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2016-10-25

Solteq: Solteq Plc Interim Report 1 January - 30 September 2016

The year of sowing the seeds and sprouting the new greenish crop of
international growth - focusing on omnichannel and digital commerce
continues

Brief look at January - September 2016

- Revenue totalled 45,3 million euros (33,9 million euros)

- Operating profit was 5.742 thousand euros (1.058 thousand euros).
The impact of the business divested in the first quarter on the
operating result was -212 thousand euros.

- Adjusted operating profit was 2.209 thousand euros (1.847 thousand
euros).

- Solteq Group's equity ratio was 32.4 % (27.1 %).

- Earnings per share was 0.26 euros (0,03 euros).

- In the review period, Solteq published the new strategy, in which
the key elements are digital commerce, growth and
internationalization.

- As part of its strategic focus on multi-channel and digital
commerce, Solteq decided to sell its subsidiary MainIoT Software Oy,
which supplied service and maintenance systems, in the first quarter
of the year. In the third quarter of the year, it decided to
establish a dedicated omnicommerce competence centre of excellence
that would serve Nordic retailers.

- During the third quarter of the year we won many new customer
projects in Finland as well as internationally.

After the review period, at the same time with the interim report, we
published that we have acquired the entire share capital of Swedish
Aponsa AB. The acquisition executes the strategy focusing on digital
commerce and international growth. A separate stock exchange bulletin
on the acquisition has been published on 25 October 2016. Related to
another discontinued acquisition an adjustment item totaling to 503
thousand euros is recognized during the review period.

Key figures and ratios

+---------------------+-----+-----+------+-----+-----+------+-----+-------+
| |7-9 /|7-9 /|Change|1-9 /|1-9 /|Change|1-12/|Rolling|
| | 2016| 2015| -%| 2016| 2015| -%| 2015| 12 m|
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Revenue, EUR million | 13,6| 14,9|-8,9 %| 45,3| 33,9|33,9 %| 54,2| 65,7|
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Adjusted operating | 0,6| 0,7| -17,2| 2,2| 1,8|19,6 %| 3,0| 3,4|
|profit, EUR million | | | %| | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Operating profit, EUR| 0,0| -0,1|-111,5| 5,7| 1,1| 442,7| 1,3| 6,0|
|million | | | %| | | %| | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Profit for the | -0,5| -0,4| 9,7 %| 4,4| 0,4| 900,9| 0,1| 4,1|
|financial period, EUR| | | | | | %| | |
|million | | | | | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Earnings/share, eur |-0,03|-0,03| 0,0 %| 0,26| 0,03| 766,7| 0,01| 0,25|
| | | | | | | %| | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Operating profit -% |0,1 %| -0,4| | 12,7|3,1 %| |2,4 %| 9,1 %|
| | | %| | %| | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Adjusted operating |4,4 %|4,9 %| |4,9 %|5,5 %| |5,5 %| 5,1 %|
|profit -% | | | | | | | | |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+
|Equity ratio, % | 32,4| 27,1| | 32,4| 27,1| | 24,4| 32,4 %|
| | %| %| | %| %| | %| |
+---------------------+-----+-----+------+-----+-----+------+-----+-------+

Repe Harmanen, CEO of Solteq: Strategic actions, new projects and
focus on the final spurt towards the end of the year

During the third quarter of the year, we won several new client
projects. We have released information on some of them, but the
contractual extent of others has not reached the limit set in our
stock exchange release policy. At the review period level, our
revenue grew as expected, and our operative profitability improved.
The slight decline in the revenue for the third quarter was partly
due to the changes that took place in the operating environments of
some of our long-term clients, but the rationalisation programmes and
more flexible cost structures have maintained and improved relative
profitability.

The key elements of our strategy are digital commerce, growth and
internationalisation. In the Nordic countries, we will focus on
solutions for chain-based and digital commerce. Globally, digital
commerce solutions will be in the core of our strategy. In Finland,
we will mainly grow organically, but in the Nordic countries and
globally, we also aim at being active in mergers and acquisitions to
implement our strategy.

From strategic point of view, our most significant client project was
the framework agreement with the Musti ja Mirri Group Oy concerning
the delivery of a retail business solution to the Finnish, Swedish
and Norwegian markets that we published in the review period. This is
an excellent example of the implementation of our strategy and its
goals. We will continue this work systematically and strengthen these
areas both geographically and operationally. At the same time, we
have also started collaboration with a few new digital commerce
clients in Europe.

At the end of the past quarter, a total of about 10 new top experts
joined Solteq and started to work in our key business areas in
Finland, Sweden and Poland. During the last few months of the year,
we will continue recruiting in these areas. The establishment and the
expansion of the Magento Omnicommerce Competence Center, which we
published some time ago, will also increase the number of employees
both in Finland and abroad.

A significant factor related to the third quarter is a non-recurring
cost item for a company acquisition project. However, we decided to
discontinue the process due to the risks involved. The risk of a
negative development was also too high in terms of the owner value.
At the same time with this interim report we published a release of
another, successful company acquisition.

The last quarter of the year will be full of activity, and our aim is
to successfully complete several concurrent digital commerce projects
with our clients. During the last few months of the year, we will
continue our investments in strategic areas in Finland, Sweden and
Poland. In this way, we will create growth for years to come.

We will maintain our earlier profit guidance concerning the revenue
and operating profit for 2016.

Guidance on Group outlook

Solteq Group's revenue is expected to grow significantly compared to
financial year 2015. The operating profit and the adjusted operating
profit are expected to grow compared to financial year 2015 as well.

The expected growth of revenue and operating profit is mainly related
to the M&A activity completed during the previous financial year and
during the review period. In addition, the cost synergies arising
from the M&A activity are expected to be realized mainly during the
year 2016.

Online-briefing for investors and media October 25th, 2016

The media and investor briefing for the announcement of financial
performance of the first three quarters of 2016 will be broadcasted
on Periscope October 25th, 2016 at 13.00 on channel @SolteqTweets.
The briefing will be recorded and can be accessed on the Solteq's
website later on the same day.

The online-briefing will also be broadcasted at the same time at
Solteq Facebook as live-video.

Briefing for investors and media November 16th, 2016

The media and investors are welcome to participate in a briefing on
Wednesday, November 16th at 8.30 at Allas SeaPool in Helsinki. The
briefing focuses on digital commerce and Solteq strategy. For
additional information please see
https://www.solteq.com/en/investors/investor-relations/ir-calendar/

Further information

Repe Harmanen, CEO
tel. +358 400 467 717
e-mail repe.harmanen@solteq.com

Antti Kärkkäinen, CFO
tel. +358 40 8444 393
e-mail antti.karkkainen@solteq.com

DISTRIBUTION

NASDAQ OMX Helsinki
Key media
www.solteq.com

Solteq in brief

Solteq is an expert in digital commerce. We deliver comprehensive
solutions for digital commerce under one roof: from back-office
processes to customer experience - from supply chain management to
online marketing. We have the passion to deliver the unexpected - in
a fast-changing world our customers need a partner who can deliver
today what they need tomorrow. We employ ca. 500 experts in three
different countries and we make deliveries to Europe, North America,
Asia and Australia.

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