HiQ BREAKS PROFIT RECORD DURING 2019Including our real estate disposal in Finland, we pass SEK 225.9...

YEAR-END REPORTJANUARI – DECEMBER 2019

This information is information that HiQ International AB is obliged to make public pursuant to the EU Market Abuse Regulation.The information was submitted for publication, through the agency of the contact person set out, at 07.30 CET on 29 January 2020.

HiQ BREAKS PROFIT RECORD DURING 2019INCREASED PROFIT, INCREASED MARGIN AND STRONG CASH FLOWJANUARY – DECEMBER 2019

• Net sales amounts to SEK 1,847.1 (1,852.7) million

• Operating profit (EBIT) increases to SEK 226.0 (196.5) million – an operating margin of SEK 12.2 (10.6) per cent

• EBIT includes realisation gain from the divestment of shares in Westend Affärscentrum with SEK 22.8 million

• Pre-tax profit increases to SEK 224.1 (197.4) million

• Profit after tax increases to SEK 176.3 (151.9) million

• Earnings per share, before dilution increases to SEK 3.16 (2.73)

• Cash flow from operations increases to SEK 232.2 (167.4) million

• Liquid assets increases to SEK 188.1 (183.5) million

• The Board proposes a dividend of SEK 3.40 per share, total-ling 190 million.

OCTOBER – DECEMBER 2019

• Net sales total SEK 491.3 (507.1) million

• Operating profit (EBIT) increases to SEK 61.5 (61.2) million – an operating margin of SEK 12.5 (12.1) per cent

• Pre-tax profit increases to SEK 60.4 (61.1) million

• Profit after tax increases to SEK 46.6 (46.9) million

• Earnings per share, before dilution increases to SEK 0.83 (0.84)

• Cash flow from operations increases to SEK 49.3 (61.1) million

At HiQ we simplify people’s lives by using tech, design and creativity to build smart solutions, businesses and brands. We are convinced that tech development is the best way to make the world better, sustainable, smoother, safer – and more fun. From four guys in 1995 we are today a consultancy company with close to 1,600 brilliant engineers, coders, creatives and business people. Our base is in the Nordics, but our solutions makes imprints all over the planet.

This information is information that HiQ International AB is obliged to make public pursuant to the EUMarket Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out, at 07.30 CET on 29 January 2020.

2YEAR-END REPORT JANUARY – DECEMBER 2019

S I M P L I F Y I N G

S I N C E 1 9 9 5HiQ INTERNATIONAL AB (PUBL.) ORG.NR 556529-3205

SIGNIFICANT EVENTS DURING THE YEARQ4• Saab broaden its collaboration with HiQ and signs new framework agreement for IT services• SVT signs framework agreement with HiQ for IT consultancy services within system development• HiQ wins framework agreement with Telenor Connexion• HiQ simplifies local referendum in Helsingborg, by creating digital support for printing poll cards on site• HiQ develops platform for influencer marketing for the company Valuefication• HiQ is announced as one of Sweden’s Career companies for the year 2020

Q1, Q2 & Q3• The Swedish Tax Agency names HiQ as the winner in its procurement of contracted IT Application services• Orkla Foods chooses HiQ as digital partner to develop future digital solutions• The Swedish Armed Forces (Försvarsmakten) names HiQ as a winner in the procurement for consultant services within the area of digital channels • HiQ and Scania develop a mobile solution that gives Scania customers faster assistance during unscheduled downtime• HiQ develops a mobile solution for ST1-owned service station chain Shell in Norway for coffee subscriptions• Lähitaksi chooses HiQ to simplify taxi travel in Finland• Taxi Stockholm partners with HiQ to develop new digital services• AWA enhances partnership with HiQ and choose HiQ’s integrations platform Frends• HiQ helps SKL make healthcare services more efficient by using AI• Procurator choose HiQ and Frends for system integration • Swedish Automobile Sports Federation chooses HiQ as digital partner• HiQ helps Sixt to launch a completely new service for corporate customer’s long-term car rental• HiQ develops software for tech start-up InviSense’s smart moisture scanners • The Annual General Meeting approves a shareholder’s dividend of SEK 3.35 per share, corresponding to a total pay-out of approximately SEK 187 million• Helena Forsmark is new managing director of HiQ’s subsidiary HiQ Stockholm from 5 April 2019• Ann Hellenius is appointed as a new member of the Board of Directors of HiQ• HiQ moves to a new head office at Katarinavägen 15 at Södermalm in Stockholm• HiQ divests holding in Westend Affärscentrum Oy in Finland• HiQ Sailing Team wins the 2019 ÅF Offshore Race and sets a new epic course record

