Elmera Group ASA

Registration Form • Feb 28, 2018

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Fjordkraft intends to apply for a listing on the Oslo Stock Exchange

Bergen, 28 February 2018: Fjordkraft Holding ASA ("Fjordkraft" or the "Company") today announces its intention to launch an initial public offering (the "IPO") of its ordinary shares and to apply for a listing on the Oslo Stock Exchange.

Fjordkraft is the number one brand for electricity retailing in the Norwegian consumer market and the number two brand in the business market¹ . The Company supplies electricity to an estimated more than 1.2 million people through ca. 530,000 delivery points in households, businesses and public entities across Norway. Fjordkraft's vision is to supply electricity to more than two million people and to be Norway's most attractive electricity retailer for its customers, employees and shareholders.

Fjordkraft has delivered strong growth in net revenue² from NOK 336 million in 2012 to NOK 924 million in 2017, with EBIT increasing in the same period from NOK 31 million to NOK 384 million (excluding a loss of NOK 30 million relating to the launch and build-up of mobile services in 2017). This significant increase has been realised through continuous investment in brand building, technical infrastructure and sales resources. This has contributed to increased brand awareness and solid growth of its customer base which is also a reflection of the Company's successful operational excellence efforts. The Company's Consumer and Business segments represented a combined 97% of net revenue in 2017, with New Growth Initiatives comprising the remaining 3%.

Investment highlights

• Operating in the attractive Norwegian electricity retail market, with a non-discretionary and non-cyclical demand profile and with stable and moderate underlying growth
• The Norwegian electricity retail industry was deregulated more than 20 years ago and is highly developed and competitive, benefitting Fjordkraft which has sufficient scale to handle a tough competitive environment effectively – evidenced also by its solid growth and increase in market share over recent years
• A well proven business model, providing a combination of need-to-have electricity and attractive value added services that enable differentiation and support a robust business with ability to realise attractive profitability
• The leading electricity retail brand in the Norwegian consumer market and a clear number two in the business segment
• An unmatched distribution platform for the sale of electricity, including more than 200 sales professionals, ca. 750 external real estate brokers and a wide group of external sale- and benefit programme partners adding to Fjordkraft's sales reach
• A strong position for continued growth and gain in market share based on its leading brand and distribution capabilities, its large consumer and business customer base and scale that enables cost efficient operations and adds to the robustness of its leading position
• Ambition to take lead in the expected consolidation of a fragmented Norwegian electricity retail market, with regulatory developments adding to the push towards consolidation
• A highly experienced management team with an average experience of more than 15 years and a combined experience of more than 135 years

¹ Market positions based on TNS Kantor's Q4 2017 survey for the consumer market and its December 2017 survey for the business market

² Financials for 2015-17 adjusted for estimate deviations and unallocated items, as further detailed in the Company's financial accounts

• A robust asset-light business model with limited capital expenditure requirements, stable underlying demand and limited exposure to changes in electricity system prices
• Solid cash generation supporting attractive and increasing dividend, based on a policy of paying out more than 80% of adjusted net income

Fjordkraft has a market share of around 17% in the consumer market and a brand awareness of around 95% among Norwegian consumers. From the beginning of 2015 until the end of 2017, Fjordkraft increased its market share in the consumer market with close to 5%, significantly outgrowing its closest national competitors. In the business market, the Company's market share is around 13% and the brand awareness is at the same level as in the consumer market. Fjordkraft has identified significant potential for growing its market share within both these segments.

The Consumer segment comprises Fjordkraft's offering to households across Norway. In addition to the sale of electricity with a variety of price plans, Fjordkraft offers a wide selection of value added and adjacent services including loyalty agreements, affinity insurance and payment solutions to its retail customers. The combination of attractive pricing plans, value added services and access to external partner benefits for electricity customers supports Fjordkraft's ability to differentiate the its offering towards consumers. The Consumer segment represented some 71% of the Company's net revenue in 2017.

