Annual report 2022
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Annual report 2022
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Annual report 2022
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Annual report 2022
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Contents
This is Techstep
5
Key figures
9
Letter from the CEO
10
Executive management
13
Board of Directors
16
Board of Directors’ Report
18
Sustainability
28
Corporate governance report
50
Consolidated financial statements
58
Notes to the financial statements
65
Techstep ASA financial statements
119
Techstep ASA Notes to the financial statements
125
Alternative performance measures
137
Responsibility statement
143
Auditor’s Report
144
GRI Index
150
Annual report 2022
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This is Techstep
Techstep is a complete mobile technology enabler, making positive
changes to the world of work; freeing people to work more effectively,
securely, and sustainably.
Traditional boundaries of where and when we work are continuously being eroded. However, a lack of
digital maturity and legacy technology are still holding many businesses back.
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At Techstep we help customers who want to work smarter, while also delivering on their ESG
commitments. By bundling mobile devices, software, information security, and expertise, we help
customers to realise their organisations’ potential through deploying the right mobile work tools to the
right employees, ensuring more effective work and more engaged employees. By offering a complete
end-to-end device lifecycle handling, we enable full overview and cost control in relation to the
procurement and use, and secure second-hand use or recycling of mobile hardware.
Built on a decade of telecoms and mobile technology expertise, Techstep was established in 2016.
Through several acquisitions, we have consolidated and expanded into the Nordic and later European
markets adding IP, own software, and security expertise to the benefit of our customers. Our goal is to
be the leading European mobile technology enabler for customers that want to work smarter and
more sustainably.
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Our product offering
Often, organisations recognise the importance of mobile technologies, but lack the strategic and
operational expertise needed to succeed. With growing concern for work-life balance due to remote
and hybrid work, combined with rapidly evolving technology, there is even more need to manage
devices and technologies responsibly, in order to sustain growth.
At Techstep, we enable remote and frontline workers to perform smartly, securely and sustainably. We
combine mobile devices, software and services to meet customers’ business and ESG goals and our
experts proactively ensure that their mobile ecosystem is optimised for success.
We dare to challenge and transform mobile working practices to help customers increase
productivity, create a happier workforce and ultimately help them deliver an exceptional customer
experience.
SmartDevice is the complete and sustainable solution to help enterprises integrate and manage all
mobile devices from procurement to end of life. Users are empowered to choose, repair and replace
mobile devices whilst enterprises have visibility and cost control over their mobile fleet.
SmartControl experts deliver best practice implementations, support and proactive services. We
manage and secure the entire mobile ecosystem of your enterprise, by combining Apple and Google
Android knowledge and best in class software. This ensures that your devices and apps are always
compliant, secure and up-to-date.
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SmartWorks transforms everyday deskless working practices. By combining the right software,
hardware and services, we bring power to the fingertips of frontline workers – enhancing usability,
productivity and performance whilst reducing the environmental impact.
Techstep at a glance
Techstep’s headquarters are in Oslo, Norway. Our employees are working from different locations in
Norway, Sweden, Denmark and Poland, serving more than 2 000 enterprise customers throughout
Europe. The table below highlights Techstep’s financial performance in 2022.
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Our strategy
Strategic pillars
Techstep is transforming its business model from transactional revenue to a recurring revenue model.
This will enhance financial predictability for Techstep, while at the same time ensuring better value for
our customers by providing them with a continuous service rather than one-off transactions. This
leads to closer relationships with our customers and greater loyalty.
By redesigning and streamlining the product offering, we will win new customers and secure existing
ones by investing in our own IP, software, and mobility expertise, and continue to pursue M&A
opportunities to further add attractive capabilities and expand geographically.
Driven by value-creating services and economies of scale, as the company continues to grow, our
goal is to improve gross margins and profitability significantly over the long-term.
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Key figures
(Amounts in NOK 1 000)
FY 2022
FY 2021
Revenues
1 323 126
1 305 090
Annual Recurring Revenue (ARR) - Own Software
110 800
97 473
Net gross profit
1
367 279
367 618
EBITDA adjusted
2
85 466
69 616
EBITA adjusted
2
(23 756)
(38 613)
EBIT
(52 205)
(110 522)
Net profit (loss) for the period
(68 614)
(102 660)
EBITDA adj. margin (%)
6.5%
5.3%
EBITA adj. margin (%)
(1.8%)
(3.0%)
EBIT margin (%)
(3.9%)
(8.5%)
Net profit (loss) for the period (%)
(5.2%)
(7.9%)
Cash flow from operating activites
123 741
128 930
Cash flow from investment activities
(180 376)
(174 594)
Cash flow from financing activities
67 594
71 244
Cash and cash equivalents
61 119
50 350
Net interest-bearing debt
112 868
121 600
Capex
3
52 250
48 883
Employees
315
341
Refer to Alternative performance measures for definitions.
1) Net gross profit is defined as Toral revenue less Cost of goods sold and depreciation from Hardware-as-a-Service.
2) EBITDA adjusted and EBITA adjusted in 2022 excludes non-recurring items such as M&A and restructuring related costs of NOK
10.0 million and structural gains from sale of NOK 40.1 million
3) Capex includes software development and IT-related capex, and not hardware-as-a-service to customers, booked as capex
under IFRS 16.
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We are making the world of work smarter
and more sustainable
Dear investors and stakeholders,
2022 was a challenging year for Techstep, as balancing growth while
transforming the business proved harder than anticipated. The result showed a
relatively flat development in both revenue and gross profit for 2022, clearly an
outcome we are not satisfied with. At the same time our transformation towards
a recurring services business model is materialising, and our 2022 recurring
revenue base grew by 14%.
2022 was also
the most product launch intensive year on record, providing us
with a solid platform for growth. The combination of a new scalable product
platform and implementation of a NOK 90-100 million cost optimisation
programme, makes me very confident that we will turn Techstep profitable and
deliver on our ambitious targets. We believe the turning point will start in 2023.
New product portfolio creating a
platform for growth
A very important step in the right direction in
2022 was the transformation of our product
offering. During the year we have successfully
commercialised and standardised our product
portfolio, moving from 47 different products to
7 products and 3 distinct product portfolios.
Years of investing in our own software and IP,
has resulted in the most launch intensive year
on record. The majority of the launches were in
the second half of 2022 and there are still a few
to come in the first half of 2023.
Naturally, the positive financial effects of these
new products have not yet materialised.
However, now we have a solid platform for
growth and will reap the benefits of these
investments in the coming years. We are
intensifying our go-to-market strategies and
are optimistic when we see a growing
customer demand for our solutions, evident in
large frame agreements and tenders. Even the
current challenging macroeconomic
environment might benefit us, as we have
compelling cost-efficient solutions to offer the
customers, with clear and significant direct
and indirect cost savings.
Transformation journey
Techstep has gone through a comprehensive
transformation process in recent years, going
from a transactional hardware provider to a
software-driven mobile technology enabler
with a recurring services business model. We
will lead with software in our value-based
proposition, with a positive tag-along effect on
Hardware and Advisory & Services.
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To be able to execute and unleash the
potential, and deliver great value to our
customers and shareholders, we have also
restructured and optimised the organisation to
become One Techstep. We have moved from a
silo-based organisational structure to one
integrated company. We have consolidated
systems and product portfolios, to extract
synergies and enable scalable growth. We
have a new management team in place,
driving our transformation towards a software
driven recurring business model.
2022 was a year of large transformation, and
even though we will never be fully done
transforming, we now see a more gradual shift
towards continuous improvements. Techstep
is in the final phase of the transformation, and
through this, we have achieved a unique
position and product offering that gives us a
competitive advantage in the managed
mobility market. It is time to reap the benefits
of all the hard work, effort and investments that
have been put in.
Turning Techstep profitable
2022 was all about getting the fundamentals
and right structures in place, setting us up for
future success. Now, it is all about execution.
We are committed to turning Techstep
profitable in 2023, returning value to our
patient shareholders and employees. In this
phase, we are focusing on optimising the cost
base and aligning the company to the
simplified product portfolio. This includes
extracting synergies from the acquired
companies, further automating the business
processes and streamlining operations.
This is also why we in 2022 announced and
initiated a NOK 90-100 million cost optimisation
programme. This was largely effectuated in the
latter part of the year, and as such had limited
financial effect during 2022.
In September 2022 we raised NOK 103 million in
a private placement, to fund the final phase of
the transformation process, as well as to
strengthen the balance sheet. This, in
combination with the cost optimisation
programme and new platform for growth,
allowed us to raise our ambitions. During 2022
we announced our 2025 ambition to reach
more than NOK 150 million in EBITA adjusted,
and more than double the size of revenue from
our Own Software portfolio, and we believe the
turning point will be in 2023.
Clear mission for positive change
We passionately believe that our mobile
technology solutions will drive positive change
for organisations, while supporting them to
deliver on their ESG commitment. Mobile
technology makes employees happier and
more productive by freeing them to work
smarter. By making our solutions sustainable,
we’re fulfilling our responsibility to future
generations. We will translate this into
commercial success stories for our customers,
and for Techstep. Please dive deeper into our
sustainability efforts in the ESG section of this
report, to learn more about the progress we are
making and initiatives we have taken.
Overall, the main goal remains clear - to be the
leading European mobile technology enabler
for customers that want to work smarter and
more sustainably.
Rounding off, I would like to take the
opportunity to thank all my colleagues in the
company for their invaluable efforts in a tough
and transformative year, and our shareholders
for their patience through this journey.
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Executive Management
From the top, left: Mads Vårdal, Børge Astrup, Fredrik Logenius, David Landerborn, Bartosz Leoszewski and Ellen
Solum. From the bottom, left: Ellen Skaarnæs, Anita Huun and Sheena Lim.
Børge Astrup – Chief Executive Officer
Mr Astrup is a business leader committed to creating a winning working environment and a culture
that delivers by engaging and embracing diversity. He uses goal-oriented methodologies, technology
and commercial models, to drive fast, focused and uncomplicated market delivery. Mr Astrup comes
from the position as CEO of Puzzel, a fast-growing cloud contact centre software (CCaaS) company
with an industry-leading product platform. Puzzel operates in eight countries, has a global customer
base, over 200 employees and annual revenue exceeding USD 40 million. He led Puzzel's demerger
from Intelecom Group, a Norwegian telecom, contact centre and mobile services provider, launching
Puzzel as a stand-alone company. Prior to the demerger, Mr Astrup was the managing director of
Intelecom Group. He has also held various management positions at Visma, the leading European
provider of core business software. Mr Astrup has a bachelor’s degree in marketing with specialisation
in management from BI Norwegian Business School.
Ellen Solum – Chief Financial Officer
Mrs Solum joined Techstep from the role as Partner in Uniconsult AS, and brings extensive experience
from all finance functions, such as accounting, tax, controlling, treasury and investor relations and
significant experience from change management, turn-around cases and IPO processes. She has
worked in both private and publicly listed companies and has previously held positions such as CFO
in TeleComputing ASA, Finance Director in Findus AS, as well as several years as management
consultant and partner. Mrs Solum holds a bachelor’s degree from University of Colorado Boulder, as
well as an MBA from the Norwegian School of Economics (NHH).
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Anita Huun – Chief Commercial Officer
Ms Huun has a broad background from the IT industry and capital markets in Norway. Ms Huun joined
Techstep in 2022, first as CFO before taking on the role as Chief Commercial Officer to lead the
transition to a software led recurring revenue business model and capitalise on the growth prospects
of the company’s new product portfolio. Previous experience includes CFO of Cappelen Damm, CFO
at Microsoft Norway, as well as sell side equity analyst for Handelsbanken Capital Markets covering
the Norwegian IT sector. Ms Huun is currently a board member of Nordic Semiconductor. She has a
MSc from the Norwegian School of Economics (NHH), with specialisation in finance.
Sheena Lim – Chief Marketing Officer
Ms Lim has over 22 years of international brand, marketing and communication experience from the
telecom, food & beverage, media, pharmaceutical and tech sectors. Ms Lim has an MBA from BI
Norwegian Business School and also a Bachelor of Business in Marketing with Monash University,
Australia. She grew up in Malaysia and Singapore, where she started her career with assignments for
large, global brands such as IKEA, Carlsberg and Unilever. She then worked for 12 years in Telenor's
international operations, where she worked in change and improvement projects across all 12 markets
in which Telenor was involved. For the past two years, Ms Lim has been the Marketing and
Communications Director at Zalaris, where she has rebranded the company and contributed
significantly to the company's sales.
Ellen Skaarnæs – Chief People Officer
As Chief People Officer, Mrs Skaarnæs’ key focus is to ensure that Techstep is an attractive workplace
with a culture and people focus that our people and great talents want to be part of. Mrs Skaarnæs is
an experienced, strategic and business-oriented HR leader with a keen focus on delivering results and
adding value to the business. She has a broad background from international organisations at both
the strategic and operational level. With her 13 years in Shell holding various positions at all levels (from
HR advisor to Managing Director) and 5 years at Coca-Cola Enterprises as Ass. Director, HR Business
Partner, she brings extensive experience from performance and talent management and change
management in addition to solid leadership and coaching experience.
Bartosz Leoszewski – Chief Technology Officer
Mr Leoszewski is an experienced IT and software leader and entrepreneur. He is experienced in building
software products and their strategy, setting a long-term technology direction with cybersecurity
always at the forefront. As a software engineer in 2006, Mr. Leoszewski co-founded Famoc, where he
was first responsible for product development and engineering as Chief Technology Officer, and in
2012 transitioned to a CEO role - growing the company from just an idea into a recognised player in
the enterprise mobility market. Famoc was acquired by Techstep in 2021. Mr Leoszewski holds an MSc
in computer science from the Technical University of Gdansk and an Executive MBA from Rotterdam
School of Management. He is also a member of the Polish chapter of the Entrepreneurs' Organisation.
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Fredrik Logenius – Chief Operational Officer
Mr Logenius is a first-mover, entrepreneur and an experienced executive within the information
technology and services industry. His skill set is broad and based on entrepreneurship and strategy,
agile methodologies, software development and mobile solutions. Mr Logenius has been Managing
Director of the Swedish company Optidev AB, which Techstep ASA acquired in 2020, since 2015. Thanks
to business achievements with Optidev AB, he was awarded for being Entrepreneur of the Year 2020
in his hometown Borås where Optidev AB has its head office. Mr Logenius has also been nominated for
the EY Entrepreneur of the Year award, a programme which spans more than 60 countries around the
world.
Mads Vårdal – Chief Product Officer
Mr Vårdal is an experienced business developer and executive with a proven track record from
previous positions at Nordialog, Smartworks and Teki Solutions. His long experience from the industry
covers sales, strategy, business development, M&A processes, product development and executive
manager roles. Mr Vårdal has since 2007 been operating in several central executive roles within sales,
business development and daily management with a build and turnaround focus.
David Landerborn – Chief Delivery & Advisory Officer
Mr Landerborn is an experienced executive within the information technology area. He has wide
experience from several leading roles, but his depth is in the operational part including strategy, agile
methodologies, software development and mobile solutions. Mr Landerborn was the Deputy
Managing Director and Chief Operating Officer of Optidev AB from 2016, which Techstep ASA acquired
in 2020. He is deeply involved in local tech initiatives in Borås to make sure the rising stars in tech
choose Techstep as their employer. Current engagements include president of the IT programme at
Yrkeshögskolan in Borås, member of the competence board at the University of Borås and he is also
leading a local tech networking group that includes many of the leading tech companies in the region.
Mr Landerborn holds a bachelor’s degree in computer science from the University of Borås.
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Board of Directors
Michael Jacobs – Chairman of the Board
Mr Jacobs is the Executive Vice President of the Nordics at Crayon ASA, a customer-centric innovation
and IT services company. He has more than 30 years’ experience from extensive management
positions from several international technology companies. He previously was the CEO of Fell Tech
and before that he was the CEO of Atea Norway, where he improved its business performance and led
the transformation to more value-added services. He also served as the Managing Director of
Microsoft Norway and the Managing Director for the Nordics at Dell. He also has experience from
Oracle and Telenor, both in Norway and internationally. He has a degree from California Lutheran
University and continuing education from, among others, Harvard University. Customer focused,
technology innovation and building strong diverse teams are areas that Michael is passionate about.
Mr Jacobs is a Norwegian citizen, living in Oslo, Norway.
Jens Rugseth – Board member
Mr Rugseth has served on the Board in Techstep since February 2019. In January 2023 he stepped down
as chairperson of the Board and remained as an ordinary Board member. Mr Rugseth is a co-founder
and Board member of Crayon Group ASA and Link Mobility Group ASA, and other current directorships
include Chairman of Karbon Invest AS, Sikri Group ASA, Kastel AS and Rift Labs AS, among others. Over
the past 30 years he has founded a number of companies within the IT sector. He has also held the
position as chief executive officer in some of the largest IT companies in Norway, including ARK ASA,
Cinet AS and Skrivervik Data AS. Mr Rugseth studied business economics at the Norwegian School of
Management. Mr Rugseth is a Norwegian citizen, living in Switzerland.
Ingrid E. Leisner - Board member
Ms Leisner has served on the Board in Techstep since February 2016. Ms Leisner’s directorships over the
last five years include current board positions in Storage Group ASA, Norwegian Air Shuttle ASA,
Maritime, Merchant ASA, Elliptic Labs ASA and Xplora Technologies AS. Ms Leisner has a background
as a trader of different oil and gas products in her 15 years in Statoil ASA. Her years of experience and
skills within business strategy, M&A, management consulting, change management and audit have
been very valuable when serving on the board of several companies listed on Oslo Børs. She holds a
Bachelor of Business degree with honours from the University of Texas in Austin. Ms Leisner is a
Norwegian citizen, living in Oslo, Norway.
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Melissa Mulholland - Board member
Ms Mulholland has served on the Board in Techstep since April 2021. Ms Mulholland is Chief Executive
Officer of Crayon, a digital transformation expert that through innovation and services helps
companies worldwide leverage the power of technology. Her previous experience include 12 years at
Microsoft, leading strategy and business development, and two years in Intel Corporation. She has
authored 12 books focused on how to build a business in the Cloud and is a board advisor for SHE,
Europe’s largest gender equality conference. Ms Mulholland holds an MA in Business Administration
and Strategic Management from Regis University in Colorado. She is a US national, living in Oslo,
Norway.
Harald Arnet - Board member
Mr Arnet has served on the Board in Techstep since September 2021. Mr Arnet has more than 30 years
of experience in national and international finance, industrial and financial investments. He is the CEO
of Datum AS, one of the company’s largest shareholders, and has held several board positions in listed
and non-listed companies, including Kahoot! AS, NRC Group ASA and several companies within the
Datum group. He holds a master's degree from University of Denver and London Business School. Mr
Arnet is a Norwegian citizen, living in Oslo, Norway.
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Board of Directors’ Report
Techstep is on a comprehensive
transformation journey, going from a
transactional hardware provider to a software-
driven mobile technology enabler with a
recurring services business model.
Over the last couple of years, Techstep has
invested heavily in a new technology platform,
integrated acquired entities and
commercialised the product offering. Techstep
is at the end of this investment phase, and the
key focus going forward is to extract synergies
and increase profitability from these
investments.
Business activities and strategy
Built on a decade of telecoms and mobile
technology expertise, Techstep was established
in 2016. Through several acquisitions, Techstep
has consolidated and expanded into the
Nordics and later European markets adding IP,
own software and security expertise to the
benefit of our customers. Our goal is to be the
leading European mobile technology enabler
for customers that want to work smarter and
more sustainably.
Techstep is the only mobile technology player
in the Nordics that can deliver managed
mobility including software, advisory and
hardware. People expect easy access to tools
and services across devices, both at home and
at work. We have solutions for those who work in
an office and for those who work out in the field,
also known as frontline workers. We have some
of the very best consultants in the field of mobile
technology in the Nordics and perhaps in
Europe.
Techstep has over the past five years acted as
a market consolidator in Norway and Sweden,
and continuously evaluates potential M&A
opportunities. In line with its strategy, Techstep
made strategic initiatives to strengthen its core
product offering and geographical position
also in 2022, with the acquisition of Crypho.
Techstep had NOK 1.3 billion in turnover in 2022.
The key focus and strategy has been to build
and transition toward more predictable
recurring revenue streams, by leading with
software and managed services, and then
adding hardware volumes on top.
Techstep serves more than 2 000 enterprise
customers across industries in the Nordics and
Europe, both large private and public
customers, with large upsell and cross-selling
opportunities.
Main developments in 2022
2022 was an intense year marked by the
ongoing transformation and reorganisation of
the Group. The organisation has taken large
steps during the year, with a new product
strategy, brand profile and stronger focus on
ESG in place, while building commercial
momentum. The new One Techstep
organisation is taking shape, and it has been
necessary to rightsize costs to the new
organisation. In second half of the year,
additional capital was successfully raised
together with the launch of a cost optimisation
plan, enabling the last leg of the transformation
and mission towards turning Techstep
profitable. This puts Techstep in a good position
to reap the benefits of investments made in a
growing managed mobility services market.
Rebranding
Techstep started the year, by launching the
rebranding of the company, and set a new
long-term vision of making the world of work
smarter and more sustainable. The Techstep
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rebranding simplifies and encapsulates our
brand story in a clear, purposeful and
meaningful way.
The new branding shows a more modern
mobile technology profile for the company,
giving a clearer message, storyline, and
position of how Techstep, through our “Smart”
product portfolio, bringing more value to the
customers through smarter mobile technology
for a brighter tomorrow.
Gartner recognised Techstep as the only
Challenger in the Magic Quadrant for
Managed Mobility Services
In June 2022, Techstep was recognised as the
only Challenger and one of very few European
players in Gartner’s Magic Quadrant for
Managed Mobility Services (MMS). Gartner
highlighted the following strengths for
Techstep:
●
Big focus on self-service. Techstep
resolves 60%+ of all help desk incidents
via self-service portal.
●
Techstep targets business outcomes.
Techstep is also one of the few
providers that includes sustainability
considerations in its strategy.
The recognition is a milestone for Techstep,
showing that the company is one of the top
European vendors within its market. This is a
quality stamp for Techstep and its customers.
shows that the strategic position and offering
that Techstep has built through the ongoing
transformation resonates well in the
marketplace. The recognition will help Techstep
utilise the market opportunity and drive the
managed mobility market.
Simplified product offering
Techstep is focused on evolving and
commercialising its product offering, and a
huge milestone in 2022 was the launch of the
three product portfolios
SmartControl, Smart
Works
SmartDevice
. This simplified
customer offering will solve customer
challenges more efficiently and consistently
deliver great customer value.
The new smart portfolio concept was launched
in March 2022. Throughout the year, new
solutions within the three areas have been
added, particularly in the latter half of the year
and more solutions are on the way moving into
2023. 2022 has been one of the most intensive
launch periods on record for the company, and
the commercial effect of these launches is
expected to materialise in 2023, and drive
increased adoption of Techstep’s software and
services and further build the recurring revenue
base.
Capital raise and cost optimisation to lift
profitability and increase flexibility
In September 2022, Techstep successfully
raised NOK 103 million in capital in a private
placement to fund the final phase of the
transformation, as well as to strengthen the
balance sheet. At the same time, bank facilities
and debt were renegotiated, and part of the
short-term debt was shifted to long-term debt,
creating more flexibility.
At the end of Q3, Techstep also announced a
NOK 90-100 million cost optimisation
programme, to align the cost base to the
simplified portfolio, and extract synergies from
acquired companies. During the fourth quarter
the programme was executed on, with a plan to
reduce overall operating costs by
approximately NOK 40-50 million put into place.
Techstep will achieve this by rationalising
marketing, administrative and IT spending and
at the same time reducing external consultant
usage.
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Unfortunately, the cost optimisation
programme also impacted Techstep
employees, and during Q4 a right-sizing of the
organisation was effectuated. The restructuring
reduced the headcount by 45, and Techstep
booked a one-time restructuring cost of NOK
8.4 million related to this. The full effect of the
reduction in headcount will take place in Q1
2023, but all costs related to the restructuring
were booked in Q4 2022. The headcount
reduction is expected to have a payroll
reduction impact of approximately NOK 40-50
million annualized.
The capital raise, in combination with the cost
optimisation programme will create flexibility,
and is an important step towards turning
Techstep profitable.
Sales activity
Techstep experienced an increase in sales
momentum and activity during 2022, aligned
with the overall focus of commercialising
Techstep. The company continued to see
growing demand and interest for Own Software
and managed services, driven by the new
product portfolio and a clearer value
proposition. The company signed new
customers, renewed some large contracts,
while at the same time increasing the focus on
upselling to existing customers.
We signed an important contract with Nortel in
2022, where we offer Mobile Expense
Management to all their customers. First part of
the delivery went live in December 2022, adding
NOK 3 million NOK in ARR from Own Software. We
also extended the contract and offering with
Volvo AB, Region Norrbotten and Trafikkverket
AB in Sweden. In Norway, to mention a few
customers, Equinor ASA, Mesta AS and ISS
Facility Services AS renewed and extended their
agreements with Techstep.
Recurring revenue base
Aligned with Techstep’s strategy to transition
toward more predictable recurring revenue
streams, we were happy to see the total
recurring revenue base grow 14% in 2022,
landing north of NOK 300 million.
Of the NOK 303 million in total recurring revenue,
more than one-third, NOK 111 million in ARR,
comes from Techstep’s high margin Own
Software portfolio. Gross margins in this area
are above 90%. Techstep’s advisory and
managed services solutions also proved to
have a compelling value proposition with
customers, lifting recurring revenue from these
contracts by 18% y/y in 2022.
The market opportunity
Mobile technology is one of the fastest growing
technologies and Techstep is well positioned in
the MMS market. Research shows strong
supporting trends and the expected CAGR is
assumed to be in the +20% range over the
coming years (Modor Intelligence).
There are many key drivers of the MMS market,
but in the short term there are clearly two
drivers that stand out, and where Techstep is
considered to have a unique value offering:
cost
efficiency
sustainability
.
The current macroeconomic environment and
cost inflation affect many businesses; hence
companies will look for cost reductions and
efficiencies wherever they can. The prices of
mobile phones are increasing, and
organisations lack both the competence and
solutions to handle and utilise the cost-saving
potential. Techstep’s software helps the
customers gain control of their devices and
optimise the corresponding costs. The
SmartDevice solution enables customers to
order, purchase and manage every step of the
process to increase efficiency and lower cost.
Data suggests estimated cost savings of NOK 4
000-10 000 per employee over a two-year
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21
period, when calculating both direct and
indirect costs.
Techstep’s SmartDevice solution further
supports companies’ increasing focus on
sustainability and ESG. SmartDevice offers a
more sustainable way of managing devices, by
applying circular economy principles with
repair and return solutions to extend the
devices’ lifespan and responsibly recycle when
devices can no longer be used. SmartDevice
also helps customers get control on emissions
data for devices procured, for easy climate
reporting and insight to support their emissions
reduction plan.
Financial review
Techstep prepares consolidated annual
accounts in accordance with IFRS and
approved by the EU, relevant interpretations,
and the Norwegian Accounting Act. A summary
of internal controls related to the accounting
process can be found in the Corporate
Governance section of this Annual Report.
In Q3 2022, Techstep launched new financial
targets, with key operating metrics being Net
gross profit, EBITA adjusted and ARR on Own
Software. These key figures will be incorporated,
updated and tracked in the financial review
going forward. Please see the Outlook section
and the separate chapter on Alternative
Performance Measures in this report for further
details.
Profit and loss
Techstep generated full-year revenue of NOK
1 323 million in 2022, compared to NOK 1 305
million in 2021. The overall revenue trend was
stable during the quarters in 2022, and adjusted
for divestments of the Voice and Contact centre
business, organic revenue growth was 3% y/y in
2022. The main revenue growth drivers were
transactional hardware and a solid
improvement in revenue contribution from our
Own Software portfolio.
In 2022, Own Software accounted for NOK 92
million (NOK 74 million), corresponding to a
revenue growth of 24% y/y. This is in line with
Techstep’s strategy to lead with Software and
build a scalable recurring business model. The
Famoc acquisition was included from Q2 2021,
so part of the growth was inorganic. Hardware-
as-a-Service revenue accounted for NOK 143
million (NOK 134 million). Advisory & Services
amounted to NOK 241 million (NOK 254 million),
where the decline was mostly related to the
divestment of the Voice and Contact centre
division. Related commissions were NOK 13
million (NOK 20 million), where the continued
downward pressure on operator commissions
is as expected. Operator commissions have
now reached levels where they are expected to
flatten out. Hardware sales (including bonus
from vendors) remain the largest revenue
generator with NOK 835 million (NOK 821
million), growing 2% organically.
