ECIT AS — Investor Presentation 2021

Aug 31, 2021

First half year 2021

Investor presentation

31. August 2021

Content

• 1. HY1 2021 highlights
• 2. Division segments
• 3. Financial position
• 4. Update on acquisitions
• 5. Shareholder structure
• 6. Appendix

H1 2021 Highlights

• Listing on Euronext Growth in May with cash 378 MNOK in increased capital
• Revenue at MNOK 1,178 with a 32.6% growth hereof 6.1% organic growth
• EBITDA at MNOK 146 (103) with a 12,4% (11.6%) EBITDA margin
• Organic growth in IT (16.1%), a lower growth in F&A (0.9%) due to Covid-19 and a growth in ARR in Tech at 19%
• EBITDA margin in F&A (16.5%) and a lower EBITDA margin in IT (9.2%)
• Free cash flow at MNOK 84 (122). NWC affected by paying back Covid-19 related debt
• Five acquisitions including Norian with a full year revenue at MNOK 377
• Ownership share end August 2021 increase to ~ 63.4% versus ~ 55% by year end 2020

ECIT in brief

Note: (1) NGAAP from 2013-2017, IFRS light 2018-2020 with IFRS16 leases included from 2019.

Revenue EBITDA EBITDA margin

Key financial targets

Metric	Half year 2020	Half year 2021	Mid-to-long term ambitions
Growth	•	Organic: 6.1%	Organic CAGR: ≥ 5.5%
	Organic: 4.9%	•	•
	•	Incl. Acq.: 32.6%	CAGR including acquisitions: ≥ 15%
	Incl. Acq.: 28.7%	•	•
Recurring	•	•	Recurring revenue: → 60%
revenue	N/A	N/A	•
EBITDA margin	EBITDA margin: 11.6%	•	•
	•	EBITDA margin: 12.4%	EBITDA margin: →17%
NIBD/EBITDA	•	•	•
	NIBD/EBITDA: 0.0x	NIBD/EBITDA: -0.1x	NIBD/EBITDA: < 1.5x
M&A	Revenue acquired • half year: NOK 216m	Revenue acquired • half year: NOK 377m	Average revenue acquired per year: ~ NOK 350m •

Financial H1 2021 highlights

			624
		445
		2020 Q2	2021 Q2
Selected financial information			40,2%

EBITDA (NOKm) and margin (%)

Free cash flow (NOKm)

2020 H1 2021 H1

32,6%

889

1.178

EBITDA*	53,7%	46,3%
31 August 2021
Revenue	66,0%	34,0%
EBITDA*	60,9%	39,1%

Revenue (NOKm) Management comments

• H1 Growth at 32,6%, incl. organic growth at 6,1% adjusted for currency.
• EBITDA H1 margin 12,4% from 11,6%.
• Five acquisitions completed including the Norian Group, the largest acquisition so far.
• Acquired revenue NOK 377m
• Investment NOK 256m NOK 240m cash and NOK 16m ECIT shares.
• Free cash flow NOK 84 million (122). NWC affected by paying back VAT, Tax and other duties with prolonged payment due to Covid-19.
• Right after listing ECIT started to increase the average ownership share in subsidiaries through purchase of minority shares (partly exercising the options to acquire subsidiary minority shares).
• By end August 2021 ECIT owns appr. 66% (61.1%) of revenue and 61% (53.7%) of EBITDA (average of the two 63,4%). Paid NOK 56m in cash and NOK 11m in ECIT shares (paid after 30 June 2021).

*) Before special items

**) Free cash flow before special items, IFRS16 leases, R&D and acquisitions

IT division

Financial overview (NOKm)

(NOKm)	Q2 2021	Q2 2020	Total Growth	H1 2021	H1 2020	Organic Growth	Total Growth
Revenue	267	206	29,6%	533	404	16,1%	31,9%
Gross Profit	162	128	26,6%	319	249	14,3%	27,9%
EBITDA*	28	24	18,1%	49	40	19,1%	21,7%
Gross margin	60,5%	61,9%	-1,5 p.p.	59,8%	61,6%		-1,8 p.p.
EBITDA margin*	10,5%	11,5%	-1,0 p.p.	9,2%	10,0%		-0,8 p.p.

