Tradedoubler : Annual report 2021

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The information in the annual reportContents

Tradedoubler AB (publ), 556575-7423, is a Swedish public limited liability company with its registered office in Stockholm. The company is subject to Swedish laws and as a listed company is obliged to comply with NASDAQ Stockholm's rules and regulations which govern information disclosure to the market.

All values are stated in Swedish kronor. Kronor expressed in millions is abbreviated to SEK M and kronor expressed in thousands is abbreviated to SEK '000. Numerical data in brackets refers to 2020 unless otherwise stated. Information about markets and the competitive situation is Tradedoubler's own assessment, unless a specific source is provided. You can subscribe to press releases and financial reports on Tradedoubler's website.

The Annual Report is prepared in Swedish and translated into English. Should differences occur between the Swedish Annual Report and the English translation, the Swedish version shall prevail.

BOARD OF DIRECTORS' REPORT 4

SUSTAINABILITY REPORT 6

RISKS AND UNCERTAINTY FACTORS 7

CORPORATE GOVERNANCE 8

FINANCIAL INFORMATION

CONSOLIDATED ACCOUNTS 14

NOTES TO THE CONSOLIDATED ACCOUNTS 18

PARENT COMPANY ACCOUNTS 36

NOTES TO THE PARENT COMPANY ACCOUNTS 40

BOARD AND CEO'S SIGNATURES 46

AUDITOR´S REPORT 47

BOARD OF DIRECTORS 52

COMPANY MANAGEMENT 53

ALTERNATIVE PERFORMANCE MEASUREMENTS 54

A print version of the annual report may be ordered from:

Tradedoubler AB

Regeringsgatan 29

SE-111 53 Stockholm

Tel. [phone]

E-mail:[e-mail]

5 year summary

Overall financial comments

SEK M

Total revenue Gross profit Gross margin, %

Operating costs, excl. depreciation1, 2

EBITDA adjusted for change related items2

Change related items

EBITDA2

• 1 Adjusted for change related items.

  2021

  2020

  2019

  1,421 277 19.5

  1,235 255 20.6

  1,209 264 21.9

  -212

  -191

  -212

  67

  64

  -6 61

  -2 62

• 2 2018 and earlier periods has not been adjusted for IFRS 16.

• 2018 2017

• 1,173 1,173

• 264 260

• 22.5 22.2

• -222 -239

  -7 45

  52

• 42 22 -3 2 39 23

Financial calendar

Annual General Meeting

Interim report January-March 2022

Interim report January-June 2022

Interim report January-September 2022

Year-end report 2022

18 May 2022

18 May 2022

21 July 2022

3 November 2022

10 February 2023

The group's total revenue during 2021 amounted to

SEK 1,421 M (1,235). This was an increase of 15 per cent or a change of 18 per cent adjusted for changes in exchange rates compared to 2020.

Gross profit amounted to SEK 277 M (255), which was an increase of 10 per cent or an increase of 13 per cent adjusted for changes in exchange rates.

EBITDA amounted to SEK 61 M (62).

Investments, mainly related to activated development expenses, amounted to SEK 30 M (24).

Operating profit (EBIT) amounted to SEK 28 M (25).

The sum of cash and interest-bearing financial assets at the end of 2021 amounted to SEK 94 M (89). Net cash was

SEK 1 M (-30).

Earnings per share, before and after dilution, amounted to SEK 0.53 (0.16).

The Board proposes that no dividend should be declared for 2021 (SEK 0 per share). No dividend was paid for 2020.

BOARD OF DIRECTORS' REPORT

Board of directors' report

The board of directors and the chief executive officer of Tradedoubler AB (publ), corporate registration number 556575-7423, hereby submit the annual accounts for the operations in the parent company and the group for the financial year 2021.

TRADEDOUBLERS OPERATIONS

Tradedoubler is an international leader in performance-based digital marketing and technology powering a unique network of connections. The company works with over 2,000 advertisers through its network of 180,000 publishers in over 80 coun-tries. In 2021, Tradedoubler generated SEK 37 bn incremental revenue for its clients through e-commerce and m-commerce.

