Ework Group — Interim / Quarterly Report 2023

Apr 25, 2023

Interim Report January–March 2023

"Our previous assessment for 2023 – in which we expect to continue growing more rapidly than the market and to report a continued improvement to the operating margin – stands firm."

This is Ework Group

Ework provides total talent solutions, with a focus on IT/OT, R&D, Engineering and Business Development and has today more than 13,000 professionals on assignment. We accelerate the growth and development of our clients' operations by matching highly qualified professionals with assignments that are on the front line of technological development and the green transformation. With no in-house professionals, Ework can focus entirely on developing the client relationship and broadening its network of partners and professionals.

Broad client portfolio Strong network Value creation

Ework has many major, strong brands in its client portflio, with a healthy balance between the public and private sectors and a spread across various industries. Together with a comprehensive offering and thorough experience, Ework supports its clients with talent supply and planning.

With one of northern Europe's strongest professional networks of over 100,000 specialists, the client has access to the best talent, while the professionals have the opportunity to work on stimulating assignments, either on site with the client or remotely.

Ework has a unique position as a bridge between clients, partners, and professionals. Our business model helps us create a win-win-win situation over the short and long term for the parties, with increasingly deeper relationships and stronger partnerships throughout the value chain.

High rate of growth, increased order intake, and good margin

Ework Group had a good start to the year, and could report a continued two-figure growth rate of 16 percent. Despite a gradually more cautious market during the quarter, order intake increased 4.3 per cent compared with Q1 2022, which was strongly characterized by pent-up post-pandemic demand. In accordance with plans, we maintained our EBIT margin of 120 base points for the quarter.

From Karin Schreil's CEO statement

Q1 2023 compared with Q1 2022

• • Net sales grew by 16% to SEK 4,567 million (3,924).
• • Operating profit rose 14 percent to SEK 53.7 M (47). The improvement to operating profit
• is attributable to strong growth.
• • Operating margin (EBIT) was 120 bps (120).
• • Profit after financial items increased 15.5 percent to SEK 52 M (45).
• • Order intake grew by 4.3 percent to SEK 5,082 million (4,873).
• • The number of professionals on assignment averaged 13,037 (11,787).
• • Earnings after tax and per share after dilution amounted to SEK 2.36 (2.05), an increase of 15 percent.

LTM to March 31, compared with full-year 2022

• • Net sales rose 4 percent to SEK 16,712 M (16,070).
• • Operating profit increased 3.7 percent to SEK 189.8 M (183.1).
• • Profit after financial items increased 4 percent to SEK 189.8 M (183.1).
• • Earnings after tax and per share after dilution amounted to SEK 8.39 (8.05), an increase of 4.17 percent.

Outlook

• Ework's belief that the Group will grow more rapidly than the market and report continued improvements to its operating margin for 2023 stands firm.

Quarterly order intake

CEO STATEMENT

High rate of growth, increased order intake, and good margins

Ework Group had a good start to the year, and could report a continued two-figure growth rate of 16 percent. Despite a gradually more cautious market during the quarter, order intake increased 4.3 percent compared with Q1 2022, which was strongly characterized by pent-up post-pandemic demand. In accordance with plans, we maintained our EBIT margin of 120 base points for the quarter.

The market situation varied during the quarter. We noted a weaker performance in retail and telecoms, whereas demand remained strong in life science and the auto industry, of which the latter benefited from the strong underlying trend toward electrification. There were also geographic differences, where Poland once again demonstrated strong growth largely thanks to demand in the tech field.

The market remained strong but was somewhat more cautious with demand and number of requests lower than in Q1 2022, when demand was exceptionally strong following the pandemic.

Expanded client base and increased order intake

The increased breadth in our client base contributed to Ework's stability during the quarter. In 2022, we signed a number of strategic framework agreements in the public sector, which supported the higher order intake during the quarter. At the same time, we received renewed confidence from the private sector in the form of a number of signed framework agreements with some of our largest clients in the tech, engineering, and auto industries. In Denmark, our Managed Service Provider product is a key reason behind the expansion of our client base. In total we won a number of new clients during the quarter and our client portfolio expanded.

Our delivery capacity also continued to strengthen, which was gratifying. We can see this in our increased hit rate, which is the proportion of inquiries won in relation to bids submitted. I regard the continued upward trend in our delivery capacity, even in a market environment with somewhat weaker sentiment, as a sign of strength. At the same time, the average professional hourly rates were just over 5 percent higher, quarter-on-quarter.

Strategic targeted initiatives

The financial targets we communicated during the first quarter will be achieved through measures such as the further development of our service portfolio. During the quarter, we made progress in Protective Security Services, meaning various types of security-related services including background checks of professionals and personnel. The interest in these services has increased over the past year, and we now have an exciting pipeline.