SIGNIFICANT EVENTS AFTER END OF THE REPORTING PERIOD • HiQ lands new contract and ramps up partnership with Epiroc• HiQ, as employer, is ranked best in industry among IT consulting companies by market insight company Universum




PRESIDENT’S STATEMENT

LARS STUGEMOPRESIDENT AND CEO OF HiQ

”HiQ BREAKS THE PROFIT RECORD DURING 2019”

Net sales during the year amounts to SEK 1 847.1 million. Operating profit for the same period increase by 15 per cent to SEK 226.1 (196.5) million. During the fourth quarter net sales amounts to SEK 491.3 (507.1) million, operating profit increases by 1 per cent to SEK 61.5 (61.2) million and operating margin increases to 12.5 (12.1) per cent. Cash flow for the fourth quarter of the year amounts to SEK 49.3 million and liquid assets total SEK 188.1 million. At the end of the quarter we are 1 560 employees at HiQ. The Board of HiQ proposes a dividend of SEK 3.40 per share, totalling SEK 190 million.

During the second quarter, as announced earlier, we divested our holding in Westend Affärscentrum Oy, which is our former office space in Finland. The divestiture generated a profit of SEK 22.8 million.

During 2019 we increase the profit and margin and deliver a continuous strong cash flow. Also during the fourth quarter we increase profit, margin and cash flow. We have a strong cash position and more employees during Q4 compared to Q3. Including our real estate disposal in Finland, we pass SEK 225.9 million in profit for the whole year – thus more than we ever did before.

If we zoom out and look beyond ourselves, we see a world filled with discussions about Brexit, the U.S., China, trade wars and so on. And we can safely say that technology devel-opment continues to thunder ahead at lightning speed. Every individual, company and organisation are being impacted by new technologies that simplify and streamline our daily lives. Mobile phones have infiltrated our lives, and we use them to pay, shop, watch TV, ride electric scooters, lock the car, con-

trol the hoover, do our banking and more. And we are chang-ing our behaviours as new services crop up all around us.

As I understand it, technology development is one of the essential pieces of the puzzle in building a sustainable world, and my belief is that we as a company provide the best value by continuing to develop innovative digital solutions together with our bold clients.

One clear example is smart digital payment systems, which have cut in half the amount of cash in circulation in Sweden within a span of ten years – from about 110 billion kronor in cash to today’s 55 billion. This is something that, of course, has a major impact on carbon dioxide emissions from trans-port, where coin production alone accounts for much trans-port worldwide.




PRESIDENT’S STATEMENT (continued)

Thanks to strong technology development – which will never subside – we continue to experience healthy demand for our services. After having made the necessary changes in 2019 to streamline parts of the business we are well equipped for the future, even if we would face a temporary slowdown in the market. Our strong R&D and IT business continues to perform nicely, and we are both expanding existing partnerships and winning many new deals and projects.

Recently we broaden our collaboration and do major busi-ness with the industrial company Epiroc. We sign an impor-tant new IT framework agreement with our long-term client Saab. We sign a framework agreement with IoT supplier Telenor Connexion. And we sign a new framework agreement with SVT and UR for system development. Major key compa-nies and long-term clients of HiQ, they serve as proof that our deliverables are of high quality and our offering is broad.

Our systems integration operations and licensing business for our Frends integration platform continues its strong growth with good results. Licence sales of Frends are contin-ually on the rise, and we are completing investments to meet demand throughout the Nordics. As more and more services are being developed and different systems are connected, pressure on corporate IT platforms is increasing, leading to the growth in demand for integration services and platforms.

HiQ’s brand remains strong. As an employer, we are highly ranked by the labour market. Academic Works’ Young Pro-fessional Attraction Index survey puts us on the top-100 list of Sweden’s highest-ranked employers, where many of our competitors are not included. We are named one of Sweden’s Career Companies 2020. And the market insight company Universum ranks us as best in the industry among IT consult-ing companies in the key segment “Senior Professionals”.

At HiQ, we are together building the Nordic region’s best team of engineers, developers, strategists and creators. Together with our future-oriented clients, we press ahead in building a workplace with exciting challenges, exciting projects, exciting technology and an inclusive, stimulating work environment. This is how we have attracted the best specialists in the industry – and this is how we will continue to attract them.

And how will the future look? Luckily, no one can answer that, but I am convinced that it will be fantastic.

