esoft systems CVR-nr FIRST NORTH ANNOUNCEMENT NO PLEASE READ THE DANISH VERSION FOR LEGALLY BINDING INFORMATION.

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1 esoft systems FINANCIAL STATEMENT 2015 for the period from January 1st 2015 to December 31st 2015 THIS IS A TRANSLATED VERSION OF THE ORIGINAL FIRST NORTH MESSAGE PUBLISHED TO THE STOCK MARKET. PLEASE READ THE DANISH VERSION FOR LEGALLY BINDING INFORMATION. CVR-nr

2 2 The group s core business The development in activities and economy Expectations for the future Risk conditions Events occurred after the end of the financial year Key figures REPORT The group s core business The group consists of the following companies: esoft systems a/s (IPR), esoft a/s (Danish operator), 3D Plan ApS (no activities), esoft systems ab Sweden, esoftflow ltd Vietnam, esoft creative solutions S.L. Spain and esoft systems Inc USA (no activities). The group has furthermore associated interests in Vidibili FYN aps and Vidibili DK aps, who produces commercial films in shared ownership with Sydfynske Medier. The group primarily focuses on sales of IT platforms and real estate visualisation solutions to real estate agents and photographers. The group, furthermore, offers a full service concept based on an IT platform capable of handling photography, film and text production for marketing and related areas. Apart from the group s sales of IT platforms and visualization solutions, the subsidiary esoft creative solutions S.L provides video editing services. The company is based in Barcelona. It offers a strong strategic opportunity to sell video and film products combining Danish and local video editors to ensure the correct handling of the Nordic languages and at the same time being scalable to other parts of the world. Due to Youtube and general Google search optimization there is an increasing demand for video products from the customers. The group sees new possibilities in content marketing. The increasing number of copywriters and journalists at the Barcelona subsidiary makes it possible to deliver quality copy writing with a distinct local touch independent of city, country and location. This can develop into becoming an important competitive advantage for both the group and the group s customers. In 2015, the group expected to deliver more than real estate texts from the copywriters in Barcelona. The group managed to deliver approximately real estate texts. This figure is expected to increase even more in The development in activities and economy Turnover Between 2014 and 2015 the turnover of the group has increased from DKK 91,8 million to DKK 105,7 million which is considered very satisfactory. The 15% increase is characterized by progress on existing and new markets in a broad sense. There has been progress on the group s primary markets. This combined with new customers has resulted in a considerable increase in turnover. The increase in sales of the group is caused primarily by additions to the packages for existing customers and new customers joining. Esoftflow continues to have a satisfactory growth. In 2015, the sales of real estate texts including interview with the seller and location research, have contributed to the growth in esoft creative solutions S.L. This business area is also undergoing considerable development.

