Zwipe AS — Earnings Release 2023

Feb 22, 2024

Zwipe H2 2023 Report - new focus on Zwipe Access

Zwipe H2 2023 Report - new focus on Zwipe Access

OSLO, NORWAY - 22 February 2024 - Zwipe AS ("Zwipe" or "the company") today

announces its results for the first half of 2023.

Highlights H2 2023

· Zwipe successfully completes rights issue in December raising NOK 35 million

in gross capital, with a possible exercise of warrants in December 2024

representing the potential for up to NOK 39 million in additional funds.

· Cash position after full receipt of funds in December 2023 / January 2024 at

NOK 66.6 million.

· Slower than expected market adoption of biometric payment cards, but

significant traction in Zwipe Access.

· In Zwipe Access, more than 35 go-to-market ("GTM") partnerships are signed

or in progress and more than 65 proof of concepts ("PoCs") are underway.

· Total revenues of NOK 1.2 million during H2 2023, lower than the NOK 3.1

million reported in H2 2022.

· Net income for H2 2023 of NOK -43.9 million, substantially better than NOK

-57.1 million reported in H2 2022 and NOK -56.1 million in H1 2023.

Significant events after the period

· Zwipe announces new strategic direction focusing on Zwipe Access alongside a

company restructuring to create a near-term path to profitability.

· Zwipe Access successfully completes the operational test and evaluation by

National Safe Skies Alliance, Inc. (Safe Skies) at Richmond International

Airport (RIC).

H2 2023 operational review

Commenting on the second half of 2023, Zwipe CEO Robert Puskaric says, "Despite

our many go-to-market partnerships around the globe and 50+ dialogues with

issuers, market adoption of biometric payment cards in 2023 simply did not

happen as Zwipe or anyone else in the industry expected. Issuers continue to be

slow-moving meaning that commercial orders from our SCM customers and revenues

for Zwipe Pay were far lower than anticipated at the start of the year."

Progress in Zwipe Access has been much more positive, with Puskaric continuing,

"Much more optimistically, we have seen considerable interest in biometric

access control technology throughout 2023. Across the USA and Europe, we have

more than 35 Zwipe Access go-to-market partnerships, and these partners are

currently carrying out more than 65 proofs of concept." These proofs of concept

("PoCs") of Zwipe Access technology include end-user enterprises including

Fortune 100 companies, Top 3 cloud service providers, healthcare facilities,

airports, data centers, government agencies, and critical infrastructure

operators. [DG1] These PoCs are expected to translate into commercial orders and

meaningful revenue in the short term, with an additional, powerful growth

catalyst deriving from the EU NIS2 Directive on cybersecurity requirements in

critical infrastructure sectors.

In the USA, Zwipe Access completed a critical operational test and evaluation by

National Safe Skies Alliance, Inc. (Safe Skies) at Richmond International

Airport (RIC) early in 2024. The Safe Skies team's report offers a positive

assessment of Zwipe Access technology in airports and is expected to motivate

airports across the Americas to evaluate Zwipe Access technology. Zwipe

continues to make positive progress with our key GTM partners including

Schneider Electric, MC Dean, Matrix Systems and NCS in the Americas and in AWT,

Assa Abloy, Certego and others in Europe.

Fundraising and new strategic direction

The negative developments in Zwipe Pay and positive developments in Zwipe Access

during the second half led to our January 2024 announcement of a new strategic

direction for Zwipe, which will see the company focus our resources almost

exclusively on commercialization of Zwipe Access where the near-term commercial

opportunity is clear.

Just before the January 2024 announcement, Zwipe completed a rights issue in

December 2023 raising NOK 35 million in gross capital, with additional capital

possible from an exercise of warrants in December 2024. Funds raised in addition

to cash on hand will now be directed primarily to accelerating Zwipe Access

commercialization, with substantially less required to support additional

technology development or supply chain purchases associated with Zwipe Pay. When

combined with the June 2023 restructuring, Zwipe expects operational costs to be

more than NOK 40 million lower than in 2023. Total cash flow over the coming two

years is also expected to be more than NOK 40 million better than if Zwipe had

continued to focus on both business lines, giving Zwipe longer runway and

greater financial flexibility.  These decisive actions alongside funds raised

from the rights issue should put Zwipe on a path towards cashflow breakeven,

which we hope to reach in 2025.

