Recurring revenue continues to grow while churn remains at 0%

Interim Report October 1st – December 31th, 2020

 

• Despite a quarter with lead times affected by the pandemic, the Annual Recurring Revenue
(ARR) increased with +37% year-on-year, to 23,8 MSEK.
• The transformation in 2020 came to full completion in the fourth quarter. On a full-year basis
recurring revenues accounted for 90% of total revenues.
• Churn in Q4 remains at 0%.
• On January 25th, Safeture carried out a directed share issue of 4,6 million shares worth 38,6
MSEK in new cash.

Summary of Interim Report

The Group

Full Year (2020-01-01 to 2020-12-31)

• Net turnover amounted to 21 541 (17 877) TSEK, an increase of +20,5% compared to the same period last year. (Last year’s sales figures have been adjusted with 5 001 TSEK to reflect the divestment of Travelogix Ltd in Q3 2019.)
• Net turnover before adjusting for the divestment amounted to 21 541 (22 878) TSEK, a decrease of -5,8% compared to the same period last year.
• Loss after financials and minority share amounted to –25 472 (-17 094) TSEK. (Last year’s result have been adjusted with -2 307 TSEK to deduct the profit from the divestment of Travelogix Ltd in Q3 2019.)
• Loss after financials and minority share before adjusting for the divestment amounted to -25 472 (-14 787) TSEK.
• Loss per share* before dilution amounted to -1,05 (-0,64) SEK.
• Loss per share* after dilution amounted to -0,96 (-0,58) SEK.

Fourth quarter (2020-10-01 to 2020-12-31)

• Net turnover amounted to 6 378 (6 746) TSEK, a decrease of -5,5% compared to the same period last year.
• Loss after financials and minority share amounted to -8 628 (-3 566) TSEK.
• Loss per share* before dilution amounted to -0,34 (-0,15) SEK.
• Loss per share* after dilution amounted to -0,31 (-0,14 SEK. The solidity** amounted to 30,6 (47,8) %.

“Parent company” or “Safeture”, comprises of Safeture AB with company number 556776-4674, without subsidiaries. “The Group” comprises the Parent company, including subsidiaries. On June 30^th, 2020, the Parent company owned 100% of the shares in GWS Production (Singapore) Pte Ltd, 99,99% of the shares in GWS do Brasil Solucões e Sistemas Tecnológicos em Seguranca Ltda and 35% of the shares in Carefindy AB (minority interest).Amounts within brackets regard the corresponding period last year.*Result per share: The result is divided by the average number of shares (after dilution includes average number of share options).**Solidity: Equity divided by total assets.

Growing SaaS Traction

Fourth quarter (2020-10-01 to 2020-12-31)

• Recurring revenue amounted to 5 422 (4 347) TSEK, which represents 85% (64%) of the quarterly revenue.
• Annual recurring revenue (ARR) at the end of Q4 2020 was 23 848 (17 388) TSEK, a year-on- year increase of +37%.
• Churn for the quarter was 0%.

Significant events during the fourth quarter, 2020.

• Safeture announced a partnership with Sweden-based Safehotels to provide users of Safeture’s software platform with flagged locations of certified hotels around the world.
• Safeture signed yet another contract with the UK partner Special Projects and Services Limited (SPS) worth 194 KUSD. The partnership with SPS has generated a total contract value of 840 KUSD during 2020.
• Safeture AB in Lund has signed a 3-year agreement via partner with one of the largest financial institutions in the Netherlands. This is a significant breakthrough for Safeture on the Dutch market. The agreement is worth 220 KEUR.

• During Q4 Safeture has continued to invest in the European sales organization by hiring Marcel Brandt, a senior sales manager with a recent background as the CEO of German company A3M.

Significant events after the fourth quarter, 2020.

• On January 25th, Safeture carried out a directed share issue of 38,6 MSEK. 4,6 million shares was issued at a price of 8,40 SEK/share. The subscribers were the US-based institutional investor Topline Capital Partners LP, Dragfast AB and Ninalpha AB.

• Safeture partners with Dallas based corporate travel data leader Traxo. Safeture customers now can leverage Traxo travel data intelligence to quickly locate more traveling employees.

• Safeture announced that the leading travel management company BCD Travel has added the software firm to its SolutionSource marketplace to make safety a top priority to travelers all over the world.

Message from the CEO Magnus Hultman:

“Increased recurring revenues and zero churn”

Steady growth despite challenges

2020 for sure, was a strange year. Despite the challenges, Safeture has been able to successfully navigate this new business environment. Our ongoing efforts to position ourselves as an all- employee safety platform have served us well and as we close 2020, we conclude that we have managed to increase awareness as well as sales. Highlights of the year include the strengthened Software as a Service (SaaS) organization, new partnerships in Europe, Asia and the US and focused sales efforts on increasing our recurring revenues, making us better positioned to target the employee safety market once the pandemic gives away to a more normal situation.

Strong financial development of Q4 and 2020

Despite a pandemic and economic turbulence, Safeture’s total contract value increased by +400% and our ARR grew 37 % compared to Q4 2019. Throughout the year, the weighted sales pipe increased significantly. The last quarter of 2020 was characterized by uncertainty in the market due to COVID-19, which somewhat stalled and delayed sales. Recurring revenue for Q4 amounted to 5,4 MSEK compared to 2019 (4,3 MSEK). We expect sales to continue to increase as vaccines are rolled out and the world gets ready for a post-corona future.

Strategic contracts in prioritized markets

In terms of our direct sales, we have signed our first significant customer in the Benelux market. We also received our first order in China. The contract is strategically important as it concerns one of the biggest companies in China. Our strong partner network also contributed with many new customers. Partner sales made up 69 % of total sales during Q4 2020.

Moving forward

Moving forward, macro trends for security and employee safety as well as digitalization, will drive the demand for technology providers like Safeture. In a recently published report from Gartner the top strategic technology trends for 2021 include - People centricity, Location independence and resilient delivery. These trends all tap into the strengths of Safeture’s core offering of providing infrastructure for employee safety to large organizations and companies.

Creating awareness is necessary. In the past year, Safeture has invested heavily in marketing and sales and more than doubled the team. During Q4 we have seen an impressive increase in participation in webinars and engagement in our different channels.

We are pleased to welcome new investors on board after the end of the quarter. Through a direct new share issue, American institutional investors Topline Capital Partners LP along with Swedish private investors Dragfast AB och Ninalpha AB joined Safeture. The proceeds from the new share issue will be used to further accelerate the international expansion and increase the sales efforts directed towards existing customers and their employees.

As we put 2020 behind us, I conclude that we have increased awareness and strengthened our position as the best partner for employee safety, with the market’s broadest and most modern platform. With the new shareholders on board, we are ready to continue our growth journey!Magnus Hultman, CEO of Safeture Lund, February 2021

About Safeture AB
Safeture (founded in 2009) is a Software as a Service (SaaS) company based in Sweden.
The company offers a complete cloud-based platform designed to manage employee safety and risk/crisis management. Through world-leading technology and innovative solutions, Safeture helps companies and organizations to protect what matters most – their employees. Safeture corporations the ability to effectively automate safety and security while seamlessly integrating the software to become a natural part of their internal processes.
The Safeture share is listed on NASDAQ First North Growth Market Stockholm (ticker: SFTR). Erik Penser Bank AB is the Certified Adviser. Ph: +46 8-463 83 00 E-mail: [email protected]

This disclosure contains information that Safeture AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 26-02-2021 08:00 CET.