Earnings Release • Aug 19, 2021
Earnings Release
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Kahoot! Group
OSLO, 19 August 2021 – Kahoot! ASA, (KAHOT) today announced financial results for its fiscal quarter ended 30 June 2021, in-line with the main numbers presented on the trading update 7 July 2021. The Kahoot! Group continued its strong performance in the second quarter of 2021, including solid growth in usage, revenues, subscribers, launch of several new features and services as well as the completed acquisition of the learning app provider Motimate, and the announced acquisition of Clever, one of the most widely-used digital learning platforms by U.S. K-12 schools.
Invoiced revenue for the Kahoot! Group reached \$20.6 million in the second quarter 2021, an increase of 114%, or \$11 million year-over-year. Invoiced revenue for the first half of 2021 reached \$39.6 million, an increase of 147%, or \$23.6 million year-over-year. The Kahoot! Group delivered continued solid cash flow from operations and reached 933K paid subscriptions including acquired units.
The Kahoot! platform had record-high activity in the second quarter with more than 29 million active accounts (43% YoY growth) hosting 303 million games (44% YoY growth) for more than 1.8 billion participating players (49% YoY growth) in the last 12 months, building the foundation for further growth in the coming quarters.
We are pleased to share that Kahoot! continues to deliver strong financial performance in the second quarter of 2021, and that we are progressing well in delivering on our business agenda and annual targets.
The second quarter has been our most active thus far, across all aspects of the business, including R&D and product releases, technical partner integrations, localization efforts as well as new partnerships and acquisitions. This quarter, we took significant steps in reaching our goal to become a global leading learning platform company.
Our record-high activity on the Kahoot! platform in the second quarter, including more than 29 million active accounts, 303 million games hosted and more than 1.8 billion participating players in the last 12 months, is a testament to the strength of the Kahoot! brand and our vision to make learning awesome!
We also continued the growth in paid subscriptions, reaching 933K in the second quarter. This includes all subscriptions on Kahoot!, DragonBox math curriculum, Drops language learning, Whiteboard.fi and employee licenses from Actimo and Motimate.
Last year, Kahoot! delivered very strong growth in the unprecedented second quarter and this year we achieved continued growth both organically and in total for the group year-over-year. In the second quarter this year invoiced revenue was \$20.6 million, a 114% year-over-year growth.
A key goal for Kahoot! in the second half of 2020 and first half of 2021 has been to increase momentum in building our employee engagement offering, with the overall goals of rapid solution launches to capture increased demand for online corporate learning. In April we announced the acquisition of the learning app provider Motimate and the combined user base of Motimate and Actimo, acquired in October 2020, represent more than a quarter of a million employees. This further accelerates the building of the next generation of tools for employee learning, engagement and corporate culture. The launch of the Kahoot! 360 Spirit solution in the second quarter represents our main offering to all
organizations focusing on employee engagement. Kahoot! Spirit has already been well received by new and existing customers and the first larger projects have been initiated in the quarter.
With a focus on expanding our presence and offerings, in the second quarter we also announced the acquisition of Clever, Inc, the most used digital learning platform in U.S. K-12 (kindergarten to 12th grade) schools. Kahoot! Group will acquire 100% of the shares in Clever, Inc., for an enterprise value of \$435-500 million on a cash and debt-free basis, including a performance-based element for 2021-2022. The consideration will consist of a combination of cash and Kahoot! shares. Clever will operate as an independent company in the Kahoot! Group led by its strong management team and remains an open platform operating under the Clever brand. Clever expects to reach \$44 million in billed revenues for 2021 from its U.S. ecosystem partners.
Completion of the Clever transaction is pending satisfaction of regulatory approval by The Committee on Foreign Investment in the United States ("CFIUS") and completion of the transaction is expected in the third quarter 2021. We look forward to the completion of the transaction and are excited about the value the partnership will bring to both organizations' stakeholders.
We continue to expand geographically, both through engaging new partnerships and launching localized services. In the third quarter 2020, we launched our Spanish language version and are pleased to see that Latin America is now among the fastest growing markets with more than 130% growth in active accounts over the last 12 months. Since then, we have launched several new language versions, including our first Asian language - Japanese. During the second half of 2021, Arabic and simplified Chinese will be added.