Own Software accounted for 6.9% (5.7%),
Advisory & Services accounted for 18.2% (19.5%)
and Operating commission accounted for 1.0%
(1.5%) of revenue. The remaining relates to
Hardware-as-a-Service 10.8% (10.3%),
Hardware (including bonus from vendors) for
63.1% (62.9%) and Other 0.0% (0.1%).
Net gross profit for the full year 2022 was NOK
367 (NOK 368 million), which corresponds to a
flat development y/y. Pro forma net gross profit,
adjusted for divestments, increased by 3%.
Gross profit from our Own Software portfolio
increased by 21% y/y, with stable overall gross
margin of over 90%. The improvement in gross
profit from Own Software was offset by a
corresponding decline in gross profit from the
Advisory and Services division, linked to the
abovementioned divestment. The net gross
Annual report 2022
22
margin was 27.8% in 2022, down from 28.2% in
2021.
Total net operating expenses in 2022 were NOK
1 375 million, compared to NOK 1 416 million in
2021. Salaries and personnel costs decreased
by -6% to NOK 265 million, an effect of the
measures taken to optimise the cost base.
Option costs were NOK 4 million (NOK 5 million).
The number of employees was 315 at the end of
the fiscal year, compared to 341 at the end of
2021.
Other operational costs were NOK 110 million
(NOK 109 million).
Total net operating expenses also include a net
positive effect of NOK 30 million from other
income, related to the NOK 40 million gain from
the sale of the Voice and Contact centre
division. Last year the corresponding net effect
was negative NOK 17 million (other expenses).
EBITA adjusted amounted to negative NOK 24
million, up from negative NOK 38 million last
year. The main reason for the NOK 14 million
improvement in EBITA adjusted is related to the
decline in salaries and personnel cost, which
decreased by NOK 17 million y/y.
Depreciation increased by NOK 1 million from
2021 to 2022 due to an increase in the
Hardware-as-a-Service portfolio. Amortisation
increased by NOK 4 million from 2021 to 2022, as
a consequence of increased investments the
last few years into our Own Software portfolio, in
line with our growth strategy.
The ordinary operating loss (EBIT) amounted to
NOK 52 million in 2022, compared to an
operating loss of NOK 111 million in 2021. 2021 was
impacted by a large negative one-off (NOK 17
million), while 2022 EBIT was positive impacted
by a net positive one-time effect of NOK 30
million. Adjusted for this, underlying EBIT
improved by NOK 10 million in 2022, driven by
cost optimisation and a 6% decline in personnel
cost.
The net financial items amounted to negative
NOK 12 million in 2022, compared to negative
NOK 8 million in 2021. Interest cost increased due
to higher net interest bearing debt and a
general increase in interest rates, which are
based on floating NIBOR.
The net loss for 2022 was NOK 69 million,
compared to a net loss of NOK 103 million in 2021,
also positively impacted by the
abovementioned one-off effects.
Financial position
As at 31 December 2022, total assets were NOK
1 323 million, compared with NOK 1 315 million as
at 31 December 2021.
Intangible assets accounted for NOK 783 million
(NOK 776 million). Intangible assets included
goodwill of NOK 601 million and customer
relations and technology of NOK 182 million.
Total tangible assets were NOK 198 million (NOK
179 million) as at 31 December 2022, including
NOK 161 million (NOK 143 million) in hardware
leased out to customers, NOK 30 million ( 30
million) in leased assets, and NOK 8 million (NOK
6 million) in other fixed assets.
Total inventories and receivables were NOK 271
million as at 31 December 2022 (NOK 281
million).
Total equity at the end of 2022 was NOK 572
million (NOK 556 million), corresponding to an
equity ratio of 43% (42%). In 2022, Techstep
issued 95 501 240
new shares in connection with
the employee share purchase programme,
private placement and the acquisition of
Crypho.
Non-current interest-bearing borrowings of
NOK 91 million (NOK 97 million) includes loans
related to the Optidev and Famoc acquisition
Annual report 2022
23
and new long-term borrowing. Other non-
current debt of NOK 38 million (NOK 43 million)
primarily included leasing commitments of NOK
17 million and a buy-back obligation for leased
hardware of NOK 21 million.
Current interest-bearing borrowings amounted
to NOK 83 million (NOK 75 million) in 2022. They
included net bank overdraft accounts of NOK 28
million, as well as a short-term seller’s credit of
NOK 28 million and the short-term part of the
acquisition loan of NOK 28 million.
Other current liabilities of NOK 269 million (NOK
295 million) as at 31 December 2022 mainly
include payables to employees of NOK 40
million, deferred revenue of NOK 152 million,
leasing commitments of NOK 15 million and a
buy-back obligation for leased hardware of
NOK 17 million.
Net interest-bearing debt was NOK 113 million at
the end of 2022, compared to NOK 122 million at
the end of the preceding year.
Cash flow
The net cash flow generated from operating
activities was NOK 124 million in 2022, compared
to NOK 129 million in 2021. Profit before tax in
2022 included the sale of the Voice and Contact
centre. Operating cash flow in 2022 has a
reversal of this transaction, as the cash effect
occurred in 2021. Working capital in 2021 was
positively affected by large hardware volumes
at the end of 2021, as a result of increased
backlog from Covid-related delays.
Net cash flow used for investment activities was
negative NOK 180 million. This was largely due to
capital expenditures related to leased out
hardware of NOK 132 million (NOK 141 million).
Techstep continued to invest in Own Software
and IP portfolio, and 2022 capex related to these
projects and other development areas was NOK
52 million (NOK 49 million). The net cash flow
used for investment activities in 2021 was NOK
175 million, also related to the acquisition of
Famoc and proceeds from the sale of Voice and
Contact centre business (NOK 66 million).
Net cash flow from financing activities was NOK
68 million in 2022. This includes proceeds from
private placement of NOK 77 million, proceeds
from borrowings of NOK 56 million, lease
repayments of NOK 15 million and repayment of
bank loans of NOK 29 million. The net cash flow
from financing activities in 2021 was positive at
NOK 71 million, mainly related to proceeds from
issuing of shares of NOK 102 million.
Cash and cash equivalents increased by NOK 11
million during 2022 to NOK 61 million at the end
of the year. Techstep has approximately NOK 90
million in total credit limits from different
overdraft facilities. Please see note 15 for further
detail.
Allocation of the profit/loss for the parent
company, Techstep ASA
The loss for the year 2022 attributable to owners
of the parent was NOK 69 million, compared to
a loss of NOK 103 million for 2021. The Board has
proposed that the loss be covered by other
reserves.
Going concern
Based on the aforementioned comments about
Techstep ASA’s accounts, the Board of Directors
confirms that the annual financial statements
for 2022 have been prepared on the basis of a
going concern assumption, and that this
assumption has been made in accordance
with Section 3-3a of the Norwegian Accounting
Act.
Subsequent events
On 1 February 2023, Techstep strengthened its
executive management team by appointing
Ellen Solum as the new CFO and Anita Huun
taking on a new role as Chief Commercial
Annual report 2022
24
Officer. Together they will help Techstep further
sharpen its focus on both commercial growth,
cost efficiencies and profitability.
On 15 February 2023, the extraordinary general
meeting approved changes to the Board. Jens
Rugseth stepped down as Chairperson and will
continue as an ordinary Board member. Board
member Michael Jacobs was elected as the
new Chairperson of the Board.
Risk and risk management
As a mobile technology enabler, Techstep is
exposed to risks related to changes in market,
operational and financial conditions. Techstep
has in 2022 strengthened its risk management
framework, including frequent reporting to the
management and Board. The goal is to support
effective execution and decision-making to
reach the company’s goals and to ensure
compliance with legal and regulatory
requirements.
Reference is also made to the prospectus dated
29 November 2022, pages 6-10 for information
on potential risk factors. The prospectus is
available from the company’s website
Operational risk
Techstep’s operations, revenues and profits are
dependent on its ability to generate sales
through existing and new customers. Techstep
operates in a competitive market segment, and
the Group’s success depends on its ability to
meet changing customer preferences, to
anticipate and respond to market and
technological changes, and develop effective
and competitive relationships with its
customers and partners. Techstep continues to
focus on improving its product offering,
reducing customer implementation time, and
becoming a software-led growth business,
yielding higher cash flow and profit from
operations, and transforming into a recurring
revenue business model. The operational risk
mainly relates to the ongoing transformation
process, including standardisation of the
product portfolio and keeping key personnel
and necessary competence.
Financial risk
Techstep’s activities involve various types of
financial risk: credit risk, liquidity risk, currency
risk and interest rate risk. The primary focus of
the Group’s capital structure is to ensure
sufficient free liquidity, so that the Group can
service its obligations on an ongoing basis, and
at the same time be able to make strategic
acquisitions.
Credit risk
The credit risk relates to customers being
unable to settle their obligations as they
mature. Techstep has a well-diversified
customer portfolio, mainly comprising
medium-sized and enterprise companies in the
private and public sectors. The Group has
established mitigating procedures including
credit evaluation of major private customers,
and the credit risk is considered satisfactory.
Liquidity risk
Techstep’s liquidity risk is related to a mismatch
between cash flows from operations and
financial commitments. Techstep is
transforming itself from a transactional
business model to a software-led recurring
revenue model, which leads to postponed cash
inflows, negatively affecting the liquidity of the
Group. Investments in simplification and
standardisation of the company’s product
portfolio and solutions, new organisational
capabilities and acquisitions and integration,
have furthermore increased the company’s
debt over time. Techstep depends upon having
access to long-term funding and other loans
and debt facilities to the extent its own cash
Annual report 2022
25
flow from operations is insufficient to fund its
operations and capital expenditures, including
repayment of the company's current borrowing
at maturity. The Group's liquidity is closely
monitored by management and the Board of
directors. If the need arises, the Group has
access to multiple funding sources during the
transformation process.
Foreign exchange risk
Techstep uses Norwegian krone (NOK) as its
presentation currency but is exposed to
exchange rate fluctuations from operations
abroad, mainly the Swedish krona (SEK), Polish
Zloty (PLN) and Euro (EUR). The company has
exchange rate risks related to the currency
translation of profit generated in its foreign
subsidiaries. In 2022, around 60% of the Group’s
revenue was in NOK, with approximately 30% in
SEK, and the remaining in PLN and EUR. Techstep
does not use any hedging instruments against
exchange rate fluctuations, which may have a
negative effect on the company’s consolidated
financial results and financial position if the NOK
deteriorates against the relevant currencies.
Macroeconomic and geopolitical risk
The war in Ukraine, combined with the tension
between China and Taiwan and the US
sanctions on China, have led to increased
uncertainty regarding the development of the
global economy. The evolving conflicts do not
impact Techstep directly, and Techstep has no
operating presence in the affected areas.
Indirect effects however, such as financial
market volatility and general economic market
conditions, might have an impact on financial
results. The high inflation and energy prices
may further weaken the economic outlook.
Techstep has a large base of public sector and
large corporate customers, which are less
vulnerable to volatile market conditions.
The global component shortage, combined
with production, logistics and transportation
challenges in the supply chain, may result in
Techstep experiencing delays in hardware
deliveries. At the time of this report, there are no
such indications. Techstep continues to
maintain close cooperation with key suppliers
to ensure timely deliveries.
Climate-related risk
Climate risk relates to physical climate risk and
transition risk. Physical risk is associated with
increased extreme weather and ecosystem
changes. For Techstep, this may primarily relate
to supply chain disruptions in the form of
manufacture or delivery problems, or a lack of
raw materials. Transition risk is associated with
changes in regulations, technology and the
market situation in connection with the
transition to a low emission society. For
Techstep, this may relate to changes in
customer preferences to reduce environmental
impact, and reduced access to capital and
future talents if the company does not
accelerate the sustainability agenda and
measures in line with market expectations.
Techstep seeks to mitigate this through its
Lifecycle solution, which has a great opportunity
to help extend devices’ lifetime and contribute
to the circular economy, and through a clear
focus on sustainability and ESG.
Transactions with related parties
Fredrik Logenius, a member of Techstep’s
executive management team, also owns 50% of
Stobor Invest AB. Trades between Techstep and
all related parties are disclosed in note 23.
On 6 May Techstep entered into an agreement
to acquire the entire share capital of Crypho AS.
Following the transaction, Karbon Invest AS
agreed to sell its 33.50% shareholding in Crypho
AS and subscribe for 123 579 new shares in
Techstep ASA at a price of NOK 3.25 per share
Annual report 2022
26
(based on 90-day VWAP). Karbon Invest AS is
indirectly controlled by Board member (former
Chairman of the Board) Jens Rugseth.
There were no other material transactions with
related parties during 2022.
Corporate governance
Techstep’s corporate governance structure is
based on Norwegian legislation and the
Norwegian Corporate Governance Board
(NUES/NCGB), last revised 14 October 2021. A
statement on Techstep’s corporate
governance principles and practices is
provided in a separate section of this annual
report on pages 50 to 57. In the company’s own
assessment, Techstep did not deviate from any
sections of the Code as at year-end 2022.
Techstep has Directors and Officers liability
insurance for the Group. The insurance covers
the Board’s and the management’s legal
personal liability for financial damage caused
by the performance of their duties.
Corporate social responsibility
(ESG)
Techstep aims to be a responsible company
which respects people, society and the
environment. The company’s mission is to
make positive changes to the world of work
through mobile technologies; freeing people to
work more effectively, securely and sustainably.
As a signatory to UN Global Compact, Techstep
is committed to responsible business practices
in the areas of human rights, labour, equality,
anti-corruption and the environment. During
2022, Techstep has strengthened focus on
environmental, social and governance (ESG),
including priorities and metrics. Techstep has
further improved its EcoVadis sustainability
rating performance to silver, placing Techstep
among the top 9% of more than 90 000
companies evaluated globally.
Details on Techstep’s material ESG activities are
included in a separate sustainability chapter of
this annual report, which covers what Techstep
does to promote, uphold and recognise human
rights, labour rights, social issues, working
environment, climate and environmental
aspects and anti-corruption measures into the
business strategy, daily operations and the
relationship with stakeholders. The chapter also
includes Techstep’s reporting pursuant to the
Norwegian Transparency Act and the Equality
and Anti-Discrimination Act. The sustainability
chapter is available on pages 28 to 49 in this
annual report.
Shareholder information
As at 31 December 2022, Techstep had
305 131 070 shares outstanding, an increase
from 209 629 830 shares one year earlier. The
company had 3 345
shareholders. At the end of
2022, Techstep held 1 914 treasury shares. The
shares have a par value of NOK 1.0.
The company’s largest shareholder, Datum AS,
held 19.1% of the shares at year end, with the 20
largest shareholders holding 72.9% of the
shares outstanding.
During 2022, Techstep’s share price fluctuated
between NOK 1.09 and NOK 4.10 per share. The
final price at the close of the year was NOK 1.15
per share, down from 3.65 per share in the
previous year.
For detailed shareholder information, see note
25 in the consolidated financial statements for
2022.
Outlook
Techstep is positioned as a leading Nordic
provider of managed mobility services and
recognised by Gartner as the only challenger in
the Magic Quadrant for managed mobility
services. The goal is to become the leading
European mobile technology enabler for
Annual report 2022
27
customers that want to work smarter and more
sustainably.
Techstep is serving more than 2 000 customers
across industries in both the private and public
sector in Europe. The company is on a
transformational journey, from a hardware and
transactional business model to a software-led
recurring revenue model. After integrating
seven different companies into One Techstep,
the product offering has been streamlined from
47 to 7 products to a new, simplified and
scalable product portfolio that enables
increased software sales to existing and new
customers.
Techstep is now streamlining its operations and
aligning its cost base to the simplified portfolio
and extracting synergies from acquired
companies. Through standardisation and
automation, change of ERP systems and right-
sizing the organisation, Techstep expects the
NOK 90-100 million cost reduction programme
launched in the third quarter of 2022 to
materialise during the year. Techstep saw effect
of these initiatives already from the fourth
quarter 2022.
Techstep has stated new and clear medium
and longer-term financial goals. In 2023, the
ambition is an ARR on Own Software of NOK 140
million, net gross profit of 420 million and EBITA
adj. of NOK 50 million. By 2025, Techstep targets
an ARR on Own Software above NOK 225 million,
net gross profit above NOK 540 million and EBITA
adj. of NOK 150 million.
Moving forward, growth will be driven by the
new product portfolio, the refocused sales
strategy, and converting existing customers to
MMS contracts. This is expected to have a
positive tailwind on Advisory & Services as well
as Hardware revenues.
Techstep is confident that its MMS offering has
a strong value proposition and increasing
relevance as it helps enterprises reduce costs,
increase productivity, transform employee
capabilities and enhance their engagement,
ultimately driving business value and revenue
growth, while delivering on ESG goal
Annual report 2022
28
Sustainability
In Techstep, we aim to be a positive agent for change in society by
making the world of work smarter and more sustainable.
We believe in the power of mobile technology to make employees happier and more productive by
freeing them up to work smarter. Our solutions can help them do this in a more sustainable and secure
way. This means we will help our customers deliver on their ESG commitments, but also ensure that
we are using resources in a way so that they aren’t depleted over time. It’s about taking care of people
and the environment, both today and for the future.
Equally important, responsible business practices are a pre-requisite for long-term successful
operations and profitability. We need to be environmentally, socially and economically responsible
across our operations to meet the requirements and expectations from our stakeholders. That means
that we need to have effective business processes, tools, ways of working, governance and
compliance practices in place. As a company, we align our sustainability practices with international
standards for human rights, working conditions, environment and anti-corruption.
Techstep supports the UN’s 17 sustainable development goals and has pledged to operate in line with
the UN Global Compact’s 10 principles for responsible business conduct. Our sustainability reporting
shows how Techstep as a company impacts and is impacted by changes in the environment, climate
and society and how we respond to this.
Reporting standards
This sustainability report has been
prepared for the period 1 January 2022 to
31 December 2022, unless stated
otherwise. The report covers the entire
Techstep Group, and includes relevant
disclosures for a range of environmental,
social and governance (ESG) topics, as
well as reporting principles related to the
reporting process. The content is in
accordance with the Global Reporting
Initiative (GRI) standards and guided by
the UN Global Compact and the UN
Sustainable Development Goals.
Greenhouse gas emissions are reported
in accordance with the Greenhouse Gas
Protocol and verified by an accredited
third party.
Annual report 2022
29
Highlights from the year
Material topic
Techstep’s goals
What we did in 2022
SDGs
Circularity
Grow number of end-of-life
returns
Collected 14
395 devices;
avoided emissions ~832 tCO
2
Energy usage &
GHG emissions
Minimum 50% reduction of GHG
emissions in scope 1&2 by 2025
100% renewable energy at all
Nordic offices
Baseline established in 20221
1
,
scope 1&2 emissions of 52.2 tCO
2
25% renewable energy
Diversity &
inclusion
Above 30% female employees
by 2025
Increased share of female
employees to 27% at all levels
Employee
engagement
Engagement score at 8.0 of 10
by end of 2023
Engagement score
at 7.1 of
10 at
31.12, average of 7.4 for the year
Supply chain
responsibility
ESG due diligence of all Tier 1,
Tier 2 and Tier 3 suppliers in
2023
Established new framework for
supplier management and
commenced due diligence of
main suppliers in line with the
Norwegian Transparency Act
2
Cybersecurity &
data privacy
No leak of customer data
Security awareness training of
all employees in 2023
ISO 27001 certified by 2023
Strengthened security
governance
65% of employees completed
security awareness training
Business ethics &
anti-corruption
Zero serious compliance
incidents
100% of employees signed code
of conduct
Digital literacy &
skills in society
Educate more people on
advantages mobile technology
offers
Close to 2 500 people attended
events hosted by Techstep
1
The carbon accounting for 2022 forms the basis for reduction initiatives going forward, as 2021 was an abnormal year due to
Covid-19 restrictions and staff working from home. Figures reported in 2021 have been restated due to more accurate data.
2
The section “Responsible sourcing” in this report also includes Techstep’s reporting pursuant to the Norwegian Transparency
Act.
Annual report 2022
30
Corporate governance and sustainability management
Techstep’s ESG policy outlines our overall commitment to responsible business practices with respect
to people, environment and society. Sustainability is incorporated into Techstep’s strategy, objectives
and management systems. The Board of Directors has the overall responsibility for aligning Techstep’s
strategy and ESG considerations. Operationalising of principles into day-to-day operations lies with
the CEO, supported by the executive management group. Each executive is responsible for
communicating these to everyone in their respective business units.
Techstep also has a dedicated function to ensure sufficient focus on driving sustainability and
advancing the company’s ESG programme across the organisation, as well as ensure compliance
with internal and external requirements. The function reports to the CFO, the audit committee and the
Board. ESG, risk and compliance are on the agenda at the monthly management meetings, as well as
quarterly audit committee meetings, and selected board meetings.
During 2022, Techstep strengthened focus on ESG, risk and compliance with a dedicated unit and
stronger team in place. Much effort was spent on developing a unified management system based
on the ISO standard, with emphasis on quality, security and environment, to support day-to-day
operations and ensure a more systematic approach to improving business processes and ESG
performance. Governing policies and procedures have been reviewed and developed to reflect the
new organisational structure, including risk management and internal control.
The management system was certified in accordance with ISO 9001 (quality) and 14001 (environment)
in Q1 2023. The work with continuous improvement across all business operations will continue in 2023,
as well as targeting ISO 27001 certification (information security) by the end of the year.
Techstep adheres to the Norwegian Code of Practice for Corporate Governance issued by the
Norwegian Corporate Governance Board (NCGB). Techstep’s corporate governance practices are
included as a separate chapter in this annual report on page 35. Publicly available governing
documents are published on the company’s website.
Governance bodies in Techstep
Annual report 2022
31
Stakeholder dialogue and material topics
Continuous dialogue with our stakeholders is considered crucial for sustainable growth, ensuring
valuable insight and opportunities for improvement.
Stakeholder
group
How we engage
Central topics
Customers
●
Ongoing dialogue
●
Tender processes
●
ESG assessments
●
Customer centre
●
Ethical trade (human rights, labour conditions)
●
Circularity (used devices, end-of-life handling)
●
Data security and privacy
●
Environmental management
(certifications, transport and packaging)
●
Quality management
Investors
●
Quarterly presentations
●
Annual general meeting
●
Investor meetings
●
Climate risk (GHG emissions, taxonomy driven,
financial risk)
●
Governance practices
●
People practices (human capital)
●
Data security and privacy
●
Profitability
Employees
●
Employee engagement
survey tool
●
Workplace (intranet)
●
Monthly check-ins
●
Day-to-day communication
●
Employee engagement and well-being
(motivation, stress, work-life balance)
●
Training and education (competence)
●
Equality, diversity and inclusion
●
Environmental impact
Partners/
Suppliers
●
Partner meetings
●
Own ESG strategies
●
Ethical trade
●
Governance practices
●
Environmental impact
●
Competence/ talent management
Industry
●
Partnering in industry
coalitions, meetings, seminars
●
Circularity
●
Ethical trade
Regulators
●
Ongoing assessment of
relevant laws and regulations
to ensure compliance.
Monitoring developments and
new legislation to proactively
respond to information
requests.
●
Climate and environmental management
●
Human rights and labour rights in supply chain
●
Workplace health and safety
●
Diversity and equality
●
Anti-corruption
●
Governance practices
Annual report 2022
32
Materiality
We conducted a materiality assessment in 2021 to identify the sustainability topics that are most
material to our business and to our stakeholders. Topics included in the process were selected based
on requirements and information requests especially from customers and investors, peer and industry
benchmarks, international reporting frameworks and standards such as Global Reporting Initiative
(GRI) and Sustainability Accounting Standards Board (SASB), legal requirements and new
sustainability legislation. The materiality assessment, which was revised at the end of 2022, has helped
us identify topics which are considered to have a significant impact on Techstep’s long-term business
success.
Material topics identified:
●
Circularity
●
GHG emissions
●
Diversity, equality and inclusion
●
Employee engagement
●
Responsible sourcing
●
Cybersecurity and data privacy
●
Business ethics
●
Digital literacy & skills in society
We consider the prioritisation based on materiality assessments as a dynamic process and will
continuously adjust our priorities and actions based on company development, changing legislation,
stakeholder feedback and developments in sustainability/ESG frameworks.
EU Taxonomy
The EU taxonomy is a classification system with a list of environmentally sustainable economic
activities and an important enabler to scale up sustainable investment and implement the European
Green Deal. Techstep will be required to disclose to what extent its turnover, investments and
operational costs are aligned with the EU taxonomy criteria, currently expected from 2025. Going
forward, Techstep will evaluate current and possible taxonomy-eligible activities and measures
required to transit towards taxonomy alignment of the activities in question.
Annual report 2022
33
Circularity and responsible use of devices
Mobile devices are excellent work tools, but put a strain on climate, environment and society
throughout their lifespan, from production to disposal. Globally, close to 60 million tonnes of electronic
waste are generated each year, and the amount is only increasing. Estimates say that less than 20%
of the electronic waste is collected and recycled, and around 700 million mobile units are hibernating
in people’s homes in Europe alone. Embedded in the devices are several rare earth and critical
materials such as gold, copper, silver, tungsten and tin – resources that could be recovered and
returned to the production cycle.
The most effective way of counteracting this is to extend devices’ lifetime and ensure that devices that
can no longer be used are recycled in a responsible manner. By helping customers with life-cycle
management, repair and end-of-life handling, more devices can get a prolonged life or a second life
in the second-hand market.
Key figures 2022
End-of-life returns and avoided emissions
Circular economy principles and device lifecycle management are part of Techstep’s core offerings.
Our Lifecycle solution is designed to digitise and simplify enterprises’ mobile device lifecycle
management process, including repair, return and recycling until end-of-life. We cooperate with
certified partners specialised in wipe, repair and refurbish and resale of used devices, so that well-
functioning devices can get a new life in the second-hand market. This way, we help extend devices’
lifetime while allowing more people access to mobile technology at an affordable cost. Units that
cannot be used any more, are properly handled for recycling.
Through our take-back solution, Techstep collected close to 14 400 mobile devices for end-of-life
handling in 2022. Over 90% of the units were securely wiped and refurbished for reuse and sold to the
second-hand market. The positive environmental impact (handprint) of this is estimated to be over
830 tonnes
3
2
appropriate waste operators, in accordance with the WEEE-directive.
Going forward we will grow the number of devices we collect for end-of-life handling to prolong their
lifespan and intensify collaboration with manufacturers and strategic partners to improve circularity
along the value chain.
3
Based on calculations from our reseller partners
Annual report 2022
34
Climate and environmental impact
In Techstep we are committed to minimising our climate and environmental impact. Our
environmental policy describes our approach to environmental management, including measures to
reduce our own carbon footprint and helping customers and suppliers to become more efficient in
resource usage.
Key figures 2022
Main developments
Our first, group wide carbon accounting was established in 2021 to get an overview of our direct and
indirect emissions. In 2022, we have worked on improving the data quality of the carbon accounting
and continued mapping the organisation’s greenhouse gas emissions, including main categories
related to our operations. A more complete compilation of data helps us to understand how we can
reduce emissions in our own operations and throughout the value chain. During 2022, we have also
strengthened environmental management in the organisation, and became ISO 14001 certified in Q1
2023.
Scope 1
Scope 1 emissions of 20.2 tCO
2
e are related to the combustion of fuels in company-owned vehicles
and represent 39% of the total emissions in scope 1 and 2. The scope 1 emissions increased
substantially from 2021, mainly due to 2021 being an abnormal year due to Covid-19 restrictions and
with most of the employees working from home. Going forward, we will switch to electric vehicles when
company cars are replaced.
Scope 2
Scope 2 emissions of 32.1 tCO
2
e account for 61% of the total scope 1 and scope 2 emissions, and 0.3%
of total emissions in 2022. These emissions stem from acquired electricity, heat and cooling in the
company’s offices, as well as electric vehicles. The emissions in 2022 are slightly down from 2021, due
to more accurate data and implemented energy efficiency measures at some of the offices. In 2022,
25% of Techstep’s electricity consumption was covered by purchase of Guarantees of Origin (GoO’s).