– Lars Stugemo, President and CEO of HiQ




OFFERINGS At HiQ we use technology, design and communication to simplify people’s lives. We are convinced that we can build a simpler, better, more sustainable and more enjoyable world with the help of technological developments and smart digital solutions.

Digital services, systems and products are at the core of our business offer, and with the breadth of expertise in the teams we can assemble, we are able to help our clients all the way from business strategy and initial ideas through development and operational management to launch and activation.

We often enter partnerships with clients that view tech-nology as a critical success factor. Partnerships in which we contribute innovative strength and technical skill to the development of both the organisation and its business – always with the user in focus. Hand in hand with our R&D expertise we now have a strong IT offering where we also manage platforms and have a communication offer that aims to meet the requirements and expectations of our clients’ marketing departments.

One of our specialist areas is integration and the integration platform FRENDS, a cloud-based integration platform sold as a license-based service. A so called Integration Platform as a Service (IPaaS). The platform simplifies integration between different systems. This is a challenge that FRENDS solves and that is becoming increasingly important as more and more applications are built and services become de-pendent on data from and to different IT systems.

There is a large market for IPaaS platforms in Sweden and Finland. Today, FRENDS is well established in Finland and we have begun an expansion in Sweden. We currently have over 300 active licenses mostly from companies in Finland.

Our largest market is the Nordic region, but we are winning assignments for international companies who implement our solutions worldwide. Today HiQ has an established presence in four countries and has close to 1,600 employees, each and every one of whom is motivated by and dedicated to our commitment to make people’s lives simpler.

EVENTS DURING THE FOURTH QUARTER• HiQ is expanding its collaboration with defence group Saab. In addition to several ongoing research and development agreements, HiQ has now also signed a framework agreement for IT services.“Saab is a valuable client that we have worked with ever since HiQ was founded in 1995. We are delighted that they value our efforts so much that they are making us an even more com-plete supplier,” says Lars Stugemo, President and CEO of HiQ.

• HiQ is one of the winners in the SVT and Sveriges Utbildnings-radio’s procurement for consultant services within system de-velopment and signs a framework agreement for several areas. ”We have a long-standing collaboration with SVT and UR, and it is gratifying that they chose us in even more areas”, says Helena Forsmark, Managing Director of HiQ in Stockholm.

• The city of Helsingborg goes to the polls on 12 January to vote on whether power company Öresundskraft should remain majority-owned by the city. In the referendum, HiQ contributes to the democratic process by creating digital support for printing voting cards at the polling stations.“This is an assignment that lies especially close to our hearts. Being able to deliver a quick, efficient and secure solution that enables this process is entirely aligned with our ambition to simplify people’s lives though technology,” says Anna Kleine, Managing Director of HiQ in Skåne.

• HiQ develops Valuefication’s platform for influencer market-ing, which is now being launched to companies and influenc-ers in the global market.“We couldn’t find a good tool that truly evaluated online authenticity, value and impact for brands and influencers – so we created it together with HiQ,” says Susanne Lundberg Gulickx, CEO of Valuefication.

• Following a tendering process, HiQ signs a framework agree-ment with Telenor Connexion for consulting services in several areas. Through the agreement, HiQ will help Telenor Connex-ion further develop its IoT platform. “We look forward to our collaboration with HiQ as they have the expertise we are looking for. Together we will be able to further develop our offer,” says Johan Björkman, Head of Sourcing at Telenor Connexion.




• HiQ is named one of this year’s Career Companies 2020. An exciting workplace, unique corporate culture and invest-ment in employees are some of the things the jury highlights. “We are naturally very proud and thrilled to have been named a Career Company in 2020. At HiQ, we are involved in innovative projects and technologically advanced solutions for com-panies at the forefront of digital development. Naturally, this contributes to a dynamic and stimulating workplace,” says Lars Stugemo, President and CEO of HiQ.

EVENTS AFTER THE REPORTING PERIOD• HiQ wins new business with Epiroc for providing development teams to develop software for Epiroc’s machinery for the mining and infrastructure industry.“We’ve been working with Epiroc for many years, and I’m both happy and proud that we’re now stepping up our collaboration even further. It’s proof that we deliver high quality,” says Anders Nilsson, Managing Director of HiQ Mälardalen.

• Market insight company Universum ranks HiQ as the most attractive employer among senior IT professionals in its Career Barometer report.“It’s great that we’re getting attention for this. HiQ has a strong employer brand, and we work hard on communicating all the benefits of working at HiQ. This is proof that it works,” says Erik Ridman, Head of Communications at HiQ.

