EFECTE PLC  --  COMPANY ANNOUNCEMENT --  15 FEBRUARY 2024 at 8.30

Efecte Plc's Financial Statements Bulletin 2023 – SaaS +22%, adjusted EBITDA margin +3%

10-12/2023:

·       Total net sales grew by 11% and was 6.5 million euro (5.9) 

·       SaaS grew by 18% and international SaaS by 16% 

·       EBITDA was 0.1 million euro (-0.2) and EBIT -0.3 million euro (-0.5) 

·       Adjusted EBITDA¹ was 0.5 million euro (-0.0)

·       EBITDA margin was 1% (-3%) and adjusted EBITDA¹ margin was 8% (-1%)

·       Public sector success continued with winning the BG Kliniken public tender in Germany

1-12/2023:

·       Total net sales grew by 13% and was 24.7 million euro (21.6) 

·       SaaS grew by 22% and international SaaS by 26% 

·       EBITDA was 0.2 million euro (-0.0) and EBIT -1.4 million euro (-0.9)

·       Adjusted EBITDA¹ was 0.8 million euro (0.5)

·       EBITDA margin was 1% (-0%) and adjusted EBITDA¹ margin was 3% (2%)

Guidance for 2024:

In 2024, Efecte’s net sales are expected to be approximately EUR 25 – 30 MEUR, SaaS net sales is expected to grow over 15% and adjusted EBITDA margin is expected to be 3 – 9%.

Group key figures

¹ Excludes following costs related to inorganic activities and other non-recurring costs: 0.4 million in 10-12/2023, 0.1 million euro in 10-12/2022, 0.6 million euro in 2023, and 0.5 million euro in 2022.

CEO Niilo Fredrikson:

Efecte turned 25 years in December, and we honored the milestone by closing another year of significant progress towards our vision: building the Leading European Alternative in service management software. We helped our customers to digitalize and automate their work, made the Efecte platform better than ever, and delivered all the financial results we had promised. I want to use the opportunity to thank everyone in the Efecte community – employees, customers, partners and shareholders – for having been part of the journey so far. It has been an absolute privilege to work with you.

Improving profitability and slower SaaS growth

During Q4, SaaS growth was 18%. This was somewhat slower than earlier in the year but faster than market growth and in line with our expectations. While growth in Finland was solid, international SaaS growth was slower than usual at 16%.

We saw profitability starting to turn around already Q3, and adjusted EBITDA continued to improve in Q4. This was driven by continued growth while at the same time making sure our costs were at the right level. Improving our professional services operation also supported the bottom line. Thanks to a new organization and focus on operational excellence, professional services delivered better gross profit than earlier in the year.

Public sector success continued

At the end of the year, we won another significant public tender, BG Kliniken in Germany. The win was another proof point for our offering being especially competitive in the public sector, also outside Finland. Earlier in the year we gained several wins in Sweden. This is a good foundation to build on also in the new year.

Intense product development continued during Q4, focusing on AI features with local deployment options and enhanced user interfaces both for self-service and agent users. These developments will support our momentum in the public sector, but also improve our competitiveness in the private sector. ITSM Essentials, our fast-to-start entry-level offering launched in Q3, gained traction with the first wins.

Looking ahead

Efecte is positioned well for 2024. Last year, we invested in our product and team, developed our way of operating and streamlined our organization. We are now well set up to grow and improve profitability in line with our guidance. We plan to keep winning in the market and keep building the Leading European Alternative in service management software.

Matrix42, a portfolio company of Corten Capital, acting through European 24 Bidco Oy, have made a voluntary recommended public cash tender offer for all the outstanding shares and stock options in Efecte Plc. The Efecte Board has unanimously recommended that the shareholders and holders of stock options of Efecte accept the tender offer. If the tender offer is successful, we have the possibility to accelerate the achievement of our vision of becoming the leading European provider of service management software, creating an even better future for our customers, partners and employees. I look forward to the next phase of Efecte with confidence and excitement.