Scope 3
Total scope 3 emissions were 11 753.8 tCO
2
e, representing over 99% of Techstep’s total emissions in
2022. The increase of 22% from 2021 relates to more accurate data, products purchased and increased
travel activity. As a reseller of mobile devices and accessories, we do not manufacture any of our own
products. Distribution is mainly outsourced to logistics partners as a “dropshipping” solution, which is
Annual report 2022
35
more efficient and more environmentally friendly as the goods are shipped directly to the customer.
Purchased goods mainly represent mobile devices (88%) and accessories (11%) sold to customers,
and cloud services related to own software (0.2%). Techstep uses cloud-based data centres such as
Microsoft 365 and Azure Compute, which are much more energy efficient than traditional on-premises
data centres. In addition, data is stored on different software platforms managed on the providers’
hosting infrastructure. In 2022, business travel increased due to a normalisation of travel activity after
the Covid-19 pandemic and increased air travel after the acquisition of Famoc in Poland in Q3 2021.
Key figures GHG emissions
Figures denoted in tCO2e
2022
2021
4
Transportation
Diesel
14.3
1.1
Petrol
5.8
0.3
Scope 1 emissions
20.2
1.3
Electricity (location based)
Electric vehicles
1.9
0.8
District heating/cooling
4.4
4.2
Electricity Nordic mix
7
7.8
Electricity Poland
18.7
20
Scope 2 emissions
32.1
32.9
Business travel
81.4
23.7
Purchased goods and services
11 648.9
9 611.9
Fuel- and energy related activities
16.5
15
Upstream transportation and distribution
3.0
2.5
Waste
3.8
3.4
Total emissions Scope 3
11 753.8
9 656.6
Total emissions
Total emissions - scope 1 & 2
52.2
34.2
Total emissions - scope 1, 2 & 3
11 806.0
9 690.8
Emission intensity – tCO2 per NOK million
Emission intensity – scope 1 & 2
0.04
0.03
Emission intensity – scope 1, 2 & 3
8.92
7.43
Annual market-based GHG emissions
Figures denoted in tCO2e
2022
2021
Electricity total (scope 2) with market-based calculations
64.9
82.9
Scope 2 total with market-based electricity calculations
71.3
87.9
Scope 1+2+3 total with market-based electricity calculations
11 845.2
9 745.8
All data is disclosed in our carbon footprint report, available from our website. The carbon footprint
report is based on the Greenhouse Gas Protocol and is verified by our auditor BDO.
4
Figures reported in the annual report for 2021 have been restated for scope 2 and 3 due to more accurate data from suppliers.
Annual report 2022
36
Main focus going forward
The carbon accounting for 2022 forms the basis for reduction initiatives going forward, and our goal
is to reduce scope 1 and 2 CO
2
Our focus to reduce emissions includes switching company vehicles to electric vehicles when
replaced and to use 100% renewable energy in our Nordic offices. We will also explore opportunities for
more environmentally friendly energy solutions at our Polish office.
Emissions related to goods and services are expected to increase going forward as Techstep grows
its business, which partly will be offset by newer products with lower emissions. To reduce the
environmental impact, we will actively help customers choose more eco-friendly products from what
is available on the market. We will also work closely with our distributors to improve and optimize
logistics solutions such as packaging and emission-free distribution.
We will also continue to expand scope 3 emission data to include more emission sources and
improving data quality going forward. This will be critical to track the development of emissions and
define meaningful reduction targets for scope 3.
Annual report 2022
37
Our people
At Techstep, we believe that our success depends on a healthy, engaged and competent workforce.
We strive to provide our employees with a professional, safe and trusted working environment in which
all individuals are respected and treated fairly, and with dignity.
People are central for Techstep to grow and deliver long-term value. 2022 was however a challenging
and transformative year for Techstep, with larger organisational changes to become one integrated
company with common ways of working across the organisation. In addition, the cost optimisation
programme required us to reduce the headcount by about 15%. Turnover for the year was 24%, which
is high but expected, considering the transformation and rightsizing of the organisation. At year end,
Techstep had 315 employees.
Becoming One Techstep and getting acquainted with common standards on ways of working
continues to be our focus going forward.
Annual report 2022
38
Diversity, inclusion and equality
At Techstep we embrace diversity and equality, believing that different perspectives, experience and
backgrounds foster dynamics, creativity, and innovation. With increased diversity and broad
representation of individuals in the company, we will become a better partner to our customers.
Techstep has zero tolerance for discrimination and sexual harassments in the workplace. Techstep’s
HR function is responsible for following up equality and diversity in the Group.
Key figures 2022
Operating in what historically has been a male dominated industry, recruiting, retaining and
advancing women has been a priority. By promoting gender balance in recruitment processes, 38%
of all new hires during the year were women and 27% of management hires or promotions were
women. Despite the rightsizing of the organisation, the share of women increased during the year.
Techstep uses the SHE Index to track progress, and at the end of 2022 the SHE Index score had
improved from 61 to 69 points out of 100. Over time, Techstep aims to reach a SHE Index score of 80.
Compensation and benefits
Techstep seeks to offer competitive remuneration to all employees, reflecting their education,
experience and professional qualifications, as well as local industry standards. All employees are
included in a collective bonus scheme, and in the same insurance schemes based on country level.
Techstep offers additional payment for parental leave for both men and women, based on local
arrangements. In 2022, men and women in Techstep typically used the allocated amounts of parental
leave in line with the national guidelines.
All employees shall be entitled to equal opportunities for equal work, meaning the same rights, salary
and career options in the same position, all other factors being equal. A recent mapping of wage levels
across the organisation has been conducted to identify potential wage gaps, increase transparency
and improve fairness. Based on our initial analysis, there are no significant gender-related salary
differences. Wage gaps identified seem to be more related to length of experience and type of
competence, but the mapping will continue going forward.
Annual report 2022
39
Job level
Norway
Sweden
Poland
Denmark
Level 1-2
93 %
109 %
85 %
Level 3
92 %
125 %
119 %
Level 4
97 %
97 %
96 %
Level 5
89 %
121 %
93 %
Level 6
95 %
Level 7
83 %
Figure: Average ratio of women base salary over men’s base salary for 2022
5
Executive remuneration is guided by Techstep’s remuneration policy, which is prepared by the Board
and adopted by the general meeting. The remuneration report is available from the website
5
Annual report 2022
40
Employee engagement
A rapidly changing and complex industry requires the ability to have the right competence.
Techstep’s long-term success is dependent on recruiting skilled mobile technology
professionals and support personnel and providing our employees an environment to
develop and grow talent.
In 2022, we launched a mandatory leadership training programme for all managers in the
organisation. Focus during the year has been on developing a structured framework for
training and competence development for our people to grow and the organisation to
succeed. We have also launched a new onboarding programme for all newcomers, to
increase engagement and confidence from the start, while easing the transition into their
new roles.
We have monthly check-ins and reviews for closer follow-up of all employees, as we believe
regular dialogue is key to building engaged and high performing teams. An employee
engagement survey tool is applied to seek valuable feedback from all employees on a
weekly basis on topics such as personal development and team spirit, to work situation and
leadership. The feedback helps us to actively take appropriate actions to continuously
maintain a highly engaged organisation and detect challenges including discrimination
and imbalanced work/life situations.
The organisation’s engagement score picked up during the year, before dropping in
connection with the downsizing process of the organisation. At the end of the year, the
engagement score was at 7.1, while average score for the year was 7.4. This is a bit down
from the year before but reflects a challenging period for the organisation. Focus in 2023 will
be on building a unified and strong culture, developing leaders and strengthening
employees’ capabilities. During Q1 2023, the engagement score has picked up and is
trending around 7.5. Techstep targets an engagement score of 8.0 by the end of the year.
Share-based incentive programme
We believe that employees owning shares in our company promotes value creation through
increased engagement, commitment and loyalty. A provision has therefore been made for
employees to buy shares at a discount through a share purchase employee programme.
9% of the workforce participated in the share purchase programme in 2022.
Annual report 2022
41
Working environment, health and safety
Working with IT typically includes many hours in front of a computer. Techstep employees have the
right to a healthy and safe workplace, including a good workplace environment and ergonomics.
Techstep’s offices are located in modern facilities, and all employees are offered health services
through private health insurance arrangements. We also comply with the conventions of the UN Global
Compact and the International Labour Organisation.
The Covid-19 pandemic accelerated Techstep’s focus on flexible working arrangements to support a
healthy work-life balance. In 2022, Techstep implemented a hybrid working solution that facilitates
efficiency and collaboration combined with employees’ personal preferences in terms of their work
arrangements.
Techstep targets a sickness absence rate of 3% or less. In 2022, the sick leave was 3.6% of the total
working hours in the Group, which is considered a normal level within our industry. There were no work-
related illnesses or incidents reported during the year.
Annual report 2022
42
Employee data
2022
2021
2020
Total number of employees
Total number of employees (incl. part time)
315
341
289
Number of employees based in Norway
125
na
na
Number of employees based in Sweden
144
na
na
Number of employees based in Denmark
3
na
na
Number of employees based in Poland
43
na
na
Number of part-time employees (all of which voluntary)
3
6
12
Turnover rate (incl. downsizing in 2022)
24%
13%
na
Employee engagement score at year end
7.1
7.4
na
Diversity and equality
Share of women – Board of Directors
40%
40%
40%
Share of women – Executive management
38%
13%
0%
Share of women – Management direct reporting to EMT
6
27%
29%
43%
Share of women - Group total
27%
23%
24%
Share of women – Part-time employees
67%
33%
75%
Share of women - New employees
38%
na
na
Share of women - Promotion/hire to management positions
27%
na
na
SHE Index score
69
61
63
Age breakdown < 30
11%
14%
13%
Age breakdown 30-50
69%
68%
68%
Age breakdown 50+
20%
18%
18%
Average weeks of parental leave - Norway (women/men)
7
34/17
25/15
na
Average weeks of parental leave - Sweden (women/men)
7
23/7
2/7
na
Average weeks of parental leave - Poland (women/men)
7
32/32
46/2
na
Health and safety
Sick leave
3.6%
3.5%
3.3%
Occupational injuries
0
0
0
Lost time injuries
0
0
0
6
7
parental benefit is 480 days (16 months) of paid leave, of which 390 days are sickness benefit qualifying days that can be taken,
and each parent has an exclusive right to 90 of those days (18 weeks). In Poland, parental leave is 32 weeks and can be used
freely by both parents.
Annual report 2022
43
Responsible sourcing and supply chain
management
Techstep is committed to respecting and supporting human rights and workers’ rights, as reflected in
our ESG policy and our commitment to the UN Global Compact. Techstep shall uphold and protect
internationally proclaimed human rights and labour rights and treat employees with dignity and
respect as understood by the international community. Our goal is that no form of human rights
abuses or labour issues, including forced labour, human trafficking or any form of modern slavery,
shall occur in our value chain.
Our partners and suppliers are important parts of our value chain, as they provide us with the products
and services we need to deliver our solutions to our customers. Our relationship with our third party
partners also brings responsibilities, including a shared concern for the environmental impact of our
supply chain and potential social and compliance risks such as human rights violations if these factors
are not managed appropriately. Even though we do not directly influence working conditions or the
climate footprint in the supply chain, we believe in advocating for changes. We do this through
responsible sourcing by setting clear expectations to our third parties and challenging them to
continuously improve to increase positive and limit negative impacts on people and environment.
In 2022, Techstep purchased goods and services for approximately NOK 970 million, of which close to
80% relates to hardware and related accessories sold to customers. Of some 200 suppliers, 16 of them
are manufacturers and only five of them are considered to be Tier 1 and Tier 2 suppliers to Techstep.
Our due diligence efforts are hence prioritised accordingly.
Our initial mapping shows that our greatest risks related to human rights violations and labour
standards violations relate to the value chains of hardware production. The potential risks specifically
identified were child and slave labour, employment conditions, restrictions in the right to organise,
discrimination, health and safety.
The Norwegian Transparency Act
The Norwegian Transparency Act entered into force on 1 July 2022, and its introduction has coloured
our work with respect to responsible business practices. During 2022, we have improved internal
procurement processes as part of the work with strengthened focus on ESG, risk and compliance in
the Group. The work relating to the Transparency Act is an integral part of Techstep’s general efforts
to promote sustainability in the supply chain, with focus on the highest potential risk of human rights
violations or poor labour standards, or negative environmental impact. This applies both in terms of
risk to others (for example employees in the supply chain) and/or risk of this having a negative impact
on Techstep. We also focus on where we can have a positive impact, especially through our work with
our strategic suppliers and partners. The reporting requirements subject to the Transparency Act is
discussed in the text that follows.
Annual report 2022
44
Policy commitment and governance
Our policies and commitments, which build on internationally proclaimed guidelines for human rights
and labour standards, are approved by the Board and the executive management team. Techstep’s
supplier code of conduct sets out our expectations of suppliers, which are based on the principles of
the Universal Declaration of Human Rights, the International Labour Organisation (ILO) Core
Conventions and UN Global Compact’s 10 principles for sustainable development.
Our Sustainable Procurement policy and procedures, which were revised in 2022, set out the principles
for supplier selection and follow-up, including the steps we take to investigate, analyse and address
potential ESG risks, in accordance with the concepts and principles set forth in the UN Guiding
Principles for Business and Human Rights and the OECD Guidelines for responsible business conduct.
Our sustainability strategy goes however beyond risk management and intends to leverage our
purchasing power to incentivise and promote responsible and sustainable business practices across
the supply chain. Our ambition is to work and collaborate systematically with our suppliers and
business partners, and that they share our commitment to conducting business in an ethical manner.
Techstep’s Risk function is responsible for overseeing supplier due diligence and reporting, and the
ESG and Compliance function is responsible for ensuring that Techstep complies with the Norwegian
Transparency Act. These functions include supporting holistic work with due diligence assessments
and responsible supply chains and subsequent reporting to the executive management, audit
committee and Board. The work involves collaboration with representatives from other parts of the
organisation such as procurement related to customer deliveries, internal IT operations, and security,
depending on relevance. For own operations, regular follow-up of the guidelines for due diligence
assessments is included as part of the Group's risk and compliance work.
Supplier due diligence
Techstep uses a third-party risk management tool to keep an overview of and follow-up partners and
suppliers. Our suppliers are prioritised based on their strategic importance or the size of volume, as
well as context and the supplier’s ties to Techstep and how closely we are linked to the supplier or its
activities.
All potential, new and existing business partners will be subject to regular risk-based due diligence
with respect to environmental, social and governance practices as well as security and economic
considerations, depending upon relevance of the product/service provided. Techstep will primarily do
this through a mix of supplier assessments and supplier self-assessments. “High-risk” suppliers shall
be subject to more in-depth follow-up and assessment, i.e. by obtaining further information from the
supplier concerned or gathering documentation from external sources.
We also look to industry news sources, information provided by industry and NGOs and other relevant
sources to identify possible allegations that could directly affect Techstep’s supply chain and
suppliers. Information obtained will be checked for validity with industry schemes and suppliers
directly and then acted upon according to OECD Guidelines for Multinational Corporations.
Annual report 2022
45
Main findings
An initial mapping of Techstep’s key suppliers has been made to identify potential risks and ensure
compliance with our standards. By having a clear understanding of our supply chain, we can make
informed decisions and take necessary actions to reduce our impact on people and the environment.
Some 20 third party assessments were completed in Q1 2023, by using Techstep’s third-party risk
management system. The suppliers were assessed on questions related to sustainability, social
responsibility, working environment and business conduct. The assessment provides an overall
overview of the supplier, as well as which of these have activities in countries/geographical regions
that entail a higher risk of violations of human rights, labour standards, environmental requirements
or corruption. For suppliers that have a higher “inherent” risk, or where a specific risk is identified, a
more thorough assessment is conducted.
The maturity of sustainability work with our suppliers varies with respect to type of product and service
offered. When it comes to mobile devices and related electronic products, we prioritise working with
suppliers that have a strong commitment to uphold high ethical standards in their operations and
supply chain. 80% of the Tier 1 and 2 electronics manufacturers we resell from are members of the
Responsible Business Alliance (RBA), as well as the RBA-adjacent Responsible Minerals Initiative and
Responsible Labour Initiative, which commits them to support the rights and well-being of workers and
communities worldwide that are affected by the global electronics supply chain. It also ensures that
they have systematic audits and assessments, grievance mechanisms, corrective action processes
and documentation in place.
Of the suppliers assessed, 40% are considered to entail higher inherent risk due to type of products
manufactured, geographical location and complexity of their supply chain. Most of these
manufacturers are headquartered in European countries or the US, while the manufacturing and
assembly processes are mainly located in Asian countries with known social and environmental risks.
In addition, mobile devices contain dozens of different elements and materials, each with a different
supply chain stemming from mined and/or recycled sources. The mining sector has its share of social
and environmental problems, ranging from dangerous working conditions and child labour to poor
wages and pollution. The supply chains are normally very long and complex, often with low
transparency and traceability.
Even though the manufacturers of products we resell have comprehensive programmes to ensure
supply chain responsibility, it appears to be challenging to fully eradicate all risks across the supply
chains – especially at the component and raw material stages. As of the date of this report, we are
not familiar with any confirmed breaches of human rights and labour standards in our supply chain.
At the same time, we recognise that the main risks in the electronics supply chain remains, ranging
from risks of excessive working hours, forced labour, child labour, low wages and income, unsafe work
practices, lack of worker representation and voice.
The due diligence assessments will continue going forward, with a closer follow-up on main risk
suppliers. We further aim to assess all suppliers classified as Tier 1-3 during the year. New suppliers
that sign a contract with Techstep will be subject to a risk assessment before any collaboration
commences.
Annual report 2022
46
Reporting concerns
Techstep’s whistleblower channel is open for both employees and external stakeholders to raise
concerns without fear of retaliation or reprisal and to provide fair investigation. There were no reported
cases during 2022.
Cybersecurity and data privacy
The threat landscape is constantly changing and cyberattacks are getting more and more
sophisticated. Mobile devices increase companies’ efficiency, but can also expose companies to
increased risk, as they are more subject to theft or loss and are often used for both personal and
corporate purposes. To reduce the risk, it’s important to manage all devices properly and in
compliance with applicable laws and regulations.
Information security is an essential part of Techstep’s offerings to our customers and with the
increased focus on software solutions, information security and privacy are natural parts of Techstep’s
product development and operational processes.
Techstep is committed to compliance with applicable laws and regulations. We place a high priority
on protecting and managing data in accordance with accepted standards and helping our
customers utilise our products and services to the same goal.
Over the years, Techstep has established policies, processes, methods, technologies and embraced
proven standards to meet our customers security and privacy requirements. Techstep has
implemented and maintains appropriate technical and organisational measures intended to protect
customer data against unavailability, accidental loss or unauthorised disclosure, access, destruction
or alteration.
Techstep is focusing on raising security awareness in the organisation by performing regular training
for employees and when onboarding new co-workers. Examples of topics we cover in the training
sessions include our security policies, procedures and guidelines, phishing, data protection, incident
reporting and current threats. About 65% of the employees completed the training in 2022, as
attendance was impacted by the downsizing process which took place during the same period.
All information security incidents are handled according to Techstep’s information security incident
management procedure and we have not experienced any incidents related to leak of customer data
in 2022.
Techstep’s Chief Information Security Officer is heading the ongoing process of aligning Techstep’s
information security management system (ISMS) with the newly released ISO/IEC 27001:2022 standard,
and the goal is to get certified by the end of 2023.
Annual report 2022
47
Ethical business conduct
Techstep’s commitment to business ethics and compliance with international regulations and internal
policies is anchored in our code of conduct. The code of conduct provides the framework for
employee’s involvement in ensuring the Group operates in an ethical, sustainable and socially
responsible manner. It specifies the main principles that apply for everyone associated with Techstep
and is intended to guide daily business activities and to be integrated into critical processes, practices,
activities and decision-making across the Group.
All employees are required to review the code of conduct and sign that the content has been read
and understood. Each employee has an individual responsibility to ensure that business practices
adhere to the code of conduct.
Techstep’s code of conduct includes guidance on how to report any concerns related to illegal or
unethical conduct, including a third party operated channel for discrete and confidential handling of
any potential reports. Reported compliance concerns are handled and monitored by the Compliance
function. In 2022, Techstep did not receive any reported concerns.
Techstep takes a zero-tolerance stand to any forms of bribery, money laundering and corruption, as
this undermines any legitimate business. Anti-corruption messaging is communicated to employees
through the code of conduct and related policy. Internal policies and procedures will be further
developed going forward, including a revision of the code of conduct and related training with all
employees.
Annual report 2022
48
Digital literacy and skills in society
Mobile technology carries a huge potential to improve people’s work lives, and make companies more
productive, more profitable and more sustainable, all at the same time.
We believe employees have come to expect the same user experience at work as they enjoy in their
personal lives. This is often not possible as many organisations rely on legacy solutions to administer
devices or do not even provide employees with a mobile device. Techstep’s software solutions
preserve and extend the experience, allowing employees to use mobile devices at work as they do in
their personal lives, while at the same time retaining their privacy and fulfilling IT’s requirements for
deployment, access and security.
To win customers’ trust, we believe it is important to share knowledge and expertise about the
important digitalisation journeys companies must undertake. Through various events and articles, we
seek to educate and inspire people on how to embrace mobile technology as a work tool and prepare
for the future of work. During the year we have successfully arranged our annual Mobile Tech Forum in
Norway and Sweden and held numerous webinars for new and existing customers. Through Techstep,
close to 2 000 people acquired new knowledge that will help them and their organisations on their
digitalisation journey.
Annual report 2022
49
Summary ESG results
2022
2021
8
2020
Climate and environmental impact
Scope 1 - tCO
2
20.2
1.3
8.3
Scope 2 - tCO
2
32.1
32.9
9.4
Scope 3 - tCO
2
11 754
9 657
9.6
Emission intensity - tCO
2
8.9
7.4
na
Circularity
Total units received for end-of-life handing
14 395
15 149
5631
% re-sold to second-hand market
92%
88%
na
Avoided emissions tCO
2
9
832
1 189
na
Employees and working environment
Total number of employees
315
341
289
Number of part-time employees
3
6
12
Turnover rate
24%
13%
na
Employee engagement score (of 10)
7.1
7.4
na
Gender equality
Share of women - Board of Directors
40%
40%
40%
Share of women - Executive management
38%
13%
0%
Share of women - Middle management
10
27%
29%
43%
Share of women - Group total
27%
23%
21%
SHE index score
69
61
63
Health and safety
Sick leave
3.6%
3.5%
3.3%
Occupational injuries
-
-
-
Cybersecurity
Percentage employees completed security training
65%
92%
na
# incidents - leaks of customer data
-
1
na
Compliance
Percentage employees taught cybersecurity
100%
100%
100%
# incidents - leaks of customer data
-
-
1
Management certifications
ISO 9001 (quality) - from Q1 2023
ISO 14001 (environment) - from Q1 2023
8 Figures reported in the annual report for 2021 have beenn restated for scope 2 and 3 due to more accurate data from suppliers.
9 Based on calculations from our reseller partners.
10 Due to internal reorganisations over the last years, the figures are not directly comparable year over year.
Annual report 2022
50
Corporate governance report
Techstep ASA’s principles for good corporate
governance establish the foundation for long-
term value creation to the benefit of all
stakeholders and society at large.
The principles should help inspire trust and
confidence in the company, render decision-
making more effective, and improve
communication between management, the
Board of Directors and the company’s
shareholders.
The principles along with the day-to-day effors
to maintain a healthy corporate culture are
both necessary. Trust and confidence in
Techstep are based on the existence of respect,
responsibility and equality, both internally and
externally.
Implementation and reporting on
corporate governance
Techstep is a Norwegian public limited
company listed on the Euronext Oslo Børs and
subject to corporate governance reporting
requirements according to the Norwegian
Accounting Act section 3-3b, the Oslo Stock
Exchange Rule Book II – Issuer Rules, Chapter
4.4, and the latest version of the Norwegian
Code of Practice for Corporate Governance
(the “Code”), freely available at lovdata.no,
oslobors.no and nues.no, respectively.
The principles and implementation of
corporate governance are subject to annual
reviews and discussions by the company’s
Board of Directors. This report forms part of the
Board of Directors’ report and discusses
Techstep’s main corporate governance policies
and practices and how Techstep has complied
with the Code of Practice in the preceding year.
Application of the Code is based on the “comply
and explain” principle, which stipulates that any
deviations from the Code are explained.
By the company’s own assessment, Techstep
did not have any deviations from the Code of
Practice in 2022.
Business
Techstep is positioning to become the leading
European mobile technology enabler for
customers that want to work smarter and more
sustainably. The company’s operations comply
with the business objective set forth in its
articles of association, section 3:
“The company’s purpose is to engage in
business operations within information and
communication technology, and to develop
and provide solutions and software related to
the mobility, digitalisation and consultancy
business and everything that belongs thereto,
including owning shares and other securities in
other companies.”
The Board of Directors has defined clear goals
and strategies for the company’s business
activities to create value for its shareholders
and to ensure that its resources are utilised in
an efficient and responsible manner. This has
benefits for all its stakeholders. The Board has
further adopted policies setting the standard
for ethical business conduct as well as
responsible business practices with respect to
people, environment and society. The
company’s objectives and strategy, which are
reviewed on an annual basis, are described in
the annual report for 2022, together with a
report on the company’s environmental, social
and governance measures.
Annual report 2022
51
Equity and dividends
As at 31 December 2022, Techstep’s total equity
was NOK 572 million and total liabilities
amounted to NOK 752 million, which
corresponds to an equity ratio of 43%, and a
debt-to-equity ratio of 132%. The Group's
liquidity is closely monitored by management
and the Board of Directors, and the Group has
access to multiple funding sources during the
transformation process should the need arise
going forward.
Techstep has not established a dividend policy
beyond a consensus that the company’s goals
and strategy are to increase shareholder value
and contribute to an attractive market for the
company's shares. Techstep has not paid
dividends to date and does not expect to pay a
dividend in the coming years. Techstep’s
intention is to retain future earnings to finance
operations and expansions of the business. Any
future decision to pay a dividend will depend on
the company's financial position, operating
profit and capital requirements.
Board mandates
Three authorisations were granted to the Board
of Directors at the annual general meeting on 21
April 2022. Following the private placement, it
was considered necessary to replace one of
them by a new authorisation in addition to
granting a new authorisation related to a
subsequent offering. As at 31 December 2022,
the Board has the following authorisations:
●
21.10.2022: Authorisation to increase the
share capital to NOK 60 945 782 in
connection with cash and non-cash
contributions, including mergers. Valid
until AG 2023, but no later than 30 June
2023.
●
21.10.2022: Authorisation to increase the
share capital by NOK 15 000 000 in
connection with a possible subsequent
offering. Amount utilised was NOK
402 160. Valid until AGM 2023, but no
later than June 2023.
●
21.04.2022: Authorisation to increase the
share capital to NOK 16 000 000 in
connection with the Company’s share
incentive programme for its leading
employees. Amount utilised was NOK
854 940. Valid to AGM 2023, but no later
than 30 June 2023.
●
21.04.2022: Authorisation to acquire 10%
of the share capital (treasury shares)
as of March 2022. Valid to AGM 2023, but
no later than June 2023.
There was a separate vote on each of the three
authorisations. For supplementary information
about the authorisations, reference is made to
the minutes of the general meetings held on 21
April and 21 October 2022. These are available
from
Equal treatment of shareholders
and transactions with related
parties
Techstep ASA has one class of shares. Treasury
shares will be traded on the stock exchange or
in accordance with guidelines from Oslo Børs.
According to the Norwegian Public Companies
Act, the company's shareholders have pre-
emption rights in share offerings against cash
contribution. Such pre-emption rights may be
set aside, either by the general meeting or by
the Board based on an authorisation to the
Board. In the event of a capital increase based
on authorisation from the general meeting,
where the pre-emptive rights of shareholders
are set aside, the company will provide the
reasons for the practice in the stock exchange
notice in which the capital increase is
announced. In 2022, Techstep executed a
private placement of NOK 103 million, where the
Annual report 2022
52
shareholders’ pre-emption rights were set
aside partly by an existing board authorisation.
