Annual Report 2014 About EVRY

Annual report 2014 About EVRY

EVRY is one of the leading IT companies in the Nordic countries, with a strong local and regional presence in 50 Nordic towns and cities. Through its knowledge, solutions and technology, EVRY contributes to the development of the information society of the future, and so creates value for the benefit of its customers and for society as a whole. EVRY combines in-depth industry knowledge and technological expertise with a local delivery model and international strength. Contents

Introduction 4

Letter from the CEO 4

Strategy 6

Our business 8

EVRY Norway 9

EVRY Sweden 12

EVRY Financial Services 15

Corporate Social Resposibility 18

Key figures 20

From the Boardroom 24

Executive Management 24

The Board of Directors 26

Corporate Governance 28

Report from the Board of Directors 2014 36

Statement by the Board of Directors and CEO 46

Annual accounts and notes 48

Annual Accounts Group 50

Annual Accounts EVRY ASA 96

Auditor's report 106 4 Introduction

EVRY's strategy for Nordic leadership

According to the World Economic Forum, ICT is the most important driver for economic growth, and the Nordic countries are at the top of the list for adopting new technology. EVRY has a key role to play in this. 2014 saw the start of a strategic process to drive EVRY towards its objective of being a leading supplier of innovative IT services in the Nordic market.

EVRY plays an important role in society as a whole through A proactive company the scale and significance of the services it provides to Nordic Following the merger of ErgoGroup and EDB in 2010, EVRY business and industry and to public sector entities in the cen- announced a strategy for Nordic leadership with three tral government, local government and health sectors. Every phases. Successful integration and growth were the main day more than 4 million people in the Nordic countries make objectives for the first two phases. The third phase of the use of EVRY's solutions. strategy is to create a more proactive company that is able to make even better use of all the opportunities for profitable In the years ahead, technology will play an ever more import- growth that the IT industry offers. ant role in economic growth and improving welfare in the Nordic countries. This will create significant growth opportu- In August 2014, EVRY announced that the Board of Directors nities for the IT industry, while at the same time globalisation and executive management had decided to start a process of the industry will continue. EVRY is extremely well-posi- to evaluate various strategic alternatives for delivering the tioned in attractive segments of the Nordic market. third phase of its strategy, including a possible sale of the company. The main shareholders at the time, Norway Post EVRY has a long history of being a driving force in the devel- and Telenor, fully supported this process. A structured opment of the Norwegian and Nordic IT industry. From the process was carried out over the course of autumn 2014 sound basis of its long-term commitment to the developing to evaluate strategic alternatives for EVRY. This process its business along industrial lines, EVRY has built up a signif- resulted in a takeover bid for EVRY by Apax Partners, which icant position in the Nordic IT services market, particularly was announced on 8 December 2014. The Board of Directors in Norway and Sweden. EVRY's strong position is founded on unanimously recommended acceptance of the offer, and the its extensive solutions portfolio and its unique local network, main shareholders confirmed that they accepted the offer. combined with important involvement in global sourcing. In addition to its local and regional presence in 50 Nordic Closer to the customer towns and cities, EVRY has a sizeable international delivery EVRY's new main shareholder has expressed its full sup- apparatus for Global Sourcing in India, Ukraine and Latvia. port for the company's strategy. EVRY's objective is to be a EVRY is recognised as a sound company with the potential supplier and collaboration partner that goes even further to to continue its growth path and build an even stronger and understand every customer's business and future require- more visible position in the IT services market. ments. We will set ambitious targets for what we can achieve Introduction 5

for our customers, and we will help them to realise the bene- supplier in markets where demand is high and our closeness fits of digitalisation. This makes it necessary to accelerate the to customers in the form of business understanding and local implementation of the existing strategy and put even more presence represents an important competitive advantage. emphasis on resources in areas where we are already strong. This approach includes the continuing development of our EVRY intends to continue to play a leading role in the solutions portfolio for the banking and finance industry. development of the Nordic IT services market through its In addition, we will strengthen our focus on other selected innovation and continual renewal. In support of this, EVRY industry verticals and maintain a strong regional presence. will invest in its business and will also consider acquisi- This will give us greater business insight, strengthen our tions where this is consistent with its strategy for profitable understanding of customers' requirements and ensure that growth. We are committed to working every single day to our deliveries are more reliable and deliver even better value. deliver added value for our customers and investors. Only by EVRY is currently in the process of launching new cloud- doing this can we achieve our ambition of Nordic leadership. based services for the next generation of IT operating services with a greater degree of automation and self-service. This is what we call 'Future Proof', and we are confident that this concept will improve EVRY's competitiveness in a globally competitive marketplace.

Creating value for our customers and investors Over the course of 2014, EVRY took new and important Björn Ivroth strategic steps to adapt and specialise its products and CEO EVRY services for selected industry verticals. In parallel with this, steps were taken to strengthen our solutions expertise in the most sought-after areas of new technology. We also strengthened our local presence in selected locations by allocating the responsibility for developing some solutions areas and delivery models to our regional technical centres. The main objective of this strategy is to ensure that EVRY is a preferred 6 Introduction

Adding value through customer insight

While developing digital solutions and digital business models puts organisations to the test, it also creates entirely new opportunities. EVRY’s objective is to be a collaboration partner that helps its customers realise these opportunities. More than ever before, this requires us to have a clear insight and a sound understanding of our customers’ activities.

Many of our customers are between the old and the new. of these areas. The limits are not set by the technologies Their existing solutions need to be operated and managed themselves, but by the ability to adapt them in a way that in a reliable and cost-effective way, while new opportuni- is efficient and adds value. Understanding each customer's ties offer fertile ground for growth, increased productivity, business model, work processes, organisation and ‘soft improved services and greater customer satisfaction. elements’ such as organisational culture is essential to achieving this. If we are to be a trusted supplier that chal- The technological opportunity space is continually ex- lenges its customers’ business models and work processes, panding, but having more opportunities also brings greater we have to be able to identify what the pinch points are complexity. If we are to deliver our customer promise – We and where improvements and changes can be made. In the bring information to life, creating value for our customers, bank and finance area, EVRY has a strong history and has to the benefit of society – there are two particularly import- always worked to develop its expertise in a targeted way. ant elements that we must deliver: We are similarly focused in our other industry verticals. We are building up our expertise and are also recruiting experts Contribute to the transformational journey: Our solutions who have a lot of industry experience. We are prioritising and consulting advice must be anchored by an understand- those areas where we already have a strong presence, and ing of the customer’s business challenges and opportunities, our aim is for our insight to be a competitive advantage and and must support the customer’s transformational journey. a source of support for customers as they face the need to implement significant changes. Life cycle commitment: A complete IT services portfolio must help customers with their IT development at every Closeness to customers phase of the IT life cycle - from planning and development EVRY has a decentralised structure, with 50 offices in through to implementation and production. the Nordic region. As well as strengthening our focus on customer insight, EVRY will follow a strategy in which a Customer insight and closeness to customers are common regional and local presence will continue to be an import- components to both these elements. ant and differentiating part of our service offering. In an increasingly globalised market, EVRY’s geographical and Customer insight cultural closeness to its customers means it is in a better Big Data, Mobility, Cloud Services and Social Media stand position to understand its customers’ requirements and out as four key trends in the development of information therefore to deliver value-adding services with a high de- technology. The question is not whether but how our cus- gree of precision and trusted commitment. tomers can use the opportunities created by one or more Introduction 7

Customer satisfaction Customer value EVRY has a strong position in Norway and Sweden, and has The digitalisation of public and private sector organisa- a clear ambition to achieve Nordic leadership in the market tions is continuing unabated. This will provide EVRY with for IT services. If we are to achieve our goal, we need to many opportunities in the years ahead. At the same time, accelerate our growth rate by increasing our competitive the competition is fierce and the competitive landscape is ability. A number of measures targeting organic growth complex. Just like our customers, we at EVRY need to be have been implemented. Strengthening our industry know able to adapt our business model and our service concepts to ledge and our local presence are central components in this. the new technological developments that affect us. One area Other important components include a high level of opera- that has represented a challenge for us is offering robust, tional quality, first-class customer service, and competitive flexible and scalable solutions for IT operating services. We end-to-end solutions. have therefore developed a cloud-based operating service with an emphasis on security, standardisation, automation EVRY achieved an aggregate customer satisfaction score and a high degree of self-service. The service, called Future of 73 points in 2014, which is a 3-point increase from the Proof, will provide customers with computing capacity on previous year. The most important variables behind this competitive terms using a variable cost model. Future Proof were EVRY’s improved operational quality and the great- therefore meets many of our customers’ needs for com- er degree of customer insight brought about by the focus puting capacity that can vary in response to their business on industry verticals. This shows how different aspects volumes. of EVRY’s strategy work together to ensure the solutions we offer are competitive and add value for our customers. EVRY’s ambition is for its customer insight and closeness to While we are satisfied with the direction we are moving in customers to enable it to develop and deliver services and and the progress we are making, some of the feedback we solutions concepts that meet new, future requirements and receive from customers indicates that there is significant help customers to realise the opportunities that digitalis- improvement potential in some individual areas. We assign ing services and processes can provide. EVRY will seek to the highest priority to this work. Our ability to grow further prioritise those areas where the conditions for profitable depends on satisfied customers and deliveries that add growth are the most favourable. EVRY will work hard and value. In addition to progressing its initiatives for organic in a targeted way to ensure all its deliveries add value for its growth, EVRY will also consider acquisition opportunities customers. Only in this way will we add value to EVRY and that complement its growth ambition. achieve our ambition for Nordic leadership. 8 Our business 9

EVRY Norway

EVRY Norway reports operating revenue of NOK 6,093 million in 2014. The segment is a major supplier to both private sector companies and the public sector. In addition, EVRY Norway has a strong regional delivery structure that serves 21 towns and cities across the country. EVRY Norway has a total market share of about 30%.

The EVRY Norway segment generated the same level of organic We serve our clients locally through dedicated teams of staff operating revenue in 2014 as in 2013. The segment was nega- who know the opportunities and challenges that businesses tively influenced by a reduction in the revenue associated with in their local area face. EVRY's geographical proximity, along providing applications management services to Norway Post. with local decision-making, enables us to adapt and change At the same time, the segment saw positive growth in a range quickly to meet customers' requirements. In parallel with this, of areas, including in regional operating services. our regional units utilize the strengths that the entire EVRY organisation can provide whenever this is appropriate. In order to ensure the segment is better positioned for profitable growth, EVRY implemented some organisational changes EVRY is investing heavily in developing standardised con- at the start of 2014. We chose to simplify EVRY Norway by cepts and packaged services that it can offer to all its cus- dividing the various business areas into Regions Norway and tomers. Examples of this include Smart, Client as a Service Industries Norway. and Fieldworks, which are market-adapted solutions that we have pooled our best expertise to build and that can be imple- EVRY Norway completed the first phase of its new industri- mented quickly regardless of geographical location. alised and automated operating concept Future Proof during the autumn of 2014. Preparations for the move to EVRY's Regions Norway has almost 1,100 employees working at its new data centre in Fet are in full swing, and EVRY expects 16 regional offices. to migrate the first customers at Easter 2015. The centre was developed in collaboration with DigiPlex. EVRY will offer envi- Industries Norway ronmentally friendly and secure cloud services with safe data EVRY offers complete industry-specific solutions that operate storage in Norway. Future Proof is built on industrialised solu- across various individual specialist areas. The combination of tions from leading technology suppliers and combines a high industry knowledge and robust IT expertise ensures successful degree of automation with a global sourcing delivery model. deliveries to customers in a range of industries and sectors.

The EVRY Norway segment also includes the group’s Global Private sector Sourcing activities. The group has decided to run down and EVRY focuses on a range of different private sector industries, close the SAP-related consulting activities in Denmark that including insurance, energy, the automotive industry and are part of EVRY Norway. The EVRY Norway segment has various other industry areas. Two of EVRY’s large customers, 3,344 employees in Norway and 3,103 employees in the Norway Post and Telenor, are also included in this area. Our Global Sourcing activities in Ukraine, Latvia and India (at aim is to provide these customer groups with a broad range 31 December 2014). of IT services based on market-leading technology. We seek to make our customers more competitive by using informa- Regions Norway tion technology to drive financial growth through enhanced The greatest strength we gain from our solid regional structure efficiency, renewal and innovation. is that we are close to our customers. The SMB segment has shown strong growth in recent years, and it is characteristic of this market that customers want access to comprehensive and cost-effective IT services. 10 Our business

Insurance customers using both physical and digital channels. Retail cus- The insurance industry is one of EVRY’s focus areas, and we tomers want to be able to choose between shopping in physical deliver consultancy services, solutions and operating ser- stores or in online shops, and to shop from mobile devices. vices to leading insurers such as Gjensidige, Storebrand, KLP, Customers also expect to be able to access real-time informa- Frende, Troll, Nordea Liv and Gabler. EVRY entered into an tion immediately, regardless of whether they are looking for updated partner agreement with UNIT4 in 2014, and EVRY is information on prices, special offers, products or services. now an Agresso preferred partner for customers in the bank Customers such as ISS, Schibsted, Bertel O. Steen and Toyota and insurance industry. EVRY is a market-leading provider of are creating competitive advantage by working with EVRY. Agresso to the public sector, where it has over 20 years' experience and almost 200 consultants who specialise in this area, Public sector and this expertise will be of great value for its partnership with The public sector has a clear and ambitious digital agenda bank and finance customers. designed to modernise, simplify and improve how the public sector is run and the services it offers. EVRY Norway has Energy accordingly identified the public sector as a key area of focus, EVRY delivers services to both energy generating companies specifically the market segments of municipalities, national and distributors. The need to develop infrastructure and to government and healthcare. Our vision is to deliver profitable automate services, for example solutions for automatic meter and innovative projects that contribute to digitalising and reading, is contributing to increased levels of activity in this increasing the efficiency of the Norwegian public sector. part of Norwegian industry. EVRY has a strong team and works with new and innovative partners, and is consequently National government well-positioned to take part in this growth. EVRY’s customers As a highly-experienced company that has a broad range of in the energy industry include Statkraft, Statnett, Lyse and expertise, EVRY is helping to realise the national government’s Skagerak Energi. aim of digitalising the public sector. We provide operationally-critical solutions to the Norwegian Tax Directorate, GIEK Industrial customers (Guarantee Institute for Export Credit), the Norwegian Public EVRY has delivered solutions and services to all parts of Roads Administration, the Ministry of Justice, the Norwegian Norwegian manufacturing and process industries for 40 years, Water Resources and Energy Directorate, the Norwegian and continues to help companies to be more innovative and Parliament, the Norwegian Directorate of Immigration, and to achieve a faster pace of change and higher productivity. As Statsbygg (public sector construction and property man- industrial production becomes ever more globalised, the need agement agency). Customers in the National Government for efficient logistics intensifies, and EVRY provides a range of market segment also include state companies such as NSB, solutions that deliver competitive advantages in this critical Vinmonopolet and Norsk Tipping. area. EVRY’s industrial customers include flagship Norwegian companies such as Norsk Hydro, Jotun and Orkla Municipal sector EVRY is a market leader in the municipal sector and helps most Oil and gas industry of Norway’s municipalities and county authorities to develop Our aim for the oil and gas industry is to create added value by better services and to automate and standardise their existing delivering technology and consultancy services that strength- solutions as well as to improve communication with the pop- en customers’ ability to compete and to adapt in accordance ulation. The majority of Norway’s municipalities manage their with fluctuations in demand and in the price of oil. Users in operationally critical processes using the Agresso ERP system this sector expect the IT systems they work with to be reliable together with the ePhorte and ESA case and archive solutions and user-friendly while at the same time offering a wide range supplied by EVRY. of functionality, not least so they are able to interact effectively across locations and technical disciplines. Health Specialist expertise is very important in the healthcare sector. Our specialist oil and gas industry team is located in Stavanger, EVRY has a strong team of healthcare sector professionals and from there they work closely with the teams in Porsgrunn, who contribute to our vision for future-oriented healthcare Bergen and the rest of the country. solutions: “by clinicians for clinicians”. We continuously develop innovative solutions for better healthcare, includ- Retail ing an electronic patient record solution for several of the Our retail and services customers are exposed to intense country’s health authorities as well as a solution for electronic competition, and EVRY accordingly focuses on providing risk assessment meetings, which was launched last year. Our efficient solutions to customers, suppliers and partners. At customers include the Directorate of Health, the Southern EVRY, we have defined service-providing companies and and Eastern Norway Regional Health Authority, the Northern the media industry as belonging to our specialist Retail area. Norway Regional Health Authority and several regional Retailers typically find it more difficult thaner ev before to hospitals. win and retain customer loyalty, and they need to serve their Our business 11

Highlights of 2014

• EVRY entered into a strategic agreement with the new mobile solutions for NSB drivers and ticket Norwegian Agency for Public Management and inspectors that will make their work simpler and in- eGovernment (Difi). The agreement will see EVRY teracting with customers a more accurate process. The operate ID-Porten/MinID, which are log-in solutions old backpacks and the 10-15 kilos of documents they used by 3.6 million Norwegians for public service, for contained everyday can now be abandoned for good. eight years. The agreement represents total contract value of approximately NOK 100 million over a four • PetroPortalen was launched, a tool that provides the year period. oil industry with simple, secure and cost-effective access to leading and standardised applications and ser- • The Northern Norway Regional Health Authority vice software. The solution is based on cloud techno awarded EVRY a group contract for an electronic logy and is characterised by flexibility and scalability. medication and patient record solution for all the health authority’s hospitals. The solution will contrib- • EVRY Regions Norway set up a new operating services ute to increased patient safety by dramatically reduc- unit and a new consulting services unit in Bergen, ing the risk of medication errors and adverse events. which will have specialist knowledge in infrastructure The agreement represents total contract value of NOK services as well as in cloud services. This investment 90 million and runs for six years. secures 50 jobs at EVRY, and the strategy involves plans for strong growth in the region. This will also lead to • EVRY entered into new framework agreements with new employees being recruited in Bergen by 2017. the Norwegian Tax Administration for UNIX and Backup, which together have a total contract value of • We continued to take market share in the market for IT NOK 40 million over a period of four years. operating services to SMBs, with new customers such as Skagerak Energi, NOAH, Bergene Holm, Stamina • Brønnøy municipality chose EVRY as a full-service Group and Saint-Gobain Ecophon. This shows that we supplier as part of its ICT collaboration with surround- are in a strong position and have satisfied customers in ing municipalities. The contract represents a new this fast-growing market segment. trend in the procurement and delivery of ICT solutions whereby full-service orientation is carried out • EVRY entered into an agreement with the Norwegian at the time of initial purchase. This means that there Digital Learning Arena (NDLA) that will see EVRY is greater focus on delivering functions and services operate the digital portal that provides all second- rather than on purchasing servers and other equip- ary school pupils with access to NDLA’s web-based ment, as was once the case. learning materials. NDLA is owned by Norway’s county authorities (with the exception of Oslo). The • EVRY has the largest specialist mobility team in the agreement with EVRY represents total contract value Nordic region with more than 150 technical specialists of NOK 5 million over four years and includes hosting and over 400 employees working on mobility projects. and operating a dedicated cloud service. We won several important contracts in 2014, including 12 Our business

EVRY Sweden

EVRY Sweden reports organic growth in operating revenue of 4% to NOK 3,472 million for 2014, and so continues to win market share. The Swedish IT market was affected by weak economic conditions in 2014. Despite this, EVRY Sweden closed 2014 with a strong market position as the fourth largest IT services supplier to the Swedish market, and reported organic growth in operating revenue.

Economic conditions gradually improved over the year. Weak industry-specific and business expertise with in-depth demand from the Eurozone was offset by growth in domestic expertise in relevant technology. The industry verticals deliver demand, which raises the prospect of continued moderate a broad range of services covering consulting, solutions and IT growth in the time ahead. The EVRY Sweden segment is operating services. well-positioned for continued growth. Our strongest competitive advantage is our ability to make use of our strong local The sectors and industries in which we operate include knowledge and presence, combined with the group’s inter forestry, the public sector and retail. In addition to the national resources for systems development. industry verticals, EVRY has extensive expertise in a number of specialist areas. One of these areas is mobility. The EVRY Sweden operates in the areas of consulting services, technology relating to mobility can deliver very significant outsourcing, applications solutions and operating services. The commercial benefits. Our objective is to create seamless and EVRY Sweden segment’s order backlog at 31 December 2014 competitive mobility solutions for our customers that support was NOK 2.2 billion, which represents a slight decrease from their business strategies and requirements. the same time last year. EVRY Sweden has 2,219 employees in total (at 31 December 2014). EVRY also offers lifecycle management solutions that handle everything from procurement and logistics through to Regions distribution, management of IT assets and support. Lifecycle In the same way as in Norway, EVRY Sweden has a unique management of IT assets helps to improve efficiency and regional position, and offers everything from strategic advice reduce costs for the customer, and this gives EVRY a unique and consulting services through to complete solutions and IT position in the market. Our industry and specialist teams have operating services. Accordingly, we continue to strengthen around 350 employees. and develop our local profile and distinctive business model designed for our regional locations. EVRY Sweden operates IT operating services from regional offices in 28 towns and cities, with delivery EVRY offers a range of solutions for IT operations. EVRY offers the capacity to serve small and medium-sized customers, as well benefits of local delivery of IT operating services combined with as large customers, throughout Sweden. the economies of scale of offshore sourcing. National Outsourcing Services currently has around 325 employees. We see strong Our objective for the regional offices is for EVRY to provide a demand from both current and potential customers for an oper- service that can take over complete responsibility for custom- ating services partner with industry-specific expertise relevant ers’ investment in IT through the entire process from identi- to the local market that also has the ability to deliver services that fying requirements to following up the outcome. The regional are competitive in terms of both price and quality. offer includes EVRY One, which brings together EVRY’s total services offer for small and medium-size businesses. This We have a broad range of expertise in delivering business-critical represents a comprehensive offer of technology, which helps services, including IT operating services related to servers, data customers to resolve all their IT challenges. storage, applications operations, IT workstations, Service Desk and network operations involving communication. The regional structure is the largest part of EVRY's Swedish activities, with around 1,300 employees. EVRY is currently Healthcare sector the largest supplier of IT services for small and medium-sized EVRY has extensive experience and unique expertise in the companies in Sweden. healthcare and welfare sector. EVRY offers integrated services that support both healthcare and welfare bodies and their Industry verticals and specialist areas patients. The Healthcare industry vertical has around 125 Our customers want to use a supplier that understands their employees involved in the offer of IT services for the healthcare business. EVRY meets their expectations with industry-specific sector, who apply their in-depth expertise in health and wel- solutions and services in addition to in-depth knowledge of fare services to create added value for customers. We develop, selected specialist IT areas. EVRY Sweden's industry verti- integrate, implement and manage systems for customers by cals represent a sizeable portfolio of solutions that combine delivering unified and effective services. Our business 13

Important contracts in 2014

• EVRY signed a new, comprehensive operating ser- • EVRY's contract to provide Service Desk services to the vices contract with the Swedish eHealth Agency. The Swedish Tax Agency was extended for a further two contract will see EVRY take responsibility for operating years. Service Desk is operated for the Swedish Tax the Agency’s IT system, which plays a crucial role in Agency from EVRY’s office in Örebro, which provides Swedish society and is responsible, for example, for the Swedish Tax Agency’s employees with support and digital prescription processing. The new contract runs service on IT matters. for a period of four years and includes the option to extend for a further four. The initial contract value is • EVRY signed a new multi-year contract with UC AB, estimated to be approximately SEK 69 million. Sweden’s leading business and credit reference agency. The contract is based on full-service delivery, and will • EVRY again won the trust of the Confederation of see EVRY take complete responsibility for internal IT Swedish Enterprise, this time for a period of three years support at UC in relation to workstations, including with the option to extend for a further three. The new Service Desk, a file storage service, membership and contract aims to give the Confederation of Swedish catalogue services, as well as email and telephony. Enterprise and its member organisations a full-service The new contract runs for a period of three years and delivery that will enable them to focus more on their includes the option to extend for a further two. The own core activities. EVRY is taking complete responsi- agreement represents initial contract value of approxi- bility for delivering IT support to workstations as well mately SEK 10 million. as networks, server operations and Service Desk. The agreement represents initial contract value of approxi- • EVRY signed a new multi-year outsourcing contract mately SEK 100 million. with ROL Ergo AB, a company that specialises in designing and producing height-adjustable desks. • EVRY signed a strategically important operating The new contract is for EVRY to deliver IT operations, services contract with the Swedish part of a large infrastructure, Service Desk and IT environment international defense group. EVRY is taking overall monitoring, as well as to operate and provide support responsibility for delivering standardised capacity ser- in relation to the IFS Applications business system. The vices, applications operations, Service Desk, infrastruc- contract runs for a period of three years and represents ture-as-a-service as well as IT workstations for around total contract value of approximately SEK 6 million. 1,500 users. The new contract runs for a period of three years and includes the option to extend for a further • EVRY is taking over running Sjöbo municipality’s IT two. The agreement represents initial contract value of system, including its IT department’s employees. The approximately SEK 120 million. contract initially runs for a period of three years and includes the option to extend for up to five years. The • EVRY signed a new contract with Stockholm Public initial contract value is estimated to be approximately Transport (Storstockholms Lokaltrafik, SL). The new SEK 10 million. Sjöbo municipality expects that out- contract includes support, maintenance, development sourcing its IT operations will give it access to a more and other services in relation to SL’s in-house devel- cost-efficient and flexible IT environment. Following oped traffic information system. The contract runs for a competitive tendering, the municipality will benefit period of three years and includes the option to extend from access to resources, qualitative processes, a high for up to a further four. The total contract value of the level of expertise and good service. The contract is also extended contract period is estimated to be between intended to improve the municipality's ability to use SEK 15-25 million, depending on development needs. state-of-the-art IT services to satisfy the requirements of both residents and visitors for its services. 14 Our business Our business 15

EVRY Financial Services

EVRY Financial Services is the Nordic region's leading supplier of IT solutions for the bank and finance market. EVRY's revenue from this segment increased by 3% in 2014. The Nordic market is expected to continue to grow. In addition, EVRY sees significant opportunities outside the Nordic region, especially in the areas of card services, lending solutions and ATM services.

EVRY Financial Services is a complete industry vertical Customer behaviour with responsibility for all the group’s deliveries to bank and Recent years have seen radical changes in the behaviour of finance customers, and offers delivery models structured to the banking sector's customers. Banks are seeing a continu- meet differing customer requirements. The segment offers ous increase in the number of customers using mobile bank- a broad and comprehensive portfolio of solutions to sup- ing and demanding more sophisticated and user-friendly port banks in their management of continuous change and services. In order to meet customers' future needs, banks to facilitate the next generation of banking services. EVRY have to adapt and simplify their products, processes and Financial Services is committed to sizeable investment in their infrastructure. This also involves reducing the complex- continuous development of an innovative and cost-effective ity of their IT environment. Banking customers expect 24/7 solutions portfolio. The solutions portfolio includes solutions access to their accounts, and the scale of interaction between for all core banking services, whether this relates to inter- a bank and its customers is increasing all the time. faces with end-customers or solutions to support a bank’s internal processes and employees. More and more bank customers also expect to access financial advice regardless of when they make contact or where An important element in the segment's strategy is to further they are located. In order to meet customers' expectations, expand and strengthen its geographic footprint in the Nordic banks need to go much further in creating a more cohesive market. In certain selected areas, such as card services, fraud customer experience regardless of the interface and channel prevention, lending solutions and ATM services, we will also the customer uses. This is all about making it much easier for continue to expand outside the Nordic region. customers to be in contact with their bank.

IT is particularly important in the bank and finance market, Trust and customer satisfaction are very important for banks. and plays a key role in helping banks to realise their strat- Banks will accordingly continue to invest in building custom- egy to make customer experience a competitive factor. The er relationships, and this involves developing user-friendly objective of making banking even more easy and accessible solutions on their customers' terms. to customers demands innovative solutions with an emphasis on self-service, automation and rationalisation. Operational EVRY Financial Services has 1,457 employees in the Nordic reliability and high levels of security are fundamental re- countries, providing in-depth customer understanding and quirements for deliveries to the bank and finance segment. awareness of the opportunities and challenges that charac- terise the bank and finance market. EVRY Financial Services Increased competition and new regulatory requirements for operates a delivery model that is fully integrated with the the bank and finance market make it even more important company's global sourcing units in order to deliver greater for banks to achieve continuous improvement in their profit- cost efficiency and speedy time-to-market. ability and efficiency. 16 Our business

Quality and continuous improvement Network (BIAN), in which EVRY, so far, is the only Nordic EVRY is committed to a focused and systematic program of member. EVRY's new solutions are module-based and are work to ensure continuous improvement in the quality and built according to the relevant industry standards and re- reliability of its deliveries and production of services. This quirements and architecture principles, including ISO 20022, commitment is reflected in documented improvements in Service Oriented Architecture (SOA) and BIAN. This ensures quality over the course of the year. We have strengthened that EVRY's solutions are flexible, cost-effective and ready for our infrastructure, value chains, organisation and corporate use in international markets. culture in order to ensure that work on improving quality becomes ever more proactive. Our objective is to continue Lending and financing to improve quality standards by working towards clearly EVRY has developed a solution for internet-based lending defined targets. that allows customers to submit loan applications simply and easily over the internet. This frees up time for the bank's Card Services lending officers so that they can work more effectively The card services segment of the market is growing strongly. and proactively with customers. EVRY offers a portfolio of EVRY is a leading vendor of card services and provides its services that cover the entire lending cycle from the loan services to the bank and finance industry as well as other application and credit approval through to loan administra- sectors such as retailers, transport services and other busi- tion, with services designed to meet the differing require- nesses. Accordingly, EVRY offers the market's most complete ments of the retail and corporate markets. range of services. Contactless card solutions and mobile payment services are important areas of focus, and the division Security is well-positioned for the growth expected in these areas in Bank customers must have absolute confidence in the secu- future years. rity of banking services. Therefore, security issues related to identity, digital signatures, card usage and fraud are top EVRY's acquisition of TAG System Finland OY reinforced its priorities for banks. EVRY Financial Services offers services commitment to the card services area, and this acquisition covering all security areas. has helped to strengthen the division's market position. The announcement that a major Nordic banking group has Card use is increasing sharply and card fraud is a constant decided to sign a comprehensive agreement for card services problem. Meeting this threat requires better cooperation from EVRY for all the Nordic countries served to confirm between the participants in the card services value chain this market position. EVRY Financial Services now supplies and the official authorities. As part of this, EVRY maintains around 25 million cards annually for more than 100 card issu- an active dialogue with the official authorities involved in ers in 12 countries. security issues, and there are several forums where security experts exchange and discuss operational measures to Next generation core banking solutions combat fraud. Banks need to take an aggressive approach to addressing the banking market of the future. EVRY recognises that it EVRY's centre for the prevention of card fraud makes use is crucially important to offer both bank customers and of shared experience, analytical data, logic and specialist employees solutions that deliver user-friendly banking methodology to reduce the incidence of fraudulent use of services as well as state-of-the-art functionality. Investing cards issued by our bank and finance customers. EVRY mon- in next-generation core banking and payment solutions is itors in excess over one billion card transactions around the therefore of great strategic significance. EVRY's develop- world - 24/7 - to detect and prevent fraud. Combined with ment strategy and implementation methodology in this area real-time monitoring, these measures have reduced banks' are firmly anchored in industry requirements through its losses from card fraud by 40-70%. close collaboration with the Banking Industry Architecture Our business 17

Important contracts in 2014

EVRY Financial Services had an order backlog of NOK 8.7 quick, and easy to use. The agreement represents total billion at the close of 2014. A number of contracts were contract value of NOK 800 million. EVRY will provide signed with Norwegian and Nordic banks over the course next generation core banking and payment solutions of the year, representing both new customers and renew- to Sparebanken Vest. In addition, EVRY will work als of contracts with existing customers. Some examples: as a partner with Sparebanken Vest on its program to renew and strengthen further its focus on digital • The SpareBank 1 Alliance signed a comprehensive banking services. agreement with EVRY for the purchase of IT services. The agreement represents total contract value of ap- • DNB: EVRY agreed a new contract structure with DNB. proximately NOK 2.0 billion over a four-year period, The new contract includes services for the bank's with an option to extend for a further 2+2 years. The mainframe core systems, and runs for five years. contract includes delivery of next-generation core bank and payment solutions. The solutions are fully • EVRY and Danish BEC signed a five-year agreement for adapted for international markets, and satisfy market delivery of systems and services for 450 ATMs owned requirements for simplification, flexibility and cost by BEC's customers, representing a number of Danish efficiency. banks.

