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2018-09-03

Omnicar: New pricing, KPI follow up on Q2 report

Many investors have asked us about our new pricing structure and
whether it was a profit warning. Below I wish to address the reason
behind the pricing change.

In our previous business model, Omnicar's revenue was not determined
by the number of dealers and workshops on our solution but by the
number of contracts generated by Omnicar's customers. Our previous
business model was based on a 5% fee to Omnicar out of the contracts
our dealers were generating on our platform plus a small monthly fee.
Now, we operate with a fixed fee (the average fee is SEK 1,429
monthly). Even if we have 1,000 dealers and they generate 90
contracts on average after 12 months of a value of SEK 200, that is
still much less in the first two years compared to our new model
based on a fixed fee and 700 dealers. Consequently, our revenue
outlook is now much more precise and our target is actually higher
compared to our old model.

What we can see is that the workshops (not car dealers) do not perform
as fast as we want them to. In principle, we are selling too cheap
compared to the value we are generating and, consequently, we are in
a position where we can increase our pricing. OmniCar has found that
car dealers see the SAM solution as a must-have and they show a
willingness to pay a higher license fee compared to the current 5%
commission.

We have been addressing this market in less than one year and now we
have the insights to optimise our revenue numbers and now that we do
not depend on the dealers' performance, we are solely dependent on
our ability to sell our solution to the market.

KPI reporting

Some investors have asked why we did not disclose our KPI numbers.

The KPI transparency was based on our "old" business model, which was
hard to understand for many investors, mainly because so many factors
would influence our revenue (number of contracts, value, number of
dealers, length of contracts). With the new model, the only KPI is
the number of dealers and workshops that subscribe to our solution.
We currently have 471 dealers and workshops on our platform and our
target for 2018 is 700 with our new business model.

Contact Information
For more information about OmniCar Holding AB, please contact
Claus T. Hansen, CEO
E-mail: cth@omnicar.dk
Telephone: + 41 79 854 47 69
http://www.omnicar.com/
About OmniCar
The IT company OmniCar has developed a unique software solution called
SAM (Service Agreement Manager) for vehicle repair shops and car
dealers. SAM is a digital tool that is designed to automatically
manage future sales and service agreements. SAM helps vehicle repair
shops and car dealers to manage and sell far more service contracts
than before, using customized additional services and
subscription-based services that follow each car throughout its
lifecycle.

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http://news.cision.com/se/omnicar/r/new-pricing--kpi-follow-up-on-q2-rep...
http://mb.cision.com/Main/15800/2607175/902064.pdf

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