Seamless Distribution AB (publ) Annual Report 2016

STOCKHOLM, Mar 15, 2017

A Few Words From the Chairman

2016 continued to build on the strong current trend underway for Seamless. All of our business divisions reported improved net revenues which resulted in total group revenues growing by 27% compared with 2015.

Our business area Seamless Distribution Systems (SDS) increased sales by 6% to 96 MSEK and net earnings increased by 22% to 33.1 MSEK, compared with 2015. The favorable development of the company continues with new additions to our product portfolio combined with a strong order pipeline in our traditional product mix.

Several important developments took place during the year in the Seqr business. One of the most notable developments is that Seqr users can now pay with Seqr all over the world, wherever NFC enabled (contactless) card terminals exist. The development of this new technology meant that our acceptance network went from a few tens of thousands of stores to approximately 35 million Point-Of-Sales (POS) overnight. This development also removed Seqr's largest bottleneck which has been our limited acceptance network, and also means that Seqr doesn't have to continue to negotiate bilateral agreements with merchants in order to grow its acceptance network. If you, as a merchant, accept MasterCard, you accept Seqr.

Seqr also acquired the Norwegian company MeaWallet. MEA is a software company which has developed turn-key solutions for card issuers wanting to issue virtual cards through a mobile device. This is strategically important technology as we believe that in the future every existing and new card issuer in the world will embrace virtual card issuance through various mobile electronic devices. Currently, there are only a limited number of companies that can offer this technology, which gives a MEA (and by extension, Seamless) a favorable competitive environment.

2017 promises to be a very exciting year in which the technology and market trends would appear to support strong growth for this year and the future.