Micro Systemation

Quarterly Report • Apr 29, 2021

Interim Report

• Strong results record sales for a first quarter
• Byggnadsnämnden har gett grönt ljus för detaljplanen i Södra Änggården • EMEA continues to demonstrate strong growth, with the lion's share attributable to European customers and the United Kingdom as the single market with most growth.
• Efter periodens utgång: Platzer och Bockasjö bildar JV för att utveckla • The Board proposes a dividend of SEK 2.0 per share.

Net sales SEK 70.4 (66.2) million

EBIT SEK 6.0 (-8.8) million

Cash and Cash equivalents SEK 111.1 (71.5) million

• Earnings per share before/after dilution amounted to SEK 0.35 (-0.46).
• The EBIT margin was 8.5 (-13.2) percent.
• Profit after tax amounted to SEK 6.5 (-8.5) million.

Key figures	Q1 2021	Q1 2020	Apr 20-Mar 21	Whole-year 2020
Net sales growth %	6.2	-0.0	2.1	0.8
EBIT margin %	8.5	-13.2	13.8	9.2
Equity/assets ratio %	49.7	38.2	46.3	46.8
Cash flow from operating activities / share (SEK)	0.5	0.4	2.8	3.3
Return on equity %	7.8	-9.7	37.3	17.5
Return on capital employed %	10.8	-8,1	59.5	32.2
Equity per share	5.3	3.8	4.8	4.4
Average no. of shares before/after dilution (millions)	18.5	18.5	18.5	18.5

Comments from the CEO

The first quarter of 2021 was a strong quarter for MSAB. In terms of sales, we delivered the best quarter in the Company's history, SEK 70.4 (66.2) million. The bottom line, for a quarter that historically has been our weakest due to the seasonal variation we have in sales, was SEK 6.5 (-8.8) million.

This strong quarter, together with three out of four strong quarters in 2020, sets the stage for continued growth in 2021. I am happy to report that one year after the pandemic afflicted the world, MSAB has a solid financial foundation and remains the market leader. We've adopted our way of working, which is a key contributor to our strong global sales and cash flow.

When it comes to our global sales, EMEA, and especially Europe, accounted for the largest growth. We have a strong

presence in this region, a broad customer base, and our result, as well as the feedback we receive from customers old and new, confirms our leading position. We are convinced that we will continue to grow in EMEA in 2021.

Last year we decided to reorganize our North American organization to ensure that we can fully realize the enormous potential we see on the North American market. Now that the new organization is in place, we are already beginning to see the results and we are convinced that we will see even more progress and growth throughout the rest of the year.

As we enter the second quarter, most of our customers remain in some form of lock-down, which means that they are unable to receive visitors, travel to suppliers for training, or meet for any other purpose for that matter. This situation

means that some of the more major business deals we expect in 2021 are delayed. Exactly as we did for most of 2020, we continue to adapt and overcome these obstacles so we can meet our customers.

One of the ways we have overcome the barriers that the pandemic has thrown up is through the MSAB studio we have built, from where we send live updates, conduct customer meetings, and arrange other virtual events. The feedback we have received for this new approach has been phenomenal. I believe that MSAB is best-in-class when it comes to developing innovative ways to face new challenges, and our studio is a fantastic example of just this.

Demand in the industry for products like XRY continues to grow as the need for fast extraction of data, and for accuracy in the analysis of said data, is more important than ever. The ever-increasing quantity of data and the complexity of extracted information also creates new challenges within this sector, challenges that MSAB – through its products and services – is uniquely positioned to solve.

We are also proud to have the strongest platform in the industry in the face of ever-growing cyber threats. Our file format makes it impossible to change extracted data. The standard we have set for data, i.e., that it can be verified and validated, and the log files which are automatically generated, represent yet another level of security, which sets the industry standard.

MSAB also continues to lead when it comes to personal integrity.

We were encouraged to participate in the EU's FORMOBILE project which began 18 months ago. This project will set the future standard for mobile forensics by making extraction more secure than ever before, while at the same time protecting personal integrity.