MARKET SEGMENTSWe divide our market areas into eight segments and have a broad, well-balanced market mix. The breadth is of benefit to our clients but also to us as a company and to our employees. All market segments are characterised by companies’ and organi-sations’ needs for digital solutions that contribute to simplification, new offerings and new value chains.

HiQ’s sales per market segment over the past 12 months

IndustryIndustry is often thought of as the heart of the western world’s competitiveness. The fourth industrial revolution is currently underway – often called Industry 4.0 – in which tools like automation, the Internet of Things, machine learning and artificial intelligence are used to make industry even more efficient.

HiQ is well-established in the industry segment, and we are now a strategic partner for many leading industry players. This most often includes advanced development of state-of-the-art products and business-critical systems. But we also offer innovation and concept development as well as fresh strategies for marketing and sales. And not least, more efficient processes and smart integration between systems using tools like our integration platform Frends.

One example in this segment is Swedish Epiroc, for whom we develop systems that make mining machinery even more safe and efficient. Another is Seco Tools, where we develop systems to enable just-in-time access to new cutting edges. The things we help our clients with help optimise resources, streamline production and make it more sustainable.




Our clients include ABB, Assa Abloy, Atlas Copco, Bombardier, Cactus, DEKRA, Destia, Electrolux, Elenia, Epiroc, Finnair, SAS, Seco Tools and Toyota Material Handling Europe.

TelecomToday connectivity has become a fundamental part of our infrastructure, and almost everything around us needs connectivity in order to work. As 5G expands, opportunities increase and fast connections become an important component in the development of industry, healthcare and smart cities, for example. Which is the foundation for creating more efficient and better services for people and building a better, more sustainable and simpler world.

HiQ has a very strong position in telecom and has worked since the 90s with global telecom companies to develop mobile communication technology. We were involved in the development and rollout of 2G, 3G, 4G and now 5G. This has given us deep knowledge of telecom systems, both from a technical and a business standpoint. And our solid experience and knowledge in telecom and data communication also creates great value for clients and projects in other industries.

We work extensively with our clients in the telecom industry using advanced technical systems, digital channels and solutions specifically targeted to end users. Together with several leading global telecom companies, we continue to build the digital infrastructure for the future of mobile connectivity.

Our clients include Ascom Wireless Solutions, Com Hem, Ericsson, Polystar, Telenor, Telia and Tele2.

Public sectorOur clients’ mission is to offer the people the best possible service, and the challenges involve everything from outdated systems and managing large data volumes to security and privacy issues. HiQ currently has an extensive portfolio of framework agreements and is therefore partnered with an increasing number of authorities, municipalities and public administrations in the Nordics.

Through important framework agreements, we gain a strong platform to grow further within this segment. For example, we now have several framework agreements with

Kammarkollegiet that enable many of Sweden’s municipalities, county councils, authorities and public agencies to use our expertise to simplify the lives of Swedish citizens.

An example of using digital technology to simplify and improvepeople’s lives is our award-winning project for Finnish Trafi,where we are developing a prototype of a digital driving license. This is something that immediately opens totally new possibilities, like updating information on someone’s identity in real time.

During 2019 we have noticed a slightly dampen demand from our clients in the public sector. Some projects have been stalled and crucial decisions have been delayed. This especially effects parts of our business in Östergötland and Stockholm.

Our clients in the segment include the Swedish Public Employment Service, Enköping Municipality, the Swedish Enforcement Authority, Kungälvs Municipality, the Swedish Civil Contingencies Agency, the Swedish Post and Telecom Authority, Swedish Government Offices, the Swedish Tax Agency, Stockholm County Council, the Swedish Association of Local Authorities and Regions, Trafi and Tulli.

AutomotiveSweden is at the forefront of advanced technology for develop-ing solutions and systems for safer autonomous vehicles, as well as smart solutions for resource-efficient vehicles.

HiQ currently has close to 300 product development specialists who focus on automotive. Over the past twenty years, we have collaborated with several global automotive manufacturers and have thus claimed a leading position in the market.

Examples of collaborations within the segment include partnering with lorry manufacturer Scania to develop autonomous transport systems. Other examples are the Volvo Group and Volvo Cars, with whom we have worked since 1998. Today, we deliver technological expertise to Volvo companies so that we can drive environmental improvements and develop active safety features.

Our clients include Autoliv, BorgWarner, Scania, Volvo Cars, Volvo Group and Zenuity.




Finance and insuranceHiQ has extensive experience in the financial sector and the combination of our skills in development and mobile solutions make us a leading expert in the field. The market and demand in banking and finance are strong, and we are needed in many new organisations where we can use our technology to simplify and improve people’s lives. Not least within smart, simple digital payment solutions and solutions supporting banks to adjust regulatory demands.

