Arcario : Interim Report Q1 2023

Quarterly Report Q1

JANUARY - MARCH 2023

Arcario AB

556668-3933

INTRODUCTION

Improved Gross Margin and EBITDA:

A Springboard for Accelerated Growth

" Our transformation into Arcario and K33 has set us on a promising trajectory.

We are poised for growth, primed for innovation, and prepared for the opportunities ahead. Our portfolio potential is substantial and brimming with possibilities. We're presently assessing several prospects aligned with our strategic trajectory, eagerly embracing the possibilities of the web3 space [...] As the digital assets industry continues to grow, Arcario is not only well- positioned to participate but to also shape the evolution of the industry as a key player. Further, with new initiatives and strategies such as our incubation program and 'double-down' strategy, we are set to accelerate growth and solidify our position in the industry.

- Michael Jackson, Chair of Arcario

" The first quarter for K33 was one of strategic reformation as we prioritized

the enhancement of our core services, leading to promising returns and a substantial increase in the subscription base for K33 Pro Research users, even before the highly anticipated launch of our improved Research application [...] As we look forward, the potential for K33's newly developed market application is considerable. Coupled with our consistent fund performance and the successful launch of the K33 Vinter quality index, we are well- positioned for rapid scalability and eager to share our successes with you, our shareholders, in this compelling digital universe.

- Torbjørn Bull Jenssen, CEO of Arcario & K33

Arcario AB | Quarterly Report | Q1 2023 January - March

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INTRODUCTION

First quarter of 2023

Compared to first quarter 2022

• Group revenue decreased to 38,607 kSEK (105,865)
• EBITDA amounted to -6,951 kSEK (-2,124)
• EBIT amounted to -11,372 kSEK (-8,835)
• The result for the period amounted to -25,188 kSEK (-10,178)
• Earnings per share before dilution amounted to SEK -0.003(-0.001)
• Earnings per share after dilution amounted to SEK -0.003(-0.001)

	Financial overview
	Q1	Q4	Q1	Full year
	Financial overview
	kSEK	2023	2022	2022	2022
	Revenue	38,607	45,032	105,865	287,838
	Operating expenses	-45,558	-58,797	-107,990	-331,668
	EBITDA	-6,951	-13,765	-2,124	-43,830
	Adjusted EBITDA	-6,951	-10,046	-2,124	-32,930
	Total assets	88,100	100,051	174,812	100,051
	Total liabilities	32,807	28,812	35,368	28,812
	Equity	55,293	71,239	139,444	71,239

Revenue by quarter kSEK

Arcario AB | Quarterly Report | Q1 2023 January - March

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MAIN EVENTS

Main Events

Main events during Q1 2023

• On February 16th, Arcario's K33 subsidiary announced the release of the K33 Vinter Quality
  Index. The reference index is broadly available on financial platforms like Bloomberg and Refinitivi with assessment reports available on the K33 platform.
• On February 23rd, Arcario announced that it had entered into a convertible loan agreement with COWA to facilitate discussions regarding a strategic M&A transaction.
• On February 28th, Arcario released the interim report for Q4 and full year 2022.
• On March 2nd, an EGM decided to change to the name from Arcane Crypto to Arcario

After the end of the period

• On April 17th, the Global Launch of the K33 platform was announced.
• On April 19th, it was announced that Kristian Kierkegaard leaves the board.
• On April 21st, it was announced that Arcario's portfolio company, LN Markets, achieved an all time high trading volume in Q1 2023 of 1,850 BTC.
• On April 27th, Arcario's K33 subsidiary announced a partnership with Ondato to deliver compliance and security services for the K33 Markets application.
• On May 3rd, Arcario's portfolio company Pure Digital announced a partnership with Nomura backed ClearToken for Centralised Clearing House Integration.
• On May 9th, it was announced that the Arcario's Annual General Meeting will be held on June 9th.
• On May 19th, Arcario's annual report for 2022 was published.
• On May 22nd, Arcario and COWA announced a strategic partnership focused on web3 innovation and collaborative ventures.
• On June 8th, Arcario's K33 subsidiary announced the upcoming beta testing of the K33 Markets application.

Arcario AB | Quarterly Report | Q1 2023 January - March

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Commentary

Michael Jackson

Chair of Arcario

Dear Shareholders,

We have successfully navigated a transformational period for our organization. During last year and the first quarter this year, we went through a strategic reorganization, splitting the old Arcane Crypto into two entities, Arcario and K33. This restructuring was not simply a superficial renaming exercise, but a deep-seated shift to optimize our strategic positioning and an elevation of our operational capacity. Going forward, Arcario will have a single focus on continuing to build a great portfolio of web3-related investments. K33 on the other hand, will leverage its many years of experience under different brands, and bring to market the leading wealth management platform for digital assets.

Through the exploitation of our core competencies and a concentration on essential growth sectors, Arcario and K33 have emerged stronger, more adaptable businesses, primed to face future challenges and seize prospective opportunities.

Our portfolio potential is substantial and brimming with possibilities. We have been experiencing robust deal flow, and we're presently assessing several prospects that are aligned with our strategic trajectory. We are eager to disclose more details about these promising explorations in due time.

Subsequent to the restructuring, Arcario is also embarking on several innovative initiatives and strategies. We are designing an incubation program specifically aimed at fostering startups and accelerating their growth, complemented by our 'doubledown' strategy, enabling us to channel our investments towards the most promising, high-performing ventures over the long haul.

We are proactively embracing the possibilities of the web3 space, and the digital assets industry continuing to grow, Arcario is not only well-positioned to participate but to also shape the evolution of the industry as a key player.

Looking at our current portfolio, LN Markets continues to excel, consistently setting new records and breaking new ground. By leveraging the Bitcoin Lightning Network to enable a trust minimized trading experience, where funds are kept on exchange only as collateral while a position is open, LN Markets is not only pushing the technology front for Bitcoin, but building the foundational structures for a more robust digital assets market place in general.

Pure Digital is another highlight, demonstrating substantial progress and showing real promise. The increasing interest from

tier 1 banks and our recent partnership with the Nomura/Laser-backed ClearToken attests to igital's potential and strengthens our foothold in the industry.

Moreover, our mining operation, Green Data, is currently reaping significant benefits fr	y prices in
Northern Norway, which have even dropped to negative levels at times. After a firs	erage prices,
we anticipate an increase in margins as energy prices begin to decline.
In addition to this, our recent strategic alliance with COWA enables us to explor
collaboration on mining, web3 venture investments, and asset management with
financial support from our major shareholders and robust operational performance a
about the future.
In conclusion, our transformation into Arcario and K33 has set us on a promising trajectory. W
for innovation, and prepared for the opportunities ahead. As the Chair of Arcario, I am more
potential of this team, and I eagerly anticipate sharing our strategic investments and plan
Thank you for your unwavering trust and continued support. Your faith in us strengt
propels us to deliver stellar results.

Arcario AB | Quarterly Report | Q1 2023 January - March

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