All in all, the second quarter of 2021 has been strategically important for the Kahoot! Group as we continued to make significant progress across all teams and units. Our ecosystem of services, users, customers, and partners provides a solid foundation for further scale. To capture that embedded growth, we have been adding talents and resources to support the execution of our commercial strategy. In the first half of 2021, we have built the foundation for a series of upcoming launches of new features and offerings, including Kahoot! Academy Marketplace for user groups, the full Kahoot! 360 Spirit to our business customers and our improved Kahoot! EDU for schools and school districts ready for the Back To School season.
As the global vaccine response to the pandemic has been rolled out and many schools, educational institutions as well as workplaces are gradually planning a return to a hybrid or more in-presence environment, Kahoot! continues to attract new users and subscribers across all markets and customer segments. The growth on the Kahoot! platform experienced in the first half of the year, including higher signups in the second quarter this year, provides a solid foundation for further development of customer value and commercial strategies.
We are well positioned with a strong product portfolio, scaled customer base, and team as we move into the second half of the year, to make learning even more awesome!
The main figures were reported in the company trading update 7 July 2021.
In order to enhance the understanding of the Kahoot! Group's performance, the Group presents certain measures and ratios considered as alternative performance measures (APMs) as defined by the European Securities and Markets Authority, and these should not be viewed as substitute for any IFRS financial measures. The APMs includes Invoiced Revenue, Annual Recurring Revenue (ARR), Monthly Recurring Revenue (MRR), EBITDA, adjusted EBITDA, adjusted cash flow from operations and equity ratio. These APMs are presented as the Group considers them to be important supplemental measures to understand the overall picture of revenue and profit generation in the Group's operating activities.
| USD in millions | Q 2 2021 | Q 2 20 20 | YTD 2021 | YTD 2020 | FY 2020 |
|---|---|---|---|---|---|
| Total revenue and other operating income | 18.4 | 5.6 | 34.6 | 9.8 | 31.0 |
| Invoiced revenue | 20.6 | 9.6 | 39.6 | 16.1 | 45.3 |
| ARR end of period | 75.0 | 25.0 | 75.0 | 25.0 | 60.0 |
| EBITDA before adjustments | 8.0 | (2.8) | 6.8 | (3.7) | (15.9) |
| Share based payment expenses | 1.8 | 0.4 | 3.9 | 0.5 | 3.1 |
| Social security tax share based payments | (7.3) | 1.2 | (5.9) | 1.0 | 14.2 |
| Acquisition transaction and listing cost | 1.6 | ۰ | 3.0 | ٠ | 1.0 1 |
| Adjusted EBITDA | 4.2 | (1.2) | 7.8 | (2.2) | 2.3 |
| Adjusted EBITDA margin (%) | 22.6 % | $-22.0%$ | 22.7% | $-22.2%$ | 7.5% |
| Cash flow from operating activities adjusted 1) | 5.0 | 3.9 | 10.4 | 5.0 | 17.4 |
| Cash and cash equivalents end of period | 440.5 | 73.4 | 440.5 | 73.4 | 256.1 |
1) Q2 2021 adjusted for \$1.6 million cash out flow for expenses related to acquisitions completed or announced.
Description of alternative performance measures:
assets were \$148.6, up from \$115.7 million per the end of 2020. The increase is attributable to goodwill and intangible assets from the acquisitions of Whiteboard.fi and Motimate. Current assets were \$451.0 million whereof cash and cash equivalents represented \$440.5 million.
For further information, please contact:
Eilert Hanoa, CEO Phone: +47 928 32 905 Email: [email protected]
Ken Østreng, CFO Phone: +47 911 51 686 Email: [email protected]
Kahoot! is on a mission to make learning awesome! We want to empower everyone, including children, students, and employees to unlock their full learning potential. Our learning platform makes it easy for any individual or corporation to create, share, and play learning games that drive compelling engagement. Launched in 2013, Kahoot!'s vision is to build the leading learning platform in the world. In the last 12 months, 300 million games have been played on the Kahoot! platform with 1.8 billion participating players in more than 200 countries. The Kahoot! family also includes award-winning DragonBox math learning apps, the Poio learn to read app, the Drops language learning apps, the Actimo and Motimate employee engagement and corporate platforms and Whiteboard.fi, the online whiteboard tool for all educators, teachers and classrooms. The Kahoot! Group is headquartered in Oslo, Norway with offices in the US, the UK, France, Finland, Estonia, Denmark and Spain. Kahoot! is currently listed on the Oslo Stock Exchange under the ticker KAHOT. Let's play!
