Solteq Oyj - Interim report (Q1 and Q3)

SOLTEQ PLC INTERIM REPORT 1.1. - 30.6.2016

Solteq Plc Stock Exchange Bulletin 15.7.2016 at 8.00 am

Revenue and operating profit developed as expected, focusing on omnichannel and
digital commerce continues

Brief look at January – June 2016

- Revenue totalled 31,8 million euros (19,0 million euros)

- Operating profit was 5,735 thousand euros (1,119 thousand euros). The impact
of the business divested in the first quarter on the operating result was –212
thousand euros.

- Adjusted operating profit was 1.606 thousand euros (1,119 thousand euros). The
nonrecurring income and costs related to the divestment of MainIoT Software Ltd
totalled +4,129 thousand euros.

- Solteq Group’s equity ratio was 32,4 % (52,0 %).

- Earnings per share was 0,29 euros (0,06 euros)

- In the review period, Solteq published the new strategy, in which the key
elements are digital commerce, growth and internationalisation.

- As a part of the strategic focusing on the omnichannel and digital commerce
solutions, the company decided to sell the entire share capital of MainIoT
Software Ltd that provides software solutions for maintenance and services
management.

- Solteq initiated an efficiency programme to improve the profitability in a few
business areas

Key figures and ratios

+---------------------+-----+-----+--------+----------+----------+--------+
|                     |4-6 /|4-6 /|Change-%|1-6 / 2016|1-6 / 2015|Change-%|
|                     | 2016| 2015|        |          |          |        |
+---------------------+-----+-----+--------+----------+----------+--------+
|Revenue, EUR million | 16,4|  9,8|  67,0 %|      31,8|      19,0|  67,6 %|
+---------------------+-----+-----+--------+----------+----------+--------+
|Adjusted operating   |  0,9|  0,7|  33,4 %|       1,6|       1,1|  43,5 %|
|profit, EUR million  |     |     |        |          |          |        |
+---------------------+-----+-----+--------+----------+----------+--------+
|Operating profit, EUR|  0,8|  0,7|  24,6 %|       5,7|       1,1| 412,5 %|
|million              |     |     |        |          |          |        |
+---------------------+-----+-----+--------+----------+----------+--------+
|Profit for the       |  0,5|  0,5|  -9,5 %|       4,9|       0,9| 453,8 %|
|financial period, EUR|     |     |        |          |          |        |
|million              |     |     |        |          |          |        |
+---------------------+-----+-----+--------+----------+----------+--------+
|Earnings/share, eur  | 0,02| 0,04| -50,0 %|      0,29|      0,06| 379,4 %|
+---------------------+-----+-----+--------+----------+----------+--------+
|Operating profit -%  |5,0 %|6,7 %| -25,3 %|    18,0 %|     5,9 %| 205,1 %|
+---------------------+-----+-----+--------+----------+----------+--------+
|Equity ratio, %      | 32,4| 52,0| -37,8 %|    32,4 %|    52,0 %| -37,8 %|
|                     |    %|    %|        |          |          |        |
+---------------------+-----+-----+--------+----------+----------+--------+



Repe Harmanen, CEO of Solteq: New strategy, focus on digital commerce and
improved profitability

We are an expert in digital commerce. We offer comprehensive solutions for
multichannel and digital commerce: backend processes all the way to customer
experience – from supply chain management to digital marketing. This is the
core, the mission and the goal of our business operations.

Our performance in the past quarter and the first half year was mainly positive
and met our expectations. The most positive development in terms of the revenue
and operating profit was seen in the key strategic areas. At the same time, we
had a few business units in which the improvement of profitability required
special measures. Improvements were started in the first quarter, and results
will be seen towards the end of the year.

An example of the strength of our strategy is the framework agreement with the
Musti ja Mirri Group Oy on the delivery of a retail business solution to the
Finnish, Swedish and Norwegian markets that we published at the beginning of
July. During the latter part of the year, we will strengthen the part of our
operations that is related to digital commerce.

The key elements of our strategy are digital commerce, growth and
internationalisation. In the Nordic countries, we will focus on solutions for
retail chains and digital commerce. Globally, digital commerce solutions is in
the core of our strategy. In Finland, we will mainly grow organically, but in
the Nordic countries and globally, we also aim at being active in mergers and
acquisitions to implement our strategy. Strategic action plans to improve growth
and profitability are being implemented to ensure that we will stay ahead our
competitors.

The positive development of our main financial key figures has continued, which
means that we are well prepared for implementing our strategic measures. We will
estimate the competitiveness of our solution offering in the Nordic market to
allow us to strengthen our main strategic areas if necessary. At the same time,
we believe that focusing on certain solutions will enhance our operations.

The excellent contribution of our experts has taken us huge steps forward, and I
am pleased with our achievements in this respect. The feedback that we have
received on our recent development and strategy outlines has been extremely
promising from our experts and. The structural change that we are implementing
is clearly the right way to grow and develop in view of the drastic changes
taking place in the digital world.

We will maintain our earlier profit guidance concerning the revenue and
operating profit for 2016.

We wish all our stakeholders an excellent summer season!

Guidance on Group outlook

Solteq Group’s revenue is expected to grow significantly compared to financial
year 2015. The operating profit and the adjusted operating profit are expected
to grow compared to financial year 2015 as well.

The expected growth of revenue and operating profit is mainly related to the M&A
activity completed during the previous financial year and during the review
period. In addition, the cost synergies arising from the M&A activity are
expected to be realized mainly during the year 2016.

Briefing for investors and media

The media and investor briefing for the announcement of financial performance of
the first half of 2016 will be broadcasted on Periscope July 15th, 2016 at 13.00
on channel @SolteqTweets.

The briefing will be recorded and can be accessed on the Solteq’s website later
on the same day.

Further information

Repe Harmanen, CEO
tel. +358 400 467 717
e-mail repe.harmanen@solteq.com

Antti Kärkkäinen, CFO
tel. +358 40 8444 393
e-mail antti.karkkainen@solteq.com

DISTRIBUTION
NASDAQ OMX Helsinki
Key media
www.solteq.com

Solteq in brief

Solteq is an expert in digital commerce. We deliver comprehensive solutions for
digital commerce under one roof: from back-office processes to customer
experience ­­– from supply chain management to online marketing. We have the
passion to deliver the unexpected – in a fast-changing world our customers need
a partner who can deliver today what they need tomorrow. We employ ca. 500
experts in three different countries and we make deliveries to Europe, North
America, Asia and Australia.

Attachments:

07147055.pdf