A subsequent repair offering was later carried
out towards existing shareholders not allocated
shares in the private placement, to ensure the
equal treatment of obligations. For details, see
the stock exchange releases dated 29
September and 29 November 2022,
respectively.
Any transactions in treasury shares, i.e., a share
buy-back programme, will be carried out either
through Oslo Børs or otherwise at stock
exchange prevailing prices. If there is limited
liquidity in the company’s shares, the company
will consider other ways to ensure equal
treatment of all shareholders. There were no
transactions in treasury shares during 2022.
For significant transactions with closely related
parties, the company will use valuations and
statements from an independent third party if
the transaction is not to be considered by the
general meeting. There were no such
transactions in 2022. For further information,
refer to 23 - Related party transactions” in the
annual report for 2022.
Freely negotiable shares
The company’s shares are freely negotiable on
the Oslo Børs. There are no restrictions on
owning, trading or voting for shares in the
articles of association.
General meetings
The general meeting is the company's highest
decision-making body. The general meeting is
open to all shareholders, and Techstep
encourages shareholders to participate and
exercise their rights at the company's general
meetings. In order to vote, the shareholder must
be registered with the Norwegian Central
Securities Depository (VPS) at the time of the
general meeting.
Notices of general meetings are sent no later
than 21 days prior to the date of the general
meeting. According to the company’s articles of
association, there is no requirement to send the
documents up for consideration by the general
meeting directly to shareholders as long as the
documents have been made available on the
company’s website. The same applies to
documents that by law are required to be
included in or attached to the notice of the
general meeting. A shareholder may
nonetheless request that relevant documents
concerning business to be transacted at the
general meeting be sent to him or her. The
registration deadline is set as close to the
meeting as possible, and all the necessary
registration information will be provided in the
notice.
Shareholders who are unable to attend may
vote by proxy. Whenever possible, the company
will prepare a proxy form that permits separate
votes for each item up for consideration by the
general meeting.
The Chairman of the Board normally chairs the
general meeting. In the event of disagreements
about individual items, where the Chairman
belongs to one of the factions or is for other
reasons not regarded as impartial, another
Chairperson will be appointed to ensure
impartial treatment of the items up for
consideration at the meeting.
On 21 April 2022, Techstep held its annual
general meeting with 15.92% of the shares
represented. In addition, an extraordinary
general meeting was held on 21 October with
35.98% of the shares represented.
Nomination committee
The nomination committee is governed by the
articles of association section 6. The general
meeting stipulates the guidelines for the duties
of the committee and determines the
Annual report 2022
53
committees’ remuneration. The current
instructions were approved at the annual
general meeting in 2022 and are available from
the company’s website.
The committee nominates candidates for the
Board and the nomination committee, as well
as proposes the Board’s remuneration. Grounds
for nominations by the nomination committee
are provided when nominees are presented to
the general meeting. All shareholders are
entitled to nominate candidates to the Board,
and information on how to propose candidates
can be found on the company’s website.
The current nomination committee was elected
at the extraordinary general meeting on 22
September 2021, and consists of two members,
Kyrre Høydalen (Chair) and Jonatan Raknes.
Both were elected for one term until the annual
general meeting in 2023. Høydalen represents
Datum AS, the company’s largest shareholder
and is a colleague of Board member Harald
Arnet. Raknes is considered independent of the
Board and the Executive Management.
Board of Directors, composition
and independence
The Board of Directors shall consist of three to
seven members as regulated in the articles of
association section 5. The Board and the
Chairman are elected by the general meeting
for two years, and may be re-elected. At the
annual general meeting on 21 April 2022, Anders
Brandt resigned from the Board, and Michael
Jacobs was elected as a new Board member.
The composition of the Board is based on
representation of the company's shareholders,
as well as the company's need for competence,
experience, capacity and ability to form
balanced decisions. Information on each
director’s expertise, background and
capabilities can be found on the company's
website
and on page 46.
All Board members are regarded as
independent in relation to the company's
executive management and material business
contacts. Three of the five Board members are
regarded as independent of the company's
main shareholders. Board members are
encouraged to hold shares in the company.
Annual report 2022
54
Name
Role
Independent
of main
shareholder
Attendance
board
meetings
Served
since
Term
expires
Shares in
Techstep
(direct/indirect)
at 31.12.2022
Jens Rugseth**
Chair
No
13 of 14
11.02.2019
AGM
2023
45 458 104
Ingrid Leisner
Board member
Yes
14 of 14
22.02.2016
AGM
2023
601 562
Melissa Mulholland
Board member
Yes*
13 of 14
22.04.2021
AGM
2023
n.a.
Harald Arnet
Board member
No
13 of 14
22.09.2021
AGM
2023
n.a.
Michael Jacobs**
Board member
Yes
12 of 12
21.04.2022
AGM
2023
n.a.
Anders Brandt
Board member
Yes
1 of 2
26.04.2018
AGM
2022
1 449 690
* Melissa Mulholland is the CEO and Michael Jacbos is the Executive Vice President of the Nordics of Crayon ASA, where Jens
Rugseth is a shareholder and member of the Board
** Michael Jacobs was appointed Chairman of the Board at the extraordinary general Meeting 15. February 2023. Jens Rugseth
took on the role as Board member. Michael is part of the management group of Crayon.
The work of the Board of Directors
The Board of Directors is responsible for
overseeing and supervising the company's
management and operations. The duties and
procedures of the Board are regulated by the
Norwegian Public Limited Liability Companies
Act. In addition, the Board has adopted
supplementary rules of procedure which
provide further regulations on inter alia the
duties of the Board, the Chairman and the CEO,
as well as work, responsibilities, authorisations
and reporting.
The Board is responsible for determining the
company’s overall goals and strategic
direction, principles, risk management and
financial reporting. The Board is also
responsible for ensuring that the company has
competent management with a clear internal
distribution of responsibilities, as well as for
continuously evaluating the performance of the
CEO.
Techstep treats transactions with shareholders,
Board members, employees and other related
parties with due care. To ensure that these
transactions and situations are handled in the
best possible manner, the Board has set clear
guidelines for handling agreements in which a
Board member, or a party related to a Board
member, may have an interest. There was one
such case in 2022, in connection with the
acquisition of Crypho AS. See also note 23 in this
annual report.
The Board of Directors meets as often as
necessary to fulfil its duties, and at least six
times each financial year. The Board of
Directors held 14 Board meetings in 2022 with
88% meeting attendance.
The Board conducts a self-assessment of its
work periodically.
Board committees
The Board of Directors has established three
sub-committees to act as preparatory bodies
for the Board. Members are elected by and
among the Board.
The audit committee acts as a preparatory and
advisory body to the Board with respect to
financial reporting and external audits, risk
management and internal control systems,
corporate governance matters and the
Annual report 2022
55
appointment mandate and remuneration of
the external auditor. As at 31 December 2022,
the audit committee consisted of Board
members Ingrid Leisner and Melissa Mulholland,
both considered as independent of the
company. The audit committee met five times
in 2022.
The M&A committee assists the Board with
tasks related to screening and evaluating
potential M&A candidates and approves
investment analysis and term sheets of
proposed deals. The M&A committee consists of
the Board members Jens Rugseth and Harald
Arnet.
The remuneration committee assists the Board
with tasks related to the company’s
remuneration of Executive Management. As at
31 December 2022, the remuneration
committee consisted of Board members Jens
Rugseth and Ingrid Leisner. The remuneration
committee met two times in 2022.
Risk management and internal
control
The Board is responsible for ensuring that
Techstep has good systems in place for risk
management and internal control. The systems
and procedures for risk management and
internal control shall ensure efficient
operations, timely and correct financial
reporting, and compliance with relevant laws
and regulations. The audit committee meets
annually with the auditor to review the
company’s internal control routines, including
identified weaknesses and areas subject to
improvements. The Board may engage external
expertise if necessary.
During 2022, Techstep has strengthened its
governance, risk and compliance framework,
including policy and procedures for systematic
risk management and internal control. A
management system has been established
based on the ISO standard, with emphasis on
quality, security and environment, to support
day-to-day operations and promote continual
improvement in the organisation. A risk- and
opportunity-based approach is central in the
standard. Risk reviews and reporting are
conducted on a quarterly basis to identify
current and potential risks that need to be
addressed and mitigated. ESG, risk and
compliance are also addressed at monthly
management meetings and quarterly
meetings with the audit committee.
Techstep’s financial accounts are prepared in
accordance with IFRS. The Board receives
monthly management reports on
developments and results related to strategy,
finance, KPIs, projects, challenges and plans for
upcoming periods. In addition, quarterly reports
are prepared in accordance with the
recommendations of the Oslo stock exchange,
which are reviewed by the audit committee
prior approval by the Board of directors and
subsequent publication. The auditor attends
meetings of the audit committee and board
meetings related to the presentation of the
preliminary annual financial statements.
A summary of the company’s main risks is
presented in the Board of Directors’ report and
note 20 Financial risk management in the
annual report for 2022.
Remuneration of the Board of
Directors
The remuneration of Board members is
stipulated annually by the annual general
meeting based on the nomination committee’s
recommendation. The remuneration reflects
the Board of Directors’ responsibilities,
competence, time involved and the complexity
of the business.
A total of NOK 1.6 million was paid in directors’
fees for 2022. Fees paid to each director are
Annual report 2022
56
presented in the remuneration report for 2022,
available from the company’s website
The remuneration of the Board was not
performance based and the company has not
granted share options to any board members.
Members of the audit committee are
remunerated separately. The company does
not provide loans to Board members.
Board members observe general insider
regulations for trading in the company’s shares.
Reference is made to the Remuneration report
2022 for an overview of shares owned by
directors.
Remuneration of executive
personnel
The main principle of Techstep’s executive
remuneration policy is that the remuneration
should be competitive and motivate to attract
and retain executives with the required
competence to strengthen and ensure the
business strategy, long-term interests and
sustainability of Techstep. The executive
remuneration consists of a fixed salary and a
variable part linked to the company’s and the
individual’s achievement, and pension
schemes. Performance-related remuneration is
subject to an absolute limit of 67% of the fixed
salary for the CEO and 45% for the other
executives and assessed on both financial,
non-financial and operational criteria including
sustainability and equality. The corporate
objectives are set by the Board and determined
for and agreed with the CEO. In 2022, the share
option programme for executive management
and certain other employees was extended.
The programme is linked to value creation to
the benefit of shareholders over time. Techstep
also conducted a share purchase programme
where employees were offered the chance to
purchase shares at a discount to the market
price.
The executive remuneration guidelines have
been presented to, and were adopted by, the
annual general meeting on 21 April 2022.
Detailed information about the remuneration of
the executive management team can be found
in the remuneration report for 2022, available
from the company’s website.
Information and communications
Techstep seeks to comply with Euronext Oslo
Børs’ Investor Relations (IR) recommendation,
last revised 1 March 2021.
The Board has adopted an IR policy, which sets
the basic principles for the company’s
communication and dialogue with capital
markets participants, including roles and
responsibilities. The policy is based on the
principles of equal treatment and
transparency, to ensure that stakeholders
receive factual, relevant, timely and
comprehensive information. The policy is
available on the company’s website.
The responsibility for IR lies with the CEO and the
Chairman, supported by the IR team. The IR
team focus on the day-to-day communication
and IR activities, while the Chairman focus on
the shareholders’ expectations related to the
company’s strategic direction and risk
preparedness, as well as issues that require
resolution by the general meeting.
Interim reports are provided on a quarterly
basis, in line with the Oslo stock exchange’s
recommendations. In connection with the
interim reporting, presentations are given to the
open public to provide an overview of the
operational and financial developments,
market outlook and the company’s prospects.
The presentations are made available on the
company’s website.
Annual report 2022
57
All information is primarily provided in English
and is distributed to the company’s
shareholders through Oslo Børs’
Takeovers
The company’s articles of association contain
no defence mechanisms against takeover bids,
nor have other measures been implemented to
specifically hinder the acquisition of shares in
the company.
In the event of a takeover process, the Board
and the executive management shall ensure
that the company’s shareholders are treated
equally, and that the company’s activities are
not unnecessarily interrupted. The Board has a
special responsibility to ensure that the
shareholders have sufficient information and
time to assess the offer.
In addition to complying with relevant
legislation and regulations, the Board will
comply with the recommendations in the Code
if the situation so permits. The Board has
established guiding principles for how it will act
in the event of a takeover bid. The main
principles include that the Board shall not
hinder or obstruct any takeover bid, give
shareholders or others unreasonable
advantages, or protect their personal interests
at the expense of others, and that the Board
shall protect the shareholders’ values and
interests.
If deemed necessary, the Board shall also
ensure a valuation from an independent third-
party. On this basis, the Board will make a
recommendation as to whether the
shareholders should accept the bid.
Auditor
BDO AS has been Techstep’s auditor since its
inception in 2016, and technically for the
company since 2009. The auditor is considered
independent of Techstep, and the Board
receives an annual confirmation from the
auditor that the requirements regarding
independence and objectivity have been
satisfied. The audit committee performs an
annual evaluation of the auditor’s
independence.
The auditor prepares an annual plan for the
implementation of the audit, which is made
known to the audit committee and the Board.
The auditor participates in the Board meeting
dealing with the annual accounts. Here the
auditor presents their views on accounting
matters and principles, risk areas and internal
control. The meeting includes an opportunity for
a review with the Board without the company’s
management present. The auditor participates
in Board meetings at the request off the Board,
as well as all audit committee meetings held in
connection with the quarterly financial
reporting.
The Board of Directors has prepared separate
guidelines for using the auditor for services
other than the audit. All non-audit services
rendered by the Group’s auditor are
preapproved by the audit committee, either
through the guidelines or on a case-by-case
basis.
Remuneration to the auditor is presented to and
approved by the annual general meeting,
including any fees for other specific
assignments if relevant (also see note 27
Remuneration to auditor in the annual report for
2022).
Annual report 2022
58
Consolidated income statement
(Amounts in NOK 1 000)
Notes
2022
2021
Revenue
23
Other revenue
Total revenue
Cost of goods sold
2
(863 007 )
(845 305 )
Salaries and personnel costs
(265 027 )
(281 620 )
Other operational costs
(109 626 )
(108 549 )
Depreciation
9, 10
(109 222 )
(108 229 )
Amortisation
11
(58 492 )
(54 723 )
Other income
6
Other expenses
6
(10 015 )
(17 209 )
Operating profit (loss)
(52 205 )
(110 522 )
Financial income
7
Financial expense
7
(17 565 )
(20 460 )
Profit before tax
(64 170 )
(118 750 )
Income tax
8
(4 445 )
Net income
(68 614 )
(102 660 )
Net income attributable to
Non-controlling interests
Shareholders of Techstep ASA
(68 926 )
(103 050 )
Earnings per share in NOK:
Basic
24
(0.25 )
(0.55 )
Diluted
24
(0.25 )
(0.55 )
Annual report 2022
59
Consolidated statement of comprehensive
income
(Amounts in NOK 1 000)
2022
2021
Net income
(68 614 )
(102 660 )
Items that may be reclassified to profit and loss
Exchange differences on translation of foreign operations
(25 598 )
(21 586 )
Income tax related to these items
(1 304 )
Other comprehensive income
(25 598 )
(22 890 )
Total comprehensive income for the period
(94 212 )
(125 549 )
Total comprehensive income for the period attributable to
Non-controlling interests
Shareholders of Techstep ASA
(94 524 )
(125 939 )
Annual report 2022
60
Consolidated statement of financial position
(Amounts in NOK 1 000)
ASSETS
Note
2022
2021
Non-current assets
Deferred tax asset
8
Goodwill
Customer relations and technology
Total intangible assets
Right of use assets
Property, plant and equipment
10
Total tangible assets
Shares and investments
20
Other non-current assets
20
Total financial assets
Total non-current assets
Inventories
12
Accounts receivable
Other receivables
Total inventories and receivables
Assets classified as held for sale
10, 22
Cash and cash equivalents
14
Total current assets
Total assets
EQUITY AND LIABILITIES
Note
2022
2021
Share capital
25
Other equity
Total equity attributable to the owners of Techstep ASA
Non-controlling interests
22
Total equity
Deferred tax
8
Non-current interest-bearing borrowings
Other non-current debt
9, 16, 20, 22
Total non-current liabilities
Current interest-bearing borrowings
Accounts payable
Tax payable
Public duties
Other current liabilities
9, 15, 17, 20
Total current liabilities
Total liabilities
Total equity and liabilities
Annual report 2022
61
Oslo, 27 April 2023, signatures from the Board of Directors and the CEO of Techstep ASA:
Michael Jacobs
Chairman
Harald Arnet
Board member
Ingrid Leisner
Board member
Jens Rugseth
Board member
Melissa Ann Mulholland
Board member
Børge Astrup
CEO
Annual report 2022
62
Consolidated statement of changes in equity
(Amounts in NOK 1 000)
Note
Share
capital
Other
paid-in
capital
Other
equity
Trans-
lation
reserve
SUM
control
- ling
interest
Total
equity
capital
Equity as at 1 January
2021
(228 313 )
Profit for the period
(103 050 )
-
(103 050 )
(102 660 )
Other comprehensive
income
-
(22 890 )
(22 890 )
(22 890 )
Total comprehensive
income for the period
(103 050 )
(22 890 )
(125 939 )
(125 549 )
Transactions with
owners in their capacity
as owners:
Issue of ordinary shares
as consideration for a
business combination,
net of transaction costs
and tax
22,
25
-
-
Proceeds from issuance
of shares net of
transaction costs
25
Share-based payments
-
Equity as at 31 December
2021
(327 417 )
(6 668 )
Equity as at 1 January
2022
(327 417 )
(6 668 )
Profit for the period
(68 926 )
-
(68 926 )
(68 614 )
Other comprehensive
income
-
(25 598 )
(25 598 )
(25 598 )
Total comprehensive
income for the period
(68 926 )
(25 598 )
(94 523 )
(94 212 )
Annual report 2022
63
Transactions with
owners in their capacity
as owners:
Transactions with non-
controlling interests
(1 585 )
(1 585 )
Issue of ordinary shares
as consideration for a
business combination,
net of transaction costs
and tax
22,
25
-
-
Proceeds from issuance
of shares net of
transaction costs
25
-
Share-based payments
-
Equity as at 31 December
2022
(392 252 )
(32 266 )
Annual report 2022
64
Consolidated statement of cash flow
(Amounts in NOK 1 000)
Note
2022
2021
Profit before tax
(64 170 )
(118 750 )
Depreciation
10
Depreciation right-of-use assets
10
Amortisation
11
Share-based payments
Gain on sale of business reclassified to investment
activities
6
(40 119 )
Gain from sale of PPE reclassified to investment activities
(2 523 )
Net exchange differences
Taxes paid
(996 )
(1 474 )
Interest expense (revenue) reclassified to
investing/financing activities
Changes in net operating working capital core*
Changes in net operating working capital
Net cash flow from operational activities
Payment for acquisition of subsidiaries net of cash
acquired
22
(78 759 )
Payment for equipment and other fixed assets
10
(132 450 )
(141 392 )
Payment for intangible assets
11
(52 250 )
(48 883 )
Proceeds from sale of property, plant and equipment
Proceeds from sale of business
22
Interest received
Net cash used on investment activities
(180 376 )
(174 594 )
Changes in ownership in Subsidiary
22
(9 000 )
Proceeds from issuance of shares
25
Proceeds from borrowings
15
Repayment of borrowings
15
(29 019 )
(41 783 )
Lease repayments
9
(15 423 )
(16 240 )
Interest paid
(11 701 )
(7 731 )
Net cash flow from financing activities
Net change in cash and cash equivalents
Cash and cash equivalents as at 1 January
14
Effects of exchange rate changes on cash and cash
equivalents**
(191 )
(2 433 )
Cash and cash equivalents as at 31 December
14
* comprise changes in accounts receivables, inventories and accounts payables.
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65
Notes to the Group accounts
1. General information and summary of significant accounting policies
How the figures are calculated
2. Segments
3. Revenues from contracts with customers
4. Payroll
5. Other operational costs
6. Other income
7. Financial income and expenses
8. Tax
9. Leases
10. Tangible Assets
11. Intangible assets
12. Inventories
13. Trade receivables and other receivables
14. Cash and cash equivalents
15. Borrowings
16. Other non-current debt
17. Other current liabilities
Risk
18. Critical estimates
19. Impairment of intangible assets
20. Financial risk management
21. Legal disputes and contingencies
Group structure
22. Changes in Group structure and business combinations
Other
23. Related party transactions
24. Earnings per share
25. Shares, capital structure and shareholders
26. Group structure
27. Remuneration to auditor
28. Remuneration to the board and executive management
29. Events after the reporting period
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66
Notes to the consolidated financial statements
Note 1. General information and summary of significant accounting policies
.
The address of its registered office is
. The shares are listed on the Oslo
Stock Exchange under the TECH ticker. The Techstep Group (Group) consists of
subsidiaries.
Techstep Group is a Nordic enabler of the mobile workplace, delivering a full range of hardware and
services to facilitate mobile workplaces.
The consolidated financial statements for Techstep Group for the year 2022 were approved by the
Board of Directors on 27 April 2023 and will be presented for approval by the Annual General Meeting
on 23 May 2023.
1.1 Basis for preparation
The consolidated financial statements have been prepared and presented in accordance with the
International Financial Reporting Standards (IFRS) as adopted by the EU. The financial statements
have been prepared on a historical cost basis, except for shares and investments that have been
measured at fair value.
1.2 Change in accounting principles
There are no new or amended accounting standards that required the Group to change its accounting
policies for the 2022 financial year.
1.3 Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured in the currency
of the primary economic environment in which the entity operates (‘the functional currency’). The
consolidated financial statements are presented in NOK, which is Techstep ASA’s functional and
presentation currency. The figures presented in the annual accounts are in NOK thousand unless
otherwise stated.
1.4 Consolidation principles and subsidiaries
Subsidiaries
The consolidated financial statements incorporate the financial statements of Techstep ASA (the
Company) and entities controlled by the Company (its subsidiaries). The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries
are fully consolidated from the date on which control is transferred to the Group.
The income and expenses of Group subsidiaries acquired or disposed of during the year, are included
in the consolidated income statement from the effective date of acquisition and up to the effective
date of disposal, as appropriate.
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67
Intercompany transactions, balances and gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated, unless the transaction provides evidence of an
impairment of the transferred asset.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the
consolidated income statement, the consolidated statement of comprehensive income, statement of
changes in equity, and the consolidated statement of financial position, respectively.
1.5 Transactions in foreign currencies
Transactions and balances
Foreign currency transactions are converted into the functional currency, using the exchange rates
on the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of
such transactions, and from the conversion of monetary assets and liabilities denominated in foreign
currencies at year-end exchange rates, are recognised in the consolidated income statement.
Foreign exchange gains and losses are presented in the consolidated income statement, as financial
expenses.
Group companies
The results and financial position of foreign operations that have a functional currency that is different
from the presentation currency, are converted into the presentation currency as follows:
●
Assets and liabilities for each balance sheet presented are translated at the closing rate on
the date of that balance sheet.
●
Income and expenses for the consolidated income statement and statement of
comprehensive income are translated at average exchange rates (unless this is not a
reasonable approximation of the cumulative effect of the rates prevailing on the transaction
dates, in which case income and expenses are converted on the dates of the transactions).
●
All resulting exchange rate differences are recognised in other comprehensive income.
When consolidated, translation differences arising from the translation of net investment in foreign
entities are recognised in other comprehensive income.
Goodwill and fair value adjustments arising from the acquisition of a foreign operation are treated as
the assets and liabilities of the foreign operation and converted at the closing rate.
1.6 Revenue recognition
Revenue from contracts with customers is recognised when a performance obligation in the contract
is satisfied. The amount recognised reflects the consideration to which the Group expects to be
entitled in exchange for those goods and services. For contracts with several performance obligations,
the transaction price is allocated to each performance obligation on a relative stand-alone selling
price basis.
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68
Revenue from hardware sales
A major part of the Group’s revenue arises from the sale of hardware to its customers. The delivery of
the hardware in question is identified as the performance obligation. The customers obtain control of
the hardware when the item is shipped to the customers. Revenue is recognised at the time of
shipment as the performance obligations are then satisfied.
The sale of certain items of hardware triggers a right to a bonus from partners and suppliers. Bonuses
accounted for as revenue are driven by volumes sold of the underlying item. Bonuses are recognised
as revenue when the performance obligations for the sale of hardware are satisfied.
Revenue from Advisory & Service
Revenue from Advisory & Services includes revenues from support and maintenance services to its
customers. These services are organised as subscription programmes where the customers have
access to support and maintenance for a monthly fee. The performance obligations related to support
and maintenance are satisfied on an ongoing basis, and revenue related to the sales of services are
thus recognised on a linear basis over time.
The sale of support and maintenance that exceed the subscription programme is recognised as
revenue based on time and material.
Revenue from Advisory & Services also includes sales of 3. party software licenses. Management has
assessed the customer contracts related to software licenses and have found the sale of software
licenses to be distinct performance obligations as software licenses. Customers can benefit from the
license on its own and it can be a stand-alone delivery with no other goods or services.
The Group provides both right-to-use licenses and right-to-access licenses.
For right-to-use licenses, the performance obligation is satisfied when the customer gains access to
the software license, and revenue from the sale of licenses is thus recognised at the point in time when
the software is transferred to the customer.
For right-to-access licences the performance obligation is satisfied over time.
The sale of certain of licenses triggers a right to a commission from partners and suppliers. The
commissions accounted for as revenue are driven by volumes sold of the underlying item.
Commissions are recognised as revenue when the performance obligations for the sale of the license
is satisfied.
Own Software
The Group develops and sells own software. The customer buys a right to access the software
developed by Techstep. The performance obligation is satisfied over time.
Bundles
As a part of several product bundles and as a stand-alone product, the Group offers a leasing
alternative to customers (Hardware-as-a-service). The Group uses external funding to finance the
offering. The Group sells the devices up front to an external funder and receives payment in full. The
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69
devices are delivered to the end-users, and the end users are invoiced over the contract period from
the funder. The Group has no credit risk related to the end user. The funder is in the following
description the customer.
The Group has contracts with customers whereupon the customer can, at the end of the contract
period, require that the Group repurchases the devices at a predetermined price. This price is always
lower than the original selling price.
When the Group enters into contracts containing repurchase-options management assesses
whether or not the customer has a significant economic incentive to utilise the option. Where it is
determined that the customer has a significant economic incentive to utilise the option, the contract
is determined to be a lease and the transaction is accounted for as a lease in accordance with IFRS
16.
Leasing - Lessor accounting
For each leasing contract the Group enters into with customers, management assesses whether the
contract shall be classified as an operational or financial lease based on the substance of the
transaction. As at the balance sheet date, the Group only has operational lease contracts with
customers.
Leasing contracts with repurchase agreements are accounted for as operating leases with rentals
payable up front at the inception of the lease. There are no other variable lease payments. The
repurchase obligation is fixed at the inception of the lease. At the end of the lease period the Group
expects to repurchase the devices from the customer.
Payment received from the customer is accounted for as deferred revenue and recognised as
revenue on a straight-line basis over the lease term, less the agreed-upon residual value (repurchase
amount).
The respective leased assets are included in the balance sheet based on their nature and depreciated
over the lease term to the expected second-hand market value.
1.7 Other income and other expenses
Other income and expenses of a special nature are presented in the separate line items “Other income
and other expenses within operating profit (loss)” respectively. Such items are characterised by being
of a non-recurring nature and outside ordinary business of Techstep Group. Other income and
expenses will include items such as restructuring costs related to executive management, acquisition-
related costs, gains or losses on the both sale and remeasurement of assets or liabilities. Acquisition-
related costs may include both costs related to acquisitions closed and transactions that were not
completed.
1.8 Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration
transferred in a business combination is measured at fair value, which is calculated as the sum of the
acquisition-date fair value of the assets transferred by the Group, liabilities incurred by the Group in
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relation to the former owners of the acquiree, and the equity interests issued by the Group in exchange
for control of the acquiree. Acquisition-related costs are expensed as incurred.
On the acquisition date, the identifiable assets acquired, and the liabilities assumed are recognised
at their fair value, except for:
●
Deferred tax assets or liabilities are recognised and measured in accordance with IAS 12 -
Income taxes.
