StrongPoint — Investor Presentation 2016

Oct 21, 2016

Presentation of 3 rd quarter 2016 October 21st 8:15 am

Agenda

• Highlights 3rd quarter 2016 & YTD 2016
• Financial status
• South East Asia update
• New solutions update
• Marketing update
• Q & A

StrongPoint Mission

Driving retailers' productivity by providing innovative integrated technology solutions

Highlights 3rd quarter 2016

• Revenues MNOK 258,0 (288,9) 10,7 per cent
• Proprietary Technologies: 139,5 (120,9)
• 3rd Party Technologies: 82,0 (129,4).
• Alimerka project 387 systems installed Cash Management as a service
• All-time-high CashGuard systems (2 225) delivered YTD 1367 outside Norway & Sweden
• EBITDA MNOK 36,2 (26,8) + 35,2 per cent
• All-time-high EBITDA margin of 14,0 per cent (9,3 per cent)
• High capacity utilization in StrongPoint Cash Security alt-time-high EBITDA YTD MNOK 20,4
• Excellent cash flow from operations MNOK 23,8 (1,5)

Highlights YTD 2016

• Group operating revenues: MNOK 813.1 (MNOK 836.5)
• Group EBITDA: MNOK 80.8 (MNOK 70.5)
• Good cash flow from operations MNOK 80.5 (MNOK 0.1)

		YTD 2016		YTD 2015
MNOK	Revenue EBITDA		EBT	Revenue EBITDA		EBT
Proprietary Technologies	413,3	55,3	45.7	359,9	46.2	37,8
3rd party Technologies	271,3	22.6	16,9	350,9	21.4	15,7
Labels	139,0	15.9	5.1	138,3	16,5	6,1
Eliminations / ASA	$-10.5$	$-12.9$	$-11.6$	$-12.7$	$-13.6$	$-16,6$
Total	813,1	80,8	56,2	836,5	70.5	43,0

Revenues per quarter 12 months rolling

EBITDA per quarter 12 months rolling

3 rd quarter & YTD revenues by category

	03 2016			03 2015		YTD 2016	YTD 2015
	Recurring		Recurring		Recurring		Recurring
MNOK	New sales	sales	New sales	sales	New sales	sales	New sales	sales
Proprietary Technologies	91.7	47.7	66,6	54,2	258,0	155,3	229,7	130,3
3rd party Technologies	59,0	23.0	112,2	17,2	197,3	74.0	270,9	80,1
Labels	0,0	39.5	0,0	43.4	0,0	139,0	0,0	138,3
Eliminations / ASA	$-3.0$	0.0	$-4.8$	0,0	$-10,5$	0.0	$-12,7$	0,0
Total	147,8	110,2	174,1	114.9	444,8	368,3	487,8	348,6

3 rd quarter & YTD revenues by geography

	03 2016		03 2015		YTD 2016			YTD 2015
			Other			Other			Other			Other
MNOK			Norway Sweden markets Norway		Sweden	markets						Norway Sweden markets Norway Sweden markets
Proprietary Technologies	45.5	64.3	29,7	33.5	55,6	31.8	144.5	144.0	124.7	92.6	158.3	109.1
3rd party Technologies	29.2	35.3	17.5	80.5	24,2	24.8	100,8	108.7	61,9	185,4	97,1	68,5
Labels	13.3	25,6	0.6	14.2	27.9	1.3	45.2	91.5	2,2	48.8	85,9	3,6
Eliminations / ASA	$-0.1$	$-2,8$	$-0.0$	$-0.2$	$-4.0$	$-0.6$	$-0.1$	$-10.4$	$-0.0$	$-0.9$	$-11.3$	$-0.6$
Total	87.9	122.4	47,8	127,9	103.7	57,3	290.4	333.9	188.7	325.9	330.0	180.6

Group balance sheet - Total assets – 30.9.2016

• Inventory down by MNOK 10.3 from end Q2
• A/R up by MNOK 15.9 compared to Q2
• Goodwill write-down NV