To achieve our goals, we will have to strengthen our position in the middle of the value chain as a service provider that is focused on delivering increased value to our partners. Part of this is developing and strengthening our industry focus, which we will do by establishing six industry segments that will enable us to come closer to our clients' challenges in order to provide better support with a talent supply over the short and long term. One example from this quarter is banks, finance and insurance, where we are in the process of appointing a segment director. The needs are similar, and the support we provide to bank clients – for example, skills for digital transformation – can also be provided to other client categories.

We also worked further on our cost efficiency. In these rapidly changing times, an agile and scalable business model is a strength, because – among other things – we can re-allocate resources to the industries and regions with the strongest growth. Our EBIT margin totaled 120 base points (120).

The number of inquiries outside our core markets for remote assignments has doubled since the start of our Remote Sourcing Center in the third quarter of 2022 – from a low level, it is true, but it is the trend that is of interest.

In order to meet the total expected demand, we have set our sights on doubling our professional network this year. At the end of the quarter, we had 106,541 professionals in our network – an increase of 58 percent over the first quarter of 2022. In particular, we want to strengthen our network in selected skills areas – for example, digitization and automation – where we are seeing significant client need.

Outlook

As I look ahead, our focus will be on optimizing our efficiency and ensuring that our costs are adjusted to our business volumes.

All together, we kept to our plan during the quarter. With that, our previous assessment for 2023 – in which we expect to continue growing more rapidly than the market and to report a continued improvement to the operating margin – stands firm.

Stockholm, Sweden, April 25, 2023 Karin Schreil, CEO

Development during the quarter

The Group's performance

kSEK	January– March 2023	January– March 2022	Rolling 4 quarters Apr 2022– Mar 2023	Full-year 2022
Net sales	4,566,579	3,924,061	16,712,471	16,069,954
Operating profit, EBIT	53,694	46,996	189,757	183,059
Profit before tax	51,985	45,000	182,577	175,592
Profit for the period	40,717	35,312	144,593	139,189
Sales growth, %	16.4	24.0	14.2	22
Operating margin EBIT, %	1.2	1.2	1.1	1.1
Equity	299,640	236,421	299,640	260,849
Equity/assets ratio, %	6.4	5.9	6.4	5.4
Quick ratio, %	104.3	104.0	103.6	103.3
Average number of employees	341	297	277	314
Net sales per employee	13,392	13,212	60,443	51,178

Market performance and order intake

Ework continued to display healthy growth during the quarter despite a more cautious market with falling levels of demand, compared to the strong quarter in 2022, primarily in retail and telecoms. Even if the increase in demand slackened toward the end of the quarter, this should be seen in the light of the fact that extremely high levels were noted last year as a result of demand being pent up during the pandemic. The underlying demand remained high.

Despite high comparison figures, order intake increased during the quarter even though the trend turned downward in March. The number of new contracts decreased compared to the year-earlier quarter, while contract extensions increased in number and value, contributing to the total increase in combination with higher prices. The number of inquiries decreased compared to the year-earlier quarter.

All together, Ework's average professional hourly rates for the quarter were just over 5 percent higher than the yearearlier period.

Ework continued to strengthen its capacity to deliver, which is measured using the hit rate, that is, our ability to respond to a request and sign a new consultant assignment.

Net sales and profit

The Group's increase in net sales is attributable to higher invoicing volumes and raised professional fees. The improvement to operating profit is due primarily to the good rate of growth.

The number of professionals on assignment continued to increase, averaging 13,037 (11,787), corresponding to an increase of 10 percent year on year. However, the trend had begun to turn downward at the end of the quarter.

FIRST QUARTER OF 2023

As part of the strategic development to achieve the company's goals, the Group's operations are, from and including 2023, divided into two operating segments based on how group management follows results, yield and cash flow. These segments are Market Units Sweden and Market Units Northern & Central Europe, NCE. The comparison figures have thereby been recalculated. The segments are in turn divided into Market units.

Market Units Sweden

SEK M	Order intake		Net sales		MU Earnings
Quarter	Q1 2023	Q1 2022	Q1 2023	Q1 2022	Q1 2023	Q1 2022
Sweden	3,590	3,579	3,371	2,941	75	61
MU Sweden East	1,685	1,763	1,629	1,425	31	22
MU Sweden West	968	952	927	750	29	25
MU Sweden South	465	386	416	345	9	8
MU Sweden Mid North	471	478	400	421	10	8

Sweden

The breadth of the segment Market Units Sweden, with many industries, was a source of strength during the quarter since a number of stronger industries compensated for industries where performance was somewhat weaker. Demand in retail and telecoms, for example, was lower while remaining strong in industry and the auto industry.

Good cost control enabled an improvement to earnings of 21 percent based on growth of 14 percent.