| Restated | Restated | |||||
|---|---|---|---|---|---|---|
| USD in thousands | Note | Q2 2021 | Q2 2020 | H 1 2021 | H1 2020 | FY 2020 |
| Revenue from contracts with customers | 3 | 18,162 | 5,573 | 34,344 | 9,646 | 30,859 |
| Other operating income | 3 | 249 | $\overline{2}$ | 249 | 144 | 175 |
| Total revenue and other operating income | 18,412 | 5,576 | 34,594 | 9,791 | 31,034 | |
| Cost of sales | 1,707 | 660 | 3,052 | 1,067 | 3,790 | |
| Employee benefit expenses | 1,016 | 5,445 | 10,659 | 8,275 | 31,625 | |
| Other operating expenses | 7,674 | 2,258 | 14,045 | 4,148 | 11,553 | |
| Operating profit/(loss) before deprec. and amortiz. (EBITDA) | 8,014 | (2,787) | 6,838 | (3,700) | (15,936) | |
| Amortization of intangible assets | 1,775 | 329 | 3,169 | 676 | 1,897 | |
| Depreciation | 277 | 148 | 528 | 301 | 685 | |
| Operating profit/(loss) (EBIT) | 5,962 | (3, 264) | 3,141 | (4,678) | (18, 517) | |
| Financial income | 230 | 72 | 325 | 214 | 372 | |
| Financial expenses | (50) | (135) | (95) | (181) | (329) | |
| Net change in fair value of financial instruments | (593) | ٠ | (1, 321) | 848 | ||
| Net foreign exchange gains (losses) | (262) | (457) | (289) | (239) | (17, 510) | |
| Net financial income (expenses) | (674) | (520) | (1, 381) | (206) | (16, 619) | |
| Profit/(loss) before income tax | 5,287 | (3,784) | 1,761 | (4,884) | (35, 136) | |
| Income tax | (339) | (31) | (594) | (64) | (656) | |
| Profit/(loss) for the period | 5,626 | (3,753) | 2,355 | (4,820) | (34, 481) | |
| Profit/(loss) for the period is attributable to: | ||||||
| Equity holders of Kahoot! ASA | 5,626 | (3,753) | 2,355 | (4,820) | (34, 481) | |
| Earnings per share in USD | ||||||
| Basic earnings per share | 0.01 | (0.01) | 0.01 | (0.01) | (0.09) | |
| Diluted earnings per share | 0.00 | (0.01) | 0.00 | (0.01) | (0.09) |
| Restated | Restated | ||||||
|---|---|---|---|---|---|---|---|
| USD in thousands | Note | Q 2 20 21 | Q 2 20 20 | H 1 2021 | H 1 2020 | FY 2020 | |
| Profit/(loss) for the period | 5,626 | (3.753) | 2,355 | (4.820) | (34, 481) | ||
| Other comprehensive income/(loss): | |||||||
| Items that might be subsequently reclassified to profit or loss: | |||||||
| Exchange differences on translation of foreign operations | 91 | 301 | (3,680) | 411 | (325) | ||
| Item that are not reclassified to profit or loss: | |||||||
| Exchange difference on translation to another | |||||||
| presentation currency | $\overline{\phantom{a}}$ | 2,858 | $\overline{\phantom{a}}$ | (6,305) | 17,413 | ||
| Total comprehensive income/(loss) for the period | 5,717 | (594) | (1, 325) | (10, 714) | (17, 392) | ||
| Total comprehensive income/(loss) is attributable to: | |||||||
| Equity holders of Kahoot! ASA | 5.717 | (594) | (1, 325) | (10, 714) | (17, 392) |
| Restated | ||||
|---|---|---|---|---|
| USD in thousands | Note 30.06.2021 30.06.2020 | 31.12.2020 | ||
| ASSETS | ||||
| Goodwill | 2 | 99,698 | 18,108 | 77,745 |
| Intangible assets | 2 | 45,778 | 7,345 | 34,373 |
| Property, plant and equipment | 417 | 319 | 409 | |
| Right-of-use assets | 2.721 | 2.526 | 3,165 | |
| Total non-current assets | 148,613 | 28,299 | 115,692 | |
| Trade receivables | 5,109 | 610 | 2,671 | |
| Other current assets | 5,389 | 1,256 | 3,316 | |
| Cash and cash equivalents | 440,487 | 73,350 | 256,120 | |
| Total current assets | 450,985 | 75,217 | 262,108 | |
| TOTAL ASSETS | 599,598 | 103,515 | 377,800 | |
