Rapport 2015 enkeltsider høyoppløst uten skjæremerker

ANNUAL REPORT

2015

TURNING KNOWLEDGE INTO VALUE

02

MERIT GLOBE ANNUAL REPORT 2015

Turning knowledge into value Merit is a leading provider of consulting services and software for business processes and implementation of ERP systems.

Merit offers customers higher competitiveness through the implementation and operation of modern and integrated standard solutions.

Through our deep industry knowledge, business expertise and experience, we help you transform information into relevant knowledge - thus our slogan Turning Knowledge into Value.

Operations Merit Globe AS (MGAS) is the parent company of the Merit Group and a provider of business solutions and enterprise management solutions within defined industries.

MGAS has more than 240 employees in nine countries in Northern and Central Europe.

The company's products are based on the business system Infor M3, together with its own software developed within the mobile solutions arena and also business intelligence (BI).

In addition to its being a parent company and holding company, MGAS is also an organisation that performs joint functions such as corporate management, management within our areas of business, economics and finance, IT, marketing and business development.

Merit has expanded in order to further develop its position in the markets where we have a presence. We are of the opinion that there are still many very interesting opportunities in the markets we are in. In 2015, however, we focused on further consolidating our business to improve our own profitability. This will also be an area of focus for us during 2016.

Merit is a leading provider in selected industries of primarily business solutions (ERP), such as Infor M3. This has positioned us well within the industries we are targeting through our own software obtainable through the Merit Portal.

Main market The market remained stable throughout 2015. The new version of Infor M3 continued to be strongly in demand with our existing customers in the markets in which we operate. Our own applications (Merit Portal/Best of Breed) and the service-based concepts (Merit Operations and Merit Partnership) also contributed to an even and, recently, increased demand and a greater number of long-term agreements were entered into during the year.

We are also experiencing increased demand for various types of hosting services as well as "Cloud" and this has had a role in shaping our product development and our unique solution concepts. Meanwhile, sales of our mobile solutions are increasing, specifically those sales solutions based on tablets and smart phones. This means that the interface to the ERP solution is shifting, and a constant flow of new user groups are involved, both internally and externally.

We have a partnership agreement with Infor applicable to Central Europe, Western Europe and Scandinavia. This agreement provides us with an excellent framework for further growth.

Infor is a leading global software company, and has development plans for M3 and other applications that are very exciting. With Infor as a partner, we will also be able to offer the best solutions to our defined markets in future.

MERIT GLOBE ANNUAL REPORT 2015

Everything you need

we have.

Merit Globe offers a wide range of services and products. We can provide you with business solutions from early requirements to go-live with continuous improvements.

From Merit you can buy hardware, software and expertise from our talented consultants.

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MERIT GLOBE ANNUAL REPORT 2015

Merit Portal Merit offers a range of products designed to increase efficiency in our customers operations.

Thanks to its focus on solving the challenges of target industries, and its extensive experience in software development, Merit has delivered customized software solutions to more than 100 clients. With Merit you can count on the positive power of the most advanced technologies allied to our profound knowledge of industry.

BUSINESS INTELLIGENCE Merit Intelligence is a pre-built BI Application, where all the data you need has already been put together, analyzed and are represented in our reports and dashboard packages.

SUPPLY CHAIN Merit Portal Supply Chain will improve productivity and reporting quality both inside and outside your warehouse.

MANUFACTURING Improve your operation efficiency and accuracy on your shop floor with Merit Portal Manufacturing.

MERIT GLOBE ANNUAL REPORT 2015

edge into Turning Knowl Value!

SERVICE

SUPPLIER

Improve the efficiency of your field / in-house services, as well as your customer services, with Merit Portal Services.

Merit Portal Supplier allows you to create and exchange electronic business documents with your trading partners, regardless of their dimension or technical expertise. With Merit Portal Supplier lets you exchange business data with your trading partners, regardless of their size of technical expertise.

SALES Improve customer satisfaction and optimize Order Handling with Merit Portal Sales.

CLAIMS The undue wait for replacement deliveries - or credits - are potential sources of customer dissatisfaction. With Merit Portal Claims you can design a Claims Portal optimized to deal with these potential issues.

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MERIT GLOBE ANNUAL REPORT 2015

2014

311.744.335

2015

341.249.660

2014

308.708.482

2015

341.399.578

OPERATING INCOME

OPERATING EXPENSES

During 2015, Merit’s operating income was NOK 341,249,660 – a slight increase from its 2014 operating income of NOK 311,744,335. Rates for the group’s hourly services showed an increase in 2015.

Merit’s overall costs development showed a slight increase in 2015 and total operating expenses amounted to NOK 341,399,578, as against NOK 308,708,482 in 2014.

PROFIT

PROFIT PARENT COMPANY Since the merger in 2010, the parent company has only had internal revenues, financial income and expenses.

It was decided to pay out dividends and Group contributions from certain subsidiaries, to a total nominal value of NOK 3,481,280.

This yielded a profit for 2015 of NOK 1,769,269.