3 3 Annual result The annual result before taxes amounts to DKK 3,1 million and is viewed as satisfactory. This in the light of the investments and the considerable expenses related to the strategic activities in Solid investments will also need to be made in 2016 where the goal is to finalise the financial year with a positive result. Investment projects should be finalised and implemented in the market. During 2015, noticeable resources have been applied in relation to the go live of a new IT platform. The platform was launched in Sweden on January 2nd 2015 and a relative restructuring followed. The Swedish organisation is now in place and ready for continuous growth in the years to come. Similarly, the Danish operator went live on the new IT platform on June 1st 2015, with considerable investments being made in the process and adjustments to the Danish organisation initiated. Finally, the Spanish subsidiary went live on the new IT platform on June 1st 2015, and the related adjustments have also led to increased expenses during the year. The annual result is first and foremost related to the overstaffing linked to the go live of the new IT platform. This is expected to be normalised and optimised in 2016, where stabilisation, adjustments and improvements will be part of the everyday life in the years to come. The subsidiary in Vietnam has experienced a satisfactory growth in The number of employees continues to increase and as a result the company has reserved new offices. The strengthening of the USD exhange rate influences the exchange rate with unrealised loss. Futures contracts are not being established. The subsidiary in USA has not been operating in the financial year The customers are still being serviced directly from esoftflow. The group employed an average of 516 employees in 2015 compared to 389 the year before. Equity The equity capital has increased to DKK 20,9 million in 2015 equivalent to a solvency of 65,2%. The equity capital in 2014 was 16,7 million equivalent to a solvency of 58,8%. Expectation for the future In the years to follow, the group expects major changes in the market, nationally as well as internationally. These changes are to a wide extent driven by IT and opportunities that surface online. We expect that the groups continued investments in IT, new products, and enhanced efficiency in the collaboration between buyer, seller and agent, will contribute to consolidate our strong position in Scandinavia. It is furthermore expected that these changes will offer new opportunities for the group to expand both geographically and product wise. These opportunities will be explored by seeking relevant strategic partnerships domestically and abroad, where it makes sense. For the financial year 2016 the company expects to keep its market position whilst also expanding the product portfolio with new products in Denmark. On the Swedish market, sales expansion is expected as a result of an intensified sales effort. Vietnam is equally expected to increase its turnover in the following year. esoft creative solutions S.L. in Barcelona is also expecting growth as interest in the products has been shown from many sides is a year where the company will need to adjust to new workflows related to the new IT platform. New roles and responsibilities will be part of daily life until optimization has full effect. The new IT platform offers a considerable scalability. This development is seen as very satisfactory. On a group level it has been decided to continue to invest in optimisation of the IT platform and development and implementation of new products in Our close collaborators in Norway for 6 years ensure the sales of our products in Norway. We expect to further expand this strategic collaboration in the years to come by means of selling more of the group s products on the Norwegian market. In the beginning of 2016, a new CEO and management team have joined esoft a/s to strengthen the operational focus on the Danish activities. Group CEO René Dines Hermand continues to have his primary focus on the business development and the support to the country managers.

4 4 Risk conditions Currency risks Activities abroad cause the result, cashflows and equity capital to be influenced by the fluctuations in the exchange rate between DKK, SEK and USD. Hedging will not be made. Interest risks As the net interest-bearing debt does not amount to a significant sum, moderate changes to the interest level will not have significant affect on the earnings. For the same reason, no hedging is made regarding interest. Events occurred after the end of the financial year No events have occurred after the financial year that could influence the evaluation of the company s financial position.

5 5 Key figures TDKK Figures for the period Revenue EBIT Financial income/expense EBT Total assets Equity Cash flow Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Total cash flow Cash and cash equivalents beginning Cash and cash equivalents end Equity Equity beginning Result for the period Adjustments Dividends 0 0 Equity end Key figures Number of shares Result before tax per share 0,88 0,83 Book value of equity per share 5,95 4,77 Market price per share December 31st 29,00 20,00 Market value (1.000 DKK) * Not revised figures Cash and cash equivalents can be specified as follows: Cash and cash equivalents Operating credit facilities 0 0

6 6 The board of directors The esoft systems board of directors is composed of: Torben Frigaard Rasmussen (chairman of the board) Michael Vinther René Dines Board decisions Except from the messages already communicated through First North, no fundamental decisions have been taken during the period in question. The company s shareholdings esoft systems a/s holds no shares in the company The board and the management - direct and indirect shareholdings CEO René Dines Hermand: shares. The company had an average of 250 shareholders in the period in question. The Certified Adviser and the Adviser s employees - direct and indirect shareholdings The Certified Adviser holds no shares in the company Next trading update Next trading update will be published on May 5th, 2016 General meeting April 8th, 2016 Further information Please contact - CEO René Dines Hermand, tel: Torben Frigaard Rasmussen (chairman of the board) Mobil Company address Esoft systems a/s Skibhusvej 52C 5000 Odense C Denmark Certified Adviser: Martin Niclasen Ernst & Young P/S Osvald Helmuths Vej 4, 2000 Frederiksberg Denmark About esoft systems a/s: esoft systems a/s develops innovative solutions for the real estate sector and others with need for high volume image editing and production of visual presentations. Our partners around the globe include individual real estate chains and companies that handle photography for real estate companies. We also service other companies that benefit from our ability to deliver large numbers of commercial photos and presentations. We continually invent new products to give our partners a competitive edge and we are always exploring new ways to enhance our existing products. esoft systems currently employ more than 500 people and we are continuously growing. Read more at

7 esoft systems Skibhusvej 52C DK-5000 Odense C Phone: info@esoftsystems.com