KNOK	30.09.2016	30.09.2015	30.06.2016
ASSETS
Intangible assets	55 138	77924	60919
Goodwill	116 199	150914	145 643
Tangible assets	53 666	51302	54 462
Long term investments	1546	481	1346
Other long term receivables		1950
Deferred tax	19563	29 217	19493
Non-current assets	246 111	311787	281863
Financial investments		58
Goods	92582	102700	102922
Accounts receivable	198841	246366	182912
Prepaid expenses	11479	11479	12091
Other receivables	11 286	19614	12866
Bank deposits	11781	14 099	18082
Current assets	325 968	394 316	328874
TOTAL ASSETS	572079	706 103	610737

Group balance sheet – Total equity & liabilities

Total net interest bearing debt MNOK 32.5 – down by 12.6 from end Q2

• Disposable liquidity MNOK 71.4
• 104 544 own shares, representing 0.2 per cent
• A/P MNOK 97.3 – up by 11.2 from end Q2

KNOK	30.09.2016	30.09.2015	30.06.2016
EQUITY AND LIABILITIES
Share capital	27513	27513	27513
Holding of own shares	-65	-65	-65
Other equity	262862	254 262	248544
Total equity	290 310	281711	275 992
Long term interest bearing liabilities	22 1 22	47794	26414
Other long term liabilities		30 240
Total long term liabilities	22 1 22	78 035	26414
Short term interest bearing liabilities	22 160	78342	36729
Accounts payable	97 268	145 504	86087
Taxes payable		38
Other short term liabilities	140 219	122474	185 515
Total short term liabilities	259 647	346 358	308 331
TOTAL EQUITY AND LIABILITIES	572079	706 103	610737

Net interest bearing debt end of quarters

3 rd quarter & YTD – Cash flow statement

KNOK	03 2016	03 2015	YTD 2016	YTD 2015	Year 2015
Net cash flow from operation	23782	1493	80450	74	54 268
Net cash flow from investment	$-9087$	$-978$	$-18227$	$-14095$	-23 024
Net cash flow from financing	$-20170$	21	$-71311$	8520	-28 483
Net change in cash	$-5475$	535	$-9088$	$-5501$	2 762
Effect of foreign exchange rate fluctuations on foreign currency deposits	$-826$	836	$-1741$	627	875
Cash and cash equivalents at the start of the period	18082	12728	22 610	18973	18973
Cash and cash equivalents at the end of the period	11781	14 099	11781	14 099	22 610