Together with most of the leading banks in the Nordics, we develop services and systems to make transfers and payments easier and more secure. HiQ’s portfolio has solutions that range from the well-known Swish, Volvo Carpay and S-mobiili to Bambora’s card payment system and further development of the IT systems of major banks. These services, solutions and technologies change behaviours and have become the cornerstones of the Nordics’ gradual move towards a cashless society.

Our clients include Bambora, Bankgirot, Collector, Fennia, Handelsbanken, LähiTapiola, Nordea, OP Pohjolagruppen, S Group, SEB, Skandia, Swedbank, the Swedish Motor Insurance Association, Varma and Volvo Finans Bank.

Entertainment and MediaThe media and entertainment industry is under constant development and transformation. And it’s going fast. Traditional companies today face competition from both new entrants and completely changed behaviours. But their common denominator is the crucial role that technology, design and communication play in their success. These challenges are well aligned with HiQ’s position at the intersection of technology, people and business. We combine technical expertise with design and user focus and follow through with marketing and activation. We have a long track record of working with several leading companies in this exciting market.

We currently have framework agreements in place with several major customers, including SVT and Viaplay, and Finnish company Veikkaus. We also have framework agreement with ATG, turning to HiQ to broaden its offers and products as the entertainment market for licensed gaming is being reregulated.

Our clients include ATG, DICE, GTECH, MTV 3 Finland, Rovio,

Spotify, SVT, the Swedish Educational Broadcasting Company, Veikkaus and Viaplay.

RetailRetail is one of the industries where the rapid technology development totally has changed the conditions. More and more of the traditional retail industry is being redirected to digital channels and online shopping has been a natural part of our consumption for many years now. Thanks to flexible digital services with focus on user experience and the overall customer journey the efficiency of retail is increased. Deliveries are being syncronized from strategically located warehoses and physical stores are not needed to the same extent.

HiQ has extensive industry expertise and a long track record of working with leading retailers. We collaborate with the client from concept and design through to quality assurance, in everything from marketing and sales solutions to purchasing and logistics systems. Our expertise in digital payment services as well as analysis of campaign activities is valuable as new demands are made for simpler purchasing processes to increase conversion rates.

Our clients include ICA, Jula, Kesko, Stockmann and Vianor.

Defence and securityWe live in a time when defence and security are quickly becoming more critical, with monitoring and business intelligence as essential components. A more uncertain world view moves defence and security issues higher up on the agenda. Not least, cybersecurity is an increasingly important issue for all companies and organisations.

Technical solutions for defence and security are part of HiQ’sDNA. Ever since we were founded, we have been helping pioneering clients in the defence industry to develop high-tech solutions that help make the world a little safer. One example is the defence group Saab, where HiQ has recently further extended its collaboration with a new IT framework agreement. Together with Saab, HiQ develops training simulator software for fighter pilots, an assignment that HiQ has been entrusted with for more than 20 years.

Our clients include the Swedish Defence Materiel Agency, the Swedish Armed Forces, the Coast Guard and Saab.




GROUP DEVELOPMENT Our R&D and IT operations are performing well, with good capacity utilisation and strong earnings in all parts of the Group. Our system integration operations and the Frends integration platform continue to grow, we are well established in the market in Finland and we are now expanding in Sweden. In parts of other investment areas, we are implementing changes to simplify and improve operations and increase earnings.

FinlandIn Finland, we are currently operating very successfully in many market segments. We are involved in several big new business deals and are delivering a fourth quarter with excellent earnings. Our digital agency Great Apes continues to develop nicely, win awards and has gained recognition for its projects.

SwedenIn Sweden, we are well represented in all market segments and continue to win new business in HiTech, R&D, IT and Communication. In general, our classic business dealings in R&D and IT are well developed and highly efficient with strong earnings.

In some areas, we are not reaching our ambitious efficiency targets. This applies primarily to our Healthcare and Marketing operations in Stockholm. Therefore, we have implemented changes and streamlining measures that will impact the coming quarters.

RussiaOur team of experts in Moscow is working successfully with other HiQ offices to develop smart mobile solutions that make people’s everyday lives simpler and better.

PolandOur production unit in Poland that is mainly working with our integration teams in Finland continues to develop well.

DELIVERY MODELSHiQ offers a flexible delivery model with a clear focus on client needs, with a track record of effectiveness and success in creating results for our clients. We provide specialist expertise as well as complete teams, in onsite projects and undertake projects on our own premises and via our nearshore office.