In the public sector, Ework won new assignments pertaining to Consulting Services in the IT field from clients including Nordic Medtest and Statistics Sweden. The energy companies Kraftringen and Gästrike Vatten chose Ework as the sole supplier in the field of Managed Services.

Sweden East

Continued good growth during the quarter. A large share of clients in retail enabled a lower order intake. The re-allocation of internal resources between clients enabled a high hit rate in inquiries while good cost control entailed a strengthening of the margin.

Clients in energy and the public sector supported this growth in the quarter.

Sweden West

The strong trend from late 2022, with many professionals on assignment, continued into the start of this year. Growth in the market unit amounted to just over 23 percent in the quarter, while earnings increased nearly 17 percent. One contributing factor was the strong performance in Automotive, with electrification as a growth driver, but also the public sector.

Sweden South

Very strong growth in the public sector, and overall good performance for Managed Services in Industry. Increased elements of advisory services promoted both higher sales and improvements to efficiency.

Fewer inquiries from clients in retail were offset by an improved hit rate.

A comprehensive agreement was signed with a well-known industry company pertaining to Protective Security Services, meaning various types of security-related services including background checks of professionals and personnel. There is tremendously significant interest in these services owing to both the prevailing security situation and to increasingly more stringent government requirements.

Sweden Mid North

The market unit signed new framework agreements with several new and existing clients, which created good conditions for growth during the year.

Value-creating measures supported a significant strengthening of the margin during the quarter.

Market Units Northern and Central Europe

SEK M	Order intake		Net sales		MU Earnings
Quarter	Q1 2023	Q1 2022	Q1 2023	Q1 2022	Q1 2023	Q1 2022
Northern and Central Europe	1,492	1,294	1,196	988	29	24
MU Norway	580	656	573	569	17	16
MU Denmark	333	206	259	171	5	3
MU Poland	484	345	253	155	6	3
MU Finland	95	87	110	93	3	2

Northern and Central Europe

Sales in the segment increased 23 percent, while earnings increased just over 16 percent during the quarter. In summary, performance was once again at its strongest in Poland, while it was more cautious in Norway owing to new legislation. Performance for the quarter confirms the positive effects of scaling in most markets.

Several market units noted a more tentative attitude at the end of the quarter.

Norway

Norway demonstrated a good level of growth and improved profitability despite continued hesitancy in the market. Early in the year, the Norwegian Parliament adopted amendments to work environment legislation that entered force on April 1. These laws regulate the forms under which freelancers and professionals can be hired. Uncertainty around the content of the new changes had an impact on the Norwegian market during the quarter.

The content of the amended laws are expected to adversely impact demand in the second quarter and 2023 in conjunction with the market adapting itself to the new conditions. Ework has attractive solutions for Total Talent Management, and remains of the opinion that the amendments will not impact the long-term conditions for Ework to offer its services in Norway.

With the amendments in place, Ework intends to further clarify its offering in the Norwegian market, which remains attractive since there continues to be a significant underlying demand for talent.

The outcome in the quarter was also impacted by clients who, for reasons of corporate strategy, chose to re-allocate resources from Norway to other markets.

Denmark

Sales increased over 50 percent, while earnings improved 75 percent, which is a clear example of the economies of scale in conjunction with rising sales. The foremost cause of the improvement was a strong performance in the manufacturing and pharma industries. Demand for Ework's Managed Services offering was particularly strong, from both new and existing clients.

A growing and increasingly diversified client portfolio promoted increased stability in the Danish operation.

Poland

In Poland, sales increased 58 percent adjusted for currency effects while the order intake rose 36 percent year on year.

The level of activity remained high, particularly in banking and finance as well as the tech field, where Ework has been strongly positioned for some time. Like the majority of markets, Poland was able to demonstrate economies of scale as the result of measures including good cost control.

As in several other markets, a fall in the number of inquiries was noted.

Finland

The level of client activity during the quarter was high, and growth amounted to nearly 13 percent adjusted for currency effects, while earnings improved by nearly 20 percent. The focus on client relationships enabled our successes during the quarter, including Ework signing a framework agreement pertaining to Consulting Services in IT with the logistics company Makahuolto.

There was also a focus on offering add-on services such as PayExpress, which contributed to profitability.

Strategic growth initiatives

Ework is engaged in a number of strategic initiatives to strengthen its strategic position in the middle, between partners and professionals, and as a service provider and partner to a number of companies and government authorities in Sweden and the Nordic region. The initiatives are a part of the ongoing efforts to achieve the financial targets, which were announced early in the year, by 2025.

Service development

A further step was taken in Talent Solutions during the quarter through the launch of a Recruitment Process Outsourcing (RPO) offering. The RPO solution combines our lengthy experience in finding and identifying the right skills and candidate in the market with an efficient assessment and selection process.