• EVRY entered into a comprehensive agreement • Together with BN Bank, Handelsbanken and to provide payment services to Sparebanken Sør, Spareskillingsbanken, EVRY has developed a Java-free Sparebanken Sogn og Fjordane, Helgeland Sparebank internet banking solution. The advantages of Java-free and Gjensidige Bank. The contract runs for a period of Internet banking are that users can log in without hav- five years, and represents total contract value of ap- ing to install and update Java, and the Internet banking proximately NOK 1.2 billion. The contract also includes service is accessible from mobile phones and tablets. renewal of the banks' core banking and payment This solution will be implemented for a number of areas. other banks over time.

• EVRY and Sparebanken Vest have entered into a • NorgesGruppen and EVRY signed an agreement for strategic agreement for a 5-year period. The agree- company cards and gift cards. The contract runs for ment is intended to meet the challenge of a dynamic five years, and represents a breakthrough for EVRY's market that is characterised by banking customers push into the market for card solutions in the retail who want new and innovative services that are simple, sector. 18 Corporate Social Responsibility

Social corporate responsibility

EVRY strives to be a sustainable and robust company that fully recognises its responsibility to society as a whole, its environmental responsibility and its responsibility for employees, and we want to be proud of how we achieve this. During 2014, we have taken further steps to limit our impact on the climate.

EVRY is a market-leading company in the Nordic IT services Good results market, and we want to play a clear role as a corporate citi- Over the course of 2014 we have implemented new measures zen. As part of this, we have taken steps to ensure that we can that now place EVRY high up the list for environmentally report a very strong performance in terms of our impact on responsible performance. We first received a CDP score in the climate when compared with other organisations. 2012 when we were awarded 79, with the maximum score being 100. We improved our score in 2013 to 89, including by We have worked systematically on environmental issues for increasing the accuracy and scope of our reporting. We have a number of years, and the measures we implement address further increased our score in 2014 to 91. CDP also assesses many levels. We work continuously to reduce our own en- how well companies perform in terms of the positive actions vironmental impact by improving energy efficiency, waste they demonstrate, with companies graded on a scale that management, digital business solutions, reducing business runs from A (the best score) to D. EVRY also made prog- travel and sound procurement policies. ress in this area, as its score improved from B in 2013 to A in 2014, and so EVRY for the first time was included in the EVRY’s aim is to digitalise every aspect of its activities that Climate Performance Leadership Index, along with two other can be digitalised, and the services we deliver help our cus- Norwegian companies. tomers to do the same. Digitalising manual work processes allows society to reduce the amount of paper it uses, and this EVRY is a large-scale supplier of operating services and also reduces transport requirements. most of our emissions are related to our activities in this area. EVRY’s progress on the CDP measures is a result of Systematic measurement the systematic adoption of environmental measures carried EVRY has produced an annual climate report in accordance out through the line management of Nordic Operations. with the Greenhouse Gas Protocol since 2012. We can there- Virtualisation and the introduction of environmental re- fore monitor how our consumption changes over time. This quirements for suppliers are two examples of measures that makes it possible to compare consumption between different have delivered good results. EVRY has started a comprehen- locations, evaluate good practice, implement appropriate sive process to consolidate its old data centres, which con- measures and evaluate their performance. In addition to sume a lot of electricity. The company has at the same time supporting internal measures to improve environmental completed its new data centre at Fet. The new data centre responsibility, the climate reports allow us to participate in was officially opened in April 2015, and uses an entirely new the Carbon Disclosure Project (CDP). CDP is an independent and innovative air cooling system to remove waste heat from not-for-profit organisation that maintains the largest data- EVRY’s hardware. The air cooling system, combined with base in the world of statistics on corporate performance in EVRY’s use of modern and low-energy servers, make this relation to climate gas emissions, including performance data one of the most efficient and sustainable data centres in the and reporting. The CDP data is used by investors throughout world. the world to evaluate how well companies respond to their climate challenges. Failure to participate or poor results may make a company less attractive as an investment. It is therefore important for EVRY to achieve good CDP results. Corporate Social Responsibility 19 20 Key Figures

Operating revenue by business area

Operating revenue 2014

12.7 BN 1. EVRY Norway 46 % 2. EVRY Sweden 26 % 3. EVRY Financial Services 28 %

Operating revenue EBITA 2014

NOK Operating pro t before amortisation 15000 of intangible assets (EBITA)* in NOK million 12500

10000

7500

5000 2500 813 0 *Adjusted for non-recurring items 2010 2011 2012 2013 2014

EBITA development Cash ow from operations

NOK million NOK million

800 1200 700 1000 600 800 500 400 600 300 400 200 200 100 0 0 2010* 2011 2012 2013 2014 2010* 2011 2012 2013 2014

* Proforma * Proforma Key Figures 21

A Nordic IT services provider

Number of employees by segment EVRY Norway 6 447 of which Global Sourcing 3 103 EVRY Sweden 2 219 EVRY Finacial Services 1 457

Our climate performance score

EVRY's score improved from 78 in 2012 to 91 in 2014

The Carbon Disclosure Project (CDP) is a non-pro t organisation that works to evaluate companies' performance in reducing their environmental impact. The best CDP score is 100 points. 22 Key Figures

Key figures for the Group

2014 2013 1) 2012 2) 2011 3) 2010

Key figures (NOK million) Operating revenue 12 773 12 600 12 731 12 841 8 676 Profit before depreciation and write downs (EBITDA) 1 020 1 128 1 010 1 084 510 Profit before amortisation of intangible assets (EBITA) 543 673 484 612 (93) EBITA before non-recurring items 813 764 691 671 351 EBITA-margin 4.2% 5.3% 3.8% 4.8% -1.1% EBITA-margin before non-recurring items 6.4% 6.1% 5.4% 5.2% 4.0% Number of employees 10 350 10 323 9 873 9 518 9 661 Market capitalisation 4 246 2 654 2 346 2 595 4 223

Key figures per share (NOK) Earnings per share -3.26 -0.29 0.60 0.61 -1.34 EBITDA per share 3.82 4.23 3.79 4.08 2.87 Cash flow from operations per share 3.64 3.83 2.71 2.00 1.61 Book equity per share 16.02 20.04 20.46 19.88 28.65 Average number of shares 266 994 898 266 798 981 266 421 202 265 912 188 177 914 125

Solidity Equity ratio 40% 45% 45% 42% 38% Gearing 0.60 0.53 0.55 0.57 0.59 Net interest-bearing liabilities 2 568 2 966 3 007 3 024 3 023

Liquidity (NOK million) Cash and bank deposits 616 558 561 694 1 530 Liquidity reserve 2 414 2 145 2 013 1 931 1 952 Cash flow from operations 973 1 026 723 531 287 Investments in fixed assets 398 482 425 378 225 Investments in in-house developed software 93 143 86 61 168 Free cash flow 482 402 211 92 -107 Net working capital 94 339 463 621 188 Working capital as percent of revenues 0.7% 2.7% 3.6% 4.8% 2.2%

1) The financial figures for 2013 are restated due to implementation of IFRS 11 Joint Arrangements with effect from 1 January 2014 and the classification of EVRY Danmark A/S as discontinued operations 2) The financial figures for 2012 are restated due to implementation of IAS 19 Employee Benefits 3) Excluding pension effect of NOK 112 million in 2011 (IAS 19) Key Figures 23

Key figures by segment

NOK million 2014 2013

EVRY Financial Services Operating revenue 3 682 3 554 EBITA 371 326 EBITA-margin 10.1% 9.2% Operational investments incl in-house developed software (CAPEX) 115 188 Number of employees 1 457 1 490

EVRY Sweden Operating revenue 3 472 3 293 EBITA 255 213 EBITA-margin 7.3% 6.5% Operational investments incl in-house developed software (CAPEX) 80 66 Number of employees 2 218 2 308

EVRY Norway Operating revenue 6 093 6 180 EBITA 322 359 EBITA-margin 5.3% 5.8% Operational investments incl in-house developed software (CAPEX) 255 334 Number of employees Nordic 3 344 3 378 Number of employees Global Sourcing 3 103 2 861

Definitions of key figures

EBITA Net interest-bearing liabilities Free cash flow Earnings before tax, interest and Total of current and long-term interest- Cash from operations less investment depreciation and write-down of bearing liabilities less cash and bank spending. intangible assets. deposits. Cash flow per share Equity ratio Net working capital Net cash flow from operations Total equity capital as a percentage Current assets excluding bank deposits divided by average number of shares of total equity and liabilities. less non interest-bearing current outstanding. liabilities. Gearing Average number of shares after dilution Net interest-bearing liabilities divided Invested capital Average number of shares outstanding by total equity. Goodwill plus net working capital plus less the company’s holding of its own net long-term assets and commitments shares plus the average number of Liquid assets (excluding other intangible assets, new shares equivalent to the dilution Bank deposits. deferred tax and provisions for effect of employee share options and restructuring). convertible loans. 24 From the Boardroom Executive Management

Björn Ivroth Håvard Larsen CEO Executive Vice President, Head of business area Nordic Operations Björn Ivroth has more than 30 years’ experience from top management positions at Håvard Larsen was previously EVP - Solutions at EVRY and ErgoGroup. Prior to this, he large IT companies such as CGI, IBM and Accenture, and from having worked as a was Managing Director of TDC Norway, TDC Internordia and Compaq Norway. Håvard consultant at McKinsey. From 2012 to 2014 he was the Managing Director of CGI Larsen is a business economics graduate of the BI Norwegian Business School, Sweden, where he led the company’s business transformation. CGI is the fifth-largest and has completed various management programs at Babson College, Boston and independent supplier of IT and business process services in the world. Björn elsewhere. Ivroth has a master's degree in business economics from the School of Business, Economics and Law at the University of Gothenburg. He is a member of the board of Swedish IT and Telecom Industries, an industry and employer association for IT and Niclas Ekblad telecom companies in Sweden. Executive Vice President, Head of business area Sweden Niclas Ekblad was previously Director - Nordic Region at ErgoGroup. Prior to this, he was CEO of SYSteam where he also held other senior management positions. Knut E. Røsjorde He joined SYSteam in 1989. Niclas Ekblad has higher education qualifications in CFO industrial electronics and production from Jönköping. Knut E. Røsjorde was previously Head of the Subsea Norway & Africa business area of Aker Solutions, and he was CFO of the entire Subsea division from 2008 to 2011. He held a number of senior management positions in Aker Solutions, including SVP Kurt S. Helland Finance & Operations, Products & Technology and VP Group Risk Management and Executive Vice President, Head of business area Regions Norway Global Execution Excellence. Knut E. Røsjorde has a master's degree in industrial Kurt S. Helland has many years' experience from senior management positions in the economics from the Norwegian University of Science and Technology in Trondheim IT industry, including positions as CEO of Viju and CEO of Allianse, where his respon- (NTNU), and has also completed the Norwegian Air Force Command School training. sibilities included the merger process with ErgoGroup in 2006. Kurt S. Helland has a bachelor's degree from the University of Stavanger / BI Norwegian Business School. Anne-Cecilie Fagerlie Executive Vice President, Head of business area Industries Norway Morten Søgård Anne-Cecilie was previously CEO of Avanade Norden, SVP Group IT at Aker Kværner, Executive Vice President, Corporate Development and Senior Executive and Partner at Accenture. Anne-Cecilie Fagerlie has a master’s Morten Søgård was previously Head of the Integration Management Office at EVRY. degree in computer science from the Norwegian University of Science and Prior to this, he was Head of IT Operations at ErgoGroup and Sales & Marketing Technology (NTNU). Director at ErgoGroup. His earlier work experience included senior management positions at CSC Nordic and PMSC Nordic. Morten Søgård has a master's degree in business and marketing from the Oslo School of Economics. Wiljar Nesse Executive Vice President, Head of business area Financial Services Wiljar Nesse was previously Head of the Bank & Finance business area at EDB Business Partner. His earlier work experience included Elkem and AP Dow Jones. He joined EDB Business Partner from Manamind AS, where he was the chief executive and part owner. In addition, Wiljar Nesse has extensive experience of senior management positions in IT companies, with particular focus on IT solutions for the finance industry. Wiljar Nesse has a master's degree in business economics from the Norwegian School of Economics. From the Boardroom 25

Björn Ivroth Knut E. Røsjorde Anne-Cecilie Fagerlie

Wiljar Nesse Håvard Larsen Niclas Ekblad

Kurt S. Helland Morten Søgård 26 From the Boardroom The Board of Directors

Jo Lunder Department of Mergers and Acquisitions at the accounting firm Coopers & Chairman of the Board Lybrand. Zehavit Cohen has also lectured in Finance and Accounting at the Jo Lunder was until recently CEO of VimpelCom Ltd, a position he was Wharton School, University of Pennsylvania since 1988. Zehavit Cohen has appointed to in 2011. Before joining VimpelCom, Jo Lunder was President of a BA in Accounting from Duquesne University, an MBA from the University of Ferd Capital and an executive vice president at Ferd AS. He was also the CEO Pittsburgh, and an MA from the Wharton School, University of Pennsylvania. of Atea ASA and the CEO of OSJC VimpelCom, and held senior management positions at Telenor for many years. Jo Lunder has a bachelor’s degree from Göran Lindahl Oslo Business School and an MBA from Henley Management College at the Board Member elected by shareholders University of Reading, UK. Göran Lindahl was the CEO and president of the global technology and engineering group ABB Ltd from 1997 to 2000, and spent more than 30 years Salim Nathoo in various positions within the ABB group. He has also previously served on Deputy Chairman the Boards of Atlas Copco AB, El du Pont de Nemours and Company, the Sony Salim Nathoo is a Partner in the Tech & Telco team and is based in London. He Corporation, Ericsson and Saab. He has also worked as a special advisor to joined Apax Partners in 1999 specialising in the Tech & Telecom space. Prior the UN Secretary General Kofi Annan. Göran Lindahl has a master’s degree to joining Apax, Salim Nathoo was a consultant at McKinsey where he special- in electrical engineering from Chalmers University in Gothenburg, Sweden. ised in advising clients in the telecom sector. Salim Nathoo has an MBA from Göran Lindahl currently chairs the Boards of Directors of IKEA Greentech INSEAD and an MA in Mathematics from the University of Cambridge. AB and LivSafe Group, and is a member of the Board of Directors of INGKA Holding BV. Ellen de Kreij Jan Dahlström Board Member elected by shareholders Ellen de Kreij is a member of Apax’s Investor Relations team based in London, Board Member elected by employees with a particular focus on European investors. She is also responsible for the Jan Dahlström is currently employed as a Senior Project Manager. Jan implementation of the Apax sustainability programme. Ellen de Kreij joined Dahlström has higher education qualifications from the University of Apax Partners in 2002 as Director of Deal Generation and became a Director Gothenburg in medicine and business engineering from IHM. He has also in the Investor Relations team in 2010. Prior to joining Apax, she worked as held board appointments at a number of Swedish stock exchange listed an investment banker in the mergers & acquisitions teams at Merrill Lynch companies. and Broadview International, where she specialised in advising transactions in the technology sector. Ellen de Kreij has an MA in Dutch Civil Law from the Eirik Bornø University of Leiden and an MBA from Harvard Business School. Board Member elected by employees Eirik Bornø is currently employed as a Senior Employee Representative, Louise Sondergaard Negotia in EVRY, and he has many years’ experience as a DB2 system pro- Board Member elected by shareholders grammer. He has also been a premises manager in the company. Eirik Bornø Louise Sondergaard is a member of Apax’s Tech & Telco team. She joined has higher education qualifications in Administrative Data Processing from Apax in 2014 and is based in London. Prior to joining Apax Partners, Louise Polytekniske Høyskolen (now Westerdals Oslo School of Arts, Communication Sondergaard was an associate at McKinsey & Company in their London office, and Technology), and in Human Resource Management and Employment where she primarily worked on restructuring, transformation and strategy Law from Buskerud University College. He is second Vice President of the topics. Louise Sondergaard has an MSc from London Business School (with Federation Board of Negotia. distinction) and a BSc in International Business from Copenhagen Business School. Ola Hugo Jordhøy Board Member elected by employees Rohan Haldea Ola Hugo Jordhøy is currently employed as a Chief Consultant in Mobility at Board Member elected by shareholders EVRY. He has many years’ experience in IT and telecommunications. He has Rohan Haldea is a Partner in Apax’s Tech & Telco team. He joined Apax in 2007 an MSc-level degree in electrical engineering from the Norwegian University and is based in the London office. Prior to joining Apax Partners, Rohan Haldea of Science and Technology (NTNU) and also has qualifications relevant to was an Associate at Bain Capital in their North American private equity division teaching at university level. Ola Hugo Jordhøy is the chair of the Board of in New York, where he specialised in evaluating and executing transactions in the private sector section of the Norwegian Society of Graduate Technical the Industrial, Distribution and Retail sectors. He also has worked as a consul- and Scientific Professions (Tekna Privat) and the Chair of Tekna’s Salary and tant at McKinsey and Co. in India. Rohan Haldea has an MBA from the Harvard Members’ Interests Committee. Business School and a Bachelor of Technology in Manufacturing Sciences and Engineering from the Indian Institute of Technology, New Delhi. Ingrid Lund Board Member elected by employees Zehavit Cohen Ingrid Lund is currently employed as a Senior Consultant and has worked in the IT sector since 1985 in roles in the private and public sectors. She has also Board Member elected by shareholders completed a foundation course in law. Ingrid Lund was previously a member Zehavit Cohen is a Managing Partner and the Office Head of Apax Partners of the Boards of EDB Norway, EDB ASA and was a deputy member of the Board Israel Ltd. Prior to joining Apax Partners, Zehavit Cohen was Deputy Director of the Telenor Pension Fund. General of IDB Holdings and Chief Financial Officer of the IDB Group. She has also been a VP at Chase Manhattan Bank and was a part of the International From the Boardroom 27

Jo Lunder Salim Nathoo Ellen de Kreij Louise Sondergaard

Rohan Haldea Zehavit Cohen Göran Lindahl Jan Dahlström

Eirik Bornø Ola Hugo Jordhøy Ingrid Lund 28 From the Boardroom

Corporate Governance

EVRY is committed to healthy corporate governance that strengthens confidence in the company and contributes to optimal value creation over time. The objective of corporate governance is to regulate the division of roles between shareholders, the Board of Directors and executive management more comprehensively than is required by legislation.

Our principles: The Oslo Stock Exchange requires listed companies to publish • EVRY will provide open, reliable and relevant communica- an annual statement of their policy on corporate governance in tion to the outside world about the company’s activities and accordance with the Code of Practice in force at the time. The its corporate governance. rules on the Continuing Obligations of stock exchange listed • EVRY’s Board of Directors will be autonomous, and inde- companies are available at www.oslobors.no. pendent of the company’s executive management. • EVRY will pay particular attention to ensuring that there The group follows all the recommendations of the Code of are no conflicts of interest between the interests of its Practice, and it does not deviate from the recommendations in shareholders, the members of its Board of Directors and its any material respect. executive management. • EVRY will ensure a clear division of responsibility between Values and guidelines for business ethics and corporate social the Board of Directors and the executive management. responsibility • EVRY will treat all shareholders equally. Confidence in EVRY as a company and in its business activities as a whole is essential for the group’s continuing 1. Implementation and reporting on corporate governance competitiveness. Implementation EVRY’s Board of Directors (the “Board”) has the ultimate EVRY is committed to openness about its systems and proce- responsibility for ensuring that the company practices good dures for the management of the group. This strengthens value corporate governance. The Board and executive management creation and builds internal and external confidence, while at carry out a thorough review and evaluation of the principles the same time promoting an ethical and sustainable approach for corporate governance on an annual basis. to business.

EVRY ASA is a Norwegian public limited company and is The Board has approved comprehensive guidelines for busi- listed on the Oslo Stock Exchange (Oslo Børs). The Norwegian ness ethics (Code of Conduct). The group carries out annual Accounting Act includes provisions on corporate governance measures in all business areas to ensure employee awareness at Section 3-3b which impose a duty on the company to issue of, and commitment to, the Code of Conduct. Each year, an annual report on its principles and practice for corporate all employees of the group, including employees of wholly- governance. These provisions also stipulate minimum require- owned subsidiary companies, must sign a declaration to con- ments for the content of this report. firm that they have read and understood the Code of Conduct. All new employees receive training in the Code of Conduct as The Norwegian Corporate Governance Board (NCGB) part of their introductory training program, and must sign a has issued the Norwegian Code of Practice for Corporate declaration to confirm that they have read and understood the Governance (the “Code of Practice”). The company must com- guidelines. ply with all the recommendations of the Code of Practice or explain why it has chosen an alternative approach to specific The EVRY website at www.evry.com provides more informa- recommendations. The Code of Practice imposes more com- tion about the company’s corporate vision, business concept prehensive requirements than the Accounting Act in respect of and strategy, as well information on the company’s policy for the information that the company must provide. social responsibility and its Code of Conduct. From the Boardroom 29

2. Business Purchases of the company’s own shares The business objective of EVRY ASA is defined in Article 3 of the The Board held a mandate at 31 December 2014 to buy back company’s Articles of Association, which states that: shares which is limited to shares with a total nominal value of NOK 8,750,000. The mandate stipulates that the company “The company’s business is to develop, manage and operate its can only use its holdings of its own shares in connection with own and other parties’ IT solutions, to sell services and consul- the share purchase scheme for employees as approved by the tancy and any activities related to the foregoing. These activities Annual General Meeting. This authorisation is valid until the may be carried out by the company itself, by its subsidiaries or date of the next Annual General Meeting. through participation in other companies and collaboration with other parties.” As at 31 December 2014, EVRY held 303,080 of the company’s own shares, representing 0.11% of the total number of issued EVRY’s Articles of Association are available on the EVRY website shares. at www.evry.com. The Articles of Association were most recently updated on 14 May 2014. 4. Equal treatment of shareholders and transactions with close associates 3. Equity and dividends Equal treatment Equity EVRY has only one class of shares, and any purchases or sales of The book value of the group’s equity at 31 December 2014 was own shares are carried out through the stock exchange. NOK 4,277 million, representing an equity ratio of 40%. The The Articles of Association do not impose any restrictions on Board considers this to be satisfactory. The group’s capital ade- voting rights. All shares have equal voting rights. quacy is kept under constant review in relation to its objectives, strategy and risk profile. Transactions with close associates EVRY’s Board and executive management are committed to Dividend policy treating all the company’s shareholders equally. At the close of The company’s objective is to generate a return for its share- 2014, the company had two major shareholders. Posten Norge holders through dividends and increases in the share price that AS held 40.0% of the share capital of EVRY ASA, and Telenor is at least in line with the return available on similar investment Business Partner Invest AS held 30.2%. opportunities of comparable risk. The Board proposes a dividend if it is satisfied that this will not have an adverse effect on EVRY has extensive operating services agreements with both the company’s future growth ambitions and capital structure. Posten and Telenor. The company both delivers services to and The company's dividend policy is to pay an annual dividend purchases services from both these groups, and in addition, to shareholders equivalent to 20-50% of normalised post-tax Telenor and EVRY offer various services to the market as joint profit. Extraordinary dividends may be distributed in particular suppliers. circumstances, and will be evaluated on a case to case basis. EVRY’s Board and management are satisfied that all agreements In connection with the process whereby Lyngen Bidco AS entered into between the company and its main shareholders has acquired 88% of the share capital of EVRY ASA, an (including related companies), as well as all other business Extraordinary General Meeting held on 23 March 2015 approved transactions and contracts, are on an ‘arm’s length’ basis. an extraordinary dividend of NOK 3.76 per share, equivalent to NOK 1,005 million. The Board will obtain independent valuations for any material transactions between the company and its shareholders, parent Increases in share capital companies of its shareholders, members of the Board, executive The Board did not hold any mandates in respect of increases personnel or any close associates of such parties. in share capital at 31 December 2014, and will not propose any increase in share capital or request a mandate for increases in The company has guidelines in place to ensure that members of share capital at the Annual General Meeting, which is due to be the Board and executive personnel notify the Board if they have held on 26 May 2015. any material interest, directly or indirectly, in an agreement entered into by the company. EVRY ASA did not carry out any capital transactions in 2014. 30 From the Boardroom

5. Freely negotiable shares how their proxy should vote on each matter to be considered. Shares in EVRY ASA are freely negotiable. The Articles of Representatives from the Board attend the AGM, together with Association do not impose any restrictions on transfers of at least one representative from the Election Committee, and shares. the auditor. The executive management is represented at the AGM with, at a minimum, the CEO and the CFO attending. EVRY ASA is listed on the Oslo Stock Exchange. Agenda and conduct of the AGM 6. General Meetings The Board decides the agenda for the AGM. The main agenda The Annual General Meeting items are determined by the requirements of the Public The Annual General Meeting (“AGM”) is the company’s ulti- Limited Liability Companies Act and Article 7 of the Articles of mate corporate body. The Board strives to ensure that AGMs Association. Each AGM appoints a chairperson for the meeting, are an effective forum for communication between sharehold- thereby ensuring that the AGM has an independent chair ers and the Board. person in accordance with the recommendations of the Code of Practice. The CEO gives a presentation of the group at each Preparation for the AGM AGM. The Audit Committee and the Compensation Committee The AGM is usually held before 1 June each year, and in any present their work over the past 12 months. The AGM minutes case no later than 30 June, which is the latest date permitted are published by issuing a stock exchange announcement, and by company law. The 2014 AGM was held on 14 May. The 2015 are also made available on the EVRY website at www.evry.com. AGM will be held on 26 May. 7. Election Committee The notice calling the AGM and any Extraordinary General EVRY has an Election Committee consisting of three members. Meeting is made available on the company’s website (www. The members of the Election Committee are elected by the evry.com) and sent to shareholders by post no later than three AGM after considering proposals made by the current Election weeks in advance of the meeting. Article 7 of the Articles of Committee. The members of the Election Committee serve for Association stipulates that the supporting documents dealing a two-year term of office. The company has arranged for share- with matters to be considered by the AGM can be made holders to communicate their views on the composition of the available on the company’s website rather than being sent to Election Committee through the company’s website at www. shareholders by post. However, shareholders are still entitled evry.com. The AGM also issues the mandate for the work of the to receive the documents by post upon request if they so wish. Election Committee and determines its remuneration in accordance with Article 8 of the company’s Articles of Association. The supporting documentation provides all the necessary information for shareholders to form a view on the matters to The Election Committee’s duties are to nominate candidates be considered. In accordance with the company’s established for consideration by the AGM for appointment as sharehold- practice, the deadline for shareholders to notify their inten- er-elected members of the Board, including the Chairman, tion to attend a general meeting can be no earlier than the day and any deputy members for shareholder-elected members, before the date of the meeting. and to nominate candidates for the members of the Election Committee. The mandate for the Election Committee includes The date of the next AGM is included in the company’s guidance on selecting suitable candidates to ensure an appro- financial calendar. The financial calendar for the coming year priate composition of expertise on the Board. The Election is published no later than 31 December in the form of a stock Committee is also responsible for carrying out an annual exchange announcement, and is also made available on the review of the remuneration paid to the members and deputy company’s website at the same time. members of the Board and submitting specific proposals in this respect to the AGM. Participation in the AGM Shareholders must give written notice of their intention The 2014 AGM approved the re-election of Bjørn Magnus to attend the AGM, either by post, via their VPS securities Kopperud and Erik Amlie (Chairman of the Election Committee) account, or by e-mail. Shareholders who are unable to attend as members of the Election Committee for a term of office of up the meeting are encouraged to appoint a proxy. The arrange- to 2 years. The term of office of the third member of the Election ments for appointing a proxy allow shareholders to specify Committee, Gro Bakstad, expires at the 2016 AGM. From the Boardroom 31

The members of the Election Committee with effect from the manner. The Board’s guidelines require that members must no- 2012 AGM are: tify the Chairman if the Board is to consider any matter in which • Erik Amlie, Chairman they may have a financial interest or are otherwise involved. • Gro Bakstad, Posten Norge AS • Bjørn Magnus Kopperud, Telenor ASA Information on holdings of shares in EVRY ASA by the former members of the Board as at 31 December 2014 is provided in Information on the duties of the Election Committee, its notes to the consolidated accounts for 2014. current members and the timetable for submitting proposals for new members can be found on the EVRY web site at An updated overview of the members of the Board of EVRY ASA, www.evry.com. The formal mandate for the work of the including their independence, employment, education and pro- Election Committee is also provided on the website. fessional background, and holdings of shares in the company, is provided on the company’s website at www.evry.com. 8. Board of Directors: composition and independence Elections to the Board 9. The work of the Board EVRY does not have a corporate assembly by agreement The Board’s duties and responsibility between the company’s trade unions, Board and executive The Board has the ultimate responsibility for the management management. of the group and supervising its day-to-day management and activities in general. The members of the Board and the Chairman of the Board of EVRY are elected by the AGM. The Deputy Chairman of the Board This includes developing the company’s strategy and mon- is elected by the Board. These arrangements for the election of the itoring its implementation. In addition, the Board exercises Board are stipulated in Article 5 of the Articles of Association. supervision responsibilities to ensure that the company manages its business and assets and carries out risk manage- The composition of the Board ment in a prudent and satisfactory manner. The Board of EVRY ASA comprised nine members as at 31 December 2014. Changes to the composition of the Board of The Board is responsible for the appointment of the CEO. EVRY ASA were approved at an Extraordinary General Meeting The Board prepares an annual plan for its work. held on 23 March 2015. Following these changes, the Board comprises 11 members. Seven members of the board, of which Mandate for the Board three are women, are elected by shareholders, and four mem- In accordance with the provisions of Norwegian company bers, of which one is a woman, are elected by the employees. law, the terms of reference for the Board are set out in a formal mandate that includes specific rules and guidelines on the The shareholder-elected members represent varied and broad work of the Board and decision making. The Chairman of the experience from relevant industries and areas of technical Board is responsible for ensuring that the work of the Board is speciality, and the members bring experience from both carried out in an effective and proper manner in accordance Norwegian and international companies. EVRY believes that with legislation. the Board as a whole represents the best interests of all the company’s shareholders. Mandate for the CEO The Board issues a mandate for the work of the CEO. There is Independence of the Board a clear division of responsibilities between the Board and the The Board does not include any members from the company’s CEO. The CEO is responsible for the operational management executive personnel. of the group.

