Annual Statement 2013

| Source: Enea AB
Enea achieved its profitability target of 20 percent operating margin for 2013
The operating margin and profit per share continued to improve, while Enea’s
sales for the fourth quarter were lower than in the fourth quarter last year.
The profitability target of a 20 percent operating margin was reached for the
third consecutive quarter and for the whole year.

Net sales for the fourth quarter amounted to SEK 106.4 (122.5) million. Both
product-related income and service income declined, resulting collectively in a
13.2 percent decrease in revenues in the fourth quarter. For the whole year, net
sales amounted to SEK 408.5 (467.8) million, corresponding to a decline of 12.7

The operating profit for the fourth quarter increased to SEK 25.1 (20.4)
million, which is equivalent to an operating margin of 23.6 (16.7) percent. For
the whole year, operating profit increased to SEK 82.1 (72.5) million,
corresponding to an operating margin of 20.1 (15.5) percent.

Profit per share increased to SEK 1.18 (0.88) for the fourth quarter and SEK
3.83 (3.18) for the whole year.

Cash flow from operations amounted to SEK 13.6 (20.1) million for the fourth
quarter and SEK 76.6 (80.1) million for the whole year. Cash and cash
equivalents amounted to SEK 163.6 (146.7) million at the end of the year.

October to December 2013
(Fourth quarter previous year in brackets)

  · Net sales, SEK 106.4 (122.5) million
  · Growth, -13.2 (-1.7)%
  · Growth, currency adjusted, -12.2 (-0.5)%
  · Operating profit, SEK 25.1 (20.4) million
  · Operating margin, 23.6 (16.7)%
  · Net profit before tax, SEK 25.3 (20.5) million
  · Net profit after tax, SEK 19.4 (14.6) million
  · Net profit, divested business, SEK - (-) million
  · Earnings per share, SEK 1.18 (0.88) (1
  · Cash flow from operations, SEK 13.6 (20.1) million
  · Cash and cash equivalents, SEK 163.6 (146.7) million

Full Year 2013
(Previous year in brackets)

  · Net sales, SEK 408.5 (467.8) million
  · Growth, -12.7 (4.7)%
  · Growth, currency adjusted, -11.0 (3.6)%
  · Operating profit, SEK 82.1 (72.5) million
  · Operating margin, 20.1 (15.5)%
  · Net profit before tax, SEK 83.8 (76.7) million
  · Net profit after tax, SEK 63.2 (53.6) million
  · Net profit, divested business, SEK - (61.7) million
  · Earnings per share, SEK 3.83 (3.18) (1
  · Cash flow from operations, SEK 76.6 (80.1) million
  · Cash and cash equivalents, SEK 163.6 (146.7) million

(1 Earnings per share is calculated based on profit after tax for the remaining

Anders Lidbeck, President and CEO comments:

"2013 was a record year for Enea. We have earned more money than before and
achieved an operating margin in excess of 20 percent. When we communicated our
long-term profitability target of an operating margin of 20 percent two years
ago, we had not achieved a 10 percent operating margin in the previous three
years. But our very evident ambition was to develop the company’s potential for
profitability. We wanted to focus on the profitable global software business and
our global service offering. Less profitable products and areas have been
filtered out, as have less efficient elements of our organizational structure.
In 2013, we have improved our operating margin every quarter compared with the
same period in the previous year. We achieved an operating margin in excess of
20 percent over the last three quarters. Our operating margin for the fourth
quarter amounted to 23.6 percent, and 20.1 percent for 2013 as a whole. It is
very pleasing to see that we have been able to deliver this growth in

And the fact that this has been able to take place in parallel with heavy
investments in our product development is particularly pleasing. Enea has been
developing and launching a Linux service with unique add-ons over the past 24
months. We are now playing an active part in relevant partner organizations
relating to Linux and shaping strategic partnerships with key hardware players.
Our biggest product, OSE, has also been reinforced in a number of important
areas over the year. This is also true of our increasingly important product
OSEck, an operating system originally customized for signal processors. New
sales of OSEck have come as a pleasant surprise over the year. The combination
of OSEck, Linux and our communications solution LINX is looking particularly
promising. Together, they create a unique offering on the very interesting
System-on-Chip market. We are holding discussions in Europe, the USA and Asia in
this regard, and at the end of 2013 we won our first contract in this field. We
are continuing to invest heavily in product development, and in this I also
include our work with partners and as part of partner organizations. With
investments equivalent to more than 25 percent of our total net sales and 34
percent of our software sales, we are in a good position in regard to
international competition.

