Techstep ASA — Earnings Release 2020

Mar 31, 2020

Operational and financial update related to the COVID-19 outbreak

Operational and financial update related to the COVID-19 outbreak

Following the outbreak of COVID-19, Techstep has proactively taken steps to

safeguard employees, families, customers and partners. Furthermore, Techstep has

made efforts to minimise risk of business interruptions and is adhering to local

public health advisory across its locations. The company hereby provides an

operational and financial update related to the ongoing situation.

Employees' health and well-being are our highest priority

Techstep's main priority is the health of employees and their families. The

company has established business continuity plans and a dedicated task force.

Techstep is following updated guidelines from the Norwegian and Swedish

authorities to limit the spread of the virus and safeguard employees and

operational capabilities. Since 12 March, Techstep has run core operations via

decentralised locations and mobile home office solutions. Furthermore, Techstep

restricts physical meetings and all travel between borders or within countries

unless strictly necessary.

Impact on Techstep's operations

"Our business is to enable enterprises and employees do their work across mobile

devices and locations, with a high degree of security and operational stability.

The nature of what we do means that we are fortunate and well equipped to deal

with the current situation and maintain our own operations in a good way. When

it comes to our customers and the market in general, we see higher activities in

some areas, while the significant macroeconomic uncertainty and some hard-hit

sectors obviously curb customer demand in other areas. It's a mixed picture,

fundamentally, making work mobile has never been more relevant", says Jens

Haviken, CEO of Techstep ASA, adding "Right now our thoughts go to all those

making efforts to take care of people's health and flatten the curve. These are

tough times, but we will get through this by taking care of each other and

collaborating as a team".

Looking ahead, the coronavirus outbreak is likely to result in an extraordinary

impact on businesses and investments across several sectors, negatively

affecting overall demand for Techstep's offerings. In addition, risk related to

supply of hardware could increase.

Techstep is already experiencing reduced demand for its hardware offerings and

private enterprises are particularly affected by the outbreak. Demand for

Techstep's solutions and communication services, however, have been stable and

in some cases increased. The establishment of the Norwegian national coronavirus

hotline is an example of Techstep's latest deliveries within communication

support. It is too early to say whether the increased demand for solutions and

services will make up for reduced hardware demand longer-term.

As the current outlook signals overall reduced demand, Techstep has implemented

a temporary reduction in workforce capacity by approximately 20%, effective in

April. The temporary reductions are mainly within hardware sales and include

both Norwegian and Swedish employees. Software, operational and communications

services will continue as normal to serve existing and potentially new

customers' mobility needs.

Cost and capex flexibility

Techstep has operational, cost and capital expenditures flexibility and will

continue to adapt as market conditions evolve. Once such adaption is the

temporary workforce capacity reduction of approximately 20%. Techstep will

continue its software-related investments as planned, but other capital

expenditures will be reduced going forward. Financially, Techstep has a strong

balance sheet and limited net interest-bearing debt.

Jens Haviken, CEO of Techstep comments: "Looking ahead, we remain positive that

our mobility solutions will be even more relevant once the crisis abates. In

addition, our Flow offering enables us to help companies get mobility solutions

through our financing options, reducing the shorter-term liquidity need for our

customers' mobility and communication platforms".

Further information from:

Jens Haviken, CEO, Techstep ASA: +47 930 90 070

Marius Drefvelin, CFO, Techstep ASA: +47 958 95 690

About Techstep ASA

Techstep is positioning itself as a leading Nordic enabler of the digital

workplace. Techstep supplies hardware, software, connectivity and mobile device

management bundled as a managed service. This enables enterprises and their

employees to do their work across mobile devices and locations, with a high

degree of security and operational stability. Techstep has 211 employees based

in Norway and Sweden, serving close to 4,000 customers and 201,000 recurring

revenue end-users across various industries in the private and public sectors.

The company is listed on the Oslo Stock Exchange. For more information, see

www.techstepasa.no