Tecnotree Oyj — Earnings Release 2020

Feb 26, 2021

Tecnotree Corporation Financial Report for Q4 and Full Year 2020 (unaudited)

Tecnotree Corporation Financial Report for Q4 and Full Year 2020 (unaudited)

Tecnotree Corporation Financial Statement Release 26 February 2021 at 09:00 (CET
+1)

Strong earnings and cash flow

Fourth quarter 2020

· Fourth quarter net sales was EUR 14.2 (14.1) million.
· The adjusted operating result for the quarter was EUR 4.3 (4.1) million and
the operating result 4.3 (4.1) million.
· The adjusted result for the quarter was EUR 4.3 (2.8) million and the result
EUR 4.3 (2.8) million
· The order book at the end of the period stood at EUR 32.1 (25.5) million.
· Fourth quarter cash flow after investments was EUR 2.3 (-1.3) million.
· Earnings per share were EUR 0.02 (0.01).

Jan-Dec 2020

· Net sales for the financial period were EUR 52.8 (47.0) million.
· The adjusted operating result was EUR 19.3 (13.0) and the operating result
18.6 (14.4) million.
· The adjusted result for the period was EUR 14.2 (6.3) million and the result
EUR 13.6 (7.7) million.
· Cash flow after investments for the financial period was EUR 7.0 million
(0.1) and the company’s cash and cash equivalents were EUR 8.0 (3.4) million.
· Earnings per share were EUR 0.05 (0.03).
[][][][]
KEY FIGURES 10-12/ 10-12/ 1-12/ 1-12/
2020 2019 2020 2019
Net sales, MEUR 14,2 14,1 52,8 47,0
Adjusted operating 4,3 4,1 19,3 13,0
result, MEUR [1]
Operating result, 4,3 4,1 18,6 14,4
MEUR
Result before taxes, 4,2 3,4 15,9 11,8
MEUR
Adjusted result for 4,3 2,8 14,2 6,3
the period, MEUR [2]
Result for the 4,3 2,8 13,6 7,7
period, MEUR

Earnings per share, 0,02 0,01 0,05 0,03
basic, EUR

Order book, MEUR 32,1 25,5

Cash flow after 2,3 -1,3 7,0 0,1
investments, MEUR
Change in cash and 1,2 -1,9 4,7 -0,8
cash equivalents,
MEUR
Cash and cash 8,0 3,4
equivalents, MEUR

Equity ratio % 39,3 9,9
Net gearing % 27,1 292,2

Personnel at end of 659 600
period

[1] Adjusted
operating result =
operating result
before one-time
items.
[2] Adjusted result
for the period =
result for the
period before one
-time items.

CEO Padma Ravichander: An exceptional year 2020 ended on a high note

Year 2020 turned out to be an unprecedented year due to Covid-19. The pandemic
reshaped the world and also forced the telecommunication industry to reposition
itself in a changed market environment. While the slowdown of the global economy
was evident, we at Tecnotree, persistently continued to serve our customers and
enhance the product offering, leading to new record high profit levels and
highest order book position in last five years and overall a strong overall
financial position. The net profit margin was a record 25.7 % and the EBIT
margin 35.3 %, being at a remarkably satisfactory level. This performance in
2020 helped Tecnotree establish a strong footing, as we start the new year 2021.

Revenue
Full year revenue was EUR 52.8 million, 12.4 % higher than last year. Middle
-East and Africa region represented 74.6 % of the total revenue and witnessed
27.5 % growth from last year. Asia and Pacific region demonstrated very
promising development and outlook by doubling the revenue from last year from
EUR 1.2 million to EUR 2.4 million. Europe and Americas regions faced decline in
revenue, mainly due to the implications of COVID-19, however their outlook for
2021 seems positive. It is worthwhile to note that the Company was able to
demonstrate this growth despite the headwind caused by unfavourable EUR/USD
exchange rate movement.

Profitability
Operating profit and net profit improved in all four quarters of 2020 compared
to same quarters last year. The full year improvement in operating profit was
EUR 4.3 million and in net profit EUR 5.9 million. The fourth quarter net profit
was EUR 4.3 million being 54% higher than the same quarter last year. Earnings
per share (EPS) was 0.02 euros in the fourth quarter and 0.05 euros for the full
year 2020.

Order intake
Value of new orders recorded during financial period amounted to EUR 59.5
million, providing a solid EUR 32.1 million year-end order book compared to EUR
25.5 million in end of 2019. The full year order intake was 16% higher compared
to previous year. During the fourth quarter, Tecnotree recorded an order intake
of EUR 19.7 million.

Financial situation
Net cash flow after investments in the fourth quarter was EUR 2.3 million
positive and for the full year EUR 7.0 million positive. Cash and cash
equivalents in the end of the year were EUR 8.0 million. Liquidity wise the
company is well-positioned to meet its operating expense, investment and debt
repayment requirements.

Other business updates
Tecnotree continues robust growth in its business across global markets by
increasing the presence of our brand and taking advantage of the onset of 5G
implementations and the digital transformation requirements of our customers. In
2020, Tecnotree released a range of new products and solutions, including a
Fintech offering, Tecnotree Surge platform for Dual speed transformation and a
5G convergent charging platform, BSS Edge. We also acquired new customers for
our product suites in all geographies including Latin America (Telefonica and
Altice), Middle East (STC) and APAC (TRAI).

In 2021, we hope to synergize new partnerships with Digital Service Providers,
eco-system players and internet of things (IOT) providers, to introduce new
revenue models and API frameworks to take advantage of the 5G roll-outs world
-wide and forge new frontiers to empower digitally connected communities in the
sectors of Education, Health, E-commerce, Gaming, Sports and Entertainment.

Further information
Padma Ravichander, CEO, tel +97 156 414 1420
Priyesh Ranjan, CFO, tel +971 50 955 1188

About Tecnotree
Tecnotree is the only full stack digital business management solution provider
for digital service providers, with over 40 years of deep domain knowledge,
proven delivery and transformation capability across the globe. Our open source
technology based agile products and solutions comprise the full range (order-to
-cash) of business process and subscription management for telecom and other
digital service providers. Tecnotree products and platforms service over 800
million subscribers worldwide.Tecnotree is listed on Nasdaq Helsinki (TEM1V).
For more information, please visit www.tecnotree.com.

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