●
Liabilities or assets related to employee benefit arrangements are recognised and measured
in accordance with IAS 19 - Employee benefits.
The Group recognises any non-controlling interest in the acquired entity on an acquisition-by-
acquisition basis, at the non-controlling interest’s proportionate share of the acquired entity’s net
identifiable assets.
Goodwill is measured as the excess of the consideration transferred, the amount of any non-
controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest
in the acquiree (if any), over the net of the acquisition-date amounts of the identifiable assets
acquired and the liabilities assumed.
Where settlement of any part of a cash consideration is deferred, the amounts payable in the future
are discounted to their present value as at the date of exchange. The discount rate used is the entity’s
incremental borrowing rate, i.e. the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
Changes in the fair value of the contingent consideration that qualify as measurement period
adjustments, are adjusted retrospectively, with corresponding adjustments against goodwill. The
measurement period cannot exceed one year from the acquisition date. Measurement period
adjustments are adjustments that arise from additional information obtained during the
measurement period about facts and circumstances that existed on the acquisition date.
Changes in the fair value of contingent consideration not classified as equity that does not qualify as
a measurement period adjustment are remeasured at subsequent reporting dates. The
corresponding gain or loss is recognised in the consolidated income statement on the line items Other
income or other expenses as appropriate.
When a business combination is achieved in stages, the Group’s previously held equity interest in the
acquiree is remeasured at fair value on the acquisition date (i.e. the date when the Group obtains
control) and the resulting gain or loss, if any, is recognised in the consolidated income statement.
Amounts arising from interests in the acquiree prior to the acquisition date that have been previously
recognised in other comprehensive income, are reclassified to the consolidated income statement
where such treatment would be appropriate.
1.9 Intangible assets
Intangible assets with finite useful lives that are acquired separately, are carried at cost less
accumulated amortisation and accumulated impairment losses. Amortisation is recognised on a
straight-line basis over their estimated useful lives. The estimated useful life and amortisation method
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71
is reviewed at the end of each reporting period, with the effect of any changes on estimates being
accounted for on a prospective basis.
Intangible assets with indefinite useful lives that are acquired separately, are carried at cost less
accumulated impairment losses.
The costs of intangible assets acquired through acquisitions are recorded at fair value as at the date
of acquisition.
Software expenses related to the purchase of new computer programmes are accounted for as an
intangible asset if these expenses are not part of hardware acquisition costs. Costs incurred due to
updates and general maintenance of the software, are accounted for as running costs over the
income statement, unless the changes in the software increase the future economic benefits from the
software.
1.10 Property, plant and equipment
Property, plant and equipment are carried at cost less accumulated depreciation and accumulated
impairment losses.
The cost of the asset, less its estimated residual value, is depreciated on a straight-line basis over the
estimated useful life of the asset. Estimates of residual values are applicable for the Group’s leasing
offering where assets are sold at the end of the lease. The estimated useful lives, residual values and
depreciation methods are reviewed at the end of each reporting period, with the effect of any changes
in estimates accounted for on a prospective basis.
An item of property, plant and equipment is derecognised upon disposal, or when no future economic
benefits are expected to arise from the continued use of the asset. Any gain or loss that arises on the
disposal or retirement of an item of property, plant and equipment is determined as the difference
between the sales proceeds and the carrying amount of the asset and is recognised in the income
statement.
1.11 Impairment of intangible assets and property, plant and equipment
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and
are tested annually for impairment, or more frequently if events or changes in circumstances indicate
that the carrying amount might be impaired. Other assets are tested for impairment whenever events
or changes in circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognised as the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of
disposal, and value in use. For the purposes of assessing impairment, assets are grouped at the lowest
levels for which there are separately identifiable cash inflows which are largely independent of the
cash inflows from other assets or Groups of assets (cash-generating units). Non-financial assets,
other than goodwill, that have historically been impaired are reviewed for possible reversal of the
impairment at the end of each reporting period.
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1.12 Inventories
Inventories are measured at the lower of cost and net realisable value. Cost is determined using the
FIFO or weighted average method, depending on the nature of the inventories.
1.13 Trade receivables
Trade receivables are initially measured at fair value and subsequently measured at amortised cost
using the effective interest method, less provision for impairment. The carrying amount of a trade
receivable is written off when the Group has no reasonable expectations of recovering the trade
receivable in its entirety or a portion thereof.
1.14 Cash and cash equivalents
Cash and cash equivalents in the consolidated statement of financial position comprise all cash and
bank deposits.
1.15 Financial instruments
Financial assets and liabilities include investment in shares, trade receivables, other receivables,
borrowings, trade payables, other current and non-current liabilities.
Financial assets and financial liabilities) are recognised initially on the date when the Group becomes
a party to the contractual provisions of the instrument.
The Group classifies, at initial recognition, its financial instruments in one of the following categories:
●
Financial assets or financial liabilities at fair value through profit or loss,
●
Financial asset at amortised cost,
●
Financial liabilities at amortised cost
The classification depends on the Group’s business model for managing them and the contractual
cash-flow characteristics of the instrument.
Financial assets or financial liabilities at fair value through profit or loss are financial assets and
liabilities held for trading and acquired primarily with a view of selling in the near term.
Financial assets at amortised cost are financial assets held to collect the contractual cash flow and
where the cash flows are solely payment of principal and interest on the outstanding principal. The
category is included in the consolidated statement of financial position financial line items Other non-
current assets, Trade receivables, Other receivables and Cash and cash equivalents. Financial assets
at amortised cost are recognised initially at fair value plus directly attributable transaction costs.
Subsequently, if the asset is non-current it is measured at amortised cost using the effective interest
method, reduced by any impairment loss. The carrying amounts of line items classified as current are
assumed to be the same as their fair values, due to their short-term nature. Short-term loans and
receivables are for practical reasons not amortised unless the effect is material.
The category financial liabilities at amortised cost is included in the consolidated statement of
financial position line items Non-current interest-bearing borrowings, Other non-current debt, Current
interest-bearing borrowings, Trade payables and Other current liabilities. Items in the Other financial
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73
liabilities-category are recognised initially at fair value. Subsequently, if they are non-current, other
financial liabilities are measured at amortised cost using the effective interest method. Effective
interest is recognised in the income statement as financial expenses. Current items in the category
are for practical reasons not amortised unless the effect is material.
Financial assets are derecognised when the contractual rights to the cash flows from the financial
asset expire and the Group has transferred substantially all the risks and rewards of ownership.
Financial liabilities are derecognised when the obligation is discharged, cancelled, or expires. Any
rights and obligations created or retained in such a transfer are recognised separately as assets or
liabilities. The Group assesses quarterly whether there is objective evidence that a financial asset or
Group of financial assets is impaired.
For trade and other receivables, default in payments, significant financial difficulties of the debtor,
probability that the debtor will enter bankruptcy or debt settlement negotiations are considered to be
indicators that the Group will not be able to collect all amounts due according to the original terms of
the receivables. For trade receivables the loss allowance is measured at the lifetime expected credit
loss. The loss is recognised as other operating expenses in the income statement.
The fair value of financial instruments is based on quoted prices as at the balance sheet date in an
active market, if such markets exist. If an active market does not exist, fair value is established by using
valuation techniques that are expected to provide a reliable estimate of the fair value. The fair value
of unlisted securities is based on cash flows discounted using an applicable risk-free market interest
rate and a risk premium specific to the unlisted securities.
Financial assets and liabilities measured at fair value are classified according to the valuation
method:
Level 1: Valuation based on quoted prices (unadjusted) in active markets for identical assets or
liabilities.
Level 2: Valuation based on inputs other than quoted prices included within level 1 that are observable
for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).
Level 3: Valuation based on inputs for the asset or liability that are unobservable market data.
If one or more of the significant inputs are not based on observable market data, the instrument is
included in level 3. Changes in fair value recognised in other comprehensive income are recognised
in the line-item Exchange differences on converting foreign operations. Changes in fair value
recognised in profit or loss are presented in the line item, Financial expenses and Other income and
expenses.
1.16 Accounts payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of
the balance sheet date which are unpaid. The amounts are unsecured payables and are usually paid
within 30 days of recognition. Trade and other payables are presented as trade payables, unless
payment is not due within 12 months of the reporting period. They are recognised initially at their fair
value and subsequently measured at amortised cost using the effective interest method.
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1.17 Dividend and interest income
Dividend income from investments is recognised when the shareholder’s right to receive payment has
been established (provided it is probable that the economic benefits will flow to the Group and the
amount of income can be measured reliably).
1.18 Income tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable
income, based on the applicable income tax rate for each jurisdiction, adjusted for changes in
deferred tax assets and liabilities attributable to temporary differences, and for unused tax losses.
Tax payable
The current income tax charge is calculated based on the tax laws enacted, or substantively enacted,
at the end of the reporting period in Norway, Sweden, Denmark and Poland, where subsidiaries
generate taxable income. Management periodically evaluates positions taken in tax returns, with
respect to situations in which applicable tax regulation is subject to interpretation. Management
establishes provisions where appropriate, based on amounts expected to be paid to the tax
authorities.
Deferred tax
Deferred income tax is provided on temporary differences arising between the tax bases of assets and
liabilities, and their carrying amounts in the consolidated financial statements. However, deferred tax
liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax
is determined using tax rates (and laws) that have been enacted, or substantially enacted, by the end
of the reporting period, and are expected to apply when the related deferred income tax asset is
realised, or the deferred income tax liability is settled.
Deferred tax assets are recognised only if it is probable that future taxable amounts will be available
to utilise the temporary differences and losses.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current
tax assets and liabilities, and when the deferred tax balances relate to the same taxation authority.
Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset
and intends to either settle on a net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in the income statement, except to the extent that it relates to
items recognised in other comprehensive income, or directly in equity. In this case, the tax is also
recognised in other comprehensive income or directly in equity, respectively.
1.19 Equity
The nominal value of treasury shares is reported in the balance sheet, as a deduction to other equity.
Transaction costs in relation to equity transactions are charged to equity after deducting tax.
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1.20 Share-based payments
Share-based payments are part of the remuneration to executive management and other key
personnel.
The fair value of options granted is recognised as an employee benefit expense with a corresponding
increase in equity. The total amount to be expensed is determined by reference to the fair value of the
options granted.
The total expense is recognised over the vesting period, which is the period over which the vesting
conditions are satisfied. At the end of each period, the estimate of the number of options that are
expected to vest based on the non-market vesting and service conditions is revised. The revision, if
any, of the original estimates is recognised in the income statement, with a corresponding adjustment
to equity.
Social security tax is provided for at each balance sheet date based on the intrinsic value of the
options.
1.21 Retirement benefit plan
The Group has defined contribution plans. A defined contribution plan is a retirement plan in which
the Group pays fixed contributions to a separate legal entity. The Group has no legal or other obligation
to pay additional contributions if the entity does not have sufficient assets to pay all employee benefits
associated with earnings in present and previous periods. Pre-paid contributions are recorded in the
accounts as an asset, to the extent the contribution may be refunded or may reduce future
contributions.
1.22 Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are
subsequently measured at amortised cost.
1.23 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that the Group will be required to settle the obligation, and a reliable
estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the
present obligation at the end of the reporting period, and considers the risks and uncertainties
surrounding the obligation. When a provision is measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present value of those cash flows (where the effect of
the time value of money is material).
When some or all the economic benefits required to settle a provision are expected to be recovered
from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement
will be received, and the amount of the receivable can be measured reliably.
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1.24 Cash flow statement
The cash flow statement is presented using the indirect method. The Group’s activities are divided into
operational, investment and financing activities. Cash investment in new business is classified as
payment for the acquisition of subsidiaries, net of cash acquired in the cash flow statement.
1.25 Segment information
The division into operating segments corresponds to the management structure and the internal
reporting to the Group’s chief operating decision maker (CODM), defined as the CEO. Companies are
allocated to a segment based on the geographical location of the company.
1.26 Leasing
All leases are accounted for by recognising a right-of-use asset and a lease liability except for:
●
Leases of low value assets; and
●
Leases with a duration of 12 months or less
Lease liabilities
Lease liabilities are measured at the present value of the contractual payments due to the lessor over
the lease term, with the discount rate determined by reference to the rate inherent in the lease. If the
inherent interest rate is not readily determinable, the Group’s incremental borrowing rate on
commencement of the lease is used. Variable lease payments are only included in the measurement
of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the
lease liability assumes the variable element will be regulated throughout the lease term. The estimate
is based upon management judgement. On initial recognition, the carrying value of the lease liability
will include the following if applicable:
●
The exercise price of any purchase option granted in favour of the Group if it is reasonably
certain to exercise that option;
●
Any penalties payable for terminating the lease, if the term of the lease has been estimated
based on the termination option being exercised.
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a
constant rate on the balance outstanding and are reduced for lease payments made.
Right-of-use assets
Right-of-use assets are initially measured at the amount of the lease liability.
Right-of-use assets are depreciated on a straight-line basis over the remaining term of the lease. The
remaining term of the lease is for all leases held by the Group assessed to be equal to the economic
life of the asset.
Leases of low value assets and short-term leases
Payments associated with short-term leases of equipment and vehicles and all leases of low-value
assets are recognised on a straight-line basis as an expense in profit or loss on the financial statement
line item Other operational costs. Short-term leases are leases with a lease term of 12 months or less.
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1.27 Use of estimates in the preparation of financial statements
Management has used estimates and assumptions that affect the assets, liabilities, revenues,
expenses and information regarding potential liabilities. Future events may lead to the estimates
changing. Estimates and underlying assumptions are assessed continuously. Changes in accounting
estimates are recognised in the period when the change occurs.
See Note 18 for a description of assets and liabilities subject to significant estimation uncertainty.
1.28 Earnings per share
i) Basic earnings per share
Basic earnings per share are calculated by dividing:
●
The profit attributable to owners of the company, excluding any costs of servicing equity other
than ordinary shares.
●
By the weighted average number of ordinary shares outstanding during the financial year,
excluding treasury shares.
ii) Diluted earnings per share
Diluted earnings per share adjust the figures used in the determination of basic earnings per share, to
take into account:
●
The after-income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares, and
●
The weighted average number of additional ordinary shares that would have been
outstanding, assuming the conversion of all dilutive potential ordinary shares.
As at year end 2022 the Group has options outstanding that are in the money. Basic earnings per share
and diluted earnings per share therefore differ.
1.29 Government grants
Government grants, including the Norwegian Skattefunn tax incentive scheme, are recognised in the
same year as the government grants are received. Grants are recognised as deductions against the
costs that they are intended to compensate.
Investment grants are capitalised and recognised systematically over the asset’s useful life.
Investment grants are recognised either as deferred income or as a deduction of the asset’s carrying
amount.
1.30 New standards and interpretations not yet effective
The Group has elected not to early-adopt any standards or interpretations that have an effective date
after the balance sheet date. Standards and amendments that are issued, but not yet effective, are
not expected to have a material effect on the Group’s financial statements.
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Note 2. Segments
Techstep has four segments, which are represented by the four geographic locations where the
Group's entities are incorporated. The entities are controlled and owned by the Techstep Group. The
segment HQ comprises Techstep ASA.
Eliminations comprise intersegment sales. Transactions between operating segments are conducted
on normal commercial terms.
1) Norway
●
Techstep Norway AS: The offerings of the company are mobile hardware, servicing, support
and mobility consultancy services. The company is located in Oslo and Sandefjord.
●
Mytos AS: A Norwegian-based software as a services company with mainly recurring revenue.
Mytos offers a full range of mobile expense management (TEM) modules, all with proprietary
software and highly user-friendly implementation and operation. The company is located in
Oslo.
●
Techstep Finance AS: Provides financing and remarketing services. The company is located in
Oslo.
2) Sweden
●
Techstep AB (formerly Techstep Sweden AB and Optidev AB): The company offers mobile
hardware, mobility consultancy services and Enterprise Mobility Management (EMM) services,
including Mobile Security, system design, implementation, mobile device management. The
company also develops and provides enterprise mobility software and solutions,
predominantly to customers in the transportation, logistics and public safety sectors in
Sweden, Norway and Denmark. The company is located in Karlstad, Borås Gothenburg and
Stockholm.
●
Techstep Finance AB: Provides financing and remarketing services.
3) Denmark
●
Techstep Denmark ApS: Established to invoice Danish customers. The company is fully
supported from Norway and does not have any employees.
●
Optidev ApS: Established as a sales office for Techstep AB (formerly Optidev AB).
4) Poland
●
Famoc S.A.: A Polish software-as-a-services company with mainly recurring revenue. Famoc
offers a portfolio of solutions for the mobile device lifecycle management market. The
company is located in Gdansk.
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●
Famoc Software Ltd: An Ireland based company acting as a reseller of Famoc S.A. software to
customers outside Poland.
●
Santa Maria Private Ventures sp. z.o.o.: A holding company owning shares in Famoc S.A. and
Famoc Software sp. z.o.o.
5) Headquarters (HQ)
●
Techstep ASA
FY 2022
Norway
Sweden
Denmark
Poland
HQ
Elim-
inations
Total
Operating revenues from external
customers
787 272
476 582
34 794
24 478
-
-
1 323 126
Operating revenues from other segments
32 881
41 588
-
3 448
67 555
(145 473)
-
Operating revenues
820 153
518 170
34 794
27 926
67 555
(145 473)
1 323 126
Cost of goods sold
(539 551)
(324 274)
(27 806)
(7 779)
-
36 403
(863 007)
Salaries and personnel costs
(89 565)
(111 032)
(2 356)
(7 831)
(60 936)
6 693
(265 027)
Other operational costs
(97 750)
(55 148)
(1 703)
(7 878)
(46 277)
99 130
(109 626)
Depreciation
(60 761)
(42 142)
(1 166)
(766)
(4 387)
-
(109 222)
Amortisation
(22 054)
(23 685)
-
(8 655)
(4 107)
9
(58 492)
Impairment
-
-
-
-
-
-
-
Other income
19 600
20 047
-
165
246
-
40 058
Other expenses
(4 900)
(2 360)
(76)
(388)
(2 292)
-
(10 015)
Operating profit (loss)
25 171
(20 423)
1 687
(5 206)
(50 197)
(3 238)
(52 205)
Financial income
(35 122)
19
0
41
45 127
(4 465)
5 601
Financial expenses
(2 965)
(4 317)
(87)
(109)
(42 914)
32 827
(17 565)
Profit (loss) before tax
(12 915)
(24 721)
1 600
(5 275)
(47 983)
25 124
(64 170)
FY 2021
Norway
Sweden
Denmark
Poland
HQ
Elim-
inations
Total
Operating revenues from external
customers
813 205
435 838
41 441
14 607
-
-
1 305 090
Operating revenues from other segments
72 317
41 404
7
2 718
37 148
(153 593)
-
Operating revenues
885 522
477 241
41 448
17 325
37 148
(153 593)
1 305 090
Cost of goods sold
(573 144)
(280 461)
(34 671)
(6 770)
-
49 741
(845 305)
Salaries and personnel costs
(130 854)
(115 246)
(2 981)
(8 540)
(24 549)
550
(281 620)
Other operational costs
(54 309)
(44 341)
(1 121)
3 108
(87 220)
75 334
(108 549)
Depreciation
(69 208)
(38 139)
(473)
(403)
(6)
-
(108 229)
Amortisation
(20 118)
(27 709)
-
(6 896)
-
-
(54 723)
Impairment
(3 815)
-
-
-
-
3 815
-
Other income
-
-
-
22
-
-
22
Other expenses
(6 728)
-
-
(0)
(9 716)
(764)
(17 209)
Operating profit (loss)
27 346
(28 655)
2 202
(2 155)
(84 344)
(24 917)
(110 522)
Financial income
(34 758)
(104)
3
4
75 879
(28 792)
12 232
Financial expenses
(4 591)
(3 112)
(106)
(4)
(15 536)
2 890
(20 460)
Profit (loss) before tax
(12 003)
(31 871)
2 099
(2 155)
(24 001)
(50 820)
(118 750)
Annual report 2022
80
Operating revenues and non-current assets by geographical area
In the presentation of geographical information, the operating revenues are attributed according to
the location of Group companies. There are no significant differences between the attribution of
operating revenues based on the locations of the Group companies, and an attribution based on the
customers' location. Non-current assets are attributed based on the geographical location of the
assets.
Non-current assets
2022
2021
Norway
562 482
511 701
Sweden
326 032
348 700
Denmark
1 331
1 388
Poland
101 332
96 979
Total
991 176
958 768
xx
Note 3. Revenues from contracts with customers
In the following tables, Total revenue is disaggregated by major revenue streams divided into the
reportable segments as shown in Note 2.
Hardware revenue comprises hardware and related bonuses. Bonus are additional revenues related
to hardware sales.
Solutions revenue comprises own software, third party licenses, consulting services and related
commissions. Commissions are related to services rendered to third party connection providers.
2022
Norway
Sweden
Denmark
Poland
HQ
Eliminations
Group
Total revenues
820 154
518 170
34 794
27 926
67 555
-145 474
1 323 126
Hardware
Hardware revenues
531 897
252 711
16 372
477
0
-16 313
785 144
Leasing
87 966
54 657
5 587
0
0
-5 185
143 026
Bonus
41 766
7 708
0
0
0
0
49 473
Total
661 629
315 076
21 960
477
0
-21 498
977 643
Solutions
Advisory & Services
69 914
170 988
12 307
306
0
-12 735
240 780
Own Software
44 164
25 247
669
27 143
0
-5 631
91 593
Total
114 078
196 235
12 976
27 449
0
-18 366
332 372
Other revenues
Commission*
13 036
64
0
0
0
0
13 100
Other
31 412
6 796
-142
0
67 555
-105 609
11
Total
44 448
6 859
-142
0
67 555
-105 609
13 111
*reclassified from Solutions
Annual report 2022
81
2021*
Norway
Sweden
Denmark
Poland
HQ
Eliminations
Group
Total revenues
789 491
456 826
41 448
17 325
58 360
-58 360
1 305 090
Hardware
Hardware revenues
524 718
221 641
24 790
365
0
0
771 513
Leasing
82 947
46 557
4 732
0
0
0
134 237
Bonus
37 044
12 119
0
0
0
0
49 163
Total
644 709
280 317
29 522
365
0
0
954 912
Solutions
Advisory & Services
86 400
155 216
11 255
1 458
0
0
254 329
Own Software
39 090
18 505
689
15 503
0
0
73 787
Total
125 490
173 721
11 944
16 960
0
0
328 116
Other revenues
Commission**
17 791
2 372
0
0
0
0
20 164
Other
1 501
415
-18
0
58 360
-58 360
1 898
Total
19 292
2 788
-18
0
58 360
-58 360
22 062
*The above table is restated in accordance with new segment reporting
**reclassified from Solution
Contract assets and contract liabilities
Most of the Group's solution revenues are annual. The majority of the contracts follows the calendar
year. The contract assets and liabilities related to Solutions as at the balance sheet date are therefore
immaterial. This also applies to the unfulfilled performance obligations.
Sale of hardware and licenses does not lead to material contract assets or liabilities.
Contract assets and liabilities originate from sale of support. Customers are invoiced in advance for
monthly or quarterly support subscriptions. The Group also has customers who are invoiced after the
services are rendered, monthly or annually. Contracts assets and liabilities vary to an extent
throughout the reporting period.
Other arrangements with customers do exist but are deemed immaterial.
Deferred revenue
The Group's revenue from sale of hardware is divided into two streams: The customer purchases the
hardware and the performance obligation is settled when the hardware is delivered, or the customer
enters into a leasing agreement, where the hardware will be returned at the end of the lease.
The contracts where the Group acts as a lessor last from 18 - 36 months. Revenue is recognised linearly
over the contract period as the performance obligation is settled.
Annual report 2022
82
At the commencement of the lease agreements the Group receives full settlement from the financing
partners as described under section 1.6
Revenue recognition
in the accounting policies
.
received is split between deferred revenue specified below, and residual obligation (amount to be
repaid). The residual obligation is specified in note 16 (non-current) and note 17 (current)
Changes in deferred revenue during the year
2022
2021
Opening balance deferred revenue as at 1 January
135 320
78 783
Additions from business combinations
0
0
Net movement
16 800
57 190
Translation differences
(552)
(653)
Closing balance deferred revenue as at 31 December
151 568
135 320
Of the total deferred revenue as at 31 December 2022, NOK 50.9 million will be recognised in 2024 or
later.
The material amount in deferred revenue is related to contracts with customers where the customer
has a return option and management’s assessment is that this option will be utilised. Such contracts
are accounted for as operational leases, where the Group is the lessor.
Payment terms and customer base
Customers have payment terms varying from 15-90 days.
Of the Group's total customer base as at 31 December 2022, the five largest customers represent
approximately 24 % (21 %) of total revenue in 2022, and the ten largest customers represent
approximately 31 % (27 %) of total revenue. Figures for 2021 is restated in order to be comparable to
2022 figures.
Unsatisfied performance obligations
The Group has unsatisfied performance obligations resulting from fixed price long-term contracts
such as Smart Device and Smart Works. The unsatisfied performance obligations are satisfied through
passage of time. As at the balance sheet date the Group’s unsatisfied performance obligations were
NOK 151.6 million of which NOK 100.7 million will be accounted for as revenue in 2023. The remaining
balance will be accounted for as revenue in 2024 or later.
The amounts disclosed do not include variable considerations.
The Group’s Annual Recurring Revenue metric, refer to Alternative performance measures, is a part of
the unsatisfied performance obligations disclosed above until the earliest possible cancellation date
for the customer. The disclosed ARR figure and the unsatisfied performance obligations are therefore
not directly comparable.
Management assessments
Recognition of revenue from combined customer contracts
Annual report 2022
83
Consolidated operating revenues include both sales of hardware and IT-related services, often
derived from recognition of multiple elements in the same customer contract. Revenue is recognised
when control over the goods and services have been transferred to the customer.
Determining the transaction price for combined contracts
The Group determines the transaction price in respect of each performance obligations within its
contracts with customers when the stand-alone selling price for each performance obligation is not
readily available by assessing the stand-alone selling prices based on the Group’s customer
contracts for comparable products and services. This relates to contracts with customers where third-
party licenses are bundled with support and maintenance services. The income related to the third-
party license is determined based on the abovementioned stand-alone selling prices. The residual
income is allocated to support and maintenance. The revenue recognition is either at a point in time
or over time depending on the services rendered.
Variable considerations such as commissions, vendor discounts, rebates and other contractual bonus
elements may arise based on contracts with vendors and partners. Variable considerations requiring
management assessment are related to achieving certain thresholds in the agreement. In
determining the impact of variable considerations, the Group uses the most likely amount prescribed
in IFRS 15 whereby the transaction price is determined by reference to the single most likely amount in
a range of possible consideration amounts.
Note 4. Payroll
2022
2021
Salaries and holiday pay
200 928
213 848
Social security tax
44 652
45 535
Pension costs including social security tax
14 515
16 512
Other personnel costs
4 932
5 725
Total personnel costs
265 027
281 621
Number of employees at year end
315
341
All companies in the Group have defined contribution pension plans covering all employees.
Regarding remuneration to executive management, please refer to Note 28 Remuneration to
management.
Annual report 2022
84
Note 5. Other operational costs
2022
2021
Office rental and operations
6 525
6 143
Human resources
6 469
8 305
Sales and marketing
12 853
15 809
IT expenses
48 073
46 491
Fees for external services*
24 554
21 427
Factoring expenses
0
502
Communication
2 354
1 882
Travel expenses
4 224
1 916
Other costs*
4 573
6 074
Total operating costs
109 626
108 549
* 2021 figures are restated by a reclassification of NOK 3 million from Other costs to Fees for external
services.
Note 6. Other income and other expenses
Other income
2022
2021
Gain on sale of business
40 058
0
Other non-recurring income
0
22
Total
40 058
22
2022
On 3 January the divestment of the Voice and Contact centre business was completed for the total
consideration of NOK 65.5 million. The settlement was received in December 2021. The gain of NOK 40.1
million has been recognised in the income statement of the line item Other income in Q1 2022. NOK
24.5 million has been derecognised from the statement of financial position’s line item Assets held for
sale.