Another launch took place in combination with the talent company Lexicon, in which we offer training and further education to our network of partners and professionals. Talent is crucial, and this is why areas with new services will routinely be introduced to the members of our network during 2023 and 2024.

In Managed Services, Ework helps clients lower their costs through better resource planning and increased HR support. Here, Ework can achieve much more, and achieve it faster, to optimize client's costs without adversely impacting their operations, which constitutes significant potential for the future.

Development of the professional network

At the end of the quarter, we had 106,541 (67,624) partners and professionals in out network, corresponding to year-on-year growth of 58 percent. We are seeing significant potential for growth, and the goal is therefore to double the size of our network over the coming year. To achieve this goal, we are planning a number of initiatives during the year to make our network even more attractive.

For example, we are engaged in building up and strengthening our network in new geographies via our Remote Sourcing Center, since an increasing number of companies want to investigate the possibility of near-shoring their operations.

Client value

For even better client value, we are now strengthening our industry focus step by step over the long term, which we will do by establishing six industry segments in order to provide better support with talent supply over the short and long term. During the quarter, we appointed a segment director for banks, finance, and insurance. The needs are similar, and the support we provide to bank clients can also be provided to other clients categories.

Apart from banks, finance, and insurance, we are planning a similar initiative in the following industries: public sector;

manufacturing, the auto industry, and life science; consulting, technology, and telecoms; energy; and retail, logistics, and services.

The increased economic uncertainty prompted a greater need among our clients for cost efficiency improvements. Here, Ework sees significant potential for contributing in the form of optimal professional and skills solutions. For example, Ework strengthened its partnership with clients who are in need of optimizing their supply chain, and resolved needs for niche skills in certain fields.

We also signed the first major contract in Protective Security Services, meaning various types of security-related services including background checks of professionals and personnel. These services were launched late in 2022 and generated immediate interest among our clients.

Market expansion

During the first quarter, we drafted a strategy for expansion into new geographies as we see opportunities to grow both organically and through new establishments by accompanying existing clients out into Europe. Furthermore, the plan is to establish a handful of market units in new geographies up through 2025, from which Ework can serve existing and potential new clients in these markets.

As part of this geographic expansion, Ework is engaged in establishing platforms that will make it legally possible to deliver services to and from the majority of geographies without itself having legal units in the geographies in question. Employer of Record and Agency of Record are examples of these platform solutions that will make it possible to fulfill the legal requirements in the respective jurisdictions.

Scaling

In the first quarter, we implemented a new, strong, and business-driven governing model for developing our digital platform so as to further increase value creation, productivity, and cost efficiency. Decisions were also made to introduce a new and more scalable service delivery model that is built on increased cooperation so as to strengthen our deliveries to clients, partners, and professionals.

Other disclosures

Financial position and cash flow

Cash flow from operating activities for the first quarter totaled SEK 80.9 million (69.0). The increase was due to the improvement in earnings.

Cash flow from financing activities totaled SEK -137.8 M (-46.4), of which amortization of working capital financing represented the majority.

Ework holds a credit of SEK 550 M (550) with accounts receivable as security for the credit at SEB. Furthermore, Ework has a local credit for working capital financing in Poland of SEK 300 M (0). As of March 31, 2023, the company's previous overdraft facility, that has been canceled, totaled SEK 0 M (30). Total unutilized credit at the end of the period amounted to SEK 561 M (410).

Net cash at the end of the quarter totaled SEK -26 M (net debt: 7). The equity/assets ratio at the end of the period was 6.4 percent (5.9).

Workforce

The average number of employees during the quarter was 341 (297). The average number of employees is counted based on the number of full-time employees, excluding employees on parental leave, on work leave and long-term sick leave.

Parent Company

The Parent Company's net sales for the first quarter were SEK 3,363 M (2,937). Profit after financial items was SEK 33.7 M (28.6), and profit after tax was SEK 26.7 M (22.7).

The Parent Company's equity at the end of the quarter was SEK 221 M (187), and its equity/assets ratio was 6.2 percent (5.9).

Significant risks and uncertainties

Ework's material business risks, for the Group and the Parent Company, consist of reduced demand for consulting services, difficulties in attracting and retaining skilled staff, credit risks, and to a lesser extent, currency risks.

Ework's risks are impacted by trends in society and the economy as a whole, as they are by rising interest rate levels and uncertainty around the progress of inflation. These trends could entail a risk of lower demand for professional services. Regulatory decisions and necessary consideration of safety aspects could entail a risk of disruptions to the business, both for Ework's own staff and for professionals on assignment.

For a more detailed review of significant risks and uncertainties, please refer to Ework's Annual Report.

The Group's previous tax dispute has been partially resolved. However, the Group still has a minor provision pertaining to the tax dispute that was mentioned in previous interim reports. This has had a marginally positive impact on earnings.