Additional information:

Interim CFO Tommi Mäkinen, +358 40 042 1659
CEO Niilo Fredrikson, +358 50 356 7177

Certified adviser: Evli Oyj, tel. +358 40 579 6210

The amounts in this report have been rounded from exact numbers.

NET SALES AND PROFIT

Net sales by type

Efecte's net sales in 1-12/2023 were 24.7 million euro (21.6), a growth of 14%. Net sales for customers outside Finland were 5.7 million euro (5.3), corresponding to 23% of total net sales (25%).

Software as a Service (SaaS) grew 22% (26%) and services net sales increased by 2% (19%). Net sales of perpetual licenses continued to be insignificant in line with our strategy. Net sales generated by maintenance related to perpetual licenses continued its declining trend. Our total recurring revenue (SaaS and maintenance) amounted to 17.6 million euro (14.7), corresponding to approximately 71% of net sales (68%).

SaaS MRR was 1 490 thousand euro in the end of December, growing 17% year-over-year. Of that growth, 10 percentage points came from existing customers (net retention rate of 110%) and 8 percentage points from new customers since 12/2022 and from customers of acquired Requeste. Gross churn amounted to 4.5% (2.3%). Our recurring gross margin stood at 77% at the end of December (80%). Recurring gross margin includes now the former InteliWISE business. This was the main driver for the decrease from the comparison period. At the end of the period, the share of SaaS MRR attributable to enhanced support packages that include administrator services for customers was 6 (3) thousand euro.

Our average customer acquisition cost (CAC) on a rolling 12-month basis was 86 thousand euro (98), and the average lifetime value (LTV) of an acquired new customer was 392 thousand euro (994). Accordingly, the LTV/CAC ratio was 4.6 (10.2). This means that the cost of customer acquisition is earned 4.6 times during the lifetime of the customer. The significant drop in LTV is for the most part attributable to gross churn returning to normal levels from the exceptionally low levels last year.

Net retention, gross churn, recurring gross margin, CAC and LTV were calculated based on Efecte and former InteliWISE numbers excluding Requeste customers.

Services net sales grew 2%. Our strategy is to focus on growing our SaaS business and the Services business is there to support adoption with the help of our partner network. SaaS formed already 68% of total net sales (64%).

EBITDA was 0.2 million euro (-0.0), and operating profit was -1.2 million euro (-0.9). EBITDA was impacted by inorganic activities and other non-recurring restructuring costs.

Adjusted EBITDA was 0.8 million euro (0.5). Adjusted EBITDA is calculated from EBITDA by deducting the costs affecting comparability. During the review period, these items included costs related to inorganic activities and non-recurring restructuring costs amounting to 0.6 million euros (0.5).

Income tax expenses were 0.0 million euro (0.6). The comparison period was affected by the positive effect of the recognition of deferred tax assets from unused tax losses in Finnish taxation.

Net profit for the period was -1.3 million euro (-0.3). In addition to the difference in income tax expenses, the largest contributor to the decline compared to the previous year were goodwill depreciations originating from the InteliWISE and Requeste acquisitions.

FINANCE AND INVESTMENTS

At the end of the review period, the balance sheet for the Efecte group totaled 15.6 million euro (15.4). Equity ratio was 31% (39%) and net gearing was -16% (-28%).

At the end of the review period, the Company’s financial loans were 1.6 million euro (1.9). The company's cash and liquid assets were 2.1 million euro (3.1).

Cash flow from operating activities for the reported period was 0.6 million euro (0.5) and cash flow from investing activities was -1.6 million euro (-7.2). Investments in tangible and intangible assets were 1.5 million euro (1.4) and were mainly activated R&D expenses. Cash flow from financing activities was 0.0 million euro (3.3). Cash flow from financing activities consisted of subscriptions relating to stock options and loan repayments.

BUSINESS DEVELOPMENTS

We continued to focus on helping European mid-sized organizations to digitalize and automate their work. Customers use our cloud-based platform to digitalize and automate processes in three key areas: Enterprise Service Management (ESM), Identity Governance and Administration (IGA) and Conversational AI.