| EQUITY AND LIABILITIES | 4 | |||
| Share capital | 5,547 | 4,100 | 5,228 | |
| Share premium | 571,490 | 107,905 | 357,383 | |
| Share-based payments reserves | 9,451 | 2,415 | 5,542 | |
| Foreign currency translation reserves | (4,055) | 360 | (375) | |
| Accumulated deficit | (77, 018) | (41,010) | (79, 373) | |
| Total equity | 505,415 | 73,770 | 288,406 | |
| Lease liabilities | 1,913 | 2,072 | 2,312 | |
| Deferred tax liability | 7,952 | 1,153 | 5,843 | |
| Other non-current liabilities | 13,127 | 15,447 | ||
| Total non-current liabilities | 22,991 | 3,225 | 23,602 | |
| Lease liabilities | 909 | 542 | 964 | |
| Trade payables | 3,095 | 771 | 1,817 | |
| Contract liabilities (deferred revenue) | 33,506 | 11,806 | 27,899 | |
| Other current liabilities | 33,682 | 13,402 | 35,111 | |
| Total current liabilities | 71,191 | 26,520 | 65,791 | |
| Total liabilities | 94,183 | 29,745 | 89,393 | |
| TOTAL EQUITY AND LIABILITIES | 599,598 | 103,515 | 377,800 |
| Share-based | Translation | |||||
|---|---|---|---|---|---|---|
| Share | Share | payments | differences Accumulated | Total | ||
| USD in thousands | capital | premium | reserves | reserves | deficit | equity |
| Balance at 1 January 2020 | 1,473 | 92,621 | 2,095 | (50) | (40, 112) | 56,026 |
| Profit/(loss) for the period | $\overline{\phantom{a}}$ | $\overline{\phantom{a}}$ | $\overline{\phantom{a}}$ | ۰ | (34, 481) | (34, 481) |
| Currency translation differences | 334 | 21,480 | 378 | (325) | (4,780) | 17,088 |
| Total comprehensive income/(loss) for the period | 334 | 21,480 | 378 | (325) | (39, 261) | (17, 392) |
| Issuance of shares | 3,421 | 253,520 | $\blacksquare$ | ٠ | $\sim$ | 256,940 |
| Transaction costs on equity issues | $\overline{\phantom{a}}$ | (10, 237) | $\overline{\phantom{a}}$ | ۰ | $\sim$ | (10, 237) |
| Share option program | $\sim$ | $\overline{\phantom{a}}$ | 3,069 | ۰ | $\sim$ | 3,069 |
| Balance at 31 December 2020 | 5,228 | 357,383 | 5,542 | (375) | (79, 373) | 288,406 |
| Profit/(loss) for the period | $\overline{\phantom{a}}$ | $\sim$ | $\sim$ | ٠ | 2,355 | 2,355 |
| Currency translation differences | $\sim$ | $\overline{\phantom{a}}$ | $\sim$ | (3,680) | $\sim$ | (3,680) |
| Total comprehensive income/(loss) for the period | ۰ | ۰ | ۰ | (3,680) | 2,355 | (1, 325) |
| Issuance of shares | 319 | 222,273 | $\overline{\phantom{a}}$ | ۰ | $\sim$ | 222,592 |
| Transaction costs on equity issues | $\blacksquare$ | (8, 166) | $\sim$ | ۰ | $\sim$ | (8, 166) |
| Share option program | $\sim$ | 3,908 | ۰ | $\sim$ | 3,908 | |
| Balance at 30 June 2021 | 5,547 | 571,490 | 9,451 | (4,055) | (77, 018) | 505,415 |
| Share-based Translation | ||||||
|---|---|---|---|---|---|---|
| Share | Share | payments | differences Accumulated | Total | ||
| USD in thousands | capital | premium | reserves | reserves | deficit | equity |
| Balance at 1 January 2020 | 1,473 | 92.621 | 2.095 | (50) | (40, 112) | 56,026 |
| Profit/(loss) for the period | $\overline{\phantom{a}}$ | $\overline{\phantom{a}}$ | $\sim$ | $\sim$ | (4,820) | (4,820) |
| Currency translation differences | (285) | (9,735) | (207) | 411 | 3,922 | (5,894) |
| Total comprehensive income/(loss) for the period | (285) | (9,735) | (207) | 411 | (898) | (10, 714) |
| Issuance of shares | 2,911 | 25,836 | $\sim$ | $\sim$ | $\sim$ | 28,748 |
| Transaction costs on equity issues | $\overline{\phantom{a}}$ | (818) | $\sim$ | $\sim$ | ٠ | (818) |
