Interim report Q3, 2020

Third quarter 2020

• Net sales amounted to MSEK 4.3 (2.5)
• EBITDA amounted to MSEK -1.6 (-5.6)
• EBT amounted to MSEK -10.1 (-10.7)
• Earnings per share before dilutions amounted to SEK  -0.05 (-0.08)
• SpectrumOne’s rights issue of free-of-payment units is oversubscribed
• SpectrumOne acquires the digital marketing agency The Trigger Company AB
• SpectrumOne has closed acquisition of Å-Data Infosystems AB

Significant events after the reporting period

• Extraordinary General Meeting elected Anders Hugosson as a new member of the Board and gave mandate to the Board to issue new shares, convertible and/or warrants.

CEO statement

Our sales strategy is becoming a winning game

Having experienced and still undergoing one of the worst economic downturns in recent history, our sales strategy is now more than ever really being put to the test. Our sales strategy is founded on the firm belief that we are creating greater value with our offerings than competing solutions on the market. We have solid evidence now from our clients, that Prism as a data manager along with powerful insight-providing capacities, delivers great gain for every organization analyzing and working with large amounts of data. I believe the data-driven organization to be the future for every enterprise. We witness now in practically every case, that our most significant competitors are not other Data Analytics solution providers, but in fact the non-analytic approach, decision makers without any pre-set criteria. A still very widely accepted methodology but very far from the highly insightful and cutting-edge innovative platform of Prism.

The revenue figures of the quarters represent the low activity months of July and August very much. A disappointment from some points of view but the future strongly strengthens my confidence. And though our subsidiary of BizWell is still a huge strain to our numbers I am pleased that Prism keeps attracting clients in larger numbers and sizes. More importantly, our main criteria’s such as usage time, screen time for users, integration possibilities and value added to business are on the rise.  Our core is more valuable than ever before. And our core is where the high margins are found resulting in maintaining the overall  margins over 60% despite the burdening results from BizWell.

What about Data
Data storytelling has been exclusively focused on analytics, telling stories with data insights. What we are doing is expanding the definition of data storytelling to include data management, we want to enable our customers to tell their stories with accurate, concurrent and concise data. Scott Taylor, the “Data Whisperer”, said “if your data management story isn’t any good, then your analytics data story will be a tragedy”. Hence, data and analytics need to be much more strongly linked. It´s clear that the industry is moving in the direction of more integration points between information production and analytic consumption. This area is one of the powerful and key strengths of Prism, the very same sweet spot we identified several years ago when we started developing Prism accordingly.

Our partners´ response
This is also what our current and partners to be experience and agree upon. During these challenging times we have been able to acquire and sign several new clients thanks to our developing partnership with a large international actor within business data. One such new client, which now our single largest instance, with 10 departments with over 50 users operating the platform daily. Such a partnership has made it possible for us to sign the majority actors in the utility market in Norway, in a short space of time we believe we will have the entire market in one specific industry. An extremely good indication that solutions that satisfy the needs of a particular segment can quickly be scaled to similar actors in the same market.

Our Partners have challenged us, developed us, worked together with us, elevating our professionalism and enriched our offering, opened doors for us and made us their key software supplier and close partner for their clients to use for analyzing their data. Because we share the same vision - to transforms and develop the business data industry into the next generation of industry.

Prism is key and makes a difference
Having proved the gain with the platform and received multiple customer testimonials, far exceeding both our own and our partners expectations, the path for signing profitable and long-term partnership is clear. Not just in the local Norwegian market but on a broader international level. Signing a full long-term wider partnership with our largest partner is on top of our agenda. We had hoped we would be able to communicate more details during the third quarter but sometimes things take longer time due to circumstances I cannot influence. However a partnership built on strong foundations of demonstratable client onboard and success, I believe, is a preferable and more fundamental approach. I am fully comfortable saying that a full long-term partnership agreement will be concluded during the final quarter. It will in an instance change the course of this company, as an analyst chose to express himself a couple of weeks ago.

Our success so far

The acquisition of The Trigger Company
I am thrilled that since last quarterly report we have acquired another two companies related to our offerings within Prism. The Trigger Company, a digital marketing agency was acquired by us this quarter. Trigger have built a team and a company culture with a strong client focus, very similar to what we are doing in SpectrumOne. The similarities will ensure a speedy implementation, the complementary synergies will make both of companies stronger. Even though the pandemic and the economic recession have hit the company hard I foresee a great potential for Trigger to be executed on within the family of the SpectrumOne group. The Trigger Company is connecting to yet another part of the value chain with our clients. As mentioned earlier, SpectrumOne has ambitious plans to escalate business and expand into the European continent. While offering an easy SaaS service shipping with rich market data from various professional providers we haven’t so far had any execution power to lead our clients in their digitization journey, this is where Trigger will be connected to our offering forming a very key aspect and set of capabilities.