The Business segment comprises Fjordkraft's offering to small and medium sized businesses, larger corporations and public entities (including municipalities) across Norway. In addition to tailored pricing plans to address individual customer risk profiles, Fjordkraft's business customers have access to value added services including analytical tools, advisory services and other solutions supporting improved monitoring and control of electricity consumption. The Business segment represented some 26% of net revenue in 2017.

In addition to the offering in the Consumer and Business segments, Fjordkraft aims to develop new services to leverage its strong brand, large customer base, distribution power and scale. Such initiatives are reported under New Growth Initiatives ("NGI"). NGI currently comprises Fjordkraft's alliance concept, providing electricity purchasing and other operational support services to smaller local electricity retailers and producers, and a mobile service offering launched in 2017. At year-end 2017, Fjordkraft had 32 alliance partners and over 38,000 mobile customers. NGI represented some 3% of net revenue in 2017.

Rolf Barmen, CEO of Fjordkraft, commented:

"We are proud of the position that we have developed for Fjordkraft over the recent years. We have established ourselves as the leading brand within electricity retailing in the consumer market and as a strong number two in the business segment in Norway. Our entire organisation has a clear ambition to continue delivering profitable growth based on our strong market position, large customer base and scale benefits. We also have a clear ambition to take active lead in consolidating the Norwegian electricity retail market. We therefore look forward to further developing Fjordkraft as an Oslo Stock Exchange listed company, and to invite new shareholders to take part in our vision of having more than two million endcustomers and of being Norway's most attractive electricity retailer."

Robert Olsen, Chairman Fjordkraft, commented:

"The board of directors is impressed by the efforts made by Fjordkraft's employees and management in delivering on the company's strategy and targets. These efforts have resulted in a very favourable development in Fjordkraft's market position, brand awareness and results over recent years. Fjordkraft's board of directors and owners have a strong belief in the company's potential going forward. We therefore look forward to inviting new shareholders to participate in the company's future development through the contemplated offering of shares and listing on the Oslo Stock Exchange."

Financial Highlights

	NGAAP	NGAAP	IFRS	IFRS
NOKm	2015	2016	2016	2017
Gross revenue	3,794	4,753	3,925	4,453
Net revenue (adj.)	724	773	767	924
EBIT (adj.)	304	290	325	354
Consumer	233	196	299	265
Business	64	93	93	119
New growth Initiatives	7	1	3	-30
% Margin (adj.)	42.0%	37.5%	42.4%	38.3%

Fjordkraft has recently entered into an agreement to acquire TrønderEnergi Marked AS ("TEM"), a wholly owned subsidiary of municipality owned and integrated utility group, Trønderenergi AS. TEM is a leading electricity retailer in the Trøndelag area with 61,700 electricity deliveries, of which 50,600 are in the consumer market and 11,100 in the business market. TEM is the number nine electricity retailer in the consumer market in Norway with a market share of c. 2%. Through the acquisition of TEM, Fjordkraft reinforces its position as a consolidator in the Norwegian electricity market and strengthens its presence in Mid-Norway. TEM generated net revenues of NOK 84 million and an EBIT of NOK 36 million in 2017 (both NGAAP figures). Completion of the acquisition is expected in April 2018 and is subject to, among other things, regulatory- and competition authority clearances. TEM is not included in the market share and financial figures presented herein. PwC and ABG Sundal Collier ASA acted as advisor to Fjordkraft in the transaction.

Offering highlights

The IPO and listing of the Company's shares on the Oslo Stock Exchange will support Fjordkraft's strategy and growth plans, contribute to establishing a strong and diverse shareholder base for the Company and enhance Fjordkraft's profile in its Norwegian home market. Furthermore, Fjordkraft expects a stock exchange listing to enhance its ability to take lead in the expected consolidation of the fragmented electricity retail market in Norway.

The IPO will comprise an offering of existing shares sold by the Company's current shareholders BKK AS (currently holding 48.85%), Skagerak Energi AS (48.00%) and Statkraft Industrial Holding AS (3.15%). The offering will comprise a public offering to institutional and retail investors and to eligible employees in the Fjordkraft group, and a private placement to certain institutional investors internationally. Electricity retailing is a strategic part of BKK's and Skagerak Energi's businesses and these two companies therefore intend to continue as significant shareholders of the Company following the IPO.

