Atea — Earnings Release 2009

Feb 3, 2010

Atea Q4 2009 financial results

Highlights Q4 2009

· Revenue of MNOK 4,409.1, down 6.4% y-o-y,

flat in constant currency

· EBITDA of MNOK 234.5, up 22.5%

· EBITDA margin of 5.3%, up from 4.1%

· EBIT of MNOK 151.4

· Cash flow from operations of MNOK 538.9, up

from MNOK 309.0

· Acquired four companies specialized within

video conferencing, AV solutions, IP telephony,

wireless and cable infrastructure and software

license sales

· Proposed dividend per share of NOK 1.25 for

2009

Full year 2009 overview

EBITDA for the full year ended at MNOK 550.3,

representing an EBITDA margin of 3.8%, which is up

from MNOK 547.5 and 3.7% in 2008, achieved in a

very challenging market. Revenue ended at MNOK

14,588.6 versus MNOK 14,767.8 in 2008, which is down

1.2%.

The Atea Group generated MNOK 731.8 in cash from

operations in 2009, which is up from MNOK 501.3 in

2008. Net interest bearing debt was MNOK 214.1 as of

December 31, 2009 and the operational gearing

measured by net interest bearing debt divided by full

year EBITDA was 0.4. This underlines the solid

financial position of the company. Acquisitions of

MNOK 55.8 and dividends of MNOK 91.7 were paid in

2009. The Board proposes to the General Assembly to

pay dividend of NOK 1.25 per share for 2009.

Actual Q4 2009 vs. actual Q4 2008

Group

Group EBITDA for Q4 2009 ended at MNOK 234.5, which

is up from MNOK 191.4 in Q4 2008, representing an

EBITDA margin of 5.3% which is up from 4.1% in the

corresponding period last year.

The improvement in EBITDA is mainly due to full

effects of the cost saving programme initiated

earlier in 2009. Total operating cost in Q4 2009 is

MNOK 82.0 or 9.5% lower than comparable quarter last

year. Total revenue was MNOK 4,409.1, down by 6.4%,

but flat in constant currency. This is achieved in a

challenging market and Atea has continued to gain

market shares. Earnings before taxes were MNOK 132.5

and earnings after taxes were MNOK 233.1, reflecting

MNOK 100.6 in recognition of deferred tax assets.

Norway

Revenue in Norway in Q4 2009 was MNOK 1,048.2, which

is down 8.0% compared to same period last year.

Services revenue was down by 1.5% and product revenue

fell by 9.5% in a challenging hardware market. EBITDA

ended at MNOK 55.9 and a margin of 5.3% which is up

from MNOK 35.3 and a margin of 3.1% in Q4 2008. The

margin improvement is due to the reduction in

operating cost from the cost programme combined with

a higher gross margin on products caused by positive

USD effects and change in the product mix.

In December 2009 Atea acquired Uni Networks AS which

is specialized in delivery of wireless and cabled

infrastructure and green datarooms. Enterprise value

was MNOK 4.2 and the acquired business is expected to

generate revenue of MNOK 20 and EBITDA of MNOK 1.5 in

2010. In Q4 a seven year agreement with Altibox of

NOK 1.4 billion was signed and Atea shall deliver

logistic services to Altibox partners and roll-out of

broadband and alarm products to fibre customers.

Order backlog is strong going into 2010.

For the full year 2009 the revenue was MNOK 3,566.3,

up 1.7% y-o-y. EBITDA for the year ended at MNOK

134.4, a margin of 3.8%.

Denmark

Denmark continues to deliver strong results despite

the economic slowdown. Fourth quarter EBITDA ended at

MNOK 103.4, a margin of 6.5%, compared to MNOK 81.4

and a margin of 5.0% in Q4 2008. Revenue in Q4 was

MNOK 1,592.8 compared to MNOK 1,635.5 in Q4 2008. The

revenue is slightly down in NOK, but represents an

increase of 0.6% in constant currency. Services

revenue grew by 4.7% and product revenue fell by 0.5%

(in constant currency). In view of the market

development Atea gained market shares and continued

to improve its already strong market position. Order

backlog is strong going into 2010. The improvement in

EBITDA is mainly explained by positive effects of the

tight cost control program implemented earlier this

year.

Atea entered into an agreement to acquire Calamus

Danmark which is a leading videoconferencing and AV

solutions company with effect from January 5, 2010.

