Enento Group Oyj: Enento Group's Financial Statement Release 1.1. - 31.12.2020: A year of growth in spite of COVID-19 as new services create future growth potential

ENENTO GROUP PLC, STOCK EXCHANGE RELEASE 12 FEBRUARY 2021 AT 12.15 EET

Enento Group's Financial Statement Release 1.1. - 31.12.2020: A year of growth in spite of COVID-19 as new services create future growth potential

SUMMARY

October - December 2020 in brief

• Net sales amounted to EUR 40,2 million (EUR 39,2 million), an increase of 2,6 % (at comparable exchange rates an increase of 0,9 %).
• Adjusted EBITDA excluding items affecting comparability was EUR 14,4 million (EUR 13,6 million), an increase of 5,5 % (at comparable exchange rates an increase of 3,7 %).
• Adjusted EBIT excluding items affecting comparability and amortisation from fair value adjustments related to acquisitions was EUR 11,9 million (EUR 11,6 million), an increase of 3,1 %.
• Operating profit (EBIT) was EUR 6,1 million (EUR 7,8 million). Operating profit included items affecting comparability of EUR 5,9 million (EUR 3,8 million), mainly arising from amortisation from fair value adjustments of EUR 3,1 million (EUR 3,0 million) related to acquisitions as well as additional purchase price relating to Proff acquisition based on Arbitration Court ruling and legal fees.
• New products and services represented 6,8 % (4,4 %) of net sales.
• Free cash flow amounted to EUR 9,1 million (EUR 6,9 million). The effect of items affecting comparability on free cash flow was EUR -2,4 million (EUR -0,7 million).
• Earnings per share were EUR 0,15 (EUR 0,23).
• Comparable earnings per share were EUR 0,25 (EUR 0,32)¹.

January - December 2020 in brief

• Net sales amounted to EUR 151,3 million (EUR 146,0 million), an increase of 3,7 % (at comparable exchange rates an increase of 3,2 %).
• Adjusted EBITDA excluding items affecting comparability was EUR 54,0 million (EUR 51,5 million), an increase of 4,8 % (at comparable exchange rates an increase of 4,3 %).
• Adjusted EBIT excluding items affecting comparability and amortisation from fair value adjustments related to acquisitions was EUR 45,0 million (EUR 42,6 million), an increase of 5,5 %.
• Operating profit (EBIT) was EUR 27,8 million (EUR 27,8 million). Operating profit included items affecting comparability of EUR 17,1 million (EUR 14,8 million), mainly arising from amortisation from fair value adjustments of EUR 12,3 million (EUR 11,6 million) related to acquisitions, additional purchase price relating to Proff acquisition based on Arbitration Court ruling as well as M&A and integration expenses.
• New products and services represented 5,6 % (4,0 %) of net sales.
• Free cash flow amounted to EUR 32,6 million (EUR 32,1 million). The effect of items affecting comparability on free cash flow was EUR -4,4 million (EUR -2,7 million).
• Earnings per share were EUR 0,81 (EUR 0,82).
• Comparable earnings per share were EUR 1,21 (EUR 1,20)¹.

¹ The comparable earnings per share does not contain amortisation from fair value adjustments related to acquisitions or their tax impact.

KEY FIGURES

EUR million	1.10. - 31.12.2020	1.10. - 31.12.2019	1.1. - 31.12.2020	1.1. - 31.12.2019
Net sales	40,2	39,2	151,3	146,0
Net sales growth, %	2,6	9,1	3,7	48,7
Operating profit (EBIT)	6,1	7,8	27,8	27,8
EBIT margin, %	15,1	19,8	18,4	19,0
Adjusted EBITDA	14,4	13,6	54,0	51,5
Adjusted EBITDA margin, %	35,7	34,7	35,7	35,3
Adjusted operating profit (EBIT)	11,9	11,6	45,0	42,6
Adjusted EBIT margin, %	29,7	29,5	29,7	29,2
New products and services of net sales, %	6,8	4,4	5,6	4,0
Free cash flow	9,1	6,9	32,6	32,1
Net debt to adjusted EBITDA, x	2,6	2,7	2,6	2,9

FUTURE OUTLOOK

Net Sales: Enento Group expects its net sales growth in 2021 to be in the long-term target range (5-10%) but somewhat lower than the mid-point of the target range.

EBITDA: Enento Group expects its adjusted EBITDA margin to improve somewhat in 2021 compared to previous year.

Capital Expenditure: Enento Group expects its capitalised product development and software expenses in 2021 to exceed the previous year's level.

The Outlook is based on the assumption that exchange rates remain at the current level.

JUKKA RUUSKA, CEO

Surprisingly, 2020 was a very different year than what we expected. The COVID-19 pandemic made its way to our home markets in March and affected Enento Group's operating environment during the financial year. In spite of this, we made progress in line with our targets with regard to the launch of new services during the financial year, and we remained on the path of growth. New services represented 6,8 % of net sales in the final quarter of the year, compared to 4,4 % in the corresponding period last year.

