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3. merger and acquisition

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Link Mobility Group ASA
Financial Result
Second quarter 2015
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Highlights Q2 2015
Growth through organic developments and acquisitions
Link Mobility Group (LINK) started off 2015 with a solid Q1. The financials for Q2 2015
prove that the positive trend continues. Q2 2015 gave revenue of MNOK 78,9 and an
EBITDA of MNOK 11,2, representing a solid growth in revenue and EBITDA compared with
Q1 2015. Giving YTD 2015 revenue of MNOK 151,2 and EBITDA of MNOK 19,9.
During Q2 2015 LINK acquired Fivestarday AB, a Swedish prizewinning company
developing mobile solutions for the B2B market, and Cool Group ApS, one of Denmark’s
largest suppliers of B2B mobile communication. Through these acquisitions and LINK’s
organic development and growth, LINK has strengthened its position as the largest B2B
mobile service provider in the Scandinavian and Baltic markets significantly. The financial
result YTD 2015 for LINK including the acquired companies shows combined revenue of
MNOK 185,6 and combined EBITDA of MNOK 25,7.
TNOK
Revenues
Total operating revenues
YTD 2015
Link
151 225
151 225
YTD 2015
Acquisitions
34 402
34 402
YTD 2015
Total
185 627
185 627
Cost of services rendered
Payroll
Other operating expenses
Total operating expenses
89 077
30 321
11 928
131 327
20 069
6 138
2 379
28 586
109 146
36 460
14 307
159 912
19 898
5 816
25 715
EBITDA
The acquisitions of Fivestarday AB and Cool Group ApS
18 May 2015 LINK acquired all shares in Fivestarday AB. The company has assisted big
Swedish brands in their successful development of digital and mobile customer relation
strategies and solutions. The acquisition of Fivestarday is a result of LINK’s strategy to
become a complete provider of mobile B2B solutions for all businesses, public services and
organizations. Fivestarday was purchased at the price of MSEK 4,2, where MSEK 2,1
represent a possible earn out the sellers can obtain if Fivestarday meets certain sales and
financial targets during the first 24 months after closing. For further information regarding
the acquisition see note 2, 8 and 11.
30 June 2015 LINK acquired all shares in Cool Group ApS. Cool Group ApS owns 100 per
cent of the subsidiaries CoolSMS A/S, CoolTEL ApS and CoolSystems ApS. Cool Group
has, in addition of being a leading SMS aggregator, operator status. The operator status
gives Cool Group a unique position in the market, as it can transmit SMS traffic directly into
the other Danish operators’ network. Resulting in lower costs and high quality in terms of
delivery reliability. Through the acquisitions of Cool Group, LINK has become a leading
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player in the Danish mobile B2B market, gained operator status and has increased its total
capacity in terms of technology and operational resources. The enterprise value of Cool
Group was MDKK 75, 2014 EV/EBITDA of 6. For further information regarding the
acquisition see note 2, 8, 10 and 11.
The acquisitions prove that LINK delivers upon its communicated strategy of creating
growth, by both increasing its share in existing markets and by entering new markets.
Furthermore, by combining LINK's, Fivestarday’s and Cool Group's wide range of mobile
services, operational resources, technology, business models and skilled employees, LINK
is about to reach its ambition of becoming a complete provider of mobile solutions for its
thousands of customers. LINK has now the capacity and capability to serve all companies,
public services and organizations that are “going mobile” in order to satisfy their customers’
and users’ rapidly growing demands for mobile services. LINK can assist in the whole
process; from developing mobile strategies and building mobile infrastructures to operating
mobile marketing/dialog with customers and providing mobile payment solutions.
A total of MNOK 2,5 of acquisition costs were booked in Q2 2015.
Increasing market share in existing markets represent great potential
The growth in revenue was mainly driven by the business segment LINK Dialog. In Q2
2015 LINK sent 184,4 million SMS on behalf of its customers, representing an increase of
13 percent from Q1 2015 and an increase of 35 percent from Q2 2014 (adjusted for
business acquired in 2014). The Norwegian business increased its A2P SMS market share
with 0,41 percentage point from 38,54 to 38,95 of the total market. Whereas the Swedish
business increased its A2P SMS market share by 3 percentage points from 13 to 16
percent.
4,7 million unique Norwegian mobile subscribers and 4,8 million unique Swedish
subscribers received SMS provided by LINK in Q2 2015. Given the total Norwegian
population of 5,2 million and the Swedish population of 9,8 million, LINK proves to have the
customer portfolios, technology and resources to assist its customers in reaching a
remarkable percentage of the population in its markets.