In Norway, amended work environment legislation concerning freelancers and professionals entered force on April 1, 2023. There is uncertainty on the market in how the supply of skills can best be managed according to the adjusted legislation. This means new opportunities but may have negative effects on Ework's business volumes in the coming period.

The information disclosed in this Interim Report is mandatory for Ework Group AB (publ) to publish pursuant to the EU's Market Abuse Regulation (MAR). This information was submitted for publication at 10:00 a.m. (CEST) on 25 April 2023, through the agency of the CEO. This interim report has not been audited.

SHAREHOLDERS

As of March 31, 2023	No. of shares	Votes & capital
Investment AB Arawak 1)	6,813,691	39.41
Avanza Pension	3,213,269	18.59
Protector Forsikring ASA	1,444,182	8.35
Katarina Salén, private and through company	473,962	2.74
Patrik Salén and family, through company	378,500	2.19
Ålandsbanken Abp (Finland), Swedish branch	377,730	2.19
Karin Schreil through company	252,000	1.46
Verdipapirfondet fondsfinans	240,000	1.39
Handelsbanken Liv Forsakring AB	181,285	1.05
Claes Ruthberg	155,000	0.9
Total	13,529,619	78.27
Others	3,757,656	21.73
Total	17,287,275	100

1 ) Staffan Salén and family 86.2%, Erik Åfors 13.8%.

PER SHARE DATA

kSEK	January– March 2023	January– March 2022	Rolling 4 quarters Apr 2022– Mar 2023	Full-year 2022
Earnings per share before dilution, SEK	2.36	2.05	8.39	8.07
Earnings per share after dilution, SEK	2.36	2.05	8.39	8.05
Equity per share before dilution, SEK	17.3	13.7	17.4	15.1
Equity per share after dilution, SEK	17.3	13.7	17.4	15.1
Cash flow from operating activities per share before dilution, SEK	4.68	4.00	7.09	6.40
Cash flow from operating activities per share after dilution, SEK	4.68	4.00	7.09	6.38
Number of shares outstanding at end of period before dilution (000)	17,287	17,240	17,240	17,240
Number of shares outstanding at end of period after dilution (000)	17,287	17,240	17,240	17,287
Average number of shares outstanding before dilution (000)	17,287	17,240	17,240	17,420
Average number of shares outstanding after dilution (000)	17,287	17,243	17,240	17,287

CONSOLIDATED STATEMENT OF INCOME AND OTHER COMPREHENSIVE INCOME

		January–	January–	Rolling 4 quarters
kSEK	Note	March 2023	March 2022	Apr 2022– Mar 2023	Full-year 2022
Operating income
Net sales	1	4,566,579	3,924,061	16,712,471	16,069,954
Other operating income		0	2	75	78
Total operating income		4,566,579	3,924,064	16,712,546	16,070,031
Operating costs
Cost of professionals on assignment Work performed by the company for its own use and		-4,392,431	-3,779,303	-16,084,016	-15,470,888
capitalized		4,359	3,827	19,354	18,823
Other external costs		-37,364	-26,529	-136,613	-125,777
Personnel costs		-78,123	-66,042	-290,650	-278,569
Depreciation, amortization and impairment of property, plant & equipment and intangible non-current assets		-9,327	-9,022	-30,866	-30,561
Total operating costs		-4,512,885	-3,877,067	-16,522,790	-15,886,972
EBIT		53,694	46,996	189,757	183,059
Profit from financial items
Net financial items		-1,708	-1,996	-7,180	-7,467
Profit after financial items		51,985	45,000	182,577	175,592
Tax		-11,269	-9,688	-37,983	-36,402
Profit for the period		40,717	35,312	144,593	139,189
Other comprehensive income
Items that have been reclassified, or are reclassifiable, to profit or loss
Translation differences on translation of foreign operations for the period		-1,926	2,965	-838	4,053
Value changes during the period for cash flow instruments		0	-628	1,382	—
Value changes during the period for cash flow instruments transferred to profit for the period		0	-145	145	754
Other comprehensive income for the period		-1,926	2,192	689	4,807
Comprehensive income for the period		38,791	37,504	145,282	143,996
Earnings per share
before dilution (SEK)		2.36	2.05	8.39	8.07
after dilution (SEK)		2.36	2.05	8.39	8.05
Number of shares outstanding at end of reporting period:
before dilution (000)		17,287	17,240	17,240	17,240
after dilution (000)		17,287	17,240	17,240	17,287
Average number of outstanding shares:
before dilution (000)		17,287	17,240	17,240	17,420
after dilution (000)		17,287	17,243	17,240	17,287

