Elliptic Laboratories ASA — Earnings Release 2020

Nov 16, 2020

Elliptic Laboratories AS: Third quarter results 2020

Elliptic Laboratories AS: Third quarter results 2020

Oslo, Norway – November 16, 2020. Our third quarter showed Elliptic Labs business performing strongly in securing new agreements, especially in light of the global Covid-19 pandemic and its continuing end market and macro-economic impact. Smartphone demand is becoming highly resilient with larger contracts, new customers and longer commitments, while our laptop market is showing significant opportunities. As this momentum continues we expect robust growth in the fourth quarter based on meaningful ramp ups in the consumer market.

Operating revenue for the third quarter totaled NOK 7.1 million (NOK 12.7 million), year to date NOK 17.5 million (NOK 34.1 million). Operating costs totaled NOK 14.7 million (NOK 15.4 million), year to date NOK 44.8 million (NOK 47.9 million). The largest portion of operating costs were personnel expenses which accounted for NOK 9.4 million (NOK 11.3 million), year to date NOK 30.6 million (NOK 33.0 million). The operating loss for the quarter was NOK 7.6 million (NOK 2.7 million), year to date NOK 27.3 million (NOK 13.8 million).

The loss before tax was NOK 8.3 million (NOK 3.8 million), year to date NOK 29.7 million (NOK 16.3 million).

The cash flow from operating activities was NOK –2.6 million (NOK –1.8 million), year to date NOK –19.7 million (NOK –6.4 million).

Despite the lower financial figures for the first three quarters of 2020 compared to 2019, Elliptic Labs expects to deliver a financial year 2020 with a top-line not far from the previous year in line with expectations set in connection with the listing at OSE Merkur Markets in October 2020.

After having raised NOK 125m in new equity capital in October 2020, Elliptic Labs has paid down interest bearing debt with NOK 25m and stands in a very solid position for fueling future growth.

Highlights from the third quarter:

- Secured a USD 3 million license contract with a smartphone manufacturer, not recognized as revenue this quarter

- Signed contract with a new smartphone customer

- Volume-based revenue from previously launched smartphones

- Launched with smartphone customer Xiaomi; Mi 10T Lite Smartphone

- Landed two new Proof-of-Concept agreements in the laptop market, one with a top-three global laptop manufacturer

- Extended partnership with Infineon to deliver new capabilities for IoT, Consumer Electronics, and Automotive Markets

“The demand for our Virtual Smart Sensor Platform increases in several verticals. We see existing and new customers in the SmartPhone and Laptop industries eager to enter into broader deployments and longer term commitments for our software solutions. This will accelerate our software adoption and broaden our revenue base for 2021 and onwards. The Covid-19 pandemic, after having been challenging for us in the first half of 2020, now further fuels an already strong digitalization trend.”, says CEO Laila Danielsen in Elliptic Labs.

For further information, please contact:

Thor A. Talhaug, CFO Elliptic Laboratories AS

Phone: +47 97 59 99 98

About Elliptic Labs:

Elliptic Labs is headquartered in Norway with presence in the USA, China, South Korea, and Japan. Founded in 2006 as a research spin-off from Norway’s Oslo University, it is now a global enterprise targeting the smartphone, laptop, IoT, and automotive markets. The Company’s patented AI software combines ultrasound and sensor-fusion algorithms to deliver intuitive 3D gesture, proximity and presence sensing experiences. Its scalable AI Virtual Smart Sensor Platform creates software-only sensors that are sustainable, eco-friendly, and already deployed in over 100 million devices. Elliptic Labs is the only software company in the market that has delivered detection capabilities using AI software, ultrasound and sensor-fusion deployed at scale. Elliptic Labs’ technology and IP are developed in Norway and solely owned by the Company.

For more information visit: www.ellipticlabs.com