ANNUAL. January- REPORT. March

Transcription

1 ANNUAL January- REPORT March

2 Zenterio AB (publ) Org Nr Results for 2018 The quarter Deployed license base The VAS (value added services) enabled license base grew by 12 thousand licenses to an accumulated base of 7,2 million. Net sales and other operating income increased by 15,5 % year-on-year to SEK 59,4 million (SEK 51,4 million). EBITDA in the first quarter 2018 was SEK 2,5 million (SEK -9,6 million). Net result in the first quarter 2018 was SEK 10,6 million (SEK -21,1 million). Quarterly Review SEK million Q Q Q Q Q Q Q Q Q Net sales & other operating income 59,4 64,6 51,9 72,4 51,4 57,7 54,2 73,4 56,3 Capitalised R&D 4,9 8,2 8,3 8,9 8,9 10,2 10,4 11,1 10,3 Operating expenses -71,4-70,4-65,6-80,8-80,4-84,3-82,2-88,0-78,3 Operating profit (loss) -7,2 2,5-5,5 0,5-20,1-16,4-17,6-3,6-11,7 Net Financial income (cost) -3,5-3,5-1,9-1,2-1,5-3,3-3,2-5,9-4,3 Profit (loss) before tax -10,7-1,0-7,4-0,7-21,6-20,0-20,9-9,5-16,0

3 Zenterio AB (publ) Org Nr Comments from Jörgen Nilsson, CEO Let me begin this first quarter report 2018 to state that this was a quarter with fantastic improvements of our financial performance versus Q Net sales amounted to SEK 59,4 million, 15,5% higher compared to Q (SEK 51,4 million). Net Sales in the quarter included a write-down in a project in Mexico of SEK 5,0 million. The first quarter EBITDA was positive SEK 2,5 million, improved from SEK -9,6 million in Q Operating expenses improved by SEK 6,1 million whereof SEK 5,9 million related to a reduction in employees in Sweden. More than 7 thousand hours were redistributed from Swedish based consultants to near-shoring. For Zenterio this improvement is important to demonstrate that our client software now is in service with several different propositions and customers globally. Building on the deployment, we have started a dialog with some selected customers to take their client strategy to the next level. This to consider a new architecture bringing proper flexibility and independence with the backend legacy and introduce new solutions and services. If we look back at other key events in the quarter, I need to mention AdScribe, the part of Zenterio that brings next-generation advertising to television viewers and smart analytical SaaS solution. In the quarter the Adscribe offering was ordered to update existing Zenterio installations to get original customer data to enable value added services. The order is indicative of the scalable opportunity that lies ahead of the group. As a concluding comment on this first quarter, I would like to mention that, to scale our business faster, we are driving partnering initiatives with some of the industry s largest vendors to add our client and analytical/advertising solutions to some of their offerings. We expect to outline this in more detail later in the year. In parallel we are looking into what areas we need to add competence and products with relevance for our focus on scalability and recurring revenue. We have built an organization with outstanding competence and a highly flexible and scalable set-up with strong near-shoring partners to provide seamless support as we bring innovation to customers. Being a partner for the long run, Zenterio will continue to bring industry leading solutions to its customers and customers customers as the industry transforms. Adding highly scalable service revenues on top of our installations that we now build out profitably is expected to become a combination of recurring and scalable revenue that we look forward to report on. Finally, I would like to thank all employees, key partners and our key customers for their amazing support for the start of 2018 and look forward to rest of this year. Kind Regards, Jorgen Nilsson, CEO After the first quarter 2018, we are launching our new cloud based product portfolio with an architecture enabling new deployments options to add new services from. We expect this to be very exciting for our existing customers as a license upgrade, as well as for new customer striving to get stronger independence and gain control of their competitive tools.