2015

16.281.571 2014

20.581.490

2015

1.769.269

PROFIT AFTER TAX

In 2015, operating profit before depreciation (EBITDA) was NOK 16,281,571, compared with NOK 20,581,490 for the corresponding period of the previous year. The EBITDA margin closed at 4.8%.

2014

223.711

Profit after tax for 2015 was NOK -189,101, down from NOK 223,712 in 2014.

Economy & finance

15% 4,8%

2015

-189.101

KPI GOAL Merit has a long-term goal of attaining an EBITDA margin of 15 per cent.

The Group will continue to focus strongly on further streamlining its operations.

MERIT GLOBE ANNUAL REPORT 2015

DEBT As at year-end, Group debt was NOK 85,672,971.00 of which NOK 8,843,489.00 is bank debt.

GROUP DEBT

85.672.971

10.526.970

CASH Cash and cash equivalents of NOK 10,526,970 have been placed in the bank. Merit has a group account solution (cash pool) together with a corresponding credit facility at the bank. This solution makes it possible to utilise excess liquidity in the group.

BANK DEBT

8.843.489

BALANCE

EQUITY

At year-end, Merit had a balance sheet total of NOK 122,280,042.

Accounts receivable in 2015 amounted to NOK 67,592,061.

The Group has conducted a review of receivables and regards them as solid.

2015

122.280.042

30,6 29,2 2014

RECEIVABLES

67.592.061

ALLOCATION OF PROFITS 2015 Transferred to other equity Total

1.769.269 1.769.269

2015

Group equity amounted at the balance sheet date to NOK 36,607,071. It has been very important for Merit to increase the company’s financial strength. Group solvency as measured by equity ratio at the end of the year was 29.2 per cent compared with 30.6 per cent for the previous year. Merit's goal is to maintain an equity ratio of 30 per cent in the future.

49,1

Parent company equity As at 31 December 2015, the parent company had an equity ratio of 49.1%.

2015

FINANCIAL CONDITIONS In accordance with §3-3a of the Norwegian Accounting Act, the Board confirms that the preconditions for a going concern are in place, and that the financial statements for 2015 have been prepared based on this assumption. The basis for this is the group’s long-term forecasts together with its position vis-a-vis equity and liquidity.

FINANCIAL RISKS The main financial risks to which the group is exposed are related to foreign exchange, liquidity and credit. The management undertakes ongoing assessment of these risks and lays down guidelines for how they should be dealt with. Merit's financial strategy is to hold sufficient liquid assets or credit at any given time to enable it to finance its operations and Group Strategy.

Excess liquidity has been invested in the bank. The group's customer portfolio consists mainly of large solvent companies and organisations with high credit ratings. New business contacts to whom credit is to be extended are subject to an assessment of their creditworthiness. During the course of 2014/2015, the company improved its procedures in following up outstanding receivables and focused more on collections in accordance with the agreed payment terms.

07

08 243 employees 9 countries 22 offices

Organization Merit's business activities have a good geographic spread over Scandinavia and Central Europe and the company has a presence in 9 countries with 22 offices. In 2015 we had 240 employees. During the year, Merit expanded its organisation both geographically and in terms of new services and product offerings. An example of the latter is the creation of Merit Operations, which was established because more customers are seeing the benefits from our increased monitoring and following up of the company’s value-added processes.

This implementation is an integral part of Merit's existing operations that shall contribute to making our customers stronger. Merit will continue to build on this established strategy in Europe. We now have customers in a number of countries and will be focusing on sales and implementation of products and services we have now developed.

COMPETENCE BUILDING Solution Consulting has been established at group level with participants from all Merit companies. This body is responsible for acquiring expertise in new product areas and new functionality and is active in defining which areas Merit should be focusing on and consolidating its skills in. Merit Project and Merit Operations safeguard, respectively, implementation projects and the operating environments of implemented solutions. In principle, these two areas encompass all of Merit’s consulting staff.

MERIT’S SERVICE ORGANIZATION FOCUSES ON THE FOLLOWING AREAS:

MERIT SERVICES SOLUTION CONSULTING Responsible for Presales activities Responsible for Presales materials Be the forefront to collect information about new products Heading Pre-study projects Quality assurance in projects

PROJECTS

OPERATIONS

Proven implementation methodology

Service Desk

Deep industry knowledge for the focused verticals

Application Monitoring

Complete resource teams

Process Improvement

Scalable from small local projects to large and international projects

Hosting and Surveillance

Application Support Process Monitoring

EXPERT GROUPS Merit has been working on the creation of groups with and for a variety of areas of expertise.

These areas could be connected with specific industries, solutions or process areas. These skills groups are organised nationally through contact points and via international cooperation.

CERTIFICATION Merit places a strong focus on competence building. This applies both to our own products and to products from our partners. For example, in respect of our biggest partner Infor, we have always been quick to develop our skills in new versions.

When the previous version of Infor M3 was launched, Merit was the first in the world to implement it with its customers. In other respects, Merit makes every effort to be well ahead inasmuch as certification in the implementation and use of Infor software is concerned. This also includes the establishment of internal requirements and competency certification in evaluating expertise and experience in a range of different areas.

