Pomegranate Investment AB (publ) Releases Financial Report for the Fourth Quarter 2017 and the Period January 1, 2017–December 31, 2017.

NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO ANY U.S. PERSON

Pomegranate Investment AB (publ) (“Pomegranate” or “the Company”) is pleased to report on a number of recent investments and significant developments among its portfolio companies in the last quarter of 2017. Pomegranate continues to invest in some of Iran’s most exciting growth companies which are driving economic growth and knowledge transfer in their sectors.

Highlights of the reporting period

  • Net result for the quarter was EUR -3.7 million (EUR 35.4 mln).
     
  • Net result for the period was EUR -3.8 million (mln) (January 1, 2016–December 31, 2016: EUR 35.2 mln). Earnings per share were EUR -0.7 (9.8).
     
  • The net asset value of the Company was EUR 156.8 mln on December 31, 2017, (December 31, 2016: 132.6), corresponding to EUR 29.0 per share, (December 31, 2016: 31.9).
     
  • The Company’s net asset value per share in EUR decreased by 9% over the period January 1, 2017– December 31, 2017.The Company’s net asset value per share in EUR decreased by 2% over the period October 1, 2017– December 31, 2017. The change is mainly foreign exchange related.
     
  • In Q4 2017, Sheypoor successfully closed a funding round of EUR 7 million led by Pomegranate, which invested another EUR 3.7 million, including conversion of the previously extended short-term loan facility of EUR 2.0 million, as well as new cash contribution of EUR 1.7 million which was transferred after the end of the reporting period. Pre-money valuation was EUR 42.3 million. Post transaction, Pomegranate’s shareholding in Sheypoor increased to 44.6% with a post-money valuation of EUR 49.3 million.
  • In November, Pomegranate transferred the second tranche of EUR 0.4 million to Carvanro as part of February 2017 funding agreement.
  • In Q4 2017, Pomegranate concluded the agreement for an investment of EUR 500 thousand into the Iranian fin-tech start-up - Bahamta, active in the field of mobile based peer-to-peer monetary transfers. The investment is payable in two tranches for a total shareholding of 14.3% upon completion. The first tranche was transferred in January 2018.
  • In Q4 2017, Pomegranate increased its indirect see-through economic interest in Café Bazaar group, from 3% to 4.5%, following a fundraising deal in Q4 2017. The deal included EUR 38 million for a 10 per cent increase in shareholding in Café Bazaar group for investors, with a corresponding 1.5% increase in indirect shareholding for Pomegranate.
  • In Q4 2017, the largest online travel business in Iran - Alibaba Travel and Zoraq merged to form the largest Online Travel Agency (“OTA”) in the country. The merged entities will be consolidated under a holding company called “Tusha”.  The valuation of Tusha online travel holding is approximately EUR 82 million after investment of EUR 18.5 million into the holding. Pomegranate will be holding an indirect see-through stake of 3.3% in this business post the merger.
  • The merger between Alibaba Travel and Zoraq was facilitated by Griffon Capital, another of Pomegranate’s portfolio companies, which had exclusive fundraising mandate with the online travel booking site Alibaba.
  • Changes in the values of Pomegranate’s investments in the period October 1, 2017 – December 31, 2017 mainly represent FX-driven downward revision of the Digikala model valuation and hence Sarava value as further explained in the report.
  • Cash and cash equivalents amounted to EUR 35.6 million as per December 31, 2017 (December 31, 2016: 29.0).
     
  • The number of outstanding shares at the end of the period was 5,404,601.

Management Comments

Florian Hellmich, CEO of Pomegranate Investment AB (publ), commented:  

“Q4 2017 was a key period for Pomegranate as we continued to report on a number of investments and significant developments to underpin our presence in Iran’s most exciting tech growth sectors.  To round up the year, we solidified our strategy and increased our exposure to market leadership, directly as well as indirectly, across the E-Commerce, Classified/Mobile, Sharing Economy, Digital Content & Marketing as well as Payment/Financial Services sectors.  2017 saw completion of the team build-out, which is great news. In combination with all the “thousands” of adjustments necessary for a listing, we are in a prime position for 2018 when it comes to capturing the next level of growth and development of the Company.“

For additional information, please visit the Company’s website at www.pomegranateinvestment.com or contact:

Investor Relations contact:

Gustav Wetterling, CFO
Tel: +46 8 545 015 50
Email: ir@pomegranateinvestment.com

About Pomegranate

Pomegranate Investment AB (publ) is based in Sweden and was founded in 2014 by a pioneering team with a long and successful track record of investing in high growth companies in emerging markets, particularly in the technology sector. Pomegranate is an investment company that has a strong position primarily in Iran’s consumer technology sector, which, with the easing of international sanctions, represents an extraordinary growth opportunity for European investors. We are entrepreneurs, we have invested in entrepreneurs and a significant proportion of our investors are entrepreneurs themselves.

This press release does not constitute an offer of any securities of Pomegranate Investment. This press release may not be distributed in the United States or to any “U.S. person”, including any U.S. citizen or permanent resident (‘green card holder’) or any entity organised in the United States, whether located inside or outside the United States. Pomegranate shares represent an investment in Iran that is not suitable for U.S. persons.

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