Enterprise value was MNOK 101.3. In the fiscal year

ending March 2010 the acquired business is expected

to generate revenue of MNOK 251.5 and EBITDA of MNOK

18.3. Atea also entered into agreement to transfer

software business from Aprismo to Atea. The

transaction was an asset deal with a payment of less

than DKK 100,000. Revenue is expected to be MNOK 21

the first 12 months with a positive EBITDA.

In Q4, a frame agreement was signed with TDC (MNOK

226 in 2010) regarding sales and administration of

business broadband products. Additionally, two

agreements were signed with the Danish State (MNOK

160 in 2010) to deliver video conference and

audiovisual equipment.

For the full year 2009 the revenue was MNOK 5,259.6,

up 3.3% y-o-y, representing a reduction in constant

currency of 2.8%. EBITDA for the year ended at MNOK

264.8, a margin of 5.0% and up from MNOK 221.4 and a

margin of 4.3% in 2008.

Sweden

Revenue in Sweden in Q4 was MNOK 1,228.6 which is

down 9.8% compared to Q4 2008. In constant currency

the reduction was 3.8%.This implies that Sweden

continues to gain market shares in a challenging

market. Product revenue was down 2.1% and services

revenue was down 10.8% with 69 less consultants.

EBITDA ended at MNOK 61.4 compared to MNOK 71.8 in Q4

2008. The reduction is mainly explained by lower

revenue compensated partly by effects of the cost

reduction programme. Order backlog is strong going

into 2010.

In Q4 an agreement to deliver 11,000 PCs to Gävle

municipality worth MNOK 40 in 2010 was signed.

For the full year 2009 the revenue was MNOK 3,965.9,

down from MNOK 4,284.2 in 2008, a reduction of 7.4%.

In constant currency the reduction is 3.8%. EBITDA

for the year ended at MNOK 137.9, a margin of 3.5%

and down from MNOK 160.1 and a margin of 3.7% in 2008.

Finland

Revenue in Finland in Q4 was MNOK 428.1 which is up

from MNOK 423.9 in Q4 2008. In constant currency the

growth was 5.7%. Acquisition of A Communication was

included from November 2009 with MNOK 14.5 in

revenue. EBITDA ended at MNOK 11.7 compared to minus

1.5 in Q4 2008. Restructuring cost of MNOK 3.6 was

expensed in Q4 2008. The strong improvements in

results are mainly explained by improved gross

margins combined with tight cost control. In

addition, the acquisition of A Communication

contributes positively to the result in fourth

quarter with MNOK 2.5. Order backlog is strong going

into 2010.

Atea acquired A Communications in Finland, which is a

leading videoconferencing and IP telephony company.

Enterprise value was MNOK 13.6 - MNOK 28.2 dependent

on performance in 2010 and 2011. In 2009 the acquired

business generated revenue of MNOK 49.8 and EBITDA of

MNOK 5.5. In Q4, a frame agreement with a Finnish

catering company of MNOK 54.1 over three years was

signed to deliver IBM Point-of-Sales system roll out

to the company's 800 restaurants throughout Finland.

For the full year 2009 the revenue was MNOK 1,501.4,

up 4.3% y-o-y. EBITDA for the year ended at MNOK

13.0, a margin of 0.9%, up from an EBITDA of MNOK 0.3

in 2008.

The Baltics

The revenue in the Baltics in Q4 was MNOK 115.1 which

is down from MNOK 159.6 in Q4 2008, a reduction of

27.9%. The continued lower revenue y-o-y reflects the

challenging market in the Baltic countries. Order

backlog end of 2009 was MNOK 102 which is up from

MNOK 80 at the end of 2008. EBITDA ended at MNOK 4.2,

a margin of 3.6% compared to MNOK 6.9 and a margin of

4.3% in Q4 2008. The very satisfying results in Q4

2009 in the current Baltic markets is a result of the

effects of the cost reduction programme implemented

earlier in 2009.

The Baltic IT markets continued being under pressure

in Q4 2009. However, the Baltic markets are still

expected to receive EU fundings available for the

public sector in the coming years and this will

induce continued IT investments in the region.

For the full year 2009 the revenue was MNOK 299.5,

down 34.1% y-o-y. EBITDA for the year ended at MNOK

9.8, a margin of 3.3%, down from an EBITDA of MNOK

20.9 in 2008.

Non-core project

As announced in a Stock Exchange Announcement June

27, 2008, Atea A/S in Denmark resumed ownership of a

non-core software development project to the Danish

Ministry of Food, Agriculture and Fisheries (DFFE).

In Q3 2009 Atea reported, in light of the delays,

extra costs of approximately MNOK 35.0 to be booked

in Q4 2009. The estimated extra costs are based on

Traen A/S exercising its option to re-acquire the

project after delivery.

