StrongPoint — Investor Presentation 2016

Feb 19, 2016

Presentation of 4 th quarter and 2015 February 19th 2015 8:15 am

Agenda

• Highlights 4 th quarter & full year 2015
• Segment financials and status
• Business model, solutions/markets
• Strategy going forward
• Q & A

StrongPoint Mission

Driving retailers' productivity by providing innovative integrated technology solutions

Highlights 4 th quarter 2015

• Group operating revenues: MNOK 309.6 (MNOK 252.2)
• Group EBITDA: MNOK 20.0 (MNOK 26.8)
• First National Bank in South Africa 150 CashGuard systems
• NorgesGruppen renewed cash handling agreement
• BOD propose 29 per cent increase in dividend to NOK 0,45 per share (0,35)

	04 2015				04 2014
MNOK	Revenue	EBITDA	EBT	Revenue	EBITDA	EBT
Proprietary Technologies 1	121.6	0,3	$-3.7$	113,3	5,3	$-32.5$
3rd party Technologies	153,6	18,0	13,3	96.4	17,1	14,8
Labels	47,2	6,2	2,3	44,1	8,5	5.4
Eliminations / ASA	$-12.8$	$-4.6$	$-5.5$	$-1.7$	$-4.1$	$-9.2$
Total	309.6	20,0	6,6	252,2	26,8	$-21,6$

Highlights 2015

• Group operating revenues: MNOK 1 146.0 (MNOK 828.5)
• Group EBITDA: MNOK 90.5 (MNOK 61.0)
• Share price development 2015: 95 % (7,25– 14,15)
• Successful rollout of CashGuard upgrades for new notes & coins in Sweden
• Successful rollout of Pricer ESL to Meny grocery chain 175 stores
• StrongPoint Cash Security turnaround regained trust in Russia through own StrongPoint operation in Russia: Sberbank – Absolute Bank
• All-time high number of CashGuard systems internationally 828 (784)
• ONE Company re-branding

	Year 2015				Year 2014
MNOK	Revenue	EBITDA	EBT	Revenue	EBITDA	EBT
Proprietary Technologies 1)	481,5	46,6	34.1	445.8	32,0	$-17.9$
3rd party Technologies	504,5	39.4	29.1	237.1	25.5	20,1
Labels	185.5	22,7	8.5	168,5	17,1	4.8
Eliminations / ASA	$-25.5$	$-18.1$	$-22.1$	$-22.9$	$-13.6$	$-19.3$
Total	1 1 46,0	90.5	49.6	828,5	61,0	$-12.3$

Revenues per quarter 12 months rolling

EBITDA per quarter 12 months rolling

Revenues categories – 2015

	Year 2015		Year 2014
		Reccuring		Reccuring
MNOK	New sales	Sales	New sales	Sales
Proprietary Technologies	303,3	178,2	284.1	161,7
3rd party Technologies	390,4	114.1	162.7	74.4
Labels	0.0	185,5	0.0	168,5
Eliminations / ASA	$-25.5$	0.0	$-22.9$	0.0
Total	668,2	477,9	423.9	404.6

Revenues per geography - 2015

	Year 2015				Year 2014
			Other			Other
MNOK	Norway	Sweden	markets	Norway	Sweden	markets
Proprietary Technologies	128,9	193.7	159,0	133.6	192.1	120,1
3rd party Technologies	263,9	127,8	112,9	60,7	118,5	57,9
Labels	66,2	114,4	4,8	60,1	105,7	2,6
Eliminations / ASA	$-1.4$	$-16.2$	$-7.9$	$-0.3$	$-21.9$	$-0.7$
Total	457,6	419,7	268,8	254,1	394,5	179.9

Group balance sheet - Total assets

• Inventory up by MNOK 22.3 from end Q3
• A/R down by MNOK 61.1 compared to Q3

KNOK	31.12.2015	31.12.2014	30.09.2015
ASSETS
Intangible assets $11$	75469	86 175	77924
Goodwill	153 410	141 759	150 914
Tangible assets	55 069	42839	51 302
Long term investments	989	481	481
Other long term receivables		1850	1950
Deferred tax	28 117	39 221	29 217
Non-current assets	313 054	312 326	311 787
Financial investments		27	58
Goods	125 042	95 575	102 700
Accounts receivable	185 237	156 903	246 366
Prepaid expenses	12 092	10 323	11 4 7 9
Other receivables	17 317	16 7 21	19614
Bank deposits	22 610	18973	14 099
Current assets	362 297	298 522	394 316
TOTAL ASSETS	675 351	610847	706 103

Group balance sheet – Total equity & liabilities

Total net interest bearing debt MNOK 68.6 – down by 43.4 from end Q3

• Disposable liquidity MNOK 59.8
• 104 544 own shares, representing 0.2 per cent
• A/P MNOK 96.0 – down by 49.5 from end Q3