MARKETING & COMMUNICATIONThe HiQ brand is very strong, which is important to attracting the right skills to offer our clients. And as an employer, we are highly ranked by the labour market. For the second year in a row, Academic Works’ Young Professional Attraction Index survey puts us on the top-100 list of Sweden’s highest-ranked employers, where many of our competitors are not included.

In Universum’s Employer Branding Survey, for most attractive employers, HiQ is the highest ranked IT consulting company among senior professionals within IT. And HiQ is appointed as one of Sweden's top 100 career companies 2020.

An important and efficient initiative both in terms of exposure, engagement and building pride is our various sports collabora-tions. This includes supporting triathlete Lisa Nordén and MTB cyclist Calle Friberg, both competing for Team HiQ. They have both been successful in competitions but also had time to get to know many HiQ employees through various events. Within motor racing we have among other a successful collaboration with Finnish WRC2 rally driver Emil Lindholm and Formula 3 driver Niko Kari.

FUTURE PROSPECTSHiQ contributes to the development of modern society, in which digitalisation and a connected lifestyle are creating new products, services and business models.

We are convinced that we can create a simpler, better, more sustainable and more fun world through the development of technology and smart digital solutions.

Our expertise and robust financial position allow us to identify opportunities to advance our positions even further in all market segments and areas in which we operate.

HiQ’s overall strategy is to be an innovative and leading specialist service company with the core of its operations in the Nordic region.




HiQ’s growth strategy is to grow organically and to complement organic growth with strategic acquisitions. HiQ’s acquisition strategy aims to strengthen the company’s geographical reach by expanding its Nordic presence and acquiring companies that add new areas of expertise and/or new market areas to HiQ.

We are convinced that there will be long-term growth in all segments in which HiQ is active. We also believe that new technology is a continued critical factor for success in all busi-nesses and industries.

Our strategy is to: • Have the best employees in the market and be the most attractive employer.• Help our clients to simplify and contribute to a better world, by using our know-how throughout the entire chain of technology, people and business.• Be the leading company in the Nordics within our industry.• Generate good profits, good growth and strong cash flow, and to create good long-term returns for our shareholders.

HiQ prioritises quality, profitability and growth – in that order. HiQ does not provide any forecasts.

EMPLOYEESAt the end of the reporting period, HiQ has 1 560 (1 629) employees, of which 1 429 (1 527) were on active duty.

SALES AND PROFITHiQ’s net sales total SEK 1,847.1 (1,852.7) million. Operating profit (EBIT) is SEK 226.0 (196.5) million, equivalent to a margin of 12.2 (10.6) per cent.

Group net financials total SEK -1.8 (0.9) million.

Pre-tax profit is SEK 224.1 (197.4) million.

During the second quarter 2019 the divestment of the holding in Westend Affärscentrum has generated a realisation gain of SEK 22.8 million, which affects the operating profit for the period January-December 2019.

HiQ’s net sales, during fourth quarter 2019, total SEK 491.3 (507.1) million. Operating profit (EBIT) is SEK 61.1 (61.2) million, equivalent to a margin of 12.5 (12.1) per cent.

Group net financials for fourth quarter 2019 total SEK -1.2 (-0.1) million.

Pre-tax profit for fourth quarter 2019 is SEK 60.4 (61.1) million.

INVESTMENTSGroup net investment in fixed assets during the period total SEK 80.5 (26.4) million. SEK 4.1 (3.4) million of this total is invested in new premises, SEK 7.4 (16.1) million in equipment and SEK 69.0 million is right-of-use assets. Right of use assets relates to investments in real estate contracts and company cars and have been added to the balance sheet due to the adoption of IFRS16.

During 2018 there were investments in financial leasing with SEK 6.9 million. The application of IFRS16 from 1 January 2019 explains the vast increase of investments.

FINANCIAL POSITIONCash flow from operations total SEK 232.2 (167.4) million.

Group liquid assets at 31 December total SEK 188.1 (183.5) million.

Owner’s equity at the end of the reporting period total SEK 813.5 (818.5) million, and the equity/assets ratio as a measure of solidity is 64.6 (69.0) per cent.

SHARESOn 31 December 2019 there is a total of 55,842,087 shares in HiQ International AB (publ), which is an increase of 2 500 shares compared to 1 January 2019.

REDEMPTION OF SHARESOn 26 March 2019 the Annual General Meeting resolves that SEK 3.35 per share, corresponding to a total amount of approximately SEK 187 million, be paid to shareholders in the form of a share split and a mandatory share redemption programme. The record day for the share split is 9 April 2019 and trading in the redemption shares takes place during the period 10 April up to and including 25 April 2019. Payment is made on 10 May 2019.

