Quarterly Report 3 2024

Stockholm 2024-10-18

Quarterly report 3 2024: Sales growth 145%

Financial highlights Q3

• Sales growth adjusted for prepaid revenues: 145% compared to Q3 2023.
• Positive EBITDA adjusted for restructuring costs and prepaid revenues: approximately MSEK 5,1, corresponding to an EBITDA margin of about 55%.
• Positive cash flow: KSEK 609 during Q3.
• Contracted Annual Recurring Revenue (CARR) amounts to MSEK 28,3 based on contracted customers as of October 11. In the Q2 2024 report, CARR amounted to MSEK 23,4, based on contracted customers as of August 15.
• In the month of September, sales, adjusted for prepaid invoiced revenue, amounted to MSEK 4,7, and adjusted EBITDA, excluding restructuring costs, amounted to just over MSEK 2,6.

Summary July - September 2024 (compared to the same period the previous year):

• Net sales adjusted for prepaid revenues: KSEK 9 377 (KSEK 3 834)
• EBITDA adjusted for prepaid revenues and restructuring costs: KSEK 5 136 KSEK ( KSEK -750)
• Net sales for the period: KSEK 6 079 (KSEK 3 834)
• EBITDA for the period: KSEK 563 (KSEK -1 750), adjusted for restructuring costs: KSEK 1 838 (KSEK -750)
• Result for the period: KSEK 1 343 (KSEK -4 453)
• Sales per share: SEK 0,21 (SEK 0,13)
• Earnings per share: SEK 0,05 (SEK -0,16)
• Equity per share: SEK 2,19 (SEK 2,44)

Summary January - September 2024 (compared to the same period the previous year):

• Net sales adjusted for prepaid revenues: KSEK 20 758 (KSEK 10 618)
• EBITDA adjusted for restructuring costs and prepaid revenues: KSEK 10 791 (KSEK -4 122)
• Net sales for the period: KSEK 15 583 (KSEK 10 618)
• EBITDA for the period: KSEK 1 301 (KSEK -4 122), adjusted for restructuring costs: KSEK 5 615 (KSEK -4 122)

• Result for the period: KSEK -3 353 (KSEK -14 011)
• Sales per share: SEK 0,55 (SEK 0,37)
• Earnings per share: SEK -0,12 (SEK -0,49)
• Equity per share: SEK 2,19 (SEK 2,44)

Events During the Period

• The savings program's effects were realized by the end of Q1, securing savings of approximately MSEK 10 annually, compared to the initially estimated MSEK 7-9. The work of reviewing the cost side of the organization's structure has since continued, leading to additional savings of approximately MSEK 1, beyond the previous savings program, which are expected to take full effect at the beginning of Q4 2024.
• EyeonGroup changes CEO, Georg Tsaros steps down, and Fredrik Björklund, current Chairman, will assume the role of CEO starting September the 1st.
• EyeonGroup secures a MSEK 10 loan facility from the company's main owner.
• EyeonGroup hires Translink Corporate Finance as an M&A advisor.
• EyeonGroup establishes a sales office in Dubai.
• EyeonGroup signs several reseller agreements for the new B2B service.
• EyeonGroup takes over a former reseller's B2C business, now operated under the Protectia brand.
• EyeonGroup broadens its product portfolio through strategic licensing agreements for VPN and Password Manager.
• EyeonGroup signs reseller agreements with Yettel Bulgaria and a fintech company in the USA regarding Eyeon Group's id-protection service (white label).
• EyeonGroup to deliver a Proof of Concept to a banking group in the Netherlands and has signed a Letter of Intent with Locon in Poland for a white label solution.
• EyeonGroup updates its plan to accelerate the company's sales force, aiming to increase the sales team to 33 sellers by the end of August to achieve closed deals equivalent to approximately TEUR 440 per month. The goal is to reach sales of MSEK 100 for the fiscal year 2025.
• When Fredrik Björklund assumed the role of CEO on September 1, Børge Granli took over as Chairman of the Board. For the next Annual General Meeting in 2025, EyeonGroup's main owner, Mattias Kaneteg, has announced that he is available to the Nomination Committee for the upcoming term.
• EyeonGroup has signed a white label reseller agreement with a Nordic telecom operator for the resale of EyeonGroup's ID protection service.
• EyeonGroup has entered into an agreement with Mangold Fondkommission as a financial advisor in the process of changing stock exchange.

Events After the Period

• EyeonGroup has entered into a white label agreement with Ekomni AB regarding the resale of EyeonGroup's ID protection service to Ekomni's customer groups in the Swedish market.

CEO statement

As we close the third quarter, I am proud to share the updates Eyeon Group has made to continue the journey we started earlier this year. Our commitment to delivering cybersecurity solutions remains as strong as ever, and this quarter has been particularly crucial in paving the way for future success.

First and foremost, we have achieved a significant milestone by passing the Payment Card Industry Data Security Standard (PCI DSS) v4.0 certification. This is a major accomplishment for us, as it underscores our dedication to the highest security standards. Our Dark Web monitoring solutions are now stronger than ever, providing our customers with real-time alerts and actionable insights if their credit card information is leaked. This is a big step forward in ensuring that we can help both businesses and consumers protect their financial data in today's increasingly volatile digital landscape.