The purpose of this project is to create an end-to-end mobile forensic investigation chain, striving to improve digital safety and security from the confiscation of a mobile device all the way to producing presentable evidence. As the digital evidence becomes more crucial, the regulations for integrity and traceability increases. We are proud to be able to contribute and help set the future standard for EU in this important matter. Bottomline, it is about preserving human rights.

This initiative builds on MSAB's long-term leading position to provide a platform that does not just protect the reliability of extracted data, but which also protects the individual's integrity. MSAB' s key role in this important project is proof of our reputation and of the high standards we have for integrity and social responsibility for ourselves and for the tools we provide.

We are immensely proud of the steps we have taken thus far in 2021 and will maintain the same pace during the second quarter and the rest of the year to take advantage of the momentum that we clearly see we have.

Stockholm, April 2021

Joel Bollö, Chief Executive Officer

Strong result

Comparative figures for profit/loss items refer to the previous year's corresponding period.

Consolidated income statement in summary

		Jan - Mar		12 months
MSEK	2021	2020	Apr-Mar	2020
Net sales	70.4	66.2	314.2	310.1
Cost of goods sold	-4.8	-5.1	-27.9	-28.1
Other external costs	-10.7	-17.1	-43.3	-49.7
Personnel costs	-45.7	-49.8	-187.3	-191.3
Depreciation of fixed assets	-3.1	-3.0	-12.4	-12.3
Total operating cost	-64.4	-75.0	-270.9	-281.4
Operating profit - EBIT	6.0	-8.8	43.4	28.6
Financial income	3.0	1.6	4.9	3.5
Financial expenses	-0.8	-0.9	-9.6	-9.8
Profit/loss before tax	8.2	-8.1	38.6	22.3
Tax	-1.7	-0.5	-7.3	-6.1
Net profit/loss after tax	6.5	-8.5	31.3	16.3
Earnings per share before dilution SEK	0.35	-0.46	1.69	0.88
Earnings per share after dilution SEK	0.35	-0.46	1.69	0.88

Statement of comprehensive income

	Jan - Mar		12 months
MSEK	2021	2020	apr - mar	2020
Net profit/loss after tax	6.5	-8.5	31.1	16.3
Currency translation differences	3.0	2.0	-3.1	-4.1
Total comprehensive income	9.6	-6.5	28.2	12.2
Comprehensive income for the period attributable to the shareholders of the parent company	9.6	-6.5	28.2	12.2

Allocation of revenue

		EMEA &
MSEK Jan-Mar 2021	Asia & CIS	Latin America	North America	Total
Pro d u c t s ale s	5.1	41.8	15.9	62.8
Train in g & o th e r s e rv ic e s	0.2	6.4	0.9	7.5
Total	5.3	48.2	16.8	70.4
Re c o g n iz e d at a c e rtain p o in t in time	3.8	41.7	13.4	58.9
Re c o g n iz e d o v e r time	1.5	6.5	3.4	11.4
Total	5.3	48.2	16.8	70.4

		EMEA &
MSEK Jan-Mar 2020	Asia & CIS	Latin America	North America	Total
Pro d u c t s ale s	9.0	28.4	19.7	57.2
Train in g & o th e r s e rv ic e s	1.1	6.3	1.6	9.0
Total	10.1	34.7	21.3	66.2
Re c o g n iz e d at a c e rtain p o in t in time	8.8	29.1	16.8	54.8
Re c o g n iz e d o v e r time	1.3	5.6	4.5	11.4
Total	10.1	34.7	21.3	66.2

Interim-Report

Q1

2021

Net sales

Consolidated net sales increased 6.2 percent to SEK 70.4 (66.2) million during the quarter. In local currencies, net sales increased 13.3 percent. For comments on revenue, refer to the section Comments on operations and the associated graphs.

