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2015-08-17

M-Brain Oy: M-Brain Oy Semi-Annual Report January 1 - June 30, 2015 (unaudited)

M-Brain Oy Semi-Annual Report 17.8.2015 01:00 pm

M-BRAIN OY SEMI-ANNUAL REPORT January 1 - June 30, 2015 (unaudited)

January - June 2015:

* Revenue EUR 15,478 (January 1 - June 30, 2014: 9,502) thousand - increase
62.9% from the corresponding period last year.
* EBITDA was EUR 1,437 (January 1 - June 30, 2014: 895) thousand - increase
60.5% from the corresponding period last year.
* Balance sheet total as of June 30, 2015 EUR 34,711 (as of June 30, 2014:
32,901) thousand.

The main figures (unaudited)

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| M-Brain Group (IFRS) |
| 1000 EUR 1-6.2015 1-6.2014 1-12.2014 |
| Revenue 15 478 9 502 23 518 |
| EBITDA 1 437 895 922 |
| EBITDA % of revenue 9.3 % 9.4 % 3.9 % |
| Operating profit 778 516 -26 |
| Operating profit % of revenue 5.0 % 5.4 % -0.1 % |
| Profit (loss) for the period 189 301 -769 |
| Profit (loss) for the period % of revenue 1.2 % 3.2 % -3.3 % |
| Balance sheet total 34 711 32 901 35 330 |
| Revenue of own equity, % 1.6 % 2.9 % -7.9 % |
| Equity ratio, % 36.4 % 41.6 % 35.1 % |
| Number of personnel (FTE) 398 298 345 |
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MANAGING DIRECTOR SIRPA OJALA'S COMMENTS

M-Brain is a global information, technology and consulting services company
with offices in 12 countries. We help our clients to navigate the turbulent
and ever expanding business environment. We offer crucial external business
information, and advice in its efficient management and utilization. We turn
information into actionable insights for daily decision-making and strategic
planning. We call it Informed Leadership.

The first half-year period of 2015 has been a time of strong integration for
M-Brain. Combining M-Brain's and Global Intelligence Alliance Group's, which
was acquired in the fall of 2014, operations and their further development
have helped M-Brain to achieve a positive and market position strengthening
growth with a significant expansion of the product portfolio and market area.
Packaging services into Monitoring, Intelligence and Advisory segments has
further developed the positive customer experience and M-Brain's position as
our customers' business and market intelligence partner.

REVENUE AND RESULT DEVELOPMENT

In the first half-year period of 2015, the revenue of M-Brain Group was EUR
15,478 thousand. The operating profit was EUR 778 thousand.

The cuts regarding overlapping functions and production streamlining measures
carried out during the previous financial year significantly lowered the cost
level during the review period. The Finnish market remained challenging due
to the general economic situation and the decline in the traditional business
caused by the media revolution in Finland.

M-Brain's EBITDA was EUR 1,437 thousand (January 1 - June 30, 2014: 895) i.e.
9.3% of the net sales (9.4%). EBITDA of the review period includes
approximately EUR 525 thousand of non-recurring costs. The GIA Group
acquisition significantly improved the overall growth of the revenue and the
result. The figures of GIA Group are consolidated into M-Brain Group as of
September 2014.

The depreciations for the review period were EUR 659 thousand and operating
profit EUR 778 thousand (January 1 - June 30, 2014: depreciations 380 and
operating profit 516).

The Company's Finnish subsidiary Global Intelligence Alliance Group Oy merged
with its sister company M-Brain Insight Oy on June 30, 2015.

FINANCING AND INVESTMENTS

On June 25, 2014, M-Brain listed a bond on First North Bond Market Finland
market place. The EUR 15 million unsecured bond is subject to a fixed
interest rate of 8 percent and its due date is June 17, 2017. M-Brain has,
with a purchase agreement signed 4 September, 2014, acquired the whole share
capital of Global Intelligence Alliance Group Oy (GIA) mainly using the funds
received from the bond.

M-Brain's investments, EUR 387 thousand, are mainly related to the internal
product development. The intangible assets resulting from the internal
development activities will be recognized in the balance sheet once the
expenses of the development phase can be calculated reliably, once the
completion of the product can be implemented technically, once the Group can
use or sell the product, once the Group can prove how the product will
generate likely future financial benefit, and once the Group has both the
intention and the resources to complete the development work and to sell the
product. After initial recognition, capitalized development costs are
measured at cost less accumulated depreciation/amortization and impairment
losses. Depreciation/amortization is recognized from the date the asset is
ready for use.