EFFECTS ON ENVIRONMENT Merit has taken a number of measures to reduce pollution of the external environment. We use video and web conferencing to the greatest extent possible to reduce the number of flights we take.

We minimise our use of paper printouts and our hardcopy printers have default settings to print on both sides.

MERIT GLOBE ANNUAL REPORT 2015

JOB SATISFACTION The parent company Merit Globe AS had 3 employees during 2015. As of 31 December 2015, the Group had 240 employees. The Board considers the working environment to be satisfactory. Sick leave in the group is considered to be normal. There have been no serious injuries in connection with the carrying out of work in the group. We are very involved in the workplace environment and job satisfaction.

Committed and motivated work colleagues create good contracts and satisfied customers. Merit wants to facilitate healthy, shared experiences outside working hours.

RESEARCH & DEVELOPMENT Merit Globe AS has a multi-year R&D project funded by SkatteFUNN (an organisation run by the Research Council of Norway) for the period 2015 - 2017.

The company has sought funding from SkatteFUNN for 2015 to the extent of NOK 634,793.

Sports and other extracurricular activities ensure a way of being together other than that provided by the working day.

Many have been really good at getting to know each other through, for example, skiing, biking, running and other recreational pursuits. Some of the opportunities have been arranged by the company, while others have been started by enterprising colleagues.

An important part of Merit's business is the sale and implementation of our proprietary products via the Merit Portal.

More than 100 of our customers use our products in their daily operations. The aim of Merit Portal is to offer our customers products that make work processes more efficient and user-friendly at the same time as providing access to critical business data in a simple and intuitive way.

Our products currently have a firm foothold in the fields of data warehousing and analysis as well as transaction reporting in the value chain. Our solutions are used both via web interface on PCs and through mobile devices where bar code reporting is used extensively.

In 2015, our product development was particularly targeted at further expansion of our portal concepts, such as sales portals and supplier portals. We have also developed and implemented solutions on mobile platforms such as iOS and Android.

These solutions are focused on exploiting the opportunities created by new technologies along with tight integration with corporate ERP systems. Demand for such solutions is growing rapidly as evidenced by our future product development.

Our product development organisation comprises product specialists with extensive business knowledge, and developers with a broad and in-depth technical expertise. We want to offer our employees an engaging and interesting workplace by providing them with opportunities to work closely with our customers and business consultants, at the same time as we invest a significant proportion of our licence and maintenance revenue in innovation and research. We are concerned that our employees should continuously expand and develop their skills, along with providing them with opportunities for influencing our future products both functionally and technologically. This has led to our Development Department being seen as an attractive employer for both current and new employees.

DISCRIMINATION AND EQUALITY Merit employees are obliged to contribute to a positive and professional workplace environment. This means that they should treat one another with respect and that all forms ofdiscrimination are unacceptable.

This includes discrimination based on religion, colour, gender, sexual orientation, age, nationality,race and disability. The company and the group are actively working to promote equality, ensure equal opportunities and rights and to prevent discrimination.

Merit has a long-term goal of increasing the proportion of women among its employees, but consideration of appropriate skills will however always be paramount when recruiting.

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MERIT GLOBE ANNUAL REPORT 2015

Income statement PARENT COMPANY 2015

GROUP 2014

REVENUE

NOTE

Sales revenue

5, 8

0

0

11 159 266

10 900 678

Other operating income

11 159 266

10 900 678

Total revenue

2015

2014

338 436 320

310 308 623

2 813 429

1 435 711

341 249 660

311 744 335

23 072 617

18 236 879

221 242 396

204 797 703

OPERATING EXPENSES 949 274

704 725

7 151 622

7 427 500

203 818

295 428

6 104 427

Cost of stocks Payroll expenses

4

Depreciation of tangible and intangible fixed assets

6, 7

16 431 489

17 545 638

5 900 752

Other operating expenses

4

80 653 076

68 128 261

14 409 141

14 328 405

Total operating expenses

341 399 578

308 708 482

-3 249 875

-3 427 727

Operating result

3 035 852

FINANCIAL INCOME AND EXPENSES Income from investments in subsidiaries and assosiated companies