Expenses

Expenses for goods for resale for the quarter amounted to SEK 4.8 (5.1) million. Expenses for goods for resale depend on the product mix sold, where there was marginally less hardware sold in the current year than in the previous one, which in combination with an improved price picture for certain components has led to a stronger gross margin. Other external expenses for the quarter included depreciation in the amount of SEK 13.8 (20.1) million. The lower cost base compared with last year is partly attributable to active efforts to review and optimize the Company's resources, without sacrificing quality or other aspects of our operations. For example, consulting services were replaced by employment contracts. The ongoing pandemic has meant that significantly fewer resources were spent on travel, exhibitions, etc. MSAB identified early on the importance of finding alternatives to physical meetings with customers, and has in this way been able to maintain customer presence primarily via digital channels, without any negative impact on sales. Simultaneously, the Company had significantly lower costs related to these activities.

Personnel expenses were SEK 45.7 (49.8) million,

which is 8.4 percent lower than for last year. The lower personnel expenses are a direct effect of the number of employees declining 6.5 percent in comparison with the first quarter 2020. The Company expects to recruit personnel, primarily within development and sales, during 2021, but at the same time anticipates that the number of employees and the associated expenses will continue at a lower level than that of the previous year.

Profit/loss

EBIT for the quarter amounted to SEK 6.0 (-8.8) million, corresponding to an EBIT margin of 8.5 (-13.2) percent.

Net financial income/expense was SEK 2.2 (0.7) million for the quarter. Net financial income/expense stems primarily from revaluation of cash and cash equivalents in foreign currencies, which has been positively impacted by a weakening of the Swedish krona vis-a-vis the American dollar and the Euro during the first quarter, which benefits MSAB as most revenue is recognized in foreign currencies and then consolidated and reported in Swedish kronor. Profit/loss after tax was SEK 6.5 (-8.5) million.

Fluctuations in sales and profit

Consolidated sales and profit both tend to fluctuate between quarters, primarily due to our customers' purchasing patterns and single, larger orders. This is illustrated in the diagram below, where the substantial variation between individual quarters is clearly visible for sales and profit. Viewed over a one-year period, the trend is more even and stable for sales and profit.

Strong financial position

Comparative values for balance sheet items refer to March 31, 2021.

Consolidated balance sheet in summary

		31-mar
MSEK	2021	2020	2020
ASSETS
Intangible assets	-	0.0	0.0
Tangible assets	1.9	2.6	2.2
Assets with right to use	18.0	27.3	20.8
Deferred tax asset	0.0	0.5	0.0
Total non-current assets	19.9	30.4	23.0
Inventories	7.7	9.1	8.1
Accounts receivable - trade	48.9	55.8	46.1
Current tax asset	0.4	6.0	0.5
Other current assets	9.3	10.1	9.8
Cash and cash equivalents	111.1	71.5	101.2
Total current assets	177.4	152.4	165.7
TOTAL ASSETS	197.3	182.8	188.7
EQUITY AND LIABILITIES
Equity	98.0	69.8	88.3
Long term leasing liabilities related to assets with right to use	5.7	16.3	19.2
Accounts payable - trade	5.2	4.5	6.0
Current tax liability	2.0	1.9	1.1
Leasing liabilities related to assets with right to use	10.6	11.9	7.8
Other current liabilities	75.8	78.4	66.3
Total current liabilities	93.7	96.7	81.2
TOTAL EQUITY AND LIABILITIES	197.3	182.8	188.7

Change in equity in summary

	31-mar	31-dec
MSEK	2021	2020	2020
Opening balance	88.4	76.1	76.1
Profit/loss for the period	9.6	-6.5	12.2
Dividend	-	-	-
Equity at the end of the period	98.0	69.6	88.3

Cash flow statement in summary

	Jan-Mar		12 months
MSEK	2021	2020	Apr-Mar	2020
Profit after paid tax and non-cash items	13.7	-4.8	51.7	33.1
Working capital changes	-4.2	14.0	0.7	19.0
Cash flow from operating activities	9.4	9.2	52.4	52.0
Investments in fixed assets	0.0	-0.1	-0.5	-0.6
Cash flow from investing activities	0.0	-0.1	-0.5	-0.6
Amortization of leasing liability	-2.8	-2.6	-10.8	-10.6
Cash flow from financing activities	-2.8	-2.6	-10.8	-10.6
Cash flow for the period	6.7	6.4	41.2	40.8
Cash at the beginning of the period	101.2	64.0	71.5	63.9
Exchange rate difference in cash	3.2	1.1	-1.4	-3.5
Cash at the end of the period	111.1	71.5	111.3	101.2

Cash flow

MSAB has a strong cash flow and a solid financial position. Cash flow from operating activities was SEK 9.4 (9.2) million for the quarter.

