- 1 - EDB Business Partner ASA REPORT FOR THE FIRST QUARTER OF 2007 • Revenue growth of 18 percent compared to last year • Gaining share in Sweden; growth of 119 percent year-on-year • Growth in EBITA of 16 percent • Launch of unique public solution • Expanding nearshore initiative (NOK million) Q1 2007 Q1 2006 2006 Operating revenue 1,583 1,341 5,822 Operating costs 1,441 1,218 5,281 Operating profit before amortisation (EBITA) 143 123 541 EBITA % 9.0 % 9.2 % 9.3 % EBIT before non-recurring items 121 105 454 Profit before tax 96 94 257 Cash flow from operations before restructuring 54 65 709 Operational investment (CAPEX) 49 67 292 EPS (NOK) 0.74 0.74 2.47 No. of employees 3,798 3,359 3,849 EDB Business Partner reported operating revenue for the first quarter of 2007 of NOK 1,583 million as compared to NOK 1,341 million in the same quarter of 2006. The growth in revenue was 18 percent from the first quarter of 2006. After adjusting for businesses acquired, the group achieved organic growth in excess of 6 percent. Revenue for the IT Operations business area was NOK 1,015 million, equivalent to an organic growth of 5 percent from the first quarter of 2006. The Solutions business area reported revenue of NOK 309 million, representing organic growth of 2 percent from the same quarter of 2006. Application Services reported revenue of NOK 291 million for the quarter, an increase of NOK 180 million from NOK 111 million in the first quarter of 2006, which did not include Guide Konsult and DropIT. Pro forma revenue for the business area was NOK 248 million in the first quarter of 2006, giving year-on-year overall organic growth of 17 percent for the first quarter of 2007. The group reported operating profit before intangible asset amortisation (EBITA) of NOK 143 million for the first quarter of 2007, as compared to NOK 123 million for the same quarter in 2006. The group’s EBITA margin was 9.0 percent for the quarter as compared to 9.2 percent for the same quarter of 2006. The IT Operations business area produced an EBITA margin of 8.0 percent as compared to 8.2 percent in the first quarter of 2006. The Solutions business area's EBITA margin for the first quarter of 2007 was 13.8 percent as compared to 14.9 percent in the same quarter of 2006. The year-on-year change is due to a decline in revenue from maintenance contracts in the first quarter of 2007 following the completion of two major conversion projects in 2006. The Application Services business area reported an EBITA margin of 12.3 percent, as compared to an EBITA margin of 13.8 percent for the first quarter of 2006. Amortisation of intangible assets amounted to NOK 21 million in the first quarter of 2007 as compared to NOK 18 million in the first quarter of 2006. The increase in amortisation relates to NOK 4 million for software developed in-house where there was no equivalent amortisation in the first quarter of 2006. Amortisation is expected to remain at the same level over the next three quarters before taking to account amortisation relating to businesses acquired in 2007. First quarter report 2007 - 2 - Operating profit (EBIT) for the first quarter of 2007 was NOK 121 million as compared to NOK 105 million in the first quarter of 2006, representing an increase of 15 percent. Net financial expense was NOK 26 million in the first quarter of 2007, as compared to NOK 11 million in the same quarter of 2006. Net interest expense totalled NOK 25 million, up from NOK 9 million in the same quarter of 2006 as a result of higher interest rates in Norway and Sweden and the debt financing of the seven businesses acquired by EDB in the first half of 2006. The group reported profit after tax for the first quarter of 2007 of NOK 67 million, in line with the same quarter of 2006. Earnings per share amounted to NOK 0.74 for the first quarter 2007, equivalent to the first quarter of 2006. The group’s headcount decreased from 3,849 at 31 December 2006 to 3,798 at 31 March 2007 as a result of the restructuring process carried out by IT Operations. The reduction in headcount will be largely completed during the second quarter of 2007. Cash flow and liquidity Cash flow from operations, before payments related to restructuring measures, was NOK 54 million in the first quarter of 2007 as compared to NOK 65 million in the same quarter of 2006. As a result of the improvement in consolidated earnings over recent years, the company moved into a tax-paying position in Norway in 2006, and the change in cash flow from operations reflects tax payments in 2007 as well as interest payment in respect of acquisitions completed in 2006. Cash flow