-bearing loans are valued at fair value less transaction costs on initial recognition in the balance sheet. Instruments are subsequently measured at amortised cost, with any differences between cost and redemption value recognised over the term of the loan as part of the effective interest rate. Financial assets are derecognised when the contractual rights to the cash flows from an asset expire, or when the Group has transferred the contractual rights in a transaction where the risk and return of ownership of the financial asset have substantively been transferred. Financial assets at fair value through other comprehensive income In accordance with the Group’s investment strategy, investments in equity instruments are mainly classified as fair value through other comprehensive income. After initial recognition, these instruments are measured at fair value. Changes in fair value are recognised in other comprehensive income. Financial assets classified as held for trading A financial instrument is classified at fair value through profit or loss if it is held for trading. The instrument is measured at fair value and the changes in fair value are recognised in the income statement. Other Other non-derivative financial instruments are measured at amortised cost less any impairment losses. Derivatives and hedging activities Derivatives are initially recognised at fair value on the date a derivative contract is entered into, and they are subsequently remeasured to their fair value at the end of each reporting period. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument and, if so, the nature of the item being hedged. Cash flow hedge When a derivative is designated as a hedging instrument on variability in cash flows for a recorded asset or liability, or for a highly probable forecast transaction, the effective portion of a change in fair value is recognised in other comprehensive income. The Group performs a qualitative assessment of hedging effectiveness. A hedging instrument is derecognised when it no longer satisfies hedge accounting criteria, sold, terminated or matures. The accumulated change in fair value recognised Annual Report 2021 Consolidated ﬁnancial statements 30 in other comprehensive income remains until the forecast transaction occurs. If the hedged item is a financial asset, the amount recognised in other comprehensive income is transferred to the income statement in the same period as the hedged item affects the income statement. If the hedged transaction is no longer expected to occur, the accumulated unrealised gains or losses are immediately recognised in the income statement. Fair value hedging When a financial derivative is designated as a hedging instrument on variability in the value of a recognised asset, a firm agreement or liability, the gain or loss on the derivative is recognised in the income statement in the period it incurs. Similarly, changes in the fair value of the hedged item are recognised in the income statement in the same period. Principles related to hedging effectiveness and derecognition are the same as for cash flow hedges. Property, plant and equipment The depreciation methods and periods used by the group are disclosed in note 11 . The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss. When revalued assets are sold, it is group policy to transfer any amounts included in other reserves in respect of those assets to retained earnings. Intangible assets Goodwill Goodwill is measured as described in business combinations above. Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortised but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, being the operating segments ( note 3 ). Other intangible assets and research and development Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the group are recognised as intangible assets where the following criteria are met: • it is technically feasible to complete the product so that it will be available for use, • management intends to complete the product and use or sell it, • there is an ability to use or sell the product, • it can be demonstrated how the product will generate probable future economic benefits, • adequate technical, financial and other resources to complete the development and to use or sell the product are available, and • the expenditure attributable to the product during its development can be reliably measured. Directly attributable costs that are capitalised as part of the product include employee costs and an appropriate portion of relevant overheads. Capitalised development costs are recorded as intangible assets and amortised from the point at which the asset is ready for use. Research expenditure and development expenditure that do not meet the criteria above are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Amortisation methods and periods Refer to note 12 for details about amortisation methods and periods used by the Group for intangible assets. Trade and other payables These amounts represent liabilities for goods and services provided to the group prior to the end of the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method. Annual Report 2021 Consolidated ﬁnancial statements 31 Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates. Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Employee benefits For defined contribution plans, the group pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The group has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available. Contributed equity Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are recognised as a deduction, net of tax, from the proceeds. On the repurchase of treasury shares, the purchase amount including directly attributable costs are recognised as a change in equity. Purchased shares are classified as treasury shares and reduce total equity. When treasury shares are sold, the received amount is recorded as an increase in equity, and the subsequent gain on the transaction is recognised in share premium. Dividends Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period. Earnings per share Basic earnings per share is calculated by dividing: • the profit attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares • by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year and excluding treasury shares ( note 20 ). Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to consider: • the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and • the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares. Rounding of amounts All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousand currency units unless otherwise stated. Annual Report 2021 Consolidated ﬁnancial statements 32 Note 3 Segments Segment information The group’s management examines the group’s performance both from a product and services perspective and has identified three reportable segments of its business: Energy - Help customers master the energy transition by enabling end-to-end optimisation of the green energy value-chain by offering software solutions and consulting services related to forecasting and optimsation of the different energy markets. Power grid - Enable power distributors to support electrification of society by unlocking flexibility and digital management of the power grid. The group offer both software solutions and consulting services. Infrastructure - Deliver flexible capabilities for digital water management, consisting of both sofware solutions and consulting services. Help automate processes and machines for the construction industry. In order to asses the performance of the operating segments, the group’s management uses a measure of adjusted earnings before interest, tax, depreciation and amortisation (adjusted EBITDA, see below). Compared to EBITDA, Non-recurring items - items that are not part of the ordinary business, such as IPO related costs, M&A activities and costs related to the cyber-incident. In addition, external costs related to implementation of corporate back-office cloud-based systems (e.g. ERP) are considered non-recurring. In accordance with IFRS IC agenda decision (Configuration or Customisation Costs in a Cloud Computing Arrangement) from April 2021, these costs have not been capitalised, as they previously would have been. In addition the key performing indicators recurring revenue growth, recurring revenue (as percentage of total revenues), saas revenue growth (saas) and saas revenue (as a percentage of total revenues) are assessed each month. The other segments and eliminations section includes the elimination of inter- segment sales. Segment data for the years ended 31 December 2021 and 2020 are presented below. The measurement basis of segment profit is net operating income. Note 3 continues on next page Note 2 Key sources of estimation uncertainty, judgments and assumptions The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgement in applying the group’s accounting policies. This note provides an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be wrong. Detailed information about each of these estimates and judgements is included in other notes together with information about the basis of calculation for each affected line item in the financial statements. The areas involving significant estimates or judgements are: • Estimated goodwill impairment – note 12 • Recognition of revenue over time– note 1 • Provision for loss on contracts– note 4 • Estimated useful life of intangible asset – note 12 • Recognition of deferred tax asset for carried-forward tax losses – note 7 Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances. Annual Report 2021 Consolidated ﬁnancial statements 33 Amounts in NOK 1000 Energy Power grid Infra- struc- ture Other seg- ments and eliminations Total Full year 2021 Operating revenues 595 020 248 849 196 623 -1 417 1 039 075 Other income 6 473 9 154 4 378 1 598 21 603 Total revenues and other income 601 493 258 003 201 001 181 1 060 678 Materials and consumables used 88 219 46 462 24 464 0 159 145 Employee benefit expenses 286 683 132 875 94 107 0 513 665 Other operating expenses 102 456 46 583 25 470 0 174 509 Adjusted EBITDA 124 135 32 083 56 960 181 213 359 Non-recurring items 38 218 25 374 11 642 75 234 EBITDA 85 917 6 709 45 318 181 138 125 Depreciation and amortisation 54 297 18 390 19 236 0 91 923 Impairment 1 174 0 1 174 Net operating income/(loss) 30 447 -11 681 26 082 181 45 028 Amounts in NOK 1000 Energy Power grid Infra- structure Other seg- ments and eliminations Total Full year 2020 Revenues third party and other income 459 530 236 028 201 511 -5 203 891 866 Total revenues and other income 459 530 236 028 201 511 -5 203 891 866 Materials and consumables used 82 280 50 319 25 186 -4 157 782 Employee benefit expenses 218 910 87 672 103 555 12 300 422 437 Other operating expenses 61 292 40 596 19 797 -6 369 115 317 Adjusted EBITDA 97 047 57 441 52 972 -11 130 196 330 Non-recurring items 12 000 36 350 48 350 EBITDA 85 047 21 091 52 972 -11 130 147 980 Depreciation and amortisation 35 133 14 923 14 961 0 65 017 Impairment 1 004 1 004 Net operating income/(loss) 48 911 6 168 38 011 -11 130 81 960 Note 3 Segments cont. The entity headquarter is located in Norway. The amount of its revenue from external customers, broken down by location of the companies in the group is shown in the below table. Amounts in NOK 1000 2021 2020 Norway 666 426 612 892 Europe 366 600 278 974 Rest of the world 6 049 0 Operating revenues 1 039 075 891 866 Annual Report 2021 Consolidated ﬁnancial statements 34 Note 4 Revenue from contracts with customers Accounting principles and information related to external customers are described in note 1 . There are no customers that represents 10% or more of the Group’s total revenues on an annual basis. Disaggregation of revenue from contracts with customers The group derives revenue from the transfer of goods and services over time and at a point in time in the following major product and service lines: Amounts in NOK 1000 Energy Power grid Infra- structure Other segments and eliminations Total 2021 Segment revenue 601 493 258 003 201 001 181 1 060 678 Revenue from external customers 601 493 258 003 201 001 181 1 060 678 Timing of revenue recognition At a point in time 184 248 43 35 26 184 352 Over time 417 245 257 960 200 966 155 876 326 Total 601 493 258 003 201 001 181 1 060 678 2020 Segment revenue 459 530 236 028 201 511 -5 203 891 866 Revenue from external customers 459 530 236 028 201 511 -5 203 891 866 Timing of revenue recognition At a point in time 147 651 147 651 Over time 311 879 236 028 201 511 -5 203 744 215 Total 459 530 236 028 201 511 -5 203 891 866 Assets and liabilities related to contracts with customers The timing of revenue recognition, billings and cash collections results in billed trade receivables, unbilled receivables (contract assets), and prepayments and deposits from customers (contract liabilities). The table below shows the amounts of contract assets and contract liabilities at year end related to ongoing projects. Amounts in NOK 1000 2021 2020 Trade receivables 371 527 213 957 Contract assets 65 595 39 335 Contract liabilities 48 688 55 917 The change in contract