The other shareholder-elected members of the Board are con- Financial reporting sidered to be independent of the company’s main shareholders The Board receives regular reports on the company’s commer- and its material business connections. cial and financial status. The company follows the timetable laid down by the Oslo Stock Exchange for the publication of The Board has rules on conflicts of interest to ensure that any interim and annual reports. potential conflicts are identified and handled in a professional 32 From the Boardroom

Board meetings The Board holds regular meetings and a strategy meeting each year. Extraordinary Board meetings are held as and when required to consider matters that cannot wait until the next regular meeting. In addition, the Board has appointed an Audit Committee and a Compensation Committee to work on matters in these areas.

Audit Committee The Audit Committee is appointed by the Board, and its main responsibilities are to supervise the group’s systems for internal control, and to ensure that the auditor is independent and that the annual accounts give a fair picture of the group’s financial results and financial condition in accordance with generally accepted accounting practice. The Audit Committee has reviewed the procedures for risk management and Whistle blowers financial controls in the major areas of the group’s business activities. The Audit Committee receives reports on the work Advokatfirma Hestenes of the external auditor and the results of the audit. In addition, og Dramer & Co the company has appointed a head of Internal Audit who is v/advokat Frode Sulland responsible for the internal audit function.

Tlf: +47 24 14 53 50 The members of the Audit Committee as of 31 December 2014 Faks: +47 24 14 53 51 were: E-post: [email protected] • Tone Wille, Chair • Anders Brandt • Eirik Bornø

Compensation Committee The Compensation Committee makes proposals to the Board on the employment terms and conditions and total remuneration of the CEO and other executive personnel. These proposals are also relevant for other employees.

The members of the Compensation Committee as at 31 December 2014 were: • Arve Johansen, Chair • Hilde Ringereide • Ingrid Lund

As a result of the changes to the composition of the Board of EVRY ASA on 23 March 2015, the members of the Audit Committee and the Compensation Committee also changed. Information on these changes was published as a stock exchange announcement on 24 March 2015.

Arrangements for anonymous employee contact with the Board EVRY places great importance on ensuring that employees can freely express their views and provide feedback to the From the Boardroom 33

Board. In order to ensure anonymity, the Board has set up five levels of decision-making committees, which have clearly a contact point for ‘whistleblowers’ through the law firm defined authority limits for all the relevant types of decisions. Hestenes og Dramer & Co in Oslo to ensure that information can be submitted without the company knowing the identity EVRY has a legal department, managed by the in-house of the sender. The Board has drawn up a specific policy for the attorney who reports directly to the CFO. The head of the handling of such referrals, including arrangements to monitor legal department also fulfils the role of secretary to the Board the progress of each case. and therefore has direct access to members of the Board. Procedures and guidelines are in place to ensure that the legal The Board’s evaluation of its own work department is involved in all activities over a certain size that The Board carries out an annual evaluation of its own per- might represent legal risks for the group, including bidding for formance, working arrangements and competence. The contracts and entering into agreements. The group has stan- Chairman of the Board prepares a report on this evaluation, dard policies for contract terms and conditions that are used which is made available to the Election Committee. The Board when entering into contracts. also carries out a similar evaluation of the CEO. EVRY’s CEO and CFO hold monthly status meetings with each 10. Risk management and internal control business area. These meetings review commercial perfor- Main features mance and decide on appropriate follow-up measures. EVRY’s risk management and internal control is based on EVRY’s framework for risk management uses a predefined elements of the COSO framework, and helps ensure that process and methodology, and work is underway to ensure EVRY has unified control in place that covers the company’s that this framework is harmonised throughout the com- operational activities, financial reporting and compliance with pany. The CEO and Board receive periodic reports on risk legislation and regulation. management.

Internal audit The company strives to adapt its control processes to local EVRY has a separate internal audit department, which operations and to ensure a pro-active approach to risk man- reports directly to the Board and the Audit Committee. The agement, so that the risks involved in normal operations are Board has approved a mandate that defines the objectives, systematically identified, analysed and managed. It also en- authority and responsibility of the internal audit function. sures that risk exposure is continually monitored. Corrective The internal audit department is managed by the head of measures are identified and defined, as is responsibility for Internal Audit, and has four full-time equivalent employees. following up specific risk areas. The department’s work is based on an annual program and annual report that is evaluated and approved by the Board. EVRY also continually monitors market conditions and key economic figures that provide the basis for evaluating financial risk. EVRY is not subject to direct supervision by Finanstilsynet (the Financial Supervisory Authority of Norway), but Risk related to financial reporting Finanstilsynet can exercise control over the group through EDB Business Partner ASA was a subsidiary of Telenor ASA the banks that are customers of the company in accordance prior to the merger with ErgoGroup AS in October 2010. As with the ICT regulations. a result of this relationship, EDB Business Partner ASA was subject to the Sarbanes Oxley Act (SOX) because Telenor ASA Operational control was listed on the NASDAQ exchange. EVRY has implemented an Approval Authority Matrix and guidelines to specify the level of authority granted to indi- In accordance with the need for sound internal control and viduals and the next level of authority required to decide or management systems, the Board of EVRY has decided that approve matters beyond the individual’s authority. The level of the company will continue to comply with certain aspects authority delegated to the CEO is approved by the Board, and of the requirements of the Sarbanes Oxley Act. This requires the entire Approval Authority Matrix, i.e. the manner in which extensive documentation of internal control for significant the CEO delegates this authority, has been considered and and key processes in the company. This reporting serves to approved by the executive management and reviewed by the improve the quality of the company’s control systems and of Audit Committee. The group’s organisational structure defines its financial and operational reporting procedures. Extensive 34 From the Boardroom

testing is carried out to ensure compliance with the estab- 12. Remuneration of executive personnel lished controls. The Board has approved a policy for the remuneration of the CEO and other executive personnel. In accordance with the Neither EVRY’s executive management nor its auditor report- requirements set out in the Public Limited Liability Companies ed any substantive weaknesses in the related internal control Act, the main features of this remuneration will be subject to systems at 31 December 2014. an advisory vote by the AGM.

Compliance with laws and regulations In accordance with Article 9 of the Articles of Association, Compliance with legislation and regulations, both in Norway share option schemes and arrangements for distributing and other countries in which the company operates, is shares to employees must be approved in advance by the ensured by means of the group's governance structure. Annual General Meeting. The important participants in this structure are the group's compliance function, group risk management, the executive EVRY offers performance-based remuneration for its executive management of each business area and the company’s legal personnel, which is linked to the creation of shareholder value department. The group's four compliance managers report and long-term earnings performance. The performance-based on compliance matters to the Group Compliance Officer on a remuneration paid to an individual cannot exceed a specified quarterly basis. The Group Compliance Officer in turn reports percentage of his or her fixed salary. to the Audit Committee. The group’s system for management by objectives provides the As mentioned above, the company has formal guidelines for main basis for determining the remuneration of managers and business ethics and social responsibility in the form of a Code employees. The group’s financial objectives represent the main of Conduct. All employees are required to confirm their under- parameter for evaluating executive management performance. standing of and compliance with the Code of Conduct on an They also determine whether bonuses are paid. The financial annual basis. The Code of Conduct is managed by the Legal objectives that provide the basis for executive management Department acting on behalf of the executive management. bonuses include EBITA and EBITA margin, as well as budgeted revenue targets. The performance of other employees is Annual review of internal control by the Board appraised relative to parameters set by the management by The Board receives regular reports on risk management at its objectives system, as well as revenue and earnings targets for meetings, through routine financial reporting and the execu- each business area. In addition to financial targets, perfor- tive management’s reports on each business area. mance appraisal includes customer satisfaction and employee satisfaction. Information on payments of performance-based In addition to its regular reviews of risk management, the remuneration to executive personnel can be found in notes to Board carries out an annual review of the group’s internal the annual accounts. control systems and the major risk factors to which the group is exposed. The Board evaluates whether the systems are 13. Information and communications sufficient, appropriate and properly applied. EVRY maintains regular dialogue with analysts and investors. The company considers it very important to inform share- 11. Remuneration of the Board of Directors and the Election holders and investors about the company’s commercial and Committee financial performance. The remuneration paid to the members of the Board is decided by the AGM having considered proposals by the Election The company strives to continuously publish all relevant Committee. In accordance with Article 8 of the company's information to the market in a timely, effective and non- Articles of Association, the AGM determines the remuneration discriminatory manner. All stock exchange announcements paid to the members of the Election Committee. are made available both on the company’s website and on the Oslo Stock Exchange news website at www.newsweb.no, and The remuneration paid to the members of the Board is not are also distributed through a news agency (Hugin). dependent on the company’s earnings. The notes to the accounts provide information on the remuneration paid to the Financial reports Board in 2014. EVRY normally publishes its provisional annual accounts by From the Boardroom 35

mid February. The complete annual report and accounts are Recommendation of a bid in 2014 made available to shareholders no later than three weeks prior On 8 December 2014, the Board resolved unanimously to to the AGM. Quarterly interim reports are normally published recommend a bid by Lyngen Bidco AS, a company indirectly in the third week following the end of the quarter. controlled by private equity funds managed by Apax Partners, for all the company's shares. In addition, the bid was accepted The company’s financial calendar for the coming year is pub- in advance by all members of the Board and executive manage- lished no later than 31 December in accordance with the rules ment who owned shares in the company directly or indirectly. of the Oslo Stock Exchange. The financial calendar is available on the company’s website and on the Oslo Stock Exchange Shareholders’ agreements in 2014 website. In connection with the merger of EDB Business Partner ASA and ErgoGroup AS in 2010, the main shareholders, Posten and Other market information Telenor, entered into agreements that regulate certain matters EVRY holds open presentations in connection with the relating to their shareholdings in the company. Since October publication of its interim reports. These presentations review 2012, transfers by either of the main shareholders are still sub- the published results, market conditions and the company’s ject to certain restrictions, including a right for the other party future prospects. The presentations are given by the CEO and to purchase the shares in question. the CFO at a minimum, and are distributed by webcast so that anyone unable to attend can follow the presentation on the The parties to the shareholders’ agreement have also agreed to internet in real time or view it later. encourage EVRY to participate in a future consolidation within its industry. The parties have established mechanisms whereby Quarterly reports, presentation material and webcasts are all a party may initiate a process to evaluate alternatives for the available on the EVRY website at www.evry.com. ownership and industrial development of the company. These mechanisms may come into effect, on certain conditions, The group takes a cautious approach in its contacts with indi- not earlier than five years after the completion of the merger vidual shareholders and investment analysts. The company does in October 2010. These provisions would require a party to not participate in any meetings with investors or analysts for participate in a transaction involving the company if it is sup- the four weeks prior to the publication of an interim report. ported by the other party, the Board of EVRY and a majority of the shareholders other than the parties. 14. Takeovers Basic principles and responsibilities 15. Auditor The Board of EVRY is committed to equal treatment of share- Election of the auditor holders and will ensure openness with respect to any potential Ernst & Young is the auditor for EVRY. takeover of the company. Auditor’s relationship with the Board and the Audit Committee Evaluation of a bid The auditor attends at least one meeting each year with the If a formal bid is made for EVRY, the Board will normally seek Board at which the company’s management is not repre- to attract competing bids. This will not apply if the Board sented. The auditor participates at meetings of the Board that unequivocally recommends the bid received, or if the process consider the annual accounts and participates at all meetings of seeking to attract a competing bid would cause a bid already of the Audit Committee. made to be withdrawn or expire. Auditor’s relationship with executive management If a bid is received for the company’s shares, the Board will The Board has issued guidelines for the conduct of the relation- issue a statement evaluating the bid together with a recom- ship between the auditor and the group. The Board regularly mendation on whether shareholders should or should not reviews this relationship, to ensure that the auditor is fulfilling accept the bid. If the Board finds that it is unable to recom- a satisfactory control function. The Board has ruled that EVRY mend whether or not shareholders should accept the bid, it can only use the auditor for consultancy work in cases where will explain its reasons for not making a recommendation. If such agreements are specifically approved by the Board. the Board’s statement is not the unanimous view of the Board, this will be explained. 36 From the Boardroom

Report from the Board of Directors 2014

The company's profitability strengthened throughout 2014 as a result of improvements in the segments EVRY Financial Services and EVRY Sweden. At the same time, targeted restructuring and improvement measures were carried out in the EVRY Norway segment in order to strengthen the group's long-term profitability in line with the company's EBITA targets as previously announced.

The company has been in a strategic process since the second Reported earnings per share for 2014 was NOK -3, 26 as com- half 2014, resulting in a change in the majority shareholder pared to NOK -0.29 for 2013. After adjusting for non-recurring structure. The Board of Directors and CEO of the company are items, earnings per share was NOK 1.85 for 2014 as compared to new as of 23/24 March 2015. The company has also refinanced NOK 1.49 for 2013. its external credit facility and paid an extraordinary dividend of NOK 3.76 per share as part of the new financing solution. Financial statements Operating revenue EVRY’s consolidated operating revenue for 2014 was NOK 12,773 The group’s operating revenue in 2014 was NOK 12,773 million million compared to NOK 12,600 million in 2013, equivalent as compared to NOK 12,600 million in 2013. The EVRY Financial to organic growth of 1% for the year. The company decided Services segment reported organic growth of 3% for 2014, while in 2014 to run down and close its SAP activities in Denmark. the EVRY Sweden segment reported organic growth of 4% for As a result of this decision to discontinue these activities, the the year. The EVRY Norway segment reported no change in financial results relating to this business are now reported organic revenue from 2013. Revenue generated by the EVRY separately in the consolidated statement of comprehensive Norway segment was adversely affected in 2014 by the loss of income as a separate line: "Profit after tax from discontinued revenue from Norway Post in the application management area. activities". Similarly, this company is no longer included as part of the EVRY Norway segment and comparable figures have been Operating result (EBIT) restated accordingly. The group’s operating result (EBIT) in 2014 was a loss of NOK 655 million, as compared to a profit of NOK 110 million in 2013. The group reported operating profit before amortisation and EBIT was negatively impacted by net non-recurring costs total- write-down of intangible assets (EBITA) for 2014 of NOK 543 ling NOK 1,435 million in 2014, of which NOK 77 million related million as compared to NOK 673 million in 2013. The group to the process initiated by the Board of Directors to evaluate reported non-recurring items of NOK 271 million in 2014 (before strategic alternatives. In addition, costs of NOK 120 million were write down of goodwill of NOK 1,164 million), and after adjust- recognised in 2014 in respect of restructuring measures, and a ing for this, consolidated EBITDA was NOK 813 million. In 2013 write-down of NOK 34 million was recognised for a project in the group reported net non-recurring items of NOK 92 million the EVRY Norway segment. The group's activities in Sweden (before goodwill write-downs totalling NOK 530 million), and were affected in the first quarter of 2014 by an explosive fire in after adjusting for this consolidated EBITDA in 2013 was NOK its data centre at Tomteboda, and non-recurring costs of NOK 764 million. The EBITA margin before non-recurring items was 40 million were recognised as a result of this event. Goodwill 6.4% in 2014 compared to 6.1% in 2013. was written down in 2014 by NOK 1,164 million as a consequence of the strategic process the company has been involved Operating result (EBIT) for 2014 was a loss of NOK -655 million in and the completed transaction at NOK 16 per share, which as compared to a profit of NOK 110 million for 2013. After corresponds to a value of group equity of NOK 4,277 million. Net adjusting for non-recurring items, EBIT for 2014 was a profit of non-recurring items in 2013 totalled NOK 621 million. Of this, NOK 780 million as compared to NOK 731 million for 2013. non-recurring items of NOK 600 million (with no future cash flow effect) were recognised in the fourth quarter of 2013, prin- Net financial expenses for 2014 totalled NOK 87 million, as cipally in relation to write-downs of balance sheet items incl compared to NOK 169 million in 2013. goodwill as a result of the decision by DNB not to renew some aspects of its infrastructure agreement with EVRY. From the Boardroom 37

Depreciation of tangible fixed assets and in-house developed Net cash flow from financing in 2014 was NOK -461 million, software amounted to NOK 477 million in 2014, with depre- which included payment of a dividend totalling NOK 107 mil- cation of in-house developed software accounting for NOK 88 lion. The group reported liquidity reserves of NOK 2,414 million million. On a comparable basis, depreciation amounted to NOK at the end of 2014, as compared to liquidity reserves of NOK 455 million in 2013, with depreciation of in-house developed 2,145 million at the end of 2013. software of NOK 69 million. The group’s total assets amounted to NOK 10,702 million at 31 Amortisation of intangible assets amounted to NOK 33 million December 2014, down from NOK 11,996 million at 31 December in 2014, in line with 2013. 2013. Intangible assets were reduced due to the write down of goodwill, while tangible fixed assets were reduced as a result of Net financial items and result for the year before and after tax lower investment spending in 2014 and equipment sales total- Net financial expenses was NOK 87 million in 2014, while the ling NOK 75 million. Other current receivables were lower at pre-tax result from continuing operations was a loss of NOK 743 the end of the year as a result of improvements in the company's million. Tax payable by the group for the year in 2014 amounted underlying working capital situation. Total non-current assets to NOK 86 million, and the post-tax result for 2014 from con- amounted to NOK 8,271 million at 31 December 2014, of which tinuing operations was a loss of NOK 828 million. The post-tax goodwill accounted for 77%. At the end of 2013, non-current result from discontinued operations in 2014 was a loss of NOK assets amounted to NOK 8,270 million of which goodwill 42 million. accounted for 80%.

On a comparable basis, net financial expense was NOK 169 Working capital was equivalent to 0.7% of revenue at the close million in 2013, while the pre-tax result from continuing oper- of 2014, while average working capital at the end of each of the ations was a loss of NOK 59 million. Tax income for the year in four quarters of the year was equivalent to 2.9% of revenue, 2013 amounted to NOK 7 million, and the post-tax result from representing a reduction of 1.6 percentage points compared continuing operations for 2013 was a loss of NOK 52 million. The to the close of 2013. The company has worked continuously to post-tax result from discontinued operations in 2013 was a loss reduce working capital. of NOK 26 million. The group’s equity was NOK 4,277 million as at 31 December Cash flow and financial position 2014, equivalent to an equity ratio of 40%. This represents a The group’s net cash flow from operations was NOK 973 million decrease from NOK 5,346 million at the end of 2013, which was in 2014 compared to NOK 1,026 million in 2013. The decline in equivalent to an equity ratio of 40%. cash flow from operations is largely due to the reduction in operating profit before depreciation and write-downs (EBITDA). Net interest-bearing debt was NOK 2,568 million at 31 The company's underlying working capital position continued December 2014, down by NOK 395 million from 31 December to improve throughout the course of 2014. The group's free cash 2013. This represents a ratio between net interest-bearing debt flow for 2014 was NOK 482 million as compared to NOK 402 and EBITDA of 2.46 at the end of 2014 as compared to 2.49 at the million for 2013. end of 2013 as measured in accordance with the definition in the company’s loan agreement. Investments in tangible fixed assets totalled NOK 398 million in 2014, down from NOK 482 million in 2013. In addition, Reporting segments leasing contracts totalling NOK 50 million were entered into The group reported in 2014 for the three segments EVRY in 2014. Investment in software developed in-house totalled Financial Services, EVRY Norway and EVRY Sweden. The EVRY NOK 93 million in 2014 as compared to NOK 143 million in 2013. Financial Services segment accounted for 28% of total revenues Investment by the EVRY Financial Services segment in the de- before internal netting in 2014, while the EVRY Sweden segment velopment of new bank applications for the Nordic market was accounted for 26% and the EVRY Norway segment for 46%. lower in 2014 than in 2013. Other development work carried out by the group relates to customer-specific projects, where Note 3 to the consolidated accounts provides more detailed the income associated with such projects exceeds development information on the group's reporting segments. costs. No material costs were recognised in respect of research and development activities in 2014. 38 From the Boardroom

EVRY Financial Services segment The EVRY Sweden segment's contractually agreed order backlog EVRY Financial Services offers a broad portfolio of solutions and at 31 December 2014 was NOK 2.2 billion, of which NOK 1.3 services, and is a complete industry vertical with responsibility billion is due for delivery in 2015. for all the company’s deliveries to bank and finance customers. The solutions portfolio includes solutions for all core banking At the start of January 2014, EVRY experienced an explosive fire services, whether this relates to interfaces with end-customers in its data centre at Tomteboda in Sweden. The situation made it or solutions to support a bank’s internal processes and em- necessary to commit additional resources in order to recon- ployees. The portfolio is module-based, and includes banking struct solutions and normalise deliveries for affected customers. services, transactions systems, payment solutions and card EVRY has insurance that covers this incident. The incident re- services. The portfolio also includes a unique value chain of card sulted in non-recurring costs totalling NOK 40 million in 2014. services that are delivered to banks in the Nordic countries and the United Kingdom. EVRY Norway Segment The EVRY Norway segment offers consulting, infrastructure and The EVRY Financial Services segment reported operating reve- operating services. EVRY Norway has a significant position in nue of NOK 3,682 million for 2014, representing organic growth the local government and healthcare sectors, and is currently in revenue of 3% from 2013. Revenue growth in 2014 was par- strengthening its position in other verticals including retail, ticularly strong in the Nordic card services area. oil & gas and insurance. Through its extensive activities, EVRY Norway has in-depth technical expertise in specialist services The EVRY Financial Services segment generated EBITA in 2014 of that are independent of geographic location and sector. This NOK 371 million as compared to NOK 326 million in 2013. EBITA includes growth areas such as mobility, cloud-based solutions margin for 2014 was 10.1% as compared to 9.2% in 2013. and Business Intelligence. The group also includes its Global Sourcing activities for reporting purposes in the EVRY Norway The EVRY Financial Services segment's order backlog at 31 segment. December 2014 was NOK 8.7 billion, of which NOK 2.6 billion is due for delivery in 2015. In 2014 the company secured renew- The EVRY Norway segment reported operating revenue of als of strategically important contracts with SpareBank 1 and NOK 6,093 million in 2014, representing no change in organic Sparebanken Vest, as well as with the group of four banks revenue from 2013. Revenue growth was adversely affected by Sparebanken Sør, Sparebanken Sogn og Fjordane, Helgeland approximately 3 percentage points as a result of the planned Sparebank and Gjensidige Bank. In total, agreements entered reduction in activity for Norway Post in the area of application into in 2014 represented overall contract value of NOK 4.0 management. The company took steps in 2014 to adapt the billion. segment’s organisation to market conditions in order to ensure future growth, and EVRY Norway is expected to generate EVRY Sweden segment organic growth in 2015. The EVRY Sweden segment offers everything from strategic advice and consulting services through to solutions and IT Global Sourcing activities accounted for 11% of the segment’s operating services. EVRY Sweden offers a significant portfolio of revenue in 2014, with sound organic growth throughout 2014. industry vertical solutions that combine industry-specific in- Deliveries from operations centres in India, Ukraine and Latvia sight and business understanding with technological expertise. to the group’s Nordic organisation account for some 40% of EVRY Sweden also delivers specialist services independent of total revenues for EVRY’s Global Sourcing businesses. The geographic location and sector based on strong specialist exper- remaining revenues relate to other customers, and this ensures tise, for example ERP solutions, mobility, cloud-based solutions that the Global Sourcing operations centres have a profitable and Business Intelligence. EVRY Sweden also has its own op- and scalable business model. erating services organisation, which focuses on medium-sized businesses and entities in the private and public sectors. The EVRY Norway segment generated EBITA of NOK 322 million in 2014, representing an EBITA margin of 5.3%. By comparison, The EVRY Sweden segment reported operating revenue of NOK EBITA for 2013 was NOK 359 million, representing an EBITA 3,472 million in 2014, representing organic growth in revenue of margin of 5.8%. 4% from 2013. At the end of 2014, the segment had 3,344 employees in its EBITA in 2014 was NOK 255 million, representing an EBITA mar- Norwegian activities and 3,103 employees in the global sourcing gin of 7.3%. EBITA for 2013 was NOK 213 million, with an EBITA companies. The comparable headcount figures at the end of margin of 6.5%. 2013 were 3,378 and 2,861 employees. From the Boardroom 39

The EVRY Norway segment's order backlog at 31 December 2014 social responsibility are set on an annual basis, and performance was NOK 7.1 billion, of which NOK 3.5 billion is due for delivery is measured through relevant key performance indicators (KPIs) in 2015. for environmental impact, working conditions and customer satisfaction. The company's executive management receives Organisation and working conditions regular reports on performance in these areas. EVRY ASA is a public limited company and the company’s head office is at Fornebu in Bærum. The executive management team Guidelines for business ethics and social responsibility had eight members in 2014 under the leadership of CEO Terje EVRY operates ethical guidelines in the form of a Code of Mjøs. Terje Mjøs resigned as CEO on 23 March 2015. Björn Ivroth Conduct. All employees receive training in these guidelines, and was appointed as the new CEO, and assumed the role from are required to confirm in writing that they have read and un- 24 March 2015. derstood the Code of Conduct. The Code of Conduct is reviewed annually, and a review was carried out in 2014. The group’s activities mainly take place through wholly owned companies in Norway, Sweden, Denmark and Finland. The The Code of Conduct places emphasis on how each employee group also operates businesses in Great Britain, India, Ukraine should relate to customers and business partners, and lays and Latvia. down guidelines for how to contribute to a good and inclusive working fellowship, ensure diversity and contribute to a good EVRY sees the Nordic region as its natural home market. The environmental standard. The Code of Conduct is available on the company operates from locations in 50 Nordic towns and cities, group’s website and through the group's internal communica- principally in Norway and Sweden, providing the expertise to tions channels. serve customers locally. The company is committed to operating with a decentralised organisation that is able to respond rapidly EVRY's Code of Conduct applies to the members of its Board of to customers, and has therefore ensured that decision-making Directors, its managers, its employees, consultants hired in on authority is delegated appropriately. The company considers it temporary contracts and everyone else who represents EVRY. very important to ensure that the local offices can draw upon These requirements apply similarly to the group's subsidiar- the expertise and strengths that the group as a whole rep- ies. Line managers are responsible for ensuring awareness of resents. This is achieved through appropriate organisational and the Code of Conduct and compliance with its requirements. reporting arrangements and a group-wide program, as well as Everyone employed by or associated with EVRY is required to through arrangements for marketing and customer relationship familiarise themselves with the Code of Conduct and comply management. In addition to its activities in the Nordic region, with its guidelines. EVRY has wholly owned companies in India and Ukraine that represent a major part of the company’s overall delivery cap External environment acity. In order to make the best possible use of this competence EVRY is committed to a continuous program of environmental base, these companies also have significant customer portfolios improvement. Greater energy efficiency through technological in addition to their deliveries to EVRY for its Nordic customers. development is an important contribution to a greener company, and benefits society as a whole. Systematic work is also The overall Nordic IT services market is estimated to be worth in progress on waste management, reduction of business travel around NOK 132 billion. Figures from the market research com- by using digital forms of interaction, procurement policy and pany IDC show that EVRY is currently the second largest vendor setting requirements for subcontractors and monitoring their in the Nordic IT services market, and is the clear market leader compliance. in Norway and the fourth largest vendor in the Swedish market. The group’s market share in Norway is estimated to 28% and a The company's environmental policy emphasises that EVRY is 7% share of the Swedish market. committed to being a pioneer in respecting the natural environment, both by minimizing its own environmental impact Corporate social responsibility and by developing, promoting and adopting environmentally EVRY's approach to corporate social responsibility is based on friendly technologies. EVRY recognises its duty to take into the principle that the company should operate with proper re- account the environmental effects that work-related activi- spect for people, the environment and society as a whole. In or- ties have on the environment, and to choose environmentally der to ensure that this is achieved to the greatest extent possible friendly solutions to the greatest extent possible. in all areas of the company, EVRY attaches great importance to developing a strong corporate culture, competent managers and EVRY constantly strives to reduce its own energy consumption reliable control processes. Specific targets relating to corporate to a minimum, but also recognises that the most important 40 From the Boardroom

contribution to reducing greenhouse gas emissions is to EVRY is becoming an increasingly global business, with oper- develop environmentally friendly solutions for the company's ations in countries such as India, Ukraine and Latvia. This has customers. Working in close collaboration with its customers made it necessary for EVRY to place additional emphasis on and partners, EVRY seeks to develop solutions that promote preventative measures in order to ensure that the entire value efficiency and reduce energy consumption in order to generate chain fully respects the human rights of its employees. energy savings far beyond its own operations. EVRY is in the process of consolidating its data centres. The new data centre Anti-corruption will use a completely new and innovative air cooling system that EVRY is committed to compliance with all applicable laws and extracts waste heat from the hardware. The Air cooling system, regulations, as well as ensuring compliance with all its internal combined with EVRY's use of modern low-energy servers, will rules, procedures and guidelines. Employees have a personal make this one of the most efficient and sustainable data centres responsibility to familiarize themselves and comply with the in the world. The efficiency of data centres is measured in PUE requirements set out in laws, regulations and guidelines, in- (Power Utilization Efficiency). While a traditional data centre cluding the requirements for accounting matters. typically has a PUE of 1.8 to 2, EVRY's new data centre will have a PUE factor of 1.1. This represents almost a 50% improvement EVRY applies a strict approach to accepting gifts or participat- from current levels. ing in other benefits or activities arranged by business partners in order to ensure at all times that its employees do not find EVRY produced a climate report in 2014 in accordance with themselves in a situation that may be interpreted as, or in fact the GHG Protocol guidelines, and participated in the Carbon amount to, corruption. The company has established guidelines Disclosure Project (CDP) for investors. This reporting gives for how individual employees should handle this type of situ- EVRY a good overview of important statistics in relation to envi- ation, and all employees have a duty to familiarize themselves ronmental and climate performance. In 2014, EVRY achieved for with the guidelines and to comply with them. the first time a rating of 'A' in the CDP's 'Climate Performance Leadership Index'. This rating is awarded to companies that In 2014, EVRY continued to implement an e-learning program demonstrate best practice through their measurement, open- for ethical standards throughout the Group. This e-learning ness and management initiative in relation to environmental program ("Reputation") is specifically customised for EVRY and and climate performance. deals with issues that are particularly relevant for the group and its employees. The course examines a number of ethical Human Rights issues such as accepting gifts, ethical challenges in negotiating EVRY supports international human rights as defined in the UN situations, racism and discrimination. All new employees are Universal Declaration of Human Rights and related conven- required to complete the e-learning program in addition to con- tions. No one shall in any way cause or contribute to breaches or firming in writing that they have read and understood the Code circumvention of human rights. The company places particular of Conduct. Newly appointed employees in Sweden and Norway emphasis on protecting the fundamental rights of employees, as also take part in an introductory training program on the first embodied in the ILO core conventions. day of work that includes training in compliance.