PERSONNEL, MANAGEMENT AND ADMINISTRATION

The average number of personnel in the Group during the review period was 398
full-time employees (January 1 - June 30, 2014: 298).

Kim Nyberg (Chairman of the Board), Marjukka Nyberg, Petri Laine, Robert
Ingman, Pirjo Ståhle, Tage Lindberg and Matti Rusanen were members of the
Board of Directors of the Company from the beginning of the review period. On
June 30, 2014 the Annual General Meeting of the Company re-elected Kim
Nyberg, Marjukka Nyberg, Petri Laine, Robert Ingman, Tage Lindberg and Matti
Rusanen as members of the Board of Directors.

Kimmo Valtonen was Managing Director of the parent company until March 16,
2015 and from that date onwards Sirpa Ojala.

M-Brain Oy's auditor is Deloitte&Touche Oy, principal auditor Authorized
Public Accountant Hannu Mattila. The Group's Finnish subsidiaries have the
same auditor.

GENERAL MEETINGS

The Annual General Meeting of the Company was held on June 30, 2015. The
Annual General Meeting decided on the adoption of the financial statements
and the discharge of liability to the members of the Board of Directors and
the CEO. The Annual General Meeting decided that the result for the fiscal
year January 1 - December 31, 2014 be recorded in the profit and loss account
and that no dividends be distributed. The Annual General Meeting decided that
no change be made to the fees of the members of the Board of Directors. The
fee of the Board members is EUR 1,200 per month.

SHARES

On June 30, 2015, the Company had 23,593 registered shares. On June 30, 2015,
the Company had a total of nine shareholders. The Company owns 100 of its own
shares.

Significant events after the reVIEW period

The Company has not had any significant events after the review period.

Major risks and uncertainties

Technological development in the Company's field of business is extremely
fast. In accordance with its strategy, the Company has made significant
investments in its own product development to improve its competitiveness
compared to its competitors.

The core operations of the Group are insured against accidental damages and
interruptions.

Accounts receivables is significant balance sheet item. Credit risk related to
accounts receivables is managed by consistent credit policy and efficient
credit management. Credit risk is also reduced by the large number of clients
and by the fact that the receivables are allocated to a number of different
industries.

The Group's loan financing involves covenants agreed with the lenders to which
the Company is committed. Fulfillment of the covenants with regard to the key
figures will be reviewed for the first time on December 31, 2015.

OUTLOOK FOR THE YEAR 2015

The revenue for year 2015 is estimated to be approximately EUR 32-36 million
and EBITDA approximately EUR 3.3-5.3 million, including non-recurring
expenses of approximately EUR 0.7 million relating mainly to the integration
of Global Intelligence Alliance Group. These non-recurring items as well as
weaker than previously expected revenue development explain the reduced
outlook.

Previously in the financial statements published on March 31, 2015, the
Company estimated that revenue for year 2015 would be approximately EUR 33-37
million and EBITDA approximately EUR 4-7 million.

The Company's business involves various risks and uncertainties, and the
statements in this release, other than statements of historical facts, are
forward looking statements. These statements are based on the management's
best judgment and belief in light of the information currently available to
it. As such statements involve risks and uncertainties, the actual results
may differ materially from those we expect at the moment.

FINANCIAL INFORMATION

Financial statements for 2015 will be published on March 4, 2016.

DETAILED FINANCIAL INFORMATOIN

This unaudited Semi-Annual Report has been prepared in accordance with IFRS
recognition and measurement principles. The Report has been prepared applying
the same principles as in the IFRS consolidated financial statements for the
year 2014 except the amendments regarding the new IFRS standards entered into
force and put into operation on January 1, 2015. These amendments have not
had a material effect on the Semi-Annual Report.

The preparation of the consolidated financial statements in accordance with
the IFRS requires the use of estimations and assumptions of management which
effects the reported assets and liabilities as well as the income and
expenses in the balance sheet. Although these estimations are based on
management's best current knowledge, it is possible that the actual results
may differ from these estimates and assumptions.

All figures are presented in thousands of euros and have been rounded to the
nearest 0.1 thousand euros, as a consequence of which the sum of individual
figures may deviate from the presented sum.

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| CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME (IFRS) |
| (unaudited) |
| 000 EUR 1.1.-30.6.2015 1.1.-30.6.2014 1.1.-31.12.2014 |
| |

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