4 Zenterio AB (publ) Org Nr TV Industry Outlook Disruption continues in the pay-tv industry. Hundreds of OTT TV services, operating via a variety of business models advertising-supported, subscriptiondriven and transactional have been launched around the world. Initially the market was dominated by aggregators of content from multiple sources, but now the content owners themselves are directly entering the market. Their aim is to be able to realise the full value of their programming, to retain direct contact with their customers to mine information on their tastes, and to demonstrate the value of their content for when they negotiate with distributors. Even social media platforms are now offering live video services. Almost everyone who has content or a substantial subscriber base has, or is planning, an OTT offering of some kind. The huge number of OTT services that are now available is becoming a barrier to the take-up of less popular services as managing multiple subscriptions is inconvenient for most users. This is driving a need for aggregation of OTT services in the same way that pay TV operators have traditionally aggregated TV channels for a single monthly fee. Pay TV operators are not the only ones that can do this, but they are in a strong position as they already have a device that connects to the TV and a billing relationship with the customer. Doing this well is key to retaining subscribers in an increasingly OTT world. Aggregation does not just involve offering multiple OTT services with a single login. It requires aggregation of metadata associated with the content and tying that together with data on user preferences and behaviour so as to be able to offer unified search and recommendations across all content sources. Uniquely, pay TV operators can add their linear channels and VOD offerings into the mix to provide a true one-stop shop. with a steady supply of STBs being delivered to satisfy new subscribers and as replacement boxes when operators need to upgrade client hardware to enable new services adding, for example, broadband connectivity or support for higher screen resolutions. Even social media platforms are now offering live video services In the US, virtual pay TV operators providing multichannel linear and on-demand TV entirely over the internet are beginning to gain substantial numbers of subscribers. OTT services of this type that are provided by traditional pay TV operators are helping to compensate them for the erosion of their broadcast subscriber base, at least in terms of numbers. However revenue per subscriber is substantially lower. In general, these services allow operators to segment the market and attract additional out-of-area customers, and so can potentially offer an upside in most markets. For that reason, such services have been launched in many other countries around the world. The key to retaining subscribers for all pay TV providers has always been the availability of exclusive content. In many cases OTT providers do not have access to content until it has been shown elsewhere, so to remain competitive many are investing substantial funds in developing their own programming. This is forcing larger pay TV operators to counter with their own investments in content, leading to a golden age in program production spending. As investment is growing faster than revenue, this is not sustainable in the long term. Despite the growth of OTT services, the number of pay TV subscribers worldwide and the revenue that they generate continues to grow, though at a slow rate, mainly pulled down by subscriber losses in the USA. Broadband subscriptions and revenue are still growing strongly, moving the market advantage to the telcos and cable operators that can bundle internet connectivity with their TV products. The set-top box (STB) market is following the same trend Initially OTT services were predominantly available as apps on mobile devices which diverted viewing time from the main TV in the home. With the widespread availability of streaming on TV-connected STBs either using standalone digital media adapters or via pay TV operator boxes - this trend has to some extent been reversed especially for long-form content. There is still a propensity for younger people to prefer to watch on their personal devices however, so the second TV in the home has often now been replaced by a smartphone or a tablet.

5 Zenterio AB (publ) Org Nr As many OTT service providers do not have the resources to create apps for all of the many pay TV platforms in the world, the trend is for new STBs to be based on standardised platforms that can run existing apps. This is driving an increasing number of operators towards Android for their STBs, which enables re-use of apps from the mobile ecosystem. Operators have to decide in this case whether they use Android simply as an operating system upon which they build their own custom services or they sign up to the full Google-controlled network of services and obligations that come with Android TV. Processing in the cloud provides easier scalability, increased flexibility and saves cost OTT-only STBs, also often Android-based, are growing rapidly in popularity. Because of the open nature of the app ecosystems that these boxes tend to run, and the substantial numbers of units deployed, they are becoming not just a device for TV but also an attractive platform for advertisers. They are being integrated into the supply side platforms that are used by providers of targeted advertising. The same boxes generate data about the viewing habits of their users enabling better targeting of both content and ads using new artificial intelligence and deep learning techniques. The same opportunity for pay TV operators to exploit their client infrastructure for advertising exists but owing to fragmentation and closed architectures it is taking off at a slower rate. More positively, because pay TV operators have control of their devices, they can offer a brand-safe environment for advertisers, and they can extract insights without having to pass customer data to third parties. In addition, an operator can use the same techniques to promote their own content and services, helping to anticipate and reduce churn, and increase service takeup. Similarly for traditional advertising in TV channels and for the collection of correct carriage fees it is important to know the number of viewers that are watching any particular programme. Pay TV operators can extract highly accurate data from their devices which they can then sell to TV rating agencies. These agencies have traditionally relied on limited sampling models for their data which may not be representative and can miss programmes with small but loyal followings. Voice assistants in the form of smart speakers, or on mobiles, are now starting to appear in significant quantities in people s homes. As well as providing online services in response to spoken commands, they can also be used to control equipment in the home. This of course includes the TV user experience. Pay TV operators are taking different approaches to this depending on the role that they wish to play in this smart home market. Operators can integrate their TV devices with open market ecosystems, develop their own smart home voice offering, or provide a hybrid combination of the two.