0

0

Income from other investments

0

0

Interest income from group companies

0

0

3 481 280

9 349 640

0

0

731 748

785 434

1 938 279

1 245 057

Other financial income

2 930 208

2 221 584

1 429 596

2 247 438

Other financial expenses

2 696 057

2 918 175

4 721 711

9 132 693

Net financial items

234 151

-696 591

1 471 836

5 704 966

Ordinary result before tax

84 233

2 339 261

-297 433

114 167

273 342

2 115 550

1 769 269

5 590 799

-189 101

223 711

Majority interests

0

-763 028

Minority interests

0

986 739

Tax on ordinary result

12

Net profit or loss for the year

ALLOCATED AS FOLLOWS 0

5 000 000

Proposed dividends

13

1 769 269

0

Transferred to other equity

13

0

590 799

Uncovered losses

13

5 590 799

588 023

Total allocations

11

MERIT GLOBE ANNUAL REPORT 2015

Balance sheet as of December 31 PARENT COMPANY 2015

GROUP 2014

FIXED ASSETS

NOTE

2015

2014

Intangible assets 0

0

300 909

3 476

0

0

300 909

3 476

Research and development

7, 8

1 760 745

5 170 582

Deferred tax asset

12

2 273 367

1 454 537

Goodwill

7

20 997 312

21 611 066

25 031 425

28 236 185

1 486 455

1 958 838

1 486 455

1 958 838

Total intangible assets

Tangible assets 54 352

231 507

Fixtures and fittings, tools, office machinery etc.

54 352

231 507

Total tangible assets

6

Financial assets 90 458 236

79 225 476

Investments in subsidiaries

2

33 320

0

17 820 708

16 494 122

Other receivables

10

988 527

988 526

108 278 944

95 719 598

Total financial assets

1 021 847

988 526

108 634 205

95 954 581

Total fixed assets

27 539 726

31 183 550

CURRENT ASSETS Receivables 1 575 170

760 871

Trade receivables

11

67 592 061

66 042 499

9 596 920

18 785 355

Other receivables

11, 12

16 621 285

12 159 977

11 172 090

19 546 226

Total accounts receivable

84 213 346

78 202 476

1 112 544

1 157 989

Cash and cash equivalents

10 526 970

8 168 577

12 284 634

20 704 215

94 740 316

86 371 053

120 918 839

116 658 796

122 280 042

117 554 603

Total current assets

Total assets

9

12

MERIT GLOBE ANNUAL REPORT 2015

Balance sheet as of December 31 PARENT COMPANY 2015

GROUP 2014

EQUITY

NOTE

2015

2014

Paid-in capital 1 754 751

1 754 751

Share capital

13, 14

1 754 751

1 754 751

-12 833

0

Own shares

13

-12 833

0

0

0

Share premium reserve

13

0

0

0

0

Other paid-in capital

13

0

-39

1 741 918

1 754 751

Total paid-in capital

1 741 918

1 754 712

Retained earnings 61 378 267

59 897 741

Other equity

13

61 378 267

59 897 741

Total retained earnings

0

0

63 120 185

61 652 492

34 865 154

32 477 783

34 865 154

32 477 783

0

1 788 317

36 607 071

36 020 851

8 843 489

8 082 068

Minority interests

Total equity

LIABILITIES Current liabilities 8 843 489

6 370 035

Liabilities to financial institutions

9, 10

2 915 687

791 231

Trade creditors

11

15 832 524

9 516 966

0

105 227

Tax payable

12

1 259 969

2 264 540

239 942

296 170

Public duties payable

9

16 908 066

11 905 580

45 799 536

47 443 641

Other short-term liabilities

2, 11

42 828 923

49 764 597

57 798 654

55 006 304

Total current liabilities

85 672 971

81 533 752

57 798 654

55 006 304

Total liabilities

85 672 971

81 533 752

120 918 839

116 658 796

122 280 042

117 554 603

Total equity and liabilities

Ålesund, 16. March2016

Erik Outzen CEO

Bjørn Haukebø Chairman of the Board Egil Gussiås Board member

Mette Kamsvåg Board member

Markus Herbert Tronich Board member

Pål Marius Rødseth Board member

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MERIT GLOBE ANNUAL REPORT 2015

Cash flow statement PARENT COMPANY

GROUP CASH FLOW FROM OPERATING ACTIVITIES

2015

2014

1 471 836

5 704 966

-3 481 280

-9 230 365

-105 227

-261 915

Taxes paid

0

-119 275

Profit on sale of fixed assets

203 818

295 428

1 310 157

-943 315

5 101 597

22 610 261

4 500 901

18 055 785

Profit/(loss) before taxes

2015

2014

84 233

2 339 261

0

0

-1 723 458

-989 402

0

0

16 431 489

17 545 638

6 343 407

-555 611

Changes in other current balance sheet items

-2 901 858

-2 971 583

Net cash flow from operating activities

18 233 813

15 368 303

132 043

0

-502 804

-441 594

0

0

-33 320

0

0

0

0

0

-11 636 841

-441 594

761 421

-15 872 050

-5 000 000

0

0

0

Net cash flow from financing activities

-4 238 579

-15 872 050

Net change in cash and cash equivalents

2 358 393

-945 341

Income from associate

Depreciation and amortisation Changes in inventories, trade receivables and trade payables

CASH FLOW FROM INVESTING ACTIVITIES 0

0

-26 664

-102 623

0

119 275

-11 232 760

0

-1 326 586

-1 265 891

0

0

-12 586 010

-1 249 239

Proceeds from sale of of tangible fixed assets Purchase of tangible fixed assets Proceeds from sale of investments in shares and joint ventures Purchase of investments in shares and joint ventures Purchase of other investments

Net cash flow from investing activities

CASH FLOW FROM FINANCING ACTIVITIES 2 473 454

-17 584 083

Repayment of short term loans

-5 000 000

0

10 566 210

0

8 039 664

-17 584 083

-45 445

-777 537

1 157 989

1 935 526

Cash and cash equivalents at 01.01

8 168 577

9 113 918

1 112 544

1 157 989

Cash and cash equivalents at 31.12

10 526 970

8 168 577

Dividends payed

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MERIT GLOBE ANNUAL REPORT 2015

Notes 01 Accounting Principles The annual report is prepared according to the Norwegian Accounting Act 1998 and generally accepted accounting principles.