EBITDA (NOKm) and margin (%)

Revenue (NOKm)

• Revenue at NOK 533m (NOK 404m).
• 16,1% organic growth and 31,9% growth incl. acquisitions.
• EBITDA at NOK 49m (NOK 40m).
• 9,2% (10,0%) EBITDA margin slightly affected by Covid-19 H1where as the activity is gradually picking up.
• High demands from existing, new and potential customers based on a positive market development.
• On going consolidation in the Nordic IT market continues which brings ECIT in position to win new midmarket and lower enterprise customers.
• The IT market is still very fragmented, with many potential acquisition targets.

F&A division

Financial overview (NOKm)

(NOKm)	Q2 2021	Q2 2020	Total Growth	H1 2021	H1 2020	Organic Growth	Total Growth
Revenue	369	250	47,4%	669	500	0,9%	33,7%
Gross Profit	339	232	45,9%	619	468	0,1%	32,1%
EBITDA	59	41	45,3%	110	78	5,8%	41,2%
Gross margin	92,0%	92,9%	-1,0 p.p.	92,5%	93,6%		-1,1 p.p.
EBITDA margin	16,1%	16,3%	-0,2 p.p.	16,5%	15,6%		0,9 p.p.

EBITDA (NOKm) and margin (%)

Revenue (NOKm)

• Revenue at NOK 669m (NOK 500m).
• 0,9% organic growth and 33.7% growth incl. acquisitions.
• EBITDA at NOK 110m (NOK 78m).
• 16,5% (15,6%) EBITDA margin.
• Revenue is clearly affected by Covid-19 decrease in customer activity. However activity is gradually picking up.
• The EBITDA margin improvement is a result of the long term efforts to automate, to improve processes and to consolidate ECIT.
• The F&A market is very fragmented, with many potential acquisition targets.
• The Norian acquisition has improved competence within automation, process management and large customer experience which has strengthened the F&A division.

Tech division

Financial overview (NOKm)

(NOKm)	Q2 2021	Q2 2020	Total Growth	H1 2021	H1 2020	Organic Growth	Total Growth
Revenue	23	15	47,8%	45	30	14,9%	47,8%
Gross Profit	18	12	50,6%	36	24	12,9%	48,5%
EBITDA	- 4	0	0,0%	- 6	- 2
Gross margin	79,2%	77,8%	1,5 p.p.	80,1%	79,7%		0,4 p.p.
EBITDA margin	-18,2%	1,0%	-19,1 p.p.	-14,0%	-5,6%		-8,4 p.p.

Recurring Revenue

KPI figures

Revenue (NOKm)

Financial position

Cash flow summarized

Cash Flow Statement (NOKm)	H1 2021	H1 2020
Operating activities Investing activities Financing activities	126 -229 253	160 -62 -2
Cash flow for the period	151	96
Free cash flow	84	122

Free Cash Flow

Specification of free cash flow	H1	H1
(NOKm)	2021	2020
Cash flow from operating (A)	126	160
Special items	8	0
Net investments in tangible assets	-10	-11
Repayment of lease liabilities	-41	-27
Free cash flow	84	122

Net interest bearing debt development

Development in NIBD (NOKm)	30 JUN 2021	30 JUN 2020
Loans and credit facilities	178	96
Lease liabilities	241	188
Other interest bearing liabilities	0	2
Total financial liabilities	419	286
Other interest bearing receivables	72	46
Cash and cash equivalents	393	248
Total financial assets	464	294
Net debt / Net cash (-)	-45	-8
EBITDA, LTM (before special items)	319	252
Debt leverage	-0,1	0,0

Credit facility overview

Credit facilities (NOKm)	30 JUN 2021	30 JUN 2020
Credit facility gross Credit facility utilized	475 -123	270 -76
Net credit facility availiable	352	194