liability mainly relates to billing of maintenace services in the energy segment, which cannot be recognised as revenue at year end. The Group considers on a regular basis whether there exists any onerous contracts. In case of any onerous contracts provisions for loss regarding the remaining period on the contracts are recognised in the period the current period. The Group has one onerous contract related to a specific project, provision for loss are shown in the table below: Amounts in NOK 1000 2021 2020 Balance at 1 January 10 668 2 500 Changes in expected losses (loss rates) and outstanding receivables (volume) 33 758 11 168 Realised losses during the period (-) -13 308 -3 000 Balance at 31 December 31 118 10 668 Annual Report 2021 Consolidated ﬁnancial statements 35 Note 5 Remuneration and employee beneﬁt Amounts in NOK 1000 2021 2020 Salaries 555 602 399 511 Social security contributions 55 681 53 121 Pension costs 29 788 24 333 Capitalisation R&D -104 161 0 Other benefits 12 400 -6 179 Total employee benefit expenses 549 310 470 787 Average number of employees 707 594 Amounts in NOK 1000 2021 2020 Present value of funded liabilities 22 078 23 083 Fair value of pension assets -40 142 -37 705 Present value of net liabilities -18 064 -14 622 Of which presented as pension assets 18 064 14 622 Change in recognised net liability for defined-benefit pensions Net funded defined-benefit pension liability as at 1 January -14 622 -18 776 Paid-in contributions -3 921 -1 204 Paid out from the scheme 5 450 Actuarial (gains) losses from other comprehensive income -805 Costs of defined-benefit schemes 479 712 Net liability for defined-benefit schemes as at 31 December -18 064 -14 622 Costs recognised in the income statement Costs relating to this period’s pension entitlements 139 806 Interest on the liabilities 380 511 Expected return on pension plan assets -467 -605 Recognised employers’ contributions 427 Effect of partial discontinuation of Board pensions Expenses from defined benefit plans 479 712 Costs of defined-contribution pension schemes 29 309 23 714 Net interest on pension liabilities transferred to finance -93 Total pension costs 29 788 24 333 Annual Report 2021 Consolidated ﬁnancial statements 36 Note 6 Other operating expenses Amounts in NOK 1000 2021 2020 Contractors 14 801 0 Maintenance property, plant and equipment 2 048 298 Premises, service and office costs 33 287 32 593 Audit and other fees 69 220 6 059 Travelling costs, indirect 5 010 6 286 Sales and marketing costs 2 994 3 508 Insurances 1 874 1 360 ICT costs 48 099 28 606 Realised bad debts 593 455 Other direct costs 18 937 36 153 Total operating expenses 196 863 115 317 Remuneration to auditor Statutory audit 5 194 2 390 Other assurance services 350 92 Tax advicsory 338 106 Other non-audit services 2 187 414 Total remuneration to auditor 8 069 3 002 Remuneration to auditor also include services related to equity transactions. Note 7 Income tax The tax rate was 22% in 2020 and 2021. The 22% tax rate was used to calculate Deferred tax assets and Deferred tax liabilities as at 31 December 2021. Tax loss carry forward are related to Volue ASA, Volue Market Services AS and Volue Industrial IoT AS. In Market Service most of the tax loss carry forward is not recognised. Amounts in NOK 1000 2021 2020 Tax payable on ordinary income 20 516 22 102 Adjustment for previous years -18 -3 136 Current tax expense 20 498 18 966 Effect of change in temprary differences -8 614 -3 891 Total deferred tax expense -8 614 -3 891 Total tax expense in the income statement 11 884 15 075 Reconciliation of effective tax rate Profit / (loss) before income tax 39 503 75 333 Tax based on current ordinary tax rate 15 924 15 999 Effect of different tax rates abroad 140 -2 421 Effect of non-deductible expenses 3 772 1 894 Effect of non-taxable income -7 945 -2 110 Effect of unrecognised tax loss carryforward -1 761 1 845 Effect of changed tax rates Effect of changed tax assessments for previous years 1 753 -133 Total tax expense 11 884 15 075 Effective tax rate 30% 20% Note 7 continues on next page Annual Report 2021 Consolidated ﬁnancial statements 37 Amounts in NOK 1000 Assets Liabilities Net assets 2021 Property, plant and equipment 1 087 -15 440 -14 353 Goodwill, intangible assets 7 509 -20 041 -12 532 Construction contracts 0 -2 167 -2 167 Inventories 0 0 0 Overdue receivables 242 0 242 Leases 4 034 -107 3 927 Gains and losses account 0 0 0 Provisions 66 0 66 Other items 36 -2 086 -2 050 Employee benefits 593 -2 219 -1 626 Tax loss carryforward 4 004 0 4 004 Unrecognised tax loss carryforward 0 0 0 Recognised tax loss carryforward 4 004 0 4 004 Deferred tax asset/liability 17 570 -42 061 -24 490 Offsetting of assets and liabilities -12 861 12 861 Net deferred tax asset/liability 4 709 -29 200 -24 490 2020 Property, plant and equipment 1 008 -4 004 -2 995 Goodwill, intangible assets -298 -18 619 -18 918 Construction contracts 0 -2 427 -2 427 Inventories 182 0 182 Overdue receivables 616 0 616 Leases 357 0 357 Gains and losses account 0 0 0 Provisions 0 -187 -187 Other items 0 -1 942 -1 942 Employee benefits 439 -1 063 -624 Tax loss carryforward 12 684 260 12 944 Unrecognised tax loss carryforward -5 440 0 -5 440 Recognised tax loss carryforward 7 244 260 7 504 Deferred tax asset/liability 9 548 -27 983 -18 435 Offsetting of assets and liabilities -1 598 1 598 Net deferred tax asset/liability 7 950 -26 385 -18 435 Note 7 Income tax cont. Note 8 Inventories Inventory stock Amounts in NOK 1000 2021 2020 Raw materials 15 814 12 781 Work in progress 978 356 Finished goods 3 103 0 Total inventories 19 895 13 137 Write-down There have been no write-downs in the period. Annual Report 2021 Consolidated ﬁnancial statements 38 Note 10 Cash and cash equivalents Amounts in NOK 1000 2021 2020 Total cash and cash equivalents 404 390 433 527 Restricted cash 89 237 35 063 Restricted cash are related to tax funds and to trading, which is a part of Volue Market Services AS’ business. Note 9 Trade and other receivables Trade receivables Amounts in NOK 1000 2021 2020 Trade receivables from contracts with customers 373 165 215 762 Loss allowence -1 638 -1 805 Total 371 527 213 957 Write-down Amounts in NOK 1000 2021 2020 Balance at 1 January -1 805 -1 900 New write-downs recognised during the year 204 -360 Realised loss during the period -37 455 Balance at 31 December -1 638 -1 805 For more information about credit risk and write-downs, see note 16 . Other receivables Amounts in NOK 1000 2021 2020 Other receivables 115 919 48 014 Prepayments 32 412 34 342 Total 148 331 82 356 Total trade and other receivables 519 858 296 312 Annual Report 2021 Consolidated ﬁnancial statements 39 Amounts in NOK 1000 Vehicles, machinery and equipment Buildings and land RoU assets Total Year ended 31 December 2021 Cost at 1 January 2021 135 538 3 312 187 654 326 504 Additions 13 026 133 13 159 Aquisitions through business combinations 960 960 Disposals 0 Disposal of companies and businesses 0 Change in RoU 5 611 5 611 Exchange differences 977 -362 615 Cost at 31 December 2021 150 501 3 446 192 902 346 849 Accumulated depreciation at 1 January 2021 112 960 0 51 051 164 010 Depreciation 10 687 58 29 720 40 465 Impairment 606 606 Aquisitions through business combinations 0 Disposal of companies and businesses 0 Change in RoU -511 -511 Exchange differences cost 1 364 -60 1 304 Accumulated depreciation at 31 December 2021 125 617 58 80 199 205 874 Carrying amount at 31 December 2021 24 883 3 388 112 703 140 975 Property, plant and equipment is recognised at historical cost less depreciation. Depreciation is calculated using the straight-line method to allocate the cost or revalued amounts of the assets, net of their residual values, over their estimated useful lives as follows: • Buildings 25-40 years • Machinery 3-15 years • Vehicles 3-5 years See note 1 for the other accounting policies relevant to property, plant and equipment. More information regarding right of use assets are presented in note 14 Leases. Right of use assets is mainly related to property. Note 11 Property, plant and equipment Amounts in NOK 1000 Vehicles, machinery and equipment Buildings and land RoU assets Total Year ended 31 December 2020 Cost at 1 January 2020 125 294 3 312 159 590 288 196 Additions 12 647 30 075 42 722 Aquisitions through business combinations 6 813 6 813 Disposals -586 -586 Disposal of companies and businesses -8 727 -2 011 -10 738 Exchange differences 97 97 Cost at 31 December 2020 135 538 3 312 187 654 326 504 Accumulated depreciation at 1 January 2020 106 333 0 23 834 130 167 Depreciation 7 866 25 401 33 267 Impairment 1 004 1 004 Aquisitions through business combinations 5 881 5 881 Disposal of companies and businesses -8 727 1 816 -6 911 Exchange differences cost 602 602 Accumulated depreciation at 31 December 2020 112 960 51 051 164 010 Carrying amount at 31 December 2020 22 578 3 312 136 603 162 494 Annual Report 2021 Consolidated ﬁnancial statements 40 Note 12 Intangible assets Amounts in NOK 1000 Goodwill Other intangible assets R & D Total Year ended 31 December 2020 Cost at 1 January 2020 152 405 214 171 247 772 614 348 Additions 2 502 4 094 85 844 92 440 Aquisitions through business combinations 103 911 63 150 167 061 Exchange differences -657 -452 -1 109 Cost at 31 December 2020 258 161 280 964 333 616 872 741 Accumulated amortisation at 1 January 2020 7 609 181 057 187 992 376 658 Amortisation 4 138 28 993 33 131 Exchange differences cost -21 -21 Accumulated amortsation and impairment at 31 December 2020 7 609 185 173 216 985 409 767 Carrying amount at 31 December 2020 250 552 95 792 116 631 462 975 Year ended 31 December 2021 Cost at 1 January 2021 258 161 280 964 333 616 872 741 Additions 6 309 97 916 104 225 Aquisitions through business combinations 20 182 9 028 7 158 36 368 Exchange differences -5 754 -3 139 -337 -9 230 Cost at 31 December 2021 272 589 293 162 438 353 1 004 104 Accumulated amortisation at 1 January 2021 7 609 185 173 216 985 409 767 Amortisation 10 268 40 511 50 779 Impairment 1 174 73 1 247 Exchange differences cost -209 -8 -217 Accumulated amortsation and impairment at 31 December 2021 8 783 195 305 257 489 461 576 Carrying amount at 31 December 2021 263 806 97 858 180 865 542 528 Impairment test for goodwill and other intangible assets Goodwill is monitored by management at the level of the three operating segments identified in note 3 . A segment-level summary of the goodwill allocation is presented below: Amounts in NOK 1000 Energy Power grid Infrastructure Total Goodwill at year end 2021 178 224 61 861 23 721 263 806 Goodwill at year end 2020 164 970 61 861 23 721 250 552 Intangible assets with definite useful life consists of internally generated intangible assets arising from development costs, licenses for software as well as added values related to customer relationships. Useful life varies between four and ten years. The group tests whether goodwill and other intangible assets with indefinit useful life has suffered any impairment on an annual basis. For the 2021 reporting periods, the recoverable amount of the groups of cash-generating units (CGUs) was determined based on value-in-use calculations which require the use of assumptions. The calculations use cash flow projections based on financial budgets approved by management. If there are indications of impairment for the intangible assets with defined useful life, an impairment test is performed. For 2021, there are no such indications. Note 12 continues on next page Annual Report 2021 Consolidated ﬁnancial statements 41 Volue Technology AS The return requirement for total capital (WACC before tax) is set at 10.5%. When calculating the return requirement, it is taken into account that the Group’s earnings are in EUR and USD and that the business is cyclical. Risk-free interest is set at 1.5% and terminal growth is set at 2%. A sensitivity analysis based on unilateral change in estimated future EBITDA shows that a reduction of 81% may result in impairments. Volue Insight AS The return requirement for total capital (WACC before tax) is set at 9.5%. Risk-free interest is set at 1.5% and terminal growth is set at 2%. A sensitivity analysis based on unilateral change in estimated future EBITDA shows that a reduction of 87% may result in impairments. Volue Market Services AS The return requirement for total capital (WACC before tax) is set at 10%. Risk- free interest is set at 1.5% and terminal growth is set at 2%. A sensitivity analysis based on unilateral change in estimated future EBITDA shows that a reduction of 63% may result in impairments. Volue Industrial IOT AS The return requirement for total capital (WACC before tax) is set at 10%. Risk- free interest is set at 1.5% and terminal growth is set at 2%. A sensitivity analysis based on unilateral change in estimated future EBITDA shows that a reduction of 72% may result in impairments. Volue Germany GmbH (Likron GmbH) The return requirement for total capital (WACC before tax) is set at 10%. When calculating the return requirement, it is taken into account that the Group’s earnings are in EUR and USD and that the business is cyclical. Risk-free interest