Tradedoubler's business strategy

Tradedoubler operates within the dynamic environment of digital and mobile commerce, which is characterised by positive trends in both consumer and advertising expenditure. The digi- tal marketing sector in Europe and worldwide is very dynamic.

Channels such as social media, video and mobile continue to expand their market share and advertising is increasingly traded on an automated basis. This dynamic is influencing our business and, together with advances in technology, opens a range of new opportunities for our clients and us.

For advertisers and publishers who want to grow their business Tradedoubler offers performance marketing and technology solutions powering a unique network of connections. Combining over 20 years of digital marketing innovation and expertise and global presence Tradedoubler offer tailored performance solu- tions based on our clients' needs. Our market-leading integrated technology platform tracks online customer journeys. It creates data-driven insight that helps us deliver targeted performance advertising across multiple, high-quality digital channels:

• • Industry-leading affiliate marketing network: Affiliate market-ing is a risk-free solution for advertisers looking to increase sales or leads as they only pay for results.

• • White-label partner management platform: Our award-winning technology platform allows advertisers, publishers or agencies to manage partnerships directly themselves or setup and run their own private affiliate network.

• • Campaign management: We offer performance-based campaigns tailored to our client's needs and based on programmatic and non-programmatic inventory. From lead generation to display, native advertisement, video and app install.

• • Market-leading business intelligence: Data-driven insights including user journey reporting and analysis to optimise digital ad spend for the best return across all channels.

Building and growing relations is our lifeblood and our key expertise for more than 20 years. 264 employees based in 14 offices connect advertisers and publishers in more than 80 countries around the globe to grow their business.

SIGNIFICANT EVENTS DURING THE YEAR

In 2016 Tradedoubler acquired a minority stake in DynAdmic for a total amount of EUR 1,2 M. In June 2021 these shares were

4

Tradedoubler Annual Report 2021

sold to Smart, a leading independent French adtech platform, for a total potential amount of EUR 2 M. Around EUR 1.75 M were received in July 2021 as an upfront payment and a earnout of EUR 0.25 M depends on future results of the company. The divestment of shares increased the results by SEK 9.3 M, where of SEK 2.7 M is the estimated result of the earn-out.

TRADEDOUBLER'S CURRENT POSITION

In 2021, Tradedoubler has made significant progress in its operations and for the first time in a long time has shown double-digit growth in both sales and gross profit. Covid-19 has continued to affect operations in 2021, but not to the same extent as last year. The travel segment, which was initially hit very hard during the pandemic, had real growth during the fourth quarter of 2021 and almost doubled its revenues compared with the same period last year.

GROUP RESULTS

If not explicitly stated, the disclosed financial information refers to reported numbers not adjusted for change related items nor changes in exchange rates. For comparability reasons and to indicate the underlying performance, Tradedoubler adjust for change related items. For more information, see page 6.

Consolidated total revenue during 2021 were SEK 1,421 M (1,235), which was an increase of 15 per cent or 18 per cent adjusted for changes in exchange rates.

Gross profit for the year amounted to SEK 277 M (255). Gross profit adjusted for change related items during the year was SEK 279 M (255) an increase of 10% or 13% adjusted for changes in exchange rates. Gross margin amounted to 19.5% (20.6). The main reason for the decrease in gross margin is driven by larger clients with lower margins than the average client.

Operating costs excluding depreciation and change related items during the year was SEK 212 M (191), an increase of 11% or 13% adjusted for changes in exchange rates.

Operating profit before depreciation and amortisation (EBITDA) during the year amounted to

SEK 61 M (62). Adjusted for change related items, EBITDA was SEK 67 M (64).

Depreciation and amortisation were SEK 33 M (37), the decrease is mainly related to a write-down of approximately SEK 3 M in 2020, which was related to an internal R&D project.

Operating profit thus amounted to SEK 28 (25) M in 2021.

CASH FLOW AND FINANCIAL POSITION

Cash flow from operating activities before changes in working capital, referring to EBITDA reduced by paid taxes, paid interest and non-cash items amounted to SEK 40 M (40) during the year.