6 Zenterio AB (publ) Org Nr The availability of low-cost high-performance server infrastructure and high-speed broadband connections is having an impact on the architecture of pay TV systems. Much of the back-end infrastructure that used to be provided by dedicated hardware is now being transferred to servers in the cloud. Processing in the cloud provides easier scalability, increased flexibility and saves cost. Operators have to decide whether they wish to use public cloud services or manage the cloud infrastructure themselves. Data protection regulations and political considerations are additional drivers here. The same trend towards cloud services is also affecting the client side of TV systems, with elements of the user experience increasingly being generated in the cloud. This enables the kind of continuous updates and personalisation that user have become accustomed to online. It also allows operators to ensure that the appropriate service level and quality of experience are made available to each and every device even in a world of proliferating unmanaged client hardware. 3DTV officially died in 2017 with the end of production of TVs that support it, but virtual reality (VR) continues to grow in its various forms immersive, augmented reality and 360 video. 360 video is particularly suited to live events such as sports and music concerts, on touch screen devices, and so has the potential to become an important niche pay TV format. Longer term, 5G trials have been taking place in most regions of the world. The technology has the potential to make TV-capable bitrates available to everyone everywhere. The extent to which 5G makes fixed broadband redundant over time will determine the disruptive effect of this technology on the balance of power in the pay TV industry of the future.

7 Zenterio AB (publ) Org Nr Our Business Model Zenterio sells its software, solutions and value services to TV and Broadband Operators, Telecom Operators and any other relevant players in the industry. Zenterio s portfolio encompasses an independent operating system, a state of the art User Interface, powerful data capture and data analytics tools as well as an interactive advertising management system. Zenterio also has a separate Services capability to complement this offering which positions the company as a full solutions provider. Zenterio provides services and expertise in the areas of system integration, interface development, app development, device design and technology consultancy. We also support customers in projects related to the IoT (Internet of Things), Android and cloud-based services. In addition to working directly with pay TV operators, Zenterio has implemented a unique, partner-driven business model. Zenterio s partners include three out of five of the biggest system integrators in the world: Ericsson, Huawei and Nokia. Being selected as an approved global partner validates Zenterio s strengths as well as its technical expertise and global market presence. Because of the complexity and very specific solution requirements, combined with the high costs involved in launching a new project, each partner often selects either only one or at most a very few global partners to supply client software. Currently, Zenterio generates revenues from software licenses, integration and consulting fees. Due to having recently made significant customer product launches Zenterio has moved into a new phase in our company development resulting in increased recurring revenues from maintenance and support contracts. We also have recurring revenues from subscription-based Value Added Services like big data analytics and interactive advertising.

8 Zenterio AB (publ) Org Nr Value added services enabled installed license base During Q1 of 2018 the value added services enabled license base increased by 12 thousand licenses to 7,2 million. The Q increase of licenses was mainly due to a Greek operator. The slow growth in the license base is explained by the large number of sold licenses in Germany and Mexico which are not yet fully deployed. Zenterio has started to offer advertising solutions, applications, and online services such as Netflix, Amazon Prime video and YouTube to operators that run Zenterio OS. The revenue model from such reseller agreements may be recurring and documented as average service revenue per user (ARPU) in Zenterio s reporting and will transform the company revenue dynamics overall. Given the current growth projections of the value added services enabled installed license base, Zenterio expects the sale of these services to start growing in 2018.

