Solteq Oyj - Inside information

Solteq acquires inPulse Works Oy, expands to the utilities sector and strengthens its BI and analytics expertise

Solteq Plc Stock Exchange Bulletin 12.6.2017 at 10.00 am

Solteq Plc has acquired inPulse Works Oy. The acquisition will enable Solteq to
offer services that meet the varying needs of electricity, district heating and
water companies. The acquisition will also strengthen Solteq's current BI and
analytics expertise and open new opportunities in the sector-independent BI and
analytics market. inPulse Works Oy’s products and services digitalise customer
engagement and business processes. The company offers its clients digital
services related to the customer interface, invoicing and customer data systems,
electricity sales management systems, and BI and analytics solutions.

The acquisition is in line with the strategy revision that Solteq announced in
its first interim report for 2017. In accordance with its strategy, Solteq will
expand its operations to sectors in which digital disruption is shaking the
foundations.

Two growth-oriented companies find each other

inPulse Works Oy’s business relies on two cornerstones. On the one hand, the
company operates in the utilities sector with focus on customer experience and
digitalisation of business processes with its own service and product solutions
and customer-specific implementations. The second cornerstone is BI and
analytics solutions, which are sector-independent. The implementations are based
on Microsoft products and solutions.

– Many aspects in Solteq’s and inPulse’s operations and offerings fell perfectly
into place. In our first interim report, we stated that, in addition to
commerce, we would also expand our presence in other sectors that are being
shaken by digital disruption. The utilities sector is a good example. As is
widely known, the utilities sector is undergoing rapid digitalisation, and
recovery of data becomes crucial for the industry. In this game, we have plenty
of opportunities to take with our clients, Solteq’s CEO Olli Väätäinen states.

– We also realised that our areas of expertise complement each other. Earlier
this year, we strengthened our analytics offering by acquiring a majority
holding of Analyteq Oy, a company specialising in inventory replenishment and
analytics services. inPulse’s BI and analytics know-how will naturally add our
analytics expertise. As demand for analytics services has exceeded our
expectations, this addition is most welcome. Besides, we also have a strong
Microsoft background, Olli Väätäinen continues.

– inPulse has always been an innovatively forward-looking, growth-oriented
company. This merger will allow us to be part of the growth story of a larger
company in a sector that is new to it and to add to client stories with our BI
and analytics expertise. We will also be able to serve our clients better
through the new total offering. Our contribution to Solteq is new kind of
expertise, but the merger will also offer our personnel growth paths to roles
that a large company can offer, inPulse Works Oy’s CEO Juha Rokkanen says.

inPulse Works Oy’s specialist organisation of 60 experts operates nationwide
with offices in Jyväskylä, Kuopio and Seinäjoki.

Purchase price, payment and financing

The debt-free purchase price of inPulse Oy’s shares is 3.5 million euro. Based
on the authorisation granted to the Board of Directors by the Annual General
Meeting on 17 March 2017, 1.0 million euro of the purchase price of the shares
will be paid with Solteq’s new shares and the remainder with existing cash
assets. The subscription price of the shares is 1.63 euro per share, determined
on the basis of the volume-weighted average price of the share during the period
of 1 May to 31 May 2017. A total of 613 thousand new shares will be issued to
pay the purchase price. The number of shares in the issue represents about 3.3%
of the number of shares after the share issue.

inPulse Works is consolidated to Solteq Group as from 1 June as a fully owned
subsidiary.

inPulse Works Oy’s key figures

The below table shows company's audited financial statement information (FAS)
for financial periods 1 January - 31 December 2015 and 1 January - 31 December
2016 (thousand euro):

Income Statement (FAS):                 (thousand euro)

                                        1.1.-31.12.2016  1.1.-31.12.2015
Revenue                                           4 898            4 132
Other income                                         56               32
Materials and services                             -203             -132
Employee benefit expenses                        -3 654           -3 105
Depreciation and impairments                       -108              -92
Other expenses                                     -774             -788
Operating result                                    215               47
Financial income and expenses                        -6               -6
Profit before taxes                                 209               41
Income tax expenses                                 -42               -8
Profit for the financial period                     167               33

Balance Sheet (FAS):
                                             31.12.2016       31.12.2015
Assets
Non-current assets
Intangible assets                                   269              285
Machinery and equipment                              12               16
Total non-current assets                            281              301
Current assets
Trade receivables                                   961              716
Other receivables                                    76               78
Cash and cash equivalents                           251              408
Total current assets                              1 288            1 202

Total assets                                      1 569            1 503

Equity and liabilities
Total equity                                        316              312
Loans from financial institutions                   274              274
Trade payables                                       70               33
Other non-interest bearing liabilities              909              884
Total liabilities                                 1 253            1 191

Total equity and liabilities                      1 569            1 503

New shares

In order to implement the acquisition of inPulse Works Oy, Solteq’s
shareholders' subscription rights will be excluded in the issue of new shares,
and the shares will be directed to inPulse Works Oy’s current shareholders. The
subscribers will be entitled to exercise shareholder rights in the company after
the shares have been registered in the Trade Register. The shares will be added
to the book-entry system maintained by Euroclear Finland Ltd. Solteq will apply
for the shares subscribed for in the share issue to be admitted to public
trading on NASDAQ OMX Helsinki Stock Exchange.

Profit guidance

Solteq maintains its profit guidance: the Group’s adjusted operating profit is
expected to grow from the 2016 level.

Further Information

Olli Väätäinen, CEO, Solteq Plc
Tel. +358 50 5578 111
olli.vaatainen@solteq.com

Juha Rokkanen, CEO, inPulse Works Oy
Tel. +358 400 560 977
juha.rokkanen@inpulse.fi

Distribution

NASDAQ OMX Helsinki
Key Media
www.solteq.com

Solteq in Brief

Solteq is a Nordic IT provider and software house that specialises in digital
customer engagement. We offer total solutions for both business enhancement by
means of digitalisation and for omnicommerce: from back end processes all the
way to the customer’s purchasing experience and from supply chain management to
digital marketing. Our 450 experts, who work in three countries, develop and
implement solutions for clients in Europe, North America, Asia and Australia. In
2016, Solteq’s net sales amounted to 63 million euro.

inPulse Works in Brief

inPulse Works Oy is a steadily growing expert and software company that provides
eService and IT solutions. It was established in 2010, and it is owned by the
operative personnel. The company operates nationwide with offices in Jyväskylä,
Kuopio and Seinäjoki. In 2016, inPulse’s net sales amounted to about 5 million
euro.