CEO Update and summary of 2020

The year of 2020 will go down in history as the year when the world was turned upside down. A year of pandemic, chaos, confusion, turmoil and a new way of looking at the world. But the very same year has also meant new opportunities being opened, arising of new alliances and irrevocable decisions of change. Change that gives a company like ours a clear advantage. We are on the frontline, taking our partners and customers through the change that is transforming them into data driven and digitized organizations ready for the future. And this year we will have, among others, our dream partner with us - the largest Business Data provider in Europe.

The past year we have taken the opportunity to execute on our communicated goal of connecting relevant companies to us through acquisitions to expand and sharpen our core business. We have also been able to reach several goals including substantially increasing users in Prism, enhance the user experience in the platform and make adaptation to several industries we have seen as relevant for our growth. Bank & Finance and the Energy are two good examples of those.

In the acquisition journey we have found companies with really high potential to the group. Qbim is one such example. On the surface, a conventional IT consulting company, but there is much more than first meets the eye. From Qbim we expect to be able to grow in the public sector, to take a lead in AI and Analytics Reporting, and additionally we have an idea of carving out Trafikportalen to give the solution the right conditions to grow and take market shares. The solution can in fact compete with and outmatch the largest solutions in the world, such as Swiftly from the US. We know it can, because we have done our homework.

Cloud Explorers has already proven to be a success story. We acquired our associated company with the conviction and goal that we would get a partnership agreement with Bisnode. With hard work and a flawless strategy, we finally did. What will this mean to us? Well, I have been very clear of the significance of the deal. Prism is in a position to support the Business Data giant to transform into the next phase where digitization and automation are the lead in the business model. Prism is providing them with exactly that. Prism can help them change the infrastructure of their business model and create an added value to their clients. They will be using Prism internally but also act a reseller of the platform. What it means in figures the coming quarterly reports will show.

How about Eniro? Well, having the opportunity and the mandate to make the deal of the decade for SpectrumOne is nothing less than a great honor for me. Frankly, I thought this would be a deal we could only do much later next year. But having worked together with my dedicated team during the Christmas holiday we managed to pull this deal through much earlier and way more efficiently than planned to.

Ever since I started looking closer at Eniro, after first identifying some initial synergies, we have found the deal is clearly becoming better and more logical than we first had recognized. The third quarter of Eniro validated they had reached several of the targets set up for the company. The quarterly report showed two great things;

• Eniro is now a financially well-balanced company, they have solved the great debt they had through an issuing of share to pay off their lenders.
• Eniro is increasing profitability to a competitive level.

Eniro, once being the largest telephone directory in the Nordics, has an ambitious plan of transforming to a SaaS-company. In order to do so, mainly three criteria must be in place;

1. Recurring revenue most be the sole or main revenue stream
2. Digitized customer acquisition
3. Self-service and online customer service

Additional metrics to look at when transforming into a SaaS Company are Customer Acquisitions Cost, Customer Retention Rate and Lead-to-Customer Conversion Rate and Growth Monthly Recurring Revenue Rate etc. all of which can be supported by a great analytics tool, thus Prism.

Eniro have one of the largest Small Medium Enterprises (SME) client portfolios in the Nordics. As of today, Eniro have 60,000 clients within this segment but the potential accessible market however is astonishing 1,200,000 clients. Hence, every development and enhancement of the organisation will potentially have an exponential return of investment. Eventually, being able to do so with our team and our platform of Prism will be the truly gamechanger for Eniro. And a tremendous impact for SpectrumOne.

Prism is the key for all of the above. Prism can be used to utilize existing SMB customer base through additional sales (upselling + cross-selling) of digital marketing services without losing existing revenue.  Focus will be on automated products and services that require little human resources. The organization will need to reorganize towards delivering digital services with a focus on standardization, automation and simplicity. The very core of the Prism software.

Combining Eniro, a leading actor within information and online traffic, with a leading analytics software will create an inexhaustible source of revenues for both companies and take a higher position in the value chain. Our shareholders will through this setup be able to benefit from both.

Additionally, as Eniro is an associated company, we will be able to count a pro rata part (28%) of the result at Eniro in our reports every quarter. Adjusted EBITDA for Eniro in the last quarter was SEK 42 Million.

Our course of action for the financing has been through a right issue where we will raise the capital needed to complete the payment. Another alternative was a scenario where we could have lent the money or made a directed right issue. However, my assessment, having the benefits of our shareholders in mind, is that this alternative gives us the best of both worlds. The rights issue is almost fully guaranteed, but my shareholders have the opportunity to participate on the same conditions as every guarantor. The financing is secured, and no one is disadvantaged.

Last year some other significant events took place in our company.

The trademark protection for SpectrumOne was approved by the European Union Intellectual Property Office. This means no one within the industry can longer intrude on our brand and use it unless permitted by us. This also gives our partners a secure brand to work with.

Anders Hugosson, former CEO of UC, joined the board as a member the latter half of the year and has already contributed with his experience from the Data Business. Anders Hugosson will be a very relevant part for us truly capitalizing on our newly gained partners and partners to come.

Regarding our finances. Our warrants of TO2 were executed in the fourth quarter and contributed with Million 65 SEK to the companies financing. Some of the capital was used for paying off the debt for the acquisition of Cloud Explorers. Additionally, almost 95% of our convertible loan was converted, contributing to us having almost entirely eliminated our long-term debts in the company. Clearly becoming stronger and decreasing the risk for our shareholders.

2021 is a year we have all been waiting for. Provided that we would reach our goals in 2020 we were convinced that 2021 would be our year. Having exceeded those expectations our shareholders can expect a year with higher growth, international expansion, additional partners to the Prism platform and further interesting events changing and evolving the company of SpectrumOne becoming the best Martech company in Europe.

For further information contact:

Hosni Teque-Omeirat
CEO

+46 70 225 18 77 
hosni@spectrumone.com

Certified Adviser:
Mangold Fondkommission AB (556585-1267) 
Box 55 691 102 15 Stockholm 
Telefon: +46 8 503 015 50 
ca@mangold.se 
www.mangold.se

SpectrumOne is a leading technology company delivering an advanced Data Management, Analytics & Communications platform suite. Offered in a SaaS online service shipping with rich market data from various professional providers, SpectrumOne provides a unique solution to many leading actors across industry segments in various countries. Enabling clients with fast and easy access to data insight and visualization coupled with powerful search, segmentation, and mapping features. SpectrumOne allows data to be quickly enabled and operationalized, driving activities from customer communication to data science supporting business analysis, strategy, and growth. All of which can be enabled the same day with immediate results. SpectrumOne´s headquarter is based in Stockholm, Sweden, responsible for Nordic sales and strategy, with additional sales and business development located in Oslo, Norway.  SpectrumOne is listed on Nasdaq First North Growth Market in Stockholm. www.spectrumone.com