9 Zenterio AB (publ) Org Nr Financial Highlights SEK million Q Q Q Full Year 2017 Net sales and other operating income 59,4 51,4 64,6 240,3 Capitalised R&D 4,9 8,9 8,2 34,3 Other operating cost -61,7-69,9-61,0-255,0 Depreciation and amortisation -9,7-10,5-9,3-42,2 EBITDA 2,5-9,6 11,8 19,6 Net result -10,6-21,1-1,0-29,4 Operating cash flow -16,3-4,9 11,1 2,7 The quarter Net sales Net Sales and other income amounted to SEK 59,4 million during first quarter 2018, representing an increase of 15,5 % compared to first quarter Net Sales were split between engineering services SEK 50,3 million (SEK 47,6 million), Licenses SEK 0,8 million (SEK 0,5 million), maintenance & support SEK 5,6 million (SEK 1,8 million) and value added services SEK 0,3 million (SEK 1,2 million). Other operating income amounted to SEK 2,4 million (SEK 0,3 million) and was split between cash discount SEK -0,5 million (SEK -0,6 million)other revenues SEK 0,3 million (SEK 0,2 million). Exchange gains SEK 2,7 million (SEK 0,7 million). Operating cost In first quarter 2018, total costs decreased to SEK 71,4 million compared to SEK 80,4 million in the first quarter The total costs during the period were split between cost of goods sold of SEK 0,6 million (SEK 2,7 million), operating expenditures of SEK 61,1 million (SEK 67,2 million) and depreciation and amortisation of SEK 9,7 million (SEK 10,5 million). EBITDA EBITDA for the first quarter of 2018 amounted to SEK 2,5 million compared to SEK -9,6 million in first quarter This equals a 12,1 MSEK EBITDA improvement and is mainly explained by improved margins driven by a reduction of cost for personnel and other services, and improved commercial terms with a German Tier one operator Net result Net result for the first quarter 2018 improved to SEK -10,6 million (SEK -21,1 million). Financial net cost amounted to SEK -3,5 million (SEK -1,5 million) and the explanation to the increase in cost was explained by new borrowings. Income tax expense remained on a low level and amounted to SEK 0,4 million (SEK 0,4 million). Investments Investments in the quarter was mainly capitalized cost for research and development. In the quarter SEK 4,9 million (SEK 8,9 million) was capitalised as Intangible assets. The decrease in Research and development expense is explained by less generic development related to our contract with a German Tier one operator which now moved into a new phase where the need of development is lower. Depreciation rate is 5 years on intangibles.

10 Zenterio AB (publ) Org Nr Cashflow Operational cash flow during the first quarter of 2018 amounted to SEK -16,3 million compared to SEK -4,9 million for the first quarter in Working capital grew by SEK 12,5 million in the first quarter due to customer payments being pushed to April. On March 31, 2018, cash and cash equivalents amounted to SEK 7,8 million compared to SEK 35,3 million on March 31, In addition there was SEK 7,5 million of unused overdraft facilities on March 31, Data per Share Q Q Full Year 2017 Number of shares at end of period Average number of shares Earnings per share before and after dilution -0,21-1,06-0,33 Equity per share 1,87 2,07 1,98 Earnings per share: Total comprehensive income divided by average number of shares. Equity per share: Equity divided by the number of shares at end of period. Personnel Personnel Q Q Q Q Q Q Average number of employees The average number of employees decreased by 8 during the quarter. This was primarily due to reduction of heads in the Swedish sites. Segment information Operating segments are reported in a manner consistent with the internal reports submitted to the Chief Operating Decision Maker (CODM). The CODM is the function responsible for allocating resources to and assessing the performance of the operating segments. Within the Zenterio Group, this function has been identified as the Zenterio Management team that makes strategic decisions. Zenterio therefore reports all its operations in one segment. Fair value measures The classification in the fair value hierarchy was considered in the measurement of financial instruments at fair value. The definition of the various levels can be found in the Annual report, Note 3.3. At March the group reported a financial liability of SEK 0,5 million (SEK 4,0 million) classified at level 2, arising from an embedded derivate attributable to a convertible note issued in The rest of the Group s financial instruments are classified at level 3.

11 Zenterio AB (publ) Org Nr Financial ratios Q Q Full Year 2017 EBITDA margin % 3,9-15,9 7,8 Profit margin % -16,5-35,1-10,9 Return on equity % -10,9-51,6-15,5 Equity/asset ratio % 56, Net debt in MSEK 51,4 11,4 29,3 Net sales per employee in MSEK 1,8 1,4 1,7 EBITDA margin: Earnings before interest and depreciation as percentage of Total revenue. Profit margin: Net result as percentage of Total revenue. Return on equity: Net result as percentage of average equity. Net Debt: Total long term and short term borrowings less cash and cash equivalents. Net Sales per employee: Total revenue by average of employees. For quarterly reports Total revenues are estimated on a full year basis. Equity/asset ratio: Equity including non-controlling interests as percentage of the balance sheet total. Reconcilation of financial ratios Return on equity - amounts in MSEK Q Q Full Year 2017 Net result -19,3-70,7-29,8 Opening equity 186,1 88,3 207,2 Closing equity 168,1 186,1 178,4 Return on equity % -10,9-51,6-15,5 Net Debt - amounts in MSEK Q Q Full Year 2017 Liabilities to credit institutions long and short term 27,7 15,2 26,2 Convertible note 31,0 27,5 30,1 Financial derivates 0,5 4,0 1,4 Cash and cash equivalents -7,8-35,3-28,4 Net debt 51,4 11,4 29,3 Events after reporting date No events to report after the reporting date.

