Q4 2023 report FEBRUARY 14TH, 2023

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Agenda

o Solid demand in a challenged marked
o Financial highlights
o Summary and Q&A

SaaS for SME construction companies

Industry challenges

o 0-5% margins -> High level of bankruptcies
o High level of conflict between construction company and customer
o High level of accidents and deaths
o Increasing demand for documentation and reporting

SmartCraft digital solutions

o Business overview and insight with control of people and material costs
o Digital flow of documentation to avoid conflict
o Safety at your fingertips
o Digital quality assurance to build according to rules and regulations

Renovation is our target segment

Renovation is our target market

o Large market, bigger than new build
o Less volatile, with consistent growth
o Downturn in new build affects the large construction companies, engineers and architects
o In a normal year 3% new build vs 97% existing buildings
o Existing buildings have constant demand for renovation, maintenance and service
o Energy efficiency drives further demand for renovation
o Ongoing digitalization of a digitally immature market

Norwegian construction market by segment, bNOK

Source: Prognosesenteret, 2023

Leading position in the Nordics

o Consistent and solid growth before and after the IPO in June 2021
o Constantly gaining market share
o 15 offices in Sweden, Norway and Finland
o 210 employees

Q4 2023 highlights

Continued strong growth, consistently high margins and low churn

2023 highlights

Continued strong profitable growth and solid operational cash flow

Our customers experience continuous solid demand

User data from our main solutions show good level of activities

Electronic invoice usage - Cordel

Average number of projects - Bygglet

Average number of check lists pr customer - Cordel

Increased momentum in Sweden

o Continued strong demand for Bygglet
- o 88% increase in booked meetings in Q4 YoY
- o Sales time down to 21 days in Q4 (28 days Q4 2022)
- o Sales conversions consistently high
o Successful pilot of integration to Visma eEkonomi

Booked Meetings (Bygglet)

Still challenging new build market in Finland

o 51% reduction in building permits from September to December (Y/Y) *
o Growth in Finland is reduced by lower activity in new construction projects from existing customers
o 122% growth in number of leads (QoQ)
o Customer revenue pipeline grew by 10%
o Churn is at a low level
o Project based revenue model implies a growth tailwind when market turns

* Statistics Finland Jan 2024

Customer revenue pipeline

Continued strong market situation in Norway

o Great sales activities
- o Signed 9 partner contracts (3 new) for scale and growth
- o 5% increase in customer leads (Q/Q)
- o Potential revenue pipeline is strong and at same level as at the end of Q3

New customer leads

Marketing and sales efficiency in Q4

o +595% (Y/Y) brand exposure¹
o 28% of new customers from online sales (21% Y/Y)
o Attended Elmässan & Bygg Reis Deg
o 23% more leads (YoY)
o 58% conversion rate from meeting to sales (55% Q3 LTM)
o Good start to 2024

*1 Response to SmartCraft communication in different media channels

Brand exposure for the SmartCraft Group

Online Sales in the SmartCraft Group

Solid performance in all segments

o Organic ARR growth +15% YoY
o Maintained strong pipeline with leads generating activities
o Less capitalization due to non-capitalizable research activities and year-end adjustments
o Organic ARR growth +18% YoY
o Good sales performance and positive trend
o Improved profitability due to scalability, bonus accruals and increased R&D capex
o Organic ARR growth -2% YoY
o Exposure to large customers in "new build" construction
o Increased potential revenue pipeline
o Growth offset by downgrades relating to new buildprojects
o Low churn of 5%

Continued growth in revenue and strong profitability

o Maintaining high recurring revenue share
o 14% organic growth in annual recurring revenue

o Increased marketing spending in Q4 2023 to generate long-term leads
o Agile business model to scale costs in a more demanding business climate with the ability to increase margin both shortterm and long-term
o Development of SmartCraft Core and integrations for cross sale and upsales
o 9.3% for FY'23

Solid financial position and strong cash flow

- to support growth strategy and M&A activity

Operating cash flow

mNOK, YoY growth

o Cash positive all quarters (seasonally strong Q1)
o YoY Cash increase in all quarters
o Cash generated from operations enables strategic investments and M&A

o Net cash positive
o Negative net working capital driven by customer prepayments
o Holds 1,85% (~3,2m) shares , per mid-February

High growth in recurring revenue as basis for success

o 21% growth in ARR
- o 4% organic growth quarter-over-quarter
o Annual price adjustments started in December
- o 5-8% vs 8-10% last year
- o Revenue tailwind throughout the year as price increases take effect at automatic contract renewals, price increases are thus spread out over 12 months

Quarterly ARR growth history, mNOK

ARR bridge YoY, mNOK

Some technology and product highlights

o Successful pilot of Visma eAccounting integration
o SmartCraft Accounting Connector processes +10.000 messages daily across different accounting systems
o Promising tests utilizing AI to assist customer success personnel
o Preparing SmartCraft Calculation for release in Q2

Key focus to ensure continued profitable growth Medium-term financial targets remain unchanged

o Customer centric business model
o Continue with marketing and sales excellence to build solid new customer pipeline
o More sales automation & self service
o Use our flexible business model to be prudent on costs
o Value accretive M&A

Margin expected to increase due to scalability of the business

Short-term considerations:

Impact from acquired companies last 12 months

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We continue to deliver on our profitable growth journey

o Continue to deliver on strategy
o Reduced operational risk
o Consistent strong operational cash flow

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SmartCraft ASA

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