Saga Pure — Interim / Quarterly Report 2021

Aug 29, 2021

Saga Pure Q2 2021 report

Highlights 3
Responsibility Statement 5
Consolidated condensed statement of comprehensive income 6
Consolidated condensed statement of financial position7
Consolidated condensed cash flow statement 8
Consolidated condensed statement of changes in equity 9
Notes to the financial statements11

Highlights

NOK 1000	Apr-Jun 2021	Apr-Jun 2020		Jan-Jun 2021 Jan-Jun 2020
	(unaudited)	Restated*	(unaudited)	Restated*
Operating revenues Operating profit (-loss) before depreciation		- 49 067	107 633	-
(EBITDA) (1)	2 870	46 882	149 996	-53 347
Operating profit/(-loss) (EBIT) (2)	2 864	46 876	149 984	-54 358
Net profit/(-loss) from continuing operations	3 525	47 130	151 320	-53 847
Profit (loss) from discontinuing operations		- 1 950	-	3 313
Total comprehensive income total operations	3 525	49 080	151 320	-50 534
Basic earnings per share NOK (3)	0.01	0.18	0.32	-0.20
Diluted earnings per share NOK (3)	0.01	0.18	0.30	-0.20

(1) EBITDA can be calculated from the statement of income by deducting interest income, interest expenses and depreciation from the profit/(loss) before taxes.

(2) EBIT can be calculated from the statement of income by deducting interest income and interest expenses from the profit/(loss) before taxes.

(3) Basic earnings per shares is calculated by dividing shareholders earnings for the period by the average number of outstanding shares in the period. Diluted earnings per shares is calculated by adding potential shares with dilutive effect, in this case average issued equity options, to the average number of outstanding shares..

* Restated to reflect accounting impact of the disposal of Vallhall in Q4 20

Financial results

Saga Pure Group ("The Group") reports a net total comprehensive income for the second quarter 2021 of NOK 3.5 million. (NOK 151.3 million for the first half year of 2021).

EBITDA for the second quarter 2021 was NOK 2.9 million. (NOK 150.0 million for the first half year of 2021).

The Group had a loss from financial investments of NOK 45.0 million in the second quarter. (NOK 107.6 million in gain for the first half year of 2021).

The average number of outstanding shares in the quarter was 478,878,423. Total number of outstanding shares quarter end was also 478,878,423.

The Group had a cash holding of NOK 795.6 million at the end of second quarter, versus NOK 391.1 million per yearend 2020.

The Group completed one private placement, and three subsequent offerings during first quarter, raising net cash of NOK 146.3 million by issuing a total of 39.7 million shares. In addition NOK 85.0 million in restricted cash from the last private placement in 2020 was released.

Other major items in the cash flow for the first half year, is net cash from investments of 187.2 million.

The Group's condensed unaudited financial statements for the second quarter of 2021 are enclosed.

Company development and investments

With the three industry experts hired in the first quarter now in full operation, the Group is significantly strengthened operationally, and will continue to develop its core team going forward.

The Group held investments classified as non-current financial assets with a fair value of NOK 190.0 million. The fair value of the investments by the end of second quarter was as follows:

Horisont Energi AS	NOK 81 million
Heimdall Power AS	NOK 75 million
CRC Holding B.V. (Pryme)	NOK 34 million

Changes in market-value for these investments resulted in a loss of NOK 45.1 million for the second quarter. No disposals were made during second quarter.

The Group also held current financial investments with a fair value of 24 million at the end of the quarter. The current investment portfolio has been built up during the quarter in line with the new investment strategy, and contributed with a net gain of 0.1 million in the second quarter.

The Group has during the quarter invested additionally 15.0 million in the associated entity IC Technology AS ("ICT"). The Groups total investment in ICT is thereby 30.0 million for 32.6 % ownership of the company.