2013 was a precarious year in terms of net sales. This was due mainly to the
fact that we saw declining sales of services in all quarters in 2013. Reduced
funding from the American national budget has very clearly affected projects
among our customers. Just over one-third of our service income is dependent upon
defense projects financed within the scope of the American national budget. At
the same time, our American service business is continuing to operate at a
profit, even over the fourth quarter, and we implemented a number of measures to
compensate for the loss of revenue. The contract we concluded at the end of the
second quarter with a leading American manufacturer of electronic payment
solutions reached full volume at the end of the fourth quarter, and in the
fourth quarter the service business saw sequential growth both in the USA and
overall for the first time in 2013. Contracts were also concluded with another
major new customer in the USA over the fourth quarter. This contract also
relates to our Bridged Services concept, where a small amount of the work takes
place in the USA, close to the customer, while most of our work takes place in
Romania. Revenues from Bridged Services thus exceeded the local American service
sales. Bridged Services was also the section of service sales that generated the
highest gross margins in 2013 and was the single biggest section of our global
service business during the fourth quarter.

Overall, our software sales fell by 15 percent over the fourth quarter compared
with the same period last year. This is largely due to a major non-recurring
contract in the fourth quarter of 2012. We did our third Linux deal in the
fourth quarter 2013, this time in China. This means that we have now sold Linux
in Asia, Europe and the USA. These three contracts in themselves are different
solutions and indicate the new opportunities created by our Linux offering. Our
Linux offering has the potential to give us access to new customers. The
business model for Linux is at the same time different, but it is very much in
line with our attempts to sign time-limited deals. We have been focusing over
the last two years on building up our recurring income. 94 percent of software
revenues for 2013 now constitutes the basis for recurring revenues in 2014,
compared with 82 percent the year before.

To further enhance focus on our different markets, we made a change to our sales
and marketing organization towards the end of the fourth quarter, which came
into force in early 2014. A number of other changes have also been made to the
organization, with the aim of enhancing efficiency and reinforcing the services
offered to customers. These changes affect the organizational structure and will
not involve downsizing or restructuring costs. We are continuing our attempts to
improve growth and achieve high profitability. Our aim is to consolidate a 20
percent operating margin and deliver revenue growth on an annual basis.

We are prepared for continued soft demand and assess that the first quarter
might be slightly weak. Our assessment for full year 2014 is that profit per
share will be improved compared with previous year."

Anders Lidbeck, President and CEO

Press and Analyst Meeting

Press and financial analysts are invited to a press and analyst meeting where
Anders Lidbeck, President and CEO, will present and comment on the report.

Time: Tuesday February 11 at 09:30 am CET.

Link: Financial Hearings (

Phone number: SE: +46850556482 eller UK: +442076602078

The full report is published at

This information is such that Enea AB (publ) is to publish in accordance with
the Swedish Securities Markets Act and/or the Financial Instruments Trading Act.
The information was submitted for publication on February 11, 2014 at 7.30 CET.
For more information visit or contact

Anders Lidbeck, President & CEO

Sofie Sarhed, Investor Relations coordinator
Phone: 46 709 71 40 05 or e-mail:
About Enea
Enea is a global vendor of Linux and Real-time operating system solutions
including middleware, tools, protocols and services. The company is a world
leader in developing software platforms for communication-driven products in
multiple verticals, with extreme demands on high-availability and performance.
Enea’s expertise in operating systems and high availability middleware shortens
development cycles, brings down product costs and increases system reliability.
The company’s vertical solutions cover telecom handsets and infrastructure,
medtech, automotive and mil/aero. Enea has offices in Europe, North America and
Asia, and is listed on NASDAQ OMX Nordic Exchange Stockholm AB. For more
information please visit or contact us at

Enea®, Enea OSE®, Netbricks®, Polyhedra® and Zealcore® are registered trademarks
of Enea AB and its subsidiaries. Enea OSE®ck, Enea OSE® Epsilon, Enea® Element,
Enea® Optima, Enea® Optima Log Analyzer, Enea® Black Box Recorder, Enea® LINX,
Enea® Accelerator, Polyhedra® Lite, Enea® dSPEED Platform, Enea® System Manager
and Embedded for Leaders(TM) are unregistered trademarks of Enea AB or its
subsidiaries. Any other company, product or service names mentioned above are
the registered or unregistered trademarks of their respective owner. © Enea AB