LINK’s solid customer portfolio, large markets shares and regular mobile communication
with a remarkable percentage of the mobile subscribers, give a unique position for further
growth in other mobile business segments as customers tend to start their path towards a
more complete mobilizing after first having taken SMS in use. Being a provider of complete
mobile solutions, LINK can assist all existing and potential customers towards the level of
mobilization fit for their businesses.
Given LINK’s growing organization in 5 geographical markets and the market’s increasing
demand for complete mobile solutions, LINK is about to establish a Solutions Sales Unit at
Group level to ensure optimal focus on its new solution Next. Through this new customer
software LINK can offer the market a mobile solution that manages every aspect of
customer dialog and allows customers to manage loyalty programs and target mobile
dialog; starting with look-up of a variety of information and registration of clients to
automatic dialog flow, segmentation tools, analytic tools and payment solutions. The
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software can be implemented in POS, ecommerce platforms or other ERPs and can be part
of every businesses core systems.
6 of 10 employees invested in LINK
11 May 2015 LINK announced a Share Incentive Program offering all employees of the
Group shares at NOK 27,80, the closing value at Oslo Stock Exchange at the day of the
announcement. More than 60 percent of the Group’s employees invested in LINK shares,
proving their trusts in LINK’s future financial performance and the employees’ long-term
commitment to the Group. For further information regarding the Share Incentive Program
see note 10.
Final settlement of PSWinCom AS deal reduced debt
Final settlement of the PSWinCom AS (PSW), that took place in Q2 2015, reduced the
seller’s credit from the seller of PSWinCom AS, Stabben AS, with MNOK 4,2. For further
information regarding the reduction of the seller’s credit see note 8.
01 June 2015 PSWinCom AS merged successfully with Link Mobility AS, creating Norway’s
largest mobile B2B solutions company.
Solid cash position
LINK had cash and cash equivalent of MNOK 46,3 per 30.06.2015.
Comfortable credit covenants and level of financial costs
Long-term liabilities related to acquisitions amounted to MNOK 84,7, MNOK 52,4 in seller’s
credits and MNOK 31,8 in debt to financial institutions. No debt bearing an interest of more
than 5 percent. For further information regarding the long-term liabilities see note 8.
Short-term liabilities related to acquisitions amounted to MNOK 24,7, MNOK 18,5 in
shareholders’ loan with an interest of NIBOR 3M + 5 percent and MNOK 6,2 to Eniro AS
that bears no interest. For further information regarding the short-term liabilities see note 9.
New contracts and business
On Group level, LINK experienced some major positive developments in Q2 2015 with
regards to its Telenor partnerships:
!
LINK delivers a platform to Telenor Group for handling direct operator billing to
Telenor´s 13 markets across the Nordic region, Central and Eastern Europe and in
Asia. During Q2 there has been a significant increase of transactions and new
partners have been launched their services.
!
LINK completed some major developments in its client lookup, search and SMS
messages for Microsoft Lync in Q2 2015. LINK will together with Telenor Unified
Communications launch new versions of Office 365 with Lync and Skype for
Business for the Scandinavian market in August 2015.
In the Norwegian market, LINK won the following contracts of financial and strategically
importance in Q2 2015:
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!
Oslo Stock Exchange signed an agreement with LINK regarding delivery of mobile
information messaging and mobile payment. The agreement included SMS alerts
and notifications for stocks, corporate announcements and fund prices and indices in
real time.
!
OBOS, Norway’s larges property developer with more than 2.000 employees, chose
LINK’s mobile solutions for SMS alert and crisis management.
!
Valyou, DnB and Telenor’s payment app, chose LINK's technology for the
registration of new uses and to facilitate 2-way customer interaction.
!
Sykepleierforbundet, Norwegian Nurses Organization with 100.000 members, chose
LINK’s solutions for handling of enrollment and administration of member portfolio.
!
Kristiansand Zoo, one of Norway’s most visited tourist attractions, entered an
agreement with LINK that enabled the Zoo to offer all visitors complete mobile
services through mobile marketing, registration and sales as well as the possibility
for mobile payment of parking.
!
PostNord Logistics, a leading Nordic logistics company, chose LINK’s services to
send mobile notification to all end-users about when and where their parcel has
arrived. The solution includes tracking of packages.
In the Swedish market, LINK won several contracts of financial and strategically importance
in Q2 2015:
!