KNOK	31.12.2015	31.12.2014	30.09.2015
EQUITY AND LIABILITIES
Share capital	27 5 13	27 513	27 513
Holding of own shares	-65	-65	-65
Other equity	269 799	219 072	254 262
Total equity	297 247	246 520	281 711
Long term interest bearing liabilities	37 186	39 4 8 1	47 794
Other long term liabilities		28 691	30 240
Total long term liabilities	37 186	68 172	78 035
Short term interest bearing liabilities	54 0 25	46 634	78 342
Accounts payable	95978	105 502	145 504
Taxes payable	233	127	38
Other short term liabilities	190 682	143891	122 474
Total short term liabilities	340 918	296 155	346 358
TOTAL EQUITY AND LIABILITIES	675 351	610847	706 103

Financials – Cash flow statement

KNOK	04 2015	04 2014	Year 2015	Year 2014
Net cash flow from operation	54 194	62 318	54 268	45890
Net cash flow from investment	$-8929$	$-1600$	$-23024$	$-29529$
Net cash flow from financing	$-37003$	$-61295$	$-28483$	$-6288$
Net change in cash	8 2 6 2	-577	2 7 6 2	10 073
Effect of foreign exchange rate fluctuations on foreign currency deposits	248	914	875	345
Cash and cash equivalents at the start of the period	14 099	18 635	18973	8554
Cash and cash equivalents at the end of the period	22 610	18973	22 610	18973

• Cash flow from operational activities: MNOK 54.2 (MNOK 62.3)
• Working capital increased by MNOK 10.7 during 4th quarter

Segments

Third party technologies

4 th quarter and 2015 - highlights 4

• ESL Pricer roll-out with Meny supermarkets chain, 175 stores, completion November
• Installations to COOP/RIMI continues
• Continued work towards non-food
• Baltic 4th quarter revenues MNOK 46.4
• EBITDA MNOK 0.8
• First Pricer order delivered in Estonia
• Market leader Digi scales

	04		Year
MNOK	2015	2014	2015	2014
Product Sales	119.5	59.7	390.4	162.7
Service	34.1	36.6	114.1	74.4
Revenue	153,6	96.4	504.5	237,1
EBITDA	18.0	17.1	39.4	25.5
EBITDA-margin	11,7%	17.8%	7.8%	10.8%
EBT	13.3	14.8	29.1	20.1

Proprietary Technologies - Cash Security

4 th quarter and 2015 - highlights 4

• Successful turnaround
• Chosen as the preferred partner for Sberbank in Russia
• Chosen as a partner for Absolute Bank in Russia
• Own StrongPoint operation/legal entity in Russia critical success factor

	Q4		Year
MNOK	2015	2014	2015	2014
Product Sales	27.4	22.9	90.9	88.4
Service	10.4	6.3	45.4	28,5
Revenue	37,9	29.2	136,3	116.9
EBITDA	2,2	$-3.1$	11,8	$-1.7$
EBITDA-margin	5.8%	$-10.8%$	8.7%	$-1.5%$
EBT 1	1,1	$-37.8$	8,3	$-43.5$

Proprietary Technologies - CashGuard

4 th quarter and 2015 - highlights

• Heavy investments in Cash Management software
• Some obsolete inventory
• Heavy investments in APAC
• Pilot installations in KL/Singapore ongoing. 10 systems run as CashGuard as a service
• Prepare for new notes in Norway possibly 4000-5000 systems upgrade

	04		Year
MNOK	2015	2014	2015	2014
Product Sales	30.5	39.7	163.1	165.8
Service	30.9	27.7	110.2	109.0
Revenue	61.3	67.4	273,3	274.8
EBITDA	$-2.3$	10.9	33.7	37.0
EBITDA-margin	$-3.7%$	16.1%	12.3%	13.5 %
EBT	$-4.8$	7.2	25.5	29.3

Proprietary Technologies – Vensafe, Loss prevention

4 th quarter and 2015 - highlights

• Finally, on the positive side
• Upgrade campaigns in Norway & Sweden initiated
• Continued positive development in Belgium & Germany
• Pilots in South Africa

	04		Year
MNOK	2015	2014	2015	$2014^{11}$
Product Sales	15,7	9.0	49.4	29,9
Service	6,6	7.7	22.6	24.2
Revenue	22.4	16.7	72,0	54.1
EBITDA	0,4	$-2.5$	1,1	$-3,3$
EBITDA-margin	1,9%	$-14.7%$	1,5%	$-6,1%$
EBT	0,1	$-1.9$	0,3	$-3.6$
.

