Acconeer : YEAR-END REPORT JANUARY-DECEMBER 2020

Q4-2020

YEAR-END REPORT JANUARY-DECEMBER 2020

FOURTH QUARTER

• • Net sales for the fourth quarter amounted to kSEK 2,956 (1,829) TSEK.

• • The Gross margin was 72 (67) %.

• • Result after taxes amounted to kSEK -15,451 (-19,465).

• • Earnings per share before and after dilution was SEK -0.66 (-1.01) SEK.

• • The cash flow from operating activities was kSEK -13,927 (-15,641).

FULL YEAR

• • Net sales for the full year amounted to kSEK 9,505 (5,508).

• • The Gross margin was 61 (61) %.

• • Result after taxes amounted to kSEK -62,312 (-68,539).

• • Earnings per share before and after dilution was SEK -2.85 (-3.58)

• • The cash flow from operating activities was kSEK -56,391 (-60,701).

• • Cash and cash equivalents including short term deposits at the balance date amounted to kSEK 82,170 (77,954)

SIGNIFICANT EVENTS DURING THE FOURTH QUARTER

• • Acconeer received two orders from Digi-Key worth USD 36,000 and 37,000.

• • A distribution agreement was signed with Marubun.

• • Acconeer received an order from BEYD worth USD 421,000.

• • It is the company's assessment that the effects of Covid-19 has had a limited impact on operations in 2020. No impact was seen on the development side, while manufacturing was somewhat affected by a global shortage of processors that occurred in connection with Covid-19. Regarding demand for the company's products, we see that some customer projects have been delayed, but the assessment is that this falls within the margin of uncertainty that always exists.

SIGNIFICANT EVENTS AFTER THE END OF THE PERIOD

• • Acconeer receives funding of SEK 4M for project on sleep monitoring with Sleepiz and University of Gothenburg.

COMMENTS FROM OUR CEO

In the fourth quarter 2020 we were happy to see seven new customer launches, including three in China which continues to be a strong market for us. Otherwise, continued focus has been to finalize the discussions with

Alps Alpine, where we hope to be able to sign a contract during Q1 2021.

In the second quarter we signed an MoU with Alps Alpine to share the development cost of thenext generation radar system. The agreement contributes up to approximately SEK 100 million to the development and is distributed as SEK 30 million in direct investment in Acconeer during the second quarter 2020 and an MoU of up to SEK 70 million contribution to the project. During the fourth quarter the technical discussions have continued together with

Alps Alpine to define the A2 product, supply chain and project plans, but we have not been able to conclude the commercial discussions. The fact that we have not been able to travel to meet face to face has slowed these somewhat complex discussions down. The relation between the two companies remains good, however we need more time to be able to finalize the contract. We expect payments to start in the second quarter of 2021. The product we develop together is planned to reach the market in 2023/2024.

Otherwise, also the fourth quarter 2020 has been dominated by the global outbreak of the Covid-19 virus. We have previously announced that we do not see any impact from Covid-19 on the development or purchasing side, but that we believe we will see delays in launches and new projects on the customer side due to Covid-19. New in the fourth quarter is a global shortage of processors, which affects our modules where we have not been able to ship all orders we have received. We expect continued problems with the purchasing of processors during the first half of 2021. The shortage of sensors has also had the effect that our customers have not been able to produce products in the expected pace. Despite this, our revenue grew in the fourth quarter compared to the third quarter, a development completely driven by China which is strong while we see a relatively weak development in both US and Europe.

The sale of evaluation kits gives an indication of the great interest that exists in our sensor and is an important indicator of the potential of future product launches. We can state that we sold 501 evaluation kits in the fourth quarter, which is better than our goal of selling more than three per day on average in 2020.

More than five EVK per day on average is a very strong number, and there is a one-time effect of the launch of our Entry module which has performed well in terms of sales. Since launch, we have now sold 3117 evaluation kits and for 2021 we will keep the goal to sell at least three EVK per day on average.