Gina Tricot, the Swedish retailer with 135 Nordic shops, chose LINK as partner for
developing CRM strategy and CRM solutions for the Swedish market.
!
Trygg Hansa assigned LINK to develop a mobile app that will be able to publish,
inform and support sales for all Trygg Hansa’s insurance products.
!
Aurora Innovations chose LINK as partner in developing and operating its highly
distinguished call back services. Aurora Innovations provides services in Sweden,
Finland and Norway via its services TeleQ and Spondi, which are used by
approximately 70 percent of the Swedish population when contacting medical
services. LINK will deliver look-up regarding personal credentials and SMS services.
The Danish acquired business, Cool Group, won one particular important contracts in Q2
2015:
!
KMD A/S, one of Denmark’s leading IT- & software companies with 3.000
employees, a turnover 5 billion DKK and more than 400 IT-systems to host, chose
Cool Group’s SMS solutions.
In Q2 2015 LINK also expanded its indirect sales through partnerships, especially in the
Swedish market.
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Financial Performance
LINK had revenue of MNOK 78,9, gross margin of MNOK 31 and EBITDA of MNOK 11,2 in
Q2 2015, giving a gross margin ratio of 39 percent and an EBITDA ratio of 14 percent.
PSW was acquired 30 December 2014 and is not included in LINK’s official financial reports
for 2014. Analysis of LINK’s 2015 financials in terms of comparisons with previous periods
will therefore have to be based on the following Consolidated Profits and Loss statement
that also include PSW:
TNOK
Revenues
Total operating revenues
Q2 2015
78 919
78 919
Q2 2014
65 964
65 964
Change
12 955
12 955
∆%
20 %
20 %
Cost of services rendered
Payroll
Other operating expenses
Total operating expenses
47 925
12 486
7 260
67 671
36 593
12 226
5 261
54 080
11 332
260
1 999
13 591
31 %
2%
38 %
25 %
EBITDA
11 248
11 884
-636
-5%
Compared with the financial performance in Q2 2014, the revenue increased with 20
percent by MNOK 13 from MNOK 66 to MNOK 78,9. The revenue growth was to a large
extent driven by the business segment LINK Dialog increasing its share of the total revenue
from 58,8 percent in Q2 2014 to 63,9 percent in Q2 2015.
Gross margin increased with MNOK 1,6 from MNOK 29,4 to MNOK 31. Reducing the total
margin ratio from 44 percent to 39 percent. The reduction was mainly a result of LINK
Dialog’s growth relatively to the other business segment combined with a fall in LINK
Dialog’s margins. In addition, MNOK 0,5 of Q1 2015 costs were booked in Q2 2015 due to
incorrect billing from an operator. The acquisition of Cool Group gives LINK both operator
status and increased SMS volumes, and LINK is about to launch a project at Group level to
increase SMS margins. LINK Payment margin fell due to a higher share of donations with
low margins.
EBITDA was reduced with 5 percent by MNOK - 0,7 from MNOK 11,9 to MNOK 11,2, giving
a reduction of the EBITDA margin from 18 percent to 14 percent. A total of MNOK 2,5 in
acquisition costs were booked in Q2 2015. Adjusting for those extraordinary costs, the Q2
2015 EBITDA is MNOK 13,7. Giving an increase in EBITDA of MNOK 1,8, compared with
Q2 2014, and an EBITDA ration for Q2 2015 of 17 percent.
The figures on the next page show the overall financial development during the period from
Q1 2014 to Q2 2015, including businesses acquired in 2014, in terms of revenue, gross
margin and EBITDA.
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Revenue%
Margin%
EBITDA%
78,9%
MNOK%
72,8%
65,9%
60,7%
61,4%
29,4%
11,9%
4,1%
Q2%2014%
31,2%
31,1%
27,4%
22,4%
Q1%2014%
72,3%
6,8%
Q3%2014%
5,6%
Q4%2014%
31%
8,7%
Q1%2015%
11,2%
Q2%2015%
Underlying seasonal trends in the mobile B2B market, create seasonal variations in most
business segments. Resulting in relatively weak Q1 and Q3, and strong Q4, as shown in
the development through the four quarters of 2014.
Q1 2015 and Q2 2015 show the same seasonal pattern, and that there is a strong
underlying growth in revenue. Weaker margin ratio is caused by the increasing share of
SMS revenue of the total revenue at lower margins. Measures are taken to improve SMS
margins. Adjusting for extraordinary acquisition costs of MNOK 2,5 in Q2 2015, EBITDA
shows positive development.