Other expenses
2022
2021
Acquisition related costs
(604)
(10 120)
Other non-recurring expenses
(9 411)
(7 088)
Total
(10 015)
(17 209)
2022
Acquisition-related costs are related to the acquisition of Crypho AS and the remaining 20% of the
shares in Techstep Finance AS. Other non-recurring expenses are related to restructuring.
2021
Acquisition-related costs are related to the acquisition of Famoc and other non-recurring expenses
are related to severance packages to former CEO and Managing director in Techstep Norway AS.
Annual report 2022
85
Note 7. Financial income and expenses
2022
2021
Interest income
979
1 368
Other financial income
4 622
10 864
Total financial income
5 601
12 232
Interest expenses interest bearing debt
(12 850)
(8 021)
Interest expenses leasing
(1 177)
(1 247)
Other financial expenses
(3 537)
(11 192)
Total financial expenses
(17 565)
(20 460)
x
Other financial income and expenses mainly comprise agio and disagio, respectively.
Note 8. Tax
Income tax expense
2022
2021
Current tax
(5 426)
(2 770)
Change in deferred tax
981
18 860
Tax expense
(4 445)
16 091
Reconciliation of relationship between accounting profit and tax expense
Profit before tax
(64 170)
(118 750)
Tax at the Norwegian tax rate of 22%
14 117
26 125
Tax effect permanent differences
(4 124)
(6 620)
Difference in tax rates
(1 019)
(467)
Deferred tax asset not recognised
(10 435)
-
Other
(2 984)
(2 947)
Income tax expense
(4 445)
16 091
Effective tax rate
-7%
40%
Amounts recognised directly in equity
Deferred tax: Share issue cost
(823)
(1 109)
Total
(823)
(1 109)
Tax losses
Unused tax losses for which no deferred tax asset has been recognised, see note 18*
(563 406)
(493 774)
Potential tax asset at 22% tax rate
(123 949)
(108 630)
Deferred tax
The balance comprises temporary differences attributable to:
Property, plant and equipment
158 320
111 638
Inventories
(951)
4 784
Trade receivables and other receivables
(721)
(320)
Leasing
(1 748)
(2 309)
Other current liabilities
4 282
(330)
Tax loss carried forward
(86 285)
(49 500)
Carry forward interest
(3 779)
(1 991)
for which no deferred tax asset has been recognised
-
-
Total basis for deferred tax
69 118
61 973
Annual report 2022
86
Tax rate deferred tax
22%
22%
Net deferred tax with applicable year's tax rate
15 206
13 634
Change in deferred tax due to change in tax rate
-
27
Difference in tax rates
(1 140)
(765)
Adjustment, prior years
-
(401)
Net deferred tax (+)/ deferred tax asset (-)
14 066
12 495
Net deferred tax related to Norway
(6 412)
(11 295)
Net deferred tax related to Sweden
15 827
17 784
Net deferred tax related to Polen
4 651
6 006
Total deferred tax (+)/ deferred tax asset (-)
14 066
12 495
Deferred tax asset
(6 470)
(2 149)
Deferred tax liability
20 536
14 645
Total deferred tax (+)/ deferred tax asset (-)
14 066
12 495
*Unused tax losses 2021 are adjusted according to final tax reporting 2021
Note 9. Leases
Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
Right-of-use assets
Buildings
Equipment
Vehicles
Total
As at 1 January 2022
25 990
1 329
2 948
30 267
Additions
10 940
611
950
12 500
Additions from business combinations
-
-
-
-
Depreciation
(10 665)
(944)
(2 154)
(13 763)
Variable lease payment adjustment
-
-
-
-
Translation differences
(757)
1 145
346
734
As at 31 December 2022
25 508
2 141
2 090
29 738
Buildings
Equipment
Vehicles
Total
As at 1 January 2021
35 624
1 812
2 796
40 232
Additions
4 963
-
2 444
7 407
Additions from business combinations
845
-
-
845
Depreciation
(10 849)
(483)
(2 111)
(13 443)
Variable lease payment adjustment
528
-
-
528
Translation differences
(5 121)
-
(181)
(5 302)
As at 31 December 2021
25 990
1 329
2 948
30 267
Annual report 2022
87
Lease liabilities
Buildings
Equipment
Vehicles
Total
As at 1 January 2022
28 412
1 423
3 001
32 835
Additions
10 911
576
986
12 473
Additions from business combinations
-
-
-
-
Interest expense
909
120
148
1 177
Lease payments
(12 081)
(1 049)
(2 293)
(15 423)
Variable lease payment adjustment
-
-
-
-
Translation differences
(695)
1 189
324
818
As at 31 December 2022
27 457
2 259
2 165
31 880
Buildings
Equipment
Vehicles
Total
As at 1 January 2021
35 775
1 853
2 922
40 550
Additions
4 963
-
2 444
7 407
Additions from business combinations
845
-
-
845
Interest expense
1 025
58
164
1 246
Lease payments
(13 357)
(488)
(2 395)
(16 240)
Variable lease payment adjustment
528
-
-
528
Translation differences
(1 367)
-
(134)
(1 501)
As at 31 December 2021
28 412
1 423
3 002
32 835
Lease liabilities
2022
2021
Non-current
16 738
22 204
Current
15 142
10 631
Total
31 880
32 835
Maturity analysis nominal payments of lease liabilities 2022
Up to 1 year
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Lease liabilities
15 496
12 258
5 886
0
Maturity analysis nominal payments of lease liabilities 2021
Up to 1 year
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Lease liabilities
13 652
11 841
10 467
0
Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
Annual report 2022
88
2022
2021
Depreciation charge
Buildings
10 665
10 849
Equipment
944
483
Vehicles
2 154
2 111
Licences
0
0
Total
13 763
13 443
Interest charge
1 177
1 247
Other charges*
3 006
5 282
*Other charges comprise office expenses such as electricity, cleaning, security, shared costs and
miscellaneous.
Description of the Group’s leasing activities
The Group leases offices, equipment and vehicles. Rental contracts are typically made for fixed
periods of 12 months to 5 years but may have extension options.
Incremental borrowing rate
To determine the incremental borrowing rate, the Group, where possible, uses recent third-party
financing received by the individual lessee as a starting point, adjusted to reflect changes in financing
conditions since third party financing was received using a build-up approach that starts with a risk-
free interest rate adjusted for credit risk for leases held by the Group, which does not have recent third-
party financing, and makes adjustments specific to the lease, e.g. term, country, currency and security.
Extension and termination options
Currently the Group has not included any extension or termination options in the liabilities. The options
are most widely used in rental of office buildings. All the Group’s contracts have from 1-4 years left of
the rental period. The Group assesses that premises with less than 2 years will be vacated at end of
lease. For premises with longer contracts it is assessed as uncertain whether the extension or
termination options will be utilised.
The majority of extension and termination options held are exercisable only by the Group and not by
the respective lessors.
Critical judgements in determining the lease term
In determining the lease term, management considers all facts and circumstances that create an
economic incentive to exercise an extension option, or not exercise a termination option. Extension
options (or periods after termination options) are only included in the lease term if the lease is
reasonably certain to be extended (or not terminated). The lease term is reassessed if an option is
actually exercised (or not exercised) or the Group becomes obliged to exercise (or not exercise) it. The
assessment of reasonable certainty is only revised if a significant event or a significant change in
circumstances occurs, which affects this assessment, and that is within the control of the lessee.
During the current financial year such an event has not occurred.
Annual report 2022
89
Other information
The Group companies have not received any rent concessions during the pandemic. The amendment
made to IFRS 16 regarding rent concessions is not applicable for the Group.
Note 10. Tangible assets
Right of
use
assets
Equipment*
Other
fixed
assets
Total
Accumulated cost as at 1 January 2022
63 881
292 234
31 090
387 205
Additions
12 500
126 507
5 943
144 950
Additions arising from business combinations
0
0
83
83
Disposals
(2 673)
(76 928)
(15 641)
(95 242)
Translation differences
(103)
(4 236)
(11)
(4 350)
Accumulated cost as at 31 December 2022
73 605
337 577
21 464
432 646
Accumulated cost as at 1 January 2021
69 045
279 256
35 058
383 359
Additions
7 407
140 212
1 179
148 798
Additions arising from business combinations
845
-
869
1 714
Disposals
(12 152)
(122 605)
(4 979)
(139 736)
Translation differences
(1 264)
(4 629)
(1 037)
(6 930)
Accumulated cost as at 31 December 2021
63 881
292 234
31 090
387 205
Accumulated depreciation as at 1 January 2022
(33 613)
(149 468)
(25 081)
(208 163)
Additions arising from business combinations
(0)
(0)
-
(0)
Current year depreciation
(13 763)
(92 840)
(2 620)
(109 222)
Disposals
2 673
64 004
14 082
80 759
Translation differences
837
1 429
(223)
2 043
Accumulated depreciation as at 31 December
2022
(43 866)
(176 874)
(13 842)
(234 583)
Accumulated depreciation as at 1 January 2021
(28 813)
(153 906)
(27 018)
(209 737)
Additions arising from business combinations
-
-
(766)
(766)
Depreciation
(13 443)
(92 167)
(2 619)
(108 229)
Disposals
5 386
95 875
4 982
106 242
Translation differences
3 256
731
341
4 327
Accumulated depreciation as at 31 December
2021
(33 613)
(149 468)
(25 081)
(208 163)
Book value of assets 31 December 2022
29 738
160 703
7 622
198 064
Book value of assets 31 December 2021
30 267
142 766
6 009
179 043
2-10
years
2 years
3-5 years
Estimated economic life
Depreciation method
linear
linear
linear
xx
*Equipment comprise mobile phones, tablets and other equipment where the Group is the lessor.
Annual report 2022
90
Note 11. Intangible assets
Goodwill
Customer
relationships
Other
intangible
assets
Total
Accumulated cost as at 1 January 2022
736 389
385 121
148 288
1 269 797
Additions
-
-
52 250
52 250
Additions arising from business combinations
12 367
-
3 566
15 933
Disposals
-
-
(125)
(125)
Translation differences
(10 588)
(2 805)
636
(12 757)
Accumulated cost as at 31 December 2022
738 168
382 316
204 614
1 325 099
Accumulated cost as at 1 January 2021
715 212
376 652
83 394
1 175 257
Additions
-
-
48 883
48 883
Additions arising from business combinations
64 052
18 735
22 087
104 874
Disposals
(1 571)
(1 571)
Translation differences
(18 821)
(8 902)
(4 504)
(32 227)
Reclassified as held for sale
(24 054)
(1 364)
-
(25 418)
Accumulated cost as at 31 December 2021
736 389
385 121
148 288
1 269 797
Accumulated amortisation and impairment as at 1 January
2022
(143 840)
(305 171)
(45 024)
(494 034)
Additions arising from business combinations
-
-
(0)
(0)
Current year amortisation
-
(22 964)
(35 528)
(58 492)
Disposals
-
-
62
62
Translation differences
6 755
1 391
2 600
10 747
Accumulated amortisation and impairment
(137 085)
(326 744)
(77 889)
(541 718)
Accumulated amortisation and impairment as
(143 840)
(276 577)
(21 577)
(441 993)
Additions arising from business combinations
-
-
(1 666)
(1 666)
Amortisation
(0)
(31 260)
(23 463)
(54 723)
Translation differences
0
2 666
1 681
4 348
Accumulated amortisation and impairment
as at 31 December 2021
(143 840)
(305 171)
(45 024)
(494 034)
Annual report 2022
91
Book value as at 31 December 2022
601 084
55 572
126 725
783 381
Book value as at 31 December 2021
592 549
79 950
103 264
775 763
Estimated economic lifetime in years
Indefinite
5 years
3-5 years
Depreciation method
none
linear
linear
For a description of movement in the categories Goodwill and Customer relationships, refer to Note
19 Impairment of intangible assets and Note 22 Changes in Group structure and Business
combinations.
Note 12. Inventories
Book value of inventories
2022
2021
Inventories
24 473
20 068
Less write-down of inventories
(1 042)
(678)
Total inventories
23 431
19 391
xx
Annual report 2022
92
Note 13. Trade receivables and other receivables
Trade receivables and other receivables shown at maturity as at 31 December 2022:
Days outstanding
Book
Value
not
over-
due
0-30
days over-
due
30-60 days
over-due
60-90 days
over-due
> 90 days
over-due
Trade receivables
215 566
202 105
9 434
2 239
1 558
228
Other current receivables
33 801
33 801
-
-
-
-
Less provision for bad debt
(1 792)
(747)
(185)
(274)
(358)
(228)
Total trade receivables and
other short-term receivables
247 575
235 159
9 249
1 965
1 200
-
Expected loss rate
-
0%
2%
12%
23%
100%
The company has reassessed its loss allowance for 2022 and aligned the expected loss rate with
historical and expected credit losses.
Trade receivables and other receivables shown at maturity as at 31 December 2021:
Days outstanding
Book
Value
not
over-
due
0-30
days over-
due
30-60 days
over-due
60-90 days
over-due
> 90 days
over-due
Trade receivables
232 106
138 315
79 860
9 757
2 897
1 278
Other current receivables
31 435
31 435
-
-
-
-
Less provision for bad debt
(1 877)
(401)
(399)
(288)
(232)
(557)
Total trade receivables and
other short-term receivables
261 664
169 349
79 461
9 469
2 665
721
Expected loss rate
-
0%
1%
3%
8%
75%
xx
Annual report 2022
93
Changes in the provision for bad debt during the year
2022
2021
Opening balance provision for bad debt as at 1 January
(1 877)
(3 416)
Net change in the provision during the year
85
1 539
Closing balance provision for bad debt as at 31 December
(1 792)
(1 877)
Other short-term receivables
2022
2021
Accrued revenues
9 655
9 230
Prepaid expenses
17 183
10 104
Other current receivables
6 964
12 101
Total
33 801
31 435
xx
2022
2021
Actual losses on receivables
182
1 809
xx
Note 14. Cash and cash equivalents
The Group’s cash and cash equivalents consists of
2022
2021
Cash and bank deposits
61 119
50 350
Total
61 119
50 350
Of which is restricted
5 196
6 196
The Group’s cash and cash equivalents consist in their entirety of short-term bank deposits.
The carrying amounts of the Group’s cash and cash equivalents by currency
2022
2021
NOK
27 547
27 734
SEK
22 885
12 350
Other
10 687
10 267
total
61 119
50 350
xx
The Group has a credit facility of NOK 75 million related to the cash pool.
Annual report 2022
94
Note 15. Borrowings
The Group's interest-bearing liabilities consist of:
2022
2021
Current
Non-
current
Current
Non-
current
Seller credits related to business combinations
27 789
0
27 574
31 986
Bank loan
27 771
90 665
25 055
65 416
Bank overdraft
27 762
0
21 919
0
Total interest-bearing debt
83 322
90 665
74 548
97 402
*Refer to note 14. Net bank overdraft facility comprises bank overdrafts in cash pool and bank
deposits in cash pool.
The table below sets out expected nominal payments on borrowings:
Due within
Total
1 year
1-5 years
over 5
years
Annual interst rate
Bank overdraft facilities*
27 762
27 762
0
0
1-month NIBOR + 2.25%
Bank acquisition loan
66 340
23 167
43 174
0
3-month NIBOR + 2.50%
Bank loan, other
62 249
10 828
39 203
12 218
3-month NIBOR + 2.50%
Seller credits related with
business combinations
27 789
27 789
0
0
Trade payables
205 797
205 797
0
0
Tax payable
3 315
3 315
0
0
Public duties
41 100
41 100
0
0
Other current liabilities
102 780
102 780
0
0
Total
537 132
442 538
82 377
12 218
*Refer to Note 14. for reconciliation of net cash position
The Group has several overdraft facilities.
The Norwegian overdraft facility has a credit limit of NOK 75 million. In addition to interest, a quarterly
commission is charged in the amount of NOK 0.1 million (NOK 0.1 million).
The Swedish overdraft facilities have a total credit limit of SEK 14 million. The annual interest rate is
4.95 %. The facilities were not utilised as at year-end 2022.
The Polish overdraft facility has a total credit limit of PLN 1.3 million. The facility was not utilised as at
year-end 2022.
The Group discontinued its factoring facility in 2021. The factoring facility was replaced by an
increased overdraft facility.
Pledges in relation to the loans to financial institutions
The Group's bank loans, overdraft facilities and factoring facility are secured borrowings.
Annual report 2022
95
Book value of assets pledged as collateral is as follows:
2022
2021
Trade receivables
215 566
232 106
Inventories
23 431
19 391
Property, plant and equipment
7 622
6 009
Total book value of assets pledged as collateral:
246 619
257 505
Covenants
The Group's bank loans are subject to the following material covenants:
Equity share shall equal minimum 30 %.
NIBD/EBITDA ratio shall be maximum 2.5.
Withdrawal on cash pool/inventory plus accounts receivables ratio shall be maximum 60%.
Reconciliation of interest-bearing debt
2022
2021
Balance as of 1 January
171 950
193 027
Cash flow from financing activities
Proceeds from borrowings
55 768
35 145
Payments of borrowings
(29 019)
(41 783)
Net cash flow from financing activities
26 749
(6 638)
Additions arising from business
combinations
2 344
1 384
Non-cash settlements
(25 215)
0
Effects from exchange rate fluctuations
(286)
(1 013)
Other
(1 556)
(14 810)
Balance as of 31 December
173 987
171 950
Annual report 2022
96
Note 16. Other non-current debt
Other non-current debt consists of the following:
note
2022
2021
Lease liabilities
9
16 738
22 204
Residual obligations
20 817
20 207
Deferred revenue
-
894
Total other non-current debt
37 555
43 305
xx
Residual obligations are related to contracts with customers where the contract contains a buyback
obligation. The buyback price is fixed at contract inception.
Note 17. Other current liabilities
Other current liabilities
note
2022
2021
Accrued personnel expenses (bonus, holiday pay etc.)
40 373
37 439
Accrued cost
19 650
16 975
Provision for onerous lease contracts
2 708
-
Deferred revenue
3
151 568
135 320
Prepaid revenue
19 133
15 343
Lease liabilities
9
15 142
10 631
Residual obligations
16 591
9 797
Other current financial and non-financial liabilities
22
4 325
69 600
Total other current liabilities
269 490
295 106
xx
Note 18. Critical estimates
The preparation of consolidated financial statements in conformity with IFRS requires the use of
certain critical accounting estimates. It also requires management to exercise its judgment in the
process of applying the Group’s accounting policies.
Changes in assumptions may have a significant impact on the consolidated financial statements in
the period the assumptions are changed. Estimates and judgments are continually evaluated and are
based on historical experience as adjusted for current market conditions and other factors.
Management believes the underlying assumptions are appropriate.
Management makes estimates and assumptions concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related actual results. The estimates, assumptions and
Annual report 2022
97
management judgments that have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year are outlined below.
Detailed information and judgement about each of these estimates is included in other notes together
with information about the basis of calculation for each affected line item in the financial statements.
Impairment of intangible assets
Goodwill and customer relationship are recognised based on the acquisition method used to account
for business combinations. Customer relationships acquired in previous periods were recognised at
fair value at the acquisition date, have a finite useful life and are subsequently carried at cost less
accumulated amortisation and impairment losses.
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and
are tested annually for impairment, or more frequently if events or changes in circumstances indicate
that they might be impaired.
The recognised values of goodwill and customer relationships are material to the 2022 financial
statements as a whole, and it is important that the user of the Group’s financial statements
understands the existence of an inherent uncertainty pertaining to the recognised values.
Impairment test related to goodwill and customer relationships is further described in Note 19.
Goodwill
The Group tests whether goodwill has suffered any impairment on an annual basis. For the 2022 and
2021 reporting period, the recoverable amount of the cash generating units (CGUs) was determined
based on value-in-use calculations. This calculation requires management to estimate the future
cash flows expected to arise from the CGUs and a suitable discount rate to calculate present value.
Estimated future cash flows are based on financial budgets and forecasts approved by management
covering a three-year period. Cash flows beyond the three-year period are extrapolated using the
estimated growth rates. Details of recognised goodwill are provided in Note 19, including discount rates
calculations and sensitivity disclosures.
Customer relationships
The Group estimates the useful life of the customer relationship to be at least 5 years based on the
expected future revenue generated from the customer base. However, the actual useful life may be
shorter or longer than 5 years, based on management assessments of technical innovations,
technical obsolescence of existing products and competitor actions.
Recognition of income tax
The Group is mainly subject to income taxes in three jurisdictions, and significant estimates are
required in determining the provision for income taxes and related tax balances. There are many
transactions and calculations for which the ultimate tax determination is uncertain. The Group
recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes
will be due. Where the final tax outcome of these matters is different from the amounts that were
initially recorded, such differences will impact the current tax and deferred tax provisions.
Annual report 2022
98
Deferred tax assets are recognized when it is probable the company will have a sufficient taxable profit
in subsequent periods to utilize the tax asset. Assessment of future ability to utilise tax positions is
based on judgements of the level of taxable profit, the expected timing of utilisation and expected
temporary differences.
The Group has at the balance sheet date tax losses carried forward which are not included in the basis
for the recognised deferred tax asset, as significant uncertainty pertaining to the possible utilisation
of these losses has been identified.
Annual report 2022
99
Note 19. Impairment of intangible assets
For impairment testing goodwill, customer relationships and technology acquired through business
combinations are allocated to the CGUs as shown in the table below.
Goodwill
Customer relationships
Technology
2022
2021
2022
2021
2022
2021
Norway
344 452
243 467
-
284
-
-
Crypho
4 952
-
-
-
-
-
Sweden
189 588
195 445
42 586
63 171
8 923
12 424
Mytos
-
93 570
-
343
-
-
Poland
62 091
60 067
12 986
16 152
11 802
14 680
Total
601 083
592 549
55 572
79 950
20 725
27 104
Cash generating units
Norway
: Comprises the companies Techstep Norway AS, Techstep Finance AS and Mytos AS. The cash
flows from Mytos have been more integrated with Techstep Norway AS and for the 2022 impairment
test Mytos was included in the Norway CGU. All initial input into Techstep Finance AS is created by
Techstep Norway AS, and Techstep Finance AS is therefore not considered to be a cash generating
unit by itself.
Goodwill allocated to Norway is mainly related to acquisition of Nordialog, Techstep Finance AS and
Mytos AS.
Crypho
: Crypho AS has an end-to-end encrypted enterprise software as a service (SaaS) messaging
and file-sharing application. The company was acquired in June 2022, and during the six months of
ownership in 2022 there has not been material changes in the valuation.
Sweden:
Comprise the companies Techstep AB, Techstep Finance AB and Optidev ApS. The
companies are followed up as Sweden, and are integrated with each other. Similar to Norway,
Techstep Finance AB is not considered to be a cash generating unit by itself.
Goodwill allocated to Sweden is mainly related to acquisition of Techstep AB, Optidev AB and
eConnectivity.
Poland:
Comprise the companies Famoc S.A. and Famoc ltd. Goodwill allocated to Poland is related
to the acquisition of Famoc.
Monitoring
Annual report 2022
100
Goodwill, Customer relationships and Technology are monitored by management at the level defined
in the table above. These CGU represent the lowest level within the Group at which the goodwill and
other intangible assets are monitored for internal management purposes.
Goodwill is initially recognised at the date of an acquisition of a business combination and represents
the excess of the consideration transferred, the amount of any non-controlling interest in the acquiree
and the fair value as at the acquisition date of any previous equity interest in the acquiree over the
fair value of the identifiable net assets acquired. Other intangible assets are recognised at the fair
value as at the acquisition date.
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and
are tested annually for impairment, or more frequently if events or changes in circumstances indicate
that they might be impaired. Impairment reviews are undertaken by calculating the recoverable
amount of the CGU containing goodwill and other intangible assets. The carrying amount of the CGU
is then compared to the recoverable amount of the CGU, which is the higher of value in use and the
fair value less costs of disposal. Any impairment is recognised immediately as an expense and is not
subsequently reversed.
The estimate of the recoverable amount of the CGU is largely based on management’s assumption
pertaining to the Group’s future cash flow projections.
For the 2022 and 2021 reporting period, the recoverable amount of the cash generating units (CGUs)
was determined based on value-in-use calculations which require the use of several key
assumptions. The calculations use cash flow projections based on financial budgets and prognoses
in the strategic plan approved by the Board of Directors covering a three-year period. Cash flows
beyond the three-year period are calculated using the estimated growth rates stated below.
Please refer to the table “Key assumptions for estimating future performance” for further details.
Annual report 2022
101
Key assumptions for estimating future performance
Norway
Sweden
Poland
Material
factors that
affect the
cash flow
from
operations
The cash generating unit
provides the customer with
the entire managed mobility
offering, consisting of
Hardware, third party
software within the mobility
space, consultancy,
maintenance and support,
and all of the Groups’ own
software, including
Fakturakontroll. All of the
products are offered stand-
alone or through bundles. The
CGU retains cash flows from
the traditional hardware
business, which is expected to
decrease over the next years.
All increase in cash flow is
primarily expected in own
software.
The Cash flows are based
upon expected future
performance using the 2023
budget as a baseline. Free
cash flows are expected to
increase in the years to come
as the organisation settles
and becomes more effective.
The cash generating unit
provides the market with a
comprehensive service stack
comparable to the Norwegian
counterpart. The company is
moving towards offering a full
suite of managed mobility,
including the Origo platform
adapted to the Swedish
market.
The cash flows are based
upon expected future
performance using the 2023
budget as a baseline. Free
cash flows are expected to
increase in the years to come
as the organisation settles
and becomes more effective.
The cash generating unit is
based in Poland and delivers
software solutions for mobility
management to SMEs and
enterprises throughout Europe.
The software has a good fit with
the Groups other offerings and
integration of the product into
the Nordic offerings is being
undertaken.
The CGU has stable free cash
flows.
.
The CGU operates in a stable
economy with a high
penetration of use of
advanced mobile devices.
The market related to other
service offerings from the
CGU is expected to grow in
the future.
Third party independent
agencies have reported an
expected compound average
growth rate in the markets
the CGU operates far above
The CGU operates in a stable
economy with a high
penetration of use of
advanced mobile devices.
The market related to other
service offerings from the
CGU is expected to grow in
the future.
Third party independent
agencies have reported an
expected compound average
growth rate in the markets
the CGU operates far above
The CGU operates from Poland,
however, it has customers in
many geographies where both
economic and market
conditions differ.
A strength is that the CGU is
diversified, however the risk
profiles of the individual
customers vary.
Annual report 2022
102
the growth estimates used in
the impairment assessment.
the growth estimates used in
the impairment assessment.
Capital expenditure is
assumed to be equal to
depreciation in the terminal
year.
Capital expenditure is
assumed to be equal to
depreciation in the terminal
year.
Capital expenditure is assumed
to be equal to depreciation in
the terminal year.
Main budget
and long
term
assumptions
The budget and long term
plan is based on the
continued transition from old
to new revenue streams. The
budget for 2023 is at the
same level as results
delivered in 2022, however
there is an underlying shift
from old to new revenue
streams. There is a risk that
there is a lag in the transition
and that the result delivered
will be lower. The budget is a
building block in the long-
term strategy plan, which has
an ambition of an increase in
free cash flow.
Refer to sensitivity analysis
below regarding reductions in
free cash flows and impact
on impairment.
The budget and long term
plan in Sweden is based on
the same underlying value
chains as in Norway, where
investments related to
processes and systems are
taken in 2022. The systems,
products and processes will
be rolled out in Sweden and
the group will scale better on
new systems.
Refer to sensitivity analysis
below regarding reductions in
free cash flows and impact
on impairment.
The budget and long-term plan
in the CGU is related to the
integration in the Group,
standardizing the product
offering into the smart
packaging, and growing sales
through direct and partner-
sales channels.
Refer to sensitivity analysis
below regarding reductions in
free cash flows and impact on
impairment.
The calculations of the CGU carrying amount use cash flow projections based on financial budgets
and forecasts approved by management covering a three-year period. Cash flow for year four and
five were calculated using estimated growth rates. In year six a terminal value is calculated.
Discount rates
The pre-tax discount rate applied for the impairment testing is set between 11.2% - 13.7% depending on
the geographic area. This rate of return is calculated based on the weighted average of required rates
Annual report 2022
103
of return on the Group’s equity and debt (WACC) using the capital asset pricing model (CAPM). The
post-tax rates are converted to pre-tax rates by using nominal tax rate in the relevant countries.