During the review period, our SaaS growth was 22%, which was in line with our expectations.  We signed a total of 57 new customers in Finland, Scandinavia, DACH, Spain and Poland, of which over half came from outside Finland. Of the new customers during the period, 10 came through partners. Through the former InteliWISE business, we signed 14 new customers during the review period. In addition to the new customers, we also helped our existing customers to expand the usage of Efecte in ITSM and ESM. On a rolling 12-month basis, existing customers accounted for 56% of the SaaS MRR growth. The interest in the newly launched Effie AI product family continued strong and we signed the first pilot customers for the new features in the product family.

All our existing direct markets continued to win customers despite the weakened macroeconomic climate. Especially our core markets Finland and Scandinavia exceeded our expectations as we continued our good traction in the public sector. In Spain and New Markets, we laid out a new growth plan and expect to see more results during 2024.

In professional services, we were able to get back on a profitable growth track after a challenging first half. More importantly we saw good execution in identified focus areas which also had a positive impact on the bottom line. The main drivers were the demand from new customers, expansion opportunities in existing customers and driving overall operational excellence.

In September 2023, we acquired the Requeste business from Sysart Oy. Requeste is a ticketing, customer service and ITSM solution with strong footprint in Finnish midmarket customers. Requeste business has four employees in Oulu, Finland and its net sales in 2022 were approximately 500 thousand euros, over half of which SaaS.

EMPLOYEES

The number of full-time equivalent employees at the end of the review period was 199 (194). Of these, 121 (125) were in Finland, 50 (44) in Poland, 18 (19) in Germany, 8 (6) in Sweden and 3 (1) in Spain. The average number of employees during Q4 was 203 (138) and during 2023 it was 204 (161). Our central team in Finland acts globally supporting customers, partners and sales in international markets and includes the headcount responsible for our New Markets operation.

During the year, we welcomed four new Efectians through the acquisition of Requeste business from Sysart. We also held change negotiations as communicated on 1 November 2023 to streamline operations and ensure the successful execution of our strategy. The negotiations resulted in the termination of eight employees. In addition, we adopted organizational and role changes as well as implemented other cost savings measures across all our group companies.

The company’s leadership team composition at the end of the period was the following: Niilo Fredrikson (CEO), Tommi Mäkinen (Interim CFO), Niina Hovi (people and culture), Juha Westerlund (sales and revenue), Topias Marttila (technology), Marcin Strzalkowski (marketing and country manager Poland), Santeri Jussila (products) and Jenni Mickos (services).

MARKET OUTLOOK

Our solution offering consisting of Enterprise Service Management, IGA and Conversational AI is an enabler for the megatrends of digitalization and servitization (everything as a service). Companies across different industries still look for cloud-based solutions to digitalize and automate their operations to provide greater agility to the business, improve end-user experiences, and to save costs. With our Conversational AI offering we are well set to compete against the global goliaths as AI solutions emerge in the Service Management space.

The move from on-premises software to cloud will also continue. While cloud adoption amongst enterprises in the Nordics is over 70%, cloud adoption in the rest of Europe is still below 50%. Service management solutions are extremely sticky, with replacement cycles often being five years or longer.

Our estimate of the total current cloud ITSM and ESM market size in Europe is 1.5 billion euro, the IGA market 1.6 billion euro and the Conversational AI market 1.6 billion euro. Analyst estimates for compound annual growth for the next five years are still generally in the double digits for all these markets. Especially in service management, the market is today being divided by a few strong global players and a larger number of smaller local vendors.

We continue to see European customers prioritize privacy, security and data location more than before, especially in the public sector. With our competitive solution offering combined with flexible cloud deployment models, we have a significant opportunity to meet that demand and serve those customers.

While the macroeconomic environment pushes organizations to save costs, digitalization is still on top of their agenda. With a compelling total cost of ownership Efecte can help organizations to digitalize and automate their business processes in a cost-efficient manner.