The figures on the next page show revenue per business segments in terms of MNOK and
in terms of the percentage of LINK’s total revenue during the period Q1 2014 to Q2 2015.
The figures include businesses acquired in 2014.
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ConsulFng%
License%
Mobile%Payment%
Mobile%Dialog%
78,9%MNOK%
72,8%MNOK%
72,3%MNOK%
58,5%%%
61,4%%%
17,5%%%
15,8%%%
14,1%%%
21,8%%%
20,1%%%
18,8%%%
65,9%MNOK%
61,4%MNOK%
60,7%MNOK%
55,4%%%
27,3%%%
58,8%%%
16,2%%%
63,9%%%
57,9%%%
19,0%%%
22,9%%%
21,6%%%
2,2%%%
2,2%%%
1,6%%%
2,2%%%
2,8%%%
3,3%%%
Q1%2014%
Q2%2014%
Q3%2014%
Q4%2014%
Q1%2015%
Q2%2015%
15,1%%%
LINK Dialog’s share of the total revenue has been increasing over the last four quarters,
and represent in Q2 2015 63,9 percent of LINK’s revenue and 45 percent of the gross
margin. After the acquisition of Cool Group LINK Dialog will, based on the Q2 2015
financials, represent approximately 70 percent of total revenue.
LINK Consulting’s share of the total revenue has increased over the last quarters, and
represents 3,3 of LINK’s revenue in Q2 2015. The increase is mainly due to the delivery of
complete mobile solutions for Olav Thon Group 107 shopping centres’ customer clubs.
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Market conditions and outlook
LINK is, due to the general expanding market for B2B mobile services and the recent
acquisition of Fivestarday and Cool Group, expecting continuing growth in terms of both
revenue and profits. In the short run, the growth will be driven mainly by SMS and
application sales.
LINK’s strategy has for the last 2 years been to expand its LINK Dialog, LINK Payment,
LINK Licence and LINK Consulting services in order to become the leading provider of B2B
mobile solutions in the Scandinavian and Baltic markets. During this period LINK has more
than doubled revenue, quadrupled profits and reached the goal of becoming the main
player in its markets.
Rapid technological developments have in the same period changed peoples’ use of mobile
phones significantly. Today, more than half of all global Google search is done by mobile
devices whereas a relatively little share of companies’, public services’ and organizations’
businesses are mobilized to such an extent that they meet the users’ present and future
demands for mobile services. LINK therefore expects an increase in the market for
complete B2B mobile services over the next years. When “going mobile”, businesses will
have to integrate mobile technology and solutions into their core business systems. LINK
has the software, technological platforms, operational resources and experience to assist
all these businesses in their drive towards mobilization. The market and LINK have
simultaneously reached the point of development, where it is natural for LINK to start
directing its main focus towards solutions sales.
LINK’s ambition for the next years is to become the main provider of complete mobile
solutions within its existing geographical markets as well as in new markets. All companies,
public services and organizations with B2C business are potential customers of LINK’s
complete B2B mobile solutions.
Future growth, like past growth, will be achieved through a combination of further
development of the exiting LINK business as well as through M&As.
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Consolidated Profit and Loss
Note
2Q 2015
2Q 2014
YTD 2015
YTD 2014
Year 2014
Revenues
Total operating revenues
3
78 919
78 919
40 940
40 940
151 225
151 225
76 446
76 446
161 375
161 375
Cost of services rendered
Payroll
Other operating expenses
Total operating expenses
4
47 925
12 486
7 260
67 671
22 470
8 704
2 827
34 001
89 077
30 321
11 928
131 327
46 274
16 174
6 278
68 726
94 783
38 532
11 608
144 923
11 248
6 939
19 898
7 720
16 452
Depreciation and amortization
3 728
1 794
7 320
3 036
6 668
Operating profit
7 520
5 145
12 578
4 684
9 784
61
4 427
740
512
3 237
74
0
170
-36
-60
114
4 677
1 510
854
2 427
75
0
253
11
-189
196
0
420
487
-711
10 757
5 085
15 005
4 495
9 073
Income tax expense
2 880
1 329
4 027
1 198
1 680
Profit for the period
7 876
3 756
10 978
3 297
7 393
0,817
0,792
0,484
0,466
1,137
1,104
0,425
0,409
0,882
0,851
-329
7 547
190
7 013
-481
10 497
649
10 059
44
7 437
EBITDA
Interest income
Other financial income
Interest expense
Other financial expenses
Net financial items
8
8,9
Profit before tax
Earnings per share (NOK/Share)
Earnings per share
Diluted earnings per share
Exchange rate differences Group