is set at 1.5% and terminal growth is set at 2%. A sensitivity analysis based on unilateral change in estimated future EBITDA shows that a reduction of 33% may result in impairments. Note 13 Non-current receivables and investments Amounts in NOK 1000 2021 2020 Loan to employees 27 276 31 086 Other investments 2 024 688 Total non current receivables and investments 29 300 31 774 The loans to key management personnel are related to purchase of shares in Volue ASA and the shares are used as collateral according to the loan agreements. Interest rate for the loans is not below the threshold for making the loan a taxable benefit. At year end the interest rate was 1.3%. Note 12 Intangible assets cont. Annual Report 2021 Consolidated ﬁnancial statements 42 Note 14 Leases This note provides information for leases where the Group is a lessee. Amounts recognised in the balance sheet The balance sheet shows the following amounts relating to leases: Amounts in NOK 1000 2021 2020 Total right-of-use assets 112 703 136 603 Current lease liabilities 27 675 21 356 Non-current lease liabilities 87 495 117 475 Total lease liabilities 115 170 138 831 Amounts recognised in the statement of income The statement of income shows the following amounts relating to leases: Amounts in NOK 1000 2021 2020 Total depreciation charge right-of-use assets 29 720 25 401 Interest expense 4 357 4 724 The group has no variable rate leases. Amounts expenses in the statement of income related low value leases are immaterial to these financial statements. Note 15 Trade payables and other current liabilities Amounts in NOK 1000 2021 2020 Trade payables 350 686 146 633 Other current liabilities 384 437 304 930 Total 735 122 451 563 Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their short-term nature. Specification of other current liabilities Amounts in NOK 1000 2021 2020 Publix taxes 62 887 61 960 Loans to related parties 40 981 36 489 Accrued expenses 136 572 107 861 Paid in collatorals from customers 29 026 62 585 Earn-out 2020 (see note 21 ) 57 253 32 200 Other current liabilities 57 717 3 834 Total 384 437 304 930 Annual Report 2021 Consolidated ﬁnancial statements 43 Note 16 Financial risk and ﬁnancial instruments This note explains the group’s exposure to financial risks and how these risks could affect the group’s future financial performance. Current year profit and loss information has been included where relevant to add further context. Volue’s Board of Directors and Executive Management conduct risk assessments relating to various dimensions and aspects of operations, to verify that adequate risk management systems are in place. The Group’s risk management is predominantly controlled by the finance departments in the group companies, under policies approved by the Board of Directors. The responsible identifies, evaluates, and hedges financial risks in close co-operation with the Group’s operating units. The Board provides written principles for overall risk management, as well as policies covering specific areas, such as currency risk, interest rate risk and credit risk. Volue operates on an international level, and provides software solutions, platforms and related services within various market segments, including energy and electricity, infrastructure and construction. The Group’s operations may consequently be affected by global economic and political conditions in the markets in which it operates, especially in the Nordics and DACH region which the Group considers as its most important markets. The outlook for the world economy remains subject to uncertainty. Downturns in general economic conditions, whether globally or in the specific regional and/or end markets segments in which the Group operates, can result in reduced demand for, and lower prices of, the Group’s software solutions and platforms, which could have a material negative impact on the Group’s revenues, profitability and growth prospects. Market Risk Both the technology market and the energy market are highly competitive, especially in relation to software solutions and investment services offered to participants within the energy markets. Some of the Group’s competitors are large, sophisticated and well-capitalised technology and software companies that may have greater financial, technical and marketing resources than the Group. Furthermore, these competitors may have larger research and development expenditures, and thereby, have a greater ability to fund product and system research and can respond more quickly to new or emerging technologies or trends in the energy market or changes in customer demands. Increased competition in the energy market could result in price reductions, loss of market share, reduced margins and fewer customer orders The Group’s software solutions, platforms, analyses, and trading and management services are based on complex software technology. The Group sets high-quality and security standards for its products and services, but it is possible that software solutions and platforms may contain errors or defects or otherwise not perform as expected. Although the Group carries out control procedures for testing, monitoring, securing and developing its solutions and platforms, there is a risk that these procedures may fail to test for all possible conditions for use, or identify all defects or errors in the specific software used in its solutions and platforms. Defects or other errors or failures could occur in the actual solutions or within the software or platform in which the solutions and related services are based. Such damage may cause material liability claims against the Group, as well as significant costs for the Group. Price risk The Group’s business is subject to price risk. There is no guarantee that the Group will be able to obtain the expected prices for its software solutions,platforms, analyses, and trading and management services, and any change in the market conditions, including in the global technology and energy markets or in a specific regional and/or end markets in which the Group operates, could lead to lower sales prices or volumes of the Group’s products and services. If expected prices for products and services are not obtained or the Group experiences lower sales volumes, this may adversely impact the Group’s business, financial position and profits. Currency risk The Group’s business is subject to currency and exchange rate risk. The foreign exchange rate risk for the Group relates to the fact that the Group’s business transactions and operations are made in several currencies other than NOK, including EUR, SEK, DKK, PLN and CHF. The Group practice hedge accounting only on a few project and the related amounts are immaterial, hence no further information about this. The overall currency risk for the group is considered to be low, due to both revenues and cost in currency reflecting a low currency risk for the group. Note 16 continues on next page Annual Report 2021 Consolidated ﬁnancial statements 44 Fair value hierarchy To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into three levels. Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and equity securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the group is the current bid price. These instruments are included in level 1. Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities. All financial assets and liabilites are measured at amortised cost, except for the financial instruments below. Amounts in NOK 1000 Level 1 Level 2 Level 3 Total 2021 Financial assets Financial assets at fair value through profit or loss (FVPL) - - Total finacial assets at fair value - - - - Finacial liabilities Earn-out (see note 21 ) - - 57 253 57 253 Total financial liabilities - - 57 253 57 253 Amounts in NOK 1000 Level 1 Level 2 Level 3 Total 2020 Financial assets Financial assets at fair value through profit or loss (FVPL) 10 000 10 000 Total finacial assets at fair value - 10 000 - 10 000 Finacial liabilities Earn-out (see note 21 ) - - 60 700 60 700 Total financial liabilities - - 60 700 60 700 The financial assets are investments in interest fund. Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. The group maintains flexibility in funding by maintaining availability under committed credit lines. The group’s main interest rate risk arises from bank overdrafts, which expose the group to cash flow interest rate risk. At year end all bank overdrafts agreements are using NIBOR as fixed rate. The amounts are carried at amortised cost. The Group had significant amounts of cash and cash equivalents on accounts with floating interest rate, hence exposure to interest rate risk. Amounts in NOK 1000 Carrying amount Contractual cash flows 6 months or less 6 to 12 months 1 to 2 years 2 to 5 years Over 5 years 2021 Obligations from leases 115 170 116 918 10 923 24 569 26 873 29 368 25 185 Bank overdraft 17 529 17 529 17 529 - - - - Trade and other payables 350 686 350 686 350 686 - - - - Other curr. liabilities 451 709 451 709 399 921 51 788 - - - Other non-current liabilities 14 505 14 505 4 795 9 710 Note 16 continues on next page Note 16 Financial risk and financial instruments cont. Annual Report 2021 Consolidated ﬁnancial statements 45 Credit risk Credit risk arises from cash and cash equivalents, contractual cash flows of debt investments carried at amortised cost, at fair value through other comprehensive income (FVOCI) and at fair value through profit or loss (FVPL), favourable derivative financial instruments and deposits with banks and financial institutions, as well as credit exposures related to sales, including outstanding receivables. The Group has a credit risk policy and is follwoing up credit risk on a regular basis. Trade receivables Amounts in NOK 1000 External customer rec not due External customer rec 1-30 days past due External customer rec 31-60 days past due External customer rec 61-90 days past due External customer rec > 90 days past due Trade accounts receivable 2021 Outstanding trade receivables 312 173 46 597 6 721 4 286 3 388 373 165 Provision for losses 0 0 -350 -350 -938 -1 638 2020 Outstanding trade receivables 180 238 30 566 3 563 1 395 0 215 762 Provision for losses -700 -1 105 -1 805 Note 16 Financial risk and financial instruments cont. Provision for losses Provisions for losses are based on individual assessment of each item and customer. Expected loss in categories without any provisions made is based on the assumption that there are not risk of any material losses. Amounts in NOK 1000 2021 2020 Balance at 1 January -1 805 -1 900 Changes in expected losses (loss rates) and outstanding receivables (volume) 204 -360 Realised losses during the period (-) -38 455 Balance at 31 December -1 638 -1 805 Annual Report 2021 Consolidated ﬁnancial statements 46 Note 17 Borrowings This note provides information on the contractual terms of the Group’s interest- bearing loans and borrowings. For more information on the Group’s interest rate risk and foreign exchange risk see Note 16 . Amounts in NOK 1000 2021 2020 Loans secured by pledged assets Bank overdraft 17 529 3 695 Total borrowings 17 529 3 695 The group has a borrowing facility on NOK 200 million that is unpledged. In addition, the group has a warranty in one of its subsidiaries on NOK 200 million that is secured through trade receivables. Amounts in NOK 1000 2021 2020 Assets pledged for borrowing facility and warranties Other property - 3 000 Inventories - 44 989 Trade receivables 248 729 116 224 Total security for borrowing facility and warranties 248 729 164 213 The table below reconciles the movement in financial liabilites to cash flow from financing activities. Short-term borrowings Long-term borrowings Lease liabilities Total financial liabilities Amounts in NOK 1000 2021 2020 2021 2020 2021 2020 2021 2020 Balance at 1 January 3 695 64 346 138 831 134 457 142 527 198 804 Cash Flow 3 636 -60 651 5 640 -30 940 -25 506 -21 664 -86 157 Non cash changes New lease liabilities recognised/implementation of IFRS 16 5 611 30 075 5 611 30 075 Other non-cash changes 10 198 1 668 -195 11 866 -195 Balance at 31 December 17 529 3 695 5 640 0 115 170 138 831 138 340 142 527 Annual Report 2021 Consolidated ﬁnancial statements 47 Note 18 Finance items Amounts in NOK 1000 2021 2020 Interest income 2 665 6 800 Currency exchange income 15 527 5 803 Other finance income 181 4 567 Total Finance income 18 373 17 169 Interest expense 1 509 10 091 IFRS 16 interest 4 357 4 724 Currency exchange expense 15 618 7 209 Other finance cost 2 342 1 561 Interest expense 72 213 Total finance cost 23 898 23 797 Net finance items -5 525 -6 627 Annual Report 2021 Consolidated ﬁnancial statements 48 Note 19 Share information Amounts in NOK 1000 2021 2020 Ordinary shares 143 869 714 143 577 626 Share capital 57 548 57 431 Share premium 4 440 567 4 434 900 At 31 December 2021 there were 143 869 714 ordinary shares each with a par value of NOK 0.40. They entitle the holder to participate in dividends, and to share in the proceeds of winding up the company in proportion to the number of and amounts paid on the shares held. Changes in share capital Date Share capital Share premium Share