Cash flow for the period was SEK 6.7 (6.4) million. On 31 March, 2021 cash and cash equivalents were SEK 111.1 (71.5) million. In addition to cash and cash equivalents, there was, as of 31 March, 2021, an unutilized bank overdraft of SEK 10 million. The decrease in trade receivables is primarily attributable to active efforts relating to payment conditions and following up with customers to shorten the length of time before payments are received, thereby improving cash flow.

The Parent Company

The Parent Company's net sales for the period were SEK 54.1 (42.2) million. EBIT for the period was SEK 5.0 (-10.5) million. Investments for the period amounted to SEK 0.0 (0.0) million, which were essentially IT-related. There were 144 (151) employees in the Parent Company at the end of the period. Risks and uncertainty factors are the same for the Parent Company as for the Group. The Parent Company's net sales and EBIT essentially follow the Group's earnings trend. Hence comments about the consolidated profit/loss trend apply to the Parent Company as well.

Parent company income statement in summary

	Jan-Mar
MSEK	2021	2020
Net sales	54.1	42.2
Cost of goods sold	-4.8	-5.1
Other external costs	-7.3	-10.3
Personnell costs	-34.1	-34.6
Depreciation of fixed assets	-2.9	-2.7
Total operating cost	-49.1	-52.7
Operating profit - EBIT	5.0	-10.5
Net financial items	2.3	0.6
Profit/loss before tax	7.3	-9.9
Tax	-	-
Net profit/loss after tax	7.3	-9.9

Statement of comprehensive income

		Jan-Mar
MSEK	2021	2020
Net profit/loss after tax	7.3	-9.9
Total comprehensive income	7.3	-9.9

Parent company balance sheet in summary

	31-mar
MSEK	2021	2020
ASSETS
Intangible assets	0.0	0.0
Tangible assets	1.9	2.6
Assets with right to use	17.5	25.5
Shares in group companies	0.4	0.4
Total fixed assets	19.9	28.5
Inventories	7.7	9.1
Accounts receivable - trade	14.0	13.0
Other current assets	44.4	21.4
Cash and cash equivalents	47.1	41.4
Total current assets	113.2	84.9
TOTAL ASSETS	133.1	113.4
EQUITY AND LIABILITIES
Share capital	3.8	3.8
Share premium	28.1	20.3
Restricted equity	31.9	24.1
Statutory reserve	7.8	7.8
Profit brought forward	31.3	4.8
Non-restricted equity	39.1	12.6
Total equity	70.9	36.7
Long term leasing liabilities related to assets with right to use	5.1	15.6
Accounts payable - trade	3.5	3.8
Current tax liability	-	-
Short term leasing liabilities related to assets with right to use	10.6	10.7
Other current liabilities	42.9	46.6
Total current liabilities	57.1	61.1
TOTAL EQUITY AND LIABILITIES	133.1	113.4

2021

Other comments

Employees and organization

As of 31 March, 2021, there were 188 (201) employees. The average number of employees was 190 (201).

Seasonal effects

MSAB is not dependent on the seasons in the sense that is normally meant by the term seasonal effects. However, the majority of the Company's customers have a purchasing pattern that follows their budget period. Budget periods differ between countries, but most common in MSAB's largest markets is that they follow the calendar year or end on 30 September. Historically, this has been reflected in sales in such a way that the second half of the year is stronger than the first.

Risks and uncertainty factors

Through its operations, the Group is exposed to risks and uncertainty factors. Information on risks and uncertainties other than currency exposure due to foreign subsidiaries and the fact that most invoicing in Sweden is denominated in foreign currencies can be found in more detail in the 2020 Annual Report. The Annual Report is available on the Company's website.