We launched more than 50 new services in 2020. In line with our strategy, we have focused on the development of services that are based on new data elements, assisting our clients in digitalising their processes and enhancing their ability to respond to the changing challenges in the operating environment. We launched many excellent services, a few of which will be highlighted here. For example, in the Swedish market, we have launched ID Protection for Companies, a service that monitors changes in the basic information and financial information of companies and creates alerts of such changes. These alerts enable companies to maintain awareness of changes to the registration data pertaining to their business and they can also help identify potential fraud attempts. We also quickly launched new services related to the COVID-19 situation and increased our financial communication. To help our customers make decisions based on accurate information, we began recording notes in businesses' payment default entries in the Finnish market indicating that the COVID-19 pandemic was a factor in the payment default.

Our focus areas in future service development will include, for example, the development of Nordic sustainability services and the digitalisation of housing-related processes. The goal of our Nordic sustainability services is to help our customers make sustainable decisions. We want to be a leading provider of ESG services with a comprehensive range of sustainability services that are needed by customers for risk management, credit processes, procurement and customer management. In the digitalisation of housing-related processes, our focus is on the development of housing transaction services. We particularly focus on information services required by real estate agents and banks concerning apartments as well as the automation of the processes involved in housing transactions.

In the fourth quarter of the financial year 2020, Enento Group's net sales amounted to EUR 40,2 million, representing a year-on-year increase of 2,6 % (at comparable exchange rates 0,9 %). Adjusted EBITDA increased by 5,5 % (3,7 %) and amounted to EUR 14,4 million. The Group's adjusted operating profit excluding items affecting comparability grew by 3,1 % (at comparable exchange rates 1,3 %) and amounted to EUR 11,9 million. The Group's net sales were supported by newly launched services in our main markets. Their share of net sales continues to grow, amounting to 6,8 % of in the fourth quarter.

The positive development of net sales in both markets was supported by the higher demand of business information services in the Risk Decisions business area, although the total net sales of the business area decreased in both markets as the decline in economic activity reduced the use of our services. The property information services and compliance services of the Digital Processes business area saw continued strong growth in both markets, supported by service development and strong market demand. In the SME & Consumers business area, growth was achieved in both markets in services sold directly to consumers, but the total net sales were lower than in the comparison period. The net sales of the Customer Data Management business area were slightly higher than in the previous year thanks to the good growth of consumer-related services.

On 14 January 2021, we announced a change in our business area structure effective from 1 April 2021. The new organisational structure consists of three business areas as well as a functional unit called Data and Analytics. The change in the organisational structure is aimed at enabling faster and smoother strategy implementation and highlighting the importance of data and analytics.

The COVID-19 pandemic has affected our business starting from the second quarter. We took steps in a timely manner to prepare for the prolongation of the exceptional circumstances and began to proactively secure our business. We established four COVID-19 working groups that assessed the prevailing situation from different perspectives. The health and safety of our employees is our top priority. Starting from mid-March, the employees of all of our offices have worked remotely if their duties allow it. In the business continuity group, we updated and tested comprehensive business continuity plans to ensure their effectiveness in all circumstances and at all times. In the financial COVID-19 working group, we secured our business by ensuring financial sustainability and short-term cash flow. The programmes we prepared have been effective.

While virtual interaction is undoubtedly here to stay, we must not underestimate the importance of face-to-face interaction. Live meetings are important for maintaining relationships and building trust. We hope that we will soon return to circumstances where this is again possible.

NEWS CONFERENCE: WEBCAST AND CONFERENCE CALL

Enento Group will hold a webcast for analysts, investors and media in English on Friday, 12 February 2021 at 2.00 p.m. EET where CEO Jukka Ruuska and CFO Elina Stråhlman will present the performance and events of the fourth quarter 2020.

You can follow the English webcast and conference call at:
https://cloud.webcast.fi/enento/enento_2021_0212_q4

To participate in the conference call, please dial in using one of the numbers below:
Finland: [phone]
Sweden: [phone]
United Kingdom: [phone]
United States, LA: [phone]
United States, NY: [phone]
The conference ID code: 984174

The presentation material will be available on the company's investor website at 1.30 p.m. EET and a recording of the webcast later during the day.

Helsinki, 12 February 2021

ENENTO GROUP PLC
Board of Directors

For further information:
Jukka Ruuska
CEO
Tel. [phone]

Distribution:
Nasdaq Helsinki
Major media
enento.com/investors

Enento Group is a Nordic knowledge company powering society with intelligence since 1905. We collect and transform data into intelligence and knowledge used in interactions between people, businesses and societies.?Our digital services, data and information empower companies and consumers in their daily digital decision processes, as well as financial processes and sales and marketing processes. Approximately 425 people are working for Enento Group in Finland, Norway, Sweden and Denmark. The Group's net sales for 2020 was 151,3 MEUR. Enento Group is listed on Nasdaq Helsinki with the trading code ENENTO.

Attachment

• Enento Group Plc_Financial Statements Release 2020_120221 (https://ml-eu.globenewswire.com/Resource/Download/7bc37f88-48e8-49f5-9f25-23c681abfa20)