capital 1 January 2021 01.01.2021 57 431 4 434 900 Share capital increase 22.12.2021 83 10 184 Share capital increase 28.12.2021 34 3 872 Transactions in own shares -8 390 Share capital at year end 2021 57 548 4 440 567 Dividends There are no paid out dividends in 2021. Major shareholders Investor Number of shares % of major shareholders % of total Country Arendals Fossekompani ASA 86 316 779 73.33% 60.03% Norway Fidelity Investments (FMR) 13 942 086 11.85% 9.70% USA Swedbank Robur Funds 8 379 750 7.12% 5.83% Sweden Invesco 3 021 672 2.57% 2.10% USA TIN Funds 1 600 000 1.36% 1.11% Sweden AS Tanja (Andenæsgruppen) 1 518 049 1.29% 1.06% Norway Ulfoss Invest AS 1 470 987 1.25% 1.02% Norway Havfonn AS 1 456 790 1.24% 1.01% Norway Other shareholders (holding less than 1%) 26 163 601 18.14% Total all shareholders 143 869 714 100.00% 100.00% Annual Report 2021 Consolidated ﬁnancial statements 49 Note 20 Earnings per share Basic earnings per share are based on profit attributable to the equity holders of the parent and the weighted average number of outstanding ordinary shares. Amounts in NOK 1000 2021 2020 Net profit for the year 27 619 99 061 Attributable to non-controlling interests -205 16 829 Attributable to ordinary shares 27 825 82 232 Profit from continuing operations 27 619 60 258 Attributable to non-controlling interests -205 14 936 Attributable to ordinary shares 27 825 45 322 Profit from discontinued operation 0 38 803 Attributable to non-controlling interests 0 1 894 Attributable to ordinary shares 0 36 910 Weighthed number of ordniary shares, basic and diluted 143 582 855 107 596 403 Number of shares end of period 143 869 714 143 577 626 Basic and diluted earnings per share 0.19 0.76 Basic and diluted earnings per share from continuing operations 0.19 0.42 Basic and diluted earnings per share from discontinued operations 0.00 0.34 Annual Report 2021 Consolidated ﬁnancial statements 50 Assets and liabilities recognised as a result of the acquisition Amounts in NOK 1000 Intangible assets 17 700 Fixed assets 1 800 Investments 8 200 Trade receivables 5 400 Other receivables 8 600 Cash and cash equivalents 4 900 Trade payables -1 600 Other current liabilities -35 100 Deferred tax liability -5 000 Net assets acquired 4 900 Purchase price shares in Procom 23 153 Goodwill 18 253 The PPA is final and there has not been any changes in fair value calculation. Procom had a loss of 1 682 TNOK in 2021. In the transaction of Procom GmbH the automation business was carved out as part of the transaction structure, and prior to the transaction the company operated as one company. Proforma figures for revenues and loss has not been estimated. Note 21 continues on next page Note 21 Business combinations and transactions with non-controlling interests Transactions in 2021 Volue Energy Gmbh (Procom GmbH) On 1 October 2021 Volue ASA acquired 100% of the issued share capital of Procom GmbH. Procom is a strategic acquisition for Volue, cementing our European position in an increasingly important of market footprint in the DACH region. The company especially focus on optimalisation solution for especially large and mid size customers. Procom will be a part of the Energy segment. Details of the purchase consideration, the net assets acquired and goodwill are as follows; Purchase consideration Amounts in NOK 1000 Cash paid 14 000 Ordinary shares issued 3 843 Holdback 5 310 Total purchase consideration 23 153 There was used a seller credit related to the share issue. Remaning holdback is related to escrow accounts and adjustment related to performance of Procom GmbH towards 30 June 2022. The performance related payment is related to revenues of Procom GmbH from 1 July 2021 until 30 June 2022, and postive or negative deviation from baseline will give adjustment on the purchase price. There are no other earn-out mecanisms or other deffered payment after 30 June 2022. Annual Report 2021 Consolidated ﬁnancial statements 51 Transactions in 2020 The current legal structure of the Group was created on 15 September 2020 when AFK transferred its shareholdings in four subsidiaries through contributions in kind to Volue. On 21 October 2020 (shortly after Volue’s listing on Euronext Growth, Volue offered to buy all shares from the non-controlling shareholders of the four subsidiaries. The selling shareholders could choose between settlement in cash and shares in Volue. The effect of the transactions are summarised in the table below. Company Ownerhip from contribution in kind Sept. 2020 Ownership 31.12.2020 Change in ownerhsip Of which settled in cash Of which settled in shares Volue Technology AS 96.00% 99.82% 3.82% 109 134 5 179 Volue Market Service AS 96.70% 99.98% 3.28% 3 808 257 Volue Industrial IoT AS 69.00% 94.76% 25.76% 44 762 1 799 Volue Insight AS 90.50% 100.00% 9.50% 81 167 1 705 Company Carrying value aquired non- controlling interest derecognised Effect on equity attributable to controlling shareholders Cash paid / total effect on consolidated equity Volue Technology AS -4 909 -103 414 108 323 Volue Market Service AS -1 707 -2 101 3 808 Volue Industrial IoT AS -16 058 -28 704 44 762 Volue Insight AS -2 846 -78 321 81 167 Total -25 520 -212 540 238 060 Note 21 Business combinations and transactions with non-controlling interests cont. Likron Gmbh On 19 November 2020 Volue ASA acquired 100% of the issued share capital of Likron Gmbh, the leading algorithmic power trading software provider in Germany. Likron is a strategic and significant acquisition for Volue, cementing our European position in an increasingly important intraday power trading market. Likron is a spearhead for further internationalisation of Volue in the Energy market. The acquisition significantly increase Volue’s market penetration in the DACH region and strengthens our presence in Germany, which is considered the leader in the energy transition. Likron will be a part of the Energy segment. Details of the purchase consideration, the net assets acquired and goodwill are as follows: Purchase consideration Amounts in NOK 1000 Cash paid 66 618 Ordinary shares issued 28 593 Earn out 2020 32 200 Earn out 2021 45 800 Total purchase consideration 173 211 There was used a seller credit related to the share issue. Earn-out 2020 and 2021 are based on Likron reaching threshold revenue targets indicating ARR growth. Payment based on 60% cash and 40% shares based on full earn-out. Based on the performance above expecations in 2021 the total earn-out payment has increased with 17 304 TNOK. The increase in earn-out has been recoginaised in the profit and loss as other loss. In addition to the consideration disclosed above, the seller is entitled to a deferred consideration that will be paid if the current management will stay in their position until the end of 2022. Deferred consideration will be recognised as employee expenses. The maximum deferred consideration is NOK 21.2 million (EUR 2.0 million). Amounts in NOK 1000 Purchase price shares in Likron 173 211 Goodwill 103 911 Annual Report 2021 Consolidated ﬁnancial statements 52 Note 22 Subsidiaries Investor Ownership held by the group Ownership held by the non-controlling interests Domicile Volue Denmark ApS 94.76% 5.24% Denmark Volue Technology Danmark A/S 100.00% 0.00% Denmark Volue Germany GmbH 100.00% 0.00% Germany Volue Energy GmbH 100.00% 0.00% Germany Volue Gmbh 100.00% 0.00% Germany Volue Insight Gmbh 100.00% 0.00% Germany Volue Industrial IoT AS 94.76% 5.24% Norway Volue Insight AS 100.00% 0.00% Norway Volue Market Service AS 100.00% 0.00% Norway Volue Technology AS 100.00% 0.00% Norway Volue Sp. Z.o.o 100 .00% 0.00% Poland Volue AB 100.00% 0.00% Sweden Volue In Situ AB 94.76% 5.24% Sweden Volue AG 100.00% 0.00% Switzerland Volue Enerji cozumleri 100.00% 0.00% Turkey Annual Report 2021 Consolidated ﬁnancial statements 53 Summarised balance sheet information No balance sheet items towards dicontinuted operations was held by the group at 31 December 2021. Information about transactions between continued and discontinued operations Amounts in NOK 1000 2021 2020 Revenues 4 200 expenses 4 150 Net finance income 0 Income tax 0 Profit/(loss) 50 Entities within continued operation has sold goods and services to discontinued operations. Revenue and related expences from the transactions above is elimated, and therefore not included in revenue from continued operations. Note 23 Discontinued operations Summarised information about profit from continued operations Amounts in NOK 1000 2021 2020 Revenue 181 092 Expenses -171 679 Income tax -2 076 Profit/(loss) from discontinued operations before gain on disposal 7 337 Gain on disposal 31 466 Profit/(loss) from dicontinued operations 38 803 Attributable to equity holders of the company 27 934 Attributable to non-controlling interests 10 869 Summarised cash flow infomation Amounts in NOK 1000 2021 2020 Net cash flow from operating activities -20 290 Net cash flow from investing activities 61 109 Net cash flow from financing activities -26 170 Specification of cash flow from investing activities Proceeds from sale of shares in Scanmatic Electro 0 61 109 Net cash flow from investing activities 0 61 109 Annual Report 2021 Consolidated ﬁnancial statements 54 Note 24 Related parties At year end Arendal Fossekompani (AFK) owned 86.316.779 shares, representing 60% of the total number of shares in Volue. Board of Directors compensation 2021 and number of shares owned 31 December 2021 Name Title Board of Directors remunerated Number of shares in Volue Ørjan Svanevik Chairman - 7 500 Henning Hansen Member of Board 300 42 857 Lars Peder Fosse Fensli Member of Board - 17 000 Christine Grabmaier Member of Board 324 - Ingunn Ettestøl Member of Board - 6 187 Annette Petra Maier Member of Board 84 - Anja Eva Schneider Member of Board 84 - Knut Ove Blichner Stenhagen Employee - Elected Board member 80 6 946 Vija Pakalkaite Employee - Elected Board member - 102 Kjetil Kvamme Employee - Elected Board member 80 - Name Title Fixed salary Paid bonus Pension Other benefit's Number of shares in Volue Loan from Volue Trond Straume CEO 4 070 3 518 80 245 546 715 9 128 Arnstein Kjesbu CFO 2 544 1 730 80 11 337 204 5 477 Ingeborg Gjærum CSO 1 550 207 80 4 85 714 1 460 Kevin Gjerstad CTO 1 500 863 80 7 - - Tom Darell EVP Energy 1 900 1 211 80 4 - - Lars Ove Johansen EVP Power Grid 1 806 854 80 5 128 571 2 191 Vigleik Takle CCO 1 850 - 80 4 128 571 2 191 Frode Solem EVP Infrastructure 1 575 1 172 223 11 128 571 2 191 Kim Steinsland EVP IIoT 1 606 471 80 3 171 429 2 921 Thale Kuvås Solberg CDO 1 320 65 80 8 21 875 - The CEO’s period of notice is six months, with a period of pay of 12 months after termination of employment if the CEO is dismissed by the company. The other members of the Group Executive have a period of notice of six months. Guidelines for pay and other remuneration of the executive management The purpose of Volue’s compensation and benefits policy is to attract personnel with the competence that the Group requires, develop and retain employees with key expertise and promote a long-term perspective and continuous improvement supporting achievement of Volue’s business goals. The general approach adopted in Volue’s policy is to pay fixed salaries and pensions in line market prices, while offering variable pay linked to results for bonus and long term incentive plan for share incentive program. (LTIP) a. Fixed elements b. Variable elements – annual bonus Executives in Volue participate in the Group’s central annual bonus program. The program has a maximum ceiling of 50% of the executive’s fixed salary. The basis for bonus payments is based on financial targets and performance strategic KPI’s. A “good performance” has been defined as the achievement of results in line with externally communicated financial targets. In addition, the Group has share-based incentive programs described in (c) below and a share option programs for key employees described in (d) below. For 2021 paid bonus contains for certain members of the ELT exit from LTIP agreement following incentiv system prior to the establishment of Volue. Note 24 continues on next page Annual Report 2021 Consolidated ﬁnancial statements 55 Note 25 Contingent liabilites The group had no contingent liabilities at 31 December 2021. Note 26 Subsequent events The adverse market conditions brought by the war in Ukraine is considered to have very limited impact on the business. Volue has terminated the contracts we have with our one Russian customer within the given notice periods. Note 27 Other income Other income relates to insurance settlement after cyber incident 5 May 2021. c. Shared incentive program On 13 October 2020, the Board of Directors of the Company resolved to establish a share incentive program for key employees of the Company. The share incentive program is based on a structure in which certain members of the Company’s Management and management of the Portfolio Companies are offered the opportunity to subscribe for Shares at a discounted rate, and where the Company will provide partial financing of their subscription of Shares under the share incentive program. The total number of Shares included in the share incentive program is 1,821,429. As part of the share incentive program, the key employees purchased Shares at a discount of 30% of the trading price of the Shares, subject to a lock-up undertaking of 36 months following the date of the purchase of the Shares. The company has provided loan financing for up to 75% of the purchase price of the Shares under the share incentive program, for a total of up to NOK 36 million. d. The share option plan is based on a structure in which the Company’s senior management and certain other key employees are granted share options in the Company. Each share option carries the right to acquire one share in the Company. The total number of share options that may be issued under the plan is 2,397,747 for the first year grant of options. 