The development project is now completed except for

the operational testing and cost of MNOK 32.3 is

booked as non-core cost in Q4 2009. Payment from the

customer of MNOK 28.0 was received in December 2009.

The deferred payment for acquiring these businesses

of MNOK 53.1 are agreed to be paid by Traen A/S after

project delivery. The payment structure is a linear

payment schedule over the next 48 months. The full

amount shall be paid to Atea no later than December

31, 2013.

This project is the last non-core project from the

2006 restructuring of the former Ementor Group, today

named Atea.

Outlook

The macroeconomic turbulence during 2009 has affected

the Group's organic growth in 2009 but Atea has still

gained market shares in its home markets.

According to IDC forecast from November 2009, the

total Nordic IT infrastructure market targeted by

Atea is expected to decline by 5.6% in 2009. Hardware

sales are forecasted to decline by 14.0%, software to

grow by 2.5% and services to grow by 0.5% in value.

Important technology trends, such as Unified

Communication, Mobile Infrastructure Solutions,

Virtualisation, Software Asset Management, Desktop

Lifetime Management, Windows 7 and Green IT, areas in

which Atea has established a strong presence, will

help fuel IT investments going forward.

In 2010, IDC forecast a total growth of 1.2%.

Atea is expecting to continue gaining market shares

during 2010. The cost base has been trimmed during

2009 and in Q4 2009 the cost base is MNOK 82.0 or

9.5% lower than Q4 2008. This implies that the run

rate going into 2010 is lower than the run rate going

into 2009.

It is expected that the positive organic development

in 2010 will be supplemented by growth through

acquisitions, as Atea has the financial strength and

clear intent to play an important role in the ongoing

market consolidation.

Equity and cash flow

Shareholders' equity as of December 31, 2009 was MNOK

2,809.5 and minority interests were MNOK 3.7

corresponding to an equity ratio of 39.3%. This is up

from 34.5% compared to December 31, 2008.

The Group has generated operational cash flow of MNOK

731.8 for the full year 2009 and MNOK 538.9 of this

was generated in Q4, 2009. The working capital has

decreased significantly during Q4, 2009. This is

partly due to a successful internal focus on cash

flow which has resulted in a decreased amount of

overdue receivables. Furthermore, the decrease in

working capital is partly explained by prepayments

from public sector, extraordinary VAT refund of MNOK

30 and cash from the non core project of MNOK 28. The

working capital ratio end of 2009 was 0.5% which is

considerably below the ratio of 2.4% end of 2008.

Ordinary investments in Q4, 2009 were MNOK 60.2. The

Group has made investments of MNOK 21.7 related to an

internal IT infrastructure project. There has also

been made ordinary investments of MNOK 19.1 related

to the non core project. The investments in these two

above mentioned projects are reclassifications and

have no real cash flow effect in Q4, 2009. Total

payments regarding acquisitions in Q4, 2009 was MNOK

5.3 and is related to the Finnish company A

Communications and Norwegian company Uni Networks.

Cash flow from equity transactions was MNOK 17.7 in

Q4, 2009 and is related to sale of own shares for the

option program and employee share purchase offer.

The net interest bearing position end of 2009

compared to end of Q3, 2009 decreased by MNOK 495.3

from MNOK 709.4 to MNOK 214.1. Cash reserves

including unutilised credit facilities end of 2009

were MNOK 1 536.5.

Note:

· The interim financial statements have been

prepared in accordance with IFRS standard for interim

financial reporting (IAS 34). The statements are

consistent with accounting principles used in the

financial statements for 2008, plus IFRS 8, IAS 23

(Revised), IFRS 2 (Amendment), IAS 1 (Revised).

Enclosures on [http://www.newsweb.no]

Please go to [http://www.atea.com/reports] for the

quarterly report and presentation.

Video of the press conference is available at

[http://www.atea.com/webcast]

For further information, please contact:

Claus Hougesen, CEO Atea ASA, Mobile +45 3078 1200

Rune Falstad, CFO Atea ASA, Mobile +47 906 14 482

About Atea

Atea is the leading Nordic and Baltic supplier of IT

infrastructure with approximately 4400 employees.

Atea is present in 72 cities in Norway, Sweden,

Denmark, Finland, Lithuania, Latvia and Estonia. Atea

delivers IT products from leading vendors and assist

its customers with specialist competencies within IT

infrastructure services. Atea has an annual revenue

of approximately NOK 15 billion and is listed on Oslo

Stock Exchange. [http://www.atea.com]