RESEARCH AND DEVELOPMENT

During the second half, we continued to evolve our product guided by our long-term vision and the three strategic themes set for the year: Work Smarter with AI, Easier to Use and Faster to Start & Maintain.

In the AI space, the year was truly transformational for us. With the launch of Effie AI, we introduced new innovative AI capabilities at the heart of the Efecte platform to enable our customers to work smarter. Support organizations face increased workloads and complexity, and their existing tools have not been able to keep up. As a result, the average cost per contact has been increasing. This is where Effie AI helps: it is a personal assistant that knows the IT domain and helps end-users to resolve more situations independently and agents to manage their tasks more efficiently. We ended the year with Effie AI Email successfully piloted and a new Efecte-hosted language model (Efecte GenAI) released for piloting.

With Easier to Use, our goal is to help customers improve their employees’ experience and NPS (Net Promoter Score) by providing modern, intuitive, and easy-to-use user interfaces for both the end-users consuming services and the agents supporting them. During the second half, we continued to systematically progress on both of our main product initiatives: New self-service and renewed Agent UI. On new self-service, we integrated AI capabilities, expanded the search, introduced an easy-to-use admin panel and brought numerous enhancements to the end-user presentation layer. We have seen a steady increase in customers who have started to test the new self-service, with the first in production use already since the first half. With the renewed Agent UI agents can already take care of basic daily support tasks. With numerous tangible usability improvements, integrated AI and updated look and feel, including also a dark theme, we are starting to see the vision for a modern and cool Efecte user interface turn into reality.

With Faster to Start & Maintain, we want to systematically improve our platform for faster time-to-value and reduced operational costs. During the second half, we had a landmark milestone with the launch of ITSM Essentials. It is a new entry-level product that allows organizations to get going quickly and cost effectively with a set of essential ITIL-compliant IT processes. With ITSM Essentials, customers don’t need to spend time defining requirements, but instead can enjoy a best-practice solution that reduces cost, risk and adoption time. We also continued to improve our IGA packages, guided by our vision to simplify a process that is inherently complex for many organizations. During the second half, we saw this work bear results, with several new IGA customer wins and new IGA packages delivered more efficiently than before.

Efecte’s total research and development investment during the review period was 5.5 million euro (4.4). Research and development costs amounted to 3.8 million euro (3.1). In addition, 1.3 million euro (1.3) was capitalized, and 0.3 million euro (0.0) was covered through public funding (comparison period amounts excluding InteliWISE).

Research and development actions are performed in Efecte Finland Oy, InteliWISE S.A and its subsidiaries in Poland. In addition to our own personnel, subcontractors were used to increase flexibility and cost efficiency.

Group’s research and development investment level in 2021-2023:

ANNUAL GENERAL MEETING AND GOVERNANCE

The Annual General Meeting held on 22 March 2023 adopted the financial statements for 1 January - 31 December 2022 and discharged the members of the Board of Directors and the CEO from liability. The Annual General Meeting decided that no dividend is distributed for the year 2022.

The Annual General Meeting decided that the annual remuneration remains unchanged and is EUR 45,000 for the Chair of the Board and for the other members of the Board of Directors EUR 25,000 each. Approximately 40% of the remuneration was paid in Efecte Plc’s shares and approximately 60% in cash.

Esther Donatz, Pertti Ervi, Turkka Keskinen and Eric Gustavsson were re-elected as members of the Board of Directors, and Panu Hanula was elected as a new member of the Board of Directors. The organizational meeting of the Board of Directors elected Pertti Ervi as the Chair of the Board of Directors.

BDO Oy was elected as the auditor, with Taneli Mustonen as the auditor in charge.

The meeting decided that Article 9 of the articles of association of the Company is amended to enable holding a general meeting entirely without a meeting venue as a so-called remote meeting in addition to the Company’s domicile Espoo or in Helsinki as currently provided in the articles of association.

As announced simultaneously with this Financial Statements Bulletin, the Annual General Meeting 2024 is planned for 16 May 2024.