15% of the options shall be reserved for the Company’s Chief Executive Officer. The Chief Executive Officer is authorised to allocate the options reserved for the executive management team and other key employees and to determine who qualifies as a key employee in a strategic position. The share options will be granted over a three-year period, and the plan will be assessed annually for further grants. The share options vest three years after the date of grant and will lapse if not exercised within seven years following the date of grant. For the share options to vest, a minimum average share price development of 4.5% p.a is required. Upon any exercise of share options the Company may settle its obligations by selling the relevant number of shares or by payment in cash. For further information, see separate remuneration report publised at the companys website. Note 24 Related parties cont. 56 Annual Report 2021 Parent company ﬁnancial statements Parent company ﬁnancial statements Statement of income 57 Statement of other comprehensive income 57 Balance sheet 58 Statement of changes in equity 59 Statement of cash flows 59 Notes to the parent company financial statements Note 1 Accounting principles 60 Note 2 Revenue from contracts with customers 62 Note 3 Remuneration and employee benefit 62 Note 4 Other operating expenses 62 Note 5 Income tax 63 Note 6 Trade and other receivables 63 Note 7 Cash and cash equivalents 63 Note 8 Property, plant and equipment 64 Note 9 Non-current receivables and investments 65 Note 10 Leases 65 Note 11 Trade and other payables 66 Note 12 Finance items 66 Note 13 Share information 67 Note 14 Subsidiaries 67 Note 15 Related parties 68 Note 16 Contingent liabilites 69 Note 17 Subsequent events 69 Note 18 Other gains/losses 69 Note 19 Intercompany loans 70 Note 20 Current liabilities 70 Annual Report 2021 Parent company ﬁnancial statements 57 Statement of income For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Continuing operations Revenues 2 84 716 25 093 Employee benefit expenses 3 25 919 12 626 Employee benefit expenses 4 71 083 23 923 Other operating expenses 18 17 305 - EBITDA -29 591 -11 456 Depreciation and amortisation 8, 10 3 309 469 Net operating income/(loss) -32 900 -11 926 Finance income 12 36 700 215 Finance costs 12 2 873 2 451 Profit/(loss) before income tax 928 -14 162 Income tax expense 5 4 043 -2 137 Profit/(loss) for the period -3 115 -12 025 Statement of other comprehensive income For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Items that may be reclassified to statement of income Exchange differences on translation of foreign operations - - Changes on cash flow hedges - - Income tax related to these items - - Items that may be reclassified to statement of income - - Items that will not be reclassified to statement of income Remeasurements of post-employment benefint obligations - - Income tax relating to these items - - Items that will not be reclassified to statement of income - - Other comprehensive income for the period, net of tax - - Total comprehensive income for the period -3 115 -12 025 Annual Report 2021 Parent company ﬁnancial statements 58 Balance sheet For the year ended 31 December Amounts in NOK 1000 Note 2021 2020 Assets Non-current assets Property, plant and equipment 8 ,10 12 003 11 827 Investment in subsidiaries 14 4 348 487 4 307 745 Intra-group loans 19 7 975 5 000 Non-current receivables and investments 9 27 276 30 682 Deferred tax assets 5 3 040 7 084 Total non-current assets 4 398 782 4 362 338 Current assets Trade and other receivables 6 133 048 31 466 Cash and cash equivalents 7 87 115 177 675 Total Current assets 220 163 209 141 Total assets 4 618 945 4 571 479 Amounts in NOK 1000 Note 2021 2020 Equity and liabilities Equity 4 498 115 4 492 332 Share capital and share premium -92 Retained earnings -15 141 -12 025 Total equity 13 4 482 883 4 480 306 Non-current liabilities Other non-current liabilities - 28 500 Lease liabilities 10 5 603 9 072 Total non-current liabilities 5 603 37 572 Current liabilities Lease liabilites 10 1 760 Trade and other payables 11 18 531 21 400 Current interest-bearing liabilities 20 34 364 Other current liabilities 20 75 804 32 200 Total current liabilities 130 458 53 600 Total liabilities and equity 4 618 945 4 571 479 Ørjan Svanevik Chairman of the Board Lars Peder Fensli Board Member Ingunn Ettestøl Board Member Henning Hansen Board Member Christine Grabmair Board Member Kjetil Kvamme Board Member Knut Ove Stenhagen Board Member Annette Maier Board Member Anja Schneider Board Member Vija Pakalkaite Board Member Trond Straume Chief Executive Officer Oslo, Norway, 29 March 2022 The Board of Directors and CEO Volue ASA Annual Report 2021 Parent company ﬁnancial statements 59 Statement of changes in equity For the year ended 31 December Amounts in NOK 1000 Share capital Share premium Own shares Retained earnings Total equity Balance at 1 January 2021 57 431 4 434 900 - -12 025 4 480 306 Profit/(loss) for the period - - - -3 115 -3 115 Share capital increase 117 14 057 - - 14 174 Own shares - -8 390 -92 - -8 482 Balance at 31 December 2021 57 548 4 440 567 -92 -15 141 4 482 883 Statement of cash ﬂows For the year ended 31 December Amounts in NOK 1000 2021 2020 Cash flow from operating activities Profit/(loss) before income tax 928 -14 162 Depreciation, amortisation and impairment 3 309 469 Net financial items -33 827 2 236 Tax on transacation costs related to share issue -4 947 Total after adjustments to profit before income tax -29 591 -16 403 Change in trade and other receivables -60 639 -100 Change in trade and other payables 15 841 -9 966 Total after adjustments to net assets -74 389 -26 470 Change in tax paid - - Net cash flow from operating activities -74 389 -26 470 Cash flow from investing activities Interest received 818 215 Group contribution received 32 880 Purchase of PPE and intangible assets -3 485 -3 224 Loans to employees 3 406 -30 682 Loans to subsidiaries -39 921 -5 000 Proceeds on loans from subsidiaries 5 000 Purchase of shares in subsidiaries -36 695 -304 778 Net cash flow from investing activities -37 996 -343 469 Cash flow from financing activities Proceeds from issue of shares - 550 065 Repayment of lease liabilities -1 709 - Cash Flow from Internal Loans and Borrowings 30 000 - Interest paid etc. -475 -2 451 Cash flow from own shares -5 209 Net cash flow from financing activities 22 607 547 614 Net increase in cash and cash equivalents -89 778 177 675 Cash and cash equivalents at the beginning of the financial year 177 675 - Effects of exchange rate changes on cash and cash equivalents -781 - Cash and cash equivalents at end of year 87 115 177 675 Annual Report 2021 Parent company ﬁnancial statements 60 Note 1 Accounting principles Basis for preparation The annual financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) adopted by the European Union and associated interpretations, as well as Norwegian disclosure requirements pursuant to the Norwegian Accounting Act applicable as of 31 December 2021. The financial statements are presented in Norwegian kroner (NOK), which is the functional currency of the parent company. All amounts disclosed in the financial statements and notes have been rounded off to the nearest thousand NOK units unless otherwise stated. The financial statements have been prepared using the historical cost principle. The company recognises changes in equity arising from transactions with owners in the statement of changes in equity. Other changes in equity are presented in the statement of comprehensive income (total return). Shares in subsidiaries Shares in subsidiaries are initially recognised at cost, which is the fair value of any consideration transferred. Shares in subsidiaries are subsequently measured at cost. Foreign currency Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates, are generally recognised in profit or loss. Revenue recognition Under IFRS 15, Volue ASA recognises as revenue the agreed transaction price in a contract with a customer at the time when the company transfers the control of a distinct product or service to the customer at an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods and services. In 2021 Volue ASA had no revenues from external customers. All revenues are related to billing of overhead costs in the company to subsidiaries, which is classified as other income. Income tax Income tax on the profit for the period consists of current and deferred tax. Income tax is recognised in the income statement except for tax on items that are recognised directly in equity or in other comprehensive income. The tax effect of the latter items is recognised directly in equity or in other comprehensive income. Current tax is the forecast tax payable on the year’s taxable income at current tax rates at the balance sheet date, and any adjustments of tax payable for previous years less tax paid in advance. Deferred tax liabilities are calculated based on the balance sheet-oriented liability method considering temporary differences between the carrying amount of assets and liabilities for financial reporting and tax values. Deferred tax assets are recognised only to the extent that it is probable that the asset can be utilised against future taxable results. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax asset will be realised. Leases The company’s and the company’s leases consist mainly of office space. Assets and liabilities arising from a lease are initially measured on a present value basis. Right-of-use assets are measured at cost comprising the following: • the amount of the initial measurement of lease liability, • any lease payments made at or before the commencement date less any lease incentives received, • any initial direct costs, and • restoration costs. Notes to the parent company ﬁnancial statements For the year ended 31 December Annual Report 2021 Parent company ﬁnancial statements 61 Lease liabilities include the net present value of the following lease payments: • fixed payments (including in-substance fixed payments), less any lease incentives receivable, • variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the commencement date, • amounts expected to be payable by the company under residual value guarantees • the exercise price of a purchase option if the company is reasonably certain to exercise that option, and • payments of penalties for terminating the lease, if the lease term reflects the company exercising that option. Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability. The lease payments are discounted using the lessee’s incremental borrowing rate, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions. Cash and cash equivalents For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet. Receivables and loans Trade receivables are recognised initially at the amount of consideration that is unconditional, unless they contain significant financing components when they are recognised at fair value. They are subsequently measured at amortised cost using the effective interest method, less loss allowance for lifetime credit losses. Other loans and receivables are initially recognised at fair value. They are subsequently measured at amortised cost using the effective interest method, less loss allowance for credit losses. Credit losses are initially measured at 12 months expected credit loss. If there is significant increase in credit risk, the loss allowance is based on lifetime expected credit loss. The company does not make loss provisions for expected credit losses that are immaterial. Property, plant and equipment The depreciation methods and periods used by the company are disclosed in note 8 . The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss. When revalued assets are sold, it is group policy to transfer any amounts included in other reserves in respect of those assets to retained earnings. Trade and other payables These amounts represent liabilities for goods and services provided to the company prior to the end of the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method. Annual Report 2021 Parent company ﬁnancial statements 62 Note 2 Revenue from contracts with customers All revenues in Volue ASA is revenue from group companies, related to billing of overhead costs to subsidiaries. Amounts in NOK 1000 2021 2020 Revenue from group companies (billing of overhead costs to subsidiaries) 84 555 25 093 Public funding (SkatteFunn) 161 - Total employee benefit expenses 84 716 25 093 Note 3 Remuneration and employee beneﬁt Amounts in NOK 1000 2021 2020 Salaries 21 730 11 066 Social security contributions 1 875 1 560 Pension costs 192 - Other benefits 2 122 - Total employee benefit expenses 25 919 12 626 Average number of employees 3 2 Number of fixed employees in Volue ASA is as disclosed above. In addition members of the executive management team are employed in subsidiaries. Salary cost for these employees are charged from subsidiaries to Volue ASA. Note 4 Other operating expenses Amounts in NOK 1000 2021 2020 Premises, service and office costs 1 994 1 224 Audit and other fees 40 515 1 209 Travelling costs, indirect 412 150 Sales and marketing costs 850 195 ICT costs 10 112 152 Operating costs, IC 10 073 2 389 Other direct costs 7 127 18 604 Total employee benefit expenses 71 083 23 923 Remuneration to auditor Statutory audit 1 218 350 Other assurance services 28 209 Tax advice 108 - Other non-audit services 1 981 650 Total remuneration to auditor 3 335 1 209 Remuneration to auditor also include services related to equity transactions Annual Report 2021 Parent company ﬁnancial statements 63 Note 5 Income tax Amounts in NOK 1000 2021 2020 Basis for payable tax Profit (loss) before income tax 928 -14 162 Permanent differences 17 450 -18 036 Basis for payable tax 18 378 -32 198 Effect of change in temporary differences 135 -682 Changes i deferred tax assets -18 513 32 880 Basis for payable tax 0 0 Payable tax (22%) 0 0 Reconciliation of effective tax rate Total pre tax income 928 -14 162 Tax based on current ordinary tax rate 204 -3 116 Effect of non deductible expenses 3 839 -3 968 Tax on transaction costs related to share issue 0 4 947 Total tax expense 4 043 -2 137 Effective tax rate 435% 15% The effective tax rate is impacted by the permanent differences. Amounts in NOK 1000 2021 2020 Temporary differences Fixed assets -679 -682 RoU assets 132 Tax losses carried forward 14 367 32 880 Basis for deferred tax asset / (liability) 13 820 32 198 Deferred tax asset / (liability) 3 040 7 084 Note 6 Trade and other receivables Trade receivables Amounts in NOK 1000 2021 2020 Trade receivables from contracts with customers 90 392 31 367 Loss allowence 0 0 Total 90 392 31 367 Other receivables Amounts in NOK 1000 2021 2020 Other receivables from subsidiaries 36 460 100 Other short-term receivables 6 196 - Total 42 656 100 Total trade and other receivables 133 048 31 466 Note 7 Cash and cash equivalents Amounts in NOK 1000 2021 2020 Total cash and cash equivalents 87 115 177 675 Restricted cash 763 0 Restricted cash are related to tax funds. Annual Report 2021 Parent company ﬁnancial statements 64 Note 8 Property, plant and equipment Amounts in NOK 1000 Vehicles, machinery and equipment RoU buildings and land Total Year ended 31 December 2020 Cost at 1 January 2020 Additions 3 224 3 224 Change in RoU 9 072 9 072 Cost at 31 January 2020 3 224 9 072 12 297 Accumulated depreciation at 1 January 2020 Depreciation 469 469 Change in RoU Accumulated depreciation at 31 December 2020 469 469 Carrying amount at 31 December 2020 2 755 9 072 11 827 Amounts in NOK 1000 Vehicles, machinery and equipment RoU buildings and land Total Year ended 31 December 2021 Cost at 1 January 2021 3 224 9 072 12 297 Additions 3 485 3 485 Change in RoU - Cost at 31 January 2021 6 709 9 072 15 781 Accumulated depreciation at 1 January 2021 469 - 469 Depreciation 1 468 1 841 3 309 Change in RoU - Accumulated depreciation at 31 December 2021 1 937 1 841 3 778 Carrying amount at 31 December 2021 4 772 7 231 12 003 Property, plant and equipment is recognised at historical cost less depreciation. Depreciation is calculated using the straight-line method to allocate the cost or revalued amounts of the assets, net of their residual values, over their estimated useful lives as follows: • Buildings 25-40 years • Machinery 3-5 years • Vehicles 3-5 years See note 1 for the other accounting policies relevant to property, plant and equipment. More information regarding right of use assets are presented in note 10 Leases. Annual Report 2021 Parent company ﬁnancial statements 65 Note 9 Non-current receivables and investments Amounts in NOK 1000 2021 2020 Loans to employees 27 276 30 682 Total non-current receivables and investments 27 276 30 682 The loans to key management personnel are related to purchase of shares in Volue ASA and the shares are used as collateral according to the loan agreements. Interest rate for the loans is not below the threshold for making the loan a taxable benefit. At year end the interest rate was 1.3%. Note 10 Leases This note provides information for leases where the group is a lessee. Amounts recognised in the balance sheet The balance sheet shows the following amounts relating to leases: Amounts in NOK 1000 2021 2020 RoU buildings and land 7 231 9 072 Total right-of-use assets 7 231 9 072 Current lease liabilities 1 760 - Non-current lease liabilities 5 603 9 072 Total lease liabilities 7 363 9 072 Amounts recognised in the statement of income The statement of income shows the following amounts relating to leases: Amounts in NOK 1000 2021 2020 Depreciation RoU buildings and land 1 841 - Total depreciation charge right-of-use assets 1 841 - Interest expense 245 - Annual Report 2021 Parent company ﬁnancial statements 66 Note 11 Trade and other payables Amounts in NOK 1000 2021 2020 Trade payables intercompany 16 276 12 292 Trade payables other 2 255 9 108 Total 18 531 21 400 Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their short-term nature. Note 12 Finance items Amounts in NOK 1000 2021 2020 Interest income 1 137 215 Currency exchange gains 2 684 Group contribution income 32 880 Total Finance income 36 700 215 Interest expense 230 2 451 IFRS 16 interest 245 - Currency exchange losses 2 398 - Total finance cost 2 873 2 451 Net finance items 33 827 -2 236 Annual Report 2021 Parent company ﬁnancial statements 67 Note 13 Share information Amounts in NOK 1000 2021 2020 Ordinary shares 143 869 714 143 577 626 Share capital 57 548 57 431 Share premium 4 440 567 4 434 900 At 31 December 2021 there were 143 869 714 ordinary shares each with a par value of NOK 0,40. They entitle the holder to participate in dividends, and to share in the proceeds of winding up the company in proportion to the number of and amounts paid on the shares held. Changes in share capital Amounts in NOK 1000 Date Share capital Share premium Share capital 1 January 2021 01.01.2021 57 431 4 434 900 Share capital increase 22.12.2021 83 10 184 Share capital increase 28.12.2021 34 3 872 Transactions in own shares -8 390 Share capital at year end 2021 57 548 4 440 567 Major share holders Amounts in NOK 1000 Number of shares % of major shareholders % of total Country Arendals Fossekompani ASA 86 316 779 73.33% 60.03% Norway Fidelity Investments (FMR) 13 942 086 11.85% 9.70% USA Swedbank Robur Funds 8 379 750 7.12% 5.83% Sweden Invesco 3 021 672 2.57% 2.10% USA TIN Funds 1 600 000 1.36% 1.11% Sweden AS Tanja (Andenæsgruppen) 1 518 049 1.29% 1.06% Norway Ulfoss Invest AS 1 470 987 1.25% 1.02% Norway Havfonn AS 1 456 790 1.24% 1.01% Norway Other shareholders (holding less than 1%) 26 163 601 18.14% Total all shareholders 143 869 714 100.00% 100.00% Note 14 Subsidiaries The Volue Group is a part of the Arendal Fossekompani (AFK) Group and are included in the consolidated financial statements. Volue Group are required to follow the AFK reporting processes during both monthly closing and year end closing. Subsidaries Company Ownership held by the group Domicile Head- quarters Book value Volue Technology AS 100.00% Norway Trondheim 2 991 966 Volue Market Service AS 100.00% Norway Arendal 122 087 Volue IoT AS 94.76% Norway Arendal 170 012 Volue Insight AS 100.00% Norway Arendal 873 197 Volue Germany GmbH (former Likron GmbH) 100.00% Germany München 156 012 Volue Energy GmbH (former Procom GmbH) 100.00% Germany Aachen 35 214 Total book value 4 348 487 In 2021 Volue purchased the remaining minority shares of its subsidiaris Market Services AS and Volue Technology AS, and now controls 100% of the shares. On 1 October 2021 Volue ASA acquired 100% of the issued share capital of Procom GmbH. Volue ASA granted a seller credit related to the share issue. Remaning holdback is related to escrow accounts and adjustment related to performance of Procom GmbH towards 30 June 2022. The performance related payment is related to revenues of Procom GmbH from 1 July 2021 until 30 June 2022, and postive or negative deviation from baseline will give adjustment on the purchase price. There are no other earn-out mecanisms or other deffered payment after 30 June 2022. Annual Report 2021 Parent company ﬁnancial statements 68 Note 15 Related parties At year end Arendal Fossekompani (AFK) owned 86.316.779 shares, representing 60% of the total number of shares in Volue. Board of Directors compensation 2021 and number of shares owned 31 December 2021 Amounts in NOK 1000 Name Title Board of Directors remunerated Number of shares Ørjan Svanevik Chairman - 7 500 Henning Hansen Member of Board 300 42 857 Lars Peder Fosse Fensli Member of Board - 17 000 Christine Grabmaier Member of Board 324 - Ingunn Ettestøl Member of Board - 6 187 Annette Petra Maier Member of Board 84 - Anja Eva Schneider Member of Board 84 - Knut Ove Blichner Stenhagen Employee - Elected Board member 80 6 946 Vija Pakalkaite Employee - Elected Board member - 102 Kjetil Kvamme Employee - Elected Board member 80 - Name Title Fixed salary Paid bonus Pension Other benefit's Number of shares in Volue Loan from Volue Trond Straume CEO 4 070 3 518 80 245 546 715 9 128 Arnstein Kjesbu CFO 2 544 1 730 80 11 337 204 5 477 Ingeborg Gjærum CSO 1 550 207 80 4 85 714 1 460 Kevin Gjerstad CTO 1 500 863 80 7 - - Tom Darell EVP Energy 1 900 1 211 80 4 - - Lars Ove Johansen EVP Power Grid 1 806 854 80 5 128 571 2 191 Vigleik Takle CCO 1 850 - 80 4 128 571 2 191 Frode Solem EVP Infrastructure 1 575 1 172 223 11 128 571 2 191 Kim Steinsland EVP IIoT 1 606 471 80 3 171 429 2 921 Thale Kuvås Solberg CDO 1 320 65 80 8 21 875 - The CEO’s period of notice is six months, with a period of pay of 12 months after termination of employment if the CEO is dismissed by the company. The other members of the Group Executive have a period of notice of six months. Guidelines for pay and other remuneration of the executive management The purpose of Volue’s compensation and benefits policy is to attract personnel with the competence that the Group requires, develop and retain employees with key expertise and promote a long-term perspective and continuous improvement supporting achievement of Volue’s business goals. The general approach adopted in Volue’s policy is to pay fixed salaries and pensions in line market prices, while offering variable pay linked to results for bonus and long term incentive plan for share incentive program. (LTIP) a. Fixed elements b. Variable elements – annual bonus Executives in Volue participate in the Group’s central annual bonus program. The program has a maximum ceiling of 50% of the executive’s fixed salary. The basis for bonus payments is based on financial targets and performance strategic KPI’s. A “good performance” has been defined as the achievement of results in line with externally communicated financial targets. Note 15 continues on next page Annual Report 2021 Parent company ﬁnancial statements 69 Note 16 Contingent liabilites The company had no contingent liabilities at 31 December 2021. Note 17 Subsequent events The adverse market conditions brought by the war in Ukraine is considered to have very limited impact on the business. One subsidiary of Volue ASA has terminated the contracts we have with one Russian customer within the given notice periods. Note 18 Other gains/losses Related to purchase of Likron GmbH there was used a seller credit related to the share issue. Earn-out 2020 and 2021 are based on Likron reaching threshold revenue targets indicating ARR growth. Payment based on 60% cash and 40% shares based on full earn-out. Based on the performance above expecations in 2021 the total earn-out payment has increased with 17 304 TNOK. The increase in earn- out has been recoginaised in the profit and loss as other losses. In addition to the consideration disclosed above, the seller is entitled to a deferred consideration that will be paid if the current management will stay in their position until the end of 2022. Deferred consideration will be recognised as employee expenses. The maximum deferred consideration is NOK 21.2 million (EUR 2.0 million) In addition, the Group has share-based incentive programs described in (c) below and a share option programs for key employees described in (d) below. For 2021 paid bonus contains for certain members of the ELT exit from LTIP agreement following incentiv system prior to the establishment of Volue. c. Shared incentive program On 13 October 2020, the Board of Directors of the Company resolved to establish a share incentive program for key employees of the Company. The share incentive program is based on a structure in which certain members of the Company’s Management and management of the Portfolio Companies are offered the opportunity to subscribe for Shares at a discounted rate, and where the Company will provide partial financing of their subscription of Shares under the share incentive program. The total number of Shares included in the share incentive program is 1,821,429. As part of the share incentive program, the key employees purchased Shares at a discount of 30% of the trading price of the Shares, subject to a lock-up undertaking of 36 months following the date of the purchase of the Shares. The company has provided loan financing for up to 75% of the purchase price of the Shares under the share incentive program, for a total of up to NOK 36 million. d. The share option plan is based on a structure in which the Company’s senior management and certain other key employees are granted share options in the Company. Each share option carries the right to acquire one share in the Company. The total number of share options that may be issued under the plan is 2,397,747 for the first year grant of options. 