Total comprehensive income
2,10
2,5,10
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Consolidated Balance Sheet
Note
30.06.2015
30.06.2014
31.12.2014
Assets
Non-current assets
Deferred tax assets
Intangible assets
Equipment and fixtures
Total non-current assets
0
223 784
2 650
226 434
7 117
46 823
826
54 766
0
130 528
2 274
132 802
40
40
0
0
40
40
Current assets
Trade receivables and other receivables
Cash and cash equivalents
Total current assets
86 773
46 331
133 144
40 953
32 496
73 449
78 399
18 488
96 887
Total assets
359 578
128 215
229 729
8 383
1 258
67 064
35 709
16 400
128 814
7 758
0
49 415
0
2 001
59 174
7 758
625
50 490
16 574
6 341
81 789
12 842
12 942
0
0
2 670
2 670
52 385
31 800
84 662
14 372
0
14 372
34 280
2 200
36 480
18 500
6 159
103 937
5 140
133 738
5 000
0
49 669
0
54 669
20 000
0
88 790
0
108 791
Total liabilities
230 765
54 669
147 941
Total equity and liabilities
359 578
128 215
229 729
11
Inventories
Total inventories
Equity and liabilities
Equity
Share capital
Not registered share capital
Share premium
Not registered share premium
Other equity
Total equity
10
10
10
10
Deferred tax
Deferred tax
Total Deferred tax
Long-term liabilities
Seller’s credit
Debt to financials institutions
Total long term liabilities
Short-term liabilities
Shareholder loan
Debt to Eniro AS
Trade and other payables
Tax Payable
Total short term liabilities
8
8
9
9
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Statement of change in equity
Balance at 31.12.2012
Profit for the year
Issue of share capital
Value of warrant
Currency translation differences
Balance at 31.12.2013
Balance at 31.12.2013
Profit for the year
Issue of share capital
Net profits purchase/sale own shares
Currency translation differences
Balance at 31.12.2014
Balance at 31.12.2014
Profit for Q1 and Q2 2015
Issue of share capital
Other correction
Currency translation differences
Balance at 30.06.2015
Note Ordinary shares
6 347
Share premium Uncovered losses
27 320
-4 052
1 729
22 095
559
667
49 415
-1 097
Total equity
29 615
1 729
23 506
559
667
56 076
Note Ordinary shares
7 758
Share premium
49 415
625
16 574
1 075
8 383
67 064
Total equity
56 076
7 393
17 199
1 075
45
81 788
Note Ordinary shares
8 383
Share premium
67 064
1 258
35 709
1 411
7 758
10
9 641
102 773
Other equity
-1 097
7 393
45
6 341
Other equity
6 341
10 978
-438
-481
16 400
Total equity
81 788
14 345
36 967
-438
-481
128 814
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Consolidated Cash Flow Statement
2Q 2015
2Q 2014
YTD 2015
YTD 2014
2014
Cash flow from operating activities
Profit before tax
Taxes paid
Depreciation and amortization
Net interest in profit and loss
Interest received
Interest paid
Change in trade receivable and other receivables
Change in trade and other payables
Net cash flow from operating activities
10 756
-272
3 728
3 237
61
-297
-18 180
15 176
14 209
5 085
-413
1 793
60
75
-40
-18 981
31 720
19 299
15 005
-272
7 320
2 427
114
-607
3 183
-6 464
20 706
4 495
-413
3 036
189
75
-87
13 016
-9 063
11 248
9 073
-876
6 668
711
196
-602
-24 503
41 188
31 855
Cash flow from investing activities
Proceeds from purchase of intangible assets
Cash added with purchase of subsidiary
Purchase of tangible assets
Purchase of intangible assets
Net cash flow from investing activities
-95 698
11 965
-309
-162
-84 204
330
-1 406
-1 076
-95 698
11 965
-685
-1 238
-85 656
-80
-35 195
-35 275
-55 367
7 978
-737
-36 975
-85 101
Cash flow from financial activities
Proceeds from borrowings
Repayment of borrowings
Proceeds from issuing new shares
Net profits from purchase/sale of own shares
Net cash flow from financial activities
Foreign exchange effect on cash
Net change in cash and cash equivalents
Cash and cash equivalents at the beginning for the period
Cash and cash equivalents at end of the period
62 564
-2 254
36 969
-2 053
62 564
-6 007
36 969
16 425
-2 053
97 279
-2 053
93 526
14 372
17 200
-6 159
17 199
1 076
29 316
-582
155
-733
18
285
26 702
19 629
46 331
16 325
16 171
32 496
27 843
18 488
46 331
-9 637
42 133
32 496
-23 645
42 133
18 488
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Note 1 – General information
Link Mobility Group ASA is a private limited company registered in Norway. Link Mobility Group ASA is the parent
company of the Link Mobility Group (Group) and owns 100 per cent of the subsidiaries Link Mobility AS, Link Mobility AB
in Sweden, Link Mobility SIA in the Baltics and the Cool Group ApS in Denmark. The Group’s headquarter is located in
Oslo, Norway.