In addition to strengthening our security protocols, we are pleased to welcome Alice Samuelsson as our new Product Manager. Alice brings extensive experience from her time at Hitta.se, a leading Swedish company known for its innovative digital products. With her on the team, we are focused on further developing our B2B products. Alice's leadership will be crucial as we continue to integrate a wider range of cybersecurity solutions, aiming to become the go-to One-Stop Shop for cybersecurity businesses. Her expertise is already driving exciting new initiatives that will differentiate us from the competitors.

Finally, we are excited to announce that we have signed an agreement with Mangold Fondkommission, marking the first steps in our planned transition from the Nordic Growth Market (NGM) to Nasdaq. This strategic shift is a major leap forward for Eyeon Group, as it will increase our visibility in the global market and provide us with new opportunities to expand our reach and resources. Our move to Nasdaq signals our ambition and readiness to scale further and offer greater value to our shareholders and stakeholders.

During the third quarter, we also secured three major white label agreements, further strengthening our reputation as a trusted cybersecurity partner:

• A major telecom operator in the Nordics: We signed a white label agreement with a leading low-cost telecom operator in the Nordic market. This partnership allows us to expand our reach and deliver top-notch cybersecurity services to a broad customer base in the region.
• Locon in Poland: We secured an agreement with Locon, which serves the largest telecom companies in Poland. Our solutions will help them enhance the security of their customer base and strengthen their position as leaders in the Polish telecom industry.
• A prominent bank in the Netherlands: After competing against 30 other cybersecurity providers, we were selected as the preferred provider for one of the largest banks in the Netherlands. This win highlights our superior offerings and our ability to deliver tailored, high-performance solutions in a highly competitive environment.

Additionally, we are pleased to announce three new revenue-sharing agreements that further expand our reach in Europe and the U.S.:

• 24SevenOffice: We have now started sales with 24SevenOffice, a leading provider of cloud-based business solutions with over 30,000 customers in the Nordics and the U.S. This partnership allows us to tap into their diverse customer base and expand our cybersecurity services in the Nordics.
• Domeneshop: After Domeneshop's recent acquisition by Miss Group, we signed an agreement with them earlier this year in May. Domeneshop's strong presence in domain registration and web hosting enables us to collaborate closely and expand our services within their existing infrastructure.
• Youtec Systems GmbH: A Swiss company offering support solutions to customers of SwissCom, Switzerland's leading telecom operator. Youtec Systems GmbH has become one of our valuable partners, and this agreement will enhance cybersecurity for SwissCom's customers and businesses across Switzerland.

I also want to take a moment to acknowledge the outstanding work our B2B sales team has done. Since its launch in April, this team has been on an unstoppable growth trajectory. In just a few months, they have expanded from 20 employees (including resellers) at the end of August to 30 by early November. This talented team has closed over 3 000 contracts during the third quarter since its inception, and in October, we surpassed 4 000 contracts sold. Thanks to their efforts, we are now selling our cybersecurity solutions in our markets, including Sweden, Norway, Finland, Switzerland, Spain, the United Kingdom, and the U.S.

As we look ahead to the fourth quarter and beyond, I am confident that these achievements will drive us toward even greater successes. Our team remains committed to innovation, growth, and securing the digital future for our customers.

Fredrik Björklund
CEO, Eyeon Group AB

Description of the business

Eyeon Group AB (publ) was founded in 2015 and is a SaaS provider that, through proprietary technology for collecting, analyzing and packaging data, develops and sells smart solutions that make life on the internet easier and safer for people, companies and organizations. The company provides business solutions within IT security, privacy protection services and AI-based data solutions. These are primarily aimed at the B2B market in Europe for industries such as e.g. banking, insurance and telecom.

Eyeon Group in Brief

Eyeon Group AB (publ) is the parent company of a group with two wholly-owned subsidiaries: Protectia AB and EyeonID Intressenter AB,. During the period, the American subsidiary Eyeonid Inc and the Belgian subsidiary EyeOnText BVBA was liquidated. EyeonGroup's headquarters, including development, production, and administration, is located in Stockholm. As of April this year, the company has a sales office in Dubai.

This report covers the entire group's and the parent company's operations during the period from January 1 2024 to September 30 2024.

Financial overview

The following section presents summarized financial information for EyeonGroup for July - September 2024 compared with the period July - September 2023 and January - September 2024, compared with the period January - September 2023. During the period, EyeonGroup acquired the wholly-owned subsidiary Protectia AB, which is included in the consolidated accounts from May 1, 2024. During the period, the subsidiaries Eyeonid Inc and EyeOnText BVBA have been liquidated. The American company was primarily established to ensure a structure that complied with regulatory requirements according to the conditions at the time. As conditions have changed, there is no longer any justification for the cost of maintaining the company. The consolidated result of the liquidation amounts to KSEK 2 154. During the period, significant cutbacks within the EyeonText business area were decided and initiated, with full effect of these savings achieved by the end of the first quarter of 2024. During the period, a dividend of 1 385 TSEK was decided in the subsidiary EyeonText to the parent company. The dividend has no impact on the group's result. With the closure of operations in Belgium, the Belgian company was liquidated during the third quarter of 2024, and the consolidated financial result of the liquidation amounts to KSEK 4,599.

