Techstep ASA — Earnings Release 2021

Feb 11, 2022

Techstep ASA: Q4 2021 results

Techstep ASA: Q4 2021 results

Highlights Q4 2021

· Revenue of NOK 384 million (NOK 399 million), quarterly decrease reflects

transition to recurring revenue model and higher share of one-off deliveries in

2020

· Gross profit of NOK 123 million (NOK 146 million) reflect revenue

development and realization of transactional hardware backlog

· EBITDA adjusted of NOK 25 million (NOK 51 million), reflecting gross margin

in the quarter

· Recurring revenues in the fourth quarter of NOK 266 million (annualized),

including Own Software, Advisory & Services and Hardware-as-a-Service

· Focus on transformation from a transactional to a recurring revenue business

model, driven by software and value adding services

· Signed 11 new managed mobility service contracts, with an estimated value of

NOK 48 million and ~12,600 managed devices in the quarter

· Aligning new management team with software-led growth strategy, Anita Huun

appointed CFO and Sheena Lim appointed CMO

· Divestment of non-core business unit, Voice & Contact Center, to streamline

the organisation and increase focus on core product offering

Commenting on the quarter and the future of Techstep, CEO, Børge Astrup says:

"Techstep continued on our longer-term transformation journey in the fourth

quarter to be the leading European mobile technology enabler for customers that

want to work smarter and more sustainable. We are transforming our business

model from one-off transactional sales to having full focus on selling our

product offering as a recurring revenue bundle. We have an exciting market

opportunity in front of us and we are sharpening our products and go-to-market

approach to capture it in the best possible way in the years to come in a market

that has an annual double-digit growth.

There is a lot of activity ongoing, during March will we launch the rebranding

of Techstep. The rebranding will give a clearer message, storyline and position

of how we support customers through smarter mobile technology for a brighter

tomorrow through our "Smart" product portfolio.

We closed 11 managed mobility services contracts in the quarter, and we are

obviously very happy with the vote of confidence shown by Norway's largest

financial services group, DNB. We are also pleased to see our pipeline of

opportunities and look forward to converting further opportunities into new

business and added commercial momentum.

We are confident that our sales development over time will be very positive. We

are streamlining the organisation and strengthening the management team with

specialist roles in both marketing and sales. With the restructuring, we are

also shifting our investment towards the commercial division and optimizing the

supporting systems and leads generating initiatives.

We passionately believe in the power of technology to drive positive change -

for organisations right now and for the future as they at the same time deliver

on their ESG commitment. Mobile technology makes employees happier and more

productive by freeing them up to work smarter. That's not just great for

organisations but for the planet too. By working hard to make our solutions

genuinely sustainable we're making good on our responsibility to future

generations. We will translate this into commercial success stories for our

customers, and for Techstep.

At the same time, Techstep's financial results are not at the level we want to

see them. We want higher sales and improved profitability. Our 2021 results

reflect ongoing restructuring and transformation but will start to improve once

our sales pick up, and our recurring revenue business model and higher margin

software and value-adding services are increasingly adopted by our customers

across our markets. We will need to complete the organisational restructuring,

implementation of our new ERP and CRM systems, and not least get our new

management team in place to accelerate our market penetration, drive sales and

improve profitability materially.

To succeed with the ongoing transformation into a software and value-adding

services company, we are streamlining the organisation and aligning the company

around our products and the customer journey. Performance management will be

closely linked to customer success, recurring services and revenue growth, and

ultimately value creation and profitability. We broke the 100 million ARR mark

on our own Software IP with the deals signed in Q4. An important milestone for

us.

Making our world a little smarter, happier and more sustainable is how we'll

know we're getting things right" says Børge Astrup, CEO of Techstep" says Børge

Astrup, CEO of Techstep

Material

Please find the report and presentation for Q4 2021 enclosed.

resentation:

The presentation will be held as a pre-recorded webcast with slides. The

presentation, released today at 07:00 CET, is held in English by CEO Børge

Astrup and CFO Marius Drefvelin. To watch the presentation please use this

link: https://youtu.be/8hAxOxr4NI4

A Q&A session will take place as a virtual event today at 10:00 CET. Please join

the session via the following link: https://bit.ly/3B0ciiU

Questions for the Q&A session may be submitted in advance to ir@techstep.no, or

live during the session itself.

A recorded version of the Q&A-session will be made available on techstepasa.no

shortly after the Teams webinar has been concluded.

For more information:

Børge Astrup, CEO, Techstep ASA: +47 928 27 676

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

Erik Haugen, CTO, Techstep ASA: +47 967 90 101

About Techstep ASA

Techstep is a complete mobile technology enabler, making positive changes to the

world of work; freeing people to work more effectively, securely and

sustainably. We help customers who want to work smarter, while also delivering

on their ESG commitments. With more than 350 employees based in Norway, Sweden,

Denmark and Poland, we serve more than 2,000 enterprise customers in Europe.

Techstep has NOK 1.3 billion in full year 2021 revenues, and is listed on the

Oslo Stock Exchange under the ticker TECH. To learn more, please visit

techstepasa.no (http://www.techstepasa.no).

This information is subject to the disclosure requirements pursuant to section 5

-12 of the Norwegian Securities Trading Act. This stock exchange release was

published by Marius Drefvelin, CFO, on 11 February 2022 at 07:00 CET.