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

kSEK Note	March 31, 2023	March 31, 2022	December 31, 2022
Assets
Non-current assets
Intangible assets	69,058	62,266	67,827
Property, plant and equipment	10,079	5,614	9,479
Right-of-use assets	36,641	22,617	41,598
Deferred tax asset	5,466	4,235	5,546
Non-current receivables	4,988	866	4,906
Total non-current assets	126,232	95,599	129,356
Current assets
Accounts receivable	4,021,209	3,564,809	4,122,864
Tax assets	0	4,873	0
Other receivables 2	31,867	18,208	24,491
Prepaid expenses and accrued income	244,460	184,058	191,436
Cash and cash equivalents	263,054	172,338	332,007
Total current assets	4,560,590	3,944,286	4,670,798
Total assets	4,686,822	4,039,885	4,800,154
Equity and liabilities
Equity
Share capital	2,247	2,241	2,247
Other paid-up capital	63,877	59,749	63,883
Translation reserve	-7,355	-8,044	- 5,435
Retained earnings including profit for the period	240,871	182,475	200,154
Total equity	299,640	236,421	260,849
Non-current liabilities
Lease liabilities	13,935	9,390	18,036
Total non-current liabilities	13,935	9,390	18,036
Current liabilities
Current interest-bearing liabilities	288,877	170,618	423,726
Lease liabilities	18,921	9,010	19,726
Accounts payable	3,920,953	3,456,461	3,948,002
Tax liabilities	8,914	0	9,777
Other liabilities	36,259	59,624	44,364
Accrued expenses and deferred income	99,323	98,360	75,673
Total current liabilities	4,373,247	3,794,074	4,521,269
Total equity and liabilities	4,686,822	4,039,885	4,800,154

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

kSEK	Share capital	Other paid-up capital	Translation reserve	Risk reserve	Retained earnings including profit for the period	Total equity
Opening equity, January 1, 2022	2,241	59,749	-9,482	-754	147,163	198,917
Comprehensive income for the period
Profit for the period					35,312	35,312
Other comprehensive income for the period			2,965	-773		2,192
Comprehensive income for the period			2,965	-773	35,312	37,504
Transactions with the Group's shareholders
Dividends					0	0
Closing equity, March 31, 2022	2,241	59,749	-6,517	-1,527	182,476	236,421

Opening equity, April 1, 2022	2,241	59,749	-6,517	-1,527	182,476	236,421
Comprehensive income for the period
Profit for the period					103,876	103,876
Other comprehensive income for the period			1,088	1,527		2,615
Comprehensive income for the period			1,088	1,527	103,876	106,491

Transactions with the Group's shareholders

Dividends	6	4,129			-86,198	-82,063
Closing equity, December 31, 2022	2,247	63,877	-5,429	0	200,154	260,849

Opening equity, January 1, 2023	2,247	63,877	-5,429	0	200,154	260,849
Comprehensive income for the period
Profit for the period					40,717	40,717
Other comprehensive income for the period			-1,926	0		-1,926
Comprehensive income for the period			-1,926	0	40,717	38,791
Transactions with the Group's shareholders
Dividends					0	0
Closing equity, March 31, 2023	2,247	63,877	-7,355	0	240,871	299,640

CONSOLIDATED STATEMENT OF CASH FLOWS

kSEK	January– March 2023	January– March 2022	Rolling 4 quarters Apr 2022– Mar 2023	Full-year 2022
Operating activities
Profit after financial items	51,985	45,000	182,577	175,592
Adjustment for non-cash items	9,327	9,022	30,866	30,561
Income tax paid	-13,574	-11,186	-16,964	-14,576
Cash flow from operating activities before changes in working capital	47,738	42,836	196,478	191,577
Cash flow from changes in working capital	34,134	26,192	-73,282	-81,224
Increase (-)/Decrease (+) in operating receivables	24,042	-243,614	-509,275	-776,931
Increase (+)/Decrease (-) in operating liabilities	10,092	269,806	435,993	695,707
Cash flow from operating activities	81,871	69,029	123,196	110,353
Investing activities
Acquisition of property, plant, & equipment	-1,934	-3,244	-8,427	-9,737
Acquisition of intangible assets	-4,358	-3,827	-19,354	-18,823
Cash flow from investing activities	-6,292	-7,071	-27,781	-28,560
Financing activities
Premiums deposited on issuance of share warrants	0	0	0	0
Dividend paid to Parent Company shareholders	0	0	-86,198	-86,198
Amortization/admission of lease liability and borrowings	-139,807	-46,430	104,395	197,771
Realized derivatives	0	0	-9,533	-9,533
Cash flow from financing activities	-139,807	-46,430	8,663	102,040
Cash flow for the period	-64,227	15,528	104,078	183,833
Cash and cash equivalents at beginning of period	332,007	154,495	172,338	154,495
Exchange rate difference	-4,726	2,315	-13,363	-6,321
Cash and cash equivalents at end of period	263,054	172,338	263,053	332,007