Sales and results

July - September

The group's net sales for the period amounted to KSEK 6 079 (KSEK 3 834), with a net result of KSEK 1 343 (KSEK -4 453). The consolidated result from the liquidation of EyeOnText BVBA amounts to KSEK 4 599.

Sales were distributed as follows:

B2B KSEK 962 (KSEK 0)

B2C KSEK 632 (KSEK 0)

B2B2C White label KSEK 4 484 (KSEK 3 834)

Prepaid revenues amounted to KSEK 4 401 (SEK 0).

January - September

The group's net sales for the period amounted to KSEK 15 583 (KSEK 10 618), with a net result of KSEK

-3 435 (KSEK -14 011). The consolidated result from the liquidation of Eyeonid Inc amounts to KSEK 2 154 and the liquidation of EyeOnText BVBA amounts to KSEK 4 599.

Sales were distributed as follows:

B2B KSEK 1 191 (KSEK 0)

B2C KSEK 1 255 (KSEK 0)

B2B2C White label KSEK 13 137 (KSEK 10 618)

Prepaid revenues amounted to KSEK 6 507 (SEK 0).

Liquidity and financing

As of September 30 2024, EyeonGroup's bank balances amounted to KSEK 6 170 (KSEK 11 527). The group had interest-bearing liabilities of KSEK 2 260 (SEK 0).

Investments

July - September

Eyeonid's total new investments during the period amounted to KSEK 2 180 (KSEK 3 147) and concerned intangible fixed assets amounting to KSEK 2 180 (KSEK 3,147) such as capitalized development costs, and tangible fixed assets amounting to KSEK 0 (KSEK 0).

January - September

Eyeonid's total new investments during the period amounted to KSEK 7 417 (KSEK 9 450) and concerned intangible fixed assets amounting to KSEK 7 408 (KSEK 9 450) such as capitalized development costs, and tangible fixed assets amounting to KSEK 9 (KSEK 0).

Depreciation

July - September

The period's result was charged with KSEK 3 742 (KSEK 3 663) in depreciation, of which KSEK 51 (KSEK 58) refers to depreciation on equipment, tools, and installations, KSEK 3 669 (KSEK 3 604) refers to depreciation of capitalized development costs, and goodwill depreciation of KSEK 22 (KSEK 0).

January - September

The period's result was charged with KSEK 11 407 (KSEK 10 384) in depreciation, of which KSEK 157 (KSEK 242) refers to depreciation on equipment, tools, and installations, KSEK 11 214 (KSEK 10 141) refers to depreciation of capitalized development costs, and goodwill depreciation of KSEK 36 (KSEK 0).

Equity

As of September 30, 2024, EyeonGroup's equity amounted to KSEK 62 189 (KSEK 69 436).

The share and share-related Instruments

As of September 30, 2024, the share capital of Eyeon Group AB was divided into 28 410 125 shares with a nominal value of SEK 0.2. All shares are of the same series and have the same right to vote and profit in the company. The shares in EyeonGroup have been traded on NGM Nordic SME under the ticker EOID since September 20, 2016. Since February 7, 2023, the shares in Eyeonid have been traded with ISIN code SE0019763988 after the share consolidation decided at the extraordinary general meeting on January 27, 2023. EyeonGroup does not have a liquidity guarantee agreement.

At the 2023 annual general meeting, it was decided to introduce the Employee Stock Option Program 2023/2026 and the Warrant Program 2023/2026. The programs are aimed at the company's employees and consultants. Each option under the respective program entitles the holder to subscribe for one share. The exercise period runs from September 1, 2026, to September 30, 2026. If all issued options are exercised to subscribe for shares, the number of shares will increase by 1,495,269 shares, corresponding to a dilution of approximately 5 percent of the total number of shares and votes in the company. Due to known personnel changes, the number of shares will increase by 897,159 shares upon full exercise of issued options, corresponding to a dilution of approximately 3% of the total number of shares and votes in the company.

Employees

As of September 30, 2024, Eyeonid had approximately 2 (5) employees and around 30 consultants affiliated with EyeonGroup.

Accounting principles

The report has been prepared in accordance with the Annual Accounts Act of Sweden and BFNAR 2012:1 Annual Report and Consolidated Financial Statements (K3). Applied principles are consistent with those described in the 2023 annual report.

Upcoming reporting dates

Eyeon Group AB provides regular financial information according to the following schedule:

This report has not been subject to review by the company's auditor.

October 18, 2024

Eyeon Group AB (publ)

The Board of Directors

For further information, please contact:

Fredrik Björklund

CEO

+46 70-892 35 92

Carl-Magnus Jönsson

CFO

+46 73-545 53 50

This information is information that Eyeonid Group AB (publ) is obliged to disclose under the EU Market Abuse Regulation. The information was provided, through the contact of the above contact person, for publication on October 18, 2024, at 08.30 CET.

Definition of KPI:s

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