| Share option program | $\overline{\phantom{a}}$ | $\overline{\phantom{a}}$ | 528 | $\sim$ | $\sim$ | 528 |
| Balance at 30 June 2020 | 4,100 | 107.905 | 2.415 | 360 | (41.010) | 73,770 |
| Restated | Restated | ||||
|---|---|---|---|---|---|
| USD in thousands | Q2 2021 | Q2 2020 | H1 2021 | H1 2020 | FY 2020 |
| Cash flows from operating activities | |||||
| Profit/(loss) before income tax | 5,287 | (3,784) | 1,761 | (4,884) | (35, 136) |
| Adjustments for: | |||||
| Depreciation and amortization | 2,053 | 476 | 3,697 | 977 | 2,582 |
| Net interest income | (50) | (135) | (95) | (181) | (329) |
| Share-based payments expense | 1,790 | 384 | 3,908 | 528 | 3,069 |
| Change in trade and other receivables | (828) | 759 | (1,951) | 580 | 279 |
| Change in contract liabilities (deferred revenue) | 2,550 | 3,799 | 5,285 | 6,326 | 13,807 |
| Change in trade payables | 565 | (381) | 1,025 | (76) | 591 |
| Change in other current assets and other liabilities | (8, 182) | 2,729 | (5,098) | 1,529 | 32,191 |
| Interest received | 230 | 72. | 325. | 214 | 372 |
| Net cash flow from operating activities | 3,416 | 3,918 | 8,857 | 5,013 | 17,426 |
| Cash flows from investing activities | |||||
| Payment for acquisition of subsidiary, net of cash acquired | (11, 974) | ۰ | (19, 390) | ۰ | (34, 227) |
| Payment for property, plant and equipment | (43) | (23) | (83) | (91) | (214) |
| Net cash from investing activities | (12,017) | (23) | (19, 473) | (91) | (34, 441) |
| Cash flows from financing activities | |||||
| Proceeds from issuance of ordinary shares | 204,038 | 33,606 | 204,038 | 32,549 | 241,931 |
| Transaction costs on issuance of ordinary shares | (8, 166) | (815) | (8, 166) | (815) | (10, 237) |
| Repayments of lease liabilities | (230) | (136) | (443) | (274) | (537) |
| Paid interest on lease liabilities | (28) | 58 | (61) | 39 | (78) |
| Net cash from financing activities | 195,613 | 32,713 | 195,367 | 31,498 | 231,079 |
| Net increase/(decrease) in cash and cash equivalents | 187,012 | 36,608 | 184,752 | 36,420 | 214,064 |
| Cash and cash equivalents beginning of the period | 253,614 | 33,986 | 256,120 | 40,851 | 40,851 |
| Effects of exchange rate changes on cash and cash equiv. | (140) | 2.756 | (385) | (3,921) | 1,205 |
| Cash and cash equivalents as of end of period | 440,487 | 73,350 | 440,487 | 73,350 | 256,120 |
Kahoot! ASA (the Company or Kahoot!), the parent company of the Kahoot! Group (the Group) is a public limited liability company incorporated and domiciled in Norway, with its head office in Fridtjof Nansens plass 7, 0160 Oslo. The Company is listed on Oslo Stock Exchange has the ticker "KAHOT".
The condensed consolidated interim financial statements consist of Kahoot! ASA and its subsidiaries. As a result of rounding differences, numbers or percentages may not add up to the total.
These interim condensed consolidated financial statements for the six months ending 30 June 2021, have been prepared in accordance with IAS 34 Interim Financial Reporting, and authorized for issue by the board of directors on 18 August 2021. The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Group's annual financial statements for 2020.
The accounting policies applied (except for the principles applied for the change in functional currency in the parent company as described below) in the preparation of the interim consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2020.