We have previously stated that based on our customer pipeline, we believe that we will be able to launch at least five new customer products per quarter. During the fourth quarter, we saw seven new customer launches and so far the total number of customer launches is 34. In the quarter three new parking sensors were launched, one each in China, Korea and Europe, along with three tank level measurement products, out which two were in Europe and one in China. Finally, one product for presence detection in office environment was launched in China. The area of presence detection in offices and other environments is an area where we see large potential, and we are happy to see our first launch in the area.

During the quarter, we presented another customer story, IoT Solutions from Malta which already in 2020 bought sensors in large volumes. For a more detailed compilation of launched products, see the table below.

Sales to these customers are reflected in our sales to

Digi-Key and other distributors.

2021 is a new year with new challenges and goals, and hopefully a year where we can put Covid-19 behind and go back to a more normal way of working. We will focus on:

• • Continue to launch new customers and help existing customers grow.

• • Focus on customers with high volume potential and support them in launching their products.

• • Deepen the collaboration with Alps Alpine and receive more design wins together with them.

• • Invest in the development of new more advanced applications such as gesture control, breathing frequency and speed measurement.

• • Start designing the next generation radar sensor, A2, which will be a very strong complement to A1 and which will already from the start cover the specific requirements of the automotive industry.

Our goal is to continue, in cooperation with our network of distributors, to in a controlled way take advantage of all growth opportunities that emerge to establish a leading position in low-power radar.

Lund, February 19, 2021

Lars Lindell, CEO of Acconeer AB (publ)

FOURTH QUARTER NET SALES AND RESULT

As of Q1 2020, the company has transitioned to a functional income statement. Comparative periods have been recalculated.

Net sales for the fourth quarter amounted to kSEK 2,956 (1,829) , ie an increase of 62% compared with the previous year. Net sales relate to sales to customers through the distributors Digi-Key, BEYD and Codico and other new distributors.

Gross profit, which only includes direct cost of goods, amounted to kSEK 2,121 (1,222) which corresponds to a gross margin of 72% (67%).Product mix between our sensors, modules and evaluation kits and changes in exchange rate affects the gross margin.

FULL YEAR IN SUMMARY

Net sales for the full year amounted to kSEK 9,505 (5,508), ie an increase of 73% compared with the previous year. Net sales relate to sales to customers through the distributors Digi-Key, BEYD and Codico and other new distributors.

Gross profit, which only includes direct cost of goods, amounted to kSEK 5,756 (3,379) which corresponds to a gross margin of 61% (61%). Product mix between our sensors, modules and evaluation kits and changes in exchange rate affects the gross margin.

Compared to the full year last year, operating expenses decreased by 3% to kSEK 71,814 (74,070). The decrease is mainly related to reduced otherCompared to the fourth quarter of last year, operating expenses decreased by 14% to kSEK 18,406 (21,294). The decrease mainly refers to reduced consulting costs in research and development. Depreciation of capitalized development costs, patents and equipment was made during the fourth quarter with kSEK 2,982 (2,890) TSEK.

Operating profit for the fourth quarter amounted to kSEK -15,451 (-19,465) and the profit after tax was kSEK -15,451 (-19,465).

The average number of employees during the period was 38 (35), of which 5 (4) were women.

external costs and an increase in other operating income.

Depreciation of capitalized development costs, patents and equipment was made during the full year with kSEK 11,775 (11,525).

Operating profit for the full year amounted to kSEK -62,309 (-68,562) and the profit after tax was kSEK -62,312 (-68,539). The improved result compared with the corresponding period last year is mainly due to reduced administration costs and increased other operating income.

CUSTOMER LAUNCHES BY MARKET AND AREA OF USE

IoT Parking sensors

IoT Smart presenceIoT Wasteman-agement

Industry Level gauge

Robotics Object detection

Other

Total

South Korea 4 4

1

1

4 11

2 2

1 1

1 1

4

3 14

Taiwan 1 1

5

1

8

2

The table refers to the accumulated number of customer launches since product launch Q2 2018.