MSAB is monitoring developments regarding Corona virus Covid-19 and is evaluating the extent to which it can impact the Company's operations in the short- and long-term. It is currently not possible to assess the extent of impact on operations. MSAB is active on a market that is relatively stable when it comes to market fluctuations, as law enforcement authorities around the world represent the lion's share of the customer base. It is the Company's assessment that this partially explains why Covid-19 has not significantly impacted the Company's strategies, objectives, or results. The possibility of meeting customers and other stakeholders at conferences, exhibitions or other contexts has become significantly more difficult, just as it has for many others. The Company recognized this early in 2020 and has to a large degree adapted its operations to facilitate digital meetings and digital training, which has been appreciated by many customers.

Because of the general uncertainty prevailing world-wide regarding the duration of the current circumstances, the Company is experiencing that customers need more time for their decision-making processes, something that has resulted in a postponement related foremost to new sales in some markets.

Related party transactions

The related party transactions of an ongoing nature that exist in the Company are almost exclusively intra-Group transactions. These are described in the 2020 Annual Report on page 51. Besides these agreements, there are no significant related party transactions.

Accounting principles

This report has been prepared for the Group in accordance with the Swedish Annual Accounts Act and IAS 34 Interim Financial Reporting, and for the Parent Company in accordance with the Swedish Annual Accounts Act and Swedish Financial Reporting Board's recommendation RFR 2 Accounting for Legal Entities. Information as per IAS 34 is reported in notes and in other places throughout the report. The accounting principles adopted by the Group and the Parent Company are consistent with the accounting principles used to prepare the most recent annual report. For current financial assets and liabilities, the reported value is a reasonable estimate of fair value.

Significant events since end of period

No significant events have occurred since the end of the period.

Stockholm, April 29, 2021 Micro Systemation AB (publ)

Joel Bollö, Chief Executive Officer

This report has not been reviewed by the Company's auditors.

Financial Calendar 2021

Interim report January–March	29 April	8.00 am
Annual General Meeting	11 May	6.00 pm
Interim Report January–June	22 July	8.00 am
Interim Report January-September	28 October 8.00 am
Interim Report January-December		27 January 2022 8.00 am

For more information, visit msab.com or contact Joel Bollö, CEO, phone +46-8 739 02 70 Daniel Hilmgård, CFO, phone +46 709-968 333

Comments on operations

Just as for previous quarters, EMEA & Latin America continue to demonstrate strength. We see great interest in our products and services on existing and new markets, with the United Kingdom as a strong contributing factor for growth when it comes to new sales as well as for additional sales and extensions of existing agreements. Our product "Frontline forensics" has performed very well in UK during the quarter. Frontline forensics is our packaged software solutions combined with devoted hardware, integrated with our "management software" XEC.

North America has started to show signs of recovery especially under the quarter's last month. Due to vaccination efforts related to Covid-19, the region is slowly starting to return to normal, and we see that opportunities to meet and for business are both on the rise.

At the same time, we see some impact from the "defund the police" movement, as some investment decisions are prolonged. This is true for both existing and potential customers, and particularly within the customer segment State and Local.

As the fiscal year for federal agencies in the USA ends in September, most investments in products and services like MSAB's link directly to this timing, as well as to the early fourth quarter. Hence, we will not have a clear picture until then of how the current climate and political movements within the USA will affect authorities' ability to invest in our products.

Asia and CIS (Commonwealth of Independent States) – We see a decline in sales in the region, while at the same time demand remains strong. This paradox is partly attributable to our decision to shut down operations in Hong Kong in 2020 impacting sales in the region. This has not yet been fully compensated through other revenue streams.

MSAB is subject to export control of its products and services as regulated by the Swedish Inspectorate of Strategic Products (ISP). As of 2021, the ISP sharpened its restrictions relating to countries to which export is possible, with many affected countries located within this region – an additional factor contributing to the result.

A decline in sales for the region will very probably continue to impact sales in the coming quarter. However, the strong interest we see in the region, partly on new markets where we during the last couple of years have established local presence with personnel, mainly in India and Japan, is starting to show result and good opportunities for future growth.