Basis for consolidation The consolidated financial statements comprise the parent company Merit Globe AS and subsidiaries as described in note 2. Subsidiaries are companies in which the Group has a controlling interest. A controlling interest is normally achieved when the Group owns more than 5O% of the shares in the company and is also in the position to exercise control over the company. The minority share of the equity is included in the consolidated equity. The consolidated accounts are prepared such that the group of companies are presented as a single economic entity. Intercompany transactions have been eliminated from the consolidated accounts. The consolidated accounts are prepared according to the same accounting principles for both parent and subsidiaries. Acquired subsidiaries are reported in the annual accounts on the basis of the parent company’s acquisition cost. The acquisition cost is identified by attributing fair values to the separable net assets acquired. Surplus value or values below the fair value of separable net assets are reported in the balance sheet as goodwill or negative goodwill. Goodwill is amortized linearly through the profit and loss account over its expected useful economic life. Subsidiaries are consolidated in the accounts when a controlling interest is achieved until it no longer applies.

Subsidiaries and investment in associate Subsidiaries and investments in associate are valued by the cost method in the company accounts. The investment is valued as cost of acquiring shares in the subsidiary, providing that write down is not required.

Write down to fair value will be carried out if the reduction in value is caused by circumstances which may not be regarded as incidental, and deemed necessary by generally accepted accounting principles.

Write downs are reversed when the cause of the initial write down are no longer present.

Dividends and other distributions are recognized in the same year as appropriated in the subsidiary accounts. If dividends exceed withheld profits after acquisition, the exceeding amount represents reimbursement of invested capital, and the distribution will be subtracted from the value of the acquisition in the balance sheet.

Sales revenue Sales revenues are recognized at the time of delivery. Revenues from services are recognized at execution. The share of sales revenue associated with future services are recorded in the balance sheet as deferred sales revenue, and are recognized at the time of execution. Revenue from projects on fixed price terms that run over a longer period of time are recognized according to the degree of completion.

The degree of completion is estimated based on time consumed in relation with estimated total time on the project.

Balance sheet classification Net current assets comprise creditors due within one year, and entries related to goods circulation. Other entries are classified as fixed assets and/or long term liabilities. Current assets are valued at the lower of acquisition cost and fair value. Short term creditors are recognized at nominal value. Fixed assets are valued by the cost of acquisition, in the case of non-incidental reduction in value the asset will be written down to the fair value amount. Long term creditors are recognized at nominal value.

Trade and other receivables Trade receivables and other current receivables are recorded in the balance sheet at nominal value less provisions for bad debts. Provisions for bad debts are calculated on the basis of individual assessments. In addition, for the remainder of accounts receivables outstanding balances, a general provision is carried out based on expected loss.

Foreign currency translation Foreign currency transactions are translated using the year end exchange rates.

Property, plant and equipment Property, plant and equipment is capitalized and depreciated over the estimated useful economic life. Direct maintenance costs are expensed as incurred, whereas improvements and upgrading are assigned to the acquisition cost and depreciated along with the asset. If carry-

ing value of a non-current asset exceeds the estimated recoverable amount, the asset is written down to the recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value.

Research and development Research and development costs are capitalized providing that a future economic benefit associated with development of the intangible asset can be identified.

Otherwise, the costs are expensed as incurred. Capitalized research and development are amortized linearly over the economic lifetime.

Income tax Tax expenses in the profit and loss account comprise both tax payable for the accounting period and changes in deferred tax. Deferred tax is calculated at 27 percent on the basis of existing temporary differences between accounting profit and taxable profit together with tax deductible deficits at the year end.

Temporary differences, both positive and negative, are balanced out within the same period. Deferred tax assets are recorded in the balance sheet to the extent it is more likely than not that the tax assets will be utilized. Tax payable and deferred tax is recorded directly against the equity to the extent that the tax positions relate to equity transactions.

Cash flow statement The cash flow statement is presented using the indirect method. Cash and cash equivalents includes cash, bank deposits and other short term highly liquid placement with original maturities of three months or less.

Use of estimates The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts in the profit and loss statement, the measurement of assets and liabilities and the disclosure of contingent assets and liabilities on the balance sheet date. The estimates are related to capitalization of R&D, provision for bad debts and evaluation of projects. Actual results can differ from these estimates.

MERIT GLOBE ANNUAL REPORT 2015

02 Investment in subsidiaries and associate PARENT COMPANY Company

Acquisition year

Location

Share owners

Net profit 2015

Equity 31.12

Book value 31.12

Merit Consulting AS

2010

Norway

100 %

5 013 977

21 194 456

19 219 030

Merit Platform Partner AS

2009

Norway

100 %

4 747 235

7 396 862

11 809 260

Merit Consulting OY

2008

Finland

100 %

-5 398 473

2 002 247

25 882 782

Merit Consulting AB**

2009

Sweden

100 %

5 684 339

10 359 494

5 498 479

Merit Consulting AS

2009

Denmark

100 %

778 936

2 867 225

5 638 311

Merit Consulting GmBH

2010

Germany

100 %

1 201 331

5 937 116

4 937 847

Merit Central Europe AG

2010

Switzerland

100 %

-198 628

5 170 287

15 893 768

Merit Consulting UK

2008

England

100 %

27 942

-8 619 951

1 578 759

Axcentro Solutions LLC*

2010

Switzerland

Capesso Provider AS*

2011

Norway

Merit Czech Consulting s.r.o.*

2013

Czech Rep.

Merit South West Europe Gmb *

2015

Switzerland 11 856 659

46 307 736

90 458 236

Total

* Axcentro Solutions LLC, Capesso Provider AS and Merit Czech Consulting s.r.o and Merit South West Europe GMB are included in the Group, but are owned by subsidiaries. ** Tirem Invest AB was in 2014 sold to, and subsequently merged with, Merit Consulting AB.

03 Financial market risk PARENT COMPANY

The company and the Group are exposed to interest- and exchange rate risk. The Group has no formal hedging strategy.

with a financial institution at floating interest rates. The company has not entered into any fixed rate contracts.

Interest risk The company has overdraft facilities

Exchange rate risk The company and the Group have trans-

actions in different currencies. It is not entered into any hedging transactions to reduce this risk. However, the risk is reduced by the fact that income and expenses in each company of the group is mainly in the same currency.

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16

MERIT GLOBE ANNUAL REPORT 2015

04 Wage costs, number of employees, remuneration,

loans to employees and auditor’s fee

PARENT COMPANY

GROUP

2015

2014

3 353 541

3 355 318

472 187

518 603

146 093

181 743

3 814 594

3 371 836

-634 793

0

7 151 622

7 427 500

3

3

WAGE COSTS

2015

Salaries

2014

170 042 764

158 244 467

Payroll tax

26 001 356

24 021 573

Pension costs

17 253 993

15 519 459

Other renumerations

11 733 834

8 128 524

-3 789 551

-1 116 320

221 242 396

204 797 703

240

243

Total Average number of employees

PARENT COMPANY

Other remunerations include administrative costs for Group management, amounting to NOK 3 667 366 (2014: NOK 3 221 359) Board of directors’ remuneration has been paid, at NOK 295 000 in 2015.

Bonus of NOK 150 000 is expensed to management in 2015.

Management remuneration

Chief Executive Officer

Salary 1 315 984

Other remuneration 196 897

The parent company is obliged to have a pension plan according to Norwegian pension regulations.

The company employs a pension plan that meets the criteria in the regulations.

The managing director is included in the company’s general pension agreement.

GROUP

Management remuneration Some of subsidiaries are obliged to have a pension plan according to Norwegian pension regulations.

The companies have a pension plan that meets the criteria in the regulations.

PARENT COMPANY

Loans and guarantees for management, representatives and stockholders etc.

The company has not provided loans or security to anyone in the management or shareholders, or any of their affiliates.

PARENT COMP. 2015

GROUP Auditor fee has been divided as follows

2015

191 000

Statutory audit fee

612 085

0

Assurance services

30 010

9 000 1 405 784

Tax advisory fee Other services VAT is not included in the figures of auditor’s fee.

9 050 1 493 066

MERIT GLOBE ANNUAL REPORT 2015

Sales of goods

05

PARENT COMPANY 2015

GROUP 2014

2015

2014

Geographical distribution

06

0

0

Norway

148 537 914

149 236 265

0

0

Nordic countries

115 691 482

75 619 690

0

0

Europe

67 545 417

78 536 572

0

0

Other

6 661 416

6 916 096

0

0

338 436 230

310 308 623

Tangible assets

PARENT COMPANY

FIXTURE AND FITTINGS, TOOLS, OFFICE MACHINERY, ETC.

TOTAL

Aquisition cost 01.01.

946 459

946 459

Purchased tangibles

26 664

26 664

Acquisition cost 31.12.

973 123

973 123

Acc.depreciation 31.12.

-918 770

-918 770

54 353

54 353

203 818

203 818

Net carrying amount at 31.12.

Depreciation for the year Useful economic life: 3 years Amortization plan: Linear

FIXTURE AND FITTINGS, TOOLS, OFFICE MACHINERY, ETC.

TOTAL

9 730 646

9 730 646

502 804

502 804

-132 043

-132 043

171 848

171 848

Acquisition cost 31.12.2015

10 273 255

10 273 255

Acc.depreciation 31.12.2015

-8 786 800

-8 786 800

Net carrying amount at 31.12.2015

1 486 455

1 486 455

Depreciation for the year

1 014 992

1 014 992

GROUP Acquisition cost 01.01.2015 Purchased tangibles Disposals Conversion differences

Useful economic life: 3 years Amortization plan: Linear

17

18

MERIT GLOBE ANNUAL REPORT 2015

07

Intangible assets

GROUP

GOODWILL

R&D

TOTAL

Acquisition cost at 01.01.

66 068 568

16 511 474

82 580 042

Purchased intangibles

11 232 760

0

11 232 760

Conversion differences

0

159 837

159 837

Acquisition cost 31.12.

77 301 328

16 671 311

93 972 639

-56 304 016

-14 910 566

-71 214 582

Net carrying amount at 31.12.

20 997 312

1 760 745

22 758 057

Amortization for the year

11 846 513

3 569 984

15 416 497

Acc. amortization at 31.12.

Useful economic life: 5 years Amortization plan: Linear

Goodwill is considered to have a lifespan of five years, and is related to restructuring of the organization in 2012.

Additions of goodwill of 11.2 million NOK in 2015 are related to the purchase of the remaining shares in Merit Platform Partner in December 2015.

08

Government grants

PARENT COMPANY

Merit Globe AS has an ongoing development project that is approved as SkatteFUNN-project in Norway.

In total, the company has applied for grants amounting to NOK 634 793 in 2015. The grants are treated in accordance with NRS 4 Government grants, ie. grants are recorded as a reduction of the corresponding payroll expenses.

Total amount is recognized as other short term receivable, with a corresponding reduction in payroll expenses.

GROUP

Merit Platform Partner AS has an ongoing development project that is approved as SkatteFUNN-project in Norway.

In total, the company has applied for grants amounting to NOK 1 685 977 in 2015. The amount is recognized as a reduction in payroll expenses.

Merit Consulting AS has an ongoing development project that is approved as SkatteFUNN-project in Norway.

In total, the company has applied for grants amounting to NOK 1 286 573 in 2015. The amount is recognized as a reduction in payroll expenses.

MERIT GLOBE ANNUAL REPORT 2015

Bank deposit

09

PARENT COMP.

GROUP

2015

2015

134 301

3 089 178

PARENT COMPANY

The Merit Globe group has established a multi-account system where Merit Globe AS is the holder, while the other group companies are sub-account holders or participants. The bank can offset any balance against one another so that the net position represents the balance between Handelsbanken and Merit Globe AS. Each participant’s deposit or liability on the sub-account represents an intercompany balance with Merit Globe AS. These intercompany balances are classified as other current liabilities or other current receivables.

Debts and receivables

10

PARENT COMPANY

GROUP

2015

2014

1 575 170

760 871

Accounts receivables

54 352

231 507

Property, plant and equipment

1 629 522

992 378

Total

PLEDGED ASSETS

2015

2014

19 438 079

27 069 554

459 297

935 625

19 897 376

28 005 179

PARENT COMPANY

The parent company and the group have an overdraft facility agreement; cf. Note 9, of NOK 25 million in 2015. As of 31.12.2015 NOK 8 843 489 is drawn on this facility (2014: NOK 6 370 035). The assets in the table above are pledged as collateral.

There are financial covenants related to the agreement. The company meets all of these requirements as of 31.12.2015.

11

Intercompany balance group companies and associate

PARENT COMPANY RECEIVABLES

2015

2014

Accounts receivables

1 575 170

760 871

Other receivables

4 708 420

9 049 508

17 820 708

16 494 122

Dividends from Group companies

1 800 000

5 230 365

Group contribution

1 450 000

4 000 000

27 354 298

35 534 866

463 818

265 635

Other short term payables

43 004 933

42 119 075

Total

43 468 751

42 384 710

Long term receivables

Total

PAYABLES Trade creditors

19

20

MERIT GLOBE ANNUAL REPORT 2015

12

Income taxes PARENT COMPANY 2015

GROUP 2014

0

105 227

0

0

24 073

INCOME TAX EXPENSE Tax payable Too much/little allocated in previous year(s) This year’s tax effect of change in tax rate

-321 506

8 940

-297 433

114 167

Change in deferred tax Total income tax expense

2015

2014

1 259 969

2 264 540

-192 874

- 83 062

50 137 -843 890

-65 928

273 342

2 115 550

TAX BASE ESTIMATION 1 471 836

5 704 966

Ordinary result before tax

-578 588

14 787

-2 031 280

-5 230 365

Dividends from subsidiaries

-1 450 000

-4 000 000

Group contribution

0

-119 275

106 687

19 617

-2 481 345

-3 610 270

1 450 000

4 000 000

-1 031 345

389 730

Tax base

105 227

Tax payable (27%)