1 34

INVESTMENTS, LIQUIDITY AND FINANCIAL POSITION

On 31 December 2020 the cumulative book value of balanced costs for development work amounted to kSEK 25,246 (34,427). This refers to development work related to the A1 product. No capitalization has occurred during the year since product commercialization is now underway.

The corresponding patent portfolio value amounted to kSEK 1,824 (1,740) most of which is due to investments in patents and patent applications related to the A1 product. Acconeer has 8 patent families including in total 22 granted patents and 9 pending patent applications. The patent portfolio covers various geographic regions, including the U.S., Europe, Japan and China.

Investments in fixed tangible assets and patents

has been financed from the company's own resources, and amounted to kSEK 1,694 (526).

The Group is small and not covered by requirements for consolidated accounts, therefore no Group Accounts has been prepared.

The cash flow from operating activities during the nine months period amounted to kSEK -50,800 (-56,859).

After changes in working capital the cashflow for the period was kSEK -56,391 (-60,701) .

At the balance sheet date, cash and cash equivalents amounted to kSEK 82,170 (77,954).

Total equity amounted to kSEK 120,492 (120,179).

Equity ratio was 94 (92) percent.

SIGNIFICANT EVENTS DURING THE YEAR

JANUARI-MARCH

In february Acconeer received an order from Glyn Limited worth USD 12,800. The order relates to Acconeer's radar sensor A1. The same month Acconeer received an order from Digi-Key worth USD 15,100. The order relates to Acconeer's XM122 IoT Module.

At the end of february Acconeer received an order from CODICO worth USD 62,700. The order relates to Acconeer's A1 radar sensor for a European customer.

It was announced that in february, 24 months after the company started selling Evaluation Kits

(EVKs) at Digi-Key, Acconeer AB had shipped more than 100,000 A1 radar sensors to distributors and customers.

In March Acconeer received an order from a European customer worth USD 14,700. The order relates to Acconeer's A1 radar sensor, for production of the customer's IoT solution.

In the middle of March the company announced that they are planning to develop an integration-ready entry module with low system cost. The entry module, XM132, was released during the third quarter of 2020.

Acconeer announced at the end of March that the company was awarded three design wins by Alps Alpine for presence detection in cars to a European premium car manufacturer. Acconeer estimates the total potential value of the design wins to US$ 9-12 million over three years starting in 2022. By "design win" Acconeer refers to that the company's radar sensor has been selected for use in a customer product, but it is not equivalent to that an order has been placed.

APRIL-JUNE

In April Acconeer received an order from Digi-Key worth USD 29,500. The order related to the XM112 High Performance Module and related connector board and lens kit.

On April 24 the company announced that they had entered into a non-binding Memorandum of Understanding (the "MoU") of a joint development agreement to develop next generation patented Pulse Coherent sensors.The MoU prescribes that Alps Alpine will contribute up to USD 7 million towards the development of the product and that Alps Alpine will, on commercial terms, receive exclusivity for the new product for the automotive market. The product is planned to be ready for production during 2023.

On May 4 Acconeer announced its intention to carry out a directed new share issue of approximately SEK 60 million to Swedish and international institutional investors. Alps Alpine Co., Ltd., undertook to subscribe for shares corresponding to a maximum of USD 3 million in the directed new share issue. Later that day, it was announced that the Board of Acconeer AB, had with support of the authorization granted by the annual general meeting 14 April 2020, resolved on and carried out a new share issue of 4,062,000 shares. The subscription price of the shares in the directed new share issue was SEK 16 per share. Through the directed new share issue Acconeer received proceeds amounting to approximately SEK 65 million before deduction of transaction costs. The directed new share issue was subscribed for by Alps Alpine Co., Ltd. and a number of institutional investors.

In May it was also announced that Acconeer has