12 Financial statements

13 Zenterio AB (publ) Org Nr Consolidated statement of profit or loss Amounts in KSEK Jan-Mar 2018 Jan-Mar 2017 Full Year 2017 Net sales Capitalised research & development Other operating income Total revenue Cost of goods sold Personnel expenses Other external expenses Other operating expenses Depreciation, amortisation and impairment of assets Total operating expenses Operating profit (loss) Finance income Finance costs Net finance income (costs) Profit (loss) before tax Income tax expense Profit (loss) for the period Consolidated statement of comprehensive income Amounts in KSEK Jan-Mar 2018 Jan-Mar 2017 Full Year 2017 Profit (loss) for the year Other Comprehensive Income: Items that may be reclassified subsequently to profit or loss Foreign currency translation Other Comprehensive Income for the period Total Comprehensive Income for the period Total Comprehensive Income (loss) is attributable entirely to owners of the parent company.

14 Zenterio AB (publ) Org Nr Consolidated statement of financial position Amounts in KSEK 30 Mar Mar Dec 2017 ASSETS Non-current assets Intangible assets Goodwill Capitalised development costs Other intangible assets Total intangible assets Tangible assets Property, plant and equipment Total tangible assets Financial assets Other non-current receivables Total financial assets Total non-current assets Current assets Inventory, etc. Raw materials and consumables used Total Inventory Current receivables Trade receivables Current tax assets Other receivables Prepaid expenses and accrued income Total current receivables Cash and cash equivalents Total current assets TOTAL ASSETS

15 Zenterio AB (publ) Org Nr Consolidated statement of financial position, cont. Amounts in KSEK 31 Mar Mar Dec 2017 EQUITY AND LIABILITIES EQUITY Share capital Other capital contributions Reserves Retained earnings (loss) Total equity LIABILITIES Non-current liabilities Liabilities to credit institutions Other non-current liabilities *) Deferred tax liabilities Total non-current liabilities Current liabilities Liabilities to credit institutions Derivative instruments Trade payables Current tax liabilities Other liabilities **) Accrued expenses and prepaid income Total current liabilities TOTAL EQUITY AND LIABILITIES Pledged assets Contingent liabilities None None None *) Include convertible note classified as long term interest bearing debt amounting to SEK 0 thousand (SEK thousand) and at year end 2017 SEK 0 thousand. **) Include convertible note classified as short term interesting bearing debt amounting to SEK thousand (SEK 0 thousand) and at year end 2017 SEK thousand.

16 Zenterio AB (publ) Org Nr Consolidated statements of changes in equity Amounts in KSEK Share capital Other capital contributions Reserves Retained earnings (loss) Total Equity Balance at 1 January Profit (loss) for Jan-Mar Other Comprehensive Income for the year Balance at 31 March Profit (loss) for Apr-Dec Other Comprehensive Income for the year Warrants Balance at 31 December Profit (loss) for the period Other Comprehensive Income for the year Balance at 31 March

17 Zenterio AB (publ) Org Nr Consolidated statements of cash flows Amounts in KSEK Jan-Mar 2018 Jan-Mar 2017 Full Year 2017 Cash flows from operating activities Operating profit (loss) Adjustments for items not affecting cash flow Interest received Interest paid Income tax paid Cash flows from operating activities before changes in working capital Change in working capital Net cash from (used in) operating activities Cash flows from investing activities Acquisition of subsidiary, net of cash acquired Acquisition of tangible assets Acquisition of intangible assets Acquisition of financial assets Sale of tangible assets Cash flows from investing activities Cash flows from financing activities Change in credit facility Change in factoring Short term borrowings Long term borrowings Cash flows from financing activities Decrease/increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Translation differences in cash and cash equivalents Cash and cash equivalents at the end of the period