• The financial position in ECIT is solid enabling further growth.
• Total available cash (NOK 393 million) and credit facility (NOK 352 million) totaling ~ NOK 750 million.
• Investing activities affected by the acquisition of Norian (higher cash share than usual).
• Financing activities impacted by the capital increase from the IPO.
• Free cash flow seems lower than last year which is explained by Covid19 impact on the NWC. Adjusted for postponed governmental payments, free cash flow is better than last year.
• Negative NIBD of NOK 45 million (net cash) and a leverage ratio of -0,1x.
• Option "debt" related to minority shares represent approx. NOK 550m as of 30 June 2021(FY 2020: NOK 530m). Not calculated into NIBD.

Update on acquisitions

Acquired companies per June 2021

Acquired companies during the year			Acquistion
(NOKm)	Country	Division	Month	Revenue	FTE
Fully consolidated subsidiaries
ASK Outsourcing AB	Sweden	F&A	February	10	8
Aktiv Kontroll AS	Norway	F&A	March	7	10
Norian Group	International	F&A	April	265	550
PC-System Senteret AS	Norway	I T	June	18	16
Sum				300	584
Recognized as associated company
Value Group	Norway	F&A	June	77	83
Total				377	667

Acquired revenue (NOKm)

• ECIT continues with a reasonable M&A pace completing 5 acquisition for the first six month representing acquired revenue of NOK 377 million.
• Total investment represent NOK 256 million hereof cash payment at NOK 240 million and share payment at NOK 16 million,
• ECIT has a substantial M&A pipeline (+3bn in revenue) with targets identified within all business areas.
• Integration of acquired companies continues according to plan.
• Compared to last year (pro forma) Norian has delivered reasonable revenue growth and a doubled EBITDA margin.

Shareholder structure

Shareholder overview (top 20)*

		Owner	Voting
Shareholders Top 20	Total shares	ship	share
CGL Holding II AS & CGL Holding II AS (Peter Lauring)**	42.336.068	9,57%	49,9%
Varner Kapital AS	25.000.000	5,65%	3,1%
Paradigm Capital Management, Inc.	25.000.000	5,65%	3,1%
IC Services 2 AS	24.422.535	5,52%	3,0%
Mikkel Walde Holding ApS	15.524.827	3,51%	1,9%
Y-Not ApS	14.840.253	3,35%	1,8%
MP Pensjon PK	10.622.154	2,40%	1,3%
Bras Kapital AS	9.363.138	2,12%	1,1%
Veiby Invest AS	6.566.389	1,48%	0,8%
Anglo Supply AS ***	6.485.604	1,47%	0,8%
Fidelity Management & Research Co. LLC	6.250.000	1,41%	0,8%
Arctic Securities AS	5.606.519	1,27%	0,7%
Deka Investment GmbH	5.600.000	1,27%	0,7%
Loe Equity AS	4.713.545	1,07%	0,6%
Infolink Holding AS	4.503.248	1,02%	0,6%
Litu AS	4.178.388	0,94%	0,5%
Pa Kompetens Lön Sverige AB	3.912.895	0,88%	0,5%
P H Mathiesen Holding Af 2018 ApS	3.821.965	0,86%	0,5%
Job Gruppen AS	3.577.598	0,81%	0,4%
Y ApS	3.564.711	0,81%	0,4%
Total	225.889.837	51,06%	72,4%
Other shareholders	216.471.916	48,94%	27,6%
Total number of shares	442.361.753	100,00%	100,0%

Shareholders – per investor type

76%

B-shares

Management comments

• ECIT AS is owned through a multiple share class structure where Peter Lauring, the CEO and Founder, is the largest owner holding 9,57% of the economic interest and 49,9% of the voting rights through CGL Holding AS and CGL Holding II AS
• Management, employees and partners holding in total 58,1% of the shares in ECIT AS are highly aligned with the interest of the company
• All shareholders prior listing are subject to lock up for a period of 6 to 36 months depending on individual agreements

Share classes

• A-shares:

Not subject to listing. Carry 10 votes per share and are all owned by Peter Lauring. A-shares are to be converted to Bshares when Mr. Lauring is no longer a part of ECIT, or in case of a sale to a third party or listing of the A-shares

• B-shares:

Carry one vote per share. Listed on Euronext Growth Oslo.