Changes in working capital were SEK 15 M (49).

BOARD OF DIRECTORS' REPORT

Net investments in tangible and intangible assets during the year mainly related to product development amounted to SEK -30 M (-25). Cash flow amounted to SEK 2 M (35).

The sale of Dynadmic has affected cash flow during 2021 by a total of SEK 17.7 M. The cash-flow during 2021 has also been impacted by an early amortization of one of the loans from the company's principal owner Reworld Media. The early amortiza- tion impacted the cash flow by SEK -16 M, and accumulated interest related to this part of the loan was paid and impacted the cash flow by SEK -1.3 M.

Cash and cash equivalents at the end of the year amounted to SEK 94 M (89). Interest-bearing liabilities amounted to SEK 93 M (118) and relates to the loan agreements with Reworld Media S.A. During the year SEK 28 M of the loan has been amortized. Net cash hence amounted to SEK 1 M (-30) at the end of the year.

Consolidated shareholders' equity amounted to SEK 261 M (226) at the end of the year and the equity/asset ratio was 28.3 per cent (27.0). The return on equity during the rolling 12 months ending December 2021 was 9.7 per cent (3.1).

EMPLOYEES

On December 31, 2021, Tradedoubler's staff corresponded to 264 (242) full-time equivalents (FTE) and included permanent and temporary employees as well as consultants.

CHANGE RELATED ITEMS

For comparability reasons and to indicate the underlying perfor- mance, Tradedoubler adjusts for change related items. The following items affect the comparability in this report.

Change related items in the year 2021 amounted to SEK -6,3 M, where SEK -3,3 M related to costs linked to Reworld Media's share program to key management personnel which is described on page 10 in the Annual report 2020. SEK -2,2 M relates to a decrease in revenue due to first indications from the Swedish Agency for Economic and Regional Growth, that they will reclaim the grants contributed in 2020 for the short working hour scheme. The amount was confirmed and repaid in 2022.

SEK -0.7 M is costs related to a breach of an agreement related to office costs, and severance payment over multiple segments.

Change related items in the year 2020 amounted to SEK -2 M and related to costs linked to Reworld Media's share program to key management personnel.

For more information, see Note C25.

SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

The post-reporting period has been marked by Russia's aggres- sion against Ukraine. The war has so far had very little effect on Tradedoubler's operations. It is too early to say how the business will be affected in the long run. Depending on the course of events, it is not unreasonable to assume that the company will be affected in any way, either directly or indirectly through its customers.

Apart from this, no significant events have occurred since the end of the reporting period..

THE PARENT COMPANY

The parent company's total revenue amounted to SEK 106 M (88) during 2021. Revenue primarily consisted of internal licens-ing revenue to subsidiaries.

Operating profit (EBIT) amounted to SEK 14 M (9) during 2021.

Net financial items amounted to SEK -20 M (7). Dividends from group companies were SEK 4 M (5) and changes in exchange rates have impacted pre-tax profit in 2021 with SEK -4 M (6). During the fourth quarter of 2021, a write-down of shares in subsidiaries was made, which affected earnings by SEK 25 M. Profit after tax amounted to SEK -6 M (9) during 2021.

The parent company's receivables from group companies amounted to SEK 178 M (147) at end of 2021, of which none (0) were non-current. The parent company's liabilities to group companies were SEK 98 M (87), of which none (0) were non- current. Cash and cash equivalents amounted to SEK 45 M (41) at the end of 2021.

Deferred tax assets amounted to SEK 0,1 M (0,1) at the end of 2021. No capitalisation of deferred tax on loss has been made

Total revenue (SEK M)

Gross margin (%)EBITDA (SEK M)

EBITDA/Gross profit (%)

Excluding change related items

SEKSMEK M 15010500

1,4211,421

25%25%SEKSMEK M 70 70

67 67

28%28%

60 60

50 50

40 40

30 30

20 20

10 10

0 0

20127017

20128018

20129019

20220020

20221021

20127017

20128018

20129019

20220020

20221021

Tradedoubler Annual Report 2021

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