EVRY's commitment to respecting human rights starts with EVRY has a standard agreement for Supplier Conduct Principles understanding what this means in practice for EVRY and its that all suppliers are required to sign. This applies to existing as business partners. EVRY's Code of Practice for ethical guide- well as new suppliers, and has now been translated into a num- lines includes a clear statement of the company's responsibility ber of languages. EVRY asks all its major suppliers in Norway to promote basic human rights and its commitment not to to seek registration and certification through the Achilles pro- allow any breaches of human rights or the rights of employ- curement system, which also impose requirements for ethical ees, whether by the company itself or by its suppliers or other business conduct. business partners. EVRY has established "whistle-blower" arrangements using EVRY imposes strict requirements on its suppliers in order both internal channels and an external supplier. The external to reduce any risks that might be identified in the company's channel facilitates anonymous whistleblowing. The company supply chain. All suppliers are expected to live up to the same has established procedures to protect the interests of whis- high standards as EVRY applies in all areas related to social tle-blowers, regardless of whether they choose to be anony- responsibility and human rights, including discrimination and mous, and to ensure that their concerns are properly consid- child labour. ered. Whistle-blowers can notify their concerns either directly to EVRY's Group Compliance Officer by email to compliance@ From the Boardroom 41

evry.com or can make contact through the company's external falling to 2.9% in 2014 from 3.0% in 2013. Sick leave was 3.2% supplier (Advokatfirmaet Hestenes og Dramer & Co). EVRY in Norway and 2.4% in Sweden. By way of comparison, sick considers it extremely important that it is made aware of any leave in 2013 was 3.4% in Norway and 2.3% in Sweden. breaches of its ethical guidelines or of any other censurable matters affecting the group. The company accordingly strives to Span Systems and ION Solutions in India reported sick leave of ensure that employees are not deterred from whistleblowing by 1.3% in 2014, while Infopulse in Ukraine reported sick leave of any concerns about the possibility of personal consequences. 1.1%. The group's company in Latvia reported sick leave for 2014 of 4.5%. The Group Compliance Officer manages compliance activities in the group. In addition, the group has dedicated Compliance The figures for sick leave are not directly comparable between Managers in the major countries in which it operates, namely countries since there are considerable differences in the rules Sweden, India, Ukraine and Latvia. In addition to receiving that apply to sick leave. and investigating whistle-blower notifications, the Compliance Managers act as advisers and discussion parties for employees Measures were implemented in 2014 to improve the profes- in their country. The Compliance Managers produce quarterly sionalism of the company's management of sick leave. This reports for the Group Compliance Officer on the status of com- involved additional and better support for managers with direct pliance in their business area. assistance from the company health service at an early stage of individual employees' sick leave. These measures ensured an Working environment and employee satisfaction early response with good support for managers and employees The working environment in the group is regarded as good. This in terms of administrative assistance and technical support for is reflected by an employee satisfaction survey sent to 9,200 em- working environment and health-related issues. A programme ployees in Norway, Sweden, Denmark, Finland, Latvia, Ukraine of work on fire prevention was carried out in 2014, addressing and India. The response rate was excellent at 92.1%, which both organisational and premises-related prevention measures. demonstrates a strong involvement in the survey. On a scale The risk of serious injuries is considered to be extremely low. of 100, the employee satisfaction score in 2014 was unchanged from 2013 at 77. This is regarded as a very good result in light of Inclusive working environment the information about the possibility of a sale of the company. EVRY focuses on encouraging a working environment that is The survey also reported on satisfaction with management at free of discrimination, whether on grounds of religion, skin all levels. In total, the management index improved from 78 in colour, gender, sexual proclivity, age, national or ethnic origin 2013 to 79 in 2014, which is considered a very pleasing result. or functional disability.

Key topics for the employee satisfaction survey are working en- The Norwegian part of the group has entered into an agreement vironment, employee motivation, commitment, management, for “Inclusive Working Environment” to strengthen the focus reputation and engagement with EVRY’s corporate values. The on working environment programs and sickness absence, to results of the employee satisfaction survey lead to the inclusion contribute to employees remaining longer in work and to the of specific measures for improvement in EVRY's action plans. inclusion of the functionally disabled.

The company attaches great importance to ensuring that all The group collaborates with Telenor Open Mind and routinely managers carry out appraisal interviews with all their employ- offers work experience placements for individuals with ees, and that individual employees have annually updated plans disabilities. for training and personal development. Gender equality and demographics Absence due to sickness and accidents EVRY’s Nordic activities employ more than 1,600 women, mak- The company pays particular attention to health, safety and the ing it one of the largest IT workplaces for women in the Nordic working environment. The primary focus for its work in this countries. Women make up 23% of the group’s workforce in area is on preventative measures to keep sick leave at the lowest Norway and 28% in Sweden. Male and female employees have possible level, to avoid risks to life and health, to minimise equal access to all types of job role. The distribution of genders adverse effects on the environment and to prevent accidents is also reflected in management, where the proportions of and injuries. women are 22% in Norway and 28% in Sweden. EVRY operates established personnel guidelines designed to ensure that there is 2014 saw a further reduction from an already low level for sick no discrimination based on gender in matters such as sala- leave in the group's Nordic activities, with reported sick leave ries, promotion and recruitment. In the recruitment process, 42 From the Boardroom

emphasis is placed on attracting highly qualified employees of in connection with special assignments for customers, and both genders. internal projects for developing products and services. Personal targets and development plans for each employee are recorded At the end of 2014, EVRY’s executive management team totalled in the MyWork competence development system, together with eight persons, one of whom is a woman. information on the employee's technical expertise, experience and CV. The group has established separate career models for all The average salary earned by women was 93% of the aver- employees that are intended to ensure convergence between in- age salary for men, unchanged from the previous year. The dividual personal targets and the company's strategic objectives. somewhat lower salary reflects the fact that the average age, The use of this career model contributes to making employment and accordingly seniority, of women is somewhat lower than with the company attractive, and strengthens EVRY's position among men. In relation to the group's Norwegian activities, as an attractive workplace. parental leave was taken by 161 men and 61 women in 2014. EVRY received a substantial number of job applications in 2014, Gender equality statistics for the company's Norwegian activi- and surveys that measure the attractiveness of companies as ties are as follows: workplaces report that EVRY’s score as an attractive place to • Analysis by gender of employees: 23% female and 77% male work is on an upward trend. The Universum survey placed • Average salary: Female employees NOK 595,007 and male EVRY as the eighth most attractive employer in the IT industry employees NOK 636,015. for new graduates, and the 10th most attractive workplace in the IT industry for experienced professionals. The group’s employees have extensive experience, and their average age is 40. The average age of employees in Norway and The group endeavours to ensure that all new employees get Sweden is 46 and 43 respectively. the best possible start. An introduction course is held on the first Monday of each month for all new employees, at which Remuneration of executive personnel they receive a welcome package consisting of information and An overview of the remuneration of senior employees and practical equipment. officers of the group is provided in Note 7 to the consolidated accounts. Note 7 also provides an overview of the guidelines EVRY Academy for the compensation arrangements for senior employees. The EVRY took steps in 2014 to further emphasise its focus on Annual General Meeting endorsed these guidelines through an competence development. This took the form of designing advisory vote on 14 May 2014. and implementing a training academy for the entire group. The purpose of this initiative is to bring together all training Competence development and personal development activities for the entire group. It is As a knowledge-based enterprise, EVRY is committed to pro- hoped that the practical consequences will include creating viding its employees and managers with competitive opportu- better interaction between important commercial decisions nities for competence development and career development, and competence development, as well has increasing further which benefit both the company and the individual employee. the company's attractiveness as an employer. The new training This entails a planned, targeted and systematic process to academy, known as 'EVRY Academy' was formally launched develop the knowledge, skills and attitudes of the employees 3 March 2015. in accordance with the group’s objectives and strategies. This is achieved through daily work tasks, professional challeng- Corporate governance es, and specific programs and certification schemes to build The Board of EVRY is committed to sound corporate govern- expertise. EVRY's technical network plays a key role for sharing ment practices. experience and developing both competence and methodology throughout the company's areas of technical speciality. EVRY applies the Norwegian Code of Practice for Corporate Governance as issued in English translation on 23 October 2012 All employees develop individual plans for their targets, person- and revised on 21 December 2012. The company produces a al and professional development and certification as part of the comprehensive annual report on corporate governance as part program for regular employee appraisal interviews. Plans for of its annual report, and the information is also available on skills maintenance and ongoing competence development are www.evry.com. The company complies with the Norwegian also governed by mandatory requirements relating to quality, Code Practice for Corporate Governance, with no material devi- security and customer service, by technological develop- ations from the Code’s recommendations. ments and by market trends, as well as training requirements From the Boardroom 43

EVRY’s general corporate governance principles are based on management, the Board and the Audit Committee, and this maintaining open and reliable lines of communication, having involves reporting all important and critical risk exposure and a Board that is autonomous and independent of the group man- ensuring that the ownership of responsibility for the exposure agement, having a clear division of responsibility between the is identified. EVRY has established a risk management system Board and the executive management, and treating all share- in order to support the risk management process and ensure holders equally. Further information on the company’s cor- traceability and aggregation of various risk exposures. In porate bodies and their function and work can be found in the addition to producing aggregated risk reporting, this system Corporate Governance report on page 28 of this annual report. provides detailed information on vulnerabilities, identifying the risks affected and which measures the organisation has Risk exposure and risk management implemented to reduce unacceptable risk exposure. This helps EVRY’s overall objective in its risk management is to identi- line management to follow up on the status of measures that fy and quantify risks in order to provide a basis for decision have been implemented, with ready access to information on making. In addition, risk management forms part of the process prioritised tasks. of value creation by ensuring that risk exposure is taken into account in the company’s decision processes as well as ensuring Market risk compliance with relevant legislation and regulations. EVRY has established a strategy to manage its exposure to currency and interest rate risks arising from its international Risk management is an integrated part of the company’s man- investments. The strategy is designed to ensure a high degree agement model and of its financial reporting, and the key areas of predictability and the lowest possible volatility in annual of risk that the business units consider to be material are moni- currency gains/losses and interest costs. tored as part of the executive management’s routine supervision of the business areas and key financial metrics. In operational EVRY is principally exposed to two types of currency risk: terms, the company’s objective is to integrate systematic risk contractual purchases or sales denominated in foreign curren- management into the group’s business processes as well as sup- cy, and foreign investments and future cash flows from these porting our customers in the risk management they carry out in investments. Foreign investments are hedged by arranging relation to their value chains. financing in the same currency as the investment, and at the end of 2014, the group had a loan of SEK 1,200 million in place EVRY has structured and organised its approach to risk manage- to hedge its investments in Sweden. ment through an Enterprise Risk Process (ERM). This process embeds risk management into business activities as a normal Interest rate risk is managed by the use of financial hedging and routine part of activities at every level in EVRY. EVRY’s ERM instruments such as interest rate swaps and by managing the process ensures a shared understanding of the concept of risk, balance of fixed rate and floating interest rate borrowings, with defines a group-wide methodology for identifying, assessing, a weighted average interest rate fixing period between 1.5 and managing and monitoring risks, and also stipulates risk accep- 4.0 years. As part of the Group’s Finance Policy, between 50% tance criteria and limits for the level of permitted risk exposure. and 70% of long-term borrowings are to be on fixed interest rate terms. In a normal situation, the group’s short-term Risk management includes all categories of risks such as borrowing should not exceed NOK 300 million in addition to strategic risk, financial risk, reputational risk, operational the overdraft facility. risk, technical risk and compliance risk. EVRY is committed to making risk management an integrated part of its corporate Note 5 to the consolidated accounts provides more detailed culture by using risk management to support all critical busi- information on interest rate hedging instruments, together ness processes. with sensitivity analysis of exposure to currency and interest rate movements. EVRY bases its ERM process on ISO31000:2009 when optimising activities to carry out risk assessment. Risk assessment is the The company follows the political situation in Ukraineclosely overall process of identifying, analysing and evaluating risk. The and takes the measures required to ensure the safety of its results of risk assessment are managed by the organisational employees. The political situation has, however, had only a structure, with risk exposure ‘owned’ in accordance with the limited effect on the financial results reported by the Ukrainian appropriate legal structure. operations for 2014. The Ukrainian authorities have ceased to allow money to be taken out of the country, which has made it EVRY operates established risk reporting procedures for impossible to use the liquid assets held by the Ukrainian compa- the appropriate management groups to report to executive ny freely in the group. 44 From the Boardroom

Credit risk economic trends must be expected to have some impact on The group’s total exposure to credit risk at 31 December 2014 the growth rate of the IT services market in 2015. The Swedish was NOK 2,169 million. This includes accounts receivable and economy is currently highly dependent on domestic demand. other receivables, excluding prepaid expenses and receivables Weak growth in demand from the Eurozone is a headwind to due from government bodies. The group’s exposure to counter- growth, but, with continued demand in the retail and services party risk is moderated by the fact that it has a large number of sector, GDP growth is expected to increase slightly in 2015. customers and its major customers are judged to be very strong companies. Losses on receivables recognised to profit and loss in The most recent survey conducted by the Swedish National 2014 totalled NOK 2.6 million, unchanged from 2013, which is Institute of Economic Research recorded an increase in business considered to be at a low level. confidence in Sweden relative to the end of 2014, with businesses slightly more positive than in previous months. This im- Liquidity risk provement was driven by businesses active in the construction, EVRY generated positive cash flow in aggregate from operations retail and service industries. In contrast, the manufacturing and investment activities in 2014, and held liquid assets of NOK industry was slightly less positive. 616 million at the close of the year, as well as having access to un-drawn credit facilities of NOK 1,798 million. The company EVRY expects to see continued moderate growth in the IT holds its liquid assets in the form of bank deposits in a group services market in Norway in 2015. It is becoming increasing- account system with DNB, and its exposure to liquidity risk is ly recognised that IT is the most important source of growth considered to be very limited. in most business sectors, and is a central means of meeting efficiency challenges in the public sector. Cloud services are The company entered into new financing arrangements on growing at a significantly higher percentage rate than other seg- 17 March 2015 with a syndicate of banks with Wilmington Trust ments of the market, and EVRY has recognised two underlying (London) Limited as agent and Bank of America Merrill Lynch situations that are driving this growth. One is that customers International Limited, Credit Suisse AG, London Branch, DNB looking to invest in new IT equipment are increasingly choosing Bank ASA, Mizuho Bank Limited and Nordea Bank Norge ASA as to purchase services instead. The other is that, when busi- arrangers. The new financing consists of various tranches in an nesses introduce mobile solutions for customers and partners, aggregate frame of NOK 5.5 billion, with maturity profiles of six the flexibility and scalability with which the information and and seven years. The new financing ensures that EVRY achieves systems involved need to be made available can be provided financial headroom at market rates with initial margins in the more cost-efficiently if cloud services are used rather traditional range of 4 to 5%, with the possibility of reduction given compa- infrastructures. ny performance. The covenants include requirements for cash interest cover ratio (EBITDA to net financial charges) to be above EVRY is seeing demand trends continue in line with previous a range of 3.00:1 to 3.40:1 until 2020 and above 3.40:1 thereaf- quarters in the consulting services market. Generic expertise ter, and for leverage ratio (net interest bearing debt to EBITDA) is susceptible to pressure on prices, but good hourly charge to be below a range from 5.20:1 to 3.10:1 until 2020 and below out rates are being seen for specialist expertise in leading-edge 3.10:1 thereafter. The first measuring point is 31 March 2016. technologies such as mobility and cloud services, and also for industry-specific expertise in particular. These trends are pres- Company outlook ent in Norway and Sweden alike, but regional market-related The International Money Fund (IMF) has slightly lowered its challenges are having an effect on EVRY’s consulting business forecast for global economic growth in 2015-16 on account of a in these markets. The bank and finance market in Norway and weaker outlook for growth in all markets other than the USA. Sweden continues to stand out as a strong market for EVRY, and The impulses for growth stemming from the sharp fall in the with a good inflow of new contracts during the last quarter of price of oil are not sufficient to counteract the generally dimin- 2014 the outlook for continued growth in consulting services is ished expectations globally. good for 2015. The operating services market for medium-sized businesses in Norway and Sweden is characterised by the trend In Norway, growth fell during the second half of the year, and for purchasing services rather than IT equipment. EVRY’s the sharp decline in the oil price seen in the autumn will in- product offering adapted for this market segment has been well tensify the fall in petroleum investment going forward. Norges received and is attracting strong demand, and is producing good Bank and Statistics Norway have both predicted further weak- growth. The large-customer market is largely defined by global ness in growth in 2015. This is supported by the Confederation competition, with pressure on prices and a transition from of Norwegian Enterprise’s member firms, who expect to traditional operating services to cloud-based delivery models. see lower economic activity in the coming quarters. These This is resulting in steadily falling unit prices that are to a large From the Boardroom 45

extent compensated for by volume growth in customers’ use of As communicated by a stock exchange announcement on operating services, and this is reflected in flat revenue growth. 8 December 2014, Lyngen Bidco AS, a company indirectly controlled by private equity funds managed by Apax Partners LLP, The outlook for 2015 is cautiously positive when put in context launched a voluntary bid for the entire share capital of EVRY of the weaker growth that was seen in the fourth quarter of ASA at a price of NOK 16 per share. Following the end of the 2014, particularly in Norway. The pressure on prices for con- offer period, Lyngen Bidco AS acquired 234,797,184 shares in sulting services and for basic operating services is expected to EVRY ASA, equivalent to ~88% of the total share capital. continue, and there is somewhat greater uncertainty over the demand for consulting services in weaker regions, but capacity Allocation of the result for the year adjustments were carried out during the fourth quarter of 2014. The parent company recorded a loss for the year of NOK 83 EVRY has taken steps over recent years to adapt and specialise million in 2014, which is allocated against other equity. its activities for selected industries, and has at the same time strengthened its solutions expertise in the most sought-after The company’s dividend policy is to distribute a dividend equiv- areas of technology. Similarly, its local presence in attractive alent to 20-50% of the group’s normalised profit. Extraordinary regions is strengthened by its regional teams of experts who are dividends may be distributed in particular circumstances, and responsible for further developing specific solutions areas and will be evaluated on a case-by-case basis. delivery models independently of geographical location. Our expertise and solutions are specialised to address high-demand In connection with the process whereby Lyngen Bidco AS and high-willingness-to-pay markets in which global suppliers has acquired 88% of the share capital of EVRY ASA, an are less active. Extraordinary General Meeting held on 23 March 2015 approved an extraordinary dividend of NOK 3.76 per share, equivalent to Shareholder information NOK 1,005 million. Posten Norge AS (Norway Post) was the largest shareholder in the company at 31 December 2014 with 40.0% of the shares, No dividend is proposed in respect of the 2014 financial year. followed by Telenor Business Partner Invest AS with 30.2%. The shareholder structure was otherwise dominated by The group has prepared its accounts on the going concern Norwegian institutional investors, and the share of foreign assumption, and the Board confirms in accordance with Section investors was 11.4% at the end of 2014. The number of share- 3-3 of the Norwegian Accounting Act that the going concern holders at 31 December 2014 was 3,298. See also Note 20 to the assumption is applicable. The group’s reported results, its busi- consolidated accounts. ness strategy and its current budgets and financing provide the basis for the going concern assumption.

Bærum, 21 April 2015, Board of Directors of EVRY ASA

Jo Lunder Salim Nathoo Ellen de Kreij Louise Sondergaard Rohan Haldea Zehavit Cohen Chairman of the Board Deputy Chairman

Göran Lindahl Jan Dahlström Eirik Bornø Ola Hugo Jordhøy Ingrid Lund Björn Ivroth Chief Executive Officer 46 From the Boardroom

Statement from the Board of Directors and CEO

We hereby confirm that, to the best of our knowledge, the annual accounts for the group and the parent company for the period 1 January to 31 December 2014 have been prepared in accordance with the IFRS, the Norwegian Accounting Act and Norwegian accounting standards, and that the information in the annual accounts and notes to the accounts gives a true and fair view of the group’s and the parent’s company’s assets, liabilities, financial position and earnings taken as a whole at 31 December 2014, and that the annual report of the group and the parent company give a true and fair view of developments, earnings, financial position and the principle risk and uncertainty factors facing the company and the group.

Bærum, 21 April 2015, Board of Directors of EVRY ASA

Jo Lunder Salim Nathoo Ellen de Kreij Louise Sondergaard Rohan Haldea Zehavit Cohen Chairman of the Board Deputy Chairman

Göran Lindahl Jan Dahlström Eirik Bornø Ola Hugo Jordhøy Ingrid Lund Björn Ivroth Chief Executive Officer 47

Annual accounts and notes

Annual Accounts Group 50 24 Classification of financial instruments and determination of fair value 92

Consolidated Statement of comprehensive income 50 25 Discontinued Operations 94

Consolidated Statement of financial position 51 26 Related parties 94

Consolidated Statement of cash flow 52 27 Disputes and other legal matters 95

Consolidated Statement of changes in equity 53 28 Events after balance sheet date 95

Notes Group 54 Annual Accounts EVRY ASA 96

1 Accounting principles 54 Statement of comprehensive Income 96

2 Changes in group structure 63 Statement of financial position 97

3 Segment information 64 Statement of cash flow 98

4 Management of capital structure and financial risk 66 Statement of changes in equity 99 5 Financial instruments 68

6 Use of estimates 71 Notes EVRY ASA 100

7 Salaries and personnel costs 72 1 Accounting principles 100

8 Pensions 75 2 Salaries and personnel costs 100

9 Employee share based schemes 79 3 Pensions 100

10 Cost of goods sold and other operating costs 79 4 Income from investment in subsidiaries 101

11 Financial items 80 5 Other operating costs 102

12 Tax 81 6 Financial items 102

13 Earnings per share 82 7 Tax 102

14 Intangible assets 83 8 Guarantees issued and contractual commitments 103

15 Property, plant and equipment 84 9 Interests in subsidiaries 104

16 Interests in subsidiaries, associated companies 10 Intra-group accounts receivable and liabilities 104 and joint ventures 85 11 Share capital, shareholders etc. 104 17 Accounts receivable 87 12 Non-current interest bearing liabilities 105 18 Other receivables 87 13 Related parties 105 19 Bank deposits/guarantee liabilities 88 20 Share capital, shareholders etc. 88 Auditor’s report 106 21 Other current liabilities 90

22 Provisions 90

23 Leasing contracts 91 50 Annual Accounts Group

GROUP Consolidated Statement of comprehensive income 1 January - 31 December

NOK million Note 2014 2013 1)

Total operating revenue 3 12 773.1 12 600.2

Cost of goods sold 10 3 625.4 3 784.8 Salaries and personnel costs 7,8,9 6 448.7 6 009.2 Depreciation and write-down of tangible assets and in-house developed software 14,15,23 477.0 454.8 Other operating costs 10 1 679.4 1 678.8 Total operating costs 12 230.5 11 927.5

Operating profit before depreciation and write-down of intangible assets 542.6 672.7 Depreciation of intangible assets 14 33.5 32.9 Write-down of intangible assets 14 1 164.3 529.6 Operating profit -655.2 110.2

Financial income 11,16 38.7 9.9 Financial expenses 11,16 185.1 189.0 Net foreign exchange gain 11 59.0 9.7 Net financial items -87.4 -169.4

Profit before tax from continuing operations -742.6 -59.2

Tax on profit 12 85.9 -7.5 Profit for the year from continuing operations -828.5 -51.7

Discontinued operations Profit/(loss) after tax for the year from discontinued operations 25 -42.3 -25.9

Profit for the year -870.8 -77.6

Comprehensive income Items which will not be reclassified over profit and loss (after tax) Actuarial gains (losses) on defined benefit pension plans -46.0 -102.6

Items which may be reclassified over profit and loss in subsequent periods (after tax) Cash flow hedges -40.5 11.3 Currency translation differences -6.2 154.1 Total comprehensive income 12 -92.7 62.8

Total profit for the year -963.4 -14.8

Profit for the year are allocated as follows Owners of the parent -871.1 -77.6 Non-controlling interests 0.3 -

Total profit for the year are allocated as follows: Owners of the parent -963.8 -14.8 Non-controlling interests 0.3 -

Earnings per share Earnings per share (NOK) 13 -3.26 -0.29

1) Restated Annual Accounts Group 51

GROUP Consolidated Statement of financial position As of 31 December

NOK million Note 31.12.2014 31.12.2013 1)

Non-current assets Goodwill 14 5 446.0 6 584.7 Deferred tax assets 12 3.7 3.6 Other intangible assets 14 545.5 507.4 Total intangible assets 5 995.2 7 095.7

Land, buildings and other real estate 15 50.1 67.5 Machinery, equipment and fixtures 15,23 785.4 900.8 Total tangible assets 835.5 968.3

Investment in associated companies and joint ventures 16 67.5 61.5 Other shareholdings 1.5 1.6 Other non-current receivables 18 206.6 143.3 Total non-current financial assets 275.7 206.4 Total non-current assets 7 106.5 8 270.4

Current assets Inventories 39.2 38.1 Accounts receivable 17 1 966.3 1 956.8 Other current receivables 18,22 975.2 1 172.7 Bank deposits 5,19 615.6 558.0 Total current assets 3 596.3 3 725.6 Total assets 24 10 702.7 11 996.0

Equity Paid-in capital Share capital 20 467.8 467.8 Own shares 20 -0.5 -0.7 Other paid-in capital 3 369.4 3 368.7 Total paid-in capital 3 836.7 3 835.9

Other equity 440.4 1 510.5 Total other equity 440.4 1 510.5

Non-controlling interests 0.3 - Total equity and non-controlling interests 4 277.4 5 346.4

Liabilities Non-current interest bearing liabilities 4,5 3 181.3 3 520.7 Non-current non-interest bearing liabilities 5 80.6 77.7 Pension liabilities 8 242.1 186.5 Deferred tax 12 23.5 21.0 Other provisions for liabilities 22 8.2 14.7 Total non-current liabilities 3 535.7 3 820.7

Accounts payable 885.1 917.7 Tax payable 12 55.7 39.8 Deductions and duties payable 1 187.1 1 186.9 Other current liabilities 21,22,23 761.7 684.6 Total current liabilities 2 889.6 2 829.0 Total liabilities 6 425.3 6 649.7 Total equity and liabilities 10 702.7 11 996.0

1) Restated Bærum, 21 April 2015, Board of Directors of EVRY ASA

Jo Lunder Salim Nathoo Ellen de Kreij Louise Sondergaard Rohan Haldea Zehavit Cohen Chairman of the Board Deputy Chairman

Göran Lindahl Jan Dahlström Eirik Bornø Ola Hugo Jordhøy Ingrid Lund Björn Ivroth Chief Executive Officer 52 Annual Accounts Group

GROUP Consolidated Statement of cash flow 1 January - 31 December

NOK million Note 2014 2013

Cash from/to operations: Profit before tax 782.1 -85.1 Tax paid in the period -63.0 -44.9 Depreciation/write-down 14,15 1 684.4 1 031.6 Net financial Items 11 73.1 169.0 Paid interests -144.1 -175.4 Difference between pension cost and payments -1.9 -60.6 Change in working capital 206.6 191.9 Net cash flow from operations 973.0 1 026.5

Cash from/to investments: Investment in tangible assets 15 -397.7 -481.6 Investment in in-house developed software 14 -93.0 -142.6 Sale of tangible assets 15 75.2 - Investment in group companies -48.6 -55.4 Net cash flow from investments -464.0 -679.6

Cash from/to financing: New borrowing (current and non-current) 400.0 588.1 Borrowings repaid -754.2 -736.7 Dividends paid -106.8 -93.3 Purchase / sale of own shares 20 - -3.1 Net cash flow from financing -461.0 -244.9

Net change in liquid assets over the year 47.9 82.2 Currency movement in liquid assets 9.8 40.2 Bank deposits at 1.1. 558.0 415.7 Bank deposits at 31.12. 615.7 558.0

Whereof restricted cash 31.12 - 43.6 Annual Accounts Group 53

GROUP Consolidated Statement of changes in equity 1 January - 31 December

Owners of the parent

Paid-in Fair Non- Share Own other value Translation controlling Total NOK million capital shares equity reserves Other equity differences Total interets equity

Equity at 1 January 2013 467.8 -1.2 3 366.4 -68.4 1 712.2 -25.3 5 451.5 - 5 451.5

Purchase of own shares 0.5 2.3 2.9 - 2.9 Dividend -93.3 -93.3 - -93.3 Comprehensive income 11.3 -102.6 154.1 62.8 - 62.8 Profit for the year 2013 -77.6 -77.6 - -77.6 Equity at 31 December 2013 467.8 -0.7 3 368.7 -57.1 1 438.7 128.8 5 346.4 - 5 346.4

Purchase of own shares 0.1 0.7 0.5 1.3 - 1.3 Dividend -106.8 -106.8 - -106.8 Comprehensive income -40.5 -46.0 -6.2 -92.7 - -92.7 Profit for the year 2014 -871.1 -871.1 0.3 -870.8 Equity at 31 December 2014 467.8 -0.5 3 369.4 -97.6 415.3 122.6 4 277.1 0.3 4 277.4 54 Annual Accounts Group

GROUP Notes to Financial Accounts

Note 1 Accounting principles

1. General information EVRY ASA is a Norwegian public limited company, and is subject to the Public Limited Liability Companies Act. The company’s registered office is at Snarøyveien 30A, NO- 1331 Fornebu. The company is listed on the Oslo Stock Exchange (“Oslo Børs”) under the ticker EVRY.