from operations related to restructuring totalled NOK 49 million in the first quarter of 2007, bringing total payments to NOK 90 million of the restructuring provision totalling NOK 144 million charged in third quarter 2006. Net interest-bearing liabilities totalled NOK 1,830 million at 31 March 2007, an increase of NOK 74 million from the previous quarter. The change principally reflects the final payment of performance- based additional consideration ("earn-out") totalling NOK 67 million in connection with acquisitions completed in 2006. In the first quarter of 2007, the group refinanced NOK 400 million of a long-term loan facility arranged in December 2004. The new long-term multi-currency revolving credit facility has an overall limit of NOK 800 million and maturity of 5 years. At 31 March 2007, the group’s liquidity reserves totalled NOK 1,025 million, representing an increase of NOK 318 million from the end of 2006. Undrawn credit facilities accounted for NOK 891 million. Investment Investment in operational fixed assets amounted to NOK 49 million in the first quarter of 2007 as compared to NOK 67 million in the same quarter of 2006. Investment spending principally related to customer contracts, as well as some maintenance and improvement investment in respect of existing operations. Costs of NOK 19 million in respect of developing and upgrading software for Public Sector and Bank & Finance verticals within Solutions business area were capitalised as intangible assets in the first quarter of 2007 as compared to NOK 6 million in the same quarter of 2006. Capitalised development costs for in-house software totalled NOK 109 million at 31 March 2007. Order backlog The group’s order backlog amounted to NOK 11,082 million at 31 March 2007, representing a net increase of NOK 94 million from 31 December 2006. Of this backlog, 59 percent will be recognised as revenue during 2007 and 2008. IT Operations reported a reduction in order backlog of NOK 75 million to NOK 9,075 million. The Solutions business area increased its order backlog by NOK 151 million to NOK 1,817 million and Application Services increased its order backlog by NOK 18 million to NOK 190 million. First quarter report 2007 - 3 - The group’s business areas IT Operations IT Operations business area comprises network services, operation of infrastructure and applications, security services and user support, as well as electronic business support services such as invoice management, payment services, messaging and printing. The activities of the IT Operations business area cover all industries and sectors, and it operates in Norway and Sweden. (NOK million) Q1 2007 Q1 2006 2006 Operating revenue 1,015 955 3,859 Cost of goods sold 393 344 1,401 Salaries and related costs 311 311 1,207 Ordinary depreciation 66 67 276 Other operating costs 164 155 638 Total operating costs 935 877 3,522 Operating profit before amortisation (EBITA) 81 78 336 EBITA % 8.0 % 8.2 % 8.7 % Operational investment (CAPEX) 38 50 239 No. of employees 1,799 1,965 1,847 The IT Operations business area reported operating revenue of NOK 1,015 million for the first quarter of 2007 as compared to NOK 955 million in the same quarter of 2006. This represents revenue growth for the business area of 6 percent from last year. After adjusting for the acquisition of Datarutin in the first quarter of 2006, IT Operation shows organic growth of 5 percent, due in part to higher project deliveries to Apoteket AB in Sweden. Cost of goods sold was higher than in the first quarter of 2006 due to increased purchases for the contract with Apoteket AB as well as the Datarutin activities acquired. Despite the positive effect of the restructuring that has been carried out, salaries and related personnel costs were at the same level as in the first quarter of 2006 mainly due to the effect of businesses acquired. Operating profit before intangible asset amortisation (EBITA) was NOK 81 million in the first quarter of 2007, as compared to NOK 78 million in the first quarter of 2006. EBITA margin for the first quarter was 8.0 percent, as compared to 8.2 percent in the first quarter of 2006. Operational investment fell by 24 percent to NOK 38 million as compared to NOK 50 million in the first quarter of 2006 as a result of lower customer-related investment spending. The business area's headcount has reduced by 8.5 percent since the first quarter of 2006 as a result of the restructuring carried out. First quarter report 2007 - 4 - Solutions The Solutions business area offers a complete range of software and consulting services for the Nordic banking and finance sector.