Products

'

In our three product suites XRY, XAMN and XEX (for extraction, analysis and mobile data reporting), substantial progress has been made. MSAB's has an ongoing mission to improve our forensic solutions in order to help investigators speed up their operations, swiftly acquire more mobile data and take the data analysis to the next level, to be able to solve different type of crimes.

Mobile phone security measures have grown increasingly sophisticated in recent years, with evolutions in passcode complexity, thumbprints and facial recognition. In particular advanced encryption is a challenge for most law enforcement organizations. At MSAB we understand that to access data, investigators need to bypass security locks or acquire passcodes. The latest XRY release includes integrated support for physical extraction that bypasses most locked Huawei Kirin devices. These devices are some of the most demanded by our customers. A demand MSAB can meet with this update.

When it comes to data analysis, MSAB previously introduced the capability to automatically link profiles identified as related in a criminal investigation. This helps investigators focus on people of interest and build a complete profile of a person, using all possible available identifiers. The new release enhances this ability by introducing an updated "Connection view" feature to our analytical tool, XAMN. This facilitates faster linking and filtering of persons of interest in order to map the relationships between them.

From a sales perspective, products like Frontline and XAMN are the ones making up for the largest percentual growth compared to last year. These are the products MSAB previously have highlighted as important to help improve and simplify the work for our customers in their work. Therefore it is gratifying to see that the work put into developing these products is beginning to yield results.

Training

Revenues from training has decreased slightly compared to last year. Training revenues generally correlate with how the company's general development in sales, but with some delay. Covid-19 has meant a transition to more digital training, something that has been successful and appreciated by customers. However, there are still a number of customers, mainly in North America with requirements for physical education, which has contributed to the reduction in revenue compared with the previous year. However, we do not see a general decrease in the demand for training.

Q1

2021

Interim-Report

Q1 2021

The share and shareholders

The share

MSAB's B share was first listed in 1999 and has been listed on Nasdaq Stockholm Small Cap (ticker symbol: MSAB B) since December 2011. The Company's share price as of 31 March, 2021 was SEK 39.00 per share, corresponding to share capital of SEK 747 million calculated on the number of shares outstanding.

Share capital

Share capital in MSAB amounted to SEK 3,834,400 at yearend, with 19,172,000 shares with a nominal value of SEK 0.20. The Company has three classes of shares: Series A and B shares have equal rights to the Company's assets and profit; C shares do not entitle the holder to dividends. Every Series A share entitles the holder to ten votes and every Series B and C share entitles the holder to one vote. The number of shares in Series A is 1,000,000 and in Series B is 17,550,000. The number of Series C shares is 622,000, all held in treasury. Additionally, 81,596 Series B shares are held by the company.

The latest change in share capital occurred in the third quarter of 2018 when MSAB completed a new share emission of 15,000 B shares related to conversion of a stock option program.

Dividend policy and dividend

The Board has adopted a dividend policy whereby at least 30 percent of the Company's reported profit shall be returned to shareholders if this is compatible with maintaining adequate equity for going concern.

Ownership

The number of shareholders as of 31 March was 3,884 (3,521).

Information to shareholders

MSAB's website (msab.com) is the main information channel and all press releases and financial reports are published there. Press releases and reports can be received via email as they are published. Presentations, general information on the share, the Corporate Governance Report and financial data can also be found on the website.