The required rate of return on debt is estimated based on a long-term risk-free interest rate, to which
a premium is added to reflect the creditors' risk when lending funds to the Group. The discount rate
includes a small business premium (operational risk) and the expected future levels of inflation. For
impairment reviews performed at year end 2022 and 2021, these assumptions have been applied
consistently across the Group."
2022
2021
Equity ratio
50%
42%
Growth in terminal value
2.0%
0.5 %
WACC
11.2% - 13.7%
11.9 %
Sensitivity
A sensitivity analysis would result in the following impairment indications. The sensitivities are applied
in all years throughout the forecasting period.
Impact on impairment
Norway
Sweden
Poland
10% decline in free cash flow
No impairment
No impairment
No impairment
1 % increase in WACC
No impairment
No impairment
No impairment
Note 20. Financial risk management
The Group's financial risk is related to credit risk, liquidity risk, currency risk and interest rate risk. The
Group's risk management aims to support value creation and ensure a solid financial platform,
through transparent and strategic management of both financial and operational risk factors.
Operational risk relates mainly to major projects, which are continuously reviewed by management.
The Group’s capital consists of net interest-bearing debt (NIBD) and equity:
2022
2021
Non-current interest-bearing borrowings
90 665
97 402
Current interest-bearing borrowings
83 322
74 548
Cash and cash equivalents*
61 119
50 350
NIBD
112 868
121 600
Group equity
571 520
555 586
Net gearing (NIBD/equity)
20%
22%
Undrawn credit facilities
64 238
72 081
Annual report 2022
104
xx
A) Capital management
The Group’s capital structure's primary focus is to ensure sufficient free liquidity in the form of cash
and cash equivalents along with bank overdraft facilities to ensure that the Group can continually
service its obligations and at the same time be able to make strategic acquisitions.
B) Credit risk
Credit risk is the risk that customers are unable to settle their obligations as they mature. Credit risk is
considered part of the business risk and is included in ongoing operations. The Group has established
procedures for credit rating major private customers, and the risk that customers do not have the
financial means to meet their obligations is considered low. Historically, only minor losses have been
realised as a result of customers experiencing financial difficulties.
The customer base comprises many medium-sized customers, along with a few larger customers.
The customer portfolio is considered to be well diversified across industries, as well as private and
public customers. The risk level is considered satisfactory. The bulk of the Group's customers are
Norwegian and Swedish, which constitutes a geographic concentration of risk.
No single customer represents 10% or more of trade receivables as at 31 December 2022 or as at 31
December 2021. No single customer represents 10% or more of the Group's revenues in 2022 or 2021.
The maximum credit exposure consists of the carrying value of receivables and cash and cash
equivalents. All receivables are due within one year. Normally, payment is 14 days after invoicing.
Provisions for losses on trade receivables are based on portfolio assessment of Trade receivables as
disclosed in note 13.
Historically, actual losses on trade receivables have been immaterial, as was also the case in 2022. It
is management’s assessment that the Group's overall credit risk is satisfactory. Please also refer to
Note 13, Trade receivables and other receivables.
C) Liquidity risk
Liquidity risk is the risk of not being able to pay the Group's financial obligations upon maturity. Liquidity
risk arises from a mismatch between cash flows from operations and financial commitments. Liquidity
budgets are prepared based on the Group's financial budgets. The budgets are prepared annually
and are updated with new forecasts throughout the year. Transforming from a transactional model to
a recurring revenue model, which by definition postpones incoming cash flows, puts a higher strain
on the liquidity position of the Group. The Group's liquidity is closely monitored by management and
Annual report 2022
105
the Board of Directors. If the need arises, the Group has access to multiple funding sources to balance
the transformation.
For details regarding the Group's interest-bearing borrowings refer to Note 15 Borrowings.
D) Currency risk
The material part of the Group's operations is conducted in the Nordics. The Group is thus not
materially affected by operational currency fluctuations other than fluctuations between NOK and SEK.
The bulk of the Group's goods and services is billed in NOK or SEK as appropriate. To a minor extent,
some solutions revenue and expenses are invoiced in PLN, EUR and USD. The Group does not hedge
cash flows in foreign currencies. The Group has low cash holdings, trade receivables and trade
payables in currencies other than NOK and SEK.
Therefore, the consequences on the Group's profit and equity from changes in exchange rates
between NOK and foreign currencies, and SEK and foreign currencies is limited and deemed
acceptable. There is limited trade between Norway and Sweden and currency risk is considered to be
low overall. Group values related to foreign operations are subject to currency fluctuations. As such,
there will be variations in the financial statement the line item Exchange differences on translating
foreign operations in the consolidated statement of comprehensive income.
E) Interest rate risk
Interest rate changes have an effect on consolidated operating income and cash flows from
operating activities. The Group's interest rate risk is related to floating interest rates on bank accounts
and deposits, in addition to floating rate debt in credit institutions. The Group has no fixed-rate
deposits or debt, and is therefore not exposed to fair value interest rate risk. The Group assesses its
capital structure on an ongoing basis.
Interest rate sensitivity
Increase/
decrease in
basis points
Increased
interest
rate effect
on profit
before tax
Decreased
interest
rate effect
on profit
before tax
Based on net interest-bearing items 31.12.2022
+/- 100
-1 230
1 230
Based on net interest-bearing items 31.12.2021
+/- 100
-1 276
1 276
Annual report 2022
106
F) Categories of financial instruments
This section explains the judgements and estimates made in determining the fair values of the
financial instruments that are recognised and measured at fair value in the financial statements. To
provide an indication of the reliability of the inputs used in determining fair value, the Group has
classified its financial instruments into the three levels prescribed under the accounting standards. An
explanation of each level is included in note 1 accounting principles.
The fair value of all financial assets and financial liabilities are assessed to, for all material purposes,
be equal to book value. To assess the fair value of shares and investments held by the Group
management assesses the underlying values in the companies where the Group holds shares. The
change in fair value is accounted for over profit and loss.
The Group has the following categories of financial
instruments as at 31 December 2022:
Financial
assets at fair
value through
profit or loss
Financial
assets at
amortised
cost
Total
Level in fair
value
hierarchy
ASSETS
Shares and investments
608
0
608
3
Other non-current assets
0
2 655
2 655
Accounts receivables
0
213 773
213 773
Other receivables
0
33 801
33 801
Cash and cash equivalents
0
61 119
61 119
Total assets
608
311 349
311 957
Financial
liabilities at
fair value
through profit
or loss
Financial
liabilities at
amortised
cost
Total
Level in fair
value
hierarchy
LIABILITIES
Non-current interest-bearing borrowings
0
90 665
90 665
Other non-current debt
0
37 555
37 555
Current interest-bearing borrowings
0
83 322
83 322
Accounts payables
0
205 797
205 797
Current lease liabilities
0
15 142
15 142
Other current financial liabilities
0
76 614
76 614
Total liabilities
0
553 510
553 510
The Group has the following categories of financial
instruments as at 31 December 2021:
Financial
assets at fair
value through
profit or loss
Financial
assets at
amortised
cost
Total
Level in fair
value
hierarchy
ASSETS
Shares and investments
590
0
590
3
Other non-current assets
0
1 224
1 224
Annual report 2022
107
Accounts receivables
0
230 229
230 229
Other receivables
0
31 435
31 435
Cash and cash equivalents
0
50 350
50 350
Total assets
590
313 238
313 828
Financial
liabilities at
fair value
through profit
or loss
Financial
liabilities at
amortised
cost
Total
Level in fair
value
hierarchy
LIABILITIES
Non-current interest-bearing debt
0
97 402
97 402
Other non-current debt
0
43 305
43 305
Current interest-bearing borrowings
0
74 548
74 548
Accounts payables
0
193 833
193 833
Current lease liabilities
0
10 631
10 631
Other current financial liabilities
0
62 215
62 215
Total liabilities
0
522 164
522 164
xx
Note 21. Legal disputes and contingencies
The Group has no ongoing legal disputes.
Note 22. Changes in Group structure and business combinations
2022
Acquisition of Crypho AS
On 1 June, Techstep acquired 100% of the share in Crypho AS. The company has an end-to end
encrypted enterprise software as a service (SaaS) messaging and file-sharing application. The
transaction was partly settled in 368 902 consideration shares in Techstep ASA. At the time of
completion, this corresponded to NOK 1.1 million. The earnout (refer to table below) is to be settled in
Techstep shares.
The table below summarises the consideration transferred and the amounts recognised for assets
acquired and liabilities assumed after the business combinations:
Consideration and amount recognised
Total
Cash payments
3 673
Consideration shares
1 059
Seller credit
1 818
Total
6 550
Annual report 2022
108
Consideration and amount recognised
Total
Consideration shares
1 059
Seller credit
1 818
Total
2 877
Net assets
Total
Intangible assets
3 566
Property plant and equipment
83
Trade and other receivables
28
Cash and cash equivalents
294
Other non-current liabilities
(5 831)
Current liabilities
(217)
Net assets
(2 076)
Excess value
4 953
Purchase price allocation
Total
Goodwill
4 953
Total
4 953
*Settlement of shareholder loans: Crypho had shareholder loans of NOK 3.7 million. In conjunction with
closing of the transaction, Techstep became the debtor. The shareholder loans were subsequently
settled with 1 129 118 shares in Techstep ASA.
Acquisition of last 20% of shares in Techstep Finance AS
On 14 February, the company acquired the remaining 20% of the shares in Techstep Finance AS for
NOK 9.0 million. The amount was settled in cash. Goddwill of NOK 7.4 million was recognized. Following
the transaction, Techstep owns 100% of the shares in Techstep Finance AS. Techstep Finance AB is a
100%-owned subsidiary of Techstep Finance AS and the ownership in Techstep Finance AB has
increased correspondingly.
Divestment of Voice and Contact centre business unit
On 3 January, the divestment of the Voice and Contact center business unit was completed for a total
consideration of NOK 65.5 million. The settlement was received in December 2021. The gain of NOK 40.1
million has been recognized in the income statement as Other income in 2022. NOK 24.5 million has
been derecognised from Assets held for sale.
2021
Divestment
Techstep divested its Voice & Contact Centre business units ("VCC") in Norway and Sweden for a total
combined consideration of NOK 65.7 million, settled in cash. The proceeds were received at the end of
2021, while the transaction closed 3 January 2022.
In the 2022 financial accounts, the proceeds of NOK 65.7 million are accounted for as other short term
debt (NOK 65.7 million) on the line item Other current liabilities in the statement of financial position.
The amount was used to reduce the Group’s bank overdraft. The bank overdraft is included in the line
Annual report 2022
109
item Current interest-bearing liabilities. In relation to the transition the Group has identified assets and
liabilities of the net amount NOK 24.5 million which are classified as held for sale in the statement of
financial position. Assets classified as held for sale are reclassified from Goodwill (NOK 24.1 million)
and net other assets (NOK 0.4 million).
In 2022 the Group recognised a gain from the divestment amounting to NOK 40.2 million in the
consolidated income statement. The remaining NOK 24.5 million was recognised towards the assets
held for sale.
Acquisition
Techstep acquired 100 % of the shares in Famoc S.A, Famoc Software Ltd. And Santa Rita Private
Venture 1 July 2021. The transaction was settled partly in 3 679 211 consideration shares in Techstep
ASA. At the time of completion, this corresponded to NOK 15.8 million.
The tables below summarise the consideration transferred and the amounts recognised for assets
acquired and liabilities assumed after the business combinations:
Consideration and amount recognised
Total
Cash payments
82 444
Consideration shares
15 821
Seller credit
11 976
Total
110 240
Net assets
Total
Intangible assets
3 271
Property plant and equipment
106
Right of use assets
845
Other non-current assets
628
Trade and other receivables
7 846
Cash and cash equivalents
8 473
Other non-current liabilities
(2 244)
Current liabilities
(1 779)
Net assets
17 146
Excess value
93 094
Purchase price allocation
Total
Technology
17 150
Customer relations
18 735
Deferred tax
(6 844)
Goodwill
0
Total
93 094
The goodwill of NOK 64.1 million relates to the know-how within the mobility space. The acquired
company broadens the Group's product offering. There are synergies with existing Group companies
by cross-selling of products. None of the goodwill recognised is expected to be deductible for income
tax purposes. The business combinations are carried out as part of the Group's growth strategy.
Annual report 2022
110
Note 23. Related party transactions
The following are considered related parties to the Group:
All the members of the Board of Directors and Group management, including close family members,
as defined by the Norwegian Accounting Act and associated regulations.
The following companies are considered as related parties to the Group during 2021 and 2022:
Company
Relationship
Role
Crayon Holding ASA and
subsidiaries
Jens Rugseth
Board member (Chairman of the Board until
February 2023)
Stobor Invest AB
Åke Fredrik
Logenius
Chief operation officer
Consolidated income statement
Revenue from
Expenses to
2022
2021
2022
2021
Crayon
2 060
678
3 536
2 534
Stobor Invest AB*
-
-
1 557
2 431
Receivables
Payables
Balance as at 31 December
2022
2021
2022
2021
Crayon
172
199
243
247
Stobor Invest AB*
-
-
27 789
43 777
xx
*Stobor Invest AB is 50% owned by COO Åke Fredrik Logenius. Payables to Stobor Invest AB are related
to settlement for Techstep's acquisition of Optidev AB in 2020.
On 6 May Techstep entered into an agreement to acquire the entire share capital of Crypho AS.
Following the transaction, Karbon Invest AS agreed to sell its 33.50% shareholding in Crypho AS and
subscribe for 123,579 new shares in Techstep ASA
at a price of NOK 3.25 per share (based on 90-day
VWAP)
.
Karbon Invest AS is indirectly controlled by Jens Rugseth.
All transactions with related parties are carried out at the arm’s length principle.
Annual report 2022
111
Note 24. Earnings per share
2022
2021
Weighted average number of shares outstanding
273 101 621
188 677 089
Weighted average number of shares outstanding (Diluted)
273 463 567
191 369 892
Profit attributable to owners of the parent
(68 926)
(103 050)
Earnings per share
(0.25)
(0.55)
Earnings per share (Diluted)
(0.25)
(0.55)
The Group has issued stock options to some members of the executive management Group and other
key employees, refer to note 28 Remuneration to the board and executive management for details.
For details regarding the issuance of shares in 2022 and 2021, refer to note 25 Shares, capital structure
and shareholders.
Note 25. Shares, capital structure and shareholders
Share capital
The company’s share capital as at 31 December 2022 was NOK 305,131,075 based on 305,131,075
ordinary shares with a par value of NOK 1.00.
Each share gives the right to one vote at the company’s general meeting. At the date of this report,
Techstep holds 1,914 treasury shares.
The development in share capital and other paid-in equity is set out in the consolidated statement of
changes in equity.
Development in the number of issued and outstanding shares:
Shares outstanding
Treasury shares*
Issued
Number of shares 1 January 2022
209 629 830
1 914
209 629 830
Employee share purchase programme
854 940
854 940
Private placement
92 631 820
92 631 820
Consideration shares
2 014 480
2 014 480
Number of shares 31 December 2022
305 131 070
1 914
305 131 070
Annual report 2022
112
Number of shares 1 January 2021
183 295 472
1 914
183 295 472
Employee share purchase programme
432 925
432 925
Private placement
22 222 222
22 222 222
Consideration shares
3 679 211
3 679 211
Number of shares 31 December 2021
209 629 830
1 914
209 629 830
*Treasury shares are included in the column Other equity in the statement of changes in equity.
2022
Techstep has issued consideration shares in relation to the following:
●
854 940 new shares related to employee share purchase programme
●
53 244 140 new shares in relation to private placement
●
2 014 480 new shares related to the Crypho acquisition
2021
Techstep issued consideration shares in relation to the following:
●
432 925 new shares related to employee share purchase programme
●
22 222 222 new shares in relation to private placement
●
3 679 211 new shares related to the Famoc acquisition
As at 30 December 2022, Techstep’s 20 largest shareholders were as follows:
Shareholder
Number of
shares
Ownership
DATUM AS
1
58 354 776
19.12%
KARBON INVEST AS
2
43 718 974
14.33%
Swedbank AB
33 478 881
10.97%
DNB Markets Aksjehandel/-analyse
14 770 000
4.84%
STEENCO AS
8 695 652
2.85%
AS CLIPPER
8 695 652
2.85%
VERDIPAPIRFONDET DNB SMB
6 851 311
2.25%
MIDDELBORG INVEST AS
6 341 228
2.08%
CIPRIANO AS
5 999 158
1.97%
Saxo Bank A/S
5 674 201
1.86%
Tigerstaden AS
4 795 000
1.57%
DNB BANK ASA
4 285 438
1.40%
CAMIKO AS
3 480 151
1.14%
TVENGE
3 000 000
0.98%
TIGERSTADEN MARINE AS
2 500 000
0.82%
SPECTER INVEST AS
2 490 000
0.82%
GIMLE INVEST AS
2 485 987
0.81%
Annual report 2022
113
NORDHOLMEN AS
2 462 551
0.81%
PIKA HOLDING AS
2 143 455
0.70%
Carnegie Investment Bank AB
2 072 173
0.68%
Total number owned by top 20
222 294 588
72.85 %
Total number of shares
305
131 075
100.00%
1)
Datum AS is controlled by deputy Board member Jan Haudemann-Andersen.
2)
Karbon Invest AS is owned by Board member Jens Rugseth
Duo Jag AS, which is partly owned by Board member Ingrid Leisner, owns 601 562 shares in Techstep
ASA.
Share option grant
At the Annual General meeting 22 June 2020, 4 269 883 share options (2.5% of existing shares) were
granted under the 2020 programme. The share options became exercisable (vested) on 22 June 2021
and must be exercised by 22 June 2024. The exercise price is NOK 3.00.
At the Annual General Meeting 22 April 2021, 4 593 307 share options (2.5% of existing shares) were
granted under the 2021 programme. The share options vest 1/3 each year from 22 April 2022 and are
fully vested on 22 April 2024. The options must be exercised by 22 April 2026. The exercise price is NOK
5.80.
The exercise price will be adjusted for any dividends paid or accrued before exercise. Each option
holder's aggregated gross profit from exercising the options shall be limited to the amount equal to 3
years’ gross base salary at the time of exercising the options. The exercise of share options can be
settled in cash, and/or with new or existing treasury shares.
CEO Børge Astrup was awarded 4 500 000 share options at an extraordinary general meeting held 22
September 2021. The options vest in three tranches with 1/3 per tranche, on 1 September 2024, 2025
and 2026. The exercise period is two years from the applicable vesting date. The strike price is NOK
4.75, NOK 5.75 and NOK 6.75 for the respective tranches. If the average, weighted Techstep share price
for seven calendar days exceeds NOK 30 per share, then the Company may require that all vested
options are exercised by Børge Astrup.
At the Annual General Meeting 21 April 2022, 3 170 648 share options (1.4% of existing shares) were
granted under the 2022 programme. The granted share options vest 1/3 each year from 21 April 2023
and are fully vested on 21 April 2025. The options must be exercised within 5 years. The exercise price
is NOK 3.245. The exercise price will be adjusted for any dividends paid or accrued before exercise. The
exercise of share options can be settled in cash, and/or with new or existing treasury shares.
As at 31 December 2022, the total number of outstanding share options was 10 075 764 (3.3%).
Annual report 2022
114
Overview of share options held by members of the management group as at 31 December 2022:
Name
Position
Shares
Share Options
Børge Astrup
CEO
1 455 362
4 500 000
Ellen Solum
CFO
0
0
Mads Vårdal
Chief Product Officer
5 019
1 497 374
Anita Huun
Chief Commercial Officer
125 324
838 518
Fredrik Logenius
Chief Operating Officer
23 817 225
570 306
Bartosz Leoszewski
Chief Technology Officer
397 952
340 647
David Landerborn
Chief Delivery & Advisory
Officer
294 162
229 659
Ellen Skaarnæs
Chief People Officer
54 209
340 647
Sheena Lim
Chief Marketing Officer
21 331
340 647
x
Note 26. Group structure
As at 31 December 2022 the Group consisted of the following companies:
Company
Location
Segment
Ownership
Techstep ASA
Oslo
Headquarters
100%
Techstep Norway AS
Oslo
Norway
100%
Mytos AS
Oslo
Norway
100%
Techstep Finance AS
Oslo
Norway
100%
Techstep AB
Karlstad/Borås
Sweden
100%
Techstep Finance AB
Karlstad
Sweden
100%
Techstep ApS
Denmark
Denmark
100%
Optidev ApS
Vejle
Denmark
100%
Techstep Polen S.A
Gdansk
Poland
100%
Techstep Ireland Ltd.
Cork
Poland
100%
Santa Rita Private Venture
Gdansk
Poland
100%
Annual report 2022
115
Note 27. Remuneration to auditor
Auditor remuneration
2022
Audit
services
Other
attestation
services
Tax
advisory
services
Other non-
audit
services
Total
BDO
2 704
62
-
123
2 889
Other
218
-
41
144
403
Total
2 922
62
41
267
3 292
2021
Audit
services
Other
attestation
services
Tax
advisory
services
Other non-
audit
services
Total
BDO
2 017
335
-
-
2 352
Other
554
-
-
-
554
Total
2 571
335
-
-
2 906
Xx
Note 28. Remuneration to the board and executive management
Total remuneration to the Executive Management Team
Name of director
Position
year
Fixed
Variabl
e
Option
progra
mme
Pension
expense
Total
remuner
ation
Proportion
of fixed and
variable
remunerati
on
Base
Salary
Fees
Fringe
benefit
s
One-
year
variabl
e
Børge Astrup
Chief Executive
Officer
2022
3 105
-
15
-
2 355
117
0.6/0.4
2021
1 250
-
6
417
787
47
0.5/0.5
Jens Haviken
1
2022
-
1 300
-
-
-
-
1/0
Annual report 2022
116
Chief Executive
Officer
2021
2 697
1 221
11
-
382
114
0.9/0.1
Anita Huun
2
Chief Financial
Officer
2022
1 890
-
14
-
240
112
0.9/0.1
2021
-
-
-
-
-
-
-
Marius Drefvelin
3
Chief Financial
Officer
2022
776
-
8
-
-
29
1/0
2021
2 344
-
57
350
305
111
0.8/0.2
Mads Vårdal
Chief Product
Officer
2022
1 677
-
15
-
548
116
0.8/0.2
2021
1 683
-
14
269
685
110
0.7/0.3
Erik Haugen
4
Chief
Transformation
Officer
2022
932
-
9
-
-
89
1/0
2021
1 389
-
14
265
685
112
0.6/0.4
Fredrik Logenius
Chief Operating
Officer
2022
912
-
103
-
272
269
0.8/0.2
2021
965
-
80
191
183
269
0.8/0.2
Bartosz
Leoszewski
5
Chief Technology
Officer
2022
1 145
-
2
-
98
13
0.9/0.1
2021
480
-
-
127
-
-
0.8/0.2
Ellen Skarnæs
Chief People Officer
2022
1 087
-
15
-
98
100
0.9/0.1
2021
1 062
-
16
117
-
81
0.9/0.1
Gunnar Aasen
6
Chief Revenue
Officer
2022
1 650
-
15
-
-
119
1/0
2021
494
-
4
78
-
39
0.9/0.1
Sheena Lim
7
Chief Marketing
Officer
2022
1 167
-
12
-
98
103
0.9/0.1
2021
-
-
-
-
-
-
-
David Landerborn
8
Chief Delivery &
Advisory
2022
914
-
75
-
175
155
0.9/0.1
2021
962
-
81
-
182
151
0.9/0.1
1. Mr Haviken resigned as CEO 1 July 2021. He received parts of his severance payment in 2022, which is presented
under the column “Fees”
2. Ms Huun was appointed CFO 7 February 2022. On 1 February 2023, she took on the role as Chief Commercial
Officer, however, Ms Huun will leave Techstep 31 August 2023
3. Mr Drefvelin resigned as CFO 28 February 2022
5. Mr Haugen was appointed Chief Transformation Officer in Q4 2021. Prior to the appointment he served as Chief
Commercial Officer. Mr Haugen resigned as Chief Transformation Officer 31 August 2022
6. Mr Aasen will leave Techstep 31 March 2023
7. Ms Lim was appointed Chief Marketing Officer 1 March 2022.
8. Mr Landerborn was appointed Chief Delivery & Advisory Officer 1 December 2022. Prior to the appointment he
served as Operations Manager
Total remuneration to the Board of Directors
Annual report 2022
117
Name
Position
2022
2021
Jens Rugseth
1
Chairman
500
500
Michael Jacobs
2
Member
167
-
Harald Arnet
Member
250
83
Ingrid Leisner
Member, Chairman Of the audit committee
320
300
Anders Brandt
Member
77
250
Melissa Mullholland
Member, Member of the audit committee
300
207
Einar J Greve
Deputy Chairman
-
125
Toril Nag
Member, Member of the audit committee
-
78
Total Remuneration
1 614
1 543
1. Mr. Rugseth resigned as Chairman of the Board in January 2023
2. Mr. Jacobs as appointed Chairman of the Board in January 2023
For detailed information on remuneration to executive management and the Board of Directors, see
the separate remuneration report for 2022 published on the company’s website
(
). The company has established guidelines for remuneration to executive
management which were approved by the company’s general meeting on 21 April 2022.
Annual report 2022
118
Note 29. Events after the reporting period
On 1 February 2023, Techstep strengthened its executive management team by appointing Ellen Solum
as new CFO and Anita Huun taking on a new role as Chief Commercial Officer. Together they will help
Techstep further sharpen its focus on both commercial growth, cost efficiencies and profitability.
On 15 February, the extraordinary general meeting approved changes to the Board. Jens Rugseth
stepped down as Chairperson and will continue as an ordinary Board member. Board member
Michael Jacobs was elected as new Chairperson of the Board
There are no other subsequent events to report after the reporting period.