18 Zenterio AB (publ) Org Nr Parent company income statement Amounts in KSEK Jan-Mar 2018 Jan-Mar 2017 Full Year 2017 Operating income Net sales Work performed and capitalised Other operating revenue Total revenue Cost of goods sold Personnel expenses Other external expenses Other operating expenses Depreciation, amortisation and impairment of assets Total operating expenses Operating profit/loss Profit (loss) from investments in subsidiaries Interest income and similar income items Interest expenses and similar loss items Net finance income or costs Profit or loss after net finance (costs) Tax on profit (loss) for the period Profit (loss) for the period There are no items for the parent company recognised in Other Comprehensive Income; Total Comprehensive Income therefore corresponds to profit (loss) for the period.

19 Zenterio AB (publ) Org Nr Parent company balance sheet Amounts in KSEK 31 Mar Mar Dec 2017 ASSETS Non-current assets Intangible assets Capitalised development costs Total intangible assets Tangible assets Property, plant and equipment Total tangible assets Financial assets Investments in group companies Other non-current receivables Total financial assets Total non-current assets Current assets Inventory, etc Raw materials and consumables used Total Inventory Current receivables Trade receivables Tax assets Other receivables Receivables from group companies Prepaid expenses and accrued income Total current receivables Cash and bank balances Total current assets TOTAL ASSETS

20 Zenterio AB (publ) Org Nr Parent company balance sheet, cont. Amounts in KSEK 31 Mar Mar Dec 2017 EQUITY AND LIABILITIES EQUITY Restricted equity Share capital Non-restricted equity Total restricted equity Non-restricted equity Share premium reserve Retained earnings Profit (loss) for the year Total non-restricted equity Total equity LIABILITIES Non-current liabilities Liabilities to credit institutions Other liabilities *) Total non-current liabilities Current liabilities Liabilities to credit institutions Trade payables Liabilities to group companies Current tax liabilities Other liabilities **) Accrued expenses and prepaid income Total current liabilities TOTAL EQUITY AND LIABILITIES Pledged assets Contingent liabilities None None None *) Include convertible note classified as long term interest bearing debt amounting to SEK 0 thousand (SEK thousand) and at year end 2017 SEK 0 thousand. **) Include convertible note classified as short term interesting bearing debt amounting to SEK thousand (SEK 0 thousand) and at year end 2017 SEK thousand.

21 Zenterio AB (publ) Org Nr Risk factors Zenterio s risk factors are described on pages in Zenterio s 2017 Annual report. Apart from the general concern about the economy and the political unrest in some countries, the assessment is that no new significant risks or uncertainties have arisen. The report is available on Accounting policies The interim report has been prepared in accordance with IAS 34 and the Annual Accounts Act. The consolidated accounts have been prepared in accordance with the Annual Accounts Act, the Swedish Financial Reporting Board recommendation RFR 1, Supplementary accounting rules for groups, International Financial Reporting Standards (IFRS) and interpretations by the IFRS Interpretations Committee (IFRIC) as adopted by the EU. Zenterio s accounting policies are described on pages in Zenterio s 2017 Annual report. Changes in accounting principles applied from January 1, 2018 IFRS 9, Financial instruments Zenterio will apply IFRS 9 from January 1, IFRS 9 replaces IAS 39, Financial instruments; Recognition and measurement. IFRS 9 involves changes in how financial assets are classified and measured, introduces an impairment model for expected credit losses and changes in hedge accounting requirements. Regarding the changes in the requirements in hedge accounting, this will have no impact on Zenterio s existing hedges but may impact future hedging arrangements. The standard also introduce a new impairment model for valuation of financial assets, this new model will have insignificant effect on Zenterio s reporting. IFRS 15, Revenue from contracts with customers Zenterio will apply IFRS 15 from January 1, IFRS 15 is the new standard for revenue recognition and replaces IAS 18 Revenue and IAS 11 Construction Contracts and all the relevant interpretations (IFRIC and SIC). Zenterio has evaluated the Group s contracts and concluded that revenue recognition will not be impacted by the transition to IFRS 15. This report has not been subject to review by the company s auditors Linköping, 18 April 2018 Zenterio AB Jörgen Nilsson, Chief Executive Officer