Keyware Technologies NV — Earnings Release 2014

Nov 14, 2014

PRESS RELEASE 13 November 2014

Keyware records an excellent third quarter

Brussels, Belgium – 13 November 2014 – Keyware (EURONEXT Brussels: KEYW) publishes its financial results today of the third quarter of 2014 ending on 30 September 2014. The net profit of the third quarter and of the first nine months amount to EUR 387 k and EUR 1,018 k respectively, which is twice the result of the comparable periods recorded in 2013. In addition, the improved profitability of the second quarter is herewith confirmed.

Due to a strong third quarter of 2014 revenues over the first nine months of amounted to EUR 6,636 k which represents an increase of EUR 106 k or 1.62%.

The increased gross margin and other revenues as well as the significantly lower number of terminations contribute to the increase of EBITDA from EUR 1,094 k to EUR 1,421 k over the first nine months of 2014. In addition this period has to a smaller extent been impacted by bad debt write-offs due to bankruptcies which additionally accounts for the improved net result to EUR 387 k and EUR 1,018 k respectively compared to EUR 182 k and EUR 521 k during the comparable periods in 2013.

The third quarter itself also recorded a significant increase of revenues amounting to EUR 2,371 k compared to EUR 2,129 and EUR 2,136 for the second and the first quarter of 2014 respectively. Revenues increased by EUR 242 k compared to the previous quarter (+11.37%) and also for the last quarter of 2014 the forecast is positive. An equivalent quarter as the third quarter would lead revenues to a level of about EUR 9,000 k.

The increase in revenues has been triggered by the growth of the installed base, both within Keyware's traditional market as within the middle-market where clients can be found that need several terminals.

The lower number of bankruptcies in 2014 has also positively impacted the net-growth of the installed base. When comparing to the 2013 numbers one should take into account that during these comparable periods, macro-economic indicators reflected a high number of bankruptcies across the nation. This was also the case at Keyware as bad debt write-offs in those periods significantly exceeded the numbers recorded in previous years.

Authorisation revenues remain a growing and significant source of revenues. Keyware's approach consists of offering innovative solutions in order to smoothen the payment process in all aspects. Keyware's subsidiary, PayItEasy BVBA, fulfils a key role in this respect by further expanding payments services to other parties.

As stated above, Keyware expects full year revenues to be at about EUR 9,000 k and to confirm the EBITDA and net profit recorded in 2013, EUR 1,895 k and EUR 1,029 k respectively.

The figures

	Nine months ending on		3rd quarter
Key figures for the period	30.09,2014	30.09.2013	30.09.2014	30.09.2013
ending on 30 September	kEUR	kEUR	kEUR	kEUR
	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Revenues	6,636	6,530	2,371	2,022
Profit/(loss) for the period	1,018	521	387	182
EBITDA	1,421	1,094	515	386
Net cash flow	1,814	1,564	590	515

The figures of the first nine months and the third quarter of 2014 can be summarized as follows:

First nine months of 2014:

• the Group generated revenues of EUR 6,636 k compared to EUR 6,530 k for the same period in 2013, which represents an increase in revenues of 1.62%;
• the operating cash flow (EBITDA) for the first nine months came to EUR 1,421 k, versus EUR 1,094 k for the first nine months of 2013;
• the net profit for the period amounted to EUR 1,018 k compared to a net profit of EUR 521 k as at 30 September 2013;
• the net cash flow amounted to EUR 1,814 k compared to EUR 1,564 k as at 30 September 2013;
• the gross profit margin amounted to 76.99% which is in line with the previous year.

Third quarter of 2014:

• the Group generated revenues of EUR 2,371 k compared to EUR 2,022 k for the same period in 2013, which represents an increase in revenues of 17.26% during this quarter;
• operating cash flow (EBITDA) for the third quarter came to EUR 515 k, compared to EUR 386 k for the third quarter of 2013;
• the net profit for the period amounted to EUR 387 k compared to a net profit of EUR 182 k for the third quarter of 2013;
• the net cash flow amounted to EUR 590 k in comparison to EUR 515 k for the third quarter of 2013;
• the gross profit margin has been maintained at 79,33%.

REGULATED INFORMATION

About Keyware

Keyware (EURONEXT Brussels: KEYW) is a leading supplier of electronic-payment solutions, loyalty systems, identity applications and related transaction management. Keyware is based in Zaventem, Belgium. More information is available on www.keyware.com.

For additional information, please contact:

Mr. Stéphane Vandervelde President & CEO Keyware Technologies

Tel: +32 (0)2 346.25.23 ir@keyware.com www.keyware.com