PARENT COMPANY INCOME STATEMENT

	January– March	January– March	Rolling 4 quarters Apr 2022–	Full-year
kSEK	2023	2022	Mar 2023	2022
Operating income
Net sales	3,363,267	2,936,655	12,435,461	12,008,849
Work performed by the company for its own use and capitalized	4,359	3,827	19,354	18,823
Other operating income	8,607	8,284	40,071	39,749
Total operating income	3,376,233	2,948,767	12,494,887	12,067,421
Operating costs
Cost of professionals on assignment	-3,250,741	-2,839,799	-12,024,373	-11,613,431
Other external costs	-37,841	-32,933	-143,450	-138,542
Personnel costs	-50,974	-44,386	-195,438	-188,851
Depreciation, amortization and impairment of property, plant & equipment and intangible non-current assets	-4,272	-3,517	-16,039	-15,284
Total operating costs	-3,343,828	-2,920,635	-12,379,301	-11,956,108
EBIT	32,405	28,132	115,586	111,313
Profit from financial items
Dividends from participations in subsidiaries	0	0	21,144	21,144
Other interest income and similar items	4,072	2,667	17,031	15,626
Interest expense and similar items	-2,820	-2,177	-13,535	-12,892
Profit after financial items	33,658	28,621	140,226	135,190
Tax	-6,992	-5,931	-24,854	-23,793
Profit for the period*	26,665	22,690	115,372	111,396

* Profit for the period is consistent with comprehensive income for the period.

PARENT COMPANY BALANCE SHEET

kSEK	March 31, 2023	March 31, 2022	December 31, 2022
Assets
Non-current assets
Intangible assets	69,058	62,266	67,827
Property, plant and equipment	8,555	4,739	8,798
Financial assets
Other non-current receivables	3,750	38	3,750
Participations in Group companies	34,240	34,240	34,240
Total financial assets	37,990	34,278	37,990
Total non-current assets	115,603	101,283	114,616
Current assets
Accounts receivable	3,019,195	2,734,334	3,162,283
Receivables from Group companies	132,984	175,990	133,801
Tax assets	1,547	13,196	1,611
Other receivables	305	0	2
Prepaid expenses and accrued income	188,169	117,017	133,458
Cash and bank balances	83,192	31,895	170,809
Total current assets	3,425,393	3,072,432	3,601,964
Total assets	3,540,996	3,173,715	3,716,580
Equity and liabilities
Equity
Restricted equity
Share capital (17,239,675 shares with par value of SEK 0.13)	2,247	2,241	2,247
Statutory reserve	6,355	6,355	6,355
Development fund	69,137	62,232	67,892
Total restricted equity	77,739	70,828	76,495
Non-restricted equity
Share premium reserve	14,707	9,518	13,645
Retained earnings	101,994	83,707	-8,152
Profit for the period	26,665	22,690	111,396
Total non-restricted equity	143,367	115,915	116,890
Total equity	221,106	186,743	193,384
Current liabilities
Liabilities to credit institutions	178,877	170,618	326,183
Accounts payable	3,042,152	2,683,191	3,096,494
Liabilities to Group companies	0	0	333
Tax liabilities	0	0	0
Other liabilities	24,602	46,550	46,743
Accrued expenses and deferred income	74,259	86,614	53,441
Total current liabilities	3,319,890	2,986,972	3,523,195
Total equity and liabilities	3,540,996	3,173,715	3,716,580

ACCOUNTING POLICIES

The Interim Report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and appropriate provisions of the Swedish Annual Accounts Act. The Interim Report for the Parent Company has been prepared in accor-

Note 1 Operating segments

The Group's operations are divided into operating segments based on the parts of operations monitored by the Company's chief operating decision-maker, known as the management approach.

As a link in strategic development and the associated development of management and organization, as of 2023 the Group monitors the operation based on two segments: Market Units Sweden and Market Units Northern and Central Europe (NCE), respectively. In that connection, the comparison figures have been restated.

Executive management monitors the results of operations, returns and cash flow generated by the different segments of the Group. Each operating segment has a manager who is responsible for operations and who regularly reports the outcome of the operating segment's operation and the need for resources to executive management.

The segments are the same as the operations and conduct sales of Ework's total service offering in their respective geographic markets.

dance with Chapter 9 of the Swedish Annual Accounts Act, on interim financial reporting.

Accounting policies and calculation methods are unchanged from those applied in the annual report for 2022.

In turn, the segments are divided into Market Units. The respective segments have operational responsibility for their income statements, down to the level of the segment's operating profit. Sales and operating profit per Market Unit are presented on a voluntary basis below.