The acquisition of Å-data
Å-data is yet another great acquisition we have been able to close during the third quarter. For many years Qbim have optimized, enhanced and further developed others´ systems. A development that have led to huge successes for others. With SpectrumOne we have taken Qbim to yet another level of development and visualization. These synergies we will now use to further create more value, more smartness and a tremendous simplicity with Å-data. Having shown great skills in developing and commercializing a product within their enterprise planning platform, I foresee a big potential in Å-data. Qbim is also aiming at increasing their stake in the public business, a business where Å-data is a strong and reliant partner and where simplicity and digitization is an increasing demand from the market. With the support of SpectrumOne and Qbim, Å-data gets the opportunity to develop into a vendor of the 21st century and SpectrumOne will be able to increase the penetration level into the public sector.

New customers
Current and developing partners has supported us in signing new clients within various branches. As mentioned above, one such new client is one with 10 departments with over 50 users operating the platform daily - a hugely important KPI. Our partnerships have made it possible to sign the majority actors in the utility market in Norway - and aiming at taking the entire market! This achievement is to be scaled to other markets as well.

Trademark protection approved
SpectrumOne has been granted trademark protection in the EU from European Union Intellectual Property Office. SpectrumOne no longer has any obstacles to investing, expanding and partnering with partners within the EU. We got the protection in the two classes we applied for, class 42 which is IT services and class 35 which is Marketing, Consumer Information and Business Assistance. A protection that shows our sincere dedication to fulfill any possible requirements from partners to come.

New board member
As a response to our growth, increase in our assets and need to operate strategically at an international level, I am pleased that Anders Hugosson, former CEO of UC, is nominated and chosen as new board member confirmed at the extraordinary general meeting. Having pinpointed the business data industry as one of the most interesting businesses for Prism to really make a difference, it is an invaluable asset for us to have Hugosson in our board. I have been determined to have him with us, so I was very excited when he joined us. For me, Hugosson has chosen us, rather than us choosing him. A great success for us, a rather small company, to have such a senior and experienced individual joining the team. His contribution, I am certain, will be tremendous both in the very short and long term.

Additional success to come soon

Divestment of Asset in Qbim
Previously I have talked about the huge opportunity found in Qbims portfolio. Today I want to reveal that the revolutionary platform we found and have further developed is Trafikportalen. Trafikportalen is the latest addition to the SaaS service portfolio and is aimed at both the public transport companies and the general public. By collecting data on the vehicles' position, lines and stops, a real-time map is delivered for each region's public transport, both for buses and trains. A truly groundbreaking tool that many transportation companies have been looking for and that has the potential of becoming the world leading platform for such services. Global dominants in the market such as Swiftly, with far less advanced offerings, are requesting up to 3 MSEK in annual fees, we are convinced we can charge 1,5-2 MSEK in an annual retainer.

A great tool, but not in line with our core business of Business Intelligence and Analytics makes the decision of divesting the software as a bundled corporation clearly reasonable. Since purchasing Qbim we have continued developing the platform in order to make it not only attractive to our clients but also packaged and incorporated ready for divestment. This is an opportunity we are still working on and the different ways to divest the business are evaluated. I will make sure the divestment of that tool will directly benefit our shareholders.

International acquisition
As stated in earlier communications we have a clear expansion plan internationally. This has led us to evaluate the European market for the right acquisition to merge with our existing international operations. We are currently looking at companies in UK specifically. UK holds the single largest Martech market in Europe and is growing rapidly. The uncertainty regarding the Brexit discussions has made it possible for us to enter the market to a much lower cost than expected despite the fact that the opportunities to do business in the UK have not by any means diminished.

Stockholm, November 2020

Hosni Teque-Omeirat

CEO
 

This report is to be found on our webpage (https://spectrumone.com/investor/reports-and-presentations/)
 

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 AB (publ) is obligated to publish this information under the EU Market Abuse Regulation. The information was provided by the above contact person's auspices, for publication on November 5, 2020 at 08.00 a.m. CET.

About SpectrumOne AB

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