SHARES AND TRADING

The company has a one share series, and all shares carry equal rights. At the end of the review period, Efecte Plc's share capital consisted of 6 452 424 shares. The company owned 5 882 treasury shares, approx. 0.1% of the total amount of the shares.

The company's share has been trading on the Nasdaq First North Growth Market Finland marketplace. During the review period the highest share price was 11.90 euro, the lowest price 6.70 euro and the closing price 8.20 euro. The market value of shares was 52.9 million euro at the end of the period excluding the treasury shares.

SHAREHOLDERS

The company had a total of 2 713 owners on 31 December 2023 (2 657). The list of the largest owners and the distribution of shareholders can be found on the company's web site.

10 largest shareholders as of 31 December 2023:

The ownership of the Board members, CEO and their controlled entities totaled approximately 2.3% at the end of the reporting period. Additionally, the options held by the CEO entitle him to subscribe shares representing approximately 2.7% of the outstanding shares.

The total proportion of nominee registered shares was approximately 26.1 % of all shares.

THE AUTHORIZATIONS GIVEN TO THE BOARD OF DIRECTORS

The Annual General Meeting held on 22 March 2023 authorized the Board of Directors to decide to acquire the company's own shares with distributable funds. A maximum of 450 000 shares may be acquired. The authorization is effective until the next Annual General Meeting, however, at the latest until 30 June 2024.

The Annual General Meeting held on 22 March 2023 authorized the Board of Directors to issue a maximum of 620 000 shares through a share issue and/or by issuing option rights or other special rights entitling to shares referred to in Chapter 10 Section 1 of the Limited Liability Companies Act. The Board may decide to issue new shares or shares held by the company. The authorization includes the right to issue shares and option rights and/or other special rights entitling to the shares through private offering, in other words, to deviate from the shareholders’ pre-emptive right subject to the requirements set forth in the Limited Liability Companies Act. In addition, the authorization includes a right to issue shares and option rights and/or other special rights entitling to shares with or without payment. Under the authorization, the Board of Directors will be entitled to decide on the terms and conditions of any share issue and the issuance of option rights and other special rights entitling to shares, including the recipients and the remuneration to be paid. The authorization is effective until the next Annual General Meeting, however, at the latest until 30 June 2024.

OPTION PROGRAMS

Option program 2018

Option program 2018 consists of 450 000 options that entitle the holders to subscribe one share per option.

The options are divided to three series: A, B and C series. Series A consists of 170 000 options (of which 163 750 allocated and all of which subscribed) with subscription price of 5.75 euro/share and subscription period of 2 May 2021 - 31 May 2022; series B of 140 000 options (of which 134 325 allocated and 56 500 subscribed) with subscription price of 5.00 euro/share and subscription period of 2 May 2022 - 31 May 2024; and C series of 140 000 options (of which 140 000 allocated and 42 750 subscribed) with subscription price of 4.39 euro/share and subscription period of 2 May 2023 - 31 May 2025.

In connection with the 2018 option program, the Board of Directors has set a share-ownership requirement for the participants.

Option program 2021

Option program 2021 consists of 450 000 options that entitle the holders to subscribe one share per option. During the reporting period, the Board of Directors resolved to amend the terms and conditions of the stock option plan 2021 so that the stock options held by Efecte Plc from the stock option series 2021A will be transferred to a new stock option series 2021A1 and the stock options held by Efecte Plc from the stock option series 2021B will be transferred to a new stock option series 2021B1.

The stock options 2021 are divided to five series: A, A1, B, B1 and C. Series A consists of 118 650 options (of which 118 650 allocated) with subscription price of 15.55 euro/share and subscription period of 2.5.2024 - 31.5.2026; series A1 consists of 31 150 options (of which 24 000 allocated) with subscription price of 15.55 euro/share and subscription period of 2.5.2026 - 31.5.2028, B series of 130 145 options (of which 128 145 allocated) with subscription price 11.23 euro/share and subscription period of 2.5.2025 - 31.5.2027; B1 series of 19 855 options (of which 19 500 allocated) with subscription price 11.23 euro/share and subscription period of 2.5.2026 - 31.5.2028; and C series of 150 000 options (of which 141 000 allocated, for part of which the final allocation decision is pending fulfilment of share ownership requirement) with subscription price 10.31 euro/share and subscription period of 2.5.2026 - 31.5.2028.