As for the associated company Bergen Carbon Solution AS, the Group has during the quarter sold 1.270.600 shares equalling the number of shares subscribed for in private placement in the quarter. Hence, the Group maintain its number of shares in the company during the quarter, but its share of the company is diluted from 21.4 % to 16.9 % while maintaining its investment in the company. However, this sale must also be seen in context to the exercise of options in the company as described in subsequent events.

Further the Group has acquired 29 % of the shares in Hyon AS, a company which among other things is developing hydrogen – and bunkering solutions for harbours. The Group is partnering with Nel ASA and Norwegian Hydrogen AS, which also holds a 29 % share each. The residual is owned by key employees of the company.

At end of the quarter the total carrying value of associates amounts to 65.5 million.

Subsequent events

On 28 July the Group announced that it will exercise its options in a private placement in Bergan Carbon Solution AS. After the transaction, the Group will hold 28 % of the company.

On 29 August, the Board of Directors passed a resolution to distribute dividend of NOK 0.10 per share, totalling NOK 47.9 million. The resolution was based on the Board of Directors authorization to resolute dividend as granted by the Annual General Meeting, and will be distributed to the shareholders without unnecessary delay.

Outlook

Focus on renewable energy and the transition towards a more sustainable future is gaining momentum, supported by ever-stronger policy measures from governments around the world. Alongside evaluating a number of investment opportunities Saga Pure is focused on building a team of strong and broad industrial competence in accordance with the new investment strategy. With no interest bearing debt, and substantial cash following the disposal of the former investments and recent private placements, the Group is well positioned for pursuing new possibilities within the new strategy. Covid-19 may affect the Group both through the equitymarket and through operations. The extent of impact and duration of the effects of the pandemic is difficult to predict. However, the Group will take appropriate measures both regarding health and safety issues regarding the pandemic effects, as well as for the protection of its investments. The concrete measures will be dependent on the development as it unfolds going forward.

Forward-looking statements

Matters discussed in this report may constitute forwardlooking statements. The forward-looking statements in this report are based on various assumptions, many of which are based upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies, which are difficult to predict and beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

Oslo, 29 August 2021

The Board of Directors

Responsibility Statement

We confirm, to the best of our knowledge, that the financial statements for the period 1 January 2021 to 30 June 2021 have been prepared in accordance with IFRS, as adopted by the EU, and give a true and fair view of the Group and the Company's consolidated assets, liabilities, financial position and results of operations. Furthermore, we confirm that the Report of the Board provides a true and fair view of the development and performance of the business and the position of the Group and the Company, together with a description of the key risks and uncertainty factors that the Company is facing.

Oslo, 29 August 2021

The Board of Directors

Martin Nes Chairman

Yvonne Litsheim Sandvold Board member

Øystein Stray Spetalen Board member

Christine Spiten Board member

Consolidated condensed statement of comprehensive income

NOK 1000	Apr-Jun 2021	Apr-Jun 2020	Jan-Jun 2021	Jan-Jun 2020
	(unaudited)	Restated*	(unaudited)	Restated*
Net gain from financial investments	-	49 067	107 633	-
Operating revenues	-	49 067	107 633	-
General administrative expense	5 702	2 225	10 035	4 805
Depreciation	6	6	12	12
Net loss from financial investments	44 982	-	-	49 585
Operating expenses	50 690	2 231	10 047	54 402
	53		52
Profit from associates	632	-	483	-
Operating profit/(-loss)	2 942	46 836	150 069	-54 402
Interest income	663	254	1 342	513
Interest expense	-2	0	-6	-2
Other financial items	-79	40	-85	43
Net financial items	583	294	1 251	555
Taxes	-	-	-	-
Net profit/(-loss) from continuing operations	3 525	47 130	151 320	-53 847
Profit (loss) from discontinuing operations	-	1 950	-	3 313
Net profit/(-loss) from total operations	3 525	49 080	151 320	-50 534
Other comprehensive income	-	-	-	-
Total comprehensive income	3 525	49 080	151 320	-50 534
Attributable to:
Non-controlling interests	-	1 219	-	1 838
Shareholders' interests	3 525	47 862	151 320	-52 373
Basic earnings per share NOK	0,01	0,18	0,32	-0,20
Diluted earnings per share NOK	0,01	0,18	0,30	-0,20
Average number of shares in the period	478 878 423	266 149 831	475 549 847	266 149 831
Number of shares outstanding at period end	478 878 423	266 149 831	478 878 423	266 149 831

