CYBER1 H1 2021 Report: Profitable CYBER1 Out Of Reconstruction

Summary Highlights
CYBER1 was able to achieve a number of positive developments, concluding H1 2021 with the formal completion of the reconstruction process, gaining legal effect from the 28th of June, 2021. 
 
• H1 Group revenue has remained constant while the Group grew gross margin by 3%, to 28% for the reporting period. This has been underpinned by additional services being added, including our new managed service offering.
 
• The strategic actions implemented to date have positively affected the company’s overall operating expenditure for H1 2021, resulting in a decrease of 32% to €4.1m, versus €6.1m in H1 2020. Following detailed analysis of company operations, the executive has implemented effective measures into the parent company and wider subsidiaries, ensuring tighter corporate governance controls. The wider benefits of these actions will lead to further investment into revenue generating opportunities for CYBER1, building greater scale and profitability as a result.
 
• As a result of the above factors, H1 2021 Group EBITDA equated to a profit of €387k, compared to a loss of €-1.9m in H1 of 2020. This change has been a result of greater operational efficiencies that have been realised during the reconstruction process throughout the last twelve months, in addition to improved margins on services and additional revenue streams.
 
Beyond the Quarter & Other News
• On May 17th 2021, CYBER1 announced that short term interim operating capital of 500k euros has been secured from existing shareholders. The lenders shall have the right, instead of cash repayments, to set off the loan claims against new shares and warrants on terms equal to the planned rights issue broadly outlined in a press release on 11th May 2021, where the rights issue is subject to certain developments around the composition filing and share-holders’ approval at an extraordinary shareholders’ meeting. The loan will constitute general rights of priority (Sw. allmän förmånsrätt) according to the Rights of Priority Act (Sw.förmånsrättslagen). Administrator Marcus Wenner, of the corporate restructuring proceedings, has approved the taking on of the loan by the Company.
 
• On May 27th, the CYBER1 announced subject to ratification at the AGM, resolved to carry out an issue of shares and warrants with preferential rights for existing shareholders of approximately EUR 1.774 million before issue costs. Upon full exercise of all warrants, the company may receive additional issue proceeds of approximately EUR 1.774 million before issue costs.
 
• On the 1st of June, CYBER1 appointed a new management structure, with Robert Brown being promoted into a newly created role of President, working closely with the board on strategy and commercials of the business. CYBER1 has appointed Peter Sedin as CEO, with a focus on our corporate governance structure, with a long-term view for business development within the Nordic markets. Following these appointment, Robert Brown was also appointed to the Board of Directors of CYBER1 at the AGM.
 
• On June 7th, the Stockholm District Court decided to adopt a compulsory composition agreement with a 75 percent debt write-down and to end the company reconstruction in CYBER1. The total amount subject to the compulsory composition agreement is 190,194,181.25 SEK. The write-down amount will be 14,176,378 EUR and a total of 4,725,454 EUR* is to be paid within one year as dividend to the creditors (based on 1 SEK=0.0993817 EUR). No such appeal was lodged within the three-week allotted period, making the composition legally binding as of the 28th of June 2021.
 
• On July 23rd, CYBER1 confirmed that the rights issue of units amounting to EUR 1.774 million which was made public on June 27, 2021 in Cyber Security 1 AB (publ), has been heavily oversubscribed. The subscription period ended on July 19, 2021. The Rights Issue was subscribed with 259 percent, of which approximately 94 percent was subscribed with unit rights and approximately 165 percent was subscribed without unit rights. Hence, the underwriting commitments will not be used. Through the Rights Issue, the Company obtains approximately EUR 1.774 million before issue costs.
 
Commenting on the publication of the report, Group President Robert Brown stated: I am delighted that CYBER1 has continued to further realise the potential success that we can achieve, based on strategic sales generation, and controlled and measure investment in costs to grow the business. This has been demonstrated in another profitable quarter for CYBER1 and a total half year EBITDA of €387k, a positive change of €2.35m year over year. The ending of CYBER1 formally being under reconstruction on the 28th of June, was a milestone moment for the company. Now, with the company able to set its own course once again, I am as enthused as ever to work with the business units and push the company to become a dominant player in the market for a variety of services and solutions.”

The report is enclosed to this release and can also be found on our website by clicking here.