• C-shares:

Not subject to listing. Carry one vote per share. Established to accommodate for Danish shareholders owning ECIT shares through a holding company.

*) Excluding 3.903.078 treasury shares **) CGL Holding II AS: 36,484,940 shares, CGL Holding AS: 4,951,128 shares, Peter Lauring: 900,000 shares. Adjusted for Peter Lauring's maximum voting right of 49.9% according to ECIT's articles of association ***) With reference to section 6 event after the reporting period in the Interim Half year Report, the 5,606,519 shares were purchased as part of the stabilization program following the listing.

Q&A

Appendix

P&L H1 2021

Condensed Income Statement (NOKm)	Q2	Q2	H1	H1
	2021	2020	2021	2020
Revenue	624	445	1.178	889
Direct costs	-130	-92	-261	-203
Gross Profit	494	354	918	686
Other external expenses	-45	-31	-77	-49
Staff costs	-370	-265	-695	-534
EBITDA before special items	80	57	146	103
Special items, net	-8	0	-8	0
EBITDA after special items	71	57	137	103
Amortizations and depreciations	-42	-30	-76	-58
EBIT	30	27	61	45
Financial items, net	-7	0	-10	-2
Profit before tax	23	27	51	44
Tax on profit for the period	-5	-7	-12	-11
Profit for the period	17	20	39	32
Earnings per share: Earnings per share (NOK) Diluted earnings per share (NOK)			0,04 0,04	0,03 0,03

• Growth in revenue are positive impacted by combined organic - and acquisition growth. The currency impact has had an negative effect on the total growth (minus 5%)
• 'Staff cost' in percentage of revenue represent 59.0% for H1 2021 versus 60.1% last year. The development in staff cost is in line with expectations.
• 'Special item' cost represent NOK 8 million and is mainly related to M&A transactions cost.
• 'Amortizations and depreciations' have increased mainly due to acquisitions, whereas amortizations coming from customer relationship and depreciations from capitalized IFRS16 leasing are the two largest contributors.
• 'Financial items, net' have increased which is explained by the IPO cost and exchange rate adjustments (mainly fluctuations in Danish and Swedish kroners).

Balance Sheet H1 2021

Balance sheet - Assets (NOKm)	30 Jun 2021	30 Jun 2020	31 Dec 2020	Balance sheet - Liabilities (NOKm)	30 Jun 2021	30 Jun 2020	31 Dec 2020
Goodwill	918	685	728	Share capital	442	385	388
Customer contracts	317	251	276	Treasury shares	-4	-4	-8
Research & development	85	75	82	Reserves and retained earnings	771	458	431
Deferred tax assets	26	23	15	ECIT AS shareholders share of Equity	1.209	839	811
Intangible assets	1.345	1.034	1.101
				Non-controlling interest	192	197	161
Land, buildings and equipment	61	70	70	Total equity	1.401	1.036	972
Right-of-use assets	234	182	194	Lease liabilities	169	136	139
Tangible assets	296	252	264	Borrowings (interest bearing)	144	95	117
Other financial assets	60	47	17	Provisions	29	34	47
Other receivables, interest bearing	51	37	56	Other non-current liabilities	10	6	0
Other receivables	6	4	2	Deferred tax liabilities	70	51	60
Total non-current assets	1.757	1.374	1.440	Total non-current liabilities	423	322	363
Inventories	12	8	11	Lease liabilities	72	52	62
Trade receivables	288	221	288	Borrowings (interest bearing)	34	1	21
Other receivables, interest bearing	21	9	21	Provisions	8	19	32
Other receivables	130	78	101	Tax payables	34	32	38
Cash and cash equivalents	393	248	246	Trade payables	87	70	98
Total current assets	845	563	667	Deferred income	41	37	35
				Dividend	69	10	134
Total assets	2.602	1.937	2.107	Other current liabilites	433	358	352
				Total current liabilities	777	578	772
				Equity and liabilities	2.602	1.937	2.107