* Restated to reflect accounting impact of the disposal of Vallhall in Q4 20

Consolidated condensed statement of financial position

NOK 1000	30.06.2021	31.12.2020
	(unaudited)	(audited)
ASSETS
Non-current assets
Associates	65 505	30 003
Non-current financial assets	190 032	276 447
Fixed Assets	4	16
Total non-current assets	255 541	306 465
Current assets
Other current assets	3 676	385
Current financial investments	23 817	-
Restricted cash (Note 4)	-	85 000
Cash and equivalents	795 616	391 113
Total current assets	823 109	476 497
TOTAL ASSETS	1 078 650	782 963
EQUITY AND LIABILITIES
Equity
Share capital	4 789	4 391
Other equity	1 206 938	1 059 771
Total paid-in-capital	1 211 727	1 064 163
Accumulated losses	-140 478	-291 798
Total equity	1 071 249	772 365
LIABILITIES
Non-current liabilities
Other non-current liabilities (note 3)	2 462	5 922
Total non-current liabilities	2 462	5 922
Current liabilities
Other current liabilities and accruals	4 939	4 676
Total current liabilities	4 939	4 676
Total liabilities	7 401	10 598
TOTAL EQUITY AND LIABILITIES	1 078 650	782 963

Consolidated condensed cash flow statement

NOK 1000	Jan-Jun 2021	Jan-Jun 2020	Jan-Dec 2020
	(unaudited)	(unaudited)	(audited)
Net profit/(-loss) from continuing operations	151 320	-53 847	155 974
Profit (loss) from discontinuing operations	-	3 313	22 988
Profit before tax total operations	151 320	-50 534	178 962
Gain on disposal of discontinued business	-	-	-19 389
Options and share program	-2 212	-	6 144
Result from associates	-52 483	-	-
Depreciation	12	1 575	1 036
Net loss/(-gain) from financial investments	-107 633	49 585	-172 888
Foreign exchange losses/(gains)	-	-5	-5
Interest received	-	-25	-25
Interest paid	-	981	-
Income tax paid	-	-55	-55
Changes in other accrued income and expenditure	-3 028	-1 369	24
Net cash flow from operating activities	-14 024	153	-6 196
Investment in non-current financial assets and associates	-186 003	-	-92 554
Divestment in non-current financial assets and associates	395 739	51 534	175 701
Net divestment/(-investment) trading	-22 252	7 010	39 210
Dividends received	-	-	2 284
Net cash effect disposal of subsidiaries	-	-	28 783
Receivable	-	340	340
Interest received	-	25	25
Investment in fixed assets	-	-1 090	-
Net cash flow from investing activities	187 211	57 819	153 789
Share issue net of costs*	231 316	-	212 503
Repayments of long term borrowings	-	-1 000	-1 000
Dividends paid to non-controlling interests	-	-	-2 442
Distributions to controlling interests	-	-26 615	-53 230
Interest paid	-	-981	-
Net cash flow from financing activities	231 316	-28 596	155 831
Net change in cash and cash equivalents	404 503	29 376	303 424
Cash and equivalents at beginning of period	391 113	87 684	87 684
Net foreign exchange differences (unrealised)	-	5	5
Cash and equivalents at end of period	795 616	117 065	391 113

* Share issue of net MNOK 85, as completed 29 December 2020, classified as restricted cash in 2020, cash effect in 2021.