The main activities of the parent company EVRY ASA and its subsidiaries (the ‘group’) are the sale of software, IT solutions and consulting services, as well as the centralised and decentralised operation of computer systems. In addition, the group offers outsourcing services and services related to data communication, data security and electronic publishing.

The consolidated accounts have been approved for issuance by the Board of Directors on 21 April 2015 and is subject to approval by the Annual General Meeting on 26 May 2015.

2. Significant accounting policies 2.1 Basis of presentation In accordance with the Norwegian Accounting Act, the consolidated Annual Accounts EVRY ASA have been prepared in accordance with the International Financial Reporting Standards (IFRS) as published by IASB and approved by the EU. The accounts have been prepared on a historical cost basis with the exception of financial derivatives and share based investments, which are measured at fair value.

The group’s business is, for internal reporting requirements, divided into three strategic segments, each of which is separately organised and managed. Financial information about the segments and geographic areas of activity is presented in note 3: Segment information.

In preparing the accounts for the 2014 financial year, the group has implemented all the new and revised standards and interpretations issued by IASB and approved by the EU that are relevant to its activities and that were in force for the accounting year commencing on January 1 2014. A review of the standards and interpretations that had not come into force for the 2014 financial year but that may be relevant for the group is provided at the end of the statement of accounting principles.

The accounting principles applied are consistent with the principles applied in the previous approved consolidated accounts. In 2014, the group implemented the following new standards and interpretations issued by the IASB and approved by the EU that are relevant for its business activities and that came into force for the accounting year that commenced on 1 January 2014

• IFRS 10 – Consolidated Financial Statements • IFRS 11 - Joint Arrangements • IFRS 12 - Disclosure of Interests in Other Entities • IAS 27 Revised: Separate Financial Statements • IAS 28 Revised: Investments in Associates and Joint Ventures • IAS 32 - Amendment: Offsetting Financial Assets and inancialF Liabilities

The implementation of the standards has not caused any changes to the accounting principles applied except for the implementation of IFRS 11. The implementation of IFRS 11 has caused a change in the accounting recognition of the group’s 50% interest in Buypass AS with effect from 1 January 2014 whereby the interest is now recognised in accordance with the equity method rather than on the basis of proportional consolidation. The table below shows the effects of the implementation of IFRS 11 on the figures reported for 2013:

Statement of financial position

NOK million Per 31.12.2013

Non-current assets 53 Other current assets -28 Bank deposits -125

Equity - Non-current liabilities - Current liabilities -100 Annual Accounts Group 55

Income statement

NOK million 2013

Operating revenues -79 Operating costs 74 Operating profit -5

The group did not elect early adoption of any standards or interpretations for the accounting year 2014.

It has been decided that the operations of EVRY Denmark A/S would undergo controlled closure. Because of this, the operating result for the company has been stated separately in accordance with IFRS 5 and is shown as a separate line entry in the income statement: “Profit after tax from discontinued operations”. The comparable figures in the income statement are restated accordingly. The figures in the statement of financial position and cash flow are not restated. See note 25 to the consolidated accounts for further information.

2.2 Basis for consolidation The consolidated accounts include the parent company EVRY ASA and its subsidiaries as of 31 December 2014. Control is achieved when the group is exposed or has rights, to variable returns from its involvement with the company and has the ability to affect those returns through its power over the company. Specifically, the Group controls a company if, and only if, the Group has: a) Power over the company (i.e., existing rights that give it the current ability to direct the relevant activities of the investee) b) Exposure, or rights, to variable returns from its involvement with the company c) The ability to use its power over the company to affect its returns

Generally, there is a presumption that a majority of voting rights result in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including: a) The contractual arrangement with the other vote holders of the company b) Rights arising from other contractual arrangements c) The Group’s voting rights and potential otingv rights

Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. If the group ceases to have a controlling influence over a subsidiary, the subsidiary’s assets, liabilities, non-controlling ownership interests and any accrued translation differences are reversed. The remaining investment at the time that the group ceased to have a controlling influence is measured at fair value, and any gain or loss is recognised in the accounts.

The group’s comprehensive income is attributed to the parent company’s owners and to the non-controlling interests, even where this causes non-controlling interests to be negative. At the time of acquisition, non-controlling ownership interests are calculated either as their portion of identified assets or to fair value. The choice of method is made at the date of acquisition for each business combination. The share of profits is calculated on the basis of the subsidiary’s post-tax profit, as included in the consolidated accounts after internal netting.

All intra-group transactions and balances, purchases and sales between companies in the group and unrealised internal gains are netted off in the accounts.

2.3 Summary of significant accounting policies The material accounting principles used to prepare the annual accounts of EVRY ASA are as follows:

Presentation and functional currency The group presents its accounts in Norwegian kroner (NOK). This is also EVRY ASA’s functional currency. The figures presented in the annual accounts are in millions of Norwegian kroner unless otherwise stated. Rounding differences may mean that amounts and percentages reported do not necessarily add up to the total shown.

Business combination and goodwill Subsidiaries are accounted for in accordance with the acquisition method, whereby the acquisition cost of the shares is offset against the subsidiary’s equity at acquisition date. Any excess value resulting from this treatment at the time of purchase is allocated to identifiable assets and is depreciated over their expected life. Excess value that 56 Annual Accounts Group

cannot be attributed to identifiable assets and liabilities in subsidiaries at the date of acquisition is recognised as goodwill in the statement of financial position. Goodwill acquired in a business combination represents a payment made by the acquirer in anticipation of future economic benefits from assets that are not capable of being individually identified and separately recognised.

Goodwill that arises as a result of a business combination is not amortised. Goodwill does not generate cash flows independently of other assets or groups of assets, and is assigned to the cash generating units that are expected to benefit from the synergy effects of the business combination that gave rise to the goodwill. Upon disposal of a business, the businesses proportion of goodwill based on fair value is taken into account in calculating the gain or loss on disposal.

The group carries out goodwill impairment tests as required if there are any indications that suggest this is necessary, and in any case at least at the end of each year. If there are such indications, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Recoverable amount is defined as the higher of value in use and net sales value. Value in use is calculated as net present value of future cash flow from continuing use, including cash flow arising from eventual disposal. A calculated WACC is applied as the discount rate used to calculate present value. Net sales value is calculated as the amount that the company would expect to obtain from the disposal of an asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the estimated costs of disposal.

The smallest unit of a particular asset which can be separately assessed as a valuation unit for the purpose of determining whether there has been a fall in value is determined by the lowest level at which it is possible to identify incoming cash flow independent of cash flow from other groupings of the same class of asset. In most cases, the group’s business areas represent the smallest valuation unit for this purpose.

An asset is written down to the recoverable amount if the recoverable amount is less than the carrying value before write-down. The write-down is applied first to any goodwill and thereafter to the book value of the unit’s other assets on a proportional basis relative to the book value of the unit’s specific assets. Impairment losses are charged to profit and loss in the period the impairment loss is identified, and reduce the carrying value of the asset by an equivalent amount. Impairment of goodwill, may not subsequently be reversed, even though the reason for the impairment loss no longer applies.

Investments in associated companies and joint venture An associate company is a company over whose financial and operating policy decisions the group has significant influence. Significant influence is normally deemed to exist where one entity has an ownership interest in another of between 20% and 50%.

A joint venture is a joint arrangement in which the parties who have joint control over the arrangement have rights to the net assets of the arrangement. ‘Joint control’ is the contractually agreed sharing of control over a joint arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.

The group’s investments in associate companies and joint ventures are recognised in the group’s accounts using the equity method. When the equity method is used, the investment in the associate company or joint venture is recorded at cost, and the carrying amount is increased or decreased to recognise the group’s share of the profit or loss after the date of acquisition. The group’s share of the profit or loss of the company in which it has invested is recognised in the consolidated income statement. Distributions received by the group reduce the carrying amount of the investment. Goodwill is included in the cost price of investments in associate companies or joint ventures.

Transactions in foreign currency Transactions in foreign currencies are translated at the exchange rate at the date of the transaction. Currency gains/ losses that arise as a result of changes in the exchange rate between the date of the transaction and the payment date are recognised to profit and loss.

Assets and liabilities of foreign subsidiaries that use a functional currency other than Norwegian kroner are translated on the accounting period date at the exchange rate on the accounting period date, while profit and loss items are translated at the daily average exchange rate during the accounting period.

Upon disposal of a foreign subsidiary, the cumulative translation difference in respect of the subsidiary is recognised to profit and loss. If part of a receivable/liability that is treated as part of net investment in a foreign unit is realised, a proportionate share of the cumulative translation difference is recognised to profit and loss. Annual Accounts Group 57

Recognition of revenue and costs Where operating services are provided through volume-based contracts, revenue is recognised on the basis of the actual use of services by the customer, or on a linear basis over the period of the contract for term-based contracts. Sales of dialogue services are recognised as revenue on the basis of actual customer usage. Revenue from a transition project that is an integral part of a subsequent operating services contract is recognised on a linear basis over the period of the operating services contract. Revenue from a transition project that is not related to an operating services contract is recognised on the basis of the degree of completion. The degree of completion is calculated on the basis of the number of hours of work delivered to date divided by the total number of hours estimated for the delivery in total.

Revenue from service and maintenance agreements, as well as the expenses involved in carrying out such agreements, is recognised in the accounts over the period of the contract.

Sales of goods are recognised as revenue at the time of delivery, i.e. when control passes to the purchaser. Goods include both hardware and software.

Sales of licences and rights to use software are recognised at the date the contract is signed since this corresponds to the time at which the software is made available to and can be used by the customer. Revenue from sales of software is separated from maintenance revenue on the basis of a separate pricing model and contractual structure. Revenue from software developed specifically for customers is recognised over the development period in line with the degree of completion. The degree of completion is calculated on the basis of the number of hours of work delivered to date divided by the total number of hours estimated for the delivery in total.

Revenue from consulting services is recognised as the services are provided. Sales of services on a fixed fee basis are recognised in line with the degree of completion. The degree of completion is calculated on the basis of the number of hours of work delivered to date divided by the total number of hours estimated for the delivery in total.

Cost of goods sold comprises directly allocated costs related to the delivery of goods, including maintenance and operational leasing of hardware and software, as well as the cost of consulting services that are directly related to the turnover of the goods. The costs of employing external consultants that are used for the group’s normal operations and that are re-charged to customers are classified as cost of goods sold.

Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the respective asset. Borrowing costs consist of interest and loan set-up fees that are incurred in connection with the borrowing of funds.

Borrowing costs that cannot be directly attributed to the acquisition, construction or production of an asset are charged to profit and loss as interest expenses in the current period.

Taxation The tax charge is made up of tax payable and changes in deferred tax liabilities/deferred tax assets. With the exception of associated companies where the exemption method is applied, the value of deferred tax liabilities/deferred tax assets in the statement of financial position is calculated on the basis of all differences between accounting and taxation values of assets and liabilities (liability method). The amount provided includes all types of difference, and is calculated without being discounted to present value. Deferred tax liabilities and deferred tax assets are calculated based on approved tax rates at the time of reporting and netted to the extent that temporary timing differences can be reversed under the same tax system.

Deferred tax asset is capitalised in the statement of financial position to the extent that it is considered likely that the company in question will have sufficient taxable profit in subsequent periods to make use of the deferred tax asset. At each year end, the group carries out a review of deferred tax asset not capitalised to the statement of financial position and their accounting value. Deferred tax asset not previously capitalised to the statement of financial position is capitalised to the extent that it appears likely from the review that the company in question will be able to make use of the deferred tax asset. Similarly, companies will reduce the capitalised value of deferred tax asset to the extent that they are no longer able to use the tax asset in question.

Tax payable and deferred tax liabilities/deferred tax assets are applied directly to equity to the extent that they relate to items that are applied directly to equity. Items that are reported as “comprehensive income” are presented on a post-tax basis in the statement of comprehensive income. 58 Annual Accounts Group

Earnings per share Earnings per share is calculated by dividing the parent company shareholders’ share of the profit/loss for the year by the weighted average number of ordinary shares outstanding over the course of the period. When calculating diluted earnings per share, the average number of shares outstanding is adjusted for all share options that have a potential dilutive effect. Options that have a dilutive effect are treated as shares from the date they are issued.

Classification of current and non-current items The Group presents assets and liabilities in statement of financial position based on current/non-current classification. An asset as current when it is:

a) Expected to be realised or intended to sold or consumed in normal operating cycle b) Held primarily for the purpose of trading c) Expected to be realised within twelve months after the reporting period, or d) Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period

All other assets are classified as non-current.

A liability is current when:

a) It is expected to be settled in normal operating cycle b) It is held primarily for the purpose of trading c) It is due to be settled within twelve months after the reporting period, or d) There is no unconditional right to defer the settlement of the liability orf at least twelve months after the reporting period

The Group classifies all other liabilities as non-current.

Intangible assets with limited life The group’s intangible assets with limited life largely consist of capitalised costs related to software developed in-house.

Expenses relating to development are capitalised if the following criteria are met in full

- the product or process is clearly defined and its cost elements can be identified and measured reliably - the technical solution for the product has been demonstrated - the product or process will be sold or used in the company’s operations - the asset will generate future economic benefit; and - sufficient technical, financial and other resources for completing the project are present.

When all the above criteria are met, the costs relating to development are capitalised. Costs that have been charged as expenses in previous accounting periods are not capitalised. The evaluation of future commercial benefit is based on the expected license revenue and/or reduction in operating costs that will be achieved by carrying out the project. When calculating the profitability of a project, the estimated future cash flows associated with the project are discounted to present value using a rate of return adjusted for the risk associated with the project in question.

Intangible assets with limited life are amortised over their useful life. Capitalised development costs are normally depreciated based on expected cash flow from the individual project. The depreciation period used is between 1-4 years. Investment in other intangible assets is normally depreciated on a linear basis. The length of useful life remaining and the method of depreciation are subject to annual review that takes into account the commercial reality of the intangible asset in question. The group does not have any intangible assets with unlimited life.

At each reporting date the group evaluates if there are identified indications that fixed assets or intangible assets may be impaired. If there are such indications, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Impairment losses may subsequently be reversed to the extent that the reason for the impairment no longer applies.

Tangible assets Tangible operating assets are carried in the statement of financial position at historic purchase price less accumulated ordinary depreciation and write-down. When tangible operational assets cease to be used, the historic purchase price and accumulated depreciation are removed from the accounts, and any gain or loss this causes is recognised to profit and loss. Depreciation is applied on a straight-line basis, after allowing for disposal value, over the following time periods: Annual Accounts Group 59

- Leasehold improvements 5-10 years - Machinery/equipment/fixtures 3–7 years - Vehicles 5 years - IT equipment 3–5 years

The economic life and depreciation method used are reviewed regularly to ensure that the method and depreciation period reflect the expected useful life of the assets in question. This also applies to disposal value. The depreciation period for leasehold improvements will at a maximum be the remaining lease period.

Leasing Leasing of assets where the lessor retains the major part of risk and control are classified as operational leases. Other leasing contracts are treated as financial leasing.

Operational leasing The leasing costs of operational leases are allocated on a linear basis over the period of the lease, and are classified as cost of goods sold or other operating costs in the profit and loss account.

Financial leasing Financial leasing contracts are capitalised as assets and liabilities in the statement of financial position in an amount equivalent to the operating asset’s fair value at the time the leasing contract was entered into or, if lower, the net discounted value of the future minimum payments under the terms of the lease contract. The liability to the lessor is included in the statement of financial position as a financial lease liability. Lease payments are recognised in the accounts as interest expense and a reduction in the lease liability. Leased assets are depreciated over the expected useful life in accordance with the depreciation plan for owned assets. If it is not likely that the group will take over the asset upon the expiry of the leasing contract, the asset is depreciated over the shorter of the life of the leasing contract and the depreciation period applied for equivalent assets owned by the group.

Financial derivatives The group’s financial derivatives consist almost entirely of hedging derivatives. All purchases and sales of financial instruments are recognised on the transaction date. Changes in fair value for derivatives that meet the requirements for cash flow hedging are reported in the statement of comprehensive income as “comprehensive income”. Derivatives that are not classified as hedging instruments are classified as available for sale and valued at fair value. Changes in the fair value of such derivatives are recognised as financial income/financial expense.

Hedging The group has established a strategy to hedge the currency and interest rate risks related to its international investments. The strategy is designed to ensure a high degree of predictability in currency gains/losses and interest costs. Derivative contracts are recognised as hedging instruments if they satisfy the following criteria: a) hedging is expected to be highly effective in achieving offsetting changes in fair value or cash flows attributable to the hedged risk, with hedge effectiveness in the range 80–125 %, b) the effectiveness of the hedging can be reliably measured, c) there is adequate documentation on entry into the hedging to show that the hedging is highly effective, d) hedging is reviewed regularly and has proved effective throughout the reporting periods for which it was intended.

The group has hedged (cash flow hedging) part of its net investment in Swedish kroner. Changes in the value of currency derivatives classified as hedging instruments are netted against financial income/financial expense in the consolidated accounts and form part of comprehensive income.

In addition, the group hedges part of its exposure to the electrical power market by purchasing forward contracts. The efficiency of this hedging in terms of the price achieved is measured by comparing changes in the fair value of the derivative (the financial contract) against the physical supply of electricity (price).

The hedging instrument in cash flow hedges is recognised at fair value at the date of the financial position statement. If the hedging is evaluated as effective, the change in value is recognised as part of “comprehensive income”. If the hedging is evaluated as not effective, the change in value is recognised as financial income/expense in the profit and loss account. Hedging instruments are classified as non-interest bearing liabilities or receivables in the statement of financial position. 60 Annual Accounts Group

Inventories Inventories are valued at the lower of purchase price and net realisable value. Net realisable value is defined as the expected sale price under normal commercial conditions with a deduction for sales costs. Purchase price is determined on the basis of average cost price.

Accounts receivable Accounts receivable are recognised in the statement of financial position at nominal value after a deduction for possible losses. A provision for estimated losses is included in the presentation of comprehensive income when a loss causing event takes place and there is objective evidence that the value of the asset is impaired.

Equity The nominal value of holdings of own shares is reported in the statement of financial position as a deduction to share capital. The purchase price in excess of nominal value is charged to share premium. Gains or losses on transactions in own shares are applied directly to equity. If own shares are sold at a price in excess of cost price, the surplus is recognised as other paid-in equity. Realised losses related to sales of own shares are recognised against retained earnings.

Transaction costs in relation to equity transactions are charged to equity after deducting tax.

The fair value reserve includes cumulative net changes in fair value of financial instruments until the investment is disposed of.

Share based payments The group has issued equity-settled share-based payments to certain key employees and the group’s executive management which grant a fixed monetary compensation where the participant is required to invest the net amount into shares in the parent company. Equity-settled share-based payments are measured at fair value when they are granted and are charged to profit and loss on a linear basis over the vesting period. The group also has given employees the opportunity to purchase the group’s ordinary shares at a discount to the current market value and to be granted bonus shares. The Board of Directors decides such employee share ownership grants from time to time. Discounts in the employee share ownership program are recorded as salaries and personnel costs when the discount is given to the extent that the discount is vested.

Financial liabilities On initial recognition, financial liabilities are stated at fair value after deducting transaction costs, but thereafter liabilities is stated at amortised cost using the effective interest method. In addition, if fair value hedging is used, the liability that is hedged it also adjusted for gains and losses that can be attributed to the risk that has been hedged. When the liability is repaid, in whole or part, the difference between the book value of the liability and the amount repaid is recognised in the profit and loss account.

Pension liabilities Liability in respect of contractual pension arrangements in the group is valued as the present value of the future pension benefits for which entitlement has been earned at the date of the statement of financial position, and is calculated on the basis of assumptions about discount rates, the investment return on pension assets and expected growth in earnings and pensions. Pension calculations use the K2013 table for mortality risk. The risk table for disability, IR02, corresponds with the estimated risk of disability in the group. Pension assets are valued at fair value on the accounting period date. In cases where there is not sufficient information available from the pension scheme’s administrator on the company’s assets and liabilities in the scheme, the scheme is treated as a defined contribution scheme. Costs incurred in relation to the group’s pension arrangements are reported as salary costs in the accounts.

The starting point for calculating pension costs in respect of the group pension schemes is linear application of pension entitlement earned against the likely accumulated pension liability at the time the pension is first drawn. The cost of pensions is calculated on the basis of the discounted pension entitlement earned at the beginning and end of the year and the pension rights accrued during the year, less the return on the assets provided to fund pensions. Significant changes to the pension schemes, including scheme closures and changes that cause the issue of paid-up policies, are recognised in the accounts in the accounting period when such change takes place. The effect of any changes in the pension scheme that leads to the issue of fully paid-up policies is recognised in the period the change is made. The effect of other changes in the pension scheme is amortised over the expected average remaining service period. The effect of any changes in estimates, changes in assumptions and calculation are accounted for as “comprehensive income” in the period that they occurs.

The group has established a compensation scheme for employees in connection with the closure of a defined benefit pension scheme. The size of the compensation and the profile for its accrual are calculated on the basis of a standard set of calculation parameters at the time of the change to the pension arrangements. The accrual formula and profile Annual Accounts Group 61

for the compensation scheme are used as the basis to make provisions in the accounts so that the total compensation earned to date by employees at any time is provided for as a liability in the consolidated statement of financial position.

Employees in the group’s Norwegian companies are members of an early retirement scheme (AFP), which is a multi-company defined benefit scheme, and is financed by premium payments determined as a percentage of- sa lary. There is no reliable measurement and allocation of liabilities and asset between the companies that participate in the scheme. The scheme is therefore treated for accounting purposes as a defined contribution pension scheme and the premiums paid are recognised as costs through profit and loss.

Provisions A provision is recognised in the accounts only when the company is subject to a liability that is a consequence of an event that has already happened and where it is likely (i.e. more likely than not) that in order to reduce or discharge the liability the company will have to apply financially measurable resources, and the liability can be reasona- bly estimated. Provisions are evaluated at the end of each accounting period and adjusted to reflect the available information about the provision. Where the information available is insufficient, a best estimate is used. If the time period to the date at which the liability may lead to payment has a material effect on the calculation, the provision will represent the discounted present value of the future liability. Increases in liability caused solely by the lapse of time are reported as an interest expense.

Provisions for restructuring costs only include direct expenses linked to the restructuring which are both necessary for the implementation of the restructuring and which do not relate to the continuing ordinary activities of the company. Such provisions are recognised in the accounts when the company has a detailed plan for the restructuring in question that identifies which business areas will be affected, the locations affected, the functions and estimated number of employees due to receive termination payments, the costs that will be incurred and a time plan for implementation. There must be a real expectation by the parties affected that the company will implement the restructuring. This means either that implementation of the restructuring program has commenced or that the main elements have been disclosed to the affected parties.

Contingent assets and liabilities A contingent asset is defined as a possible asset, that arises from past events, and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events, not wholly within the control of the entity. Contingent assets are not included in the annual accounts, but information is provided if there is a reasonable certainty that the benefit in question will accrue to the group.

Contingent liabilities comprise:

- a possible obligation arising as a result of past events where the obligation depends on some uncertain future event - a present obligation that is not recognised in the accounts since it is not probable that the obligation will result in a payment being made - liabilities that cannot be measured reliably

Contingent liabilities are not recognised in the accounts with the exception of contingent liabilities acquired as part of the purchase of a business. Continent liabilities acquired as part of the purchase of a business are recognised in the accounts at fair value even if the liability is not likely to crystallise.

Cash flow statement The cash flow statement is presented using the indirect method. The group’s activities are divided into operational, financing and investment activities. Investment in new business or sale of business is classified as cash from/to investments, in the cash flow statement, and amounts to the purchase price/sales price less transferred cash and cash deposits at the transaction date.

The cash flow statement includes businesses disposed of up to the date of disposal.

Discontinued operations If a decision is taken to discontinue or to sell a major part of the group’s operations or if control/significant influence over a company is lost, the operations in question are presented as ‘discontinued operations’ in a separate line entry on the income statement and in the statement of financial position. ‘Major’ means a separate segment or a significant asset. This means all other figures presented are exclusive of ‘discontinued operations’. The comparison figures in the income statement are correspondingly restated. The comparable figures in the statement of financial position and in the statement of cash flow are not restated. 62 Annual Accounts Group

3. Approved changes to IFRS and IFRIC that came into force after the date of the accounts The following paragraphs provide an overview of changes to IFRS/IAS standards that are relevant to the group’s activities but have not yet come into effect. The group anticipates that the implementation of the changes listed below will not have any material effect on the consolidated accounts when the changes are made.

Annual Improvements to IFRSs (2011 – 2013) - Amendment to IFRS 3: Scope exceptions for joint ventures The amendment clarifies that: • Joint arrangements are outside the scope of IFRS 3, not just joint ventures • The scope exception applies only to the accounting in the financial statements of the joint arrangement itself

Annual Improvements to IFRSs (2011 – 2013) - Amendment to IFRS 13: Scope paragraph 52 (portfolio exception) The portfolio exception in IFRS 13 can be applied to financial assets, financial liabilities and other contracts.

IFRS 9 - Financial Instruments IFRS 9 Financial Instruments will eventually replace IAS 39 Financial Instruments: Recognition and Measurement. In order to expedite the replacement of IAS 39, the IASB divided the project into phases: classification and measurement, hedge accounting and impairment. New principles for impairment were published in July 2014 and the standard is now completed. The parts of IAS 39 that have not been amended as part of this project has been transferred into IFRS 9. The EU has still not yet approved the standard, and its implementation has been postponed until 1 January 2018. Early application will be permitted if the EU approves the standard. The group expects to apply IFRS 9 with effect from 1 January 2018.

IFRS 15 Revenue from Contracts with Customers The IASB and the FASB have issued their joint revenue recognition standard, IFRS 15 Revenue from Contracts with Customers. The standard replaces existing IFRS and US GAAP revenue requirements. The core principle of IFRS 15 is that revenue is recognised to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard applies to all revenue contracts and provides a model for the recognition and measurement of sales of some non-financial assets (e.g., disposals of property, plant and equipment). The EU has still not yet approved the standard, but it is expected to enter into effect on 1 January 2017. The group expects to apply IFRS 15 with effect from 1 January 2017.

IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures: Sale or contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28) The amendments address an inconsistency between the requirements in IFRS 10 and those in IAS 28 (2011), in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The main consequence of the amendments is that a full gain or loss is recognised when a transaction involves a business (whether it is housed in a subsidiary or not). A partial gain or loss is recognised when a transaction involves assets that do not constitute a business, even if these assets are housed in a subsidiary. The EU has still not yet approved the standard, but it is expected to enter into effect on 1 January 2016. The group expects to apply IFRS 15 with effect from 1 January 2016.

IAS 1 Presentation of Financial Statements: Disclosure Initiative (Amendments to IAS 1) In December 2014, the IASB issued amendments to IAS 1 Presentation of Financial Statements as part of its Disclosure Initiative. The amendments to IAS 1 further encourage companies to apply professional judgment in determining what information to disclose and how to structure it in their financial statements. The EU has still not yet approved the standard, but it is expected to enter into effect on 1 January 2016. The group expects to apply IFRS 15 with effect from 1 January 2016.

IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets: Clarification of Acceptable Methods of Depreciation and Amortisation (Amendments to IAS 16 and IAS 38) 38) IAS 16 and IAS 38 both establish the principle for the basis of depreciation and amortisation as being the expected pattern of consumption of the future economic benefits of an asset. The IASB has clarified that the use of revenue- based methods to calculate the depreciation of an asset is not appropriate because revenue generated by an activity that includes the use of an asset generally reflects factors other than the consumption of the economic benefits embodied in the asset. The IASB also clarified that revenue is generally presumed to be an inappropriate basis for measuring the consumption of the economic benefits embodied in an intangible asset. This presumption, however, can be rebutted in certain limited circumstances. The EU has still not yet approved the standard, but it is expected to enter into effect on 1 January 2016. The group expects to apply IFRS 15 with effect from 1 January 2016. Annual Accounts Group 63

IAS 27 Separate Financial Statements: Equity Method in Separate Financial Statements (Amendments to IAS 27) The objective of these amendments is to restore the option (which was removed in 2003) to use the equity method to account for investments in subsidiaries, joint ventures and associates in an entity’s separate financial statements. Therefore, an entity must account for these investments either:

• At cost • In accordance with IFRS 9 (or IAS 39) Or • Using the equity method

The entity must apply the same accounting for each category of investments.