As of 1 January 2021, the parent company Kahoot! ASA changed its functional currency from NOK to USD. The indicators of functional currency changed in the second part of 2020. The company had strong growth in the last year and revenue is mainly denominated in USD, while the expenses is mainly denominated in NOK. However, financing has also moved from NOK to USD, evidenced by the contribution in the fourth quarter of 2020 held in USD.
The effect of a change in functional currency is recognized prospectively from the date of change, considered to be 1 January 2021.
Kahoot! ASA translates all items into the new functional currency using the exchange rate at the date of the change. The resulting translated amounts for non-monetary items are treated as their historical cost.
For the translation of equity items to the new functional currency the exchange rate at the date of the change of functional currency are applied. This means that no additional exchange differences arise on the date of the change. For the subsequent changes, equity items will be translated using their transaction date rate.
The comparable figures are not restated.
Motimate AS ("Motimate") was acquired by a purchase of 100% of the shares effective from 22 April 2021. Motimate, an employee engagement and learning app provider for organizations of all sizes was acquired for a total consideration reflecting an enterprise value (EV) of \$25 - 27 million on a cash and debt-free basis, including a 2021 performance-based element. The initial consideration was settled by a combination of cash and issuance of 1,104,994 shares in Kahoot! ASA at a subscription price of NOK 93.90 per share. A total of \$5 million of the initial cash consideration is deferred and expected settled at the end of the fourth quarter 2021. The deferred settlement has been recognized at its nominal value within other current liabilities.
The performance-based element (earn-out) relating to Motimate is determined based on certain operational metrics at the end of 2021. Given the contingent liability will be determined and settled in the future, the nominal value is discounted to present value. Present value of the contingent liability (earn-out) relating to the acquisition was recognized at \$1,814 thousand, whereof all is current. The main level three inputs used in assessing the fair value of the earnout is forecast of probability, cashflow and discount rate. The discount rates applied for Motimate was 12.5%.
The amounts recognized at the date of acquisition in respect of identifiable assets acquired and liabilities assumed are set out in the table below, using the exchange rate as of 22 April 2021 for Motimate.
Goodwill from the acquisition of Motimate are attributable to synergies and will lead to additional value for the Group's subscription-based product offering when combined with the Kahoot! products.
Acquisition costs of \$184 thousand arose as a result of the transaction. These have been recognized as part of other operating expenses in the statement of statement of profit or loss.
Since the acquisition date 22 April 2021, Motimate has contributed with \$830 thousand to the Group's revenue and negative net income contribution of \$526 thousand to the Group's total profit. If the acquisition of Motimate had occurred on 1 January 2021, the revenue for the Group would have been \$35,380 thousand and the Group's profit would have been \$801 thousand.
| USD in thousands | Motimate |
|---|---|
| Purchase consideration | |
| Cash consideration | 14,759 |
| Shares issued | 12,533 |
| Contingent liability / earn-out | 1,814 |
| Total purchase consideration | 29,107 |
| Brand | 666 |
| Technology | 11,328 |
| Property, plant and equipment | 5 |
| Trade and other receivables | 536 |
| Cash and cash equivalents | 2,521 |
| Deferred tax liability | (2,211) |
| Trade payables and other current liabilities | (901) |
| Total net identifiable assets acquired at fair value | 11,945 |
| Total purchase consideration | 29,107 |
| Goodwill | 17,161 |
| Net cash outflow arising on acquisition | |
| Cash consideration | 9,759 |
| Less: cash and cash equivalents acquired | 2,521 |
| Total cash consideration | 7,237 |
Digital Teaching Tools Finland Ltd ("Whiteboard.fi", hereafter referred to as Whiteboard.fi) was acquired by a purchase of 100% of the shares effective from 23 February 2021. Whiteboard.fi, an online whiteboard tool for teachers and classrooms that helps engage students both in the physical classroom and through remote learning was acquired for an initial consideration of \$6 million, in addition to a performance-based element up to \$6 million depending on Whiteboard's performance in 2021-2022. The initial consideration was settled by a combination of cash and 184,892 new Kahoot! ASA shares at a subscription price of NOK 110.39 per share.