In connection with the 2021 option program, the Board of Directors has set a share-ownership requirement for the participants.

EVENTS AFTER PERIOD-END

On 18 January 2024, Matrix42, a portfolio company of Corten Capital, acting through European 24 Bidco Oy, announced a voluntary recommended public cash tender offer for all the outstanding shares and stock options in Efecte Plc. In connection with the announcement of the tender offer, the Board of Directors of Efecte provided preliminary information on its key figures for 10-12/2023 and financial guidance for the full year 2024 to ensure equal access to information for all shareholders in connection with the public tender.

On 29 January 2024, the Board of Directors of Efecte issued its statement regarding the voluntary recommended public cash tender offer announced on 18 January 2024, concluding that the tender offer is under the prevailing circumstances fair to Efecte’s shareholders and holders of stock options and recommended unanimously that the shareholders and holders of stock options accept the tender offer.

Simultaneously with this Financial Statements Bulletin, the Company announced that in deviation to the initially scheduled date of 14 March 2024, the Annual General Meeting 2024 of the Company will be organized on 16 May 2024.

ASSESSMENT OF RISKS AND UNCERTAINTIES

Efecte manages the risks and uncertainties facing its operations and all material risks are reviewed quarterly in the leadership team and at least annually with the Board of Directors. The key risks identified include:

• Risks to data security such as non-intentional or intentional data breaches, including software vulnerabilities, denial of service attacks as well as phishing and ransomware attacks may cause reimbursement liabilities to customers or other third parties as well as financial losses or significant reputational harm. Tightening geopolitical situation may increase this risk
• Uncertainties in the macroeconomic and geopolitical environment, including an increase in energy costs, supply chain issues, and slowdown in cross-border trade could result in a prolonged recession in Efecte’s key markets. A recession could slow down customer decision-making and reduce customer demand.
• Malfunctioning of the software or failures in operating the company’s own services or the outsourced computing capacity and network connections may cause disruptions in services that may lead to reimbursement liabilities, reputational harm and to a decrease in customer satisfaction. This could lead to decreases in net sales and profitability.
• The company configures its products to operate with the customer's existing systems. Delays or unexpected warranty work related to customer projects may create costs and liabilities. Although most of the projects are time and materials based, there are also fixed price projects. Potential customer dissatisfaction could result in compensation claims, negative publicity, and loss of future business.
• The rate of inflation has increased substantially over the past years. While most of our customer agreements allow Efecte to increase pricing, some customer agreements especially in the public sector limit our pricing power. Inflation and higher interest rates also increase costs and may limit our capacity to acquire funding for M&A or other growth investments on terms favorable to Efecte.
• If the company is unable to recruit and retain key employees, the quality of its products and services may decrease, which can decrease revenue and profitability. Part of the research and development and service delivery are provided through subcontractors. If the operations of the subcontractors are disrupted, the effect is equivalent to a lack of skilled personnel.
• The company is pursuing mergers and acquisitions (M&A) as part of its strategy and concluded two acquisitions in 2022-23. Risks relating to M&A include failure in the integration of the acquired business, failure to retain key personnel, failure to meet forecasted financial performance as well as claims, disputes and litigation relating to the transaction.
• Investments in international growth such as forward-looking recruitments and ongoing investments in the partner program increase fixed costs. The costs may decrease profitability, if achieving growth turns out to be harder or slower than expected.
• Risks relating to intellectual property rights (IPRs) such as the loss/leaking of own IPRs to others, and breaches of third-party IPR by Efecte are material for Efecte. Efecte seeks to minimize the risk with strict control of customer agreements and with careful evaluation of third-party software components taken into use.
• Efecte has entered into agreements with its customers concerning the processing of personal data. A failure to comply with contractual obligations in these agreements, or the requirements of the General Data Protection Regulation more broadly, may lead to significant liabilities or reputational harm.
• Efecte operates in several jurisdictions and has customers and other business partners also in additional jurisdictions outside these. Exposure to different legal and tax frameworks heighten the risk of perceived or real non-compliance.
• The company’s equity and cashflow are at a sufficient level if the profitability development continues the planned trajectory. If changes in the operating environment or other factors would weaken the company’s outlook, the company may have to take measures on terms that are not favorable to the company.