Labels

4 th quarter and 2015 - highlights

• 7 % increase in turnover
• Significant annual improvement of EBITDA
• Integration of manufacturing facilities in Norway completed

	04			Year
MNOK	2015	2014	2015	2014
Product Sales	47.2	44.1	185.5	168.5
Revenue	47,2	44.1	185,5	168,5
EBITDA	6,2	8.5	22.7	17.1
EBITDA-margin	13,2%	19.3 %	12,2%	10,2%
EBT	2,3	5.4	8,5	4.8

REDUCE THEFT INCREASE SECURITY CHECKOUT CONVENIENCE

REDUCE QUEUES PRICE INTEGRITY PAYMENT SIMPLICITY

INCREASE REVENUE REDUCE COST SHOP FLOOR SERVICE AND EFFICIENCY

Enabling store owners to reach their full potential

• Retail technology consulting
• Innovation

• System integration

• Installation and education

• Project planning and rollouts
• Service & support

Driving consumer shopping efficiency

HOW CONSUMERS BUY HOW CONSUMERS ARE REWARDED HOW CONSUMERS PAY

CONSUMER BEHAVIOR AND TRENDS

Solutions & Markets

Growth strategies

Summary – growth strategy going forward

• 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

2016 - Alimerka

• 5- year rental CashGuard as a service
• Top 20 grocery chains in Spain
• 170 stores
• Planned 50 systems installed per month
• StrongPoint partners

StrongPoint Vision

Becoming a recognised global provider of retail technology solutions

Coverage

	2015e	2016e	2017e
Net sales	3.7%	2.3%	nm
EBIT	49.6%	31.7%	nm
EPS (recurring)	44.1%	32.4%	nm

Welcome to the next StrongPoint public appearance

Questions?

Top 50 shareholders per January 31th 2015

No Name	No. of shares	%
1 PINNAS, ERIK (incl. fully owned companies) 1	4 932 276	11,1%	28 JOHANNESSEN, JAN TOMMY	271 000	0.6%
2 STRØMSTANGEN AS	3933092	8.9%	29 J.P. MORGAN CHASE BANK N.A. LONDON	254 320	0.6%
3 SKAGEN VEKST	3778352	8,5%	30 FANA ELEKTRIKEREN AS	250 000	0.6%
4 HOLMEN SPESIALFOND	2 365 000	5,3%	31 UGELSTAD, PER EINAR	246 115	0.6%
5 SKANDINAVISKA ENSKILDA BANKEN AB	1973240	4.4 %	32 VERDADERO AS	239 999	0.5%
6 AVANZA BANK AB	1776364	4,0 %	33 CK HOLDING AS	223 604	0.5%
7 NORDNET BANK AB	1674957	3,8%	34 SWEDBANK AB (PUBL)	218 807	0.5%
8 ZETTERBERG, GEORG (incl. fully owned companies)	1533256	3.5 %	35 BERNTSEN, HARALD	200 000	0.5%
9 GLAAMENE INDUSTRIER AS	1 246 933	2,8%	36 MIDDELBOE AS	192898	0.4%
10 WAALER, JØRGEN (incl. fully owned companies) 1	1 060 000	2.4%	37 PARTREDERIET MAST ANS	192 750	0.4%
11 GRESSLIEN, ODD ROAR	1 005 000	2.3%	38 GAMMELSRØD, GUNNAR	176840	0.4%
12 V. EIENDOM AS	976887	2,2%	39 GRANBERG, KARL TRYGVE	175 500	0.4%
13 CARNEGIE INVESTMENT BANK AB	893961	2,0%	40 HEIMDAL, MORTEN	170 000	0.4%
14 RING, JAN	726322	1.6%	41 KAWA INVEST AS	162 000	0.4%
15 MP PENSJON PK	699806	1,6%	42 WEIBULL, JOAQUIM (incl. fully owned companies)	152 000	0.3%
16 ROMULD, ARVE	600 000	1,4 %	43 G-EIENDOM AS	140 627	0.3%
17 BUDVILAITIS, EVALDAS (incl. controlled companies) 1	555 709	1.3%	44 BAKKEN, VIDAR	131079	0.3%
18 SVENSKA HANDELSBANKEN AB	508 194	1,1%	45 NÆSS, BERNHARD	130 000	0.3%
19 BJØRNSTAD, DANIEL	421560	0.9%	46 MAGNUS DEN GODE AS	125 000	0.3%
20 JACOBSEN, SVEIN (incl. fully owned companies) 1	400 000	0.9%	47 SHB INVESTERING AS	120 000	0.3%
21 JOHANSEN, STEIN	400 000	0.9%		119 000	0.3%
22 SAXO BANK A/S	395 150	0.9%	48 HAGEN, JOSTEIN MAGNUS
23 NISTAD GRUPPEN AS	338 300	0.8%	49 HERSETH, PER (incl. fully controlled companies) 1	114 043	0.3%
24 ANDERSEN, BØRGE	323 046	0.7%	50 STOCK PROPERTY INVEST AS	107 100	0.2%
25 EVENSEN, TOR COLKA	308 000	0.7%	Sum 50 largest shareholders	37 526 537	84,6%
26 KONGSRUD, RUNE JACOB	300 450	0.7%	Sum 1 363 other shareholders	6849503	15,4%
27 FRANKMO, ÅGE	288 000	0.6%	Sum all 1 413 shareholders	44 376 040	100.0%