ABG Sundal Collier ASA ("ABGSC") is acting as Sole Global Coordinator and Joint Bookrunner in the IPO. SpareBank 1 Markets AS is acting as Joint Bookrunner (together with ABGSC, the "Joint Bookrunners"). Advokatfirmaet Schjødt AS is acting as legal advisor to the Company. Advokatfirmaet Wiersholm AS is acting as legal advisor to the Joint Bookrunners.

Further announcements relating to the IPO will be made in due course.

Enquiries Rolf Barmen, CEO +47 900 80 950 rolf.barmen@fjordkraft.no

Important Notice

The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy, fairness or completeness.

None of the Joint Bookrunners or any of their respective affiliates or any of their respective directors, officers, employees, advisors or agents accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available, or for any loss howsoever arising from any use of this announcement or its contents or otherwise arising in connection therewith. This announcement has been prepared by and is the sole responsibility of the Company.

Neither this announcement nor the information contained herein is for publication, distribution or release, in whole or in part, directly or indirectly, in or into or from the United States (including its territories and possessions, any State of the United States and the District of Columbia), Australia, Canada, Japan, Hong Kong, South Africa or any other jurisdiction where to do so would constitute a violation of the relevant laws of such jurisdiction. The publication, distribution or release of this announcement may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This announcement does not contain or constitute an offer to sell or a solicitation of any offer to buy or subscribe for any securities referred to in this announcement to any person in any jurisdiction, including the United States, Australia, Canada, Japan, Hong Kong or South Africa or any jurisdiction to whom or in which such offer or solicitation is unlawful. The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered or sold in the United States absent registration or an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and in accordance with applicable U.S. state securities laws. The Company does not intend to register any securities referred to herein in the United States or to conduct a public offering of securities in the United States.

Any offering of the securities referred to in this announcement will be made by means of a prospectus. This announcement is an advertisement and is not a prospectus for the purposes of Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the "Prospectus Directive"). Investors should not subscribe for any securities referred to in this announcement except on the basis of information contained in the aforementioned prospectus. Copies of any such prospectus will, following publication, be available from the Company's registered office and, subject to certain exceptions, on the website of the Company.

In any EEA Member State other than Norway that has implemented the Prospectus Directive, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive ("Qualified Investors"), i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.

This communication is only being distributed to and is only directed at persons in the United Kingdom that are Qualified Investors and that are (i) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or (ii) high net worth entities, and other persons to whom this announcement may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons. Persons distributing this communication must satisfy themselves that it is lawful to do so.

The Joint Bookrunners and their affiliates are acting exclusively for the Company and the selling shareholders and no-one else in connection with the intended IPO. They will not regard any other person as their respective clients in relation to the intended IPO and will not be responsible to anyone other than the Company and the selling shareholders for providing the protections afforded to their respective clients, nor for providing advice in relation to the intended IPO, the contents of this announcement or any transaction, arrangement or other matter referred to herein.

In connection with the contemplated IPO, the Joint Bookrunners and any of their affiliates, acting as investors for their own accounts, may subscribe for or purchase shares and in that capacity may retain, purchase, sell, offer to sell or otherwise deal for their own accounts in such shares and other securities of the Company or related investments in connection with the contemplated IPO or otherwise. Accordingly, references in any prospectus, if published, to the shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, such Joint Bookrunners and any of their affiliates acting as investors for their own accounts. The Joint Bookrunners do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "aims", "expect", "anticipate", "intends", "estimate", "will", "may", "continue", "should" and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict and are beyond its control. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. The Company, each of the Joint Bookrunners and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement whether as a result of new information, future developments or otherwise.

The IPO may be influenced by a range of circumstances, such as market conditions, and there is no guarantee that the IPO will proceed and that the listing will occur.

Certain figures contained in this document, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances, the sum or percentage change of the numbers contained in this document may not conform exactly with the total figure given.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice.