First-Quarter ARR Growth Accelerates to +142% Year on Year

1 JANUARY – 31 MARCH 2022

• Annual recurring revenue (ARR) amounted to SEK 115.8 (47.8) million, corresponding to an increase of 142 percent, of which 69 percent relates to organic growth and 73 percent acquired growth.
• Net sales amounted to SEK 24,599 (10,095) thousand, corresponding to an increase of 122 percent, of which 86 percent relates to organic growth and 36 percent acquired growth.
• EBITA amounted to SEK -22,429 (-7,575) thousand. Nonrecurring items affected EBITA with SEK 1,732 thousand which related to transaction costs in connection with the acquisition of Sumdog Ltd in February 2022.
• Profit before tax for the period amounted to SEK -25,182 (-7,603) thousand.
• Profit after tax for the period amounted to SEK -24,610 (-7,603) thousand.
• Earnings per share amounted to SEK -1.39* (-157.34), before and after dilution.
• Cash flow from operating activities amounted to SEK -24,958 (-9,458) thousand.
• Net cash (-) / debt (+) at the end of the period amounted to SEK -155,378 (-55,678) thousand.
• Cash and cash equivalents at the end of the period amount to SEK 155,378 (57,126) thousand.

*Earnings per share have been calculated for 2021 with the share split (250:1) registered on 25 August 2021.

SIGNIFICANT EVENTS DURING THE FIRST QUARTER 2022

• In February, an offer was launched for young people between the ages of 10 and 16 under the Albert Teen brand. The platform will contain extensive and curriculum-adapted content for subjects such as mathematics, physics and biology, and will also be rolled out in other markets as localization is completed.
• In February, Albert English was launched in all markets except the UK. The launch comes because of the great demand among customers and is aimed at children with English as a second language.
• In February, Sumdog Ltd was acquired for a total purchase price of TGBP 8,650, of which TGBP 2,000 refers to an additional purchase price linked to the company's development of ARR during 2022 - 2023. The acquisition expands the Group's offering to B2B segments. The acquisition is expected to contribute to annual net sales of SEK 31 million.

AFTER THE END OF THE PERIOD

• In April, the technical and operational integration of Jaramba, which was acquired in December 2021, was completed. Jaramba's platform, focusing on reading, arithmetic and learning games for children aged 1-5, is thus available to all Albert customers, which has increased the product offering.
• In April, Jonas Mårtensson was recruited as Chief Operating Officer with effect from 1 June 2022. Jonas will be part of the management team and responsible for the company's B2C operations.

FOUNDER’S COMMENT

We have entered 2022 with a focus on continuing to expand Albert's offering and market presence. Net sales amounted to SEK 24.6 million, corresponding to an increase of 122 percent compared with the first quarter last year. As of 18 April, the end of the quarter's Easter campaign, ARR amounted to SEK 130.7 million. ARR refers to the campaign that runs between January and Easter every year where new customers can test Albert for free. During the current quarter only a limited number of new paying subscribers were added, as they can’t be seen in the figures before they start being charged (which takes place after the end of the campaign). EBITA in the first quarter amounted to SEK - 22.4 million and reflects the mentioned campaign that took place throughout the period. We continue to prioritize growth, and during the quarter we both broadened the product range and completed a new acquisition.

In October last year, Albert was launched in the British market, which we consider to be one of the most important EdTech markets in Europe. The initial offer was aimed at the younger age category, but in February this year it was supplemented with a product aimed at young people between 10-16 years. Albert Teen contains curriculum-adapted subjects such as mathematics, physics, and biology, and is based on the IP rights related to Stairway Learning which was acquired in November 2021. It is a development that really shows the strength of acquiring good content that quickly can be integrated and launched to Albert customers. Albert Teen is a big step towards our ambition to have an equal offer in all markets, and we are now working to localize the content to other national curricula to be able to launch Teen in more markets in the future.

In addition to Albert Teen, we have also launched Albert English in all markets where English is a second language. We have noticed a strong demand for English as a subject on Albert's platform and have received a very good response from both parents and children immediately after launch. Albert English is available in Albert Junior, which thus contains the three most important core subjects for younger children in a single app; Mathematics, ABC, and English.

Perhaps the most important event of the quarter was the acquisition of Sumdog, a leading B2B player in EdTech with operations primarily in the United Kingdom. We have thus in one fell swoop expanded from only B2C to B2B. Sumdog's digital platform is currently used by around 15 per cent of all schools in the UK with curriculum-adapted content aimed at children aged 5–14 in subjects such as mathematics, spelling, and grammar. We see great opportunities to explore synergies between B2C and B2B, where we now have access to the three most important EdTech target audiences students, parents, and teachers. We believe that the expansion to B2B enables a business area with different characteristics compared to our B2C business area. This is because B2B excels in long annual contracts together with a low churn, which enables a stable business with clear synergies with our core business.

In parallel with all the above, our team throughout the quarter has also worked hard to integrate Jaramba, which was acquired just at the end of 2021 and whose content is primarily aimed at the age category 1–5 years. In mid-April, the project was completed and Jaramba's platform then became available to Albert's customers.

With that said - if we look back over the past four months - we have taken very big steps towards our long-term goal of becoming a leading player in the European EdTech market. We now have content that targets 1–16 years and have broadened our offering to B2B. At the same time, we feel that we are still only at the beginning of our journey. We continue to see good acquisition opportunities, while the conditions for organic growth are favourable. Expanding to new markets continues to be a priority, and we have several ongoing experiments that could result in broad launches of Albert's offering going forward.

Link to the report
The report is attached to this press release and is available at: https://investors.hejalbert.se/uk/reports

Presentation of the report
Today at 09.00 CET, founders Arta Mandegari and Salman Eskandari as well as CFO Martin Dahlgren will hold a presentation of the report via webcast. Link https://www.finwire.tv/webcast/albert/q1-2022/

For additional information, please contact:

Martin Dahlgren, Head of Finance
Mobile: +46 (0)73 909 26 31
Email: martin@hejalbert.se

About eEducation Albert AB (publ)

Albert is the children's digital teacher, who since the start in 2016 has helped over 275,000 families with homework via mobile devices. Albert's apps are aimed at younger (3-9 years) and older children (10-16 years) and include subjects such as Mathematics, Geography, Code and Reading & Writing. Albert was founded in 2016 by two friends in Gothenburg with a clear goal - to democratize knowledge through technology - and that is what drives us even today. Albert is listed on the Nasdaq First North Growth Market with the short name (ticker) ALBERT. The company's certified adviser is FNCA Sweden AB, info@fnca.se, +46 (0) 8528 00 399.
 
Read more at investors.hejalbert.se

This information is information that eEducation Albert is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 2022-05-02 07:30 CEST.

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