As a consequence IFRS 1 was amended to allow a first-time adopter accounting for investments in the separate financial statements using the equity method, to apply the IFRS 1 exemption for past business combinations to the acquisition of the investment. The EU has still not yet approved the standard, but it is expected to enter into effect on 1 January 2016. The group expects to apply IFRS 15 with effect from 1 January 2016.

Note 2 Changes in group structure

Changes in group structure 2014 There has been no material changes in the group structure during the year 2014.

Changes in group structure 2013 With effect from 25 November 2013, the group has acquired 100% of the share capital of TAG System Finland OY, which is the leading card personalisation company in Finland and the Baltic states. This acquisition strengthens EVRY’s geographic coverage of the North European card services market. Estimated goodwill of NOK 58.3 million recognised in connection with the acquisition relates to the leading-edge expertise of the company’s employees in the areas of card technology and mobile payments. The acquisition of this company did not have any material effect on the consolidated accounts for 2013. 64 Annual Accounts Group

Note 3 Segment information

The group’s activities were divided into three segments for the purpose of reporting in 2014. The allocation of activities to segments is based on the main markets served by the group, and corresponds with the structures used for internal reporting to the executive management, which is the chief operating decision makers in the group. The segment structure is unchanged from the 2013 reporting.

The EVRY Financial Services segment offers a broad portfolio of solutions and services, and is a complete industry vertical with responsibility for all the company’s deliveries to bank and finance customers. The solutions portfolio includes solutions for all core banking services, whether this relates to interfaces with end-customers or solutions to support a bank’s internal processes and employees. The portfolio is module-based, and includes banking services, transactions systems, payment solutions and card services. The portfolio also includes a unique value chain of card services that are delivered to banks in the Nordic countries and in the United Kingdom.

The EVRY Sweden segment offers everything from strategic advice and consulting services through to solutions and IT operating services. EVRY Sweden has a significant portfolio of industry vertical solutions that combine industry- specific insight and business understanding with technological expertise. EVRY Sweden also delivers services based on strong specialist expertise that are independent of geographic location and sector, for example ERP solutions, mobility, cloud-based solutions and Business Intelligence. EVRY Sweden also has its own operating services organisation, which focuses on medium-sized businesses and entities in the private and public sectors.

The EVRY Norway segment offers consulting, infrastructure and operating services. EVRY Norway has a long history with leading customers in the Norwegian public and private sectors, and holds strong positions in a number of industry verticals where it combines industry insight and business understanding with technological expertise. Customer deliveries cover a broad range of consulting and solutions services, as well as IT operating services. EVRY Norway has a significant position in the local government and healthcare sectors, and is currently strengthening its position in other verticals including retail, oil & gas and insurance. Through its extensive activities, EVRY Norway has in-depth technical expertise in specialist services that are independent of geographic location and sector. This includes growth areas such as mobility, cloud-based solutions and Business Intelligence. The segment also includes the group’s Global Sourcing activities for reporting purposes.

The group’s other activities are shown in the presentation below as corporate costs / eliminations. These activities principally relate to financing and central group functions that are not allocated to the segments. Non-recurring items are not distributed to the segments in accordance with the management reporting structure in the group, and are specified in a separate table on the next page.

Transactions between the business areas are based on market terms and conditions and are reported as corporate costs / eliminations in the presentation on the next page. The rental of software and other IT equipment is based on the cost from an external supplier plus a margin. The purchase and sale of consulting services between the segments is charged at an agreed price equivalent to the price achieved by the best customer. The operating profit (EBITA) reported for each segment includes revenue and costs related to transactions with other segments of the group.

The group’s chief operating decision makers (executive management) follow up the operating profit (EBITA) of each segment on a regularly basis and use this information to analyse the various segments’ operational performance and to make decisions on resource allocation. The performance of each segment is evaluated on the basis of revenue growth and EBITA, and the measurement of revenue growth and EBITA is consistent with the consolidated revenue and EBITA figures reported for the group as a whole. Management also monitors each segment in terms of other key figures such as EBITDA, operational investment spending, working capital and the customer credit - time. Annual Accounts Group 65

Non-recurring items

2014 2013

Provisons for restructuring -120.0 -24.0 Termination of pension schemes - 24.3 Provisons for premises - -11.0 Write-down of goodwill -1 164.3 -529.6 Write-down of other balance sheet items -34.3 -71.0 Provisions fire Sweden -40.0 - Strategic process -76.9 - Write-down / provisions related to DigOff - -10.0 Total non-recurring items -1 435.5 -621.3

The group does not have any single customer that accounts for more than 10 % of its consolidated revenue.

Information about the group’s segments for reporting purposes is presented below:

2014

Operating Depreciation NOK million revenue EBITDA and write-down EBITA Assets Liabilities CAPEX

EVRY Financial Services 3 682.5 523.5 152.0 371.5 2 803.5 569.3 115.1 EVRY Sweden 3 472.2 313.3 58.5 254.8 2 859.7 734.6 79.6 EVRY Norway 6 092.8 545.2 223.1 322.1 4 683.5 1 408.8 255.2 Corporate costs / eliminations -474.3 -91.8 43.2 -135.0 356.5 3 712.5 40.8 Non-recurring items - -271.2 - -271.2 - - - Total 12 773.1 1 018.9 476.8 542.1 10 702.7 6 425.3 490.7

2013 1)

Operating Depreciation and NOK million revenue EBITDA write-down EBITA Assets Liabilities CAPEX

EVRY Financial Services 3 553.6 450.0 124.2 325.8 3 061.5 584.3 198.8 EVRY Sweden 3 292.9 263.7 50.5 213.2 2 742.9 748.1 65.6 EVRY Norway 6 180.3 595.2 236.4 358.8 5 919.6 1 275.9 335.8 Corporate costs / eliminations -426.5 -90.0 43.7 -133.7 272.0 4 041.4 25.8 Non-recurring items - -91.5 - -91.5 - - - Total 12 600.2 1 127.4 454.8 672.7 11 996.9 6 649.7 626.0

1) Restated

There are no differences in the measurement methods applied at the segment level as compared to the methods used for the consolidated accounts. In some cases, asset and liability items that relate to more than one segment are allocated to the segments on the basis of revenue.

Geographic segments The group’s activities are divided between Norway, Sweden (incl Finland) and other countries. Other countries are mainly related to USA and other European countries beside Norway, Sweden and Finland.

Operation revenues

2014

Norway 8 302.5 Sweden 3 961.5 Other countries 509.1 Total 12 773.1 66 Annual Accounts Group

Note 4 Management of capital structure and financial risk

1. Management of capital structure EVRY’s main objective for the management of its capital structure is to maximise value creation for shareholders, while at the same time maintaining a sound financial position and a good credit rating.

The group monitors its capital structure in terms of its equity as a proportion of total assets (equity ratio) and net interest-bearing liabilities as a proportion of total equity (gearing). In addition, the group monitors ratio between net interest-bearing debt (NIBD) and EBITDA (gearing ratio). The target for the gearing ratio is for the ratio to be less than 2.60. At 31 December 2014, NIBD/EBITDA was 2.46.

Net interest-bearing liabilities are defined as interest-bearing liabilities (current liabilities and non-current liabilities) minus bank deposits.

EVRY’s objective is to generate the best possible long-term return for its shareholders, through dividends paid and share price increases that combined, match or exceed the return available on similar investment opportunities of comparable risk. The company aims to pay an annual dividend equivalent to 20-50 % of normalised post-tax profit, defined as post-tax profit adjusted for non-recurring items such as gains on disposals, provisions for restructuring and non-recurring tax charges, subject to the Board’s assessment that this will not have an material adverse effect on the company’s future growth ambitions and capital structure.

Subsidiary companies have only limited authority to establish independent financing arrangements, and are required to distribute their surplus capital to EVRY ASA by means of dividend, repayment of financing or group contributions.

NOK million 31.12.2014 31.12.2013

Non-current interest bearing liabilities 3 181.3 3 520.7 Current interest bearing liabilities 3.0 3.0 Bank deposits 615.6 683.2 Net interest bearing liabilities 2 568.8 2 840.5

Equity 4 277.4 5 346.4 Total assets 10 702.7 11 996.0

Gearing 0.60 0.53 Equity ratio 40 % 45 %

2. Management of financial risk The group’s policies for the management of financial risk are determined by the Board of Directors of EVRY ASA. The main objective of financial risk management is to identify, quantify and manage exposure to financial risks. Operational responsibility for monitoring and managing financial risk is the responsibility of EVRY’s centralised finance function.

Financial risk is normally divided into three groups:

1. Market risk a. Interest rate risk b. Currency risk c. Price risk /Energy contracts 2. Credit risk 3. Liquidity risk

1. Market risk The market risk is the risk of changes in market prices and changes in fundamental conditions of the economy, such as changes in interest rates, exchange rates, prices of inputs and the cost of capital. Annual Accounts Group 67

1a. Interest rate risk Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in the general level of interest rates. The group’s exposure to interest rate risk relates principally to interest-bearing liabilities on floating interest rate terms. The principal objective for EVRY’s management of interest rate risk is to ensure a predictable outcome. The group’s objective is for between 50 % and 70 % of its borrowings to be on fixed rate interest terms. This will ensure predictability in terms of interest costs and the related cash flows.

The group endeavours to manage the average duration of interest rate fixing terms to be between 1.5 years and 4.0 years.

See also Note 5 Financial instruments for more information on the group’s exposure to interest rate risk.

1b. Currency risk The principal objective for EVRY’s management of currency risk is to reduce the effect of changes in exchange rates on future cash flows and on the group’s financial condition. Currency risk can be divided into i) transaction risk, ii) translation risk and iii) strategic risk: i) Transaction risk represents the risk that future cash flows may fluctuate as the result of changes in exchange rates, and it arises as a result of financial transactions that involve agreement on future receivables or liabilities that are settled in a currency other than the group’s functional currency.

EVRY has both revenue and costs denominated in foreign currencies, accordingly it engages in some degree of routine activity to hedge the foreign currency component of financial transactions. The group has also established an arrangement for multicurrency bank accounts for the group, and these accounts are used to reduce exposure to currency risk at the group level. The group hedges future receipts and payments denominated in foreign currency where the amount is greater than the equivalent of NOK 50 million by entering into forward contracts that mature on the settlement day for the payment. ii) Translation risk represents the risk that assets or liabilities may be exposed to changes on currency conversion as the result of changes in exchange rates.

Since the group has a significant scale of activities in Sweden, it arranges for part of its borrowings to be denomi nated in Swedish kroner (net investment). iii) Strategic risk is a concept used to describe the long-term effects of changes in exchange rate, such as establish- ing business operations in low-cost countries, importing from countries with low commodity prices and other exposure to currency risk in relation to strategic decisions.

EVRY has established subsidiary companies in India and Ukraine, these two companies have income mainly in EUR and USD. The group’s exposure to currency risk relates principally to Swedish kroner (SEK), Euro (EUR) and US dollar (USD).

See also Note 5 Financial instruments for more information on the group’s exposure to currency risk.

1c. Price risk/Energy contracts The group purchases energy in the spot market, and hedges prices for part of its energy requirements by using pricing contracts in the forward market. The objective of this strategy is to reduce the risk of fluctuation in the cost of energy purchases, and thereby provide greater certainty for cash flow. Energy contracts work in such a way that the group pays the spot price for its actual power consumption, but pays the difference when the value of the contract is higher than the spot price and receives the difference when the contract value is lower than the spot price. The price of the electric power actually consumed is determined on the basis of the local area price, hence the com pany is exposed at all times to local area risk. The prices used for hedging contracts are determined on the basis of the national grid price (average price calculated by Nord Pool).

Changes in fair value are divided between an effective hedging element and an ineffective hedging element, with changes in the value of the effective hedging element applied directly to equity (hedge accounting). In order for hedging to be deemed effective, the hedge effectiveness must be in the range 80% - 125%. All energy contracts are denominated in Euro, hence the NOK/EUR exchange rate will also affect the risk exposure arising from energy purchases.

See also Note 5 Financial instruments for more information on the group’s energy contracts. 68 Annual Accounts Group

2. Credit risk Credit risk relates to the risk that the group’s counterparties fail to make the payments to which they are committed, causing the group to suffer a financial loss. The responsibility for credit control and collection of overdue amounts is centralised in a separate unit within the group.

No significant provisions were required in 2014 for losses on receivables from customers.

The group’s maximum exposure to credit risk at 31 December 2014 was NOK 2,169 million.

See also Note 17 Accounts receivable and Note 18 Other receivables for more information on the group’s exposure to credit risk.

3. Liquidity risk Liquidity risk arises if the cash flows generated by the group are not sufficient to match its financial liabilities as they fall due. The target for the group’s management of liquidity risk is to maintain a liquidity reserve that is equivalent to at least 10% of revenue for the previous 12 months. It is group policy to operate at all times with core long- term financing arrangements with its banks in order to make it possible to use long-term bank facilities to finance long-term investments. The group restricts its current interest-bearing debt to a maximum of NOK 300 million in addition to the credit facility, in order to ensure that the risk of refinancing are reduced. Financing for corporate acquisitions is evaluated independently.

The group monitors its liquidity daily, and produces rolling liquidity forecasts on a monthly basis in order to identify liquidity requirements in future periods.

See also Note 5 Financial instruments for more information on the group’s exposure to liquidity risk.

Note 5 Financial instruments

A) Non-current interest bearing liabilities and interest rate risk

Non-current interest bearing liabilities

NOK million 31.12.2014 31.12.2013

Financial lease 25.2 28.3 Liabilities to credit institutions 3 156.2 3 492.5 Non-current interest bearing liabilities 3 181.3 3 520.7

On 31 March 2011, EVRY ASA entered into an agreement with four banks for a new revolving credit facility of NOK 4,500 million. The four banks are DNB, Handelsbanken, Nordea and SEB, and each bank provides an equal share of the financing. The company’s revolving credit facility was refinanced in March 2015 as a part of the strategic process that the company has been involved in.

The borrowing covenant in relation to NIBD / EBITDA is for the ratio to remain below 3.25. The group is in compliance with its borrowing covenants.

Commitment fees and loan setup fees totalling NOK 33.0 million have been capitalised. Of this amount, NOK 24.8 million was recognised as financial expense as at 31. December 2014.

Interest rate swap agreements In order to secure fixed interest rate terms, EVRY ASA has entered into interest rate swap agreements for principal amounts of NOK 1,952 million. As a result of these agreements, the group pays fixed interest rates on 62 % of its total borrowing portfolio. The interest rate swap agreements are structured in relation to specific borrowings in order that the quarterly rollover dates for the swap agreements correspond with the rollover dates for the borrowings in question. Annual Accounts Group 69

Interest rate swaps 31 December 2014:

Fixed Currency Amount Maturity date interest rate Mtm value

Interest rate swap Nordea NOK 230 16.01.2016 1.97 % -1.9 Interest rate swap DNB NOK 250 14.03.2016 2.13 % -3.0 Interest rate swap SEB SEK 500 16.01.2017 1.63 % -13.5 Interest rate swap Nordea NOK 300 16.11.2018 2.62 % -16.7 Interest rate swap Nordea NOK 500 16.11.2018 2.95 % -34.2 Interest rate swap Nordea SEK 200 16.11.2018 1.23 % -5.6

The average duration of interest rate swap agreements as at 31 December 2014 was 2.9 years.

Interest rate risk – sensitivity analysis The group’s exposure to interest risk is dependent on the general level of market interest rates (Nibor/Stibor). The company incurs significant interest costs on its borrowings, and a change in interest rates would represent an significant increase/decrease in the company’s overall earnings.

The group uses interest rate swaps to hedge against large fluctuations in cash flow. An increase in the general level of interest rates will cause an increase in interest expense, but the effect will be offset to some extent by interest rate swaps through which the group pays a fixed rate of interest and receives a floating rate of interest.

The group calculates the valuation effects on its holdings of financial instruments by simulating a change in the yield curve. An increase in the general interest rate will increase the value of the group’s interest rate swaps, while at the same time the group’s interest costs will rise as a result of higher interest rates payable on the part of its total borrowings that is subject to floating interest rates.

The table below shows the effect of an increase of 100 basis points in interest rates on the consolidated profit and loss account

NOK million 2014 2013

Change in fair value interes rate swaps 49.3 64.0 Change in interest expenses after tax -8.6 -11.3 Effect on total profit 40.7 52.7

B) Exchange rate risk and currency hedge

Financial items per currency 31 December 2014:

NOK million SEK USD EUR Other

Accounts receivable 709.9 66.7 65.9 25.5 Accounts payable 255.2 3.8 10.4 20.1 Bank deposits 76.8 24.5 -9.6 115.8 Non-current liabilities 1 151.6 - - - Net exposure financial position -620.2 87.4 45.9 121.1

At the end of 2014 the group had borrowed SEK 1,200 million to hedge its investments in Sweden. Translation differences in respect of this loan and receivables due from foreign activities are applied as comprehensive income. The translation difference recognised in 2014 amounted to NOK 5.4 million after tax.

Net investments denominated in SEK amounted to NOK 613 million at 31 December 2014. Accordingly, a change in the SEK/NOK exchange rate of 100 basis points would cause a change in the book value of NOK 6.1 million.

The company has no material balance sheet risk in relation to currencies other than SEK. 70 Annual Accounts Group

Exchange rates of relevance:

2014 2014 2013 2013 NOK million Average Spot Average Spot

SEK 0.9184 0.9597 0.9022 0.9472 EUR 8.3534 9.0365 7.8087 8.3825 USD 6.3018 7.4332 5.8768 6.0837 GBP 10.369 11.571 9.1968 10.053

C) Liquidity risk

NOK million 2014 2013

Liquidity reserve 31 December 2 414 2 145 Liquidity reserve/Revenues last 12 months 19 % 17 % Share of current interest bearing liabilities 0.10 % 0.09 %

Maturity profile for financial liabilities:

More than NOK million Total 0 - 1 year 1- 5 year 5 years

Accounts payable 885.1 885.1 - - Deductions and duties payable 1 187.1 1 187.1 - - Financial lease 28.3 3.1 12.6 12.6 Other current liabilities 819.9 819.9 - - Maturity credit facility 3 151.3 - 3 151.3 - Interests 1) 125.0 100.0 25.0 - Total financial liabilities 6 196.7 2 995.2 3 188.9 12.6

1) Estimate based on 3-month NIBOR/STIBOR and 67 %/33 % balance of NOK/SEK, average interest rate 3.2 %

D) Energy contracts

NOK million 2014 2013

Fair value energy contracts -7.0 -6.5 Ineffective part of hedging -0.6 -4.5

Changes in the market value of hedging instruments since 31 December are recognised as part of comprehensive income. If any part of the hedging is evaluated as not effective, the change in value is recognised as “Other financial income/expense”. Annual Accounts Group 71

Note 6 Use of estimates

A key accounting estimate is an estimate that is important for the presentation of the group’s financial position and profit, and that requires subjective and complex evaluation by the company’s management, typically as the result of the need to determine such estimates based on assumptions about future outcomes that are subject to uncertainty. The group keeps such estimates under constant review on the basis of historical results and experience, consultation with experts, trends, forecasts and other methods that the group considers reasonable in specific circumstances including evaluating how such factors may change in the future.

Goodwill and other intangible assets The group tests goodwill for impairment annually. The book value of goodwill in the group’s cash-generating units is measured against the value in use of goodwill in these units. The recoverable amount from cash generating units is determined through calculations of value in use. These calculations are based on discounted cash flows that involve uncertainty and require the use of estimates. A change in the yield requirement used for discounting future cash flows will affect the book value of goodwill. An increase in the yield requirement will, in isolation, cause a lower value in use which in turn will cause a fall in the value of goodwill. Other intangible assests are tested for are tested for impairment if there are indications of a material loss of value.

Income recognition Where operating services are provided through volume-based contracts, revenue is recognised on the basis of the actual use of services by the customer. If there is no reconciliation/account of actual use at the end of the accounting period, revenue for the period is estimated on the basis of historic figures, adjusted for any known events/ information that have influenced usage during the period.

Where services are recognised to revenue on the basis of the degree of completion, revenue is estimated on the basis of the number of hours delivered as a proportion of the total estimated number of hours that will be required for the delivery

Depreciation of fixed assets and intangible assets Depreciation is based on management’s estimate of useful life. Such estimates may change as a result of technological developments, competition, changes in market conditions and other matters. This may cause changes in the estimated useful life and accordingly in depreciation.

Onerous contracts Provisions made in respect of onerous contracts are determined on the basis of management’s best estimate of the expenditure that would be required to settle the present obligation at the balance sheet date. This represents the amount that the group would rationally pay to settle the obligation at the balance sheet date or to transfer it to a third party. A provision in respect of an onerous contract is recognised in full in the period in which the contract is recognised as being onerous.

Capitalisation of development projects When capitalising development costs that relate to the use of internal resources, costs are estimated using an hourly rate based on the direct costs per employee. In the event of any indication of the need for a write-down in respect of an individual development project, the recoverable amount is tested against the book value. The recoverable amount assigned to the development project is determined on the basis of calculations of value in use. These calculations are based on discounting future cash flows that involve uncertainty and require the use of estimates. A change in the forecast revenue or margin used when estimating future cash flows will affect the estimated value of the development project in question. 72 Annual Accounts Group

Note 7 Salaries and personnel costs

NOK million 2014 2013

Salaries 4 862.5 4 518.0 Social security tax 850.9 835.3 Pension costs 399.3 364.6 Other benefits 336.0 291.2 Total salaries and personnel costs 6 448.7 6 009.2

Average number of employees 10 347 10 194 Average number of man years 10 151 9 948

Loans to employees As of 31 December 2014 loans of NOK 0.2 million for consumer goods have been granted to employees of the former IS Partner AS. The loans were taken over from DnB following the acquisition of IS Partner AS from Statoil. The loans are repaid through deductions from salaries and from severance pay where relevant. This arrangement was closed in 2008.

Executive management remuneration

NOK million 2014 2013

Chief Executive Officer (Terje Mjøs) Salary 4.115 4.018 Bonus 1.509 1.100 Sharebased remuneration (LTI) 2.039 1.275 Pension benefits earned through the year 0.988 0.968 Other remuneration 0.300 0.271

Chief Executive Officer Terje Mjøs resigned from the company with effect from 24 March 2015. New Chief Executive Officer, Björn Ivroth, assumed the position the same day. Annual Accounts Group 73

Other members of the executive management 2014

Sharebased remuneration NOK million Period Salary (LTI) Bonus Pensions

Knut E. Røsjorde 1.7 - 31.12 1.005 0.248 - 0.180 Anne-Cecilie Fagerlie 1.961 0.400 0.105 0.286 Morten Søgård 2.010 0.400 0.406 0.357 Wiljar I. Nesse 2.089 0.420 0.655 0.289 Niclas Ekblad 3.134 0.643 0.909 0.990 Håvard Larsen 2.036 0.350 0.476 0.321 Kurt Helland 1.4 - 31.12 1.315 0.314 - 0.205

Previous members of the executive management Eli Giske 1.1 - 28.2 0.790 - 0.576 0.163 Knut Morten Aasrud 1.1 - 31.1 2.447 - - 0.034

Other members of executive management 2013

Sharebased remuneration NOK million Salary (LTI) Bonus Pensions

Eli Giske 2.313 0.480 0.540 0.414 Knut Morten Aasrud 2.236 0.600 0.157 0.421 Morten Søgård 1.963 0.360 0.288 0.345 Wiljar I. Nesse 1.930 0.400 0.577 0.297 Niclas Ekblad 2.952 0.586 0.597 1.076 Håvard Larsen 1.949 0.350 0.361 0.315

The following guidelines were set out in a Statement by the Board of Directors pursuant to Section 6–16a of the Public Companies Act, and the Statement was approved by an advisory vote of the Annual General Meeting held on 14 May 2014:

Guidelines for determining salary and other remuneration for the next accounting year for the Executive Management The remuneration of members of the Executive Management shall reflect at all times the responsibility of the CEO and the other members of the Management Board, taking into account the complexity and breadth of the company’s operations. The determination of the level of the total compensation package will be based on being competitive but not excessive within the relevant labor markets. Senior management compensation primary reference group is large Nordic IT companies – also taking into account geographical location.

The total remuneration of the CEO and the other members of the Executive Management will consist of a fixed package of salary and benefits supplemented by performance-based bonuses, share-based long-term incentive schemes, employee share plan, pensions and insurance arrangements and severance pay. The Board of EVRY ASA has approved a bonus scheme for the members of the Executive Management, whereby bonuses will be paid based on the achie- vement of predetermined targets. The maximum bonus entitlement of the Chief Executive Officer is 50% of annual salary, and the maximum bonus entitlement for other members of the Executive Management is 40%-50% of annual salary. The bonus scheme shall reflect both the company’s results and the individual employee’s performance. The Board of Directors has established detailed guidelines to implement the above principles.

To improve the alignment between Executive Management and Shareholder interests and to ensure retention of key talent in the company, a long-term incentive plan has been approved for the Executive Management and some key positions. The program provides a fixed cash amount to eligible executives, who are required to invest the net amount after tax in EVRY shares. The acquired shares are locked in for a period of three years after the purchase. After this executives are free to keep or sell the shares at their discretion. The annual amount granted under the Long-term Incentive plan is not linked to EVRY’s financial results. The long-term incentive amount is determined individually each year based on a percentage of the salary. For the Chief Executive Officer, the incentive will represent one-third of salary, for the remaining Executive Management the incentive will represent 13% to 22% of salary, and for employees in key positions the incentive will represent 8% to 17% of salary. 74 Annual Accounts Group

A share purchase scheme was established in 2011, and continued in 2012 and 2013. The scheme is available to all employees in wholly owned Nordic companies within the group, including the Chief Executive Officer and other members of the Executive Management. A new share purchase program will be established in 2014, which in the same way as the 2013 share purchase program will offer a discount of NOK 2,000 for employees outside Norway, while holding the discount for Norwegian employees at NOK 1,500. The difference between the rebates offered is intended to compensate for the differences in taxation treatment between the different Nordic countries. It is proposed that the other terms of the share purchase program shall remain unchanged from 2013. The share purchase program is offered to all employees in wholly-owned Nordic companies within the group. This represents approximately 7,400 persons at the end of February 2014, and includes the members of the executive management.

The share purchase program for 2014 was not implemented because of the strategic process the company has been through the second half of 2014.

The Executive Management is members of a defined contribution pension scheme. In addition, the members of Executive Management are members of an uninsured defined contribution pension scheme (operations-based pension) for the portion of salary that exceeds 12 times the social security base amount (G), cf. Note 8 to the Annual Accounts.

Earned rights to the operations-based pension will be payable from retirement age.

The Chief Executive Officer has waived the redundancy rights provided by Chapter 15 of the Working Environment Act, cf. Section 15-16. He is entitled to receive salary for 12 months following the normal notice period of 6 months. Salary payable for the 12-month period would be reduced by up to 25% in respect of any other income. The following appears if a change in the ownership of the company whereby a single shareholder or a group acquires more than 50% of the shares or gains control of the company in any other way. If the Chief Executive Officer has not received an offer to continue in his current position in the company within three months of such change, and if he leaves the company’s employment, he is entitled to receive salary for 18 months following the normal notice period. Salary payable for the 18-month period will be reduced by up to 25% in the case of any other income.

The other members of the Executive Management are entitled to receive salary for periods between zero and 12 months following the expiry of their 6 to 12 month notice period, and are subject to a ban on competition during this period.

No member of the executive management received any remuneration or other benefits from any other company in the group other than those shown above. No additional payments are made for special services over and above an individual’s normal management responsibilities.

Board of Directors Remuneration to the Board of Directors in 2014 was paid out as follows: Remuneration Remuneration Total NOK million (Board) as employee remuneration

Arve Johansen (Chairman of the Board) 0.543 - 0.543 Posten Norge AS (Tone Willes's participation) 0.213 - 0.213 Hilde Lovise Ringereide 0.324 - 0.324 Anders Brandt 0.314 - 0.314 Lisbeth Gustafsson 0.284 - 0.284 Eirik Bornø 1) 0.344 0.712 1.056 Ola Hugo Jordhøy 1) 0.144 0.991 1.135 Jan Anders Dahlström 1) 0.284 0.541 0.825 Ingrid Lund 1) 0.324 0.626 0.950 Total remuneration 2.773 2.870 5.643

1) Employee elected board members

The remuneration to the Board of Directors are determined in advance and paid out every six month with one half each time. Annual Accounts Group 75

Note 8 Pensions

The group provides pensions principally through insured collective schemes with life insurance companies. Pension arrangements related at 31 December 2014 to 7,056 active employee members of defined contribution pension schemes, 197 active employee members of insured defined benefit schemes and 604 pensioners. The presentation of pension costs and pension liabilities set out below aggregates the various pension arrangements provided by the group. The figures therefore include a number of different defined benefit, defined contribution and multi-company pension schemes.

The group implemented the revised accounting standard IAS 19, which regulates the accounting treatment of pension liabilities and other employee benefits, with effect from 1 January 2013. The major change caused by the revised standard is that the “corridor method” can no longer be applied, and the effect of any changes in actuarial estimates must instead be recognised in full as part of the reporting of other income and costs in the period in which they arise. A further important change is that the expected return on pension assets must be calculated by using the interest rate applied to discount net pension liabilities or net pension assets. The difference between the actual return on pension assets and the return calculated using the discount rate is treated as a change in actuarial estimates that is recognised as part of other income and costs. The implementation of the changes has resulted in a reduction of NOK 175 million in the group’s pension liabilities and an increase of NOK 129 million in equity as at 1 January 2013.

The effect for the year of actuarial gains and losses recognised as other comprehensive income represented an increase in pension liability of NOK 57.3 million, principally as the result of a decrease in discount rate as a parameter to calculate net pension liability.