Segment earnings do not include central costs for executive management and Group functions (Finance, HR, Marketing, Strategic Sales, and Legal) and development costs for the digital platform.

The accounting policies that are applied in segment reporting differ from IFRS on one point. Segment earnings include the costs of the financing solutions that Ework offers its clients. These costs are recognized in the Group's profit or loss, according to IFRS, as interest expenses in net financial items.

Internal pricing between the Group's various operating segments is based on the arm's-length principle, i.e. between parties that are mutually independent, well-informed and with an interest in the transactions being executed.

Operating segments 2023	Market Units Sweden	Market Units Northern & Central Europe	Total segments	Central costs	Difference in account ing policies	Eliminations	Total IFRS
External income	3,371	1,196	4,567			—	4,567
Internal income	8.6	12.4	21			-21	—
Segment earnings	75	29	104		4.7
Operating profit, EBIT				-55			54
Net financial items					-4.7		-2
Profit before tax							52
*) Of which depreciation/ amortization	-	-	-
*) of which interest expenses	-1.7	-3.0	-4.7

Market Units 2023	Sales Q1	Segment earnings Q1
Market Unit East	1,629	31
Market Unit Mid North	400	10
Market Unit West	927	29
Market Unit South	416	9
Market Unit Sweden*	3,371	75
Market Unit Denmark	259	5
Market Unit Norway	573	17
Market Unit Finland	110	3
Market Unit Poland	253	6
Market Unit Northern & Central Europe*	1,196	29

Note 2 Financial instruments measured at fair value

	January–March 2023			January–March 2022
	Carrying amount		Fair value	Carrying amount		Fair value
kSEK	Measured at fair value through profit or loss	Measured at fair value via other comprehen sive income	Level 2	Measured at fair value through profit or loss	Measured at fair value via other comprehen sive income	Level 2
Financial liabilities/ assets
Currency derivatives	-	-	-	-1,290	-1,527	-1,290

Fair value is determined on the basis of quoted prices.

Carrying amount of accounts receivable, accrued income, cash and cash equivalents, accounts payable, current interest-bearing liabilities and other liabilities constitute a reasonable approximation of fair value.

DEFINITIONS OF KEY INDICATORS

Ework Group utilizes a number of financial metrics in Interim Reports and Annual Reports that are not defined according to IFRS, known as alternative performance measures, according to ESMA (the European Securities and Markets Authority) guidelines.

A number of metrics and key performance data appearing in interim reports and the annual report are defined below. Most should be considered generally accepted, and of such nature that they could be expected to be presented in interim reports and the annual report to convey a view of the Group's results of operations, profitability and financial position.

Key performance data	Definition of usage
Sales growth	Net sales for the period less net sales for the comparative period in relation to net sales for the comparative period.
Operating margin, EBIT	Operating profit (EBIT) in relation to net sales.
Profit margin	Profit after financial items in relation to net sales.
Return on equity	Profit for the period in relation to average equity in the period. Return on equity is restated at an annualized rate in interim reporting. A profitability metric that illustrates returns on the capital that shareholders invested in operations during the period.
Equity/assets ratio	Reported equity in relation to reported total assets at the end of the period. Metric illustrating interest rate sensitivity and financial stability.
Quick ratio	Current assets in relation to current liabilities.
Earnings per share	Profit for the period in relation to the number of outstanding shares before dilution at the end of the period. Defined in IAS 33.
Equity per share	Equity in relation to the number of shares outstanding before dilution at the end of the period. Metric illustrating shareholders' proportion of total net assets per share.
Segment earnings	The earnings for the segments differs from Operating profit (EBIT) since it does not include central costs for executive management, Group functions and development of the digital plat form. Segment earnings are less interest expenses for financing solutions, which are recognized as net financial items in the consolidated financial statements.

Ework Group AB (publ) provides total talent solutions, with a focus on IT/OT, R&D, Engineering and Business Development and has today around 13,000 independent professionals on assignment. Ework partners with clients in both the private and the public sector, and with professionals to create sustainable talent supply chains. Ework was founded in Sweden in 2000 and operates in Sweden, Denmark, Norway, Finland, and Poland with its head office in Stockholm. Ework's shares are listed on Nasdaq Stockholm.

www.eworkgroup.com

Ework Group AB (publ)

Vasagatan 16 SE-111 20 Stockholm Tel: +46 (0)8 506 05500 Corp. ID No. 556587-8708

Forthcoming financial reports

Annual General Meeting April 25 Interim Report, April–June 2023 July 19 Interim Report, July–September 2023 October 24

Contacts for more information

Karin Schreil, CEO +46 (0)8 50 60 55 00 mobile +46 (0)70 794 5883 Klas Rewelj, CFO +46 (0)8 50 60 55 00 mobile +46 (0)70 626 5424