OPTIONSOn 26 March 2019 the Annual General Meeting approved a share warrant programme for HiQ employees. This consists




of two series: the first to be issued in May, the second in November. Both are to be made available to all employees in Sweden and Finland. In the May series a total of 482,800 warrants is subscribed. In the November series a total of 350,100 warrants is subscribed.

If all outstanding warrants from previous programmesand all warrants in the 2019 programme are fully exercised,the dilution effect will be approximately 4.6 per cent.

PROPOSED DIVIDENDThe Board proposes that the Annual General Meetingapprove a dividend to shareholders of SEK 3.40 per share(totalling approximately SEK 190 million) in the form of asplit and a compulsory redemption programme.

This decision exceeds HiQ’s long-term dividend policy, which states that the long-term dividend level should amount to around 50 per cent of HiQ’s profit after tax and be based on HiQ's strong financial position.

PARENT COMPANYProfit after tax for HiQ International AB (publ) totalsSEK 194.2 (67.0) million.

On 31 December 2019, the company’s interest-bearing net assets total SEK 47.7 (31.6) million, adjusted owner’s equity totals SEK 455.5 (446.6) million and the equity/assets ratio is 72.0 (71.9) percent.

Net investments for the period total SEK 8.9 (4.0) million, of which SEK 3.7 (2.2) million is investments in new premises and SEK 5.2 (1.8) in equipment.

SIGNIFICANT RISKS AND UNCERTAINTIESHiQ’s operations are influenced by a number of factors; some of these lie within the company’s control, others do not. For a consulting company such as HiQ, operations are affected by various factors including standard operational and commercial risks. Examples of these risks are recruitment, project risks, competition and pressure on prices, development prospects for major clients, bad debts, and the ability to enter into framework agreements. Market-related risks include business cycle risks.

Financial risks include currency risks and interest risks.For a detailed description of significant risks and uncertainties, please see page 57 in the HiQ Annual Report for 2018.

ANNUAL GENERAL MEETINGAnnual General Meeting for 2019 will take place on 30 March 2020 at 10.00 (CET) at the company’s offices, in accordance with a decision by the Board of HiQ International AB. Notice of the AGM will be published on the company website and in Post & Inrikes Tidningar no later than four weeks before this date and will also be advertised in Swedish newspaper Svenska Dagbladet.

In accordance with the decision of HiQ’s Annual General Meeting, a nominating committee has been appointed consisting of Joachim Spetz, Swedbank Robur Fonder, Mats Gustafsson, Lannebo fonder, and Lilian Biner, Handelsbanken fonder. Chair of the committee is Joachim Spetz. The Committee has also appointed the chair of HiQ Gunnel Duveblad as a member of the nominating committee.Shareholders wishing to submit proposals to the nominating committee can do so by e-mail to [email protected] or by mail to HiQ International’s headquarters in Stockholm, address:

The Nominating Committee HiQ International ABBox 4046SE-102 61 StockholmSweden




This information is information that HiQ International AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out, at 07.30 CET on 29 Janaury 2020.

This report has not been subject to scrutiny by the company’s auditors.

FINANCIAL REPORTS 2019The annual report for 2019 will be available week 11 and can be ordered from HiQ or downloaded from www.hiq.se

Interim report January - March 2020: 21 April 2020Interim report January - June 2020: 16 July 2020

Interim report January - September 2020: 22 October 2020

FOR FURTHER INFORMATION, PLEASE CONTACT:Lars Stugemo, President and CEO of HiQ, +46 (0)8-588 90 000

Erik Ridman, Head of Communications, HiQ, +46 (0)70-750 80 60

HiQ International AB (publ) org. nr 556529-3205Katarinavägen 15, 7th floor

Box 4046, 102 61 STOCKHOLM, Swedentel: +46 (0)8-588 90 000, fax: +46 (0)8-588 90 001

www.hiq.se

Stockholm, 29 January 2020

The Board of Directors of HiQ International AB (publ)




ALTERNATIVE KEY RATIOSHiQ uses a number of alternative key ratios in order to convey a fair picture of HiQ’s results and financial position. Below are definitions of the alternative key ratios used. The numbers written within brackets are a calculation of the key ratio for the period January – December 2019:

Operating margin: Operating profit/loss for the period, in relation to net sales for the period (225 959 / 1 847 053 = 12.2%)

Profit margin: Pre-tax profit of the period, in relation to net sales for the period (224 112/ 1 847 053 = 12.1%)