• Goodwill and customer relationships represent NOK 1,235 million per June 2021 and close to 50% of the total assets.
• The increase in both goodwill and customer relationship to previous periods can be explained by acquisitions, whereas the Norian Group acquisition in April 2021 represent a significant increase compared to previous periods.
• The increase in ECIT AS shareholders share of Equity can mainly be explained by the capital increase in connection with the listing of ECIT AS.
• Non-controlling interest represent the value of minorities share of net assets and customer relationship.
• Earn out liabilities are classified as "Provisions" in the balance sheet (holds a short- and long term part).
• The ordinary annual dividend for 2020 representing NOK 65 million is paid out to the shareholders August 31st 2021.

Statement of changes in Equity

Equity Statement (NOKm)	Share Capital	Not reg. Capital increase	Share premium	Treasury shares	Retained earnings	Sharehold ers share of equity	Non controlling interests	Total equity
Equity at 1 January	388	4	371	-8	55	811	161	972
Profit for the year	0	0	0	0	16	16	23	39
Net exchange differences recognized in OCI	0	0	0	0	-5	-5	2	-3
Other comprehensive income	0	0	0	0	-5	-5	2	-3
Total comprehensive income	0	0	0	0	11	11	26	37
Transactions with shareholders:
Capital increase	54	1	351	0	0	406	0	406
Dividends distributed	0	0	0	0	0	0	-1	-1
Sale and purchase of treasury shares	0	0	0	4	18	22	0	22
Addition of non-controlling interests, customer contracts	0	0	0	0	0	0	10	10
Addition of non-controlling interests, net assets	0	0	0	0	0	0	8	8
Acqusition and disposal of shares from/to non-controlling interests	0	0	0	0	-18	-18	-12	-30
IPO Transaction costs	0	0	-24	0	0	-24	0	-24
Total transactions with owners	54	1	327	4	0	387	6	392
Equity end of period	442	5	698	-4	67	1.209	192	1.401

• The increase in 'capital share' is mainly related to the IPO of ECIT AS.
• 'Dividends distributed' is dividend paid to minority shareholders.
• Movements in 'Sale and purchase of treasury shares' are mainly related to treasury shares used for payment of acquisitions.
• 'Addition of non-controlling interests, customer contracts and net assets' are increasing when ECIT acquire companies.
• 'Acquisition and disposal of shares from/to noncontrolling interests' are related to mainly transactions with minority shareholders when utilizing option agreements.
• The IPO transaction costs recognized in equity are related to the capital increase.

The Nordic F&A and IT markets display several attractive characteristics

Delivering management and public reports within F&A and Payroll

	Business areas
		Finance & Accounting		Payroll & HR
	Record history	Analysis & forward	Payroll	HR
	• Data register / process driven Public reporting / reports • • Fixed outcome • Deadlines • Compliance	• Data drilling / knowledge driven Management reporting • • Tailor made • Ad hoc & Regular • Decision analysis • Forward looking	Data register / process • driven • Timely • Correct Complete • Public reporting / reports • Compliance •	• "People mgmt." • Mgmt reports • Know ledge driven • Ad hoc & Regular Compliance •
Value add	Necessary	Decision support	Necessary	Decision support
Automation	Higher	Lower	Higher	Lower
Price per hour	Lower	Higher	Lower	Higher
Revenue from hour based to fixed & transaction based, as activities are automated

ECIT provides end-to-end coverage for IT outsourcing, simplifying IT operations and outsourcing for customers

ECIT is an attractive platform for entrepreneurs looking to grow and develop their business

ECIT has developed an industrialised process for acquiring and integrating companies creating multi-competence centre

Minorities and ownership strategy

ECIT option strategy

ECIT has the option to partly or completely acquire the remaining shares in partly owned companies at a fixed price