PSWinCom AS was merged with Link Mobility AS 01 June 2015.
Link Mobility AB purchased all shares in the Swedish company Fivestarday AB 18 May 2015.
Link Mobility Group ASA purchased all shares in the Danish company Cool Group ApS 30 June 2015. Cool Group ApS
owns 100 per cent of the subsidiaries CoolSMS A/S, CoolTEL ApS and CoolSystems ApS.
The Group provides mobile services that enable companies, public services and NGOs to have mobile communication
with their customers and users. The Group offers products and services extending from mobile dialog, mobile marketing,
mobile payment, mobile CRM and mobile applications. The Group’s business is classified into the business segments;
Mobile Dialog, Mobile Payment, Mobile License and Consulting.
Note 2 – Basis for preparation / Accounting Policies
The interim financial statement for the second quarter 2015 has been prepared in accordance with IAS 34 “Interim
Financial Reporting”. The financial statement should be read in conjunction with the annual financial statement of the
financial year 2014, which have been prepared in accordance with IFRS and the financial statements for the four quarters
2014 and the first quarter 2015 that have been prepared in accordance with IAS 34 “Interim Financial Reporting”. The
accounting policies adopted are consistent with those of the previous financial reporting.
The Group’s Board of Directors approved the financial statement for the second quarter 2015 on 17 August 2015.
The financial statement has not been audited or reviewed by the auditors.
The Group’s presentation currency is Norwegian kroner (NOK), which is also the parent company’s functional currency. All
amounts are stated in 1.000 NOK.
Consolidation
The consolidated financial statements show the total financial results and financial position of the parent company, Link
Mobility Group ASA, and its subsidiaries Link Mobility AS, Link Mobility AB and Link Mobility SIA that are 100 per cent
owned by Link Mobility Group ASA, and are fully consolidated in the consolidated financial statement.
30 June 2015 Link Mobility Group ASA acquired all shares in Cool Group ApS from Sundahl Aps. The transaction value
(enterprise value of Cool Group ApS) was MDKK 76,6. MDKK 25,8 was paid at closing. MDKK 25 was paid in shares in
Link Mobility Group ASA based on closing value at Oslo Stock Exchange 29 May 2015 of NOK 29,90, which gave Sundahl
ApS 989.073 shares. The remaining is seller’s credit to be paid no later than 36 months after closing. The seller’s credit
bears an interest of 5 percent p.a., and is to be paid monthly. The cash part of the transaction was financed by a loan from
Danske Bank. The loan, which bears an interest of 4,75 percent, is to be paid by equal quarterly instalments over the next
three years.
18 May 2015 Link Mobility Group ASA’s fully owns subsidiary, Link Mobility AB, acquired all shares in Fivestarday AB from
Reynholm Industries AB. Of the purchasing price of MSEK 4,2, MSEK 2,1 was paid at closing. The seller of Fivestarday
can obtain an additional premium of maximum MSEK 1,8 based on the sales of certain services developed by Fivestarday
at the time of closing and sold within 24 months after closing. An additional premium of MSEK 0,3 can be paid to the seller
in October 2015 subject to certain conditions linked to Fivestarday AB's financial position per 30 September 2015.
The Group’s consolidated result for Q2 2015 includes the result for Fivestarday AB for the period 19 May 2015 – 30 June
2015, whereas Cool Group ApS’s result is not included in the consolidated result for Q2 2015 as the company was
acquired 30 June 2015. The balances of Fivestarday AB and Cool Group ApS per 30 June 2015 are included in the
Group’s consolidated balance Q2 2015. Cool Group ApS’s final closing balance per 30 June 2015 is to be settled by
September 2015.
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Note 3 – Revenue and segment reporting
The tables below show the revenues generated, by countries and business segment.