Consolidated condensed statement of changes in equity

Jan-Jun 2021 (Unaudited) NOK 1000	Issued capital	Other equity	Accumulated losses	Total
Equity as at 1 January 2021	4 391	1 059 771	-291 798	772 365
Net profit/(-loss)	-	-	151 320	151 320
Total comprehensive income	-	-	151 320	151 320
Share issue	397	148 610	-	149 007
Share issue costs	-	-2 691	-	-2 691
Options and share program (note 3)	-	1 249	-	1 249
Equity per ending balance 30 June 2021	4 789	1 206 938	-140 478	1 071 249

Jan-Jun 2020 (Unaudited) NOK 1000	Issued capital	Other equity	Accumulated losses	Other reserves	Non controlling interests	Total
Equity as at 1 January 2020	2 661	819 655	-468 791	-2 648	20 156	371 032
Net profit/(-loss) continuing operations	-	-	-53 847	-	-	-53 847
Net profit/(-loss) discontinuing operations	-	-	1 475	-	1 838	3 313
Total comprehensive income	-	-	-52 373	-	1 838	-
Dividends to controlling interests	-	-26 615	-	-	-	-26 615
Equity per ending balance 30 June 2020	2 661	793 040	-521 164	-2 648	21 994	293 883

Jan-Dec 2020 (Audited) NOK 1000	Issued capital	Other equity	Accumulated losses	Other reserves	Non controlling interests	Total
Equity as at 1 January 2020	2 661	819 655	-468 791	-2 648	20 156	371 032
Net profit/(-loss) continuing operations	-	-	155 974	-	-	155 974
Net profit/(-loss) discontinuing operations	-	-	21 019	-	1 969	22 988
Total comprehensive income	-	-	176 993	-	1 969	178 962
Dividends to controlling interests	-	-53 230	-	-	-	-53 230
Dividends to non controlling interests	-	-	-	-	-2 442	-2 442
Disposal of minorities	-	-2 648	-	2 648	-19 683	-19 683
Share issue	1 730	301 370	-	-	-	303 100
Share issue costs	-	-5 597	-	-	-	-5 597
Options and share program (note 7)	-	222	-	-	-	222
Equity per ending balance 31 December 2020	4 391	1 059 771	-291 798	-	-	772 365

Notes to the financial statements

Note 1 – Basis for preparation

The Company's condensed interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as approved by the EU and requirements in the Norwegian Securities Trading Act. This condensed interim financial statement for the first quarter is approved by the Board of Directors on 29 August 2021.

The accounting policies applied in the preparation of the condensed interim financial statements are consistent with those presented in the Annual Report of 2020.

Foreign currency

The financial statements are presented in NOK. NOK is also the functional currency for the Company.

Note 2 – Operating Segments

In October 2020 the Group disposed of the lease and operation of property-segment, accordingly the Group have currently only one active segment (Investments)

		Investment			Vallhall			Other			Total
Segment	Jan-Jun	Jan	Jan	Jan	Jan	Jan	Jan	Jan	Jan	Jan	Jan	Jan
information	2021	Jun	Dec	Jun	Jun	Dec	Jun	Jun	Dec	Jun	Jun	Dec
NOK 1000		2020	2020	2021	2020	2020	2021	2020	2020	2021	2020	2020
Income
Net gain/loss on
investments	107 633	-49 585	174 476	-	-	-				107 633	-49 585	174 476
Total income	107 633	-49 585	174 476	-	-	-	-	-	-	107 633	-49 585	174 476
Operating expenses - excluding loss in
investments	10 047	4 817	19 329	-	-	-				10 047	4 817	19 329
				-	-	-
Net operating profit/loss from continuing operations	97 586	-54 402	155 974	-	-	-	-	-	-	97 586	-54 402	155 974
Profit (loss) from
discontinuing
operations	-	-	-	-	1 362	22 988				19 389	1 362	22 988
						31			31
	30 Jun 2021	30 Jun 2020	31 Dec 2020	30 Jun 2021	30 Jun 2020	Dec 2020	30 Jun 2021	30 Jun 2020	Dec 2020	30 Jun 2021	30 Jun 2020	31 Dec 2020
					104					1 078
Assets	1 078 650	253 154	782 963	-	884	-	-		-	650	358 038	782 963
Liabilities	7 401	3 753	10 598	-	60 419	-	-		-	7 401	64 155	10 598