Permanent differences

Gain from sale of subsidiary Changes in temporary differences

Group contibution

TEMPORARY DIFFERENCES OUTLINED -172 288

-65 601

0

0

0

0

0

5 230 365

-172 288

-65 601

-1 031 345

0

-1 203 633

5 164 764 5 177 636

Fixed assets

-1 116 266

-318 631

Other differences

-285 599

-350 000

Accounting provisions

-389 288

-5 474 108

0

0

-1 791 153

-6 142 739

Loss carried forward

-25 266 367

-24 498 895

Net temporary differences

-27 057 520

-30 641 634

427 906

0

-27 485 426

-30 641 634

-5 788 444

-8 273 241

2 273 367

6 818 704

-3 515 077

-1 454 537

Recognized dividends from subsidiaries Total

Differences not included in deferred tax base

-1 203 633

-12 872

-300 908

-3 475

0

0

Deferred tax asset not in balance sheet

0

0

Deferred income tax liability in balance sheet

Total

Deferred tax asset (25% this year, 27% last year)

MERIT GLOBE ANNUAL REPORT 2015

13

Owners equity

PARENT COMPANY

SHARE CAPITAL

OTHER EQUITY

TOTAL

1 754 751

59 897 741

61 652 492

0

1 769 269

1 769 269

-12 833

-288 743

-301 576

1 741 918

61 378 267

63 120 185

SHARE CAPITAL

MINORITY INTR.

OTHER EQUITY

TOTAL

1 754 751

1 788 317

32 477 783

36 020 851

Profit for the year

0

0

-189 101

-189 101

Purchase of minority interests

0

-1 788 317

1 788 317

0

-12 833

0

-288 743

-301 576

0

0

1 076 897

1 076 897

1 741 918

0

34 865 153

36 607 071

Owners equity 01.01.

Profit for the year Purchase of own shares Owners equity 31.12.

GROUP Owners equity 01.01.

Purchase of own shares Conversion differences Owners equity 31.12.

21

22

MERIT GLOBE ANNUAL REPORT 2015

14

Share capital and shareholder information NUMBER OF SHARES

FACE VALUE

BOOK VALUE

1 754 751

1 NOK

1 754 751

Ordinary shares

Ownership share

Voting rights

Kjell Harald Danielsen

128 764

7,34 %

7,34 %

Erik Outzen, Daglig leder

116 782

6,66 %

6,66 %

Jon Kåre Aarskog

108 673

6,19 %

6,19 %

Markus Tronich, styremedlem

92 685

5,28 %

5,28 %

Arnfinn Hjellen

89 715

5,11 %

5,11 %

Frank Skorgen

76 195

4,34 %

4,34 %

Hallgeir Øvrebust

74 485

4,24 %

4,24 %

Kjetil Hjellegjerde

62 341

3,55 %

3,55 %

Håvard Valderhaug

55 424

3,16 %

3,16 %

Lars Sæther

52 297

2,98 %

2,98 %

Audun Krutvik

48 488

2,76 %

2,76 %

Bjørn Vanebo

48 488

2,76 %

2,76 %

Trond Langørgen

47 024

2,68 %

2,68 %

Ragnhild Sunde

44 617

2,54 %

2,54 %

Bjørn Vidar Remme

41 907

2,39 %

2,39 %

John Andre Tran

41 605

2,37 %

2,37 %

Morten Bremseth

41 561

2,37 %

2,37 %

Egil Gussiås, Styremedlem

32 366

1,84 %

1,84 %

Eirik Nesje

31 171

1,78 %

1,78 %

Anders Thern

29 638

1,69 %

1,69 %

1 264 226

72,03 %

72,03 %

490 525

27,95 %

27,97 %

1 754 751

100,00 %

100,00 %

PARENT COMPANY Ordinary shares

SHAREHOLDERS PER 31.12:

Total Other (less than 5% ownership) Total number of shares

MERIT GLOBE ANNUAL REPORT 2015

23

243 employees 9 countries 22 offices

www.meritglobe.com

NORWAY BERGEN GJØVIK MOLDE OSLO SANDNES TRONDHEIM ÅLESUND Phone: +47 400 03 650 E-mail: norway@meritglobe.com SWEDEN GÖTEBORG KALMAR LINKÖPING MALMÖ STOCKHOLM Tel.: +46 8 410 234 00 Phone: sweden@meritglobe.com FINLAND HELSINKI TURKU TAMPERE Phone: +358 290 091 040 E-mail: finland@meritglobe.com DENMARK ODENSE Phone: +45 42 14 91 20 E-mail: denmark@meritglobe.com

GERMANY LANDSHUT Phone: +49 176 832 799 44 E-Mail: germany@meritglobe.com SWITZERLAND BASEL ZUG Phone: +41 41 561 44 00 E-Mail: centraleurope@meritglobe.com CZECH BRNO Phone: +41 78 688 99 13 E-Mail: centraleurope@meritglobe.com ITALY Phone: +41 78 688 9912 E-Mail: centraleurope@meritglobe.com UK MANCHESTER Phone: +44 78 94 414026 E-mail: enquiries@meritglobe.com

Infor Business partner covering Great Britain, Ireland, the Netherlands, Belgium and Luxemburg.