Net interest income: Financial income, less financial costs (1 567 – 3 414 = -1 847)

Interest bearing net funds, excl lease liabilities: Liquid assets, less interest bearing debts (excl lease liabilities) (at the end of the period) (188 147 – 0 = 188 147)

Equity/assets ratio: Shareholders’ equity as a percentage of total assets (at the end of the period) (813 490/1 259 332 = 64.6%)

Capital employed: Equity and interest bearing debt (excluding lease liabilities) (at the end of the period) (813 490 + 0 = 813 490)

Operating capital: Capital employed, less liquid assets (813 490 – 188 147 = 625 343)

Return on operating capital: Operating profit/loss in relation to average operating capital (259 959 / ((625 343 + 667 340)/2) = 35.0%)

Return on shareholders’ equity: Net profit in relation to average shareholders’ equity (176 303 / ((813 490 + 816 129)/2) = 21.6%)

Net sales per employee: Net sales in relation to average number of employees (1 847 053/1 431 = 1 291)

Added value per employee: Operating profit/loss plus salaries and salary related expenses, in relation to average number of employees ((225 959 + 1 172 089) / 1 431 = 977)

Operating profit per employee: Operating profit/loss in relation to average number of employees (225 959 /1 431 = 158)

Equity/share: Shareholders’ equity in relation to total number of outstanding shares (at the end of the period) (813 490/55 842= 14.57)




ACCOUNTING PRINCIPLESThis interim report is produced in accordance with IAS 34 ‘Interim Reporting’ and the Swedish Annual Accounts Act.

The same accounting principles are used for this report as for the company’s most recent annual report with the exception of certain changes in standards (noted in HiQ’s annual report for 2018) and interpretations that have since come into effect. These are (except what is described below), not considered to have any impact on the consolidated accounts during the reporting period.

For the parent company, the Swedish Annual Accounts Act and the Swedish Financial Reporting Board’s RFR 2 are applied.

Information regarding the adoption of IFRS 16 ”Leases” as of 1 January 2019: HiQ has adopted IFRS 16 using the cumulative catch-up method, with the cumulative effect being adjusted on the adoption date, which means that the prior periods financial statements and key ratios presented in this quarterly report have not been restated to reflect adoptation of this new standard.

As result of the adoptation of IFRS 16, right-of-use assets and lease liabilities have been added as new lines in the consolidated balance sheet. Right-of-use assets and lease liabilities were previously not reported in the balance sheet. Repayment to lessors was reported as a part of cash flow from operating activities. Now the amortization of lease liabilities is reported as cash flow from financing activities.

The Group has applied the new standard as from 1 January, 2019. The Group has implemented the standard using the cumulative catch-up method, with the cumulative effect being adjusted to the opening retained earnings balance in equity at transition date. No restatement of previous periods have been made. The Group has at transition recognized lease liabilities for leases previously classified as operating leases. At the transition, HiQ has applied the practical expedient under IFRS 16 to not reassess whether a contract is a lease but to apply the new standard for contracts previously identified as a lease under IAS 17. The weighted average incremental borrowing rated applied to lease liabilities recognized in the balance sheet at the transition date was 2.0 per cent. Right-of-use assets

have in some cases been recognized based on the amount equal to the related lease liability (adjusted for any lease payments made at or before the commencement date) and in some cases, especially regarding real estate contracts, with an amount as if the asset was depreciated since commencement date. Thereby the impact on the Group’s opening retained earnings was negative with SEK 2.3 million, as of 1 January 2019.

The Group recognizes right-of-use assets and lease liabilities arising from all leases in the balance sheet, with some exceptions. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the incremental borrowing rate.

HiQ applies the recognition exemption for short-term leases and leases for which the underlying asset is of low-value. These leases are instead expensed on a straight-line basis over the lease term.

In the income statement depreciation on right-of-use assets and interest expenses are recoginized. During the period January - December 2019, depreciation on right-of-use assets, previously accounted for as operational leases, amounted to SEK 29.6 million and interest expenses amounted to SEK 2.2 million. Operating leasing expenses for these contracts would have amounted to SEK 29.6 million.

The adoption of IFRS 16 has had an impact on HiQ’s alternative performance measures. The Group has chosen to exclude the lease liabilities from the calculation of the interest bearing net funds and from the calculation of the capital employed and operating capital. Compared with the previous definition, SEK 32.2 million in lease liabilities (as of 31 December 2018) has been excluded from the calculations as from 1 January 2019.

The parent company does not apply IFRS 16 in accordance with the exception in RFR 2.

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