Working capital decreased by MNOK 5.6 during 3rd quarter

News from labels

ONE factory in Sweden

First in Europe with HP8000 – enabling ONE factory

South East Asia update

First CashGuard order Singapore – Flower shop

First CashGuard order Kuala Lumpur, Parkson department stores

Second CashGuard order Singapore - Farm to Table,

Second CashGuard order Kuala Lumpur - Restaurant

Progress in Vilnius

First CashGuard order – Express Market

Marketing – Building StrongPoint

StrongPoint Vision

Becoming a recognised global provider of retail technology solutions

StrongPoint marketing – London

StrongPoint marketing – München

StrongPoint marketing – Essen

StrongPoint marketing – Moscow

StrongPoint marketing – New patents

StrongPoint marketing – Stockholm

StrongPoint marketing - Follow us at our Retail blog

http://www.strongpoint.com/

EuroShop 2017

1. – 9 th March - Düsseldorf

New solutions update

New Retail solutions – proprietary

Click & Collect - StrongPoint

New Retail solutions – proprietary

Click & Collect - StrongPoint

New Retail solutions – proprietary

Click & Collect - StrongPoint

Top 50 shareholders per September 30th 2016

No Name	No. of shares	%
1 PINNAS, ERIK (incl. fully owned companies)	4929917	11,1%	28 JOHANNESSEN, JAN TOMMY	304 800	0.7%
2 STRØMSTANGEN AS	3933092	8.9%	29 SWEDBANK AB (PUBL)	297 551	0.7%
3 SKAGEN VEKST	3 5 5 2 2 2 7	8.0%	30 KONGSRUD, RUNE JACOB	274 577	0.6%
4 HOLMEN SPESIALFOND	2 3 6 5 0 0 0	5.3%	31 J.P. MORGAN CHASE BANK N.A. LONDON	267 599	0,6%
5 AVANZA BANK AB	1868807	4,2%	32 UGELSTAD, PER EINAR	254 000	0,6%
6 ZETTERBERG, GEORG (incl. fully owned companies)	1568256	3,5%	33 FANA ELEKTRIKEREN AS	225 000	0.5%
7 NORDNET BANK AB	1534454	3.5%	34 CK HOLDING AS	223 604	0.5%
8 SKANDINAVISKA ENSKILDA BANKEN AB	1472554	3,3%
9 GLAAMENE INDUSTRIER AS	1 1 2 6 2 3 1	2,5 %	35 MIDDELBOE AS	217898	0,5 %
10 WAALER, JØRGEN (incl. fully owned companies) 1	1 060 000	2,4 %	36 NORDNET LIVSFORSIKRING AS	200 001	0.5%
11 V. EIENDOM AS	976887	2,2%	37 BERNTSEN, HARALD	200 000	0,5 %
12 GRESSLIEN, ODD ROAR	880 000	2.0%	38 HEIMDAL, MORTEN	195 000	0,4%
13 RING, JAN	841822	1,9%	39 PARTREDERIET MAST ANS	192 750	0,4%
14 MP PENSJON PK	692 074	1,6%	40 GAMMELSRØD, GUNNAR	187 355	0,4%
15 ROMULD, ARVE	600 000	1,4 %	41 GRANBERG, KARL TRYGVE	185 000	0.4%
16 D. CARNEGIE AB	593 139	1,3%
17 BUDVILAITIS, EVALDAS (incl. controlled companies) 1	555 709	1,3%	42 NEVROKIRO INVEST AS	180 000	0,4%
18 SVENSKA HANDELSBANKEN AB	510 684	1,2%	43 ALCHEMY TRADING AS	175 000	0.4%
19 JOHANSEN, STEIN	450 000	1,0%	44 KAWA INVEST AS	168 000	0.4%
20 JACOBSEN, SVEIN (incl. fully owned companies) 1	400 000	0,9 %	45 WEIBULL, JOAQUIM (incl. fully owned companies)	152 000	0.3%
21 VERDADERO AS	377 777	0,9 %	46 RUUD, CHRISTIAN	150 000	0,3%
22 BJØRNSTAD, DANIEL	361821	0,8%	47 NÆSS, BERNHARD	145 000	0.3%
23 NISTAD GRUPPEN AS	338 300	0,8%	48 G-EIENDOM AS	140 627	0.3%
24 FARSTAD, PETTER HAAVARD	338 000	0,8%
25 ANDERSEN, BØRGE	334 250	0.8%	49 SKOGEN, JOHN INGE PANDURO	138 471	0,3%
26 FRANKMO, ÅGE	323 212	0.7%	50 BAKKEN, VIDAR	135 000	0,3%
27 EVENSEN, TOR COLKA	306 000	0.7%	Sum 50 largest shareholders	36 902 446	83,2%
			Sum 1 332 other shareholders	7 473 594	16,8%
			$\mathbf{u}$ and $\mathbf{v}$ and $\mathbf{v}$ and $\mathbf{v}$	11.270.010	10000

Summary – growth strategy going forward

From Q4-2015 presentation

• Significant market investments in APAC & EMEA consolidate offerings and organizations. "Must" win efforts essential.
• Consolidate R&D common API/GUI StrongPoint Retail Highway StrongPoint Retail Suite
• StrongPoint growth combine organic with value based M&A
• StrongPoint e-Commerce footprint Retail applications

The road to success Questions?