Note 3 – Options and share program

In the equity-settled option and share program, additional 9,000,000 options was issued to new employees in first quarter, bringing the total of issued options to 27,000,000. No additional options were issued during second quarter. The current vesting periods of the program is ending in the period between 19 April 2022 and 24 February 2024. The cost of the options in the second quarter amounts to 0.7 million as straight line initial fair value costs, and 0.6 million as cost reduction caused by net reversal of social security costs following the share price development through the quarter. Total social security reserves was reduced from NOK 3.0 million to 2.5 million booked as non-current liabilities.

Note 4 – Restricted cash

The Group had 85 million as short-term restricted cash as per end of 2020. The cash related to the net cash of the private placement of 30 million shares at 2.9 NOK per shares, as registered at 30 December 2020. The cash was released from the deposited account at 4 January 2021.

Note 5 – 20 largest investors

	Name	Shares	Of total shares
1	*ØYSTEIN STRAY SPETALEN	172 841 799	36,09 %
2	*TYCOON INDUSTRIER AS	28 550 000	5,96 %
3	**SIMONSEN INVEST AS	18 858 667	3,94 %
4	CLEARSTREAM BANKING S.A.	18 500 258	3,86 %
5	DALLAS ASSET MANAGEMENT AS	9 187 461	1,92 %
6	OLA STORMYR HOLDING AS	6 045 513	1,26 %
7	NORDNET LIVSFORSIKRING AS	5 550 628	1,16 %
8	Nordnet Bank AB	4 568 120	0,95 %
9	MELCHER HOLDING AS	4 200 000	0,88 %
10	FRØILAND INVEST AS	3 454 554	0,72 %
11	KVANTIA AS	3 045 000	0,64 %
12	SPAR KAPITAL INVESTOR AS	2 515 016	0,53 %
13	***HANEKAMB INVEST AS	2 300 000	0,48 %
14	****EL INVESTMENT AS	2 300 000	0,48 %
15	STORM & CO AS	2 290 000	0,48 %
16	HEGE BAKKEN	2 211 580	0,46 %
17	ATLE SANDVIK PEDERSEN	2 000 000	0,42 %
18	The Bank of New York Mellon SA/NV	1 987 887	0,42 %
19	BJØRN HÅVARD BRÆNDEN	1 908 438	0,40 %
20	ROY HAGEN	1 858 000	0,39 %
	Total	294 553 887	61,50 %
	Total outstanding shares	478 878 423	100,00 %

* Board member/controlled by Board member Øystein Stray Spetalen

** Controlled by Bjørn Simonsen, CEO of Saga Pure

***Controlled by Martin Nes, Chairman of the Board

**** Controlled by Espen Lundaas, CFO of Saga Pure

Note 6 – Subsequent events

On 28 July, Saga exercised its option for subscription of 4,978,000 shares in Bergen Carbon Solution AS in a private placement, at a total consideration of 30 MNOK. After the placement, the Group will hold 28 % of the shares in the company.

On 29 August, the Board of Directors passed a resolution to distribute dividend of NOK 0.10 per share, totalling NOK 47.9 million. The resolution was based on the Board of Directors authorization to resolute dividend as granted by the Annual General Meeting, and will be distributed to the shareholders without unnecessary delay.

Title: Saga Pure Q2 2021 report Saga Pure ASA

Published date: 30 August 2021

Saga Pure Q2 2021 report

info@saga-pure.com

Sjølyst Plass 2, 0278 Oslo, Norway

The publication can be downloaded on saga-pure.com

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