The performance-based element (earn-out) relating to Whiteboard.fi is determined based on invoiced revenue targets in 2021 and 2022 subject to EBITDA margin and a net cash flow conversion condition. Given the contingent liability will be determined and settled in the future, the nominal value is discounted to present value. Present value of the contingent liability (earn-out) relating to the acquisition was recognized at \$4,314 thousand, of which \$2,702 thousand was non-current. The main level three inputs used in assessing the fair value of the earnout is forecast of probability, cashflow and discount rate. The discount rates applied for Whiteboard.fi was 12.8%.
The amounts recognized at the date of acquisition in respect of identifiable assets acquired and liabilities assumed are set out in the table below, using the exchange rate as of 23 February 2021 for Whiteboard.fi.
Goodwill from the acquisition of Whiteboard.fi are attributable to synergies and will lead to additional value for the Group's subscription-based product offering when combined with the Kahoot! products.
Acquisition costs of \$241 thousand arose as a result of the transaction. These have been recognized as part of other operating expenses in the statement of statement of profit or loss.
Since the acquisition date 23 February 2021, Whiteboard.fi has contributed with \$298 thousand to the Group's revenue and negative net income contribution of \$86 thousand to the Group's total profit. If the acquisition of Whiteboard.fi had occurred on 1 January 2021, the revenue for the Group would have been \$34,713 thousand and the Group's profit would have been \$2,590 thousand.
| USD in thousands | Whiteboard.fi |
|---|---|
| Purchase consideration | |
| Cash consideration | 3,600 |
| Shares issued | 2,402 |
| Contingent liability / earn-out | 4,314 |
| Total purchase consideration | 10,316 |
| Brand | 219 |
| Technology | 3,563 |
| Property, plant and equipment | 12 |
| Trade and other receivables | 68 |
| Cash and cash equivalents | 293 |
| Deferred tax liability | (756) |
| Trade payables and other current liabilities | (312) |
| Total net identifiable assets acquired at fair value | 3,086 |
| Total purchase consideration | 10,316 |
| Goodwill | 7,230 |
| Net cash outflow arising on acquisition | |
| Cash consideration | 3,600 |
| Less: cash and cash equivalents acquired | 293 |
The Kahoot! Group has one segment: software to make learning awesome. The market for Kahoot!'s software is global. The chief decision maker will therefore follow up revenue and profitability on a global basis. This is consistent with the internal reporting submitted to the chief operating decision maker responsible for allocating resources and assessing performance as well as making strategic decisions.
| Restated | Restated | ||||
|---|---|---|---|---|---|
| USD in thousands | Q 2 20 21 | Q 2 20 20 | H 1 2021 | H 1 2020 | FY 2020 |
| Subscription revenue - recognized over time | 18,041 | 5.343 | 34,042 | 9.165 | 27,746 |
| Sale to schools - recognized at point in time | $\overline{\phantom{a}}$ | $\sim$ | 2.235 | ||
| Other revenue - recognized at point in time | 121 | 229 | 303 | 482 | 878 |
| Total revenue from contracts with customers | 18,162 | 5.573 | 34,344 | 9.646 | 30,859 |
| Other operating income | 249 | 2 | 249 | 144 | 175 |
| Total revenue and other operating income | 18,412 | 5.576 | 34.594 | 9.790 | 31,034 |
Kahoot! ASA only has one class of shares, and all shares have the same voting rights. The shareholders are entitled to receive dividends as and when declared and are entitled to one vote per share at General Meetings of the Company.
| Number of shares |
Share capital (NOK) |
Share capital (USD) |
|
|---|---|---|---|
| Balance at 1 January 2021 | 446.091.967 | 44,609,197 | 5.228.090 |
| Issued during the year | 26.597.543 | 2.659.754 | 319,262 |
| Balance at 30 June 2021 | 472,689,510 | 47,268,951 | 5,547,352 |
The share capital is fully paid and has a par value of NOK 0.10.
At the Annual General Meeting of Kahoot! ASA on 8 June 2021, the Board of Directors were authorized to increase the share capital by up to NOK 9.63 million through the issuance of up to 96.3 million new shares in connection with mergers, acquisitions, equity raises and exercise of share options. The Board of Directors were authorized to acquire treasury shares with a total nominal value of up to NOK 1,418 thousand.
