1Q 2018 Summary Loudspring Plc

Releases

Loudspring Plc

Company release

20 April 2018 at 8:30 (EET)

Please note that this is not a fully comprehensive report of all events, nor is it in any way a financial performance report. It is a summary of the main events that are public and that affected us and our portfolio during the quarter.

In the quarterly report we will not comment on every portfolio company but focus on Loudspring core holdings. On venture and incubation portfolio companies we will only comment on those firms where we feel the company has achieved milestones or had developments that are worth reporting. To get a comprehensive overview of individual portfolio companies’ businesses one should review additional documents such as the company description and the supplement to the company description that were published in 2016. These documents are available at loudspring.earth/share/governance .

Significant events

PlugSurfing was fully acquired by Fortum in March 2018. Both parties agreed not to disclose the contract value. Loudspring owned 3.1% of PlugSurfing before the sale returned the invested capital and yielded approximately 18% annual return during the time the company was in the Loudspring portfolio.

Nocart project and receivables status was given in March 2018. Nocart CEO Vesa Korhonen informed that the Zambia project has experienced some delays and there will likely be a deviation from the originally outlined schedule. Nocart also announced that the previously communicated 14MUSD 10MW solar power plant project in Kenya has started and is progressing according to the forecast.

Main markets: Finland, Asia, Africa.  

Eagle Filters investment and share swap was announced in January 2018. Loudspring acquired a majority stake in Eagle Filters. After the transaction, Loudspring owned 63.4% of Eagle Filters, up from 34%.  Agreements have been made with Eagle Filters and its current owners giving Loudspring the option to increase its ownership further up to 80%.  Eagle revenues Q1/2018 have been exceptionally strong, based mainly on increased repeat orders from existing customers. Recruitment of additional sales and technical sales support personnel is underway.

Main markets: Europe, North and South America, Asia and Africa

Nuuka Solutions received a capital loan from Loudspring in December 2017. The loan includes a right to convert the loan into equity earliest in March 2018. If the conversion right (including accrued interest) is exercised, Loudspring becomes the majority owner of Nuuka. Nuuka´s Q1/2018 has been a busy quarter. The company has been implementing their next generation smart building analytics in two major new sites in the Netherlands and continued scaling their solution in the Nordics. During Q2/2018 Nuuka aims to announce a number of new customers and will continue to grow and expand their business both in the Nordics and the Benelux.

Main markets: Finland, The Netherlands, Sweden, USA.

ResQ Club investment round was lead by Loudspring in January 2018. Loudsprings stake in ResQ Club is now 19.4% fully-diluted. ResQ Club grew its monthly sales over platform by 8,5% during Q1. The growth was a bit slower than projected, mainly due to stagnant growth in February. The reasons for this were: a temporary negative PR storm in Finland; and operational changes in Germany. End-of-March performance brought the company back on the projected growth track. Furthermore, the operational changes in Germany have brought the cost structure down to sustainable levels for the given market, which can be seen in the overall burn rate of the company from March onwards. On the partner side, Q2 is about implementing new sales processes with new tools to both Sweden and Germany, which aims to accelerate the expansion activities to the same level as it is in Finland. Furthermore, the focus is also on new ways to use their product in grocery stores and by chain restaurants.

Main markets: Finland, Sweden, Germany, The Netherlands

Sofi Filtration successfully completed industrial client pilots for large scale Sofi Filter systems in Finland. Sofi also continued application testing in the US, networking with both end-users and channel-to-market partners, preparing for industrial scale demonstration for Oil & Gas, and did a market study on the US with a potential funding partner. Sofi Filtration is increasingly being recognized globally, with requests for quotes from US, UK, China and Chile, and others. During Q2 Sofi is looking to close deals from the successful pilots and entering into agreements with at least one strategic industrial partner.

Main markets: Finland, USA  

Enersize had several significant events during Q1 2018. The biggest was the announcement of a technological breakthrough that makes it possible to automatically visualize and analyze compressor system efficiency. This has been put into immediate use in existing projects and will have a positive effect in several areas. Two patent applications have been filed for the innovation. Enersize has also recruited a new VP for China Operations and closed a revenue sharing deal with German company Dürr AG. As Enersize has previously communicated, during Q2 Enersize is expecting a number of ongoing installation agreements to continue into the revenue sharing phase.

Main markets: China, Finland, Germany, Sweden

Swap.com has been growing rapidly, although the growth rate has slowed down in 2017 as the company was focusing more on profitability by rising commission and lowering marketing spend. Revenue in 2017 was around €14 million. The management is still focusing heavily on profitability at expense of growth. With more than 2 million unique items Swap.com is now the biggest online consignment store in the US.

Main market: USA

Loudspring in brief

Loudspring is a company group focused on saving natural resources, with offices in the Nordics and California. The Loudspring companies are active on global markets in five sectors: energy, real estate, fashion, food and manufacturing. Loudspring management consists of company builders combining positive environmental impact with business for over a decade.

The company group is listed on First North Finland under the ticker LOUD and on First North Stockholm under the ticker LOUDS.

www.loudspring.earth

LinkedIn: https://www.linkedin.com/company/loudspring/

Twitter: @loudspring

IG: @loudspring_earth

FB: @loudspringco

Contact information:

Alexander Lidgren, Managing Director of Loudspring Plc. Tel. 46 73 660 1007, bigge@loudspring.earth

Access Partners Oy, Certified Advisor. Tel. 358 9 682 9500