H2 2023 financial review

Zwipe reported total revenues of NOK 1.2 million during H2 2023, lower than the

NOK 3.1 million reported in H2 2022 and the NOK 1.7 million reported in H1 2023.

Total operating expenses totalled NOK 44.6 million in H2 2023, down NOK 15.1

million compared to H2 2022, and down NOK 12.9 million compared to the first

half of 2023. The above resulted in net income for H2 2023 of NOK -43.9 million,

substantially better than NOK -57.1 million reported in H2 2022 and NOK -56.1

million in H1 2023.

Total net cash flow for H2 2023, including cash flow from financing and

investing activities, was NOK -33.7 million compared to NOK -59.3 million in H2

On 31 December 2023, cash and cash equivalents were NOK 42.2 million, compared

to NOK 50.5 million on 31 December 2022 and NOK 76.0 million on 30 June 2023.

With the remaining outstanding funds from the rights issue of NOK 24.4 million

received in early January 2024, the effective "turn of year" cash position was

NOK 66.6 million.

Going forward

Zwipe's priorities for 2024 all involve accelerating Zwipe Access

commercialization and maximizing Zwipe's financial flexibility:

· Close deals and announce major Access pilots and commercial deployments

during H1 2024, demonstrating commercial traction

· Achieve triple-digit growth in Zwipe Access in volumes and revenues in H2

2024 compared to H1 2024

· Launch new Zwipe Access products for a wider range of technology protocols

· Extend Zwipe's runway to get to cash flow breakeven in 2025.

Results presentation

CEO Robert Puskaric and CFO Hugo Petit will present the H2 2023 results by

webcast today, February 22nd, at 13:00 CEST.

Webcast details:

Date: 22 February, 13.00 CET

Format: webcast and Q&A

Language: English

Link:

https://app.webinar.net/bEArXRLNvJG (https://www.google.com/url?q=https%3A%2F%2Fa

pp.webinar.net%2FbEArXRLNvJG&sa=D&ust=1708187580000000&usg=AOvVaw3p5PowvnOfbn9Efx

uDmaNX)

Participants will be required to register to view the webcast and participate in

the Q&A, and are encouraged to submit their questions before the webcast to

ir@zwipe.com.

This information is subject to the disclosure requirements in the Market Abuse

Regulation (EU 596/2014) and the Norwegian Securities Trading Act section 5-12,

and is information that Zwipe AS is obligated to make public pursuant to the

continuing obligations of companies admitted to trading on Euronext Growth Oslo

(Euronext Growth Oslo Rule Book - Part II) and on Nasdaq First North Growth

Market. Certified Adviser on Nasdaq First North is FNCA Sweden AB, info@fnca.se.

The information was submitted for publication, through the agency of the contact

person set out below, at 08:00 on 22 February 2024.

About Zwipe

Zwipe believes the inherent uniqueness of every person is the key to a safer

future. We work with great passion across networks of international

organizations, industries and cultures to make convenience safe and secure. We

are pioneering next-generation biometric card and wearables technology for

payment and physical & logical access control and identification solutions. We

promise our customers and partners deep insight and frictionless solutions,

ensuring a seamless user experience with our innovative biometric products and

services. Zwipe is headquartered in Oslo, Norway, with a global presence.  To

learn more, visit http://www.zwipe.com.

For more information, please contact:

Hugo Petit, CFO and Head of IR

ir@zwipe.com

[DG1]Final number of PoCs and GTM partnerships at the end of Q4 needs to be

confirmed by ZA sales team. These are the numbers from end Q3