Information relating to the Group's Employee Option Plan, including details of options issued, exercised, and lapsed during the financial year and options outstanding at the end of each reporting period, is set out in note 17 in the 2020 Annual Report. The table below shows the development in the Company's share capital in 2021.
| Change in | New | Nominal | ||||
|---|---|---|---|---|---|---|
| Date of | share capital | share capital | value | Number of total | Subscription price | |
| registration Type of change | (NOK) | (NOK) | (NOK) | issued shares | per share (NOK) | |
| 24 Feb 21 | Share capital increase | 12,162 | 44.621.359 | 0.10 | 446,213,585 | 116.30 |
| 9 Mar 21 | Share capital increase | 18,489 | 44.639.848 | 0.10 | 446,398,477 | 110.39 |
| 27 Apr 21 | Share capital increase | 110,499 | 44,750,347 | 0.10 | 447.503.471 | 93.90 |
| 3 May 21 | Share capital increase | 18,604 | 44,768,951 | 0.10 | 447,689,510 | 86.62 |
| 20 May 21 | Share capital increase | 2,500,000 | 47,268,951 | 0.10 | 472,689,510 | 68.00 |
| Shareholders per 17 August 2021 | Shares (m) | % | |
|---|---|---|---|
| 1 | SoftBank | 82.3 | 17.4% |
| 2 | Glitrafjord | 41.2 | 8.7% |
| 3 | Datum Group | 40.1 | 8.5% |
| 4 | State Street Bank and Trust Comp | 20.3 | 4.3% |
| 5 | Creandum III LP | 20.0 | 4.2% |
| 6 | Citigroup Global Markets Inc. | 13.5 | 2.9% |
| 7 | The Bank of New York Mellon | 12.8 | 2.8% |
| 8 | Versvik Invest AS | 12.6 | 2.7% |
| 9 | State Street Bank and Trust Comp | 8.7 | 1.8% |
| 10 | Newbrott AS | 7.6 | 1.6% |
| 11 | Nordnet Bank AB | 6.2 | 1.3% |
| 12 | UBS AG | 6.0 | 1.3% |
| 13 | Euroclear Bank S.A./N.V. | 5.6 | 1.2% |
| 14 | MP Pensjon PK | 5.4 | 1.1% |
| 15 | Gamification AS | 5.2 | 1.1% |
| 16 | J.P. Morgan Bank Luxembourg S.A. | 5.1 | 1.0% |
| 17 | The Bank of New York Mellon SA/NV | 4.7 | 1.0% |
| 18 | Sanden AS | 4.5 | 0.9% |
| 19 | Pershing LLC | 3.7 | 0.8% |
| 20 J.P. Morgan Bank Luxembourg S.A. | 3.7 | 0.7% | |
| Other | 163.4 | 34.7% | |
| Total outstanding shares | 472.7 | 100.0% | |
| Outstanding share options | 21.5 | ||
| Total no. of shares (fully diluted) | 494.2 |
There have not been any changes or transactions with any related parties that significantly impact the Group's financial position or results for the period.
On 6 May 2021, Kahoot! ASA announced the agreement of acquiring 100% of the shares in Clever Inc., ("Clever"). Kahoot! Group will acquire 100% of the shares in Clever for a total consideration reflecting an Enterprise Value (EV) of \$435 - 500 million, on a cash and debt free basis, including an up to \$65 million 2021-2022 performance-based element. The consideration will be settled by a combination of approximately 82% cash and 18% Kahoot! shares. The performance-based consideration will be payable in 2022 and 2023. Completion of the Clever transaction is pending satisfaction of regulatory approval by The Committee on Foreign Investment in the United States ("CFIUS") and completion of the transaction is expected in the second half of the third quarter 2021.
No other events that have significantly affected or may significantly affect the operations of the Group have occurred after 30 June 2021.
We confirm that, to the best of our knowledge, the condensed consolidated interim financial statements for the first half of 2021 which have been prepared in accordance with IFRS as adopted by EU and IAS 34 Interim Financial Reporting, give a true and fair view of the Company's consolidated assets, liabilities, financial position and results of operation. To the best of our knowledge, the interim report for the first half of 2021 includes a fair review of important events that have occurred during the period and their impact on the condensed financial statements, the principal risks and uncertainties for the remaining half of 2021, and major related party transactions.
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Andreas Hansson Chair
Akshay Naheta Board member
Lori Wright Board member
Joanne Bradford Board member
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Stefan Blom Board member
Sarah Blystad Employee representative
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Alexander Remen Employee representative Eilert Hanoa CEO
Kahoot! kahoot.com/investor
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