The group’s Norwegian companies operate a defined contribution pension scheme for employees. The annual contributions to this scheme are at the rates of 4 % for salaries between one and six times the social security base amount (G) and 8 % for salaries between 6 G and 12 G. On 31 December 2013, 651 employees were transferred from a defined benefit pension scheme to the group’s existing defined contribution pension scheme. A compensation scheme was established in connection with these transfers with the object of limiting the calculated loss in retirement pension capital incurred by employees as a result of the transfer. The compensation scheme is financed from operations and will be paid upon members achieving a retirement age of 67 in equal annual amounts over a 15-year period. The transition from defined benefit to defined contribution pension arrangements, taking into account the provision for the liability arising from the compensation scheme and other costs, had a net positive effect on profit of NOK 24.9 million in 2013. Following this transfer, the group has only a very small number of employees who are still members of defined benefit occupational pension arrangements.

The employees of the group’s Norwegian companies is members of the common scheme of AFP early retirement pension arrangement.The scheme gives a lifelong supplement to the ordinary pension. Employees can choose whether to draw the new AFP pension from 62 years of age, even if they continue to work, and additional rights can be earned by working until 67 years of age. The scheme is a multi-company defined benefit scheme, and is financed by premium payments determined as a percentage of salary. There is as yet no reliable measurement and allocation of liabilities and assets between the companies that participate in the scheme. The new scheme is therefore treated for accounting purposes as a defined contribution pension scheme and the premiums paid are recognised as costs through profit and loss with no provision made in the accounts. The premiums paid in 2014 were set at 2.2% of total salary payments for salary payments to the employer’s employees between the social security base amount (G) and 7.1 G. The equivalent premium rate for 2015 will be 2.4%, and it is expected that the level of premiums will increase in future years. The scheme is underfunded, and the administrator (Fellesordningen for AFP) assumes that premiums will have to increase over time in order to ensure sufficient buffer capital to cope with increased payments. Companies that participate in the AFP scheme are jointly and severally liable for two-thirds of the pension payments due to employees who satisfy the terms and conditions at any time. The liability applies both to shortfalls in premium payments and if the premium rate applied proves insufficient to meet the liabilities. In the event that the scheme is terminated, the participating companies have a duty to continue to make premium payments to provide for pension payments to employees who are members of the scheme or who satisfy the requirements of collective agreements for such pension arrangements at the date of termination.

Employees in the group’s Swedish companies are principally members of the ITP pension scheme. The ITP scheme is based on collective agreement between the Confederation of Swedish Enterprise and the Council for Negotiation and Co-operation representing salaried employees within the private sector. ITP came into operation on 1 July 2007, and applies to employees born in 1979 or later. All new employees become members of the scheme at 25 years of age. The ITP scheme is a defined contribution scheme, to which the employer contributes 4.5 % of salary up to 7.5 times the ”basic income amount” and 30 % of salary over this amount. Employees born before 1979 are members of the old scheme, which is a combination of a defined contribution scheme and a defined benefit scheme 76 Annual Accounts Group

(ITPK and ITP2 respectively). ITP2 is a multi-company scheme that provides a retirement pension calculated as 1 0% of final salary for salary up to 7.5 times the ”basic income amount”, 65% of final salary for salary between 7.5 times and 20 times the ”basic income amount” and 32.5 % of final salary for salary between 20 times and 30 times the ”basic income amount”. Full pension entitlement is earned after 30 years of pensionable employment. There is no reliable measurement and allocation of the company’s share of the overall assets and liabilities of the scheme. The scheme is therefore treated in the accounts as a defined contribution scheme. ITPK is a defined contribution scheme with a contribution rate of 2% with the possibility of additional contributions by agreement.

The members of executive management are members of a pension plan financed from operations. The operations pension plan is not subject to the legislation on defined contribution pensions or the legislation on enterprise pensions, and is not funded. The annual pension entitlement is calculated as 30 % of salaries exceeding 12 G for the Chief Executive Officer and 25 % of salaries exceeding 12 G for other members of executive management. The annual return shall at a minimum equal 12 months NIBOR as at 31 December of the previous year. The accumulated accrued entitlement, including investment return and employer’s social security contributions, totalled NOK 18.5 million at 31 December 2014.

Pension costs

NOK million 2014 2013

Current value of pension entitlement accrued over the year 18.8 60.7 Net interest on pension liabilities 4.1 -4.5 Curtailments and settlements - -36.2 Pension costs charged to profit and loss from defined benefit plans 22.9 20.0 Defined contribution schemes and early retirement plans 376.4 344.6 Pension costs charged to profit and loss 399.3 364.6

Change in calculated pension liabilities

NOK million 1.1 - 31.12.2014 1.1 - 31.12.2013

Implementation of IFRS 11 -11.2 - Defined benefit obligations 1 January 790.0 1 186.1 Current value of pension entitlement accrued over the year 18.8 60.7 Interest on pension liabilities 26.1 36.6 Actuariel gains and losses 128.8 71.6 Acquisition/sale of business, curtailment and settlement - -499.4 Pension payments -47.0 -54.6 Defined benefit obligations 31 December 916.7 801.1

Change in fair value of plan assets

NOK million 1.1 - 31.12.2014 1.1 - 31.12.2013

Implementation of IFRS 11 -6.8 - Fair value of plan assets 1 January 682.0 1 085.6 Actual return on plan assets 47.8 40.8 Curtailment and settlement 0.0 -462.4 Pension premium paid 8.5 62.2 Pension payments -36.0 -37.3 Fair value of plan assets 31 December 702.3 688.9 Annual Accounts Group 77

Pension liabilities

NOK million 31.12.2014 31.12.2013

Gross liability to provide pensions 916.7 801.1 Fair value of plan assets 702.3 688.9 Effect of asset ceiling -27.7 -74.3 Net pension liability 242.1 186.5

Plan assets in the statement of financial position - - Pension liabilities in the statement of financial position 242.1 186.5

Change in pension liabilities

NOK million 1.1 - 31.12.2014 1.1 - 31.12.2013

Implementation of IFRS 11 -4.4 - Pension liabilities 1 January 182.2 100.5 Pension costs 22.9 20.0 Effect of actuarial gains and losses recognised as comprehensive income 57.2 144.8 Premium payments -8.5 -62.2 Benefits paid and Paid-up policies -11.8 -16.7 Pension liabilities 31 December 242.1 186.5

The summarised information presented is based on annual calculations carried out by an independent actuary.

The following assumptions are used in the actuarial calculations:

2014 2013

Discount rate 2.30 % 4.00 % Future salary inflation 2.75 % 3.75 % Growth in the basic state pension (G) 2.50 % 3.25 % Annual increase in pensions 0.00 % 0.60 % Staff turnover Own table Own table Mortality assumptions K2013 K2013

The assumptions used for pension calculations follow the guidelines issued by the Norwegian Accounting Standards Board (NRS) as at 31 December 2014. Over recent years, the Norwegian market for covered bonds has grown strongly. NRS has therefore accepted the use of covered bond interest rates as the basis for the discount rate for pension calculations instead of using the interest rate on Norwegian government bonds. Based on it’s assessment of the depth in the Norwegian market for covered bonds, EVRY has applied the parameters recommended by the NRS 2014 guidelines, which includes using the covered bond interest rate as the basis for the discount rate.

Pension calculations use the K2013 table for mortality risk, which is based on the best estimate of the population in Norway. The risk table for disability, IR02, corresponds with the estimated risk of disability in the group. Extracts of information from the risk tables are provided below. The table shows the likelihood of an employee in a specified age group becoming disabled or dying within 12 months, and also shows life expectancy.

Life expectancy

Age Men Women

20 89.6 93.6 40 87.9 91.7 60 86.8 90.2 80 89.8 92.1 78 Annual Accounts Group

Mortality expectancy

Age Men Women

20 0.02 % 0.01 % 40 0.06 % 0.03 % 60 0.43 % 0.29 % 80 4.30 % 2.96 %

Disabillity expectancy

Age Men Women

20 0.10 % 0.10 % 40 0.20 % 0.30 % 60 1.90 % 2.90 %

Uncertainty over estimates Calculations of pension cost for the year and the book value of pension liability are based on the assumptions above. Considerable uncertainty attaches to the amounts calculated, which principally vary in pace with the level of interest rates in Norway.

The plan assets as of 31 December were invested as follows:

Investment category

2014 2013

Bonds 60 % 76 % Equity securities 29 % 4 % Properties 9 % 14 % Other 2 % 6 % Total 100 % 100 %

Pension assets are invested in bonds issued by the Norwegian government, Norwegian municipalities, financial institutions and corporations. Bonds held in foreign currencies are to a large extent currency hedged. Pension assets are invested both in Norwegian and foreign equity securities. The currency hedging policy for foreign equity securities is evaluated on an individual investment basis. Pension assets are invested in accordance with the guidelines applying to life insurance companies.

The group expects to pay approximately NOK 12.5 million in pension premiums to the group’s defined benefit plans in 2015.

The weighted average duration of the group’s pension liabilities as at 31 December 2013 was 23 years, and the maturity structure over the next 10 years is as follows:

NOK million

Year 1 42.7 Year 2 44.0 Year 3 46.2 Year 4 46.7 Year 5 49.2 Years 6-10 293.2

Sensitivity analysis The table below shows the estimated percentage change in pension liability and pension cost for the defined benefit pension schemes in Norway in the event of a one percentage point change in the most important parameters. This analysis has been carried out using a method that extrapolates the effect on pension liabilities of a change in the calculation parameters at the expiry of the reporting period. Annual Accounts Group 79

PBO Pension costs

Discount rate -1 % 14 % 22 % Discount rate +1 % -12 % -17 % Future salary inflation -1 % -0.5 % -8 % Future salary inflation +1 % 0.5 % 9 % Growth in the basic state pension (G) -1 % 0.1 % 0 % Growth in the basic state pension (G) +1 % -0.1 % 0 % Annual growth in pensions +1 % 12 % 14 %

Risk assessment The group is exposed to various risks in relation to its defined benefit pension arrangements as a result of uncertainty in relation to the assumptions applied and future outcomes. The most important areas of risk relate to increasing life expectancy, the risk of a reduction in the actual return earned on pension assets and risks associated with higher inflation and salary increases. Changes of this nature would cause an increase in liability for the group. However, risk exposure in this respect has been significantly reduced following the closure by the group of a number of defined benefit pension schemes over recent years.

Note 9 Employee share based schemes

The group established a share-based long-term remuneration program in 2011 for the members of executive management and certain other key employees. This program has been continued since 2011. The program takes the form of an annual remuneration program, which is subject to approval by the Board of Directors each year based on recommendations from the Compensation Committee. The employees who are included in the program receive a fixed payment depending on their position in the organisation. The net amount received after income tax must be used to buy shares in EVRY ASA. The members of the program are required to hold the shares purchased for a minimum period of three years, and a member must continue to be an employee throughout this period if he or she is to be entitled to retain the shares after the expiry of the remuneration program. The remuneration program applied to the members of executive management for 2014.

Note 10 Cost of goods sold and other operating costs

Cost of goods sold comprise:

NOK million 2014 2013

Purchase and lease of software 1 058.6 1 075.5 Purchase and lease of hardware 285.0 334.9 Consulting services 422.3 507.6 Network capacity 307.4 344.4 Use of goods for resale 1069.9 913.7 Other material costs 482.1 608.7 Total cost of goods sold 3 625.4 3 784.8 80 Annual Accounts Group

Other operating costs comprise:

NOK million 2014 2013

Premises rental and other premises costs 646.8 616.8 Consulting costs 424.4 409.9 Travel costs 208.0 180.9 Other operating costs 400.2 471.2 Total other operating costs 1 679.4 1 678.8

Consulting costs which are reinvoiced as a part of a customer contract are classified as cost of goods sold in the statement of comprehensive income. Other consulting costs are classified as other operating costs.

Auditor’s remuneration The following table shows remuneration to the group’s auditor, Ernst & Young AS, in respect of audit services delivered, including the amounts invoiced in respect of audit-related and tax-related services. The amounts shown include both norwegian and foreign subsidiaries, and are exclusive of value added tax.

NOK million 2014 2013

Audit fee 8.149 7.754 Assurance services 7.559 8.394 Taxrelated services 2.206 3.005 Other audit related services 1.028 0.536 Total remuneration 18.942 19.689

Assurance services includes attestation services related to ISAE 3402 and SAS 70. These expenses are mainly reinvoiced by the company.

N ote 11 Financial items

NOK million 2014 2013

Interest income 36.7 9.5 Other financial income 1.9 0.4 Total financial income 38.7 9.9

Interest expenses from continuing operations 168.1 161.3 Other financial expenses 17.0 27.7 Total financial expenses 185.1 189.0

Currency gains 405.0 347.6 Currency losses 346.0 337.8 Net foreign exchange gain 59.0 9.7 Annual Accounts Group 81

Note 12 Tax

Deferred tax/tax asset is calculated on the basis of the differences which exist at year-end between accounting and taxation values.

Deferred tax/tax asset arises in respect of the following timing differences as of 31 December:

NOK million 2014 2013

Intangible assets 1 338.4 1 272.5 Tangible assets -307.2 -343.3 Pension liabilities -138.1 -143.6 Profit and loss account 79.7 103.9 Items recognised as "comprehensive income" -107.2 -13.4 Other timing differences 49.9 124.4 Gross timing differences 915.5 1 000.6 Losses carried forward -880.7 -944.1 Basis for deferred tax/(deferred tax asset) 34.8 56.5

Deferred tax asset 3.7 3.6 Deferred tax 23.5 21.0

The taxation effect of items recognised as “Other income and costs” relates to changes in the market value of financial derivatives, pension estimat changes and to translation differences. The tax effect in respect of these items in 2014 amounted to NOK -15.0 million, NOK -11.3 million and NOK -2.0 million respectively. Corresponding amounts in 2013 where NOK 3.2 million, NOK -59.7 million and NOK 43.1 million respectively. The deferred tax asset in respect of these items amounted to NOK 27.8 million at 31 December 2014 and NOK 3.6 million at 31 December 2013.

The group had tax losses carried forward at 31 December 2014 totalling NOK 880.7 million, and the calculated deferred tax asset related to these losses amounted to NOK 233.0 million. The losses carried forward relate very largely to the operation of the Norwegian activities. There are no time limits to carrying forward these losses. Losses carried forward are mainly netted against positive timing differences in the norwegian and swedish activities. The deferred tax asset reported for the group relates almost entirely to activities carried out outside Norway and Sweden, since negative timing differences cannot be netted against net positive timing differences relating to activities in other countries. However, deferred tax assets totalling NOK 19.9 million relating to tax losses carried forward in the Danish subsidiary is not recognised in the accounts at 31 December 2014 since the company does not expect that the tax losses will be used in the foreseeable future. 82 Annual Accounts Group

Changes in deferred tax

NOK million 2014 2013

Change in deferred tax to profit and loss 28.6 -73.9 Other changes in deferred tax not taken to profit and loss -26.1 10.4 Change in deferred tax in the statement of financial position 2.5 -63.5

Tax cost for the year comprises Tax payable 61.4 71.4 Change in deferred tax 28.6 -73.9 Under/over accrual of tax prior year -4.1 - Total tax of the year from continuing operations 86.0 -2.5

Tax of the year from discontinued operations 2.8 -

Effect of permanent differences 27% (28% in 2013) of profit before tax -201.1 -14.9 Expenses not deductible 6.5 10.2 Non-deductible impairment of goodwill 314.4 15.1 Non-taxable income -7.7 -11.2 Losses/tax rate differences abroad -18.9 -6.9 Tax rate change in Norway - 0.3 Under/over accrual of tax prior year -4.1 - Other permanent differences -3.2 4.9 Tax of the year from continuing operations 86.0 -2.5

Effect of permanent differences from discontinued operations 2.8 -

Note 13 Earnings per share

Earnings per share is calculated as profit for the year attributable to shareholders (owners of the parent company) divided by the average weighted number of shares outstanding over the year.

NOK 2014 2013

Profit for the year attributable to shareholders (owners of the parent) -963 800 000 -14 800 000 Share of comprehensive income attributable to shareholders (owners of the parent) 92 700 000 -62 800 000 Total Profit for the year attributable to shareholders (owners of the parent) -871 100 000 -77 600 000

Average number of shares in the period 266 994 898 266 798 981 Effect of employee options - - Diluted average number of shares 266 994 898 266 798 981

Earnings per share (NOK) -3.26 -0.29

Dividend proposed for approval by the Annual General Meeting (not recognised as a liability at 31 December) Proposed total dividend payment (NOK) - 106 657 627 Proposed dividend per share - 0.40

In connection with the process whereby Lyngen Bidco AS has acquired 88% of the share capital of EVRY ASA, an Extraordinary General Meeting held on 23 March 2015 approved an extraordinary dividend of NOK 3.76 per share, equivalent to NOK 1,005 million. Annual Accounts Group 83

Note 14 Intangible assets

In-house Customer Developed contracts and other NOK million Goodwill Software intangible assets Total

Book value at 1 January 2013 6 827.1 166.0 246.3 7 239.3

Additions in the year 58.4 142.6 95.4 296.4 Disposal/reclassification in the year - - - - Depreciations - -68.8 -70.0 -138.8 Write-down -529.6 -10.5 - -540.1 Translation differences 228.9 4.6 6.4 240.0 Book value 31 December 2013 6 584.7 233.9 278.2 7 096.8

Additions in the year 13.5 92.6 117.1 223.2 Disposal/reclassification in the year - - -3.6 -3.6 Depreciations - -91.7 -75.3 -167.1 Write-down -1 164.3 -6.1 - -1 170.4 Translation differences 12.0 0.4 0.2 12.6 Book value 31 December 2014 5 446.0 229.0 316.5 5 991.4

yearly Useful life assesment 1-4 years 2 - 10 years

Weighted Method of depreciation cash flow Linear

Costs of NOK 92.6 million in respect of in-house developed software were capitalised in 2014, of which NOK 50.7 million related to investments carried out in the Financial Services segment. These investments are mainly related to the continuing development of new lending solutions, payment systems and self-service solutions for Nordic banks. Investments in customer contracts and other intangible assets totalled NOK 117.1 million in 2014. NOK 77 million of this related to Future Proof. Future Proof is an improvement program in the outsourcing area, in which standardisation, automation and offshoring are central components.

Other development work carriedout in the Group relates to customer-specific projects, where the income derived from these projects exceeds the development costs. Accordingly, no material amount of cost for research and development was recognised in 2014.

Allocation of goodwill to cash-generating units as of 31 December:

NOK million 2014 2013

Nordic Operations - 403.4 Financial Services 1 612.7 1 612.7 Norway 1 674.6 2 370.4 Sweden 1 596.6 1 563.5 Other Business - 65.1 BEKK Consulting 381.8 381.8 Global Sourcing 180.3 187.8 Total 5 446.0 6 584.7

The group evaluates whether there are any indications of a possible impairment of goodwill on a quarterly basis. The group also tests goodwill for impairment at other times if this becomes necessary as a result of indications of possible impairment, and such tests are always carried out at year-end. Goodwill is tested for impairment for each identified cash generating unit in the group. A “cash generating unit” represents the lowest identifiable group of assets that generates cash inflow while being for all practical purposes independent of cash inflow generated by other assets or other groups of assets. The number of cash generating units in 2014 was 7, unchanged for 2013, and in line with the group’s business area structure.

84 Annual Accounts Group

The group has during the second half of 2014 been involved in a strategic process where Lyngen Bidco AS, a company indirectly controlled by private equity funds managed by Apax Partners LLP, launched a voluntary bid for the entire share capital of EVRY ASA at a price of NOK 16 per share. Following the end of the offer period, Lyngen Bidco AS acquired 16 March 2015 234,797,184 shares in EVRY ASA, equivalent to 88% of the total share capital. The group has during the second half of 2014 been involved in a strategic process where Lyngen Bidco AS, a company indirectly controlled by private equity funds managed by Apax Partners LLP, launched a voluntary bid for the entire share capital of EVRY ASA at a price of NOK 16 per share. Following the end of the offer period, Lyngen Bidco AS acquired 16 March 2015 234,797,184 shares in EVRY ASA, equivalent to 88% of the total share capital. A transaction price of NOK 16 per share corresponds to a value of the group’s equity of NOK 4,277.4 million. An external transaction price must be given considerable weight by a value test of goodwill and is a strong indicator. In this case, value in use is set equal to the transaction price of NOK 16 per share. This gives an impairment of NOK 1,164.3 million at 31 December 2014. Based on reported financial results, it is goodwill related to the cash-generating units Nordic Operations, Norway and Other Business, which are impaired.

Note 15 Property, plant and equipment

Improvements to leased Machinery/ IT NOK million premises 1) fixtures1) Vehicles equipment Total

Acquisition cost 1 January 2013 236.6 734.8 0.6 3 064.3 4 036.7 Reclassifications 0.0 -5.7 0.1 -63.3 -68.9 Additions 8.3 60.9 0.4 332.7 402.3 Disposals -1.1 -26.4 - -82.1 -109.6 Translation differences 0.1 17.1 - 35.2 52.4 Acquisition cost 31 December 2013 243.9 780.7 1.1 3 286.8 4 312.9 Reclassifications 3.8 -5.9 0.3 -9.2 -11.0 Additions - 68.1 1.0 211.9 280.9 Disposals -49.6 -145.3 -0.1 -1 684.5 -1 879.5 Translation differences 0.1 6.2 - 13.9 20.2 Acquisition cost 31 December 2014 198.3 703.8 2.3 1 818.8 2 723.5

Accumulated depreciation/write-down 1 January 2013 164.7 465.9 0.6 2 484.0 3 115.2 Reclassifications 0.8 -4.1 - -66.0 -69.3 Depreciations 10.9 68.8 0.1 275.2 355.0 Disposals - -23.1 - -79.7 -102.9 Translation differences 0.1 14.0 - 29.9 43.9 Accumulated depreciation/write-down 31 December 2013 176.4 521.5 0.7 2 643.4 3 342.0 Reclassifications 5.0 -8.7 0.1 -7.3 -10.9 Depreciations 17.1 62.6 0.2 266.8 346.7 Disposals -50.5 -141.8 -0.1 -1 602.3 -1 794.7 Translation differences 0.1 3.1 -0.1 1.6 4.8 Accumulated depreciation/write-down 31 December 2014 148.1 436.7 0.9 1 302.2 1 887.9

Depreciation rates 10-20 % 15-30 % 20% 20-33 % Depreciation method Linear Linear Linear Linear

Book value 31 December 2014 50.1 267.0 1.5 516.7 835.5 31 December 2013 67.5 259.2 0.4 640.9 968.3

1) Fixtures and fittings in leased premises are depreciated over the residual period of the lease if this is shorter than the normal depreciation period.

Book value of IT-equipment financed with financial lease amouted to NOK 36.2 million as of 31 December 2014. Annual Accounts Group 85

Interests in subsidiaries, associated Note 16 companies and joint ventures

Shares in subsidiaries owned by parent company

Registered Ownership Voting office share share

EVRY Norge AS Oslo 100 % 100 % EVRY Nordic Operations AS Oslo 100 % 100 % Stockholm, EVRY Sverige AB Sweden 100 % 100 % EVRY Card Services AS Mo i Rana 100 % 100 % EVRY Danmark A/S Viborg, Denmark 1) 90.7 % 100 % EVRY Økonomitjenester AS Oslo 100 % 100 %

1) The parent company controls 9.3 % of EVRY Danmark A/S through the wholly-owned subsidiary EVRY Norge AS.

In addition to subsidiaries owned by the parent company, the following material companies are consolidated in the group accounts in accordance with the past equity method:

Registered Ownership Voting Company office share share

EVRY AB Stockholm, Sweden 100 % 100 % EVRY Consulting Group AB Stockholm, Sweden 100 % 100 % EVRY Card Services AB Stockholm, Sweden 100 % 100 % Infopulse Ukraine LLC Kiev, Ukraina 100 % 100 % Span Infotech (India) Private Limited Bangalore, India 100 % 100 % Span Systems Corporation Inc New Jersey, USA 100 % 100 % Eye-Share AS Stavanger 100 % 100 % Bekk Consulting AS Oslo 100 % 100 % EVRY Lesswire Solutions AB Karlstad, Sweden 100 % 100 % EVRY Healthcare Systems AB Huskvarna, Sweden 100 % 100 % EVRY One Outsourcing Services Uppsala AB Uppsala, Sweden 100 % 100 % EVRY One Outsourcing Services Malmö AB Huskvarna, Sweden 100 % 100 % EVRY One Borås AB Borås, Sweden 100 % 100 %

Shares in associated companies:

Ownership Book value Company Country share (000 NOK)

Gecko Informasjonssystemer AS Norway 34 % 364 InOne Europè AG Germany 39 % 159

Gecko Informasjons- (000 NOK) systemer AS InOne Europè AG

Book value at 1 January 2014 954 157 The group's share of this years profit -454 - Share dividends -136 - Effect of currency fluctuations - 2 Book value 31 December 2014 364 159

86 Annual Accounts Group

Summarised financial information for individual associated companies 1 January to 31 December 2014 (000 NOK):

Operating Profit for Company Assets Liabilities Equity revenue the year

Gecko Informasjonssystemer AS 14 163 10 845 3 317 23 126 -1 569 InOne Europè AG 489 14 475 - -

Shares in associated companies are recognized in the consolidated accounts in accordance with the equity method.

The group has a 50 % share in the joint venture Buypass AS. The other 50 % share is held by Norsk Tipping AS.

Ownership Company Country share

Buypass AS Norway 50%

The group’s 50 % interest in Buypass AS was recognised in 2013 by the gross consolidation method. Due to the implementation of IFRS 11 with effect from 1 January 2014, the 50 % interest is recognised in accordance with the equity method in the 2014 accounts.

Buypass AS

NOK million 31.12.2014 1.1.2014

Current assets 279.1 304.1 Non-current assets 16.6 15.0 Current liabilities 155.3 198.1 Non-current liabilities 6.4 - Equity 134.0 121.1 Group's carrying amount of the investment 67.0 60.5

NOK million 2014 2013

Operating revenue 262.9 157.8 Operating costs 207.1 124.8 Profit for the year 42.0 25.5 Group's share of profit for the year 21.0 12.8 Annual Accounts Group 87

N ote 17 Accounts receivable

Accounts receivable are recognised at their nominal value less a provision for losses. See also note 22.

NOK million 31.12.2014 31.12.2013

Gross outstanding 1 974.0 1 965.2 Provision for losses on receivables -7.7 -8.4 Net accounts receivable 1 966.3 1 956.8

Loss on receivables to profit and loss 2.6 2.6

Age distribution accounts receivable

More than Less than 30 - 60 days 61 - 90 days 180 days NOK million Not overdue 30 days overdue overdue overdue 91 - 180 days overdue

31 December 2014 74 % 18 % 2 % 2 % 4 % 0 % 31 December 2013 73 % 19 % 2 % 2 % 4 % 0 %

Note 18 Other receivables

Other non-current receivables

NOK million 31.12.2014 31.12.2013

Implementation projects 192.1 136.8 Other non-current receivables 14.6 6.5 Total other non-current receivables 206.6 143.3

Other current receivables

NOK million 31.12.2014 31.12.2013

Deferred income 202.5 355.0 Implementation projects 165.2 174.7 Prepaid costs 462.6 532.2 Advance income tax 96.1 67.4 Other current receivables 48.8 43.4 Total other current receivables 975.2 1 172.7 88 Annual Accounts Group

Note 19 Bank deposits/guarantee liabilities

EVRY has established a group bank account system whereby EVRY ASA operates the group account, while other group companies are sub-account holders. The bank nets all balances and withdrawals to create a net position that represents the credit or debit balance between DNB Bank ASA and EVRY ASA.

The group has issued a guarantee in respect of tax deductions from salaries due to the tax authorities. The guarantee amount was NOK 243.5 million at 31 December 2014. Other bank guarantees amounted to NOK 130.2 million at 31 December 2014, including a guarantee of NOK 62 mill in favour of Norsk Tillitsmann Pensjon AS as collateral for employees’ accrued compensation rights arising from the transition from defined benefit to defined contribution pension arrangements.

EVRY ASA has issued parent company guarantees on behalf of its subsidiary companies amounting to NOK 1,018 million.

The group has no restricted deposits at 31 December 2014.

Note 20 Share capital, shareholders etc.

The share capital of EVRY ASA consists of:

Par value Book value Number (NOK) (NOK)

Ordinary shares (fully paid-up) 1 January 2014 267 338 981 1.75 467 843 217 Ordinary shares (fully paid-up) 31 December 2014 267 338 981 1.75 467 843 217

Holdings of own shares at nominal value 1 January 2014 385 087 1.75 673 902 Purchase own shares - 1.75 - Sale own shares -82 007 1.75 -143 512 Holdings of own shares at nominal value 31 December 2014 303 080 1.75 530 390

Outstanding shares 31 December 2014 267 035 901

The company has only one class of shares. All shares in the company have equal voting rights and equal rights to dividends.

In accordance with the company’s Articles of Association, the number of shares is the same as the number of ordinary shares issued and fully paid-up.

The company had 3,298 shareholders at the close of the year, and 88.6 % of the shares were held by Norwegian shareholders.