Annual report 2022
119
Techstep ASA - Income statement
(Amounts in NOK 1 000)
Notes
2022
2021
Other revenue
67 555
37 148
Total revenue
67 555
37 148
Salaries and personnel costs
2
(60 936)
(24 549)
Other operational costs
2, 3
(46 277)
(87 220)
Depreciation
7
(4 387)
(6)
Amortisation
8
(4 107)
-
Other income
10
246
-
Other expenses
10
(2 292)
(9 716)
Operating profit (loss)
(50 197)
(84 344)
Financial income
4
16 765
76 543
Financial expense
4
(14 552)
(15 536)
Profit before tax
(47 983)
(23 337)
Income tax
5
-
1 884
Net income
(47 983)
(21 453)
Statement of comprehensive income
(Amounts in NOK 1 000)
2022
2021
Net income
(47 983)
(21 453)
Other comprehensive income
-
-
Total comprehensive income for the period
(47 983)
(21 453)
Annual report 2022
120
Statement of financial position
(Amounts in NOK 1 000)
ASSETS
Note
31.12.2022
31.12.2021
Non-current assets
Deferred tax asset
5
3 111
3 111
Technology
8
20 220
7 803
Total intangible assets
23 332
10 914
Right of use assets
7
8 660
-
Total tangible assets
8 660
-
Shares and investments
6
761 336
749 459
Non-current receivables from Group companies
9
91 013
103 189
Total financial assets
852 349
852 648
Total non-current assets
884 340
863 563
Current receivables from Group companies
9
121 769
131 181
Other receivables
8 614
4 424
Total inventories and receivables
130 020
135 604
Cash and cash equivalents
12
1 774
808
Total current assets
131 794
134 915
Total assets
1 016 134
998 478
EQUITY AND LIABILITIES
31.12.2022
31.12.2021
Share capital
305 131
209 630
Other equity
383 747
443 861
Total equity
688 878
653 491
Non-current interest-bearing borrowings
11
88 271
90 264
Other non-current debt
7
4 954
-
Total non-current liabilities
93 225
90 264
Current interest-bearing liabilities
11
79 233
68 491
Trade payables
43 085
44 656
Current liabilities to Group companies
9
100 434
133 107
Other current liabilities
7
11 642
9 964
Total current liabilities
234 393
254 722
Total liabilities
327 619
344 987
Total equity and liabilities
1 016 497
998 478
Annual report 2022
121
Oslo, 27 April 2023, signatures from the Board of Directors and the CEO of Techstep ASA:
Michael Grant Jacobs
Chairman
Harald Arnet
Board member
Ingrid Leisner
Board member
Jens Rugseth
Board member
Melissa Ann Mulholland
Board member
Børge Astrup
CEO
Annual report 2022
122
Statement of changes in equity
(Amounts in NOK 1 000)
Share
capital
Other paid-
in capital
Other equity
Total equity
Equity as at 1 January 2021
183 295
618 249
(244 286)
557 258
Profit for the period
(21 453)
(21 453)
Total comprehensive income for the
period
-
-
(21 453)
(21 453)
Transactions with owners in their capacity as owners:
Contributions of equity net of
transaction costs
Issue of ordinary shares as
consideration for a business
combination, net of transaction costs
and tax
3 679
12 141
15 821
Proceeds from issuance of shares net
of
transaction costs
22 655
75 264
Share-based payments
3 946
3 946
Equity as at 31 December 2021
209 630
705 655
(261 794)
653 491
Equity as at 1 January 2022
209 630
705 655
(261 794)
653 491
Profit for the period
(47 983)
(47 983)
Total comprehensive income for the
period
-
-
(47 983)
(47 983)
Transactions with owners in their capacity as owners:
Issue of ordinary shares as
consideration for a business
combination, net of transaction costs
and tax
2 014
3 442
5 456
Proceeds from issuance of shares net
of
transaction costs
93 487
8 698
102 185
Change in group contribution
previous years
(28 362)
(28 362)
Annual report 2022
123
Share-based payments
4 091
4 091
Equity as at 31 December 2022
305 131
717 794
(334 048)
688 878
Annual report 2022
124
Statement of cash flow
(Amounts in NOK 1 000)
Note
2022
2021
Profit before tax
(47 983)
(24 001)
Depreciation and amortisation
7, 8
8 494
6
Share-based payments
4 091
3 946
Changes in net operating working capital
(63 453)
26 682
Net cash flow from operational activities
(98 851)
6 632
Payment for acquisition of subsidiaries
-
(87 233)
Payment for intangible assets
8
(16 525)
(7 803)
Repayment of loans from subsidiaries
15 234
17 069
Group contribution received
15 988
6 371
Interest received
1 685
1 774
Net cash used on investment activities
16 382
(69 822)
Changes in ownership in Subsidiary
(9 000)
-
Proceeds from issuance of shares
76 969
101 853
Proceeds from borrowings
55 768
34 064
Repayment of borrowings
(24 747)
(64 410)
Lease repayments
(5 349)
-
Interest paid
(10 206)
(7 945)
Net cash flow from financing activities
83 435
63 563
Net change in cash and cash equivalents
965
373
Cash and cash equivalents at 1 January
808
435
Effects of exchange rate changes on cash and cash
equivalents
-
-
Cash and cash equivalents as of 31 December*
11
1 774
808
of which is restricted
624
784
Annual report 2022
125
Techstep ASA – Notes to the annual
accounts
1. General information, basis for preparation
2. Salaries and personnel cost
3. Other operational costs
4. Finance income and expenses
5. Income tax
6. Shares in subsidiaries and joint ventures
7. Leases
8. Intangible assets
9. Receivables and liabilities to Group companies
10. Other income and other expenses
11. Borrowings
12. Cash and cash equivalents
13. Events after the reporting period
Annual report 2022
126
Note 1. General information, basis for preparation
Techstep ASA is a public limited company incorporated and domiciled in Norway. The address of its
registered office is Brynsalléen 4, 0667 Oslo, Norway. The shares of Techstep ASA are listed on the Oslo
Stock Exchange under ticker TECH.
Techstep ASA is the parent company of the Techstep Group, with business in Norway, Sweden and
Denmark. For more information see the consolidated financial statements.
The financial statements were approved by the Board of Directors on 27 April 2023 and will be
proposed to the General Meeting 23 May 2023.
The financial statements for the company Techstep ASA have been prepared and presented in
accordance with simplified IFRS pursuant to § 3-9 in the Norwegian Accounting Act.
For the accounting principles used to prepare and present the financial statements refer to note 1
General information and summary of significant accounting policies in the Group financial statement.
Accounting principles applicable to the company not presented in the Group financial statements:
Shares in subsidiaries and joint ventures
Subsidiaries are all entities controlled, either directly or indirectly, by Techstep ASA. Techstep ASA
controls an entity when it is exposed to, or has rights to, variable returns from the involvement with the
entity and has the ability to affect those returns through power over the entity. Power over an entity
exists when Techstep has power to direct the activities in which significantly affect the entity's returns.
Generally, there is a presumption that a majority of voting rights results in control. Techstep considers
all relevant facts and circumstances in assessing whether control exist, including contractual
arrangements and other potential voting rights to the extent that these are substantive.
Shares are classified as investment in subsidiaries from the date Techstep ASA effectively obtains
control of the subsidiary (acquisition date).
A joint venture is an entity over which Techstep ASA directly, or indirectly through subsidiaries, has joint
control. Joint control is normally presumed to exist when Techstep controls 50% of the voting power of
the investee.
Shares are measured at cost, and impairment loss is recognised if the carrying amount exceeds the
recoverable amount. The impairment is reversed if the basis for the write-down is no longer present.
Group contributions received are included in financial income provided that they do not represent a
repayment of capital invested. Group contributions that represent a repayment of capital are
accounted for as a reduction in the cost of investments. Net Group contributions payable (gross Group
contributions less tax effect) are accounted for as cost of investments in subsidiaries.
Dividends from subsidiaries and associates are included in financial income.
Annual report 2022
127
Note 2. Salaries and personnel cost
2022
2021
Salary and holiday pay
19 474
21 639
Social security tax
2 382
1 218
Pension costs including social security tax
787
538
Other personnel costs
38 293
1 154
Total salaries and personnel cost
60 936
24 549
Number of employees at year end
5
5
In 2022 other personnel costs includes personnel expenses from other Group companies. In 2021
those expenses were incurred in Techstep Nordic AS and invoiced to Techstep ASA as management
fee (see note 3).
The Company's pension plans meet the requirements of the Act on Mandatory occupational
pensions (OTP).
Please refer to note 28 Remuneration to management in the consolidated Group financial
statements for details regarding executive management remuneration and note 25 Share, capital
structure and shareholders in the consolidated Group financial statements for information about
share option grant.
Auditor remuneration
2022
Audit
Services
Other
attestation
services
Tax
Advisory
Services
Other non-
audit
services
Total
BDO
1 174
62
0
0
1 236
Totalt
1 174
62
0
0
1 236
2021
Audit
Services
Other
attestation
services
Tax
Advisory
Services
Other non-
audit
services
Total
BDO
892
0
0
0
924
Totalt
892
0
0
0
924
Annual report 2022
128
Note 3. Other operational costs
2022
2021
Office rental and operations
2 331
137
Human resources
1 944
2 578
Sales and marketing
13 056
1 585
Computers and software
16 249
1 859
Fees for external services
10 614
13 848
Communication
44
48
Travel expense
397
136
Other costs
1 643
1 225
Management fee
0
65 804
Total operating costs
46 277
87 218
In 2022 expenses related to sales and marketing and computer and software were incurred in
Techstep ASA, while in 2021 those expenses were incurred in Techstep Nordic AS (merged into
Techstep Norway AS in December 2021) and invoiced to Techstep ASA as management fee.
Note 4. Finance income and expenses
2022
2021
Gain on sale of equity instruments
661
25 065
Interest income
4 534
3 800
Group contributions received
8 076
36 606
Other financial income
3 434
11 071
Total financial income
16 765
76 543
Interest expenses
11 806
8 235
Other financial expenses
2 746
7 301
Total financial expenses
14 552
15 536
Gain on sale of equity instruments in 2021 refers to a Group internal sale of the shares in Techstep Holding AB to
Optidev AB.
Annual report 2022
129
Note 5. Income tax
2022
2021
Change in deferred tax
-
(1 884)
Tax expense
-
(1 884)
Reconciliation of relationship between accounting profit and tax expense
Profit before tax
(47 983)
(23 337)
Tax at the Norwegian tax rate of 22 %
10 556
(5 134)
Tax effect permanent differences
(307)
3 250
Deferred tax asset not recognised
(10 249)
-
Income tax expense
-
(1 884)
Amounts recognised directly in equity
Deferred tax arising in the reporting period directly debited to equity:
Deferred tax: Share issue cost
(823)
(1 109)
Total
(823)
(1 109)
Tax losses
22%
22%
Unused tax losses for which no deferred tax asset has been recognised*
(540 360)
(493 774)
Potential tax asset at 22 % tax rate
(118 879)
(108 630)
Deferred tax
The balance comprises temporary differences attributable to:
Property, plant and equipment
(506)
(636)
Accounting accruals
(3 680)
(196)
Tax loss carried forward
(8 397)
(13 311)
Total basis for deferred tax
(14 143)
(14 143)
Tax rate deferred tax
22%
22%
Net deferred tax with applicable year's tax rate
(3 111)
(3 111)
Net deferred tax (+)/ deferred tax asset (-)
(3 111)
(3 111)
*Unused tax losses 2021 are adjusted according to final tax reporting 2021.
Annual report 2022
130
Note 6. Shares in subsidiaries and joint ventures
Shares in subsidiaries 2022
Location
Ownership/
voting
rights
Book value
Equity
31.12.2022
Net income
2022
Techstep Norway AS
Oslo
100%
244 078
127 646
16 325
Mytos AS
Oslo
100%
121 530
8 109
(727)
Techstep Finance AS
Oslo
100%
39 916
4 783
2 528
Crypho AS*
Oslo
100%
2 877
(2 923)
(848)
Techstep APS
Denmark
100%
65
(615)
(355)
Techstep AB**
Borås/Karlstad
100%
243 455
(21 430)
(38 287)
Techstep Polen S.A***
Gdansk
75%
109 415
14 830
1 307
Techstep Ireland Ltd***
Cork
75%
-
1 777
773
Santa Rita Private Venture***
Gdansk
100%
-
1 983
(25)
Total
761 336
134 160
(19 308)
* Reported net income relates to the ownership period from 1 June 2022 - 31 December 2022.
** Optidev AB changed its legal name to Techstep AB. During 2022 Techstep Sweden AB, Mytos AB and Techstep
Holding AB were merged into Techstep AB.
*** Santa Rita Private Venture owns the remaining 25% of Famoc S.A and Famoc Software Ltd. Famoc S.A. changed
its legal name to Techstep Polen and Famoc Software Ltd changed its legal name to Techstep Ireland.
In 2022 equity and net income are presented according to local GAAP, while 2021 figures also
includes IFRS adjustments for all subsidiaries.
Shares in subsidiaries 2021
Location
Ownership/
voting
rights
Book value
Equity
31.12.2021
Net income
2021
Techstep Norway AS
Oslo
100%
244 078
72 946
(595)
Mytos AS
Oslo
100%
121 530
9 983
(5 069)
Techstep Finance AS
Oslo
80%
30 916
10 608
4 380
Techstep APS
Denmark
100%
65
(393)
(259)
Optidev AB
Borås/Karlstad
100%
243 455
26 529
6 904
Famoc S.A*
Gdansk
75%
109 415
12 857
1 298
Famoc Software Ltd*
Cork
75%
-
924
(139)
Santa Rita Private Venture*
Gdansk
100%
-
1 939
57
Total
749 459
135 392
6 576
*
2021 figures of equity and net income are restated to exclude purchase price allocation eliminations
wrongly included last year.
Annual report 2022
131
Note 7. Leases
A rental contract together with relevant equipment was transferred to Techstep ASA from another
Group entity during 2022. For more information about leases refer to Note 9 to Group accounts.
Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
Right-of-use assets
Buildings
Equipment
Total
As at 1 January 2022
-
-
-
Additions
11 709
1 336
13 045
Depreciation
(3 903)
(483)
(4 387)
As at 31 December 2022
7 806
853
8 660
Lease liabilities
Buildings
Equipment
Total
As at 1 January 2022
-
-
-
Additions
13 727
1 390
15 117
Interest expense
409
42
451
Lease payments
(4 820)
(528)
(5 348)
As at 31 December 2022
9 316
904
10 219
Lease liabilities
2022
2021
Non-current
4 954
0
Current
5 265
0
Total
10 219
0
Maturity analysis nominal payments of lease liabilities 2022
Up to 1 year
Between 1
and 2 years
Between 2
and 5 years
Over 5 years
Lease liabilities
5 671
5 537
0
0
Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
Annual report 2022
132
2022
2021
Depreciation charge
Buildings
3 903
0
Equipment
483
0
Total
4 386
0
Interest charge
451
0
Other charges*
249
0
*Other charges comprise office expenses such as electricity, cleaning, security, shared costs and
miscellaneous.
Annual report 2022
133
Note 8. Intangible assets
Technology
Total
Accumulated cost as at 1 January 2022
7 803
7 803
Additions
16 525
16 525
Accumulated cost as at 31 December 2022
24 328
24 328
Accumulated cost as at 1 January 2021
-
-
Additions
7 803
7 803
Accumulated cost as at 31 December 2021
7 803
7 803
Accumulated amortisation and impairment as at 1 January
2022
-
-
Current year amortisation
(4 107)
(4 107)
Accumulated amortisation and impairment
(4 107)
(4 107)
Accumulated amortisation and impairment as
-
-
Amortisation
-
-
Accumulated amortisation and impairment
as at 31 December 2021
-
-
Book value as at 31 December 2022
20 220
20 220
Book value as at 31 December 2021
7 803
7 803
Estimated economic lifetime in years
3-5 years
Depreciation method
linear
Annual report 2022
134
Note 9. Receivables and liabilities to Group companies
2022
2021
Non-current receivables
91 013
103 189
Non-current receivables from Group companies
91 013
103 189
2022
2021
Group contribution received
16 320
36 606
Other current receivables
89 091
94 574
Trade receivables
16 358
0
Current receivables from Group companies
121 769
131 181
2022
2021
Other current liabilities
100 434
133 107
Current liabilities to Group companies
100 434
133 107
Non-current receivables are related to investments in the Swedish operations. The receivable is
interest bearing and considered a part of the Group’s net investment in Sweden.
Note 10. Other income and other expenses
2022
2021
Derecognition of contingent consideration
246
-
Total
246
-
In relation to the acquisition of Crypho AS, a contingent consideration was recognised. The
contingent consideration was partially reversed in 2022.
2022
2021
Acquisition related costs
(604)
(9 716)
Other non-recurring expenses
(1 688)
-
Total
(2 292)
(9 716)
Acquisition related expenses in 2022 are related to the acquisition of Crypho AS and the remaining
20% of the shares in Techstep Finance AS. In 2021 the acquisition-related expenses are related to the
acquisition of Famoc. Other non-recurring expenses in 2022 are related to restructuring.
Annual report 2022
135
Note 11. Borrowings
2022
2021
Current
Non-
current
Current
Non-
current
Seller credits related to business combinations
27 789
0
26 348
29 562
Bank loan
23 682
88 271
20 225
60 702
Bank overdraft
27 762
0
21 919
0
Total interest-bearing debt
79 233
88 271
68 491
90 264
The company had a bank loan of NOK 112 million as at 31 December 2022 (81 million as at 31 December
2021).
The company entered as the head of a cash pool for the Group companies in 2020. The cash pool
includes a credit facility presented net with cash deposits as current interest-bearing liabilities. Refer
to note 15 in the Group financial statement for details.
The company acquired Famoc S.A, Famoc Software Ltd and Santa Rita Private Venture in 2021. The
transaction was partly financed by borrowings. Refer to Note 15 in the Group financial statements
regarding borrowings and note 22 in the Group financial statements regarding the acquisition of
Famoc S.A, Famoc Software Ltd and Santa Rita Private Venture.
Annual report 2022
136
Note 12. Cash and cash equivalents
The Company's cash and cash equivalents consists of:
2022
2021
Cash and bank deposits
1 774
808
Total
1 774
808
Of which is restricted
624
784
Note 13. Events after the reporting period
Please refer to note 29 Events after the reporting period in the consolidated Group financial
statements.
Annual report 2022
137
Alternative performance measures
Techstep Group’s financial information is prepared in accordance with International Financial
Reporting Standards (IFRS). In addition, it is management’s intention to provide alternative
performance measures that are regularly reviewed by management to enhance the understanding
of Techstep’s performance, but not instead of the financial statements prepared in accordance with
IFRS. The alternative performance measures presented may be determined or calculated differently
by other companies. The principles for measuring the alternative performance measures are in
accordance with the principles used both for segment reporting in Note 2 and internal reporting to
Group Executive Management (chief operating decision makers) and are consistent with financial
information used for assessing performance and allocating resources.
Gross profit
Gross profit is defined as Total revenue less Cost of goods sold.
Net gross profit
Net gross profit is defined as Total revenue less Cost of goods sold and depreciation from Hardware-
as-a-Service.
Gross margin
Gross margin is defined as Total revenue less Cost of goods sold divided by Total revenue.
EBITDA
Earnings before interest, tax, depreciation, amortisation and impairment (EBITDA) is a key financial
parameter for Techstep. This measure is useful to users of Techstep's financial information in
evaluating operating profitability on a more variable cost basis as it excludes depreciation and
amortisation expense related primarily to leases, capital expenditures and acquisitions that occurred
in the past. The EBITDA margin presented is defined as EBITDA divided by total revenues.
Adjusted EBITDA
Adjusted Earnings before interest, tax, depreciation, amortisation and impairment (EBITDA) is based
on EBITDA but adjusted for transactions of a non-recurring nature. Such non-recurring transactions
include, but are not limited to restructuring costs, gains or losses related to sale of subsidiaries,
acquisition-related costs and other nonrecurring income and expenses.
EBITA
Earnings before interest, tax and amortisation (EBITA) is a key financial parameter for Techstep. This
measure is useful to users of Techstep's financial information in evaluating operating profitability on
a more variable cost basis as it excludes depreciation related primarily to leases and capital
expenditures and acquisitions that occurred in the past. The EBITA margin presented is defined as
EBITA divided by total revenue.
EBITA adjusted
Annual report 2022
138
Adjusted earnings before interest, tax, amortisation and impairment (EBITA) is based on EBITA but
adjusted for transactions of a non-recurring nature. Such non-recurring transactions include, but are
not limited to restructuring costs, gains or losses related to sale of subsidiaries, acquisition-related
costs and other non-recurring income and expenses.
EBIT
Earnings before interest and tax (EBIT) is useful to users with regard to Techstep's financial information
in evaluating operating profitability on the cost basis as well as the historic cost related to past
business combinations and capex. The EBIT margin presented is defined as EBIT divided by total
revenue.
Total net operating expenses
Total net operating expenses includes the line items Cost of goods sold, Salaries and personnel costs,
Other operating costs, Share of profit (loss) in joint venture, Depreciation, Amortisation, Impairment
and Other income.
Hardware revenue
Hardware revenue is defined as revenue from sales of tangible goods and related discounts from
suppliers and partners.
Hardware share of revenue is the hardware revenue divided by total revenues.
Solutions revenue
Solutions revenue is defined as revenue from sales of licenses, support and other non-tangible items
to customers. Also included are discounts from suppliers and partners. Solutions share of revenue is
the solutions revenue divided by total revenue.
Net interest-bearing debt (NIBD)
Net interest-bearing debt is non-current interest-bearing debt plus current interest-bearing liabilities
less cash and cash equivalents.
Equity ratio
Equity ratio is defined as Total equity divided by total equity and liabilities.
Capital Expenditure (Capex)
Capital expenditure is the same as payment for property, plant and equipment and intangible
assets.
Annual on own software
ARR is calculated as the revenue the following 12 months from own software as at the balance sheet
date. The ARR is calculated by multiplying the number of users of own software with the price per
product and in turn annualized.
Recurring revenue
Annual report 2022
139
The recurring revenue portfolio includes Own Software, Advisory & Services and Hardware-as-a-
Service on contracts of 24 months or more excluding mobile expenses management (MEM) white
label (with three months’ notice before year-end). Calculated as the recognized recurring revenue
each quarter, annualized.
LTM
Last Twelve Months. Sum of each month for the historical period of the previous 12 months. Used for
gross profit and EBITDA adjusted.
Annual report 2022
140
APM's in the income statement
2022
2021
Total revenue
1 323 126
1 305 090
Cost of goods sold
-863 007
-845 305
Gross profit
460 119
459 785
Gross margin
35%
35%
Salaries and personnel costs
-265 027
-281 620
Other operational costs
-109 626
-108 549
Other income
40 058
22
Other expenses
-10 015
-17 209
EBITDA
115 509
52 431
Depreciation
-109 222
-108 229
Impairment
0
0
EBITA
6 287
-55 799
Amortisation
-58 492
-54 723
EBIT
-52 205
-110 523
Net gross profit
2022
2021
Gross profit
460 119
459 785
Depreciation from hardware-as-a-service
-92 840
-92 167
Net gross profit
367 279
367 618
Net gross margin
28%
28%
Adjusted EBITDA
2022
2021
EBITDA
115 509
52 431
Other income
-40 058
-22
Other expense
10 015
17 209
Adjusted EBITDA
85 466
69 616
Adjusted EBITA
2022
2021
EBITA
6 287
-55 799
Other income
-40 058
-22
Other expense
10 015
17 209
Adjusted EBITA
-23 756
-38 613
Total net operating expenses
2022
2021
Cost of goods sold
-863 007
-845 305
Salaries and personnel costs
-265 027
-281 620
Other operational costs
-109 626
-108 549
Depreciation
-109 222
-108 229
Amortisation
-58 492
-54 723
Annual report 2022
141
Impairment
0
0
Other expenses
-10 015
-17 232
Total net operating expenses
-1 415 389
-1 415 657
Revenue splits
2022
2021
Revenue
1 323 126
1 305 090
Hardware revenue
977 643
956 810
Solutions revenue
345 483
348 279
Hardware share of revenue
74%
73%
Solutions share of revenue
26%
27%
Annual report 2022
142
NIBD
2022
2021
Cash and cash equivalents
61 119
50 350
Non-current interest-bearing borrowings
90 665
97 402
Current interest-bearing borrowings
83 322
74 548
NIBD
-112 868
-121 600
Equity ratio
Total equity
571 520
555 586
Total equity and liabilities
1 323 300
1 314 654
Equity ratio
43%
42%
Debt to equity ratio
Total liabilities
751 780
759 069
Total equity
571 520
555 586
Debt to equity ratio
1.32
1.37
ARR
Number of own software users (1000)
71
66
Average price own software
1 107
1 050
MMS-Related ARR
78 600
69 613
Number of own software users (1000)
209
183
Average price MEM white label
154
152
White-label ARR
32 200
27 860
Total ARR from own IPP
110 800
97 473
Annual report 2022
143
Responsibility statement
Oslo, 27 April 2023
From the Board of Directors and CEO of Techstep ASA
We confirm, to the best of our knowledge, that the financial statements for the period 1 January to 31
December 2022, and the comparative figures presented for the period 1 January to 31 December 2021
have been prepared in accordance with current applicable accounting standards and give a true and
fair view of the assets, liabilities, financial position and profit or loss of the entity and the Group taken
as a whole. We also confirm that the Board of Directors’ Report includes a true and fair review of the
development and performance of the business and the position of the entity and the Group, together
with a description of the principal risks and uncertainties facing the entity and the Group.
Michael Jacobs
Chairman
Harald Arnet
Board member
Ingrid Leisner
Board member
Jens Rugseth
Board member
Melissa Ann Mulholland
Board member
Børge Astrup
CEO
Annual report 2022
144
Annual report 2022
145
Annual report 2022
146
Annual report 2022
147
Annual report 2022
148
Annual report 2022
149
Annual report 2022
150
GRI Standard
Reference
Disclosures
GRI 2:
2-1
Organisational details
Techstep ASA
General disclosures 2021
2-2
Entities included in the organisation’s
sustainability reporting
p. 7, 153
2-3
Reporting period, frequency and
contact point
1 January to 31 December 2022 (unless stated
otherwise). Annual reporting.
cathrine.birkenes@techstep.no
2-4
Restatements of information
See footnotes on p. 49
2-5
External assurance
The GHG report has been assured by BDO p.148-
149
2-6
Activities, value chain and other
business relationships
p. 5-7
2-7
Employees
p. 42
2-8
Workers who are not employees
Unavailable/incomplete
2-9
Governance structure and organisation
p. 30
2-10
Nomination and selection of the highest
governance body
Corporate governance report, p. 52-53
2-11
Chair of the highest governance body
p. 16 and p. 54
2-12
Role of the highest governance body in
overseeing the management of
impacts
p. 30
2-13
Delegation of responsibility for
managing impacts
p. 30
2-14
Role of the highest governance body in
sustainability reporting
p. 30
2-15
Conflicts of interests
Corporate governance report, p.54
2-16
Communication of critical concerns
p. 47, Code of conduct
2-17
Collective knowledge of the highest
governance body
p. 30
2-18
Evaluation of the performance of the
highest governance body
p. 30
2-19
Remuneration policies
Corporate governance report + Remuneration
policy
2-20
Process to determine remuneration
Corporate governance report + Remuneration
policy
2-21
Annual total compensation ratio
The organization’s highest paid individual is the
CEO. Total compensation ratio (CEO vs employee
average): 9.2. Additional information on CEO
remuneration can be found in the Remuneration
Report 2022.
2-22
Statement on sustainable development
strategy
p. 28-29
2-23
Policy commitments
p. 30, ESG policy
Annual report 2022
151
2-24
Embedding policy commitments
p. 30, p. 44
2-25
Process to remediate negative impacts
p. 43-45
2-26
Mechanisms for seeking advice and
raising concerns
p. 47, Code of conduct
2-27
Compliance with laws and regulations
No non-compliances during the year
2-28
Membership associations
UN Global Compact, Sustainability Board of Tech
Sweden
2-29
Approach to stakeholder engagement
p. 31
2-30
Collective bargaining agreements
All employees in Sweden are covered by collective
bargaining agreements
Stakeholder engagement
GRI 3:
Material topics 2021
3-1
Process to determine material topics
p. 32
3-2
List of material topics
p. 32
Material topics
Ethical business conduct
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 47, Code of conduct
GRI 205:
Anti-corruption 2016
205-1
Operations assessed for risks related to
corruption
All business areas in the group
205-2
Communication and training about
anti-corruption policies and procedures
Mandatory signature on Code of Conduct for all
employees
205-3
Confirmed incidents of corruption and
actions taken
No incidents reported during 2022.
GHG emissions (climate and environmental impact)
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 34
GRI 305: Environment
305-1
Direct (Scope 1) GHG emissions
p. 34-35
305-2
Energy indirect (Scope 2) GHG
emissions
p. 34-35
305-3
Other indirect (Scope 3) GHG emissions
p. 34-35
305-4
Emission intensity (Scope 1 & 2 per NOK
million revenue)
p. 34-35
305-5
Reduction of GHG emissions
p. 36
Circularity
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 33
GRI 306:
Waste
306-1
Waste generation and significant
waste-related impacts
p. 34-35
Annual report 2022
152
GRI 306:
Topic-specific
Management approach
disclosures
306-2
Management of significant waste-
related impacts
p. 33
Techstep-specific
disclosure
Number of mobile devices received
p. 33
Avoided emissions (scope 4)
p. 33
Responsible sourcing and supply chain management
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 43-45
GRI 308:
Supplier environmental
assessment 2016
308-2
Negative environmental impacts in the
supply chain and actions taken
p. 43-45
GRI 214:
Supplier social assessment
2016
414-2
Negative social impacts in the supply
chain and actions taken
p. 43-45
Cybersecurity & data
privacy
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 46
GRI 418: Customer privacy
418-1
Substantiated complaints concerning
breaches of customer privacy and
losses of customer
p. 46
Gender equality
GRI 3:
Material topics 2021
3-3
Management of material topics
p. 38
GRI 405:
Diversity and equal
opportunity
405-1
Diversity of governance bodies and
employees
p. 38, 42
Annual report 2022
153
Mandatory concepts
Name of reporting entity or other means of identification
Techstep ASA
Explanation of change in name of reporting entity or
other means of identification from end of preceding
reporting period
Domicile of entity
Norway
Legal form of entity
ASA
Country of incorporation
Norway
Address of entity's registered office
Brynsalléen 4, NO-0667 Oslo
Principal place of business
Description of nature of entity's operations and principal
activities
Name of parent entity
Techstep ASA
Name of ultimate parent of group
Techstep ASA
Annual report 2022
154