Revenues by segment
Dialog
Payment
License
Consulting
Total
2Q 2015
50 397
11 138
14 829
2 555
78 919
2Q 2014
20 916
8 411
10 546
1 066
40 940
YTD 2015
94 767
22 557
29 338
4 563
151 225
YTD 2014
38 432
21 197
14 844
1 974
76 446
Year 2014
80 515
42 378
34 635
3 847
161 375
Revenues per country
Norway
Sweden
Latvia
Total
2Q 2015
61 410
15 977
1 532
78 919
2Q 2014
28 808
11 376
756
40 940
YTD 2015
119 271
28 432
3 522
151 225
YTD 2014
50 718
22 474
3 254
76 446
Year 2014
106 667
47 703
7 005
161 375
YTD 2014
27 541
14 751
3 668
314
46 274
Year 2014
56 890
29 432
7 793
668
94 783
Note 4 – Cost of services rendered
The table below shows cost of services rendered related to sales per business segment.
Dialog
Payments
Licenses
Consulting services
Total
2Q 2015
36 341
8 227
3 022
336
47 925
2Q 2014
14 300
6 046
1 976
148
22 470
YTD 2015
66 077
16 058
6 280
663
89 077
Note 5 – Warrants!
In April 2014 Futurum Capital AS bought 300.000 warrants in Link Mobility Group ASA. The warrants strike price is NOK 6
per share with a term of 3 years.
In May 2015 Futurum Capital AS sold 20.000 warrants to each of the flowing employees of the Group:
Johan Andersen, CEO Link Mobility Group ASA
Siw Ødegaard, CFO Link Mobility Group ASA
Krister Tånneryd, Managing Director, Link Mobility AB
Fredrik Nyman, Sales Director, Link Mobility AB
Guro Røed, KAM Manager, Link Mobility AS
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Note 6 – Related party transactions
The following transactions were carried out with related parties:
Sales (+) and purchases (-) of goods and services (excl. VAT)
Crayon AS (Jens Rugseth, Rune Syversen)
Complit Holding AS (Jens Rugseth, Rune Syversen)
2Q 2015
-129
-92
2Q 2014 YTD 2015 YTD 2014
-19
-28
Year 2014
-159
-1
3
-184
-166
-340
Futurum Capital AS (Harald Dahl)
-
-206
-
-539
-539
Kvinnesiden AS (Siw Ødegaard)
-
-
-
-80
-80
2Q 2014 YTD 2015 YTD 2014
Year 2014
Period-end balances arising from sales/purchases (incl. VAT)
2Q 2015
Crayon AS (Jens Rugseth, Rune Syversen)
-61
-24
-61
-24
1
Complit Holding AS (Jens Rugseth, Rune Syversen)
-38
-38
-38
-38
-38
-
-17
-
-17
-
2Q 2014 YTD 2015 YTD 2014
Year 2014
Futurum Capital AS (Harald Dahl)
Loans from related parties
Unsecured loan (principal loan) from Rugz AS (Jens Rugseth)
2Q 2015
-8 500
-2 500
-8 500
-2 500
-10 000
-10 000
-2 500
-10 000
-2 500
-10 000
Outstanding interests on the loan from Rugs AS (Jens Rugseth)
-489
-126
-498
-126
-25
Outstanding interests on the loan from Sevencs AS (Rune Syversen)
-521
-126
-521
-126
-28
Unsecured loan (principal loan) from Sevencs AS (Rune Syversen)
Note 7 - Options
11 May 2015 an option program was implemented. A total of 750.000 options were given to executive management and
other key employees of the Group. The options are to be earned over a 3 year period; meaning that 250.000 options can
be earned as of 30 April 2016, another 250.000 options can be earned as of 30 April 2017 and the remaining 250.000
options can be earned as of 30 April 2018. The options must be exercised at the latest by 31 October 2018; if not, they will
expire without any compensation. If the options are exercised, the price per share shall be equal to the closing value at
Oslo Stock Exchange on 11 May 2015, NOK 27,80. No fees were paid nor will be paid for the options.
Note 8 – Long-term liabilities
Seller’s credit:
!
Seller’s credit from Stabben AS from the purchase of PSWinCom AS 30 December 2014, amounting to MNOK
19,8 is to be paid within 36 months from closing. The debt bears an interest of 5 per cent that is to be paid
quarterly. As a result of the final settlement of the PSWinCom AS deal, the seller’s credit was reduced with
MNOK 4,2 in Q2 2015.
!