As communicated by a stock exchange announcement on 8 December 2014, Lyngen Bidco AS, a company indirectly controlled by private equity funds managed by Apax Partners LLP, launched a voluntary bid for the entire share capital of EVRY ASA at a price of NOK 16 per share. Following the end of the offer period, Lyngen Bidco AS acquired 234,797,184 shares in EVRY ASA, equivalent to ~88% of the total share capital. Annual Accounts Group 89

The 20 largest shareholders at 31 December 2014 were as follows:

Shareholder Interest

Posten Norge AS 40.0 % Telenor Business Partner Invest AS 30.2 % Jpmorgan Chase Bank, n.a 4.9 % Arendals Fossekompani ASA 4.4 % Folketrygdfondet 3.2 % Skandinaviska Enskilda Banken AB 1.9 % KLP Aksje Norge VPF 1.6 % UBS AG, London Branch 1.3 % Kommunal Landspensjonskasse 1.2 % Nordea Nordic Small Cap Fund 1.1 % The Bank of New York Mellon SA/NV 1.0 % MP Pensjon PK 0.7 % MSIP Equity 0.5 % Ulsmo Finans AS 0.4 % Storebrand Norge I 0.3 % VPF Nordea Norge Verdi 0.3 % Deutsche Bank AG 0.2 % Morgan Stanley & Co. International 0.2 % Terje Mjøs 0.2 % The Bank of New York Mellon SA/NV 0.2 % Total 93.9 %

The following members of the Board of Directors hold shares as of 31 December 2014:

Name Number of shares

Eirik Bornø 10 731 Jan Dahlstöm 1 212 Ola Hugo Jordhøy 2 313 Ingrid Lund 5 534

The following members of executive management hold shares as of 31 December 2014:

Name Number of shares

Terje Mjøs (CEO) 535 461 Knut E. Røsjorde 7 807 Niclas Ekblad 153 968 Håvard Larsen 93 389 Wiljar Nesse 112 851 Morten Søgård 85 886 Kurt Helland 9 889 Anne-Cecilie Fagerlie 19 555

Authorisation for the Board to acquire own shares Pursuant to Section 9-4 of the Public Limited Companies Act, the Board of Directors is authorised to acquire own shares in the company. The authorisation is limited to a total nominal value of NOK 8,750,000. The company may not at any time acquire shares in such way that the total nominal value of the shares owned by the company after the acquisitions exceeds 10% of the company’s share capital. The price at which shares are acquired must be at least NOK 1.75 per share and the price must not exceed NOK 100 per share. The company’s holdings of its own shares will only be used in connection with meetings its liabilities in respect of share purchase scheme for employees. The company’s purchase and sales of its own shares shall take place through stock exchange. This authorisation is valid until the date of the next Annual General Meeting, but in any case no longer than until 1 June 2015. 90 Annual Accounts Group

Note 21 Other current liabilities

NOK million 31.12.2014 31.12.2013

Accrued expenses 164.0 218.2 Pre-invoiced to customers 228.7 196.8 Provisions 132.7 101.9 Current liabilities financial lease 3.0 3.0 Other current liabilities 233.3 164.7 Total other current liabilities 761.7 684.6

Note 22 Provisions

Provisions for losses on accounts Onerous- Other NOK million receivable contracts Restructuring Premises provisions Total

Book value at 1 January 2013 10.4 53.9 97.7 23.6 2.3 187.8 Provisions made in 2013 6.2 - 32.1 11.0 6.2 55.5 Provisions applied in 2013 -8.4 -23.8 -77.9 -8.7 -2.4 -121.2 Unused provisions ------Translation differences 0.2 - 2.1 - - 2.3 Book value at 31 December 2013 8.4 30.1 54.1 25.9 6.1 124.5

Provisions made in 2014 1.5 - 120.1 - 1.1 122.8 Provisions applied in 2014 -2.3 -4.3 -74.9 -19.4 -0.1 -101.0 Unused provisions ------Translation differences - - 1.1 - 1.2 2.3 Book value at 31 December 2014 7.7 25.8 100.4 6.5 8.2 148.5

Current at 31 December 2014 7.7 25.8 100.4 6.5 - 140.4 Current at 31 December 2013 8.4 30.1 54.1 17.7 - 110.2

Non-current at 31 December 2014 - - - - 8.2 8.2 Non-current at 31 December 2013 - - - 8.2 6.1 14.3

Provisions for losses on accounts receivable Provisions for estimated losses on accounts receivable are recognised to the statement of comprehensive income when a loss event occurs and there is objective evidence that the value of the asset is impaired.

Onerous contracts The provision at 31 December 2014 relates to the group’s DigOff solution. The Board of Directors of EVRY ASA decided in 2012 that the DigOff solution would not be sold to additional customers, but that the company would continue to carry out the existing contracts for this solution. This decision was based on an overall evaluation of both risk and market prospects associated with additional sales of this solution.

Restructuring Capacity adjustments were carried out in the Norway segment in 2014 as a consequence of challenges in the local market for consulting services, which were principally driven by the slowdown in the oil sector as well as by the loss of revenue from DNB. Capacity adjustments were also carried out in the Sweden segment as a consequence of chal- lenging conditions in the market for consulting services provided to large customers. Provisions have been made in relation to the reductions in headcount in these segments as a result of these capacity adjustments.

Annual Accounts Group 91

Provisions related to personnel are classified as restructuring in the above table, while provisions related to closing locations are classified as premises costs.

Premises Provision is made for premises leases where the premises are not used or are sub-let at a loss.

Note 23 Leasing contracts

Group as lessee – financial leasing The group has entered into financial leasing contracts for software. Software that is an integrated part of IT equipment is classified as part of fixed assets in the statement of financial position.

Assets leased under financial leasing contracts are as follows:

NOK million 2014 2013

IT equipment 36.2 48.8 Premises (data center) 32.0 36.2 Software - 3.1 Net book value 68.2 88.1

Future minimum lease payments: Up to 1 year 4.2 4.3 1 to 5 years 15.5 16.0 After 5 years 13.5 17.2 Total future minimum lease payments 33.1 37.5

Interest -4.8 -6.0 Present value of future minimum lease payments 28.3 31.5

Of which: - current liabilities 3.1 3.1 - non current liabilities 25.2 28.3

These leasing contracts do not impose any restrictions on the company’s dividend policy or financing arrangements.

Group as leasee – operational leasing The group has entered into a number of operational leasing contracts for software, IT equipment, office premises and other facilities. The majority of these leasing contracts include options to extend. There are no restrictions to the Group’s dividend or financing opportunities in the relation with these leasing contracts.

Leasing costs are made up as follows:

NOK million 2014

Office premises 434.8 Software 979.5 IT equipment, vehicles and other 345.2 Network capacity 307.4 Total leasing costs 2 067.0 92 Annual Accounts Group

The minimum future lease payments in respect of contracts with no cancellation option fall due as follows:

NOK million 2014

Up to 1 year 1 191.2 1 to 5 years 1 737.2 After 5 years 410.3 Total future minimum lease payments 3 338.7

Significant lease agreements Mainframe platform EVRY continues to invest in its mainframe platform, and in late 2012 upgraded its machine park with the most advanced technology and additional capacity. The new equipment is supplied on an operational lease by IBM Global Finance. The platform has a long technical life, subject to cyclical updating when new models are released in the future. The lease agreement can be adjusted to accommodate new upgrades. The total financial cost and unit costs show a falling trend when upgrading to new models. EVRY has an option to purchase the equipment at market value at a future date.

Premises lease, Skøyen, Oslo The lease expires in 2019. The rent is increased annually in line with CPI. Rental payments are based on total2 m . The tenant is responsible for maintaining the interior of the premises at the original standard. Total area of premises is 51.000 m2, whereas 18.600 m2 is subleased. The agreement may be extended by three further periods, each of 5 years.

Premises lease, Solna, Sweden The lease expires in 2016. The rent is increased annually in line with CPI. Rental payments are based on total2 m . The tenant is responsible for maintaining the interior of the premises at the original standard.

Premises lease, Sandslimarka, Bergen The lease expires in 2018. The rent is increased annually in line with CPI. Rental payments are based on total2 m . The tenant is responsible for maintaining the interior of the premises at the original standard.

Ground rent lease, Horten Ground rent lease with Horten Næringspark with a term of 80 years. Ground rent payments are adjusted every 10 years in line with CPI.

Financial lease agreement, Gjøvik The group has entered into a financial lease agreement for its underground data hall at Gjøvik. The premises are leased from Industribygg AS. The company has the right to assume ownership of the premises at any time upon payment of the remaining balance, or will assume ownership in 2023 without payment.

Premises lease, Fornebu, Bærum The company has decided to lease new headquarters premises at Snarøyveien 30 in Bærum. It has signed a 10-year lease agreement that commences on 1 January 2014. The company will be responsible for internal maintenance of the premises, and the lease rental will be calculated on the basis of area with annual adjustment for inflation. The premises amount to 27,000 2m .

Note 24 Classification of financial instruments and determination of fair value

Fair value hierarchy Financial instruments that are valued at fair value in the statement of financial position are grouped on the basis of the following fair value hierarchy, which applies three levels/groups for financial instruments. The levels/groups reflect the information used for the determination of fair value.

Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2: Instruments for which observable information is available, but for which there is no active market. Level 3: Instruments for which there is no observable market data and the determination of fair value accordingly uses company specific/subjective information. Annual Accounts Group 93

As of 31 December 2014:

Fair Fair value Fair value through Loans and Other Total value through profit Receiv- Available financial book NOK million level OCI and loss ables for sale liabilities value Fair value

Assets Non-current interest bearing receivables - - 1.6 - - 1.6 1.6 Other non current receivables - - 204.9 - - 204.9 204.9 Accounts receivable - - 1 966.3 - - 1 966.3 1 966.3 Other current receivables - - 975.2 - - 975.2 975.2 Bank deposits - - 615.6 - - 615.6 615.6 Total assets - - 3 763.6 - - 3 763.6 3 763.6

Liabilities Non-current interst bearing liabilities - - - - 3 181.3 3 181.3 3 181.3 Non-current non-iterest bearing liabilities 2 74.8 - - 5.8 80.6 80.6 Accounts payable - - - - 885.1 885.1 885.1 Deductions and duties payable - - - - 1 187.1 1 187.1 1 187.1 Other current liabilities - - - - 761.7 761.7 761.7 Total liabilities 74.8 - - - 6 021.1 6 095.9 6 095.9

During the reporting period 1 January 2014 to 31 December 2014, there were no transfers between the levels in the fair value hierarchy.

As of 31 December 2013:

Fair Fair value Fair value through Loans and Other Total value through profit Receiv- Available financial book NOK million level OCI and loss ables for sale liabilities value Fair value

Assets Non-current interest bearing receivables - - 2.0 - - 2.0 2.0 Other non current receivables - - 141.3 - - 141.3 141.3 Accounts receivable - - 1 956.8 - - 1 956.8 1 956.8 Other current receivables - - 1 172.7 - - 1 172.7 1 172.7 Bank deposits - - 558.0 - - 558.0 558.0 Total assets - - 3 830.8 - - 3 830.8 3 830.8

Liabilities Non-current interst bearing liabilities - - - - 3 520.7 3 520.7 3 520.7 Non-current non-iterest bearing liabilities 2 19.3 - - 58.4 77.7 77.7 Accounts payable - - - - 917.7 917.7 917.7 Deductions and duties payable - - - - 1 186.9 1 186.9 1 186.9 Other current liabilities - - - - 684.6 684.6 684.6 Total liabilities 19.3 - - - 6 368.4 6 387.7 6 387.7

During the reporting period 1 January 2013 to 31 December 2013, there were no transfers between the levels in the fair value hierarchy. 94 Annual Accounts Group

Note 25 Discountinued Operations

It is at the end of December 2014 decided that the SAP operations of EVRY Denmark A/S would undergo controlled closure. Because of this, the operating result for the company has been stated separately in accordance with IFRS 5 and is shown as a separate line entry in the income statement: “Profit after tax from discontinued operations”. The operation is similarly no longer included as part of the EVRY Norway segment.

The result for EVRY Danmark A/S are presented below

NOK million 2014 2013

Revenues 86.1 81.9 Expenses 124.2 107.8 Operating profit -38.1 -25.9 Net financial items -1.4 -0.9 Profit/(loss) before tax from a discontinued operations -42.3 -25.9

NOK million 31.12.2014 31.12.2013

Non-current assets 2.5 11.9 Current assets 19.9 22.9 Total assets 22.4 34.8

Equity -41.3 -23.9 Non-current liabilities - 15.0 Current liabilities 63.7 43.7 Total equity and liabilities 22.4 34.8

NOK mill 2014 2013

Operating -18,0 5,9 Investing - -5,9 Financing 11,2 - Net cash flow -6,8 -

Note 26 Related parties

Posten Norge AS and Telenor Business Partner Invest AS owned 40.0 % and 30.2 % respectively of the shares and voting rights of EVRY ASA as of 31 december 2014. The group is party to agreements for the sale of services to a number of companies in both the Posten group and the Telenor group.

Services delivered by the group to companies in the Posten group and to companies in the Telenor group relate principally to operating services for business critical IT systems, including mainframe, UNIX, networks solutions and office solutions platforms. Services purchased by the group principally from companies in the Posten group relate in the main to freight and distribution. Services purchased by the EVRY group principally from companies in the Telenor group relate in the main to communication services, network services and telephony.

All transactions with the Posten group and with the Telenor group are carried out on normal arm’s length commercial terms. There are no guarantees for sales to any of the companies in either the Posten group or the Telenor group.

Guarantees issued by Posten Norge AS on behalf of EVRY ASA or by subsidiary companies amounted to NOK 160.0 million at 31 December 2014. Annual Accounts Group 95

Transactions with Posten-companies

NOK million 2014 2013

Revenues 543.6 663.8 Purchases 173.2 140.5

Transactions with Telenor-companies

NOK million 2014 2013

Revenues 436.0 453.8 Purchases 421.5 341.2

Outstanding accounts with Posten-companies

NOK million 31.12.2014 31.12.2013

Receivables 125.7 88.6 Payables 11.9 19.1

Outstanding accounts with Telenor-companies

NOK million 31.12.2014 31.12.2013

Receivables 102.3 59.9 Payables 54.6 67.7

No provisions have been made for losses in relation to outstanding accounts with companies in the Posten group or companies in the Telenor group.

The Telenor Pension Fund (Telenor Pensjonskasse) carries out administration of part of the pension assets for EVRY.

For information about remuneration to executive management and the board of directors, see note 7.

Note 27 Disputes and other legal matters

EVRY is involved from time to time in a number of disputes/legal proceedings in connection with deliveries of products and the interpretation of contracts. While the outcome of these matters is uncertain, management is of the opinion that, on the basis of the information currently available, these matters will be resolved without causing any material impairment to the group’s financial position. Where the group considers it likely that a dispute will result in a payment to a third party, the appropriate provision is made in the accounts on the basis of management’s best estimate.

Note 28 Events after balance sheet date

There has been no events after the balance sheet date that have a material effect on the financial statement for 2014. 96 Annual Accounts EVRY ASA

EVRY ASA Statement of comprehensive income 1 January - 31 December

NOK million Note 2014 2013

Total operating revenue - 0.7

Salaries and personnel costs 2,3 4.5 14.0 Other operating costs 5 58.7 3.4 Total operating costs 63.2 17.4

Operating profit -63.2 -16.7

Income from investment in subsidiaries 4 138.5 196.0 Other financial income 6 481.4 322.8 Financial expenses 6 564.7 362.5 Net financial items 55.3 156.2

Profit before tax -8.0 139.6

Tax on profit 7 75.2 56.7 Profit for the year -83.2 82.9

Comprehensive income Items which will not be reclassified over profit and loss (after tax) Actuarial gains (losses) on defined benefit pension plans -0.8 -0.9

Items which may be reclassified over profit and loss in subsequent periods (after tax) Cash flow hedges -40.5 11.3 Total comprehensive income -41.3 10.3

Total profit for the year -124.5 93.2 Annual Accounts EVRY ASA 97

EVRY ASA Statement of financial position As of 31 December

NOK million Note 31.12.2014 31.12.2013

Non-current assets Investments in subsidiaries 9 6 004.7 5 340.0 Other non-current shareholdings 0.4 0.4 Pension assets 3 0.2 1.1 Non-current interest bearing receivables 10 2 258.3 2 273.0 Total financial non-current assets 8 263.7 7 614.6 Total non-current assets 8 263.7 7 614.6

Current assets Other current receivables 10 139.6 138.1 Bank deposits 8 -454.9 776.3 Total current assets -315.3 914.3 Total assets 7 948.4 8 528.9

Equity Share capital 11 467.8 467.8 Own shares 11 -0.5 -0.7 Paid-in other equity 3 197.4 3 196.7 Total paid-in equity 3 664.7 3 663.9 Other equity 612.8 1 218.8 Total equity 4 277.4 4 882.7

Liabilities Non-current interest bearing liabilities 10,12 3 151.3 3 486.3 Non-current non-interest bearing liailities 10 81.9 19.3 Deferred tax liabilities 7 20.7 43.0 Total non-current liabilities 3 253.9 3 548.7

Accounts payable 19.5 0.7 Deductions and duties payable -2.9 1.4 Other current liabilities 10 400.5 95.5 Total current liabilities 417.1 97.6 Total liabilities 3 671.0 3 646.2 Total liabilities and equity 7 948.4 8 528.8

Bærum, 21 April 2015, Board of Directors of EVRY ASA

Jo Lunder Salim Nathoo Ellen de Kreij Louise Sondergaard Rohan Haldea Zehavit Cohen Chairman of the Board Deputy Chairman

Göran Lindahl Jan Dahlström Eirik Bornø Ola Hugo Jordhøy Ingrid Lund Björn Ivroth Chief Executive Officer 98 Annual Accounts EVRY ASA

EVRY ASA Statement of cash flow 1 January - 31 December

NOK million 2014 2013

Cash from/to operations: Profit before tax -8.0 139.6 Share of profit/loss in subsidiaries/associated companies -138.5 -196.0 Tax paid in the period 2.8 0.0 Write-down of shares in subsidiaries 254.6 117.5 Interest income / - expenses -171.3 -77.7 Paid interests -56.8 -34.5 Difference between pension cost and payments -0.2 -14.4 Change in accounts payable 18.8 0.4 Change in other accruals 58.8 5.6 Net cash flow from operations -39.7 -59.5

Cash from/to investments: Investment in group companies -1 048.0 -1.1 Sale of group companies - - Net cash flow from investments -1 048.0 -1.1

Cash from/to financing: New borrowing (short and long-term) 400.0 609.1 Borrowings repaid -760.5 - Dividends paid -106.8 -93.3 Purchase / sale of own shares - -3.1 Group contribution received/paid 46.9 293.6 Net cash flow from financing -420.4 806.3

Net change in liquid assets over the year -1 508.2 745.7 Bank deposits at 1.1. 776.3 -55.8 Currency movements in liquid assets 277.0 86.4 Bank deposits at 31.12. -454.9 776.3 Annual Accounts EVRY ASA 99

EVRY ASA Statement of changes in equity 1 January - 31 December

Paid-in other Other Total NOK million Share capital Own shares equity equity equity

Equity at 01 January 2013 467.8 -1.2 3 194.4 1 218.9 4 879.9

Purchase of own shares 0.5 2.3 0.0 2.9 Dividend -93.3 -93.3 Comprehensive income 10.3 10.3 Profit for the year 2013 82.9 82.9 Equity at 31 December 2013 467.8 -0.7 3 196.7 1 218.8 4 882.7

Purchase of own shares 0.1 0.7 0.5 1.3 Dividend -106.8 -106.8 Merger (Group continuity) -375.3 -375.3 Comprehensive income -41.3 -41.3 Profit for the year 2014 -83.2 -83.2 Equity at 31 December 2014 467.8 -0.5 3 197.4 612.8 4 277.4 100 Annual Accounts EVRY ASA

EVRY ASA Notes to Financial Accounts

Note 1 Accounting principles

The accounts of EVRY ASA are prepared in accordance with the regulation in the Norwegian Accounting Act that allow simplified application of International Financial Reporting Standards, cf. Regulation no 0057 of 21 January 2008. This means that the accounting principles are the same as in the group accounts, while the disclosures are in accordance with the Norwegian Accounting Act.

Shares in subsidiaries are recognised in the company’s unconsolidated accounts in accordance with the cost method. Dividends and other profit distributions accrued for in these companies are recognised as financial income in the period to the extent that they result from profits earned during the period of ownership.

For information about accounting principles, see group accounts note 1.

Note 2 Salaries and personnel costs

NOK million 2014 2013

Salaries and remuneration to Board of Directors 4.0 16.5 Social security tax 0.5 2.9 Pension costs - 1.4 Charged other units - -6.8 Total salaries and personnel costs 4.5 14.0

The company did not have any employees in 2014. All of the employees was transferred to the subsidiary EVRY Norge AS with effect from 1 July 2013.

See note 7 - Group regarding remuneration to executive management and Board of Directors.

Note 3 Pensions

The company’s defined benefit occupational pension scheme is closed to new members, and has 13 retired members.

The group implemented the revised accounting standard IAS 19, which regulates the accounting treatment of pension liabilities and other employee benefits, with effect from 1 January 2013. The major change caused by the revised standard is that the “corridor method” can no longer be applied, and the effect of any changes in actuarial estimates must instead be recognised in full as part of the reporting of other income and costs in the period in which they arise. A further important change is that the expected return on pension assets must be calculated by using the interest rate applied to discount net pension liabilities or net pension assets. The difference between the actual return on pension assets and the return calculated using the discount rate is treated as a change in actuarial estimates that is recognised as part of other comprehensive income. The implementation of the changes has resulted in a reduction in pension liabilities of NOK 4.2 million as per 1 January 2013.

The effect for the year of actuarial gains and losses recognised as comprehensive income represented an increase in pension liability of NOK 1.1 million. Annual Accounts EVRY ASA 101

Pension costs

NOK million 2014 2013

Service cost - 1.2 Net interest on pension liabilities - -0.2 Pension costs charged to profit and loss from defined benefit plans - 1.1 Additional schemes - 0.4 Pension costs charged to profit and loss - 1.4

Actual return on plan assets were NOK 3.0 million in 2014.

Pension liabilities as of 31 December

NOK million 2014 2013

Gross pension liability 22.9 17.2 Plan assets -23.1 -21.1 Effect of asset ceiling - 2.8 Net pension liability -0.2 -1.1

Plan assets in the statement of financial position 0.2 1.1 Pension liabilities in the statement of financial position - -

Social security tax is included in pension costs and in net pension liabillity. It is not shown separately, but included in gross pension expense and gross pension liability.

The assumptions used for pension calculations follow the guidelines issued by the Norwegian Accounting Standards Board (NRS) as at 31 December.

The plan assets as of 31 December were invested as follows:

Investment category

2014 2013

Bonds 55 % 76 % Equity securities 36 % 4 % Properties 7 % 14 % Other 2 % 6 % Total 100 % 100 %

Note 4 Income from investment in subsidiaries

Income from investment in subsidiaries in 2014 relates to received group contribution and dividends from equity accumulated during the period of ownership by the parent company.

Income from investment in subsidiaries in 2013 relates to received group contribution from equity accumulated during the period of ownership by the parent company, as well as liquidation of a subsidiary. 102 Annual Accounts EVRY ASA

Note 5 Other operating costs

Other operating costs comprise:

NOK million 2014 2013

Consultant costs 57.3 1.6 Other operating costs 1.5 1.8 Total other operating costs 58.7 3.4

Consultant cost in 2014 are mainly related to the strategic process that the company has been involved in during the second half of 2014.

NOK million 2014 2013

Audit fee 1.067 0.960 Other audit related services 0.812 0.242 Assurance services - - Tax related services 0.086 0.081 Total auditor's remuneration 1.965 1.283

Note 6 Financial items

NOK million 2014 2013

Intra-group interest income 114.9 168.2 External interest income 30.9 5.3 Currency gains 335.7 149.3 Total other financial income 481.4 322.8

Intra-group interest expenses 31.9 39.1 External interest expenses 163.3 151.8 Currency losses 58.6 35.4 Write-down of shares in subsidiaries 254.6 117.5 Other 56.4 18.7 Total other financial expenses 564.7 362.5

Note 7 Tax

Deferred tax is calculated on the basis of the differences which exists at year-end between accounting and taxation values.

Deferred tax arises in respect of the following differences as of 31 December: Annual Accounts EVRY ASA 103

NOK million 2014 2013

Provisions -37.1 -6.5 Pension liabilities 0.2 1.1 Financial instruments -74.8 -19.3 Non-current receivables/loans 188.4 177.6 Gross timing differences 76.7 152.9

Deferred tax/(deferred tax asset) 20.7 41.3

Calculation of tax base for the year Profit before tax -8.0 139.6 Permanent differences 297.1 68.8 Change in timing differences to profit & loss 19.6 -124.2 Change in previous year's Group Contribution - 0.6 Losses carried forward - -7.3 Group Contribution given -308.7 -77.4 Basis for tax payable - -

An amount for group contribution was recognised in the accounts for 2013 that relates to a change in group contribution recorded after the approval of the accounts for the preceding years.

NOK million 2014 2013

Tax cost for the year comprises Tax payable 83.3 21.7 Change in deferred tax -5.3 35.0 Change in tax payable previous years -2.8 0.0 Total tax cost 75.2 56.7

Changes in deferred tax Change in deferred tax to profit & loss -5.3 35.0 Tax on equity transactions -15.3 4.3 Change in deferred tax -20.6 39.3

Effect of permanent differences 27% (28% in 2013) of profit before tax -2.2 39.1 Tax rate change - -1.8 Expenses not deductible 80.2 19.5 Change in tax payable previous years -2.8 - Tax for the year 75.2 56.7

Note 8 Guarantees issued and contractual commitments

The parent company has issued a guarantee of NOK 450.0 million for borrowings by subsidiaries as part of the group cash management account arrangements.

EVRY ASA has issued a guarantee in respect of tax deductions from salaries due to the tax authorities. The guarantee amount was NOK 243.5 million at 31 December 2014. Other bank guarantees amounted to NOK 130.2 million.

EVRY ASA has issued parent company guarantees on behalf of its subsidiary companies amounting to NOK 1,018 million. Guarantees issued by Posten Norge AS on behalf of EVRY ASA or by subsidiary companies amounted to NOK 160.0 million at 31 December 2014. 104 Annual Accounts EVRY ASA

Note 9 Interests in subsidiaries

Shares in subsidiaries are recognised in accordance with the cost method. Book value 31.12.2014 Shares in subsidiaries owned by parent company Registered office Share % Voting % (NOK million)

EVRY Norge AS Oslo 100 % 100 % 4 506.5 EVRY Sverige AB Stockholm, Sweden 100 % 100 % 111.5 EVRY Card Services AS Mo i Rana 100 % 100 % 245.3 EVRY Nordic Operations AS Oslo 100 % 100 % 1 101.3 EVRY Danmark A/S Viborg, Denmark 1) 90.7 % 100 % - EVRY Økonomitjenester AS Oslo 100 % 100 % 40.1 Total 6 004.7

1) In addition, the parent company controls 9.3 % of EVRY Danmark A/S through the wholly-owned subsidiary EVRY Norge AS.

The company merged with the wholly-owned subsidiary company Fellesdata AS in 2014, and consequently took over Fellesdata AS’s ownership interest in EVRY Norge AS.

Note 10 Intra-group accounts receivable and liabilities

NOK million 31.12.2014 31.12.2013

Receivables Non-current interest bearing receivables 2 258.3 2 273.0 Current non-interest bearing receivables - 1.2 Group contribution 138.5 136.0 Total receivables 2 396.9 2 410.3

Liabilities Group contribution 308.7 77.4 Other current non-interest bearing liabilities 15.3 12.6 Total liabilities 324.0 90.0

Non-current interest bearing receivables are due in 2016.

N ote 11 Share capital, shareholders etc.

See note 20 - Group for information about share capital, shareholders etc. Annual Accounts EVRY ASA 105

Note 12 Non-current interest bearing liabilities

NOK million 31.12.2014 31.12.2013

Liabilities to credit institutions 3 151.3 3 486.3 Total non-current interest bearing liabilities 3 151.3 3 486.3

See note 5 - Group for futher information of specifications regarding liabilites to credit institutions and financial instruments.

Note 13 Related parties

Posten Norge AS and Telenor Business Partner Invest AS owned 40.0 % and 30.2 % respectively of the shares and voting rights of EVRY ASA as of 31 December 2014.

Telenor Pensjonskasse has the administration of part the plan assets.

For information about remuneration to executive management and board of directors, see note 7 - Group.

See note 26 - Group related parties for further information. 106 Auditor’s report

Auditor’s report

Statsautoriserte revisorer Foretaksregisteret: NO 976 389 387 MVA Ernst & Young AS Tlf: +47 24 00 24 00 Fax: +47 24 00 24 01 Dronning Eufemias gate 6, NO-0191 Oslo www.ey.no Oslo Atrium, P.O.Box 20, NO-0051 Oslo Medlemmer av Den norske revisorforening

To the Annual Shareholders' Meeting of EVRY ASA

AUDITOR’S REPORT

Report on the financial statements We have audited the accompanying financial statements of EVRY ASA, comprising the financial statements for the Parent Company and the Group. The financial statements of the Parent Company and the Group comprise the statement of financial position as at 31 December 2014, the statements of comprehensive income, cash flows and changes in equity for the year then ended as well as a summary of significant accounting policies and other explanatory information.

The Board of Directors' and Chief Executive Officer's responsibility for the financial statements The Board of Directors and Chief Executive Officer are responsible for the preparation and fair presentation of these financial statements in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway for the financial statements of the Parent Company and the International Financial Reporting Standards as adopted by the EU for the financial statements of the Group, and for such internal control as the Board of Directors and Chief Executive Officer determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with laws, regulations, and auditing standards and practices generally accepted in Norway, including International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements for the Parent Company and the Group. Auditor’s report 107

Opinion on the financial statements of the Parent Company In our opinion, the financial statements of EVRY ASA have been prepared in accordance with laws and regulations and present fairly, in all material respects, the financial position of the Company as at 31 December 2014 and its financial performance and cash flows for the year then ended in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway.

Opinion on the financial statements of the Group In our opinion, the financial statements of the Group have been prepared in accordance with laws and regulations and present fairly, in all material respects, the financial position of the Group as at 31 December 2014 and its financial performance and cash flows for the year then ended in accordance with the International Financial Reporting Standards as adopted by the EU.

Report on other legal and regulatory requirements

Opinion on the Board of Directors’ report and on the statement on corporate governance Based on our audit of the financial statements as described above, it is our opinion that the information presented in the Directors’ report and in the statement on corporate governance concerning the financial statements, the going concern assumption and the proposal for the allocation of the result is consistent with the financial statements and complies with the law and regulations.

Opinion on registration and documentation Based on our audit of the financial statements as described above, and control procedures we have considered necessary in accordance with the International Standard on Assurance Engagements (ISAE) 3000, «Assurance Engagements Other than Audits or Reviews of Historical Financial Information», it is our opinion that the Board of Directors and Chief Executive Officer have fulfilled their duty to ensure that the Company's accounting information is properly recorded and documented as required by law and generally accepted bookkeeping practice in Norway.

Oslo, 23 April 2015 ERNST & YOUNG AS

Jan Egil Haga State Authorised Public Accountant (Norway)

(This translation from Norwegian has been made for information purposes only.) Prosjekt og tekst: EVRY og WergelandApenes Design og produksjon: Artbox AS Foto: Terje Borud Trykk: RK Grafisk AS

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