15% of the options shall be reserved for the Company’s Chief Executive Officer. The Chief Executive Officer is authorised to allocate the options reserved for the executive management team and other key employees and to determine who qualifies as a key employee in a strategic position. The share options will be granted over a three-year period, and the plan will be assessed annually for further grants. The share options vest three years after the date of grant and will lapse if not exercised within seven years following the date of grant. For the share options to vest, a minimum average share price development of 4.5% p.a is required. Upon any exercise of share options the Company may settle its obligations by selling the relevant number of shares or by payment in cash. For further information, see separate remuneration report publised at the companys website. Note 15 Related parties cont. Annual Report 2021 Parent company ﬁnancial statements 70 Note 19 Intercompany loans Amounts in NOK 1000 2021 2020 Loan to Volue Germany GmbH (former Likron GmbH) 7 975 - Loan to Volue Market Services AS - 5 000 Total intercompany loans 7 975 5 000 Note 20 Current liabilities Current interest-bearing liabilities Amounts in NOK 1000 2021 2020 Due to Volue Market Services AS 30 000 - Due to Volue Energy GmbH (former ProCom GmbH) 4 364 - Total current interest-bearing liabilities 34 364 - Other current liabilities Amounts in NOK 1000 2021 2020 Sellers credit related to Volue Germany GmbH (former Likron GmbH) 57 253 32 200 Sellers credit related to Volue Energy GmbH (former ProCom GmbH) 9 278 Other taxes, VAT and dues payable 1 052 Other current liabilities 8 221 Total other current liabilities 75 804 32 200 71 PricewaterhouseCoopers AS, Kystveien 14, NO-4841 Arendal T: 02316, org. no.: 987 009 713 MVA, www.pwc.no Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap To the General Meeting of Volue ASA Independent Auditor s Report Report on the Audit of the Financial Statements Opinion We have audited the financial statements of Volue ASA, which comprise: • The financial statements of the parent company Volue ASA (the Company), which comprise the balance sheet as at 31 December 2021, the statement of income, statement of other comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and • The consolidated financial statements of Volue ASA and its subsidiaries (the Group), which comprise the consolidated balance sheet as at 31 December 2021, the consolidated statement of income, consolidated statement of other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion: • the financial statements comply with applicable statutory requirements, • the financial statements give a true and fair view of the financial position of the Company as at 31 December 2021, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the EU, and • the financial statements give a true and fair view of the financial position of the Group as at 31 December 2021, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted by the EU. Our opinion is consistent with our additional report to the Audit Committee. Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company and the Group as required by laws and regulations and the International Ethics Standards Board for Accountants International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in Independent Auditor's Report - Volue ASA (2) accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit Regulation (537/2014) Article 5.1 have been provided. We have been the auditor of the Company for 2 years from the election by the general meeting of the shareholders on 26.11.2019 for the accounting year 2020. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Key Audit Matter How our audit addressed the Key Audit Matter Revenue from construction contracts In 2021, revenue from construction contracts constituted NOK 854 722 thousand, equal to approximately 82% of total operating revenues. Revenue from construction contracts is recognized over time based on expected final outcome, and stage of completion of the contract. Assessment of total contract cost, revenue and stage of completion is updated on a regular basis. There are several reasons why we consider revenue from construction contracts a key audit matter. The Group has a significant volume of construction contracts, such contracts may have a long duration during which time the assessment of contract costs and stage of completion may be complex and subject to judgement. Furthermore, management s judgement related to construction contracts impact several areas of the financial statements including revenue, operating expenses, contract assets and liabilities, trade receivables and payables, provisions, and corporate income tax. Notes 3 and 4 and the accounting principles include additional information on the Group s construction contracts. We obtained a sample of contracts and assessed accounting treatment against the Group s accounting principles and IFRS 15 Revenue from contracts with customers . We found that the accounting treatment is consistent with the content of the contracts and that accounting principles was based on IFRS 15. The Group had implemented controls to ensure that accounting for construction contracts reflect management s best estimates with respect to total contract cost, revenue, and stage of completion. Controls was implemented at various levels of the organisation and included periodic meetings to review open contracts. Through meetings with management and project leaders, including review of relevant documentation, we tested whether relevant controls were implemented. Estimating project costs and calculating stage of completion requires judgement. We performed various procedures to assess whether management s judgements were reasonable, including: • Interviewed project leaders and management challenging judgements made with respect to project estimates. • Reconciled expenses and hours incurred against budgeted expenses and hours. • Comparing actual outcome on completed project against initial budget. Annual Report 2021 Independent auditor’s report Independent auditor’s report 72 Independent Auditor's Report - Volue ASA (3) • Assessed whether stage of completion on open projects corresponds to amounts recognised in the financial statements. We found that assumptions used, and judgements made by management were reasonable. We further evaluated the disclosures in note 3 and 4 and found these to be free from material misstatement. Valuation of goodwill and intangible assets As at 31 December 2021 carrying amount of goodwill and intangible assets in the Group s financial statements was NOK 542 528 thousand, equal to approximately 31% of total assets. Goodwill and intangible assets with indefinite economic life are tested for impairment at least annually. Other intangible assets are tested for impairment when indicators of impairment exist. Impairment testing is performed at the level of cash generating unit. When testing for impairment, the carrying amount is compared to recoverable amount. The recoverable amount is determined based on value in use or fair value less cost of disposal. As at 31 December 2021, management s impairment assessment indicated that recoverable amount exceeded carrying amount for all cash generating units where goodwill and intangible assets were recognised. As a result, no impairment was recorded. We focused on this area because goodwill and intangible assets constitute a significant share of the Group s total assets and calculation of recoverable amount involves significant judgement by management. Refer to note 12 to the financial statements for further information on goodwill and intangible assets, cash generating units and impairment testing. We obtained and gained an understanding of management s impairment assessment related to goodwill and intangible assets. Our procedures included an assessment of the valuation method and whether key assumptions used by management appeared reasonable based on our understanding of the business and industry of each relevant cash generating unit. We also traced data used in valuation models to underlying documentation. Based on our audit procedures we found that valuation methods used were reasonable and consistent with our understanding of the business and industry. Our testing of data against underlying documentation did not uncover material exceptions. While we did not find evidence to indicate that goodwill or intangible assets were impaired, we note that the valuation of cash generating units is sensitive to changes in assumptions. Lastly, we evaluated the information provided in note 6 to the financial statements where management describes the Group s goodwill and intangible assets and the results of the impairment testing. We found that the disclosures described management s valuation of goodwill and intangible assets appropriately. Independent Auditor's Report - Volue ASA (4) Other Information The Board of Directors and the Managing Director (management) are responsible for the information in the Board of Directors report and the other information accompanying the financial statements. The other information comprises information in the annual report, but does not include the financial statements and our auditor s report thereon. Our opinion on the financial statements does not cover the information in the Board of Directors report nor the other information accompanying the financial statements. In connection with our audit of the financial statements, our responsibility is to read the Board of Directors report and the other information accompanying the financial statements. The purpose is to consider if there is material inconsistency between the Board of Directors report and the other information accompanying the financial statements and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors report and the other information accompanying the financial statements otherwise appears to be materially misstated. We are required to report if there is a material misstatement in the Board of Directors report or the other information accompanying the financial statements. We have nothing to report in this regard. Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors report • is consistent with the financial statements and • contains the information required by applicable legal requirements. Our opinion on the Board of Director s report applies correspondingly to the statements on Corporate Governance and Corporate Social Responsibility. Responsibilities of Management for the Financial Statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the EU, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Company s and the Group s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Independent auditor’s report cont. Annual Report 2021 Independent auditor’s report 73 Independent Auditor's Report - Volue ASA (5) As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: • identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error. We design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's or the Group's internal control. • evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. • conclude on the appropriateness of management s use of the going concern basis of accounting, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company and the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor s report. However, future events or conditions may cause the Company and the Group to cease to continue as a going concern. • evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves a true and fair view. • obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the Audit Committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Independent Auditor's Report - Volue ASA (6) Report on Other Legal and Regulatory Requirements Report on compliance with Regulation on European Single Electronic Format (ESEF) Opinion We have performed an assurance engagement to obtain reasonable assurance that the financial statements with file name Volue Annual Report 2021.zip have been prepared in accordance with Section 5-5 of the Norwegian Securities Trading Act (Verdipapirhandelloven) and the accompanying Regulation on European Single Electronic Format (ESEF). In our opinion, the financial statements have been prepared, in all material respects, in accordance with the requirements of ESEF. Management s Responsibilities Management is responsible for preparing and publishing the financial statements in the single electronic reporting format required in ESEF. This responsibility comprises an adequate process and the internal control procedures which management determines is necessary for the preparation and publication of the financial statements. Auditor s Responsibilities Our responsibility is to express an opinion on whether the financial statements have been prepared in accordance with ESEF. We conducted our work in accordance with the International Standard for Assurance Engagements (ISAE) 3000 Assurance engagements other than audits or reviews of historical financial information . The standard requires us to plan and perform procedures to obtain reasonable assurance that the financial statements have been prepared in accordance with the European Single Electronic Format. As part of our work, we performed procedures to obtain an understanding of the company s processes for preparing its financial statements in the European Single Electronic Format. Our work comprised reconciliation of the financial statements under the European Single Electronic Format with the audited financial statements in human-readable format. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Arendal, 29 March 2022 PricewaterhouseCoopers AS Lars Ole Lindal State Authorised Public Accountant Independent auditor’s report cont. Annual Report 2021 Independent auditor’s report 74 Annual Report 2021 Members of the Board Members of the Board The overall management of the Company is vested in the Board of Directors and the Management. In accordance with Norwegian law, the Board of Directors is responsible for, among other things, supervising the general and day-to-day management of the Company’s business, ensuring proper organisation, preparing plans and budgets for its activities, ensuring that the Company’s activities, accounts and asset management are subject to adequate controls and undertaking investigations necessary to perform its duties. As of 29 March 2022, Volue’s board comprised ten members, of which two are employee-elected. Volue’s board is composed such that it is able to act independently of any special interests. 75 Ørjan Svanevik (1966) Chairman of the Board Ørjan Svanevik has been the Chief Executive Officer of Arendals Fossekompani ASA since September 2019. He has extensive experience from various directorships and executive management positions within a wide range of industries. Svanevik held several executive management positions prior to joining Arendals Fossekompani ASA, including Chief Operating Officer in Kværner ASA, Head of M&A in Aker ASA and Chief Operating Officer in the Seatankers group. Svanevik holds Master og General Business from BI and MBA from Thunderbird. Chairman of the Board in Volue since: 2019 Elected until: 2023 Independent of Executive Management Current Board positions: Chairman of the board of directors of Oavik Capital AS and Oavik Invest AS, Prai AS, EFD Induction AS and C.W. Downer AS, and member of the board of directors of NorgesGruppen ASA and NorgesGruppen Finans Holding AS. Number of shares in Volue ASA: 7,500 Board meetings attended in 2021: 20/20 Ingunn Ettestøl (1973) Board Member Ingunn Ettestøl has held the position as Chief Sustainability Officer (CSO) in Arendals Fossekompani ASA since September 2020. Prior to that, she was Vice President of Business Development in Arendals Fossekompani ASA from 2017. Ettestøl has extensive experience from the energy sector and has held several management positions in Agder Energi AS and Enova SF. She holds a PhD in Electrical Power Engineering from NTNU and a Master degree in Theoretical Physics from NTNU. Board member since: 2020 Elected until: 2022 Independent of Executive Management Current Board positions: Etcona AS (Chair) and Arendals Fossekompani’s Pensjonskasse (member) Number of shares in Volue ASA: 6,187 Board meetings attended in 2021: 20 Annual Report 2021 Members of the Board Lars Peder Fosse Fensli (1976) Board Member Lars Peder Fosse Fensli has been the Chief Financial Officer of Arendals Fossekompani ASA since April 2017. Prior to this, he held the position as Chief Executive Officer of Markedskraft AS. Fensli has more than 20 years of experience from several board- and management positions, including International Marketing Manager in Axellus AS, Marketing Manager in Lilleborg AS, Manager business consulting in PWC and Finance Manager in Arendals Fossekompani ASA. He holds a MSc in Economics and Business Administration from Norwegian School of Economics (NHH). Board member since: 2020 Elected until: 2023 Independent of Executive Management Current Board positions: NorSun AS (member) Member of: Audit Committee Number of shares in Volue ASA: 17,000 Board meetings attended in 2021: 20 Christine Grabmair (1979) Board Member Christine Grabmair has been the Head of Customer Solutions of E.ON Digital Technology GmbH, Germany since April 2019. She has 18 years of experience from the industrial and technology industries, including as Chief Information Officer at Components Technology at thyssenkrupp AG. Grabmair holds a diploma in Business Administration and a MSc in Information Systems. Board member since: 2021 Elected until: 2022 Independent of Executive Management and the company’s main shareholder Number of shares in Volue ASA: 0 Board meetings attended in 2021: 15 76 Henning Hansen (1965) Board Member Henning Hansen has more than 30 years’ experience from the software and technology industry and has worked as a full time non- executive Board member and owner of HEPE Consulting AS since 2017. He previously held the positions as Chief Executive Officer in Norman ASA and Confirmit ASA, Vice President of Gartner Norway and Oracle Norway, and IT manager of Eltek ASA. Hansen has also served as chairman of Apsis AB, and as a member of the board of directors of Catalystone AS, ENEAS AS, Software Innovation AS and Powel AS. Hansen holds two bachelor degrees: A BBa from BI Norwegian School of Management in Oslo and a BSc from Oslo Ingeniørhøyskole. Board member since: 2020 Elected until: 2022 Independent of Executive Management and the company’s main shareholder Current Board positions: Chairman of the board of Norstat AS and Defendable AS and member of the board of directors of GSGroup AS, Wellit AS and Forsta AS. Member of: Audit Committee Number of shares in Volue ASA: 42,857 Board meetings attended in 2021: 20 Dr. Vija Pakalkaite (1982) Board Member, elected by the employees Vija Pakalkaite is the Managing Director of Volue Insight of the German business in Berlin, and she also leads a mid-term and long-term electricity market analysis team. Prior to joining Volue, she worked at market intelligence company ICIS, Central Bank of Lithuania, European Commission, as well as for Bonnier Business Press. Pakalkaite holds a PhD in political science, awarded by the Central European University of Vienna/Budapest. Board member since: 2021 Elected until: 2023 Number of shares in Volue ASA: 102 Board meetings attended in 2021: 0 1 Knut Ove Blichner Stenhagen (1985) Board Member, elected by the employees Knut Ove Blichner Stenhagen holds the position as Head of Automation in Industrial IoT at Volue. He has served as member of the board of directors of Scanmatic AS, now Industrial IoT by Volue, from 2014 and has held the position as Head of Automation since January 2018. Prior to this Stenhagen worked as a Development engineer in Scanmatic (2012-2017) and a Project Engineer at Siemens (2009-2012). He holds a Master of Science in Engineering Cybernetics from Norwegian University of Science and Technology (2009). Board member since: 2020 Elected until: 2023 Number of shares in Volue ASA: 6,946 Board meetings attended in 2021: 20 Kjetil Kvamme (1966) Board Member, elected by the employees Kjetil Kvamme holds the position as Product Manager in Power Grid at Volue and has been with the company since 1995. Prior to this he worked at an Electrical Utility in Tromsø as an installer and later electrical engineer for six years. Kvamme has previously served as Board Member in Powel AS from 2015 until 2021. He holds a Master of Sciences in Applied Physic from University of Tromsø. Board member since: 2020 Elected until: 2023 Number of shares in Volue ASA: 0 Board meetings attended in 2021: 10 Annual Report 2021 Members of the Board [1] On maternity leave since elected to the Board of directors. Deputy Board member, Jens Dalsgaard has attended seven Board meetings in 2021. 77 Anja Schneider (1976) Board Member Anja Schneider serves as Senior Vice President and Chief Operating Officer (COO) globally for the executive board area Technology & Innovation at SAP, the world largest provider and market leader in enterprise application software. In this role she is responsible for the operationalisation of development strategy incl. planning, business transformation, workforce strategy, portfolio management, cloud operations as well as strategic customer engagements. She brings more than 20 years of experience in technology and business. Schneider held various senior leadership positions in the area of Sales, Go-to-Market Strategy, strategic planning of IT landscapes, integration, business model innovation as well as extensive industry knowledge. Schneider holds a Master in public management and business from the University of Applied Sciences - Public Administration and Finance Ludwigsburg. Board member since: 2021 Elected until: 2023 Independent of Executive Management and the company’s main shareholder Number of shares in Volue ASA: 0 Board meetings attended in 2021: 3 Annette Maier (1968) Board Member Annette Maier is Area Vice President Central & Eastern Europe at UiPath, a leading provider of automation and RPA (Robotic Process Automation) and is responsible for the business in the regions of Central and Eastern Europe. Maier brings more than 20 years of experience in management and sales in European companies in the tech sector. Prior to her position at UiPath, she was responsible for the growth of the cloud business within the DACH region at Google Cloud. She also spent six years at VMware, where she most recently was Vice President and General Manager in Germany, and earlier Director Global Accounts at CEMEA and led the Enterprise Account Team. Before that, Maier spent more than six years in management positions at Hewlett-Packard. She holds MBA in business administration and economics at the University of Cologne in Germany. Board member since: 2021 Elected until: 2023 Independent of Executive Management and the company’s main shareholder Current Board positions: Compass Group (member) Number of shares in Volue ASA: 0 Board meetings attended in 2021: 3 Annual Report 2021 Members of the Board 78 Annual Report 2021 Alternative Performance Measures Alternative Performance Measures Basis for preparation This presentation provides financial highlights for the quarter for Volue. The financial information is not reported according to the requirements in IAS 34 and the figures are not audited. Volue ASA presents alternative performance measures as a supplement to measures regulated by IFRS. The alternative performance measures are presented to provide better insight and understanding of operations, financial position and the basis for future developments. The definitions of these measures are as follows: • Adjusted EBITDA: In order to give a better representation of underlying performance, EBITDA is adjusted with non-recurring items. Note that adjusted EBITDA does not include estimated one-off loss of revenues due to the cyber-incident. • ARR: Annual Recurring Revenues is defined as revenues from recurring contracts including software as a service. • EBIT: Profit/loss before tax and net finance cost. • EBITDA: Profit/loss before tax, net finance cost, depreciation, amortisation and impairment. • SaaS: Software as a service. SaaS revenues are defined as revenues from software hosted by Volue and distributed through web applications • Non-recurring items: Items that are not part of the ordinary business, such as IPO related costs and insurance settlement related to the cyber-incident. In addition, external costs related to implementation of corporate back-office cloud-based systems (e.g. ERP) are considered non- recurring. In accordance with IFRS IC agenda decision (Configuration or Customisation Costs in a Cloud Computing Arrangement) from April 2021, these costs have not been capitalised, as they previously would have been. Through digital platforms and innovative solutions, we deliver services critical to society for a cleaner, beer, and more proﬁtable future. Volue ASA Chr. Krohgsgate 16 Postboks 9008 NO-0186 Oslo Norway [email protected] +47 73 80 45 00

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