Micro Systemation AB (publ) – share price development over time

MSAB (publ) largest shareholders as per March 31 2021

Name	A-shares	B-shares	C-shares	Capital	Votes	% Votes	% Capital
Henrik Tjernberg	865 000	65 422		930 422	8 715 522	30,94	4,85
Edastra AB	135 000	1 143 592		1 278 592	2 493 592	8,85	6,67
Nordnet Pensionsförsäkringar AB		1 981 820		1 981 820	1 981 820	7,03	10,34
Strawberry Capital A/S		1 450 419		1 450 419	1 450 419	5,15	7,57
Försäkringsaktiebolaget Avanza Pension		1 360 349		1 360 349	1 360 349	4,83	7,10
Öhman Sweden Micro Cap		843 313		843 313	843 313	2,99	4,40
Sijoitusrahasto Aktia Nordic Mic		750 000		750 000	750 000	2,66	3,91
Alcur Select		618 237		618 237	618 237	2,19	3,22
Grenspecialisten Förvaltning AB		574 612		574 612	574 612	2,04	3,00
Christian Axel Kock		527 538		527 538	527 538	1,87	2,75
Total 10 largest shareholders	1 000 000	9 315 302		10 315 302	19 315 402	68,56	53,80
Micro Systemation AB		81 596	622 000	703 596	703 596	2,50	3,67
Other		8 153 102		8 153 002	8 153 002	28,94	42,53
Totalt number of shares	1 000 000	17 550 000	622 000	19 172 000	28 172 000	100,00	100,00

Quarterly data

Q2 Q1 Q4 Q2 Q1 Q4 Q1 Q4 Q3 Q3 Q3	Q2 Q1 63.0 65.3
Net sales, MSEK 70.4 66.7 93.3 83.9 66.2 84.0 93.3 64.1 66.3 86.2 89.4
EBIT, MSEK 6.0 -4.0 29.4 12.1 -8.8 3.7 19.8 -11.5 -5.6 8.7 20.1	0.1 3.7
EBIT-margin, % 8.5 -6.0 31.5 14.4 -13.2 4.4 21.2 -17.9 -8.6 10.1 22.5	0.2 5.6
Earnings per share, SEK 0.35 -0.38 1.16 0.56 -0.46 0.07 1.03 -0.58 -0.23 0.40 0.79	0.07 0.24
Return on equity, % 7.8 -8.5 24.6 15.7 -9.7 1.5 21.2 -15.4 -3.9 6.6 14.4	1.8 3.8
Return on capital employed, % 10.8 -4.3 34.5 21.7 -8.1 4.8 23.2 -14.0 -3.2 9.5 20.7	3.3 6.5
Equity ratio, % 49.7 46.8 47.5 41.2 38.2 40.0 40.3 33.7 49.2 57.2 55.2	53.4 59.8
Cash flow from operations/per share, SEK 0.51 2.56 -0.15 -0.08 0.36 0.57 0.73 0.04 -0.38 1.57 -0.69	-0.62 0.01
Equity per share, SEK 5.30 4.78 5.29 4.19 3.78 4.12 4.14 2.98 5.79 5.96 5.58	4.59 6.53

Definitions

MSAB presents certain financial metrics in the interim report that are not defined under IFRS. The company believes that these metrics provide valuable supplementary information to investors and the company's management as they allow for evaluation of the company's performance. Because not all companies calculate financial measures in the same way, these are not always comparable with metrics used by other companies. These financial metrics should therefore not be regarded as replacements for

metrics defined in accordance with IFRS. The table below presents the alternative key figures that have been deemed relevant.

The key figures are based on reports on earnings, financial position, change in equity and cash flow. In cases where the key figures cannot be directly derived from the above reports, the derivation and calculation of these are shown below.

Metrics not defined under IFRS	Definitions and calculations
EBIT	Earnings before interest and taxes.
EBIT-margin	EBIT in relation to net sales
Earnings per share*	Profit/loss after tax in relation to average number of outstanding shares.
Return on equity	Profit/loss after tax in relation to average adjusted equity
Return on capital employed	EBIT plus financial items in relation to average capital employed.
Equity ratio	Equity in relation to total assets.
Cash flow from operations / per share	Cash flow from operations in relation to average number of outstanding shares.
Equity per share	Equity in relations to outstanding shares at the end of the period.
Average adjusted equity	Average equity during 12 months-period. Opening plus closing shareholder's equity divided by two.
Capital employed / Average capital employed	Capital employed is calculated as total assets less non- interest-bearing liabilities. Average capital employed is calculated as capital employed over a 12 months-period. Capital employed at beginning of period plus capital employed at end of period divided by two.
Revenue growth, %	Sales current period in relation to same period previous year.
Net financial items	Net of financial income and expenses.