PROFIT DISTRIBUTION PROPOSAL

The net profit of the parent company was -371 105.68 euro for the period and the distributable equity of the parent company was 8 604 747.86 euro. The Board of Directors proposes that no dividend is distributed from the financial period of 2023 and the profit is left in equity.

According to its strategy, Efecte will invest substantially in growth in the next few years, due to which the company does not aim to pay dividends for the foreseeable future.

LONG-TERM FINANCIAL TARGETS

By 2025, grow organically to 35 MEUR total net sales, maintain an average SaaS growth of over 20% and reach a double-digit EBITDA margin.

Through organic growth and acquisitions, become eventually the largest European service management vendor with total net sales over 100 MEUR and EBITDA margin exceeding 25 %.

Guidance for 2024:

In 2024, Efecte’s net sales are expected to be approximately EUR 25 – 30 MEUR, SaaS net sales is expected to grow over 15% and adjusted EBITDA margin is expected to be 3 – 9 %.

NEXT EARNINGS RELEASE

Efecte will publish a business review for 1-3/2024 on 7 May 2024.

Efecte Plc
Board of Directors

Additional information:
Interim CFO Tommi Mäkinen, +358 40 042 1659
CEO Niilo Fredrikson, +358 50 356 7177

Certified adviser: Evli Oyj, tel. +358 40 579 6210

The Company will publish the Report of the Board of Directors and the complete Financial Statements for 2023 simultaneously with this announcement as a separate release. They are also available on the Company's website at https://investors.efecte.com/.

A webcast for analysts, investors and media will be arranged on Thursday 15 February 2024 at 11:30 Finnish time. Everyone interested can follow the webcast online at https://efecte.videosync.fi/q4-2023. The webcast will be held in English and written questions can be presented in the webcast portal. A recording of the webcast and presentation materials will be made available afterwards on the company’s investor pages at investors.efecte.com.

Efecte Plc

Efecte helps people to digitalize and automate their work. Customers across Europe leverage our cloud service to operate with greater agility, to improve the experience of end-users, and to save costs. The use cases for our solutions range from IT service management and ticketing to improving employee experiences, business workflows, and customer service. We are the European Alternative to the global goliaths in our space. Our headquarters is located in Finland and we have regional hubs in Germany, Poland, Spain and Sweden. Efecte is listed on the Nasdaq First North Growth Market Finland marketplace.

www.efecte.com

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Financial information:

1.     Consolidated income statement, balance sheet, cash flow statement and statement of changes in equity.

2.     Notes

3.     Key figures

4.     Calculation of key figures

1. Consolidated income statement, balance sheet, cash flow statement and statement of changes in equity.

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED BALANCE SHEET

SUMMARY CONSOLIDATED CASH FLOW STATEMENT

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

2. Notes           

2.1 Basis of preparation

This interim report has been prepared in accordance with the FAS recognition and measurement principles.

2.2 Net sales by type

2.3 Development of number of shares

On 31 December 2023 Efecte Plc owns 5 882 treasury shares, approx. 0.1% of the total amount of the shares.

2.4 Commitments

The following tables present the company's commitments not in the balance sheet on 31 December 2023 and 31 December 2022.

Lease agreements for computer equipment are mainly three-year lease agreements, and the equipment can be purchased at the end of the period with approx. 2-5% remainder value.

Other commitments

Parent company Efecte Plc has a fixed-term office lease agreement of which first possible expiration date is 28.2.2026. The company’s lease liability from this contract is approx. 641 thousand euro.

3. Key figures

4. Calculation of key figures