Seller’s credit from Sundahl ApS from the purchase of Cool Group ApS 30 June 2015, amounting to MDKK 25,8
is to be paid within 36 months from closing. The debt bears an interest of 5 per cent that is to be paid monthly.
See note 2 for more information regarding the acquisition.
!
Seller’s credit to Reynolds Industries AB form the acquisition of Fivestarday AB 18 May 2015 of MSEK 2,1 relates
to an earn out agreement of a period of 24 months after closing. The seller’s credit bears no interest. See note 2
for more information regarding the acquisition and the earn out agreement.
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Debt to financial institutions:
!
In relation to the acquisition of Cool Group ApS, Danske Bank lent the Group MNOK 30. The loan bears an
interest of 4,75 per cent. The interests are to be paid quarterly. The debt is to be paid by equal quarterly
instalments over the next three years.
!
Through the acquisition of PSWinCom AS, the Group took over a loan from Sparebanken Vest that amounts to
MNOK 1,8. The loan bears an interest of 5 per cent. A total of MNOK 0,1 is paid monthly in interests and down
payment.
Note 9 – Short-term liabilities
The shareholder loans provided by Sevencs AS (MNOK 10) and Rugz AS (MNOK 8,5) bear an interest of NIBOR 3M + 5
per cent.
MNOK 6,2 in seller’s credit from Eniro AS after the acquisitions of the Intouch business in March 2014 bears no interest.
The debt will be paid with equal instalments of MNOK 2 over the next 3 quarters.
Note 10 – Increase in share capital
The Board of Link Mobility Group ASA decided to increase the share capital with NOK 268.997 by issuing 268.997 new
shares at par value NOK 1 at the price NOK 27,80 per shares at its meeting 18 June 2015. The shares were issued
related to the Share Incentive Program for the Group’s employees where 60 per cent of the employees acquired shares.
The Board of Link Mobility Group ASA decided to increase the share capital with NOK 989.073 by issuing 989.073 new
shares at par value NOK 1 at the price NOK 29,90 per shares at its meeting 30 June 2015. The shares were issued to
Sundahl ApS, the seller of Cool Group ApS. See note 2 for more information regarding the acquisition.
The total of NOK 1.258.070 new shares increased the share capital from NOK 8.383.314 to NOK 9.641.384.
The increase in share capital was registered with the Norwegian Register of Business Enterprise by 24 July 2015. The
increased share capital of NOK 1.258.070 and increased share premium of NOK 36.698.077 are thus stated as
“respectively “Not registered share capital” and “Not registered share premium” in the balance per 30 June 2015
Note 11 – Acquisition Of Business
Cool Group ApS
Link Mobility Group ASA acquired all shares in Cool Group ApS 30 June 2015. The transaction value was set to MDKK
76,6.
Acquisition analysis
100% of the shares Cool Group ApS
Cash
Link Mobility Group ASA shares
Seller’s credit
Total purchase price
Book value of equity
Book value of existing goodwill
Value to distribution
30 561
29 573
30 561
90 695
7 293
0
7 293
Customer contracts
Deferred tax on unrealized gains
Net identifiable in realized gains
24 500
6 100
18 400
Goodwill
65 002
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Fivestarday AB
Link Mobility AB acquired all shares in Fivestarday 18 May 2015. The purchasing price was set to MSEK 4,2
Acquisition analysis
100% of the shares Fivestarday
Purchase price
Book value of equity
Book value of existing goodwill
Value to distribution
Customer contracts
Deferred tax on unrealized gains
Net identifiable in realized gains
Goodwill
4 007
131
0
3 876
0
0
0
3 876
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Declaration on the financial statements
We confirm that the financial statements for second quarter 2015, to the best of our knowledge, have been
prepared in accordance with International Financial Reporting Standards (IFRS), gives a true and fair view of
the company’s and group’s consolidated assets, liabilities, financial position and results of operations, and that
the annual report includes a fair review of the development, results and position of the company and group,
together with a description of the most central risks and uncertainty factors facing the companies.
Oslo, 17.08.2015
The Board of Link Mobility Group ASA
Jens Rugseth
Chairman of the board
Gisela Sogn
Board Member
Rune Syversen
Board Member
Guro Røed
Board Member
Tove Giske
Board Member
Harald Dahl
Board Member
Johan Andersen
CEO
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Link Mobility Group ASA
Rosenkrantz' gate 9
0159 Oslo
Contact information:
CFO Siw Ødegaard
[email protected]
Mob: +47 95 75 98 48
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