* Defined under IFRS

Reconciliations of measurements that are not defined under IFRS.

Capital employed

	2021	2020				2019				2018
	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2	Q1
Total assets, MSEK	177.4	165.7	205.8	188.0	182.8	190.1	189.7	163.2	217.4	192.5	186.9	158.3	200.9
Accounts payables, MSEK	-5.2	-6.0	-3.4	-4.3	-4.5	-4.6	-5.5	-3.1	-3.9	-3.7	-4.5	-4.7	-10.9
Tax liabilities, MSEK	-2.0	-1.1	-5.8	-1.1	-1.9	-1.2	-0.8	-1.3	-0.9	-0.5	-6.9	-2.5	-2.1
Leasing liabilities related to assets with right to use	-16.3	-27.0	-21.7	-24.3	-25.7	-28.3	-30.8	-33.1	-32.8	-	-	-	-
Other liabilities, MSEK	-75.8	-66.3	-77.1	-80.9	-78.4	-79.9	-76.2	-70.5	-72.8	-78.2	-72.4	-35.2	-67.9
Capital employed, MSEK	78.0	65.3	97.7	77.4	72.3	76.1	76.5	55.2	107.0	110.1	103.1	115.9	120.0
Average capital employed, MSEK	75.1	70.7	87.1	66.3	89.6	93.1	89.8	85.5	113.5	112.4	101.8	93.5	114.2

Interim-Report

Q1

2021

MSAB in brief

MSAB is an international actor within the field of mobile forensics. The Company supplies systems for extraction and analysis of data from digital devices such as mobiles, tablets, and drones, as well as products which can unlock digital devices, extract information, and then decrypt it.

The Company stands for new ways of working to secure the chain of evidence - quicker, simpler, and more efficiently - and in this way creates great value for the Company's customers such as law enforcement agencies, the military, intelligence services, customs and migration authorities, and corrections. MSAB has clear growth strategies combined with a business model that entails scalability and a high degree of recurring revenues. The Company is represented in 17 countries and is listed on the Stockholm stock exchange.

Business concept

The Company's business concept is to deliver solutions that help law enforcement agencies worldwide to work more effectively in securing evidence recovered from digital devices.

Strategies

MSAB has identified several basic prerequisites that the Company sees as crucial for successful operations and thus for value creation for shareholders.

Product and service quality assurance

MSAB shall be the best provider of quality systems for extraction and analysis of data from digital devices. The ability to unlock digital devices, extract information and then decrypt it is central for MSAB's success. A strong development department is necessary to achieve this. It is not just about building advanced systems with a high degree of functionality. Adapting the systems to end users and situations is just as important. Quality also entails a high degree of delivery assurance and first-class support.

Market presence

To be the best provider within a geographic market, MSAB must understand users' needs and conditions at the local level. As of 2021, MSAB is represented in 17 countries with its own staff and in a further 60 countries via various partnerships. Through this representation on many geographic markets, either through its own establishments or via partners, proximity to existing and potential customers is created.

License renewals

Through annual product license renewals, MSAB creates the prerequisites for continuous investment in expanded support for new models of digital devices as well as new functions, thereby successively refining products for customers. The continuous development of phones and applications drives both MSAB and our customers to continuously update software. This is a strong driving force behind the high degree of license renewal.

Growth

MSAB operates on a market with a high level of underlying growth. By investing long-term in product development, market presence and organisational strength, MSAB consolidates its market position. The Company is convinced that the need for professional tools for recovery and analysis of data from digital devices will continue to rise. MSAB is mainly focused on organic growth but in some cases also evaluates acquisitions.

Sustainability

The Company's business concept is to deliver solutions that help law enforcement agencies be more effective in their work in recovering evidence from digital devices. This means that the Company, through its solutions, strives to create a more legally secure society where a greater number of crimes are solved and prevented, which in turn means that the Company's entire existence is a major contribution to a more sustainable society. Because the Company essentially develops software, the impact on the environment is limited, but